In order to facilitiate in-depth exploration of the provisions for GDP spending (and, hopefully, economic recovery) as outlined in Obama's congressionally approved 2009 stimulus package, please actively examine the following reources:
1) Article : "This isn't your run of the mill recession"
2) Breakdown of GDP spending as proposed in the plan (chart):
3) Read an article regarding the topic you were assigned in the second half of class (A Block and students who missed Friday's class: , read the artilce indicated by the "last names start with the letter" heading appropriate for you):
education (A-C)http://blogs.harvardbusiness.org/on-innovation/2009/02/obamas-education-stimulus-isnt.html And/ or http://www.eschoolnews.com/news/top-news/?i=57333
transportation and public works (G-I)http://www.forbes.com/feeds/ap/2009/03/06/ap6135687.html
taxes (J-L) ( you only have to read one, but are ENCOURAGED to read both articles)
citizens - http://www.cbsnews.com/stories/2009/02/16/personalfinance/main4804729.shtml?source=RSS&attr=_4804729
health care (M-O)http://www.cjr.org/campaign_desk/what_the_stimulus_package_hold.php
employment: (P-R) http://www.cnn.com/2009/POLITICS/03/06/obama.stimulus/
poverty releif (S-Z)http://uspoverty.change.org/blog/view/taking_stock_of_obamas_stimulus_package_part_i
4) Share your observations on the stimlulus package overall and the specific component of GDP spending that you read about in the third source.
- Explain the positive and negative aspects of these plans and provide your insight on what economic reforms would be wise to improve conditions in this aspect of the US economy.
- Is this a keynesan or classical solution to the current economic crisis? Explain your answer.
5) post a discussion question for further exploration in class - we'll be debating these issues later on this week.
Reminder: all work for this MP is due Wednesday, March 11. This blog is due Monday, March 9. Minimum of 250 words.
This comment has been removed by the author.
ReplyDeleteLoretta Au
ReplyDeleteMarch 7, 2009
Block F
In our current economic crisis, aid is crucial, so as President of the U.S, Obama passed $848 to help improve the economy. Obama’s main intention is to create more jobs so that the financial system is repaired. He is confident that the economic problems we face can be fixed despite some imperfections in the plan. The plan should, however, successfully create jobs and economic growth. Obama’s recovery plan includes infrastructure spending, long-term energy projects and aid to cash-strapped state and local governments. The jobs include modernizing federal buildings and improving energy efficiency, investments in medical records, creating 21st century classrooms, and investing in science and new technologies. While democrats are confident in this plan, republicans oppose. They say it is wasteful spending and will fail. In a chart shown on CNN, it shows that the House spending is $357.01 billion whereas the Senate spending is $316.896 billion. The House’s largest spending is on labor, health and education at 90.597 billion. The largest Senate spending is energy and environment at $98.334 billion.
President Obama and his education team have created an education plan. Since the stimulus plan was signed, education will receive large funds from the government to create a “plan for lifetime success through education.” One of the areas funds have been injected is early childhood learning. “The earliest years in a child’s life matter most for their future development.” Obama has created early childhood programs for children from low-income families. Another area the stimulus plan seeks to improve is modernized projects. The government intends on installing and upgrading high-speed internet to offer online learning. A third area education is helped is educational technology. Since technology plays a big role in education, more technology will be granted such as computers in classrooms to improve curriculum.
It is a positive deed to be improving schools with large sums of money, after all, “we are the leaders of tomorrow” and it is important to feed the youths minds. Technology has become an important part of society, especially our generation. With the government’s funds to provide schools with more technology, there will be new forms of teaching and learning, which can potentially benefit society. On the other hand, will these new technologies, like computers in classrooms last for long? As an example, our school’s Dells became faulty within the first year. It would require more money to maintain and fix any technology that needs repair. With the funds the government has granted education, it would be wise to improve affordability concerning college tuitions. Despite financial help there is to offer, scholarships and loans, college tuition costs are at an all time high. Many high school graduates have turned down college due to unbearable expenses. If college tuitions are lowered, more students can afford to continue their education to pursue careers. The government’s attempt in improving schools is a Keynesian solution to the current economic crisis. The government has injected a great deal of money despite our debt to improve economic growth. Education is one of the aspects they chose to spend the money in order to fulfill the Keynesian theory.
Teresa Konopka
ReplyDeleteEconomics Independent Study
Blog Assignment
Words: 463
“This isn’t your ‘run-of-the-mill recession’” article from CNN. In it, the stimulus plan was explained. Apparently, Obama finds it necessary for $838 billion to be spent to save the economy. He claims that he is creating 4 million jobs and getting homeowners relief. Obama wants to build infrastructure and begin energy projects. He says he will double production of alternative energy, modernize federal buildings, improve energy efficiency, invest in medicine, improve classrooms, expand broadband access, and invest in science / technology. While Obama seems very hopeful and eloquent, when it comes to actually explaining what will happen to make change, he dances around the subject. This makes opponents quite irate.
