"9/11 and the Economy"

Introduction
Students have read the information in the text about the September 11th terrorist attacks and the government's War on Terrorism. In this activity students will learn about the economic challenges the government faced shortly after the attacks occurred.

Lesson Description
Students will review a press release from the White House Office of Management and Budget that discusses the need for the government to be fiscally responsible when trying to stimulate the economy. They will learn about the economic stimulus plan, airline industry support, and the importance of being fiscally careful. Students will then answer four questions about this press release. The fifth question requires researching how the federal government bailed out the airline industry and analyzing whether they thought the government did too much or too little.

Instructional Objectives:

1. Students will learn how the government plans its budget for a crisis.
2. Students will be able to use this knowledge to determine whether the government effectively deals with economic crises.

1. Because of the terrorist attacks and the declining economy, many in Washington were willing to spend heavily. This created a great risk of runaway spending, which could increase the size of the government and eliminate surpluses. In fact, many were already trying to get government funding for many projects not necessarily related to terrorism or the economy.
2. The stimulus should be kept to between $60 and $75 billion. It should be primarily of tax relief to balance the billions in spending already enacted; neutral across industries, not sector-specific; and of limited duration. Government budgets should return to surpluses as soon as possible in order to continue debt reduction and to secure Social Security and other objectives.
3. To support the airline industry, the government provided enough cash to keep the carriers flying. In addition, federal loan guarantees were established for carriers able to demonstrate a strong prospect of success.
4. Lesser priorities are secondary and may have to wait until the primary objectives are achieved. If the government does not take this logical approach, serious economic disorder could result.
5. Student memos will vary in content. Students should use the White House Web Site and the Office of Management and Budget to learn about the airline bailout. They should then write a clear concise memo to the president explaining their opinion about government policy toward the airlines. The memo should address concerns that the government might be spending too much money.