Problem:
Describe fiscal policy and how it relates to todays economy (in your own words and with references). I need to understand it better and right now I am having a hard time applying/relating it to todays economy. These are some questions I have in my book as practice questions that I do not understand. I have the answers but the book does not elaborate, please elaborate on how you came to your conclusions.
The White House estimated in August 25, 2009 that the estimated 2009 federal deficit will be $1.58 trillion. This is 11.2% of GDP, the highest in all history.
Is this bad or good for the economy today and the next 10 years?
What is the history of fiscal deficits in the U.S.?
What are the lessons of past fiscal deficits that we may apply today?