After Obama’s stimulus plan was set into action, Paul Begala had his own views on it. As a democratic strategist, he implies that middle America will not benefit. He thinks that the poor will get some jobs and the rich won’t hurt because, well, they’re rich. However, as for the middle class, they will just see their taxes go up as they pay for Wall Street executives to bathe in pools of money. After Begala threw his entertaining insults at the plan, he did admit that Obama seems honest and that he is a better president than Bush. Obama is very confident in his plan, although he knows it is not perfect. He wishes to create more jobs and stimulate the economy. Opponents reply that the bill is entirely wasteful and won’t do anything to better the economy.
Recently, the Senate agreed on the stimulus bill. Not including tax cut provision, the House will spend around $357 billion and the Senate will spend about $316 billion. The House will spend about 50% on the federal / state government and labor / health / education. It will spend about 25% on transportation and urban development. The rest of the money is allocated for energy / environment, agriculture / rural development, commerce / justice, and defense / security. The Senate is spending about 30% on energy / environment and about 50% on federal / state government, labor / health / education, and transportation / urban development. The rest is spend on agriculture / rural development, commerce / justice / science, and defense / security. Again, these titles of allocations are very general and not very specific when such large amounts of money are concerned.
Overall, this stimulus plan is definitely Keynesian. This is because it aims to maintain high employment and control inflation. It is not a Classical idea since it does not advocate minimum governmental intervention. Although some areas overlap, the plan is definitely more Keynesian than it is Classical. One question that is not yet answered is: Who will Obama blame if his stimulus fails?
Rachel Geissler
ReplyDeleteEconomics - ABlock.
After reading CNN’s “Obama: This isn't your 'run-of-the-mill recession'”, I felt a little more caught up with the current lowdown on the recession. According to President Obama, the $838 billion stimulus package is going to open up about four million job opportunities for the unemployed American citizens. Four million is a BIG number. It’s not quite as large of a number as 838 billion, but it’s up there and would definitely provide a stimulus the economy is in desperate need of right now. In Curt Woodward’s transportation article, he referenced Governor Chris Gregoire’s approval of $340 million being allotted for highway and public works projects. Gregoire justified the extra traffic that the roadwork might cause by saying, “When you see those slowdowns out there, and the congestion from that construction, remember: That's jobs in Washington". When it’s put that way, a little more traffic does not seem like such an outlandish sacrifice considering the job opportunities that are made available, the lives saved from road-caused accidents and deaths, and the monetary stability reinforced by a stimulated economy. Although an economy should not completely rely on the government, the current situation calls for intervention. Furthermore, $838 billion will be a large debt for the United States to make up for. However, if it recovers our economy, that might make up for it. Obama’s stimulus package is definitely a Keynesian solution to the current economic recession. According to Keynesian economics, the economy is affected by fluctuations among its four main components – consumption, investment, net exports, and government spending. Obama plans to increase government spending to create more job opportunities. More job opportunities will open up more investment opportunities. The jobs will create products for consumption and possibly even for export.
Question: Has such a stimulus plan ever been proposed to boost an economy out of recession in another country at anytime in history?
Justin Lefkowitz
ReplyDeleteC Block
The CNN story “This isn't your 'run-of-the-mill recession’” went into great detail about President Obama’s recently passed stimulus bill that is worth roughly around $838 billion. According to Obama, the stimulus plan is “not perfect”, but it will get the job done. The plan should start working almost immediately. Obama is hoping to create the chance to save and make new job opportunities for about four million American citizens. If we get the job market flowing again, then more people can start making money. This will allow people to start putting their money into the economy again. People can start buying houses once again. This article really makes it seem like Obama thinks this stimulus plan will definitely get the job done.
The stimulus plan is divided into two parts; one was passed by the House and the other passed by the Senate. The House was the first to pass their half of the stimulus plan. In their half, a total of $357.01 billion would be allocated towards the federal and state governments, health/labor/education, defense/security, commerce/justice/science, agriculture/rural development, energy/environment, and transportation/housing/urban development. The majority of this $357 billion plan will go towards federal and state governments and health/labor/education.
One week later, the Senate passed their half of the stimulus plan. This $317.896 billion dollar plan was passed to help allocate more money towards the categories mentioned in the Houses’ plan. The difference between the two plans is that the one created by the Senate focuses more on energy and the environment.
The energy sector from the economic stimulus package will most likely help in boosting the economy. According to the LA Times article “Stimulus package gives a boost to clean energy”, the stimulus package, also known as the The American Recovery and Reinvestment Act, will invest nearly $79 billion in renewable energy, energy efficiency and green transportation. This will help to create many job openings in the energy field. Not only will creating more jobs fuel the economy, but if we can actually find different types of usable energy sources located in our country, then we don’t have to be dependent of foreign oil anymore. This will also help boost the economy.
The ARRA is a product of Keynesian economics. By this I mean, government spending should be done to move the economy. Although Keynes said, you shouldn’t spend what you don’t have, during times of depression; government investment is needed to help make things better.
Question: What will Obama do to increase the bi-partisanship in Congress, he originally promoted when on the campaign trail?
Heather V.
