In this new edition of his classic text, Laurence Seidman refocuses on important economic issues the United States faces in the twenty-first century. Writing in a conversational style, he introduces professor-requested supply-and-demand and production possibility-frontier diagrams to illustrate the updated micro- and macroeconomic topics. Using parables to present economic lessons, this third edition includes sections on combating recessions and the free market, as well as updated material on new individual accounts under Social Security. New to this edition are discussions of the tax credit approach to encourage the purchase of health insurance and the latest changes in the earned income tax credit. Revised to facilitate the needs of teaching introductory economics, each chapter advocates a specific economic policy to illustrate the particular issue under discussion, and to provide an opportunity for debate and discussion. Topics covered include taxation, social security, international trade, the environment, health care, education, investment, and other issues.

This work includes sections on combating recessions and the free market, as well as updated material on the pros and cons of establishing new individual accounts under Social Security. It also includes a discussion of the tax-credit approach to encourage the purchase of health insurance.

This timely book offers bold new fiscal policy options that can complement current automatic stabilizers and counter-cyclical monetary policy to combat recessions. Dr. Seidman acknowledges that most economists are justifiably skeptical of Congress's ability to implement discretionary counter-cyclical fiscal policy in a timely and effective manner, as indicated by the government's heavy reliance on monetary policy to stabilize the economy in recent decades. He argues for an independent fiscal policy board or the Federal Reserve to decide changes in the magnitude of Congress's fiscal policy package of stimulus or restraint. Any recommendations would go into effect immediately without a congressional vote, subject only to congressional override. With thought provoking proposals like this, Dr. Seidman provides a fresh look at practical fiscal policy tools based on the most prominent research in the field.

This timely book offers bold new fiscal policy options that can complement current automatic stabilizers and counter-cyclical monetary policy to combat recessions. Dr. Seidman acknowledges that most economists are justifiably skeptical of Congress's ability to implement discretionary counter-cyclical fiscal policy in a timely and effective manner, as indicated by the government's heavy reliance on monetary policy to stabilize the economy in recent decades. He argues for an independent fiscal policy board or the Federal Reserve to decide changes in the magnitude of Congress's fiscal policy package of stimulus or restraint. Any recommendations would go into effect immediately without a congressional vote, subject only to congressional override. With thought provoking proposals like this, Dr. Seidman provides a fresh look at practical fiscal policy tools based on the most prominent research in the field.

A serious consideration of the debate on social security reform that is taking place in many countries around the world. Professor Seidman advocates the concept of 'funded social security' as a middle position between pay-as-you-go (PAYGO) social security and privatized social security, and constitutes a politically strategic alternative. His analysis covers two distinct components, fund accumulation and portfolio diversification. The concept of funded social security uses a mix of payroll taxes and portfolio investment income to finance benefits. With funded social security, the government contracts with private investment firms to manage the portfolio of the social security trust fund. It is entirely a defined-benefit plan without any individual defined-contribution accounts; each retiree's benefit is linked by a legislated formula to the retiree's own wage history. The benefit is an annuity - an annual benefit that continues as long as the retiree (or spouse) lives - and is automatically adjusted annually for inflation.