Naked Economics Chapter 8 Summary

In chapter 8, the core economic principle that displays itself often is The Consequences of Choices Lie in the Future. This principle presents the idea that what we are doing in today’s economy will have an impact on the future. Whether it is decisions on cutting benefits or raising taxes, any of these could cripple our futures economy. In the chapter, it discusses the fiscal policy and how it saved America’s economy after the depression. By monitoring the nation 's spending budget and taxes, so another depression or a recession does not occur. Before the depression, the government did not involve its self in the economy too much, which caused America 's future economy to become weak and collapse after the market crashed and many other problems. The fiscal policy was put into order to prevent the economy from collapsing and to stabilize it. The policy was used to plan for the future, which would have still been in a great depression for longer than

Year after year the national debt rises; it took America two hundred years to get the national debt to one trillion and 35 years later it stands at 19 trillion. This puts a strain on America’s future generations that will have to continue to pay interest to holders of U.S. government securities on the money borrowed from foreign countries, which they will most likely not pay off. America continues to pile up its debt without showing much concern of the consequence the nation will have to endure in the next tens or hundreds of years from now. On page 133, Slavin discusses how all Americans are taxed in order to pay off the interest of the national debt. That is money that could go towards bettering our children’s education or giving some people stability, so they could move out of poverty. We are hurting the future generations economy by allowing more people to roll over on their debt, which causes interest to rise. The government is only concerned about how it is functioning now and not focusing too much on the