3.03 Fiscal Policy

3.03 Fiscal Policy Student Name: Arrabella Clifford Part A—Respond to the following questions regarding fiscal policy in complete sentences (Spelling & Grammar Count!!!). Red=Extra Help Items from the Instructor. 1. Define fiscal policy. Include the goals and tools of fiscal policy and the entity that controls it. Fiscal Policy is the use of government spending and taxation to influence our economy. Its main goals are to promote economic growth, reduce unemployment, and control inflation. The tools of this policy include public services and infrastructure, as well as changes in tax rates and tax policies. 2. Should Congress create a law mandating a balanced federal budget? Support your position with evidence from the lesson. I believe Congress should create a law mandating a balanced federal budget. If the Congress isn't able to create that balance in their budget they should borrow money by selling their bonds instead of taking the citizens money. In the lesson it quotes, “As a taxpayer, you are paying for the interest on loans the government takes out. Interest that the government owes on debts is figured into the federal budget. In 2020, the government used about 8% of tax revenues to pay interest on the national debt.” I feel it’s unfair to punish the people when congress makes poor decisions with our money. Part B: Scan reputable news sites for recent articles relating to fiscal policy from within the last month. Once you find and read the article, fill in the requested information and respond to the four questions that follow in complete sentences. Article title/headline: Source (URL): Date of publication: National Debt Tracker: American taxpayers (you) are now on the hook for $36,214,749,867,321.42 as of 4/24/25 US national debt tracker: See how much money the government owes in real time | Fox Business 4/24/25 1.​ Describe the fiscal policy action (Be specific with the tools – Part A question 1) that is discussed in the article, including its status (such as under debate, approved, or rejected). This article describes the scare of fiscal policy action regarding America's ongoing debt. The author quotes, “‘America’s fiscal outlook is more dangerous and daunting than ever, threatening our economy and the next generation,’ said Michael Peterson, the CEO of the Peter G. Peterson Foundation that advocates for reducing the federal deficit.” Overall, this article rejects the concept of fiscal policy because of the debt it’s causing America and its citizens. 2.​ Would the fiscal policy action discussed in the article promote price stability, full employment, and/or economic growth? Explain. (Cover all 3 based on how the tool was used and what you learned in the module). 3.03 Fiscal Policy Fiscal Policy action discussed in the article promotes price stability, considering the The article's main discussion is about the National Debt in the US and how it affects its citizens. Speaking of the article, the author discusses how “America’s fiscal outlook is more dangerous and daunting than ever, threatening our economy and the next generation," said Michael Peterson, the CEO of the Peter G. Peterson Foundation, which advocates for reducing the federal deficit.” Learning from the module, I can determine that this article wants the fiscal policy tool of controlling inflation to prevent further debate. 3.​ Would the fiscal policy action discussed in the article, if approved, contribute to creation of a budget surplus or a budget deficit? Would this likely increase, decrease, or not affect the national debt? Explain. (This is based on what you learned in the module. In General, how the tool of fiscal policy is used defines this)> The fiscal policy action discussed in the article, if approved, would create a budget deficit and would decrease the overall national debt. The fiscal policy would take control of inflation and prevent citizens from going into debt over high taxes from the government. This article talks of preventing drastic measures on taxes, and holds the government accountable for spending over their budget and using taxes from their citizens to pay for it. 4.​ Do you approve or disapprove of the fiscal policy action described in the article? Explain your response and identify at least one tradeoff (refer to question #2 & #3 for help) for your choice. I approve of the fiscal policy action described in the article I used. It prevents US citizens from paying the price of bad decisions made by the government and prevents them from taking advantage of the taxing system. One of the tradeoffs from the article is that the government can, instead of taking money from the people, sell bonds to reverse any national debt.