ECO 203 Week 3 Assignment The Debate Of The Budget Deficit Essay

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The Debate of the Budget Deficit
Tinda Reagan
ECO 203
Instructor Bergan
June 1, 2015

The budget deficit is something the U.S. economy has been plagued with for a little over 30 years. The budget has always been there but between 1980 and 1993 the budget deficit grew in dollar amounts and the national debt tripled (Amacher & Pate, 2012). The next few paragraphs will discuss the steps taken to help the budget deficit in the earlier days and where the current economy stands. During the years falling between 1980 and 1993 the economy suffered from two recessions, the first 1980-1982 and the second during 1990-1991. The budget had been a concern since the 1980 and in 1985 Congress passed the Gramm-Rudman-Hollings Act. According to Amacher and Pate (2012), the act set a timetable for reducing deficit from over $200 billion in 1986 to zero in 1990. When targets were not meet painful cuts in federal spending was to occur, but unfortunately the act was based on projected budgets instead of actual ones. The economy experienced the most economic growth in U.S. history during the 1990s to early 2000s. The recession that occurred within the years 2000 and 2001 was brief, but within 10 years the economy suffered the largest recession since World War II, this recession is referred to as The Great Recession it began in December 2007 and end June 2009. This recession resulted in The American Recovery and Reinvestment Act of 2009 was intended to save and create jobs almost immediately, as well as provide relief for those most affected by the recession. It also proposed to invest in the country's infrastructure, education, health, and green energy. Although the National Bureau of Economic Research marked June 2009 as the end of the Great Recession, lingering effects such as high unemployment continue to plague the United States well into 2012 (Amacher & Pate, 2012). Now 2015 and the economy is still in a downward spiral with no end in sight. According to Cohen (2013), republicans want to balance the budget, solve long-term debt, and unlock energy sources while President Obama has no interest in resolving any of this issue. President Obama released his annual budget in February 2015. The $4 trillion budget proposed by President Obama would:
Increase the Pentagon’s budget by $38 billon
Expand and extend tax credits for parents paying for child care, college students paying tuition, and low-wage childless workers
Help pay for preschool for 4-year-olds form poor or middle-income families
Begin a four-year program to improve roads, bridges, and railways nationwide
Extend unemployment insurance
Devote $215 million to research what’s known as “precision medicine” which involves using patients’ genetic information to tailor medications specifically to their bodies
Set up dedicated fund for fighting wildfires (Ehrenfreund, 2015).
Congress has until October 1, 2015 to decide how monies will be spent in the new fiscal year. Republicans are