ReplyDeleteBlock F :)
The stimulus plan, demanding the need for a measure of 838 billion dollars, is said to help pull the U.S economy out of its current skid. It seems as if this stimulus plan doubts the ability of citizens to naturally bring the economy back to normal. President Obama admits that this nation cannot depend on government alone to create jobs or economic growth, yet he believes at this moment the private sectors are weakened and the government is the last resort. Most of the package involves infrastructure spending, long-term energy projects and aid to cash-strapped state and local government. According to Obama, the start of next year will illustrate significant improvements due to this plan. In my opinion, this stimulus plan is a huge risk America will be taking. All of this money, which I could never even imagine in my sight, seems to be falling from the sky. So much money invested into the nation, and the possibility of the economy getting worse is not that different from the possibility of the economy prospering.
Education, an extremely vital component of the gross domestic product spending, is one of the several generalized aspects that will receive money from this stimulus plan. Schools will be receiving large funds from the federal government in an effort to better the education of America. In Michael Horn’s article “Obama’s Education Stimulus Isn’t Enough”, questions are raised as to where exactly will all of this money be invested into. “Studies show that investing in the education produces economic gains, but the investment must be in effective programs”. If this money is thrown around to areas of little impact, Obama’s education stimulus will be an epic fail. A strong emphasis of the bill is put on early childhood learning. Early childhood learning sets the foundation for future learning, however I don’t believe investing that much money in an early childhood education will benefit out economy. Also, money is invested to increase funding for technology. Indeed technology is growing day by day, and plays a strong role in society. However spending money on computers that will evidently break within a year or become outdated within two years will not impact our economy positively. This bill worries me. Much money is being invested into a great area of education yet what schools do with the money and how they spend it brings hesitation. Nonetheless, schools will hopefully invest this money into worth-while and successful projects. After all, education is the key to success as knowledge is power.
Evidently the stimulus plan reflects a keynesan solution rather than a classical solution. President Obama plans to save the U.S. economy with a massive round of government spending, similar to what Keynes theory suggests. Keynes believes that a government can pull a country out of a deep recession by spending a lot, exactly what Obama intends to do with this bill. Classical economics teaches that if there's a downturn, the economy will eventually sort itself out. Ultimately, the stimulus plan illustrates big government intervention, as Obama is trusting Keynes theory to pull America out of its sticky economical situation.
Question: Would President Obama's stimulus plan be the first testing of the results of Keynes' theory?
Sarah Berfond
ReplyDeleteF Block
President Obama has proposed legislation which is designed to create millions of jobs across the country. The foundation of the legislation involves spending government money on rebuilding roads, bridges and other infrastructure. The President wants to reform many aspects of healthcare, education and energy production. By financing these improvements, he hopes to create jobs for the many people suffering through the current recession. The cost of the new policies will be over $780 billion. The plan has many supporters and critics. The supporters argue that America is an unprecedented financial crisis and on the verge of another great depression. The benefits of President Obama’s plans will be to create jobs and stop the economic deterioration. Opponents of the plan feel that the government is spending too much money which it does not have. The increase in the deficit and money supply will cause inflation to run out of control in several years. President Obama’s efforts to create jobs are Keynesian solution to the country’s problems. Economists influenced by Keynes believe that the private capital markets are inefficient in solving many problems. They feel that the government must intervene in order to balance supply and demand and maintain continued growth of the Growth Domestic Product. The classical solution to the economic downturn would be to allow the free market to work through the problems. Will this change in economics simultaneously cause a change in the government form and function?
Veronica Geager
ReplyDeleteA Block
In the CNN article "not your run of the mill recession," President Obama proclaims that his stimulus plan will help the economy recover from the disastrous state it is in right now. His bill, which has passed bot the House and Senate, will create over four million jobs,double the production of alternate energy, make over two millions homes in America energy efficient, and equip schools with 21 century technology. The stimulus bill will change the infrastructure of the United States by building bridges, fixing roads, and putting more advanced technology into government buildings. According to the article, most Americans will feel the effects of the plan by next year. Although the plan seems great, it is also met with criticism from many politicians, mainly politicians from the Republican party. Many say that it is creating wasteful spending, that the United States physically does not have. Many also say that it is not up to the government to help fix the economy. They say that if the government interferes, it will lead to an even worse economy for future generations. Although, FDR's New Deal certainly helped the US during the Great Depression. However, in this time of recession many people are clinging to the hope of a better economic future. President Obama insists that this will help to pull the US out of its current downfall.
Question: Is Obama's stimulus plan the "New Deal" of the 21 centruy?
President Obama’s stimulus plan for the United States seems solid and concrete. Obama seems pretty confident that this plan will work and help the economy to recover. The stimulus plan will create four million new jobs, majority of which would be created by the private sector. If Obama is right, and improvements and increases can be seen within the next year, than this is definitely the way to go, but on the other hand, republicans seem to believe that the stimulus plan is a waste of spending and will not do any good. Then there are the people that feel the government shouldn’t be involving themselves in the market place and others feel that at some points the government needs to step in. For those that think the government should not step in, at what point does it become a necessity for them to become involved?
ReplyDeletePart of the stimulus plan includes making education more advanced and up to date with twenty first century technology and thinking. $9.9 billion is needed to make all title 1 schools up to date with current technology. Although this plan lacks some funding, the idea behind it is great. Technology is increasing and times are changing and with changing times education must be altered to fit the time.
