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Published byNorman Tucker Modified over 9 years ago
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Monetary Policy By: Ryan Ferguson and Jaye Mitchell
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Problems Unemployment lingering around 10% Decline of hiring and investment by small businesses Bad Investments, throwing the government’s money away- 12 trillion dollar debt Lack of energy efficient and clean energy manufacturing jobs
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Obama’s Proposal: Main Elements Create new jobs instead of save old ones Tax incentives that encourage small businesses to hire more workers More spending on infrastructure and other large projects Rebates for consumers who invest in energy saving improvements for their homes To use 70 billion dollars of the leftover 200 million dollars from the TARP program
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Proposal B Senator Jack Reed of Rhode Island (D) and Representative Rosa DeLauro (D) proposed bills to expand state existing work-sharing programs Based on German economic policies that encourage businesses that face a temporary decrease in demand for their products or services to avoid laying off employees by trimming the hours of all employees Government funded work-sharing program would be cheaper than paying unemployment to those out of work
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Other Proposals Eliminate Job Killing Federal Tax Increases Reform the unemployment system to help out those out of work find jobs and lower federal payroll taxes to assist in hiring Expand U.S. Export Jobs
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Politics Trying to please both Republicans and Democrats Split the difference with what he is doing with the money Half the money goes to deficit reduction, half goes to job growth Part supply-side economics (Business Leaders), part Keynesian
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Politics (Continued) Polling Report: Public disapproving of Obama’s handling of economy (54%), public disapproving of Obama’s handling of creating jobs (59%) Also, it seems that Americans believe that cutting taxes would do more to create jobs than Obama’s job creation program would
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Politics (Continued) CNN Poll: (74%) of the public believes that creating jobs should be the most important to the Obama administration, while (57%) of them want the government to stimulate recovery at the same time Interest groups want to be given more money to be distributed to workers, or keep more of their money by having lower income tax rates
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Policy Window This policy has a great chance of becoming an actual piece of real policy but it could change quite a bit while in Congress Bill lacks necessary funds to make much of a difference given the size of the unemployment problem It does not create jobs directly, relies on people to act on incentives
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Policy Window (Continued) Lawmakers have 200 billion dollars burning a hole in their pocket Business Leaders expressed their need for a policy like this last month at the White House Jobs Summit Urgency for this stems from concerns that lost payroll jobs will never return and that temporary, or just-in-time, hiring may become the norm
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Policy Window (Continued) Unemployment in the double digits Estimates say that if nothing is done, it could take more than a decade to restore jobs lost in the recession 65% of all new jobs in America created by small businesses
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