United States Economic Policy

Economic policy is based on three main area which are Fiscal policy, Monetary policy, and Trade policy. Fiscal policy is based on government decisions in regards to a country’s taxing and spending. This means that if the government plans to raise growth in the economy they would increase spending on goods and services. By doing this it will also increase demands for goods and services. Since demand will be going up production must go up, so if production goes up that mean companies might need to hire more people. People that were once unemployed will be able to have the opportunity to have a new job now. While jobs increase that mean, they will have money to spend on their needs. This will increase the demand rate and require more production.

If the government decreases spending then demands will decrease also in the economy. With demands decreasing business will slow down production, which means less less people would be hired and less investment. This means the people will have less money to spend of goods in other people stores. Monetary policy refers to the setting of interest rates and buying and selling bonds in the market in order to influence the amount of money available in the economy. This is a way that the government attempts to influence the economy by controlling supply or the amount of money in circulation. Trade policy handles the laws regarding the exchange of goods and services with other nations. Many American companies depend upon the United States government to protect their industries against foreign competition. United states regulation is largely set at state and federal level. Congress has the ability to regulate trade, set tariffs and protect domestic business. they have created an environment which makes it easy for foreign markets to accept U.S. imports. Executive branch has a huge impact on

With the economy growing in China it has lead some of their people out of poverty. As years progress more jobs are being created in China because of people demands from the United States. “China's economy has grown enormously over the past three-and-a-half decades. Its gross domestic product (GDP), the most common measure of economic output, was $10.4 trillion in 2014, making it the world's second-largest economy--only the U.S. economy is larger.”(Jingyi Jiang). People wonder if China relies too much on export. Some think that they do because China has spent over 2 trillion dollars in the last eight years or so trying to buying up foreign exchange reserves so that they could keep the value of the currency low. Instead of China spending there money on trying to keep the values of the currency low they could have took that money and invested elsewhere in the chinese economy. People believe that China need to make a shift from depending on exports to depending more on growth based on domestic demand for goods and services within China . The best way to do that is to allow wages to rise for chinese workers so they could be able to buy the goods they are producing. “Late summer devaluations of the Chinese currency, the renminbi, sent tremors through the global economy, including stock markets in the United States and other countries.” (Martha