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The President’s Dilemma
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Last modified: 5 months ago This chapter teaches students about macroeconomic concepts and analysis, including fiscal and monetary policy, and economic indicators. 
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The President’s Dilemma
The President’s DilemmaUnit OverviewTime Required 10-12 hours of class time Project Scenario In a mixed-market economy like the United States, the federal government uses fiscal and monetary policy tools to influence the behavior of individuals, firms, and financial institutions. However, in attempting to improve the performance of the nation’s economy, the government encounters the problem of resource scarcity. Tradeoffs must be considered; some groups may be harmed in order to help another group in society. To explore these concepts and gain some understanding of macroeconomic analysis, students are presented with the following problemsolving scenario in this project:
Concepts to be Learned To successfully resolve the problem and complete the products required in this project, students need to understand and be able to apply the following economic concepts:
Placement In Curriculum The President’s Dilemma is designed to be the fifth Project Based Economics unit students complete. This unit teaches students about macroeconomic concepts and analysis, including fiscal and monetary policy, and economic indicators. Prior to undertaking this problem, students should be familiar with the fundamentals of market economics as learned in Running in Place, The Invisible Hand, Monopoly’s Might, and The Greater Good. Sequence and key content of PBE units Essential Units:
Additional Units:
NCEE Content Standards Addressed The President’s Dilemma addresses the following Voluntary National Content Standards in Economics codified by The National Council on Economic Education, in partnership with the National Association of Economic Educators and the Foundation for Teaching Economics. For more information see www.ncee.net/ea/standards.
Project Based Learning and Project Based TeachingDefinition of PBL Project Based Learning (PBL) is a teaching method in which students:
Project Based Learning shares fundamental constructivist assumptions and techniques with other approaches including: inquiry-based learning, problem-based learning, anchored instruction, authentic pedagogy, and field study. PBL is often cited as a valuable method by educators promoting differentiated instruction, multiple intelligences theory, learning styles theory, 21st century skills, and the “new 3 Rs” of rigor, relevance, and relationships. The BIE Project Based Economics units are built around a scenario that presents students with an engaging, realistic problem with more than one possible reasonable solution. In BIE materials, the term “unit” is used interchangeably with “project.” This is because in PBL, the project drives the curriculum — it provides the structure for teaching and learning. A project is not just an “applied learning activity” that follows a traditionally-taught unit of instruction. Students solve the problem through the application of content knowledge and collaborative resource-gathering, investigation, discussion and decision-making. However, students do not work completely on their own or exclusively with their peers when addressing the problem presented in the scenario. PBL is most effective when accompanied by project based teaching. Project Based Learning is NOT like “discovery learning” in its most basic form, in which students are provided with tools and activities that allow them to “discover” knowledge and skills with minimal guidance from a teacher. In PBL, the teacher has an essential role, that of a “coach” who guides students through the process of collaborative problem-solving and the creation of high-quality products and performances. And, of course, teachers still “teach” in PBL. They are an important provider of subject-area knowledge, and remain responsible for monitoring and assessing student learning, clarifying content-related concepts and misconceptions, assigning students to work groups, and managing what goes on in the classroom. However, the timing and extent of a teacher’s instructional interventions differ from those used in traditional approaches. Effective teachers in PBL wait for teachable moments when students are interested and ready to learn before intervening or providing the necessary content explanations; they present or clarify concepts once students realize they need to understand subject-area content in order to solve the problem. Project Based Learning is most effective when it is a collaborative effort between the teacher and students, with the teacher as the senior partner. Components of Project Based Economics Units Coaching students to resolve the problem posed in each PBE unit requires a teacher to weave together a number of instructional components while remaining focused on the economic concepts around which the project is organized. All PBE units include the following:
Revisit the Driving Question and know/need to know list at key points during the unit. Items should be added or moved to the “know” list as new information is learned. Some items may have been learned when a new memo or other resource is provided; others may have been taught by the teacher or researched by students. Items should be added to the “need to know” list as new developments unfold in the project scenario, and when students understand economics more deeply and their task becomes clear. Items may be crossed off the need to know list when students find out something on their own, or when the teacher provides a lesson. The lesson may be in the form of a mini-lecture, discussion, reading assignment, or other activity. For some items that are easily and quickly answered, it is OK to tell students the information right away in order to move on with the unit. For example, “When is this due?” or “Who’s in the groups?” or other questions involving the logistics of the project may be answered very soon after being listed. Some vocabulary words students encounter in a piece of text and add to the need to know list — especially if they are not economic terms — may also be defined on the spot, if necessary for understanding. NOTE: The know/need to know list does not have to be revisited every time a new step is taken — the process can start to bore students and take up too much time. We have noted certain steps where it is optional. Teachers should use their judgment about how often and how thoroughly to go through the process, based on the needs of their students.
Efficient project based teaching generally involves selecting content resources for students to use before they embark on solving the problems presented and creating products. These can include economic textbooks, specially prepared handouts, newspaper articles, videos, CDROMs and websites. Students should be encouraged to grapple on their own or in small groups with economic concepts, and find their own answers to content-related questions as much as possible. Consequently, it is generally best not to assign specific resources but rather to tell students what they can easily access to find the information they need to complete project tasks. It is then up to students and their groups to decide what content resources they are going to pursue.
