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American Economy Vs Great Recession Essay

631 Words3 Pages

The American economy has undergone ups and downs deriving from an economic crisis. The Great Depression and Great Recession are two major examples of how the economy can take a massive dip, causing unemployment rates to skyrocket. When businesses suffer, they aren’t able to provide or create jobs leading to higher unemployment rates. To assist in a weak economy, government intervention may be needed to fix the circular flow. By inserting money into the economy, businesses and households will be repaired and their role within circular flow will be restored. Wartimes can also be used as leverage for creating jobs because of the production of products needed to succeed in the war. The American economy is already in a massive debt and by using government money to stimulate the economy only builds on that debt, which is a downside of government stimulation. The …show more content…

The American national unemployment rate during the Great Recession peaked at around 10% or about 15 million individuals [1]. The reaction from president Obama was to insert $787 billion into the economy via his stimulus package. This was an attempt to increase job rates, with the integration of grants, contracts and loans. Although the actions weren’t as successful as the government projected, the stimulus bill was still able to save 640,439 jobs as of October 30, 2009, which can be interpreted as underwhelming for the 900,000 - 2.3 million projection [2]. The actions from the government softened the blow for the weak economy and unemployment rates went down. If the government hadn’t been present within the crisis, unemployment rates would’ve exceeded 10% and the American society most likely would slump into another depression. Despite some doubting the success of government

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