The overall effect of the stimulus package is supposed to be a very Keynesian approach to pulling us out of the recession, however, the way that spending is distributed in the pie charts on CNN are very interesting. While the House wants to spend more on the government and labour, health, and education, the Senate wants to spend more on energy and the environment. Even though it seems like a very good initiative, clean energy and environmental causes will always be an issue, right now, jobs need to be created to secure the welfare and health of the nation, and education should also be a main concern. Speaking from someone who is soon to be feeling the impacts of the economy firsthand, the emphasis on creating jobs is very important to me, more important than finding clean energy sources. I can see where clean energy can be positive, in creating jobs in the energy sector and in the long run being beneficial to our environment, but I am very skeptical of this being something that we should be spending almost 100 billion on. This is a Keynesian approach due to us spending more to pull ourselves out of the recession and into a period of growth. It seems that the money needs to be better distributed, maybe even amounts to every single sector, and then see how things work from there.
ReplyDeleteElizabeth Che - Block C
ReplyDeleteThe CNN article, "Obama: This isn't your run-of-the-mill recession,"
describes President Obama's stimulus plan and its acceptance in Congress. Accordingly, Obama states that the $838 billion measure will either create or save 4 million jobs and ensure the financial system to be in working order. Considering the slump American economy is in, the federal government is the only one with the resources to revive the private sector. The stimulus package is also aimed at infrastructure spending, long-term energy projects and aid to cash-strapped state and local government. Overall, Obama acknowledges that the government shouldn't be relied on to "fix" everything but to improve.
The GDP spending as proposed in the plan (chart), shows two versions of the stimulus plan. The House's plan amounted to spending $357.01 billion whereas the Senate amounted to spending $316.896 billion. The largest differences between the proposals are the spending in energy and environment, federal and state government, and labor, health and education of which the House's price are almost double that of Senate. Overall, the House spends the most in labor, health and education and federal and state government while the Senate spends the most in energy and the environment. The other categories are closely distributed.
The article, "Obama's Education Stimulus Isn't Enough" by Clayton Christensen and Michael Horn describes the education system being given a large fund for improving and upgrading. The funds however, will not have an effect on the American educational system unless it is used for future planning and smart investment. As Christensen continues to explain, there are three areas of which investment should be made in effective programs. The first area is in starting new childhood programs that would foster children(especially those from low income families) to be comfortable with their education and increase their potentials. The fault in this plan is keeping the children interested and focused however, past research shows the lack of progress.
The second area is spending for school modernization projects. This includes installing broadband and wireless networks for schools to be able to access the internet faster. Along this line, it was also suggested that some funds should go to low-income communities in effort to connect them to the internet as well. Another area of investment is the allocation of $650 million on educational technology. This modernization would include incorporating new computers into classrooms as well as other technological assets to learning. Yet, technology may not necessarily bring about the desired change. Christensen states that research shows relatively no change in it's progress and suggests the money be spent on curriculum development.
The government isn't focusing it's attention in adequate areas being that most of the suggested plans involve the low-income families only. If the government only plans on helping the low-income group, those of the middle class who are suffering from the economic hardship will also fall into the low-income category. With that result, the low-income group will increase without boundaries, whereas it could be prevented if action were taken to enforce success for all classes and ensure smooth lifestyle for all groups, not just the low-income families who are already receiving help from non-profit organizations. In terms of the funds for education, it is beneficial for schools to receive extra support in order to purchase and afford programs and materials. The funds can also be used to prevent program cuts and protect teachers from layoffs (as"Education snags $105.9B in stimulus package" explains). The wireless internet network which was suggested is also a good way to upgrade the educational system, being that lessons are now incorporating the use of resources outside of textbooks. But as the article explains, the extra funds will only help if the schools have established a proper curriculum. Without the proper footing, additional materials will not help.
This is a Keynesian solution to the current economic crisis because the government is spending in order to recover the economy. This falls under the "investment" part of Keynesian economics. As mentioned in the article, "What Would Keynes Have Done?" by N. Gregory Mankiw, "a fall in consumption would be met by an increased investment, which includes spending by business on plant and equipment and by households on new goods." Comparatively, classical economics would indicate a self-recovery, which wouldn't need the government to interfere, not to mention offer any funding of large scale to improve the situation.
Discussion question: How else can the government improve the education system, besides using money to finance programs directly?
The CNN article, “Obama: This isn't your ‘run-of-the-mill recession’” talks about Obama’s stimulus plan which proposes the use of $838 billion in order to “help pull the U.S. economy out of its current skid.” He is encouraging Congress to act immediately in order to create four million jobs and make sure the financial system is working again. Under normal circumstances, it is the job of the private sector and not the government to create jobs, but the private sector is currently weakened by the recession, according to Obama.
ReplyDeleteOn the positive side, many jobs will be created, if passed. There will also be long-term energy projects and aid to state and local governments. In addition, a positive aspect of the plan is that it is supposed to bring about significant improvements starting next year. However, the economy is severely struggling, and although next year is soon, it’s not soon enough. Another negative part of the plan is that republicans are saying the plan includes “too much wasteful spending [that] won’t stimulate the economy.”