In PBE, when lectures are given, they should be short (hence the term used in these materials, mini-lecture) and organized. Limit lectures to the information students need at that point in the problem-solving process. A mini-lecture should be introduced by talking about it as part of the teacher’s role as “coach” for the students’ problem-solving process. It is a good idea to refer to the “Need to Know” list and say something like, “Many of you said yesterday that you had questions about ______, so I have some information that will answer those questions.” And, as in all cases when lectures are used, teachers should use the techniques of good lecturing; engage students by speaking in an interesting style, asking questions, giving examples, using visual aides, and pausing to have students think, talk, or do some activity. In the Step by Step Teaching Guide section below in this unit, we have noted the general topic of each clarifying lesson. For each lesson, see the “Economics Review” material in Section V below, Teacher Materials. These materials are meant to be used by the teacher when putting together lessons for students, which may include the use of textbooks, other resources, and activities. The materials include a glossary of terms and information to support mini-lectures, but are not “scripts” to be read or handouts meant for students. In addition, PowerPoint slides to support mini-lectures may be found at www.bie.org, which cover the key concepts underlying each unit.
Economics Content Notes point out key concepts students should be learning, and provide guidance on how to ensure that they do. Potential Hurdles note certain points during the unit when students might become confused or sidetracked, and explain how to help them.
Project Logs provide a structured way of assessing student understanding and are included in PBE units at significant points during the project. Teachers may have students record many things in a Project Log or journal, including notes on the process of learning, comments on how well they or their groups are working, or reflections on content-related topics. In this project, the prompts we have provided for Project Log entries require students to write a short, concise answer demonstrating their understanding of specific economic concepts, which are pointed out in the Step-by-Step Teaching Guide in Section III. Teachers can develop more Project Log prompts if they wish. Project Logs provide for individual accountability for learning the material, and allow the teacher to assess the understanding of each student when students work in groups. Project Log entries must be checked soon after they are written if they are to be used effectively as a diagnostic tool. The teacher needs to find out what students do and do not know in order to plan the next day’s instruction. Apart from skimming them all, one way to do this quickly is to select a small number of representative samples from a range of students in the class. Or, students could be asked to raise their hands according to how well their entries — or their peer’s if they have swapped and read each other’s logs — matched the criteria provided. Once Project Log entries have been reviewed to assess the degree to which individual students understand the conceptual material being addressed, teachers can plan further instructional actions such as:
Oral presentations to the class or a panel are a valuable component of many PBE units. As teachers know well, you’re often not really sure if you understand something until you explain it to others. However, managing oral presentations well presents several challenges. Student groups need time to prepare and practice. The expectations for a good oral presentation should be made very clear, including presentation techniques and proper attire, posture, attitude, and group member participation. The rubrics accompanying each unit provide guidance to students on the use of content knowledge as well as oral presentation skills. To help ensure proper participation by all group members, experienced teachers use several strategies. One is to explain that everyone will be held responsible for understanding all parts of an oral presentation and the visual aides that accompany it — and the rubric and grading criteria will reflect this goal. In addition, groups could be informed that even if they have decided in advance who will say what during the formal part of a presentation, anyone may be asked a question about any part of the presentation. Or, a teacher could tell students they will be picked at random just before the presentation to deliver various parts of it, thereby putting all group members on notice that they all need to be prepared to fully participate. On the day of presentations, if the number of groups is not too large, there may be time for each group to make a presentation. However, a potential problem with this approach is that groups tend to repeat themselves, and by the time the fourth or fifth group has made its presentation, there is very little new left to say or very few new questions to ask the group. Also, students in groups presenting nearer the end may have an advantage by hearing previous presentations. This can be avoided if it is possible to send the rest of the class to the library or another room, so each group can present only to the teacher or panel — or have presenting groups go to another location. If all students need to remain together, give student audience members a task. Have them listen to other presentations and make notes of good points made and good answers to questions, as well as how they might have done it differently. Some classes may be ready to assess their peers’ performance, using a rubric or other set of criteria while they observe and listen. Maximizing the Effectiveness of Project Based Teaching
There is no always-applicable guidance for forming groups, and teachers will have to think about their students and decide who works well together. Generally, we encourage teachers to include students with different interests and abilities in the group so that a range of talents and skills can be applied to the project. And, it is generally NOT a good idea for students to choose their own groups based on friendship alone. Coaching and monitoring groups is important. Most groups will need some assistance maintaining a task focus. Groups may also need help maintaining a positive attitude or dealing with group members who are not carrying their weight. Although PBL is predicated on students taking charge of their own learning, teachers need to monitor this process continually, and pull groups into impromptu conferences when their process bogs down.
Consequently, BIE provides multiple choice tests that can be used to assess individual student understanding at the conclusion each PBE unit. Additionally or alternatively, a teacher could require students to turn in individual written assignments or take a short-answer/short-essay test. Teachers will have to work out what is most appropriate for their own grading system, but the fundamental idea holds: Make sure to assess students individually on their content knowledge, in addition to any group assessment you conduct.
All Project Based Economics units have been developed in close consultation with US high school teachers and have been tested in their classrooms and revised based on their feedback to ensure that the project, although enjoyed by most students, does not become merely a “fun activity.” The project has been created to achieve a serious instructional purpose, and deviating from the project scenario’s story line tends to focus students’ attention on irrelevant or less important learning objectives.
