These have been extracted by Dr. Kay Strong from her students' work and are provided as an appendix to her case study, "Use of Portfolios for Assessment in Introductory Economics".
Economics is the study of how people interact with their environment to provide material (goods and services) that we need and want. This was one of the very first things that I have in my notes from the start of this class in August. My newly unrefined definition is the study of how the decisions we make determine the consequence of how the entire world's energy and resources are divided up in order to make the whole world flow. Whether that decision is to start a business or look for a job, get married, buy a new sweater, or make a phone call, everything we do has a dollar amount attached to it. Gained or lost, money is the bottom line for many of our life's decisions.
Prior to this class, I assumed economics was for the people in dress suits on Wall Street. I never cared much to learn about unemployment rates, for example, because that was something that never affected me. Now, I realize that I couldn't have been more wrong. Many times, since I have been hired, people have been laid off at my factory, and it always occurs around January. This is because many of the factories that we supply close down for a few weeks to a month due to the slowdown in car sales. What happens prior to January that makes such a drastic dent in wallets every year? Could it be the holiday season sucks everyone dry and it takes awhile consumers to get back on their feet? It could be one factor. Layoffs are already planned for some plants that we support, and a slow down in overtime is forecasted for our plant.
I now pay more attention to economic reports that I see on the news or in the papers because I understand the basic concepts that they are talking about. I don't just hop right to the comics anymore, and I actually flip through the Money and Business sections! I feel that it has expanded my knowledge base to be able to speak more intelligently about economic topics when they come up in conversation. I play the devil's advocate with people to see if they can notice the whole picture of a news story instead of just seeing it as one person in small town USA.
I also feel that this class has opened my mind to new possibilities. Realizing that what might be great in the here and now might be bad for the long run. For example, the wonderful tax money that we got back last year. Sure it was great to have an extra $300, but in the long run it did not really have the affect on the economy that it was planned to have. Worse, the government is now facing quite a large deficit and could have used that money in the fight over sees.
I had no idea of how much information the web can really provide for you if you look for it! I must admit that I used to get online check my email and then get offline again. I never really surfed the web as much as I have in the last few months. I have learned a great deal and have even passed on some information to people at work and family. So many interesting facts are out there if you just look for them. Unless you research both sides of a story you may never come up with how you really feel about a topic.
I feel that my writing and vocabulary skills have been sharpened. Working in a factory you tend to use poor speech, and very rarely do you pick up a pencil to write anything but your name. This class gave me an avenue to be creative and use my brain to think in ways I usually don't have to think. Even in my other classes I could easily memorize data and information for exams that is just as easily forgotten. In this class we were challenged to apply the data to our every day lives making it a part of who you are. This kind of learning is a lot harder to forget.
There is an enigma to the study of economics: while it seems simplistic in design, weighing costs and benefits to find solutions to macro-level problems, economics is also very personal. This was a great surprise I found in this class.
Consider poverty and public assistance, an issue many disagree on. While government websites can spew out statistics and policy solutions, and textbooks can define the reasons behind poverty and draw nice curves showing the distribution of income in various nations, it still comes down to people and families. What possibilities await one family who can be lifted from impoverished conditions, and what possibilities await a country whose future livelihood depends in part on the children within that impoverished family? Federal and state budgets are another conflicting matter: what child will go to class hungry when government cuts school breakfast programs, or whose car will need tire replacements when budgets fail to appropriate enough to maintain roads? Can we really put a price on a child’s life for the issuance of airbags in cars, and who will determine the price tag, the parent or someone sitting behind a desk at an insurance company? Individuals are grossly affected by studies in economics.
To examine policy at a macro-level can be awesome: the natural balances found in such things as wage equilibriums and how many pizzas Dominos should be making, appears to be as forceful as any natural occurrence. To make policy at a macro-level, on the other hand, must be some sort of hell reserved for politicians: knowing that every dollar one appropriates, every trade treaty one signs, and every pre-decided maximum penalty for crimes committed can have an enormous impact on just one individual is a terrible responsibility. It is an awesome power, and not one that lets people sleep peacefully at night.
I am yet undecided whether I enjoyed this class. If ignorance is bliss then I am in agony, for I might have received less of a fright watching old “Tales from the Crypt” reruns. Happy or not, my appreciation for the study of economics has grown considerably, as I used to believe it was a subject found only in the business section of newspapers, rather than a tool used in many areas of life. Criminal activity, for example, is moral issue, but one that finds its roots in cost/ benefit analysis, for if we raised the costs would the activity be deemed profitable? Or on the flipside, if we pull the morality out of the equation, what would the benefits be? Policy isn’t always about money spent and results from that spending, but can also be where we as a society, at a given time, desire control over certain behaviors.
One of the greatest conclusions I have come to, in completing this class, is that government is not always a good thing. Yes, it serves some purpose and offers some services that would not else be available, but the costs to which government extracts for their services is far too high. As noted previously, policy making is an awesome power, blend that idea of power with billions of dollars, a tablespoon of moral ideals and a pinch of elitism and policy makers start believing they’re playing God. Theological arguments aside, there are two main difference: One, God knows His outcomes before His actions—Government does not have that ability, and never will; two, when Government intervenes, their actions typically produce some unintended results. Government makes too many value-based judgments, although ideas of value are often defined by us, the voters. It is not good economic policy to spend tax dollars to save family farms, but we do because we find security in memories of summers at Grandpa’s farm and gawking at ponies at a roadside fence during Sunday afternoon trips. It is not good economic policy to levy high taxes on imported steel, yet we do because we uphold American union organizations as a great pastime, second only to baseball. Morals and ideas of value do not mesh with economics, yet Government tries to blend the two.
With that idea arises a new question: whose perspective should be followed in regards to policy making? From Governmental economic advisors, to steel workers, to welfare recipients, there are far too many sides of an issue to find compromises, and people’s perspectives are far too unstable. When I take off my Student Hat, and place on my head my Church Hat, there is an innate pro-life perspective, even though my Student Hat tells me that the costs of illegalizing abortion is far greater than any personal benefit I might extract from such policy. When a worker in Washington takes off their Government Hat and visits an elderly Aunt in a nursing home, their perspective on the costs of Medicaid and Social Security might be minimized when they see first-hand the benefits of these programs. If one person cannot always decide whether the costs of a societal issue outweigh the benefits one reaps from it, how on earth can 535 Congressional members plus an Executive office-holder do so?
Finding solutions and analyzing information in print can be an enormous task itself with all the data we have ready for viewing on the Internet. However, too much of this information is contradictory, and even within Government sites there are discrepancies that must be hunted down, such as the spending of the Social Security surplus for 2003 and a true figure on what war with Iraq might cost. Furthermore, the dollar figures in Government spending are simply too high to fathom: visualizing a trillion dollars is like staring at an abstract painting, you can look at it, but you cannot always see the form and structure it takes.
Economics shouldn’t be abstract, but a simple study of resources and the best possible way to use them. However, first it must be decided when it is best to allow markets to find their own natural equilibriums and when it is best to ask for Government intervention.