ECO 202
Years 2000-2010
Joshua Taylor
ECO 202
Milestone Two
ECO 202
1
Fiscal Policy
Contractionary Fiscal Policy leading into the 2000’s in the Clinton Administration
Raised Taxes
Cut spending by reforming TANF program
Implemented NAFTA
Expansionary Fiscal Policy starting in 2001 with President Bush
Tax relief for recession
ECO 202
During the time with Bill Clinton, he implemented contractionary fiscal policy. He raised taxes across the board, cut spending by reforming the TANF program, and implemented NAFTA (Amadeo, 2017). Early in the decade, President Bush used expansionary fiscal policy to help the economy during recession 2001
2
Fiscal Policy Actions
This rubric element wants you to examine what the fiscal policy initiatives were going forward to respond to the changing economic landscape.
You should specifically state what the intent of the actions was—for instance, it could be to decrease unemployment.
Then, use our macroeconomic principles and models (like the AD-AS model or Keynesian consumption function) to explain why the action would lead to the outcome desired by the government.
Keep the main points (and any use of graphs to show the economic models) on the slide, and use the speaker notes to add full explanation.
Scholarly research is required here as well (this may overlap with research from the previous element, as appropriate).
ECO 202
3
Fiscal Policy Impact
After looking at what the government set out to do and why, you will now examine whether it actually worked.
You will look at the macroeconomic data (which you already gathered in Milestone One) to see if policy actions achieved their goals. For instance, President Johnson’s “War on Poverty” aimed to reduce poverty in the U.S. and, in doing so, create a stronger economy. With less poverty, we should see increased consumption and higher growth rates.
Keep in mind that there may be times when the government misread the economy and implemented a policy that had unintended effects, so it is important to compare what was observed after the policy in the macroeconomic data to what the policy objectives were.
ECO 202
References
Amadeo, K. (2016, October 19). What Was Obama's Stimulus Package? Retrieved January 19, 2017, from https://www.thebalance.com/what-was-obama-s-stimulus-package-3305625
Amadeo, K. (2017, January 21). Compare Obama vs Bush on Economic Policies and the Debt. Retrieved January 28, 2017, from https://www.thebalance.com/how-do-obama-and-bush-compare-on-their-economic-policies-3305622
Amadeo, K. (2017, January 21). President Bill Clinton's Economic Policies. Retrieved January 27, 2017, from https://www.thebalance.com/president-bill-clinton-s-economic-policies-3305559
Dubay, C. S. (2013, February 20). The Bush Tax Cuts Explained: Where Are They Now? Retrieved January 28, 2017, from http://www.heritage.org/research/reports/2013/02/bush-tax-cuts-explained-facts-costs-tax-rates-charts
ECO 202
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