Teaching The President’s DilemmaSequence of the Unit Like the other BIE Project Based Economics units, students complete The President’s Dilemma by following a standard set of activities in a proscribed order. But within these activities, there will be variation in the timing and in the way students complete them. The sequence of instructional activities is described below. This sequence is logical, and is based upon extensive pilot testing in high school economics classrooms. It is also informed by research into effective instruction. Although changes may be necessary to meet time constraints, address the needs of specific student populations, or include additional instructional materials and learning opportunities, we strongly encourage teachers to adhere to the sequence of activities as closely as possible — at least during the first several times The President’s Dilemma is taught. The underlined phrases are cross-referenced and discussed in more detail in the following section, the Step-by-Step Teaching Guide. Pre-Project Planning
Launching the Project
Framing the Inquiry
Problem-Solving and Learning Activities
Presentation, Assessment and Debrief
Step-by-Step Teaching Guide Each of the above instructional activities is discussed in more depth below, with tips for successful classroom implementation. Pre-Project Planning
There are a number of issues that must be considered before embarking on a project with students. These include:
In addition to considering the above issues, be sure student handouts and clarifying lesson/minilecture materials are ready — or at least underway. Launching the Project
The memo from the President may be found in Section IV,Student Materials. Have one or more students read aloud the Entry Document while the whole class focuses on it. The memo can be projected so it can be read by the whole class. Alternatively, copies of the memo can be duplicated and passed out to students, or viewed online as an email or document posted to a website. Potential Hurdle: As this memo sets up the scenario and the problem to be solved, it is essential that the entire class be able to read and comprehend the text. If necessary, employ the same literacy-building strategies you would normally use for this kind of reading material. Synopsis of Memo: Due to a rapid rise in oil prices, the United States faces a severe economic crisis with high levels on inflation, unemployment, and negative economic growth. The President, fearing prospects for reelection, has asked a Special Task Force of the Council of Economic Advisors to recommend a policy that does not increase the national debt. The Task Force is asked to make an oral presentation with visual aides to a panel composed of representatives of various constituencies. The President also asks the Task Force, as a first step, to compare current economic indicators with statistics from the past. Economics Content Note: The memo contains a number of economic terms, such as unemployment, inflation, and economic growth. This is intentional. It is assumed that students will either not understand these terms or have misconceptions regarding their meanings. Do not, at this point, explain to students the meaning of these terms. Tell students they should put these terms on the list of what they “need to know” to resolve the problem. Figuring out the meaning of economic terms is something students should, as much as possible, do for themselves (with the teacher’s monitoring and guidance) once they begin working to solve the problem. Framing the Inquiry
Students must now assess what they already know about the problem posed in the Entry Document. This should be done as a whole class by creating a “What Do We Know?” list on chart paper, an overhead transparency, or a computer projector. Ask students to carefully review the Entry Document and offer items for the list, making sure to only record what is in the text, not what might be inferred. Students should be coached to identify all of the information that the Entry Document provides. They should conclude that this information is insufficient to solve the problem, and they need to know (learn) additional things. Although each class generally produces a unique know / need to know list, an example of the type of items that might appear on the first “know” list follows. Example of Initial Know List What do we know?
At this point, do not ask about solutions, as this might negate or offset information gathering, which is the most important part of the problem-solving process right now.
After students have discussed the memo from the President, and you are satisfied that students understand it, lead students in drafting an initial Driving Question. This is generally done as a whole-class discussion. A Driving Question is a succinct declaration of the general problem students are to solve. In PBL it takes the following form:
The initial Driving Question may be quite different from the Driving Question that will emerge as students think about and work on the problem. This is to be expected. The Driving Question generally evolves as students gain more insight and knowledge into the problem and its underlying issues. The initial Question may look something like:
At this point, it is fine to keep the Driving Question ill-defined. It is not necessary for the Driving Question to contain economic terms or, if it does, use the economic terms correctly. The Driving Question will become more refined as students learn more, and as new developments in the scenario unfold. Potential Hurdle: Students may want to write a Driving Question that includes the memo they are asked to write comparing this crisis with economic conditions in the past. It would be OK to either write a lengthier Driving Question to include this, or write a “short-term” Question after writing the “long-term” one above.
The next step in the problem-solving process is to coach students to identify information they need to know in order to answer the Driving Question. Again, guiding students to pay close attention to all parts of the memo, create a “What Do We Need to Know?” list. If students are missing a key piece of information about the scenario, the content, or their task, ask questions to elicit items for the list. This is critical because everything students are taught in the unit must spring from this list. At this point in the problem-solving process, students will probably list things that they actually do not need to know. Allow students to do so. The class will return to the know / need to know list again later, having learned more about what they need to know to solve the problem, and should recognize irrelevant concerns at that time. A core part of the process of Project Based Learning is to distinguish what information is and is not necessary to successfully answer the Driving Question. As much as possible, encourage students to identify irrelevant information on their own. Although each class generally produces a unique know / need to know list, an example of the type of items that might appear on the list follows. Example of Initial Need to Know List What do we need to know?
Problem-Solving and Learning Activities
For information to include in this lesson see “Economics Review” in Section V, Teacher Materials. Note that this lesson will help answer students’ questions on the “Need to Know” list about inflation, unemployment, economic growth, leading economic indicators, and so on. This lesson can be provided to students using a combination of mini-lectures, activities, and reading selections from a textbook and other print and online resources, some of which may be assigned as homework. Economics Content Note: This lesson should emphasize the how statistics can be used to gauge the health of an economy. Students should recognize that economic indicators are used to monitor how well an economy is achieving its economic goals (economic growth, high employment, and low inflation) and that different indicators play different roles in measuring the economy. Leading indicators predict where the economy might be going. Coincident indicators show where the economy currently stands and lagging indicators are slow to respond to economic changes.
The table “National Statistics for Selected Years” may be found in Section IV, Student Materials. This table may be used in conjunction with the clarifying lesson above, or may be explained just afterward. This table contains key economic indicators for various years: Nominal and Real GDP, Percent change in GDP, Discount Rate, Consumer Price Index, Rate of Inflation, Unemployment Rate, and Public Debt. Remind students that their first task is to write a memo comparing current economic data with the past. Students should use the information in this table to place the current economic crisis within an historical context.
Now form students into small groups of four to six — these will be the Special Task Force teams for the rest of the project. See notes on forming groups in Section II above, under “Managing Small Group Work.” Ask students to work in their groups to analyze and discuss the table in comparison with what they know about the current crisis. Circulate among groups to answer questions and to keep students focused on the columns showing inflation rates, unemployment rates, and changes in economic growth. Allow students enough time to write their memo in class so it is a group effort. Economics Content Note: When you collect the memos, look for evidence that students understand that the current crisis is indeed serious, because:
You may wrap up this step with a whole-class discussion if you wish.
