Business Economics - You Decide

Mr. President,

After consulting with our experts, my recommendation is to focus on lowering current interest rates, increasing government spending and tax cuts in the short-run. Allison Tanney suggests, and I agree, that we need to get congress on board and increase spending. This expansionary policy will stimulate job growth when used properly. She also recommends lowering taxes, and I agree, but I believe we should do this for only a short period on time; a year or two at most. Lowering taxes will spur consumer consumption because they will have excess cash flow; however, if we leave taxes too low for an overly extend period of time the government will have difficulty paying its bill.

As for monetary steps we can take, I have put together a recommendation to send to the Federal Reserve with your approval. Completely contrary to Patricia Lopez’s advice, I stand behind Mrs. Tanney and Mt. Burke’s endorsement of having the Fed lower interest rates to encourage money borrowing and help combat our -2.4% inflation rate. However, I think this will be more successful in the long-run so I believe we should also have the Fed begin buying back bonds. This will immediately increase the money supply. We can also suggest that they lower the reserve requirement but leave it up to their desecration because I don’t believe it is currently necessary.

After we see the positive effect of our expansionary efforts I believe we should follow Kathy Lee’s advice and raise taxes and begin rolling back government spending back to their initial levels. While her suggestions were not helpful to our current economic situation, I believe it will be effective to recover the money spent on job creation efforts. These steps should be staggered so as not to put too much strain on the American people.

To recap, I recommend we begin pursuing aggressive expansionary fiscal and monetary policies to fight unemployment and to encourage economic growth. Increasing government spending and lower...