Read(or listen) to the following article. What is the problem the economists are trying to fix? What is the dilemma? How does this relate to the concept of trade-offs and opportunity cost? Which course of action do you agree with and why?
14 Comments
Daniel Salzner
8/29/2011 11:59:03 am
The problem is that the economy is dropping more and more. The policymakers strongly believe that the economy will get up again but they are worried about education of children , health care , and the aging population. They aren't thinking about saving money fast and right away, they are thinking of saving money so that the growth stays consistent. I agree with Bernanke because instead of worrying to much about if the economy is going to get up or not we should make sure that we stay healthy and educated.
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Lucas Immer
8/30/2011 12:59:35 pm
Essentially the issue here is one that has constantly repeated itself throughout history. The question: Should the federal government increase spending in order to stimulate economic growth? Bernanke and MacGuineas clearly believe that it should. While it is true that federal spending could certainly help reduce uneployment and thus boost economic activity, such a strategy contains inherent risks. Washington is already under a heap of debt and such spending would only increase the problem. Enacting these programs would force the government to trade long term economic health for a quick fix. On the other hand, not spending money on such programs will cost the economy in the short term. Personally, I would advocate limited government spending as long as we're careful not to exacerbate the problem of national debt even more.
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Madeline Oliver
8/30/2011 01:18:28 pm
From what I understand the main problem this article is addressing is that we are in need of new programs to get our economy going again, however paying for this is going to be difficult since we are already in such debt. Scott Horsley is asking the question, how do we do it without going into more debt? The dilemma here is that if the debt gets too large we will dig ourselves into a hole too abysmal to ever climb out of. We can decide to fund certain projects but the trade-off is that others will have to be cut or drawn from and someones going to need to make that decision on what to focus our efforts. The idea that i truly agreed with was in the last two paragraphs where Bernanke speaks about how politics are one of the key factors keeping the economy from improving. His point of view really makes sense because the constant fighting between political parties draws out every issue and makes it much more convoluted at time consuming to find solutions that everyone can agree on. Each party needs to put aside their massive agendas for a moment and decide on a course of action or our circumstances will never improve.
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Patty Lopez
8/31/2011 11:04:02 am
How do we maximize the potential of our economy with the money we have in our budget? This article states this problem that our country has been trying to overcome for many years now and a few solutions that have been developed. The first thing most economists will say is to create programs designed to increase stimulus programs and create jobs. The problem with this is that such programs cost a lot of money and with our budget we cannot afford to do so. If we decide to spend a considerable amount of the money in our budget on stimulus programs, and if we are faced with another economic crisis, we could be in worse shape than before- we would have nothing to help us. In my opinion, in order to save money and decrease our debt consecutively, we must balance the trade deficit. Every job given overseas means one less job here. By manufacturing more products we would create jobs as well as increase our exports. Although this would cost a substantial amount of money, it would help our economy in both the long and short run. If more people are employed, we become much more effective which can lead to a boost in our economy.
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Austin Hechler
8/31/2011 12:26:54 pm
The problem the United States government is facing is a financial debt that is getting out of control. The article proposes that our country has let the debt climb to high. Few ideas have been offered to fix this growing problem. Some economist suggest that we start programs to stimulate the economy and put people back to work. The problem with such programs is they require lost of money the United States government doesn't have. Furthermore the article states that the government funds that are colleges are leaving students unprepared. Heath care is also a costly issue the United States government faces. Although all United States citizens have health care the system is inefficient and very costly. Funding to colleges and health care funding could be cut and efficiency would increase. The cut funding could be spent on programs used to jump start the United States economy. This is a prime example of trade-offs and opportunity cost. This is an excellent example of trade-offs and opportunity cost. In order for the United States government to fund programs sacrifices or trade offs must happen in order to meet the opportunity cost. I do believe if colleges aren't teaching up to standard they must up their game, because who they train and what they train will shape the incoming generation. I agree with Katherine Baicker. If health care is such a necessity its absolutely crucial that we must develop the most efficient health care system possible. We don't need to be losing money in silly loop holes. I think Obama wanted to develop national health care and fix the spiraling down economy, but when he drew up his plans he didn't have both in mind. The economy was picked second and now its time to save as much money as we can on health care and put it towards the terrible economy. I do also agree with Mr. Goolsbee. Economist teams can draw out the most efficient plan possible but if we cant get our politics to agree in Washington then nothing will be solved. I believe a long term plan ten to fifteen years must be drawn up. The United States must also look at places where money is being spent inefficiently and develop more efficient ways to spend money and pay back our debt.
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Kenji Gutierrez
9/1/2011 09:09:42 am
The problem here is that the economy in the United States is doing terrible and we are in major debt. Economists not only want the economy to recover, but they want it done now. They are pushing for progams to fix this problem and push us back in the race. These programs will put many people back to work but will cost too much money which we don't have. The trade deficit is much too unbalanced with too many jobs overseas and not enough jobs in the states. If we were to balance the trade deficit, it would aid us in fixing the economy by making more jobs on our land and giving more jobs to our people. By giving more jobs here we would be able to produce more exportable items. We need to create more jobs to help our people, to make exportable items, and to boost our economy in the fastest way.
