Economic Stimulus Policy

From last fall when several companies such as Merrill Lynch and Bearstearns went into bankruptcy, a matter of common interest in the world is an economic part. This crisis is a much stronger impact than in case of Enron in 2001, and we used to compare with the Great Depression in 1930s. Many people have laid off from their workplace, also a salary for student who graduated an MBA course records the least salary in this time. So, one of the most important things for campaign of Presidency election of 2008 was the economic stimulus policy. And people in the world also have been interested in the Obama administration’s economic stimulus policy. The basic of the economic stimulus policies are to make jobs as many as possible by expanding the expenditure of a government. The focus is “HOW” they increase expenditures.
The most impressive the economic stimulus policy would be “New Deal” in the Franklin D Roosevelt administration, as we know. North America, Europe and other industrialized countries suffered from the Great Depression at 1930s due primarily to New York Stock Exchange. The campaign “New Deal” makes basically increasing a government intervention. Also, it represented the culmination of long-range trend of abandonment of “laissez-faire” capitalism. President Roosevelt stimulated U.S economy by investing

Like “New Deal,” the depression is coming companies in New York, especially in Wall Street. Then, the value of stock was dropped drastically, and many companies have been influenced this impact. So, many people lost their jobs and many families suffer from economic matters. Obama Administration also tries to stimulate the economic condition by making new jobs. According to Obama Tries to Put a Brighter Face on the Economy, “officials say they will make a carefully calibrated pitch intended to convince Americans that the administration inherited an economy in free fall and that its $787 billion stimulus package prevented another Great Depression.” Also, when Biden visited Detroit, he said that the economic condition is recovering and will be better based on the economic condition of Detroit.

I mostly agree with the policy of Obama’s administration, but I feel that they are trying to recovery an economic condition for short-term. For example, they tried to resuscitate all three auto companies, GM, Ford, and Chrysler. If a government support to all three companies, then the condition on a paper is much better than before. However, they will be content with their position and then this situation will come again. So, the government should select better companies to support then concentrate the companies which are selected. Even though the condition is much worse if one of the companies is bankruptcy, but the survivor companies will compete with other companies more intensely, then the market for survivor companies will increase and they can hire more people later.