“What the Stimulus Package Holds for Health Care” by Trudy Lieberman talks about Obama’s plans for health care in the future. By 2014, Obama wants every American to have an electronic medical record. The Stimulus bill will be funding a $700 million health care comparative effectiveness research. This means that if two drugs are equally effective but one costs less, the cheaper drug should be recommended. In addition, people who lost their jobs because of the recession, can have Medicaid coverage until 2011 without being subjected to the typical rules that require very low incomes and very few assets. Lastly, there’s talk of using COBRA extensions. It will allow people 55 and older in the same job for ten years or more to continue on COBRA at their own expense until they become eligible for Medicare.
The Stimulus bill is a Keynesian solution to the current recession. In order to end the recession, the government is proposing to spend a bunch more money. In addition, the plan involves much government intervention, compared to a classical idea with little government interference. If the Stimulus Bill fails, will it further harm the economy?
The stimulus plan has allocated nearly $90 billion for modernizing roads, bridges, transit, and waterways. These projects will create many jobs as well as improve underdeveloped areas. If these projects succeed, our nation will become more energy efficient and less dependent on foreign oil. Furthermore our environmental conditions will improve and the amount of resources in our country will surely increase.
ReplyDeleteHowever, there are some negative aspects to this plan. These jobs that will be created can be done by people without college degrees, and might deter a high school graduate’s acceleration into college. One of Obama’s main goals in improving the United States is to increase the college graduate rate, which has been quite low in recent years. Some might feel that these jobs created might not help contribute to the college graduation rate. Also, the traffic that comes with the construction of these new roads and waterways might increase temporarily, and if the job is not done in a timely manner, the traffic problem might be a big factor.
This Stimulus Plan is a reflection of Keynesian economics because Keynesian economics promotes economic policies that come from a centralized government. The Stimulus Plan creates a big government that has more control over our economy, as opposed to our capitalist ideals. Private sectors will no longer determine the fate of the economy as long as this Stimulus Bill is in effect, although this is not a total loss. While it is important in our nation for capitalism to be practiced, there are times when the government must intervene. Keynesian economics is a theory where a powerful centralized government regulates the economy by determining the allocation of federal money. Government policies will increase aggregated demand, therefore increasing economic stimulation, employment opportunities, and contribute in the decrease of inflation. In times of economic recession, the government should help stimulate the economy in order to create balance and stability.
Anam Baig, Block E
Question: Would Obama's Stimulus Bill prove that having government intervention in the economy is a positive thing, rather than having the entire economy controlled by private sectors?
ReplyDeleteLoretta Au
ReplyDeleteBlock F
Sorry! Forgot to pose a question!
Question: The education aspect of the Stimulus Plan seems to be very focused on technology. What effect do you think will more technology is school have on the students and future schools?
Karmila Saulong
ReplyDeleteBlock F
A proposed seven hundred billion to one trillion dollar stimulus plan will be going towards The American Recovery and Reinvestment Act passed by the Senate and the House. The question is: Is the stimulus plan a wise choice for the US economy? About seventy seven billion will go towards unemployment benefits while four hundred to six hundred billion will go towards government spending. However, there may be positive results. The stimulus plan will open job opportunities for those who have currently lost their jobs. America has reached the peak of job cuts in US history. The bill will allow those who have lost jobs to find on that will stimulate economic growth. Also, government will increase spending for programs such as food stamps, housing subsidies, and Medicaid. But, many social programs may be getting cuts. Many homes rely on state-provided healthcare.
The stimulus plan represents is a Keynesian plan. Through government spending, President Obama is following the examples of past Presidents who used the Keynesian theory to pull out of an economic recession. The theory advocates the idea that spending more will end the recession. Obama is planning to mix government with the economy and is hoping for a positive outcome by using the Keynesian theory.
In response to Anam’s question, Obama’s stimulus may prove that government intervention in the economy is negative rather than positive. Although, many can argue that it is positive, the fact that the economy will be controlled by the government and private sectors proves that America is moving towards a socialist government.
Question: Is the stimulus bill causing America to towards a socialist economy?
Obama’s stimulus plan is surrounded by a lot of money. Most of that money is going towards unemployment and tax benefits. There are still going to be problems with these plans. Most of the money will go towards Medicaid. States can use this money for their own requirements. I doubt that the states would do that. This plan is to help those who lost jobs to easily recover. This plan also increases food stamps and Medicaid, which will help the poor. Food stamps are at high numbers at this time and this recession has also cost low income and foreclosures. Unemployment rates have increase since Bush been in office. This is a Keynesian theory because Barack is spending a lot to end the crisis. If this doesn’t work then everything will fall.
ReplyDeleteAnthony Fontana
ReplyDeleteBlock C
The stimulus plan raises many questions. Will this restore the economy, will this lead us into greater depression, or will this leave tax payers with a larger burden that could be bared? The stimulus plan seems like a good idea. The idea of the 2009 bailout plan is to pump money into the economy and create unemployment. Unemployment is a huge role in the recession. Unemployment does not only affect the individual, but it affects businesses and enterprises, and the morale of the economy. If people do not have jobs that wont be able to purchase goods and services. Also, when unemployment is on the rise, people begin to conserve money and cut spending. This plan will help short out this chain reaction. BUT, with a huge cost. The tax payers in six to ten years will be paying for this package with high tax rates. This might cause interest rates to go up, making buying more difficult. The trickle-down theory says that providing hefty tax cuts will benefit the public. Ron Paul had taken that economic approach when he ran for president. He took a more classical approach to resolving the economy, as opposed to a Keynesian approach. Barrack Obama’s stimulus plan is by far a Keynesian approach. He is using government money to benefit the economy, and Keynesian economics says that as government spending increases the GDP will rise. The stimulus plan has some good ideas. For example, a large portion of it is going to improve the infrastructure. This creates jobs and increases individual spending. Although, this will be expensive for the government; they no longer have to pay unemployment. These are all based on economic theories.
