Question 36
Long Question: Deficit & Debt
In 2011, Congress debated the wisdom of reducing the federal deficit by a total of $4 trillion by the
year 2021, while at the same time maintaining the Bush tax cuts. Would you have supported such a
proposal and why?
Question 37
Long Question: Social Insurance
What single change in government policy do you think would be most helpful in reducing poverty in
the United States?
Question 38
Long Question: Health Policy
One disadvantage to a national health insurance system such as Canadaàis that ofueuingÊpeople often need to wait long periods of time to receive desired treatments. What elements of a
national health insurance system could lead to this situation and how could this be remedied?
Question 39
Long Question: Taxation
Some people criticize the federal income tax for allowing too many deductions and exclusions. The
consequence, they say, is that people distort their economic behavior in order to take advantage of
the tax loopholes. Assess each of the following /opholes,!nd show why you think it should or
should not be retained:
a) The interest on municipal bonds is not taxed.
b) The interest component of home mortgage payments is deducted from income, so that no taxes
are paid on it.
c) Property owners are allowed to deduct %preciation expenses&rom their income, even though
the value of their property may have increased, not fallen.
d) Medical expenses above a minimum are deductible.
Question 40
Long Question: Stimulus
What sort of fiscal policy is appropriate for the economic conditions facing the country today?

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