The letter from Maria Bautista may be found in Section IV, Student Materials. Read this letter aloud as a class, then discuss what aspect of the economic crisis the writer is focused on and why — and what she wants the President to do. Synopsis of Letter from Maria Bautista: Since she represents a worker’s political action committee, Ms. Bautista focuses on unemployment. She highlights the growing sense of despair among workers around the country who fear they soon will lose their jobs and won’t find reemployment opportunities. She warns that the recently unemployed and angry Joe Brezinski will represent her organization at the presentation by the President’s economic task force. Economics Content Note: Students should be able to see that demand-side policies can be targeted in many different ways. While they often focus policies on working middle-class individuals, (e.g. “let’s help by giving them a tax break”), they should be coached see that, while middle class people with jobs appreciate these policies, policies should be designed for the middle class people without jobs — i.e., the demand-side policies. As a teacher, your major focus is to show students the myriad of policies that can be enacted, with each policy focusing benefits on a different group of individuals. Optional: You and / or your students may wish to add items from the letter to the know/need to know list at this point.
For information to include in this lesson see “Economics Review” in Section V, Teacher Materials. Note to students that this lesson will help their questions on the “Need to Know” list about what the government can do to help ease the economic crisis. This lesson can be provided to students using a combination of mini-lectures, activities, and reading selections from a textbook and other print and online resources, some of which may be assigned as homework. Economics Content Note: This lesson is designed to provide students with a comprehensive overview of fiscal policy tools, including criticisms of them. Students should understand how government spending or taxation can be used to expand the economy or to contract it and why critics believe it to be totally ineffective. Students should also understand how fiscal policy can be targeted toward consumers (the demand side) or firms (the supply side). The lesson should also introduce students to the multiplier effect.
How can fiscal policy be used to help workers like Joe Brezinski? Project Log entries do not have to be long, but they do need to be completed for Project Based Learning to be most effective. They may be assigned either as in-class tasks or as homework.
For tips on reviewing Project Logs, see “Formative Assessments” in Section II, Problem Based Learning and Problem Based Teaching. Economics Content Note: Be sure students show they understand how expansionary fiscal policy might be used to pull the economy out of its current crisis. Make sure students don’t suggest policies that might increase the debt (e.g., increase spending and reduce taxes), since the memo from the president explicitly states that debt cannot be increased. Students might quickly realize that most policies they develop will increase debt. They need to consider whether or not they will try to convince the President to increase the debt. If you notice that students do not understand these concepts, you may need to further clarify them by talking with the whole class, individuals, or small groups.
The letter from Angela Soracco may be found in Section IV, Student Materials. Read this letter aloud as a class and then discuss what aspect of the economic crisis the writer is focused on and why — and what she wants the President to do. Synopsis of Letter from Angela Soracco: Since Ms. Soracco represents a retired persons association, she is most concerned about rising prices. She notes that most retired Americans have fixed incomes, so inflation makes basic necessities less affordable and erodes the value of assets such as pensions and homes. And since they rely on Social Security benefits, older people would be harmed by any reductions in these transfer payments. Economics Content Note: Some students may correctly point out that Social Security benefits are indexed to inflation and, as a result, rising prices should not be a concern for the elderly. Coach students to see that Social Security is only part of retired people’s income. They also rely on pensions, which are usually fixed in their dollar amount, and on assets that have been accumulated throughout their work life (e.g. their house). Students should be able to distinguish between monetary policies to curb inflation and fiscal policies to stimulate spending. Optional: You and / or your students may wish to add items from the letter to the know / need to know list at this point.
For information to include in this lesson see “Economics Review” in Section V, Teacher Materials. Note to students that this lesson will help answer their questions on the “Need to Know” list about what the government can do to help ease the economic crisis. This lesson can be provided to students using a combination of mini-lectures, activities, and reading selections from a textbook and other print and online resources, some of which may be assigned as homework. Economics Content Note: This lesson is designed to provide students with a comprehensive overview of monetary policy tools. Students should understand the tools the Federal Reserve can use to expand the economy or to contract it. The lesson should also introduce students to the main role of monetary policy: to stabilize the money supply.
How can monetary policy be used to help people represented by the Silver Panthers of America? Project Log entries do not have to be long, but they do need to be completed for Project Based Learning to be most effective. They may be assigned either as in-class tasks or as homework.
For tips on reviewing Project Logs, see “Formative Assessments” in Section II, Problem Based Learning and Problem Based Teaching. Economics Content Note: Be sure students show they understand how monetary policy might be used to curb inflation or to stimulate the economy. If students forget to distinguish between cost-push and demand-pull inflation when discussing monetary policy, coach them to remember the cause of price increases in the project scenario — rising oil costs. Remind them that monetary policies that curb demand-pull inflation are not necessarily effective when inflation is caused by cost-push factors. If you notice that students do not understand these concepts, you may need to further clarify them by talking with the whole class, individuals, or small groups.
The letter from William M. Jorgenson may be found in Section IV, Student Materials. Read this letter aloud as a class, then discuss what aspect of the economic crisis the CEO is focused on and why — and what he wants the President to do. Synopsis of Letter from William M. Jorgenson: CEO Jorgenson advocates for a supply-side solution to the crisis. He reminds the President that rising costs of production have led to higher prices for automobiles, fewer sales and lower profit levels. He warns that the continued support of corporate leaders depends on the President finding solutions that meet the needs of business. Economics Content Note: Coach students to focus on the challenges of business (e.g. they want cheap labor and capital) and the demand for their product. The latter, which students have more difficulty seeing, is important to acknowledge because business will only operate with a demand for their product. Hence, unemployed workers could result in both cheaper labor for production and a lower demand for cars because of consumers’ inability to pay for the goods. Students should weigh the benefits of each of these potential tradeoffs and think seriously about what type of supply-side policies would most benefit firms given the scenario of the project. Optional: You and / or your students may wish to add items from the letter to the know/need to know list at this point.
