Economy & Unemployment

1. Economy & Unemployment Jessica Rubino- Mike Neluis - Lydia Jabin

2. History • Began as a farming economy in the 1776 • The Panic of 1837 • 5 years of depression • Record high unemployment • Great Depression • 1930s • New Deal • 2008 Financial crisis • GDP fell 5% in one year

3. Goals of The US economy • Stable Prices- avoid inflation and debts • Full Employment- achieve 4% or less unemployment rate and ensure equal opportunity for qualified workers • Economic Growth- to increase in Gross Domestic Product (GDP) and reduce dependency on foreign goods and services

4. Economic Policies • San Francisco’s minimum wage- $10 • This surpass standard minimum wage (national average- $7.25) • This discourages employers from hiring employees due to the increased expenses as well as discourages business from starting up within city limits. • Monetary Supply- low interest rates from Federal Reserve Bank • Implemented to counteract the Recession • This allows business to expand due to low interest rates

5. Economic Policies Cont. • America Dream 99% Act • Enacting the Emergency Jobs would boost employment by approximately 1.1 million jobs in each of years 2012 and 2013. • Continuing the Emergency Unemployment Compensation program would boost employment by roughly 323,000 jobs in fiscal 2012 and 185,000 jobs in 2013 • Reinstating the Making Work Pay tax credit for 2012 and 2013 would boost employment by 409,000 in fiscal 2012 and 532,000 jobs in 2013. • Reinstating the higher Federal Medical Assistance Percentages (FMAP) used to determine federal reimbursement for state Medicaid programs would boost employment by 349,000 jobs in 2012 • Increasing federal surface transportation investments by $50 billion in the next decade would increase employment by 47,000 jobs in fiscal 2012 and 112,000 jobs in 2013 • Defusing the automatic spending cuts currently scheduled under the Budget Control Act would boost employment by more than 1.1 million jobs in 2013

6. Economic Policies Cont. • Economic Stimulus plan of 2008 • Cost $152 billion dollars • Intended to boost the economy in reaction to the Recession • Provides for tax rebates to low- and middle income tax payers • Tax incentives to stimulate business investments • Increase in the limits imposed on mortgages eligible for purchase by government-sponsored enterprises

7. Unemployment • The percent of Americans seeking work who are unable to find it. • The Bureau of Labor Statistics (BLS) puts a number to it • 60,000 household survey each month • However, this tends to underestimate the true rate • Excludes “discouraged workers”

8. Underemployment • Includes unemployed and discouraged workers • Rises with the unemployment rate • Also determined by the BLS

9. Monitoring Money • The rise in price of goods and services • BLS kept tabs on this through the Consumer Price Index (CPI) • CPI- purchases a basket of fixed goods each month and monitors price • Each month BLS workers spread across US and purchase over 80,000 items • CPI’s goal- to create a measure that reflects changes over time in the amount that consumers need to spend to achieve a certain standard of living

10. Trends • Rose 10% in late 2009 (tends to be higher for young adults • 2010 unemployment- 9.5% underemployment- 16.5% • Sharp rise in inflation in 1973, 1974, and 1979 • Rate of inflation- 11% in 1979 and 14% in 1980 • averages below 4% in US • 2008 exceeded 5%

11. Unemployment in the US

16. Resolution • Offer tax cuts to big corporations • Requirements would be put in place to ensure the savings was translated into greater employment • Efforts to create government jobs would be made • Through creation of Government Corporations or use of private contractors

17. The Big Compromise • We would no longer implement a flat tax • Individual’s taxes will be adjusted to increase federal revenue. A minimum tax would be of 9% (below the current minimum) for all, 12% for those making $75,000 and 15% for those making $200,000 per year. This will work like the current system . For example if someone make $250,000 or more in a year they pay 9% on the first $75,000 then 12% on the next $125,000 and 15% on the last $50,000 for a grand total of $29,250 no matter what circumstances apply. • We will create programs to aid citizens living in poverty. This will help reduce the number of citizens not currently paying taxes. We hope to get people on their feet and not dependent on the governments money. • Programs such as disabled and veterans aid would not only be encouraged but created. We believe in helping those who need it and eliminating loop holes in which people can live off government with no justifiable reasoning. The federal definition of words such as disabled will be under harsh review in an attempt to give maximum aid to those in need. • Deductions will be eliminated for individual income tax. We will redirect the energy put into unnecessary deduction efforts and focus it on circumstantial aid.

18. Discussion Questions • 1. Do you believe this is a fair resolution? Why or Why not? If not what do you believe is a fair compromise? • 2. Do you believe that unemployment or the job market needs a bailout or should the government wait and see if the job market will rebound when and if the trade markets and the general United States economy pick up? • If you were unemployed what do you think you could do to improve your chance of finding a job?

19. Article • http://www.nytimes.com/2011/12/02/business/for-jobless-little-hope-of-full-recovery-study-says.html?_r=1&ref=layoffsandjobreductions • What is your solution to the unemployment issue? • What should be done about welfare? • What is one way to help gain the benefits of the previous job back?

20. Bibliography: • Censky, Annalyn. "Federal Reserve Puts Monetary Policy on Ice - Dec. 13, 2011." CNNMoney - Business, Financial and Personal Finance News. 13 Dec. 2011. Web. 13 Dec. 2011. <http://money.cnn.com/2011/12/13/news/economy/fed_rates_bernanke/index.htm?iid=SF_E_Lead>. • Edwards, Wattenberg, and E. Lineberry. "Economic Policymaking." Government in America. 15th ed. Pearson, 2007. Print • "Government Departments and Agencies | USA.gov." USA.gov: The U.S. Government's Official Web Portal. USA.gov. Web. 10 Dec. 2011. <http://www.usa.gov/Agencies.shtml>. • Moran, Andrew. "San Francisco to Become First U.S. City with $10 Minimum Wage." Digital Journal: A Global Digital Media Network. 12 Dec. 2011. Web. 13 Dec. 2011. <http://www.digitaljournal.com/article/315985>. • "U.S. Economy at a Glance." U.S. Bureau of Economic Analysis (BEA). U.S. Dept. of Commerce. Web. 10 Dec. 2011. <http://www.bea.gov/newsreleases/glance.htm>. • Censky, Annalyn. "Federal Reserve Puts Monetary Policy on Ice - Dec. 13, 2011." CNNMoney - Business, Financial and Personal Finance News. 13 Dec. 2011. Web. 13 Dec. 2011. <http://moey.cnn.com/2011/12/13/news/economy/fed_rates_bernanke/index.htm?iid=SF_E_Lead>.

21. Bibliography (continued) : •  "Economy of the United States." Wikipedia, the Free Encyclopedia. Web. 13 Dec. 2011. <http://en.wikipedia.org/wiki/US_economy>. • "The Impacts Of Long-Term Unemployment : NPR." NPR : National Public Radio : News & Analysis, World, US, Music & Arts : NPR. Web. 13 Dec. 2011. <http://www.npr.org/2011/12/09/143438731/the-impacts-of-long-term-unemployment>.