Case | HBS Case Collection | January 2009 (Revised October 2011)

Barack Obama and the Bush Tax Cuts (A)

by Matthew C. Weinzierl and Eric D. Werker

Abstract

As his inauguration approached, President-elect Obama faced a financial sector meltdown, a costly bailout, and massive government deficits. With the economy in recession, interest rates near zero, and joblessness on the rise, Obama needed to decide whether, and how much, to use fiscal stimulus to resuscitate the economy. To help students understand Obama's options, the case reviews both the recent tax cuts under President George W. Bush, including the supply-side and demand-management justification given for them, and the broad history of fiscal policy in the United States.

Keywords: Decision Choices and Conditions; Financial Crisis; Borrowing and Debt; Financial Management; Policy; Government Administration; Taxation; United States;

Citation:

Weinzierl, Matthew C., and Eric D. Werker. "Barack Obama and the Bush Tax Cuts (A)." Harvard Business School Case 709-037, January 2009. (Revised October 2011.)