2006 Student Congress on Economic Issues

Minneapolis Public Schools—Learning Center for Economics
Federal Reserve Bank of Minneapolis
University of Minnesota Department of Applied Economics
Minnesota Council on Economic Education

January 12, 2006
at the
St. Paul Campus Student Center
University of Minnesota

Participating High Schools

Edison, Henry, North, Roosevelt, South, Southwest and Washburn

2006 Results

(winning team from each topic):

Topic One
Team Two: Southwest/Roosevelt/Edison

Topic Two
Team Two: North/Roosevelt/Edison

Topic Three
Team Three: North/South/Edison

2006 Economic Congress Questions

Topic One

What should Jamal do? Jamal has decided to go to a four-year college after high school. Unfortunately, the school he wants to attend is expensive. After scholarships, grant money, help from his parents and money he has saved, Jamal still will need $4,000 per year to finance his education. The best thing for Jamal to do is:

TEAM ONE: Go to school by taking out a loan. The $16,000 he will need can be paid back after he graduates. The interest rate is 5.9% and he will have 10 years to repay. His monthly payment will be $177.00. South/Henry

TEAM TWO: Work for two years at a full-time job. He can save $8,000.00 per year living at home with his parents and then he could attend college without taking out a loan. Southwest/Roosevelt/Edison

TEAM THREE: Work part-time while going to school part-time. Jamal figures he could graduate in seven years by using this method.

Note: Be sure to think about opportunity costs and the time value of money as it applies to your position or against another position.

Topic Two

What changes, if any, should government make regarding its role in the health care system?

TEAM ONE: The United States should adopt a universal health care system similar to European countries. More than 43 million citizens in the United States do not have health insurance. Therefore, many don’t access preventative medicine and cost a great deal to society when their health conditions become severe. Furthermore, the burden for providing health insurance currently falls on the shoulders of businesses. A government run universal system would free businesses from this financial burden. Southwest/Henry

TEAM TWO: The federal government should reduce its direct involvement in health care and put more decision making in the hands of citizens, particularly by promoting Health Care Spending Accounts. By providing tax incentives for people to save money for health expenses, participants will likely shop for health care smarter since they will be spending their own money. Participants who spend their money on preventative care will save money in the long run.

TEAM THREE: The main problem in the health care system is accelerating health care costs, particularly prescription drugs. Government should adopt a plan to allow the importation of drugs from other countries to reduce the cost of prescription drugs in the United States. Furthermore, the federal government could purchase drugs in bulk directly from pharmaceutical companies, giving government, and therefore citizens, more bargaining power. Each year pharmaceutical companies spend millions of dollars on marketing drugs, and are some of the most profitable companies in the nation. South/Washburn

Topic Three

In recent years many people have raised concerns over U.S. industries outsourcing jobs to other countries. Corporations cite the need to remain efficient and competitive in a continually growing global economy. However, U.S. workers with relatively high-paying jobs are often put out of work as their jobs go overseas to people who are paid less and work in conditions that are often far from U.S. labor standards. What role should government play in the outsourcing of jobs overseas.

TEAM ONE: Allow outsourcing to continue, but create an education program and job placement system for citizens whose jobs have been displaced due to outsourcing. (Retrain workers for a new or similar trade.) Roosevelt/Henry

TEAM TWO: To curb outsourcing, government should create a tax penalty against outsourcing U.S. Jobs. Corporations who wish to outsource jobs will pay higher taxes for every worker that is outsourced overseas. Southwest/Washburn

TEAM THREE: Outsourcing is a form of international trade and shouldn’t be regulated by government. As U.S. companies improve profitability from outsourcing, they will likely create other jobs in the United States. North/South/Edison

Note: Be sure to think about the opportunity costs that apply as you argue for your position or against another position.

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