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Chapter 17: Economic Policymaking

Get Connected

Get Connected

This activity contains 2 questions.

	Instruments for Controlling the Economy, Part II The most important player in our nation's economy is the Federal Reserve. The Federal Reserve controls the supply of money. When money is hard to come by its value goes up and this is reflected in higher interest rates. When money is easy to come by its value goes down which is reflected in low interest rates. Let's get a sense of just how the Federal Reserve operates. Search Tips Go to http://www.federalreserve.gov/ and click on the "FAQs" link. Read through the questions. Questions to Ask Who owns the Federal Reserve? Could you have an account there? Does the Federal Reserve produce currency and coins? What does it produce? How is money placed into circulation? Why it Matters Many people consider the Federal Reserve to be one of the most powerful institutions in the world. What the Federal Reserve does often effects the economies of most countries of the world. Get Involved Keep track of the activities of the federal reserve for the semester and see if you have a better understanding of the economy as a result.   To create paragraphs in your essay response, type <p> at the beginning of the paragraph, and </p> at the end.

	Arenas of Economic Policy There are three major actors in economic policy – business, consumers, and labor. Labor organizations advocate on behalf of workers and often find themselves at odds with business over public policy issues. In fact, both business and labor try to get the government to pass laws and make regulations that favor them (and hurt the other according to each). Let's see what labor is interested in right now by going to the American Federation of Labor and Congress of Industrial Organization's web site. Search Tips Go to http://www.aflcio.org/issuespolitics/politics/ and review the issue topics on the left hand side of the page. Click on "Minimum Wage" and review the links. Questions to Ask Why can't the minimum wage keep a family out of poverty? What effect would raising the minimum wage have on business? Who are low wage workers? Would most Americans support an increase in the minimum wage? Why it Matters Labor and business often find themselves at odds over public policy related to the economy. When one wins, the other feels like it loses. Get Involved What does the rest of the class think about raising the minimum wage?   To create paragraphs in your essay response, type <p> at the beginning of the paragraph, and </p> at the end.

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