How might corporate leaders, unemployed workers, and retired people respond differently to the government’s use of demand-side policies? How might each group respond differently to supply-side policies? Project Log entries do not have to be long, but they do need to be completed for Project Based Learning to be most effective. They may be assigned either as in-class tasks or as homework.
For tips on reviewing Project Logs, see “Formative Assessments” in Section II, Project Based Learning and Project Based Teaching. Economics Content Note: Students should see that, for example, the Silver Panthers of America and unemployed workers might want demand-side policies such as transfer payments but the CEO will argue that transfer payments create work (and / or investment) disincentives. Unemployed workers want demand-side policies that stimulate employment, perhaps through government jobs, but the CEO wants the lower wages that result from high unemployment and believes that government employment (and spending) hurts business by competing for the best workers (or monies). Taken as a group, all letters illustrate the tradeoffs and opportunity costs involved in developing policies that might help to solve the economic crisis. If you notice that students do not understand these concepts, you may need to further clarify them by talking with the whole class, individuals, or small groups.
Students should now be given some time — approximately one whole class period — to begin to develop their policy recommendations. They should work in the same small groups that wrote the memo earlier comparing the current crisis to economic indicators in the past. Since this is the first lengthy period of time they have been given in class to discuss possible solutions to the problem, coach students to hold off on doing any planning for their presentation and visuals yet. Suggest they focus only on fiscal and monetary policy options at this point. Economics Content Note: Be sure to remind students, if necessary, that the current crisis is caused by the reduction in oil supply, which increased the price of oil. The increased price of `oil not only inflates prices, it also creates unemployment as layoffs occur. The increased prices reduce the consumer’s ability to purchase goods and services. A failure to see the cost-push cause of the crisis will divert students from appropriate economic policy solutions. Also, students must distinguish between the demand-side and supply-side emphasis for policy solutions. They should learn that within each emphasis, there is the potential to use monetary and fiscal policy tools.
The memo from the Chief of Staff may be found in Section IV, Student Materials. Read this final memo aloud as a whole class. Make sure students clearly understand what is expected of them in terms of the format and content of the presentation.
The additional information gained from the memo from the Chief of Staff does not have to be added to the final know list, since this would basically be a “copying” task. However, students may wish to add more items to the know list that they have thought about in terms of the content or the scenario, or move items over from the need to know list, so allow them a final opportunity to do so. Revisit the need to know list for the last time and make sure students are ready to solve the problem by answering any remaining questions or directing students toward the necessary resources
Students should write the final version of their Driving Question at this point. The final Driving Question should resemble:
A rubric for the oral presentation and written summary may be found in “Assessment Tools” in Section V, Teacher Materials. Give a copy of the rubric to each student, or display it on an overhead or computer projector so every student can read it. Discuss the rubric with students to be sure they understand that they will be assessed primarily on their knowledge of economics. Their oral presentation and writing skills, while important, are given less weight on the rubric. If you are altering the rubric’s point scheme to conform to your own grading system, be sure to maintain the emphasis on knowledge of economics. Presentation, Assessment, and Debrief
Now it is time for students, in their groups, to synthesize all they have learned and develop their ideas for how the President could address the economic crisis. Allow a substantial amount of time for this step — two or three class periods may be required — and some homework also may be needed. Listen, observe, and actively coach students as you circulate among groups in the classroom. Remind students to use the rubric to guide their work Economics Content Note: Students’ policies must be grounded in the parameters of the project scenario: cost-push inflation with rapidly rising oil prices; high levels of both unemployment and inflation, and slowing economic growth. Furthermore, because the solutions the students propose cannot increase national debt, they must discuss how they will increase government spending or reduce taxes, or subsidize research without incurring more debt. Visuals may be produced on chart/poster paper, overhead transparencies, or as PowerPoint slides. Students may choose to create any kind of graphs, charts, lists, or other displays that they think will add to their oral presentation. A draft of the written summary and the presentation visuals should be checked by the teacher before the presentation, to comment on their quality and correct errors. If time does not allow for the summaries to be reviewed outside of class time, be sure to spend time with each group while they work during the days before the presentation. Potential Hurdle: Students may want to suggest that the U.S. government invest in a massive research and development effort to produce alternative fuels and energy sources. This would be an acceptable use of fiscal policy, but be sure this does not become their primary solution to the problem, which is solving the current economic crisis. Other fiscal and monetary policy tools should be emphasized as more immediately effective steps.
For more guidance on managing the presentations, see “Presentation and Critique of Answers to Driving Question” in Section II above. Make sure students have their visual aides ready and remind them about the strict Each group makes its presentation to a panel composed of the President (usually the teacher) and the representatives from the Silver Panthers, the Campaign for Job Security, and the Henry J. Car Corporation. The President acts as moderator and has the responsibility for bringing the overall economic emphasis to the discussion, including the issue of not raising the national debt. The President also keeps an eye on overall costs and benefits, including the political effects of the task force’s recommendations on various constituencies. If possible, invite guests from outside the classroom to play the roles of the constituency representatives, since this motivates students to do a good job. If this is not possible, you as the teacher will have to wear several hats and switch roles for various questions. After the presentation, allow from three to five additional minutes for panel members to question students about their policies. Panel Member Questions may be found in “Assessment Tools” in Section V, Teacher Materials. Potential Hurdle: These presentations require careful management. Depending on the size of the class and number of groups, a second day for presentations may be necessary. In this PBE unit in particular, it is best if students do not see each other’s presentations before they make theirs, or unfair advantage and plagiarism could result. Panel members should be limited to three questions each to allow enough time for as many presentations as possible in one class period. To keep the panel members from straying from economic concepts, scripts for their character are provided in Section V, Teacher Materials. The President / teacher’s questions should help students see any potential contradictions in their policy.
