American Recovery & Invest Act
The American Recovery and Reinvestment Act of 2009 was passed at a time when the United States faced economic upheaval within the real estate, job and credit markets. The projects undertaken by this piece of legislation provide a starting point for rebuilding economic stability within the country and may hold the potential for increasing stability and growth in future decades.
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Function
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In the fall of 2008, the U.S. stock market experienced pivotal changes marked by the financial collapse of Lehman Brothers and Merrill Lynch. Problems in the real estate market also surfaced during this period as the bottom began to fall out of the high-interest home mortgages market. These events coupled with rising unemployment rates threatened to collapse the American economy much like what happened during the Great Depression of 1929. According to Recovery.gov, the American Recovery and Reinvestment Act was developed to repair the damage done to the U.S. economic market as well as improve upon certain long-standing problems within the country's education and healthcare systems and energy production processes.
Middle Class Incentives
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The American Recovery and Reinvestment Act created built-in incentives for middle-class Americans believed to be hardest hit by the economic recession, according to the National Community Reinvestment Coalition. Many of the corporations that experienced economic crisis during the stock market crash received financial assistance and support from the government using tax-payer monies. The rates of job loss and home foreclosures left many middle-class Americans to rely even more heavily on credit cards and loans to meet daily living expenses. The Recovery Act provided tax incentives to working families and small businesses as a way to keep money flowing through the economy in the form of consumer spending. Other financial provisions within the Recovery Act provided funds to examine and strengthen the nation's education and health care systems.
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Projects
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The American Recovery and Reinvestment Act allocates monies for projects involving public services, health care, infrastructure development and job creation, according to Recovery.gov. The Recovery Act provides financial relief for state and local governments to maintain public sector jobs and support existing vital services, such as schools and fire and police departments. Projects aimed toward the health care industry involve shifting medical records management from a paper-based to a computerized system as a way to reduce costs within the industry. Projects designed to create infrastructure development promote research into renewable energy sources and provides grant assistance to companies and households wanting to convert to renewable energy sources. Infrastructure development plans also include construction projects that help to restore the nations roads and highways.
Potential
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The American Recovery and Reinvestment Act works to stabilize the country's economic markets while contributing to its economic growth and stability in the future, according to the National Community Reinvestment Coalition. The government's investment in renewable energy sources is intended to create job growth while promoting self-sufficiency as opposed to the country's ongoing reliance on oil from other countries. Infrastructure development projects also work to create jobs and provide a means for investing in the country's infrastructure, or transportation routes. Projects involving the health care industry are expected to reduce future health care costs by reducing the rate of medical errors and eliminating unnecessary steps within medical documentation processes.
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