1. With regard to the US Federal Budget exercise (2 above) describe your projected spending and tax choices for 2015. What was your budget deficit for 2015? Be sure to include any changes that you made to Social Security.
2. With respect to Federal Budget Challenge (3 above):
-Summarize the budget policies that you implemented to achieve your results with regard to specific areas of the budget: Social Security, Medicare, defense, etc. Discuss your spending as compared to the most popular choices and the status quo.
-Discuss your choices with regard to revenue. Did you cut tax expenditures, implement tax reform, etc. How do your choices compare to the popular choices, and the status quo?
-Report the total deficit reduction that you achieved upon finishing the Federal Budget Challenge? What was your total spending and revenue?
-Did the choices that you made in the Challenge tend to be “popular” or unpopular? Were your choices based on economic reasoning?
-Please attach the summary/screenshot of your results from the Challenge to your post. You can take cell phone pics of your results, and collect them in a Word or PDF file if you like.
3. Utilizing economic reasoning (the art of economics) explain how you would “fix” the Federal Budget. Discuss your views regarding future budget tradeoffs. Where would you make major cuts and why? For example: Should additional tax revenue be used to reduce federal borrowing? Should the federal government invest more in research and development? How should we secure Social Security and Medicare for future generations? Should we increase or decrease national security funding in the years ahead?
4. Do you find yourself more sympathetic to the “sound finance” or “functional finance” view as outlined in Chapter 16? Why? Discuss at least two policy changes that could reduce the real burden of the debt on future generations over time. What will happen to the Federal Budget if the Federal Reserve allows interest rates to rise to more “normal” levels? Explain.