George W. Bush's signature economic legislation signed into law In his first year as President, George W.

Fantastic news! We've Found the answer you've been seeking!

Question:

George W. Bush's signature economic legislation signed into law

In his first year as President, George W. Bush (R) signed the Economic Growth and Tax Relief Reconciliation Act of 2001. The legislation is intended to jump-start what the Administration viewed was a slowing economy. In the first part of 2001 real GDP slowed to 1.2 percent, compared with an increase of 4.1 percent the previous year in 2000, the last year of Bill Clinton's (D) Presidency. But employment remained strong with an unemployment rate at 4.1%. The Economic Growth and Tax Relief Reconciliation Act of 2001 was a major tax cut legislation and resurrected the tax policies of Ronald Reagan from the 1980s. The legislation slashed tax rates for wealthy investors pushing tax rates down to 15% for long-term capital gains and dividends. In addition, large tax cuts were given to the richest American with the top 1% of all earners gaining an after-tax income increase of nearly 10%, while those in the lowest fifth saw their tax liability unchanged. President Bush inherited a budget surplus from his predecessor Bill Clinton (D) so large that the entire national debt was on track to be paid off by 2012. Campaigning for the Presidency in 2000, Bush vowed to give the surplus "back to the people" and spur a resurgence of investment. With enactment of the Economic Growth and Tax Relief Reconciliation Act of 2001, the inherited surplus from the 1990s is gone, given to the richest Americans to spur more investment.

1A. From information in the article State the economic theory advanced by former President George W. Bush.

1B. Consistent with the economic theory supported by former President George W. Bush, construct a Macro Model of the economy at of the beginning of 2001. Label initial curves and initial Price Level and Real GDP with subscript "1" and insert potential GDP into the Model.

1C. Consistent with information in the article, set out an appropriate causal chain illustrating the economic policy advanced by President George W. Bush that affects aggregate demand. If aggregate demand is not affected by the economic policy, write "No change to aggregate demand."

1D.Consistent with information in the article, set out an appropriate causal chain illustrating the economic policy advanced by George W. Bush that affects aggregate supply and/or long-run aggregate supply and/or short-run aggregate supply. If aggregate supply is not affected by the economic policy, write "No change to aggregate supply."

1E. Return to the Macro Model in 4B and illustrate the theorized changes to the economy from the economic policy of former President George W. Bush.