The rubric for the presentations and written summaries may be found in “Assessment Tools” in Section V, Teacher Materials. As you hear and see the students’ presentations and read their written summaries, use the rubric to help you note any areas of weakness that reveal incomplete or incorrect understanding of key economic concepts. Clarify these during the debrief to follow.
It is critical that the debrief phase of the project not be ignored. This is the time when students, as a whole class, reflect on and receive feedback on both the economic content of the project and the process of solving the problem presented in the scenario. The debrief is in two stages; the first focuses on economics content, and the second focuses on the process of learning in PBL. Begin the content-focused part of the debrief by discussing how the project helped students better understand economics. The discussion could be guided by questions such as:
The economics content-focused debrief is a vital opportunity for clarifying any remaining conceptual misunderstandings evident in student work, or correcting inaccurate statements made during presentations. Economics Content Note: It is important for students to see that any policy they develop will have underlying tradeoffs and opportunity costs. That is, policies designed to help one group will often hurt another group. Because politicians often disguise these opportunity costs in their speeches, students are often reluctant to propose or acknowledge that tradeoffs exist. The debriefing should help students see that, because resources are scarce, helping one group often means hurting another. Care should also be taken to ensure that students understand the differing goals of each type of policy: monetary and fiscal, demand-side and supply-side. Economists who argue for supply-side policies place relatively more importance on business activity while economists who argue for demand-side policies place more emphasis on demand in households. You could go back to the circular flow diagram presented in the debrief portion of the Running in Place PBE unit and show students how businesses and households are part of the same economy, but demand-side and supply-side policies are directed at different entities.
Students should have a chance to discuss the process of learning in PBL, and to reflect on their use of 21st century skills such as critical thinking, collaboration, and presentation. This part of the debrief could be done with a series of questions, for example:
Finally, ask students for feedback on how the project was structured, with questions such as:
The multiple-choice test for this unit may be found in “Assessment Tools” in Section V, Teacher Materials.
Teachers inevitably recognize how to make The President’s Dilemma more effective after they have taught it. We encourage you to note these thoughts quickly, so they can review your ideas for improvement the next time you teach the unit. Teaching Tips Before a Project Based Economics unit is published, it is taught numerous times by experienced high school Economics teachers. We include their advice below.
Student MaterialsTO: Special Task Force of the Council of Economic Advisors FROM: President of the United States RE: Policy Recommendations for Current Economic Crisis As you know, the recent oil supply shocks and the rapid rise in oil prices has produced an economic crisis. As a result, we are facing:
I am hearing a great deal of criticism from all sides about how we’re not dealing strongly enough with this—my approval ratings have plummeted. We need to develop an economic policy that will ease the crisis. I have therefore convened this special task force of the Council of Economic Advisors. Of course, any policy we develop cannot increase our already-too-high national debt. Once you have developed your policy, prepare a presentation, using visuals, that explains and justifies your policy. A written summary of your presentation must be on my desk before you make it. You will deliver the presentation to me and a panel of representatives of different constituencies. We need to get feedback on whether or not voters will find the policy acceptable, a critical necessity if I am to have a hope of being reelected this year and you have a hope of keeping your politically-appointed jobs. The panel will ask you questions and expect you to defend your plan. If this group accepts your recommendations, I will use your ideas as the basis for a speech to the nation the following week. Some people are saying this could be the worst economic crisis the nation has ever confronted. Before you get started on your policy recommendation, send me a memo ASAP with your analysis of how our current unemployment, inflation, and economic growth compare to leading economic indicators in the past.
CAMPAIGN FOR JOB SECURITY Keep America Employed! TO: The President of the United States FROM: Maria Bautista, Policy Analyst, Campaign for Job Security RE: Unemployment The Campaign for Job Security (CJS), as you know, is a fast-growing worker’s political action committee. Four months ago CJS asked me to conduct a series of public forums and private meetings to determine the mood of workers across the nation, in light of the rising levels of unemployment among the middle class. After my conversations with citizens throughout our country, I think you should be most concerned about the growing sense of economic insecurity and despair among middle class Americans. Unemployment is their major worry—either because they’ve lost their jobs or fear it’s about to happen. Currently, Thank you for inviting CJS representative Joe Brezinski to hear the presentation by your Task Force and voice the concerns of our organization. You should know that Joe has recently lost his job and is worried about losing his home. Be prepared, he is angry. TO: Office of the President The White House, Washington, D.C. FROM: Angela Soracco President, Silver Panthers of America RE: Eroding Value of Assets We are quite concerned about rapidly increasing prices and their potential impact on the relatively fixed incomes of older Americans. Inflation is eroding the value of our assets such as our pensions and our homes. Our dollars can no longer stretch far enough to afford the basic necessities of living: rent, food, and health care. Increasingly, we are reliant upon our Social Security and any reduction in these payments will further limit our ability to buy basic necessities. Most of us have worked hard all of our lives to create a nest egg so that we could enjoy the fruits of our labor in our old age. Perhaps it would be beneficial for you to speak to the chair of the Federal Reserve and remind him that rising prices are the most critical issue facing the nation during these difficult economic times. After all, what kind of nation would neglect those who have dedicated their working lives to their country? Memorandum TO: President of the United States FROM: William M. Jorgenson, CEO, Henry J. Car Corporation RE: Current Economic Crisis As per our discussion at the Corporate Leaders Forum held at Camp David last week, I want to remind you of my concerns regarding the current economic crisis and to reiterate how I think this crisis should be handled. As you know, the rising cost of production associated with the increased price of oil has made it necessary for us to increase the prices of our automobiles. As a result, fewer cars are being sold and our profit has fallen. Clearly, businesses cannot survive in such an environment. The success of big business is reliant on a supply-side strategy to solve the crisis. I am not sure that you agree with this. However, the continued support of your administration by the Corporate Leaders Forum is dependent upon your following this strategy. I appreciate your invitation to join the panel of constituent groups who will hear your economic task force present their recommendations. Remember, the business of America is business. OFFICE OF THE CHIEF OF STAFF TO: Special Task Force of the Council of Economic Advisors FROM: Jesse Sloan, Chief of Staff RE: Details on your presentation on the economic crisis The President asked me to send you the following parameters for your presentation:
Teacher MaterialsEconomics Review Monetary Policy The Federal Reserve (Fed) regulates and manages the money supply in accordance with the levels of output (and employment) and prices. It has three tools at its disposal to alter the money supply.