When it comes to the stimulus package, our economy is currently basing everything we have in terms of funding, on getting our country out of debt, but its the long term assets that are not being observed that will lead us into yet another recession and possibly a depression. When reading the LA Times article about our energy crisis and its effect on the economy, i found that our country is harshly addicted to foreign oils. When such energy as solar, wind, which can help stationary energy costs within business and the family home, mobile energies for the auto industry play a huge part in providing a solution to break away from fossil fuels. As american companies like Ford, GM, and Daimler Chrysler, continue to build large vehicles which continue to further enhance our addiction. While asian companies such as Honda, Nissan, and Toyota are building Hybrid, and Even Electric cars for their countries of origin. Even many nations in Europe do not utilize Gasoline (or Petrol as they refer to it) as much as we use in the States. Diesel and Bio-Diesel are more efficient and more healthy for the environment as theses fuels are burned more efficiently allowing less CO2 emissions to be sent into our earth atmospheres. When it comes to the auto industry, we find the American Auto makers to build Hybrid cars in the form of trucks and crossover SUV's. With the help of this stimulus plan we will be able to properly allow the auto companies to comply with the more detailed and mandated Co2 emissions bills that our nations is currently working on. Electric Vehicles factories will open thousands if not millions of new jobs as well as more jobs in the field of construction to build the charging infrastructures. Bio Diesel and even regular diesel are more efficient and more safer fuels to utilize rather than traditional Gasoline. With these technologies, and making our present energy productions, we will be able to rid ourselves from forign fuel and help boost our economy with more fuel efficent vehicles and creating millions of jobs to help get away from this recesssion. thanks to changes that can be made to the auto industry.
ReplyDeleteWayne Vivola
F-Block
Obama' creation of the stimulus plan seems to be helpful for the failing economy. It will take awhile, but I believe it will work. According to the article This isn't your run of the mill recession, about $838 billion is necessary to pull the U.S economy back together. Obama wants to create and save about four million jobs and give home owners relief. It was said in the article that the stimulus plan will double the production of alternative energy in the next three years, modernizing federal buildings and improving the energy efficiency of two million American homes, making investments to have the country's medical computerized with five years, equipping schools with 21st century classrooms, expanding broadband access, and investing in science and new technologies. Republicans feel the stimulus plan includes too much wasteful spending and won't stimulate the economy. This may be true; however, Obama said the economy will get worst before it gets better. This is a saying Americans should learn to understand. We as a country put ourselves in this mess. We spent unnecessary money on unnecessary things and now we have to pay the price. Many feel that Obama's stimulus plan will take a long time to affect the country. This is true, but any other plan to help the economy will take just as long. We are in a records debt that will not go away over night with any plan.
ReplyDeleteOf the many categories unemployment seems to be the biggest deal. Jobs are laying millions of people off. In fact, in the last six months three million people were layed off in the US. This is disgusting. The funny part about unemployment is these people still have to survive. So they will depend on the government and other sources to help them out. Therefore at the end of the day more money is being put out to help these people.
There are goods and bads about Obama's stimulus plan. One positive is millions of Americans will have new jobs to survive off of and new jobs may mean new found technology. A negative aspect of the stimulus plan is the limiting of growth and innovation in the electronics or auto industry during this recession.
Obama's stimulus plan is definitely a Keynesian solution because the plan is investing more money into the economy. This will stabilize it and avoid future recessions. - don't know is the the Keynesian solution actually work; however, it sounds good for the people today and those who will be here in the future.
Melissa Coughlin
ReplyDeleteC Block
(note: science and technology, the assigned topic, was not specified in the article choices, so i did "engery" because it seemed the closest to it)
All over the media, the stimulus plan is being projected. Yet, it is pretty blurry to the average person because it is quite hard to understand and difficult to believe. This recession has left America and the rest of the world in a state of peril. After the housing market crashed, many people were left without homes. One must remember that this happened while G.W. Bush's presidency was soon to end. Obama came into office with an optimistic attitude and strong faith in the American people. As explained in the article, "“Obama: This isn't your ‘run-of-the-mill recession’”, by CNN, the stimulus plan is quite pricey. President Obama is mainly focused on helping the people who have lost their jobs. It is those people we need to get back into work so that the country can start creating more products. When people are paid for their work, they go out and spend their money, contributing to the GDP. As the GDP increases, the country could get out of debt, which is greatly needed at this time. Obama proposes roughly $838 billion dollars could get America onto a steady economic path for now and the future.
