"The President's Council of Economic
Advisers"Introduction
Students have already learned that economists and politicians
try to work together closely. The President of the United
States has a Council of Economic Advisers, a three-member
group that reports on economic developments and proposes strategies.
The economists are the advisers, while the politicians direct
or implement the policies. In this activity, students will
learn more about the Council of Economic Advisers and the
role it plays in the United States economy. Lesson Description
Students will use information from the Council of Economic
Advisers Web site to find out more about the Council and the
role that it plays in the economy. Previous Knowledge Expected
Students should be familiar with the following terms:
fiscal policy: use of government spending and revenue
collection measures to influence the economy
monetary policy: actions by the Federal Reserve System
to expand or contract the money supply in order to affect
the cost and availability of credit Applied Content Standards (from
the Council for Economic Education)
Standard 16: There is an economic role for government
to play in a market economy whenever the benefits of a government
policy outweigh its cost. Governments often provide for national
defense, address environmental concerns, define and protect
property rights, and attempt to make markets more competitive.
Most government policies also redistribute income.
Standard 20: Federal government budgetary policy and
the Federal Reserve System's monetary policy influence the
overall levels of employment, output, and prices. Instructional Objectives
- Students will restate the duties of the Council of Economic
Advisers.
- Students will describe the structure and functions of the
Council of Economic Advisers.
Student Web Activity Answers
- The Council performs the following duties: assists and
advises the president in preparing the Economic Report of
the President; gathers information concerning economic developments
and trends; evaluates programs and activities of the Federal
Government; recommends economic policies to the president;
and furnishes studies and reports requested by the president.
- Student answers may vary. The Council is composed of a
chairperson and two members. These members direct research
activities, formulate economic advice, and establish recommendations
for the president. Ten economists (usually university and
college faculty) who are called senior staff economists assist
these three people. Junior staff economists who are usually
graduate students aid these economists.
- Answers will vary. The chairperson gives advice directly
to the president and senior members of the administration.
Council members often meet without the president to discuss
issues. The methods for communication with the president vary
according to the style and interests of the president.
- The president has ultimate responsibility for economic
matters, whereas in some countries the responsibilities lie
with the minister of finance. Also, the use of senior staff
economists from universities represents an up-to-date view
on academic thinking related to the economy.
Extending the Lesson
Encourage students to research further information about the
impact of the Council of Economic Advisers by reading the
Economic Report of the President. This report can be downloaded
and printed. It is also available in many libraries.
Encourage students to learn more about the role of the Council
of Economic Advisers. Divide students into advisor teams and
have them make recommendations to the "president" on specific
economic issues/policies.
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