Principles Of Macroeconomics

Try your hand at stabilizing the U.S. debt by using Committee for a Responsible Federal Budget Simulation at Read through the “Intro” and click “Next” in order to follow the simulation instructions. Answer the following questions once you have completed the simulation:

  1. Were you successful in stabilizing the U.S. debt? If not, how much of a deficit or surplus did you end up with? What does this exercise tell you about the process of creating a budget plan?
  2. Reexamine the budget cuts or increases you made. What problems would such changes pose for a politician facing reelection?
  3. This budget simulator allows you only to change spending and tax expenditures over a one-year period. This poses what problems to finding a realistic economic solution?



After doing the Federal Budget Simulation I was able to get the budget down to -800 million deficit . I can ssee this is not an easy task to do. Government officials have to look at a lot of different things and how it is going to affect people when you make certain cuts. Some of the changes I made would probably not get an official re-elected if they were done. For example I cut some things in our defense budget that most people would think would put us at risk for other nations to attack us. I increased gas taxes and lowered college cost. Although this may work for a short time in the long run this would create problems in areas of medical development, big law firms not getting all the tax breaks, and government officials not getting all the luxuries and extras they get in the form of pay increases and big bonuses. These cuts and additions I made may not be realistic but in some form I feel as though a lot of them are and if we took a hard look at what we need as opposed to who it makes happy we would be able to come up with a Federal budget. I just feel we are unnecessarily spending and overpaying for things.

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