Obama is investing a lot of the stimulus plan in science and technology. Technology and scientific research are extremely important at a time like this. Building new technologies could create many jobs. Obama hopes to employ 4 million people who are probably now jobless. These new technologies would mostly be revolved around new types of energy, such as solar energy. Right now, SolarCity, one of the largest residential solar firms is hoping to hire somewhere around 16 crews. New energies are vital to the country's economic and social growth. Though, this would also decrease America's dependence on foreign oil. Somewhere around $79 billion will be invested in renewable energy options.
I personally think that this plan is going to work! New sciences and technologies are the way of the future, anyone could tell you that. It is obvious that there will definitely be plenty of places for jobs. I believe that America should start producing more of its products in America, though. It could fill so many more jobs. It’s just that companies believe that it costs much cheaper in other countries to produce products, but we would be investing in our own futures by doing so in America. The current stimulus plan is a keynesan solution. The more we invest in our own country, the more money we will make. The more money the government puts into the economic plan, the more jobs, the more people will spend, the more the GDP increases.
Question: In your opinion, do you believe that America would not be in this current economic situation if we still produced most of our products in our own country?
Quelmi Johnson
ReplyDeleteThe article from “This isn’t your ‘run-of-the-mill recession’” from the CNN website sums up the stimulus plan of 2009 proposed by President Obama. The plan is intended to provide a stimulus to the U.S. economy in the wake of the economic downturn brought about by the subprime mortgage crisis and the resulting credit crunch. The stimulus package is about $838 billion dollars and intends to create about 4 million job opportunities for many unemployed Americans throughout the country. Unemployment has increased more and more and continues to increase making the recession worse. Not only is unemployment on the rise the countries GDP is also lowered. Another important part of the stimulus plan happens to be technology and scientific research. According to the CNN article “Obama: This isn't your 'run-of-the-mill recession'” 357.01 billion dollars will be spent by the House and 316.896 billion will be spent by Senate. The stimulus plan is very much similar to the Keynesian plan.
Question-How long will it take for the stimulus plan to work in full effect?
I personally have no set opinion on this matter- any monetary matter to be precise. However I know people that do such as my father, who sparks opinions in my brain, which ultimately go out the other ear due to my ill feeling towards the economy. Thus, my thoughts are all over the table. Moving on, this tax relief is said to be a necessary tool to jump start the economy into breathing again, inhaling and exhaling money. Lowering the taxes on the middle and lower class will allow those people to spend their money on products. This will then cause more need for workers and will raise employment. Then the people that are employed will be able to buy products etc. Thus, the economy will live happily ever- consuming and producing. On the contrary, I can't help but say "poor upper-class" because their stuck with all the taxes now. Perhaps since they have money they're able to pay these taxes, but lets just say they lose some money due to the paying of their taxes. Then they become classified as middle class, and the lower class gets richer since they have reduced taxes, and then the whole country becomes a middle class, and then bam! The US becomes communist...this isn't all entirely bad...nor does it make any sense, haha sorry. On the other hand, the negative hand, the government is going to be spending more, where does government get it's money? Taxes. On the contrary belief, I thought there was a tax relief. For the time being this may ring true, but what happens when the void of all the spent money needs to be filled in, what will happen if these tax cuts expire? Perhaps this will cause taxes to raise once again. Then perhaps there will be another recession, and history will unfortunately repeat itself?!
ReplyDeletePerhaps I'm not making any sense!? All well, I just don't understand economics. =[
I some-what think it's a tad of both solutions. The government is intervening which represents the Keynes, but with the tax cuts the supply of extra money is meant to create more demand which represents classics...
Q: What would Abe Lincoln do?
To help boos the current economic status our president, barrack Obama, has proposed a stimulus plan to help improve the economy. He plans to do this by distributing a total of 848 billion dollars amongst the various sectors in crisis. Obama plans to do this by spending money and providing tax cuts to businesses and families. President Obama has expressed confidence in the plan and has stated his main objective is to create or maintain at least 4 million jobs. President Obama has received less than a warm feedback from the Republican Party on the stimulus package. The conservative movement has called it an immense waste of time and money and a burden on future generations. However Obama argued with, "it's a little hard for me to take criticism from folks about this recovery package after they've presided over a doubling of the national debt."
ReplyDeleteObama also addressed a bigger problem; the government should not interfere or direct the private sector or the economy. However many economists agree that the spending from the government is just the stimulation needed by the economy right now, as they are the only sector with enough resources to do so. President Obama recognizes the intensity of our current economic status, and proposes we take definitive and important steps to improve the situation. President Obama hopes the package will result in solving the energy crises, expanding the technological horizon, and improving schools. The stimulus plan has been divided into two parts; one was passed by the House and the other passed by the Senate. The House was the first to pass their half of the stimulus plan; a total of $357 billion would be spent towards the federal and state governments, health/labor/education, defense/security, commerce/justice/science, agriculture/rural development, energy/environment, and transportation/housing/urban development. The majority of this $357 billion plan will go towards federal and state governments and health/labor/education.
The government has planned to provide tax cuts for businesses, low income and/or large families. The package provides relief to companies in debt and assistance in investments. The package provides new homeowners with a tax relief of 10%, and they don’t have to pay it back. It provides college students with credit worth up to 2500 dollars towards college tuition, and it is applicable to the first four years. This approach is definitely Keynesian, as it is the stimulation of the economy through spending and aiming to maintain a stable rise of the economy. This could help in the long run only if we maintain our spending and are wise about the allocation funds; however it also has a very high chance of failure as this could backfire and send us in a downward spiral. It would increase the deficit and only dig us a deeper hole.
