“Why Didn't the Stimulus Act of 2008 Generate the Desired Effects”

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Submitted By mariacfc
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“Why didn't the Stimulus Act of 2008 generate the desired effects”

An economic stimulus package, by definition is designed to stimulate a nation’s economy; therefore by its definition a nation should expect a decrease in unemployment rate, an increase in gross domestic product demand, and an increase on investments; consequently a nation’s overall economic growth.
In 2008 and 2009, different types of economic stimulus packages were introduced, all with the purpose of averting an economic recession.
My argument in this paper is that the Bush Administration bailouts and tax rebates did not stimulate the United States economy in the long-term. The Bush administration argued that by moving from a fairly free market approach position to a more governmental intervention approach, the nation was going to be able to avoid the perceived economic recession.
In my research paper I will be examining the reasons why the two most important components of the 2008 stimulus act did not generate the desired effect of stimulating the United States economy in the long-term. Secondly I will be analyzing the idea of how numerous large institutions in the United States are governing the nation not just economically but politically and how by adopting a free market policy approach could be more beneficial for the economy. Lastly, to support my argument I will be providing prevailing empirical evidence of how a free market economy is more beneficial for an economy’s long-term prosperity.
In 2008 the United States government officials foreseeing an economic meltdown implemented different strategies to stimulate the financial system, with the Treasury and Federal Reserve Deposit Insurance Corporation all working together to try to elevate the crisis. One of the measures taken to combat the perceived threat of an economic recession was the implementation of an expansionary fiscal…...

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