Earlier this semester, you had a discussion question on the shrinking middle class. Subsequent to that discussion question, this article, Richer But not Better Off, appeared in the New York Times. The article pretty much confirms that the American middle class is shrinking and that it is now the smallest middle class in the industrialized world. Worse yet, the quality of life for what is left of middle class is significantly below that of the middle class in the other industrialized countries. Assume that you are a challenger in a Congressional election in your district. Dr. Furfero complains to you that the current representative is doing nothing about this middle class problem. She asks you what you would do, if elected to Congress.
- Define the problem.
- Identify ONE (1) spending program that the federal government might implement to restore the middle class and improve its quality of life. Use an appropriate private market failure to justify the government's "meddling" in the affairs of the private sector.
- Identify ONE (1) change to the structure of taxes that the federal govenrment might make to restore the middle class and improve its quality of life. Use an appropriate principle of taxation to justify the government's redistribution of private sector income.