HGov: Fiscal Policy

Fiscal PolicyThrough its fiscal policy, Washington attempts to maintain a strong and stable economy—one characterized by high productivity, high employment, and low inflation. Fiscal policy is based on government decisions in regard to spending and taxing, which are aimed at either stimulating a weak economy or dampening an overheated (inflationary) economy. Fiscal policy is worked out through Congress and the president and consequently is responsive to political pressures. However, because it is difficult to raise taxes or cut programs, the government’s ability to apply fiscal policy as an economic remedy is somewhat limited.

1) Read Chapter 14 pp.445-474
2) Read Chapter 15 pp.481-511



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