ECON 290 uses the tools of economics to examine decision-making in non-market institutions with a particular emphasis on government decision-making. For the class, students will select topics to write on and it could be a decision or policy from the federal government (like trade policy), state government (like tax policy), local government (like education policy), a charity (like what causes to support).
A simple example:
Week 2: Milestone 1
A policy or topic to consider is one currently being debated in the California legislature: California is working on a policy to pay people to stay sober. According to the Association Press (2021), this policy is not new as the federal government has been doing it for years with military veterans and research shows it is one of the most effective ways to get people to stop using drugs like cocaine and methamphetamine, stimulants for which there are no pharmaceutical treatments available.
Week 4: Milestone 2
This policy also called “contingency management” allows people to earn some incentives or payments for every negative drug test over a while. Most people who complete the treatment without any positive tests can earn a few hundred dollars. The money would be given in form of a gift card. This is important as incentives are one of the core concepts in Economics. According to Lumen (2021), Expectancy theory, suggests that behavior is motivated by anticipated results or consequences. The theory proposes that a person decides to behave in a certain way based on the expected result of the chosen behavior. For example, people will be willing to work harder if they think the extra effort will be rewarded.
People struggling with addictions, hospitals, families of people with the addiction as well as the state are interested parties for various reasons. For example, according to the Associated Press (2021), California has struggled with opioid abuse, including drugs like prescription painkillers and heroin.
The proposal has already passed the state senate with no opposition and is pending in the Assembly, where it has a Republican co-author (Associated Press, 2021)
Week 6: Milestone 3
The program would cost an average of $286 per person. With the overdose deaths from stimulants in California nearly quadrupled between 2010 and 2019, the trend shows an increasing number of cases. According to Associated Press (2021), preliminary data from the first nine months of 2020 when much of the state was locked down because of the coronavirus shows stimulant overdose deaths jumped 42% compared to 2019. While this may enjoy some level of success, it is not perfect and does not work for everyone.
Week 8: Milestone 4
Drug counseling, meetings, and pharmaceuticals have limited success for people struggling with addictions. This options tied to monetary incentives may be effective in helping people curb their addictions. Financial incentives do not always work especially if the will or the amount is not financially inviting or encouraging. A better option is to combine all the tools including attending drug counseling, taking effective drugs to help with addiction together with contingency management. Mandating a negative drug test as well as proof of attending an addiction counseling and meeting will be a much better plan rather than just requesting for a negative test.
References
Associated Press (2021). Associated Press (2021). California Wants to Become the First State to pay people With Addiction to Stay Sober. Retrieved from https://www.npr.org/2021/08/26/1031220835/california-bill-treatment-addiction
Kristin Loewen
ECON 290
Dr. Jeff Bajah
September 4th, 2022
The Economy and the CARES Act
What are the rules of the organization that influenced and impacted the decision, policy, program
The organization of the CARES Act appears to be congress itself. The policy was influenced by the need to stimulate cash flow into the US economy during times of crisis (Congress, 2020).
What are the compromises and being made? Is there resistance to the policy? How stable is the policy? Could it be changed with just a few votes?
The compromises of the CARES Act primarily consist of constant extensions of the Act beyond its original period of three weeks (Congress, 2020). Initially, the act was supposed to be suspended after the first round of lockdowns (Congress, 2020). However, it was repassed into law again in 2021 (Congress, 2021). Initially, the bill began with bipartisan support and passed quickly through Congress, however, it diminished after the bill continued to be passed (Saad, 2021).
How did those impacted by this decision have input into the decision?
The voters had input into this decision by their vote and held interests in Congress.
Which groups or people are most impacted by these decisions or policies?
The groups of people most impacted by the policy were supposed to be the families that were out of work. Chris Bell, partner at Moss Adams Healthcare Practice states that “The CARES Act is intended to help individuals and businesses access cash flow during these difficult times” (Bell, 2020). The bill then was formed to stimulate cash flow within the U.S. economy during the lockdowns. It was to pass to families who were out of work (Bell, 2020). The bill also gave money to museums and art institutions for the initial bill and was given an estimated 100 million dollars (Congress, 2020).
What are some of the unintended consequences of these decisions or policies?
According to a study done by William and Mary, some of the unintended consequences of the CARES Act would be civilians borrowing money from the government in order to simply make bank (Hojnicki, 2022). All one had to do to apply for the CARES Act was to fill out a form claiming that the lockdowns had negatively impacted a business or income (Hojnicki, 2022). In order to prevent these steep sums were enforced near the end of the lockdowns (Hojnicki, 2022). Another question that this study attempted to answer was what people would do with the money they received from the CARES Act (Hojnicki, 2022). They found that most people would save their money, invest it, or pay off other debts (Hojnicki, 2022). If the investments went well it would work to pay back the CARES Act, but if not, it would “result in a very expensive bailout for stockholders” (Hojnicki, 2022). This study was conducted to hopefully stave off unintended consequences in the future (Hojnicki, 2022).
Is there a voting aspect to this policy? If not directly maybe indirectly (maybe there was not a vote about the actual policy but the decision makers were voted on)
Yes, it was an indirect vote of the people through congress.
What were the elections like? Are the decision makers truly representative of the group (even if there was not an election)
I am not quite sure yet.
What are the compromises and being made? Is there resistance to the policy? How stable is the policy? Could it be changed with just a few votes?
Initially, the bill began with bipartisan support and passed quickly through Congress, however, it diminished after the bill continued to be passed (Saad, 2021). The longer the bill remained in circulation the more split down partisan lines it became (Saad, 2021).
Do some involved seem to have a disproportionate influence on the outcome? If so, who and why?
I am not quite sure yet.
References
Bell, C. (2020). 11 Ways the CARES Act Impacts Health Care Organizations. N.p.: Mossadams. Retrieved from https://www.mossadams.com/articles/2020/04/cares-act-impacts-health-care
CARES Act, H.R 748, 116th Cong. (2020). https://www.congress.gov/bill/116th-congress/house-bill/748.
Hojnicki, K. (2022). Exploring the unintended consequences of the CARES Act. Williamsburg, VA: W&M News. Retrieved from https://news.wm.edu/2022/01/12/exploring-the-unintended-consequences-of-the-cares-act/
Saad, L. (2021, March 26). COVID-19 Aid Package Both Popular and Controversial. Gallup. Retrieved September 18, 2022, from https://news.gallup.com/poll/342041/covid-aid-package-simultaneously-popular-controversial.aspx