Wednesday, February 14, 2007

A Picture Can Save a Thousand Words

Robert Samuelson is one the country’s foremost economics journalists. In the current issued of Newsweek he has an article that is worth reading before you study fiscal policy, budget deficits, and the national debt, topics that are covered in Chapters 14 and 15 of your text.

Samuelson’s article focuses on the attached chart called “Shifting Priorities”. The pie chart compares the composition of federal government spending in 1956 and 2006. There has been quite a change in the face of federal spending.

Samuelson maintains in the article that:

“It might help if Americans called welfare programs—current benefits for select populations, paid for by current taxes—by their proper name, rather than by the soothing (and misleading) labels of "entitlements" and "social insurance." That way, we might ask ourselves who deserves welfare and why. We could consider all of federal spending and not just small bits of it. But most Americans don't want to admit that they're current or prospective welfare recipients. They prefer to think that they automatically deserve whatever they've been promised simply because they've been promised. They do not want to pose the basic questions, and their political leaders mirror that reluctance. This makes the welfare state immovable and the budget situation intractable.”

Extra Credit: Briefly explain why Samuelson maintains that “both liberals and conservatives, in their own ways, peddle phony solutions” to the budget deficit problem. If you are the first student to send me an e-mail ( with a plausible explanation, you will be rewarded with two extra credit Discussion Board points. Only one blog extra credit question per student can be answered in any given week for Discussion Board extra credit.

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