Michela Infantino
ReplyDeleteMany questions come about when the new stimulus plan is on topic. They question if Barack Obama’s, over six hundred page plan, would make or break our economy. The plan is broken into different categories using different percentages of money towards, education, transportation, taxes, citizens, businesses, health care, employment, energy and poverty relief. By using the stimulus plan money towards taxes mostly compromises the middle and lower income families. For lower income families, thirteen percent of the tax money will be used to increase food stamp benefits as well as 3.5 million jobs being created to help people obtain a job and expand housing assistance. Tax credits are also available through 2016 and recipients of social security, supplemental security income, railroad retirement benefits and veterans would receive a one time payment of $250. On the other hand people making over seventy five thousand dollars are not able to receive these benefits. People also believe these tax cuts or any stimulus effect due to money-in-hand wouldn’t be felt until 2010. With a shorten recession, that result in a negative GDP (Gross Domestic Product) growth. As far as energy wise, Nicole Dillingham, a board member of Otsego 2000 says, ‘we’re not opposed to renewable energy; we’re opposed to the placements of the turbines.” Would this plan help our nation in the long run?
The stimulus plan is an act advised by the president and voted in effect by congress, to help the economy recover. Over $8 billion of government funds and loans have been put into the stimulus package. Its quite ironic though that the governments solution to a recession is to spend massive amounts of money. Many look at the stimulus plan as a way of boosting the economy, however it isn’t really a permanent solution. People seem to be blinded by the immediate increase in jobs leaving many completely indifferent to the fact that these are temporary positions. The stimulus plan is a short-term fix for the economic situation that eventually will leave the government in trillions of debt. It will lead the U.S. economy into another decline and according to the classical economic theory the next recession will be even worst then the current. Although if we considered the Keynesians theory, this would be a great way to improve the economy because it states that an increase in government spending would lead to less unemployment and a strong market economy.
ReplyDeleteIs it a good idea to let the federal government control in-state programs as a way of lifting the economy?
Sylvia Shojai
ReplyDeleteBlock A
Obama’s stimulus plan is often mentioned in the media. The plan is to renovate roads, bridges and transit so that America can be more energy efficient. Working on these projects will also employ many Americans who have been waiting, unemployed, for something to change. This plan is well thought out because it will allow us to rely on our own country’s resources, instead of shipping and importing foreign goods. Obama also hopes to increase the College graduation rate, which isn’t being helped here. However it is still essential for energy sources to be ensured; the employment alone is a plus. It’s great that Obama is investing his stimulus plan in science and technology because it could really help out the country at a time of desperation. With $838 billion circling through Obama’s stimulus it definitely isn’t a typical, “run of the mill recession”. He hopes to employ 4million and give some aid to homeowners. The Stimulus Plan is an example of Keynesian economics. It comes from a centralized government and interferes with America’s capitalistic views. The stimulus plan gives the government a big role in the economy which we generally oppose. In this case it is good that the government is inferring because for once everyone will be on the same page. With everyone intently watching Obama we will see in which direction the stimulus plan takes us. With the increase in job opportunities, gradually the employment rate will rise and so will the spending rate for goods in the country. Once this occurs it’s a pretty good indication that percentages keep moving around, and maybe the economy will start to stabilize.
Question: Besides the education system and job employment, what will the Stimulus plan touch base on that needs fixing in the economy?
The Obama Stimulus package promised the citizens of the United States immmediate action to create jobs in America, immeadiate relief for struggling families, direct assistance for home and business owners, as well as rapid response to the financial crisis. Currently, we are two months into the Obama presidency, and almost two years into the recession, and there have been no signs of improvement. There are however, a number of interesting points came up in the reading. The package includes a great deal of money being spent on infrastructure, long term energy projects, and drect aids to state and local governments. I believe Barack Obama is taking a Keynesan approach to the U.S. Economy, as he is investing money in the economy to turn out a greater profit, and simultaneously push the United States out of a recession. The Keynesan theory is an economic theory which advocates government intervention, or demand-side management of the economy, to achieve full employment and stable prices. President Obama is stepping in to regulate the U.S. Economy due to failure using classical economic theory. Personally, I'm worried. I think it's a bad idea to spend trillions of dollars that we don't have, in hopes to improve the nations financial situation."Despite his rhetoric tonight, President Obama cannot possibly be proud of the final result -- a bloated, trillion dollar spending bill crafted in a partisan manner that represents the same wasteful Washington spending and will fall on the shoulders of future generations."
ReplyDeletePositive:
Intends to deliver quick and effective aid to areas that need it.
Strives to help needy families
Extends the social safety net
Offers an alternative to classical economic theory
Gives money to education, the environment, energy and transportation.
Negative
Will make U.S. debt sky-rocket.
Extremely costly.
Causes parties to question Obama's bipartisianship
Will take too long to put into effect.
Question: How does Barack Obama plan to oversee the spending of roughly 1 trillion dollars? How does he plan to relieve national debt when the recession ends?