Th2.6: Policy Responses in the USA

Question 1

What did the USA have originally the same view as?

Answer 1

The UK in terms of a balanced budget

Question 2

However, what happened in 1932 that changed things?

Answer 2

Frank Roosevelt was elected with his ‘New Deal’ which promised public sector investment, work schemes for the unemployed and fiscal stimulus

Question 3

When did the USA reach full employment?

Answer 3

1943

Question 4

What can we say about Roosevelt’s ‘New Deal’?

Answer 4

was an example of Keynesian expansionary fiscal policy
can be argued it was not large enough to be successful, although it did have a large impact as the US unemployment figure was so high