Natalie examined a pie chart illustrating government bond purchases by both foreign and domestic sources ,and we reviewed how the deficit has swelled during times that taxes are decreased. On the whiteboard, I charted two scenarios : one where taxes are at current levels and one hypothetical scenario where taxes are lowered. We then examined the theory of "trickle down " economics ,specifically whether decreased taxes can offset deficits created by the tax cut. Natalie then completed reading the text chapter on fiscal policy and completed the study guide on the use of fiscal policy in the 1930s to address the Great Depression and the impact of automatic stabilizers such as the progressive tax and unemployment insurance. We discussed how these stabilizers function. For homework, Natalie is to bring in at least the first two paragraphs of her long essay on the history of money and the abandonment of the gold standard. We will begin reading Ayn Rand's novel, "Anthem" tomorrow.