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Rayne Mason
9/1/2011 11:52:35 am
They've done a great analogy at making the US economy into a sick patient that's having trouble to get back on their feet and on the road to recovery. This is a perfect analogy of what's going on, and explains in detail what plans officials have of helping the economy to get back up into a running position. Basically, the US is in so much debt, it's weighing down everything that goes on. We need to find a way to lower the deficit, while simultaneously growing the economy. It's more difficult than it sounds, considering each and every plan someone would make up would each have it's own opportunity cost and a complicated cost-benefit chart. It's just a matter of our government officials making the right decision at right times to get the economy back on its feet and lower our budget deficit. Problems still weighing these (and the US) down are still very prominent as well, like untrained citizens (High School dropouts, etc) and Health Care. Some argue we must take care of these problems before we assume to help the economy, but others say the economy must be fixed before these problems can be looked into and fixed. The main goal for our government is to find a way to lower our deficit, and boost our economy to a tolerable level to increase the happiness, wealth, and wellbeing of the US population.
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Jessie Leonard
9/1/2011 12:25:09 pm
The problem the economists are facing is how to get our economy back up but to keep it up. But the programs that would greatly help, cost money and the government already has a big debt. The trade off for getting our economy back up and running is that it would put us further in debt, but I think that this spending would be good because although it won't help as much in the short term, it will greatly affect us in the long term. Also the programs needed to do this will create jobs further helping the economy.
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Maria Vittoria Gurrieri
9/1/2011 01:34:42 pm
This article deals with the hard condition of the finance of the States. During the conference are proposed some ways to solve the problem.Maya MacGuineas, for example,maintains that a long term program is necessary to revive the finance, but rightly Bernanke points out that this one leads at "an aging population, schools that leave too many students untrained, and a health care system that's both costly and inefficient". So I think that are necessary the programs proposed by Fed Chairman Ben Bernanke to put people back to work. Initially it will be hard solve the problem of the public deficit, but if these programs ensure a positive outcome, the finance will be revived and there will be a growth of the country.
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Emily O'Kelly
9/1/2011 04:11:16 pm
The economy is at a make-it or break-it point right now, and in order for the government to set it back on track; applicable budget cuts must be made. This article discusses how the economy is (finally) on it's way back up the ladder, however in order for it to flourish the government must set up programs to educate and therefore put people back to work. Obama must find a way around the cost of these programs, because they are what is setting us back into debt. The programs that are mandatory for the future success of the economy are simply becoming too expensive for the government, and this is why Obama is being encouraged to reevaluate budget cuts. This article emphasizes that our healthcare is insufficient and therefore falls under the category of "unnecessary spending". In order for our nation to have a successful future in not only the health care system but our government/economy as a whole, we must revise our spendings and sort out what is mandatory versus desirable. MacGuineas has stepped up to the plate and suggested some helpful ways in which we can improve our spending habits. She encourages only putting our spendings into "higher-value" programs, such as health care and education. The nation as a whole is just a few blocks away from economic success, however there are many obstacles in the road. In order for us to fight past these obstacles and obtain success, we must revise our budget cuts and accomplish a balanced level of spending.
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Danny Guerrero
9/1/2011 04:24:52 pm
The obstacle the US needs to overcome is a way to give the economy a kick without going into a bigger debt. Investing in programs such as health care and education would help boost our economy in the long run by creating more jobs for the US population. However doing so would cost the government money they don't have to spend, which would furthermore put us in debt. The best choice I believe we could take is to invest in these programs so more jobs are created and in the long run we'll have our economy back on top once again.
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Jenna Ramos
9/1/2011 04:29:04 pm
Despite the opinions of those who believe that the U.S economy is on the verge of an incredible comeback, America is still very much in debt and unable to agree on a plan to get out of it. Bernanke, a more positive thinker, believes that funding certain programs will create more jobs, thus stimulating the economy. However he does not list specific programs that should be funded, yet does mention that President Obama's leadership is imperative as well as Congress'. The trade off that could potentially occur with this plan of action can be even more harmful than spending money we don't have on programs that won't work. Say Obama decides to cut education's budget more than he already has to spend on a failing program. In this case, no one win, the unemployed remain unemployed, and young generations grow up without a proper education to sustain a comfortable living. However, say this plan did work, the opportunity cost would pay for itself later on if Bernanke's plan were to work, and in that case our economy would rebuild itself over a lengthy course of time. The plan of action I would take on this article is to fund these programs, specific ones would be helpful, as long as I knew there was no way that investing in them would set us back further than we already are. But that may just be the risk we have to take.
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nick harris
9/2/2011 07:03:22 am
The state and local politicians skim off too much of the money in the way of kickback. War won’t work this time either, simply because war was part of the cause of this economic disaster. What is needed is a solution that, favors businesses that build their products here over those that import them, eases the tax problems on the middle class, and increases the tax on the excess of the wealthy. Giving the majority more money to spend on products made in here will cause businesses to hire more workers. More workers will mean even more people with money to spend which will cause businesses to hire more workers. The economy will spiral upward and America will soon be number one again.
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