1. Mai, Ian, Emily, Maggie, Cassidy, Sunny

2. Action the government takes in the economic field.

3.  Approves taxes and expenditures  Wage and price control consent  Alter policies nominally passed by Fed. by passing laws

4.  7 members appointed by the president.  Regulate the supply of money (circulation and bank deposits) and price of money (interest rates) ◦ Buy securities: more money in circulation, interest rates drop, more borrowing money ◦ Sell securities: less money in circulation, interest rates increase, difficult to borrow money  12 regional federal reserve banks

5.  People associate economic success with government success  People hold economy in higher regard than their own finances (react accordingly)  Democrats: Reduce Unemployment  Republicans: Reduce Inflation

7.  Key to strong economy is STEADY, PREDICTABLE government, which affects economy only by adding small amounts of money. ◦ Origin: government's start and stop methods of trying to solve economical problems (welfare, printing more money)  Economist: Milton Friedman

8.  Strong economy is a perfect balance of supply and demand. Too much of either will throw it off, so it is the governments job to monitor the economy and react accordingly. ◦ Favor more active government Economist: John Maynard Keynes

9.  Belief that the government needs to be heavily involved in economy to keep it stable. ◦ Price and Wage Controls:  Government sets maximum price and maximum wage per employer  Big businesses are too easily able to respond to union strikes and inflation by raising prices on consumers.

10. ◦ Industrial Policy:  Government works to help basic industries such as steel or auto industries from getting crushed under market pressure  Economist: Robert Reich

11.  Less government interference ◦ Cutting taxes to increase people’s incentive to work, save, and invest. ◦ Greater investment leads to more jobs.. ◦ …Although tax rates will be lower, total national income will be higher.

12.  Combination of supply side economics, monetarism, and domestic tax cuts.  Result: successful, stimulated economy, but massive national deficits.  Economist: Ronald Reagan

13.  Document that announces how much the government will collect in taxes and spend in revenues and how those expenditures will be allocated among various programs.

14.  Does the government actually have control over the economy?  Was there any previously successful (or even plausible) way to manage it?  What are the causes of our current debt?  What are possible solutions to today’s national deficit of 14 trillion? (note: that’s 14 million stacks of a million dollars)