Fiscal policies are used by the government to stabilize the economy. During the 2020 emergency caused by the coronavirus pandemic, the U.S. government approved a stimulus package that increased the U.S. debt.

For this discussion, first play the simulation The Debt Fixer (from the Committee for a Responsible Federal Budget), in which you make fiscal policy decisions in an attempt to reduce the U.S. debt. You can play the simulation as many times as you like.

In your initial post, include an image of your simulation report. (See Module Six Simulation Discussion Screenshot Instructions PDF.) Then address the following:

Share your experience in the simulation. What strategies did you pursue? Were you successful in reducing the debt? In your opinion, is a high national debt a problem for future economic growth? What is the ideal debt-to-GDP ratio? Research academic sources or refer to the information available through the simulation to support your opinion. Government spending increases national debt and can cause a crowding-out effect. Explain what the crowding-out effect is and why it's considered a negative effect of increased government spending. Use information from the textbook to support your analysis.

100% 90% 80% 70% 62% 60% 50% 20% 10% -1% 0% 2031 2050 Savings relative to current law (billions) $ 15020 Your Savings Defense 1340 Investments 580 Social Security 100 Health Care 2240 Domestic 590 Income Tax 2870 Other Taxes 7300