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Tuesday, February 28, 2012

Can one man fix a sluggish economy?

The topic I’m concerned about here is the American economy. Right now news stations (Fox news) everywhere are focusing on the presidential candidates and how one of those men is going to fix a struggling economy (if they would just be elected to office). This is not a matter of which party one affiliates with, but rather an issue of actions’ each possible candidate would take once elected to office. Technically the U.S. is no longer in a recession and has not been for some time. There has been recovery, just at a slow rate. So what happens if the candidates continue to borrow money and continue spending thereby increasing the national deficient? Incorporating monetary and fiscal policies? Doing this will help if the country is still in a recession, but it is not. An example of fiscal policy is government spending (borrowing) to stimulate the economy, but there is only so much debt even a country can accumulate before it reaches the point of no return. Or what if taxes are raised to reduce the deficit spending? Or just taxing the rich? Raising taxes is not the way to win a political race nor does the percent of tax increase cover what is needed to supply an adequate amount of revenue. Taxing the rich is a silly idea because what does “rich” mean in the first place. If you mean people making over a million dollars, and if the millionaires did not
find a way around the taxes, then the lack of them around would prove to be no benefit. So far this does not sound like an “efficient” use of government resources (under a Pareto Optimal definition of efficiency). What about entitlement programs offered by government? Cutting
down on these programs would free a large portion of funding. To address the original question, no one man cannot fix the economy but can have a strong level of influence on it.

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