Assume you are a professional economist and are asked to evaluate the $2.2 trillion economic stabilization...

Assume you are a professional economist and are asked to evaluate the $2.2 trillion economic stabilization package recently passed by Congress.

Outline the major features of the stabilization package.
Which features of the package make the most sense to you and you would support?
Which features of the package do not make sense to you and you think should be eliminated?
What additional features of economic stabilization would you propose that is missing from the stimulus package?

Solutions

Expert Solution

a) Aid given to unemployed which would help in replacing 100%of lost wages for workers with low income.This will increase unemployment benefit by $600 for next 4 months .It will extend by 13 weeks the unemployment benefit. There will be one time cash payment for all households which are not rich.Individuals who earn less than 75000 will get $1200 in cash and couples who earn 150,000will get $2400 and $500 for every child in the family.Small business with less than 500 employees will get loans to cover cost of payroll, rent, mortgage etc.Loans have also been given struggling industries like airlines .States and local government will get fund from the Federal government of $150 billion which is not adequate and need to be raised.Hospitals will get $100 billion in grants.Telemedicine investment which will help health sevice providers to connect withpatient through skype will get$200 billion.

b)Aid given to unemployed which would help in replacing 100% of lost wages for low income workers and includes free lancers too is the feature which makes sense to me and I support this.This feature has been elaborated above.

c)I do not support the feature of the package thatapproves $4.54 trillion for plutocracy stabilization fund..It has not been clarified how this huge amount of money will be distributed.It is understood by legislators and reporters that majority of the money will go towards giving credit to big firms.

d) Inequality in America is high and so it is necessary to take this opportunity to exploit the weaknesses of the wealthy people rather than protect them and get fairer terms for workers , customers and tax payers in the social contract of America.

Rahul Sunny answered 2 weeks ago

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