Easy (Expansionary) Monetary Policy Policies to increase the money supply are used when growth in the economy is “too slow.” That is, the economy is faced with unemployment and deflation. To increase the money supply the Fed would:
An expansionary monetary policy is effective when the economy is sluggish (falling GDP). It stimulates investment, which ultimately expands firm production and employment. If it is invoked when the economy is overheated (rapidly expanding GDP and inflation) then an expansionary monetary policy further fuels inflation. If prices are rising due to cost-push factors and the economy is sluggish, as in our problem, then increasing money supply to expand the economy may have little impact on price levels. Tight (Contractionary) Monetary Policy Policies to decrease the money supply are used when growth in the economy is “too fast.” That is, the economy is faced with cost-push inflation created by labor shortages. To decrease the money supply the Fed would:
A contractionary monetary policy is effective when the economy is overheated (rapidly increasing GDP and inflation). It is used to decrease investment and slow economic expansion. If invoked when the economy is sluggish (declining GDP and high levels of unemployment), then a contractionary monetary policy further deepens the recession. If prices are rising because of cost-push factors—and not because the economy is overheating—tight monetary policies may have little impact on slowing inflation. Thus, contracting the money supply as a solution for our problem would, in theory, decrease GDP, increase unemployment, and have little impact on prices. Fiscal Policy Advocates of fiscal policy believe that the government’s decisions about spending and taxing can influence the equilibrium of the nation’s GDP. More specifically, a fundamental function of the government’s spending and taxing policy is to stabilize the economy. This stabilization is achieved in part through the manipulation of the public budget — government spending and tax collections — for the expressed purpose of increasing output and employment or reducing the rate of inflation. In addition to its role in stabilizing the economy, the federal government is also concerned with the provision of public goods and services and the redistribution of income. In this regard, the specific types of spending and taxing policies used for stabilization are important. For example, the government could engage in an expansionary policy by increasing the dollars going toward education, by serving as employer of last resort for low-skilled, unemployed workers, or by decreasing income taxes for the wealthy. While all of these scenarios might have the same expansionary impact on the economy as a whole, they would have very different distributional impacts. One policy helps the middle class (the primary recipients of public education), one helps the poor (low-skilled and unemployed), and one helps the wealthy (tax breaks). Fiscal policy can be targeted toward either the supply or demand-side of the economy. Supply-side policies include all policies targeted toward production in the business sector (e.g. changing incentives for investment). Demand-side policies include all policies targeted toward spending by consumers (e.g. altering employment opportunities or taxes on consumption). Easy (Expansionary) Fiscal Policy Increasing government spending or decreasing taxes is used when growth in the economy is “too slow.” That is, the economy is faced with a recession, high levels of unemployment, and slow growth in GDP. Expansionary fiscal policy includes:
If the budget is balanced, an expansionary fiscal policy will increase the deficit as government spending is increased. Critics of fiscal policy measures argue that this expansion by the government “crowds out” expansion of private firms by competing for investment funds used to finance spending. Assuming that crowding out effects are minimal, expansionary fiscal policy is effective when the economy needs stimulation. It stimulates spending (of consumers or firms), which in turn stimulates production and reduces unemployment. If it is undertaken when (demand-pull) inflationary pressures are present or when the economy is at full employment, it will overheat the economy and create (increased rates of) inflation. If prices are rising because of (non-labor) cost-push factors and the economy is sluggish (as in our problem), expansionary fiscal policies can expand the economy with little impact on price levels. Tight (Contractionary) Fiscal Policy Decreasing government spending or increasing taxes is used when growth in the economy is overheated. That is, contractionary policies are most effective when the economy faces excess demand for workers (by firms) or for goods (by consumers). These pressures underlie inflationary pressures and GDP growth that is “too rapid.” Contractionary fiscal policy includes:
If the budget is balanced at the outset, a contractionary fiscal policy would move the government toward a budget surplus. This surplus slows economic growth and production. Contractionary fiscal policy is effective when the economy contains (demandside) inflationary pressures. By decreasing spending (of consumers or firms), production is slowed and the demand for workers decreases. If it is undertaken when the economy is in a recession, it will further reduce economic growth and exacerbate unemployment. If prices are rising because of (non-labor) cost-push factors and the economy is sluggish (as in our problem), contractionary fiscal policies will increase sluggishness of the economy and will have little impact on price levels. Concept Definitions The curriculum was designed to teach the following concepts:
Assessment Tools Questions from Panel Members Joe Brezinski — The average middle-class American who has been recently become unemployed. Background: In contrast to monetarists and supply-siders who want to stimulate economic growth by helping business, Joe focuses on policies that have a direct impact on employment. Thus, Joe advocates policies such as unemployment insurance, government created training programs and employment opportunities, and business incentives for firms to hire American workers. Joe believes that the wealth of corporations does not necessarily filter down to the middle class but merely increases the wealth of those who are already wealthy. Points to be made:
