April topic for POFOers only take if you are in POFO.

Practice for Nat Quals Resolved: That the Economic Stimulus Act of 2008 will successfully mitigate economic slowdowns over the next year. Observation 1-The affirmative must prove that the economic stimulus act by itself will mitigate not any other corresponding policies such as Term Auction Facility Observation 2-The resolution is that the economic stimulus act will successfully mitigate the economic down turn in the next year. You do not win simply by showing that there was some mitigation. If the government spends enough money it's sure to have some effect. It has to be successful mitigation. That means that the stimulus act has to meet the expectations/goals of those that advocated and passed it. And it has to do that in the next year 2009. Contention 1 this plan will increase the slowdowns According to the Washington post, [Dollar Falls on Fears of U.S. Deficits, Nov 5, http://www.washingtonpost.com... ] "The dollar continued its decline in global currency markets yesterday, intensifying worries among some economists that mounting U.S. budget and trade deficits could send the U.S. currency into a tailspin.", It is simple economics, when you put more money into the economy the dollar's value goes down and here is the problem with that. According to Goose, senior economist for PPI and the Democratic Leadership Council, 2007 [Austan, Why Deficits Still Matter, April, The Progressive Policy Institute, http://www.ppionline.org...], "as the risks associated with our accumulating debt grow, oil exporting countries will be tempted to sign their contracts in euro's or yen rather than dollars, as they do now. If that happens, then anything that devalues the dollar—including policy initiatives designed to reduce the trade deficit—will directly increase the price of energy rather markedly.", So very simply the tax rebates will drive up the U.S. deficit debt and because of that gas prices will go up because of the declining dollar. Gas prices cause inflation to happen and when inflation happens, prices of goods go up and people can't buy these goods. Spending will go up for a little bit, when the checks go in, but after that 2009 will be a full on depression with no spending because prices are so high. This will increase the slowdowns and will put us possibly in another great depression. Contention 2: Will lower are economies According to Orszag, Senior Fellow, The Brookings Institution, 2004 [The Budget Deficit: Does It Matter?, July 16, http://www.brookings.edu... ] "one possible outcome of a large budget deficit and a low national saving rate is weak domestic investment. That is, the budget deficit could crowd out private investment in the United States. This crowding out is brought about through higher interest rates. The budget deficit soaks up available private saving – leaving a smaller pool of national saving to finance domestic investment. The higher interest rate dissuades some firms from undertaking their investment projects, with the net result that investment declines ", So the economic stimulus act which will raise the deficit, which will cut out domestic investment. Domestic investment gives jobs to Americans, when it cuts that out; it means job cuts across the board. It will make higher interest rates, which will cause the credit crunch to become even higher and a bigger problem, then right now. By lowering the economy, rather than promoting the economy it will cause are economy, the American economy to be in shambles. Contention 3: Will hurt the world economy According to New York Times, 2004 [IMF Says Rise in US Debts Is Threat to World's Economy, Jan 8, (http://www.globalpolicy.org... ) "With its rising budget deficit and ballooning trade imbalance, the United States is running up a foreign debt of such record-breaking proportions that it threatens the financial stability of the global economy ...large budget deficits pose "significant risks" not just for the United States but for the rest of the world. the United States' net financial obligations to the rest of the world could be equal to 40 percent of its total economy within a few years...that could play havoc with the value of the dollar and international exchange rates...."Higher borrowing costs abroad would mean that the adverse effects of U.S. fiscal deficits would spill over into global investment and output,", What this means is when anything hurts the world economy, it will come back to hurt are economy. So this economic stimulus will raise the foreign debt which will cause instability in the global economy, which will plunge us into a recession and possibly the world will get sucked in as well. This act is harmful to our deficit, which will be the trigger to the big recession which will last who knows how long. It won't mitigate it will make it worse and will cause too much instability. Bascically it will raise the deficit to a huge amount and the effects of the deficit will be felt in 2009 harming the slowdowns, thus the economic slowdowns will not be mitigated it will be worse.