Angela Soracco — The Silver Panthers of America President who wants to maintain the purchasing power of elderly people’s assets. Background: Living on a fixed income from pension plans and assets (e.g. equity in a house), the people represented by the Silver Panthers live in fear of high rates of inflation, which decreases their spending power. Because the income from pensions (for example) does not increase as rapidly as prices, their monthly income does not go as far when prices are rapidly rising. As the value of assets erodes, the equity in their house is not enough for them to sell their home and buy/rent another house as the price of new housing escalates with increased prices. Finally, most retired people rely on Social Security benefits, which are indexed to inflation, as a primary source of steady income and lobby heavily for the government to maintain these benefits. Points to be made:
William M. Jorgenson—CEO of Henry J. Car Corporation—who wants to stimulate economic growth by investing in business. Background: As a representative of corporate America, Mr. Jorgenson wants economic growth stimulated through the growth of business. This means that, in response to Keynesians who advocate policies that increase aggregate demand through increasing the spending capabilities of Americans, he believes that “what’s good for Henry J. Car is good for the USA”. By investing in business, the government is ensuring long-run economic growth. This growth will “trickle down” to the average worker because, as business expands, employment will increase and, as business invests, wages will increase because workers will become more productive. Points to be made:
Rubrics We have provided a rubric for each major product or performance required in this unit. All rubrics may be used as written, or adapted by the teacher to fit particular needs. Rubrics serve two major purposes. First, they provide guidance to students, describing the characteristics of good quality work—and because of this rubrics should be shared with students while they are preparing how to demonstrate what they have learned. Second, rubrics provide teachers and others with a framework for assessment and feedback. We have divided our rubrics into three levels of quality. If teachers wish to express these levels on a numeric point scale, we suggest that “Exceeds Standards” equals a 4 or 5, “Meets Standards” equals a 3, and “Does Not Meet Standards” equals a 1 or 2. We intentionally did not include a scoring system based on percentages or letter grades, since evaluation and reporting methods vary greatly among teachers. However, we have suggested what we believe to be the proper weight given to each category, with the emphasis on the application of content knowledge. The rubrics for each unit do not include extensive detail about the qualities of a good oral presentation, or of good writing and other products such as electronic media. A general rubric for any oral presentation to a panel may be found at www.bie.org. Rubrics for writing and other media products may be found in various print resources and websites, or developed by teachers, schools, and districts. The President’s Dilemma: Rubric for Group Oral Presentation on Economic Policy
Test for The President’s Dilemma Name______________________________________________ PLEASE BUBBLE IN YOUR ANSWERS COMPLETELY—LIKE THIS "Bold"
Test for The President’s Dilemma Teacher’s Answer Key
About the Author: The Buck Institute for EducationThe Buck Institute for Education (BIE) is dedicated to improving 21st century teaching and learning by creating and disseminating products, practices, and knowledge for effective Project Based Learning. Founded in 1987, BIE is a not-for-profit 501(c)3 organization that receives operational funding from the Leonard and Beryl Buck Trust, and funding from other education organizations, foundations, schools and school districts, state educational agencies and national governments for product development, training, and research. BIE is the author and publisher of a number of project-based instructional materials including the well-regarded Project Based Learning Handbook: A Guide to Standards-Focused Project Based Learning for Middle and High School Teachers used by over 30,000 educators across the United States and in over 30 other countries. The BIE PBL Handbook has been translated into Portuguese, Korean, and traditional and modern Chinese, and is available for purchase from publishers in the United States, Brazil, Taiwan, China and Korea. A shorter version has been translated into Arabic. In addition, BIE is the author and publisher of a popular set of curriculum units for U.S. high school and introductory college courses, Project Based Economics and Project Based Government. BIE is now developing a series of PBL Toolkits that will focus on specific topics in Project Based Learning. This series includes the PBL Starter Kit, a guide for teachers when planning and implementing their first project. Other Toolkit volumes focus on PBL in various subject areas, building academic skills in PBL, creating complex multi-disciplinary projects, extending PBL with technology, using PBL to develop 21st century skills, assessment in PBL, and PBL for school administrators. BIE led the creation of PBL-Online.org, a multi-media website for preservice and practicing teachers that provides guidance for conceiving, planning, managing, assessing, and improving standards-focused Project Based Learning. The PBL-Online site has been translated into Spanish (sp.PBL-online.org) and Mandarin (cn.PBL-online.org). BIE has conducted highly-rated Project Based Learning professional development workshops for thousands of secondary school teachers and other educators since 1999. In addition to working with teachers in the United States, BIE has conducted PBL professional development presentations and workshops for teachers and Ministry of Education staff in China, Malaysia, Singapore, Jordan, Mexico, Peru and New Brunswick, Canada. A number of charter school management organizations, school reform models, state and district restructuring efforts have relied on BIE professional development and the BIE PBL Handbook to help them achieve their vision. These include Envision Schools, the New Technology Foundation, High Tech High Schools, the Coalition of Essential Schools, and the West Virginia Department of Education. For further information, please visit www.bie.org and contact us at: info@bie.org. John R. Mergendoller, Ph.D. Executive Director Copyright © 2009 by the Buck Institute for Education, 18 Commercial Blvd., Novato, CA 94949 All rights reserved. For permission to reproduce any part of this publication, please contact BIE, (415) 883-0122. Graphic design: Pam Scrutton, San Francisco, CA |
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