Fiscal Consequences of Economic Failures June 13, 2007 is the day Richard C. Cook states in his article: "It's official: The collapse of the US economy has begun" . Over the past two years, months and weeks, the US economy and stock market have shown the world significant failures and inefficiencies. Perhaps the clearest evidence of the recent economic meltdown is the subprime mortgage problems that began just over a year ago. The bursting of the US housing market bubble was caused by a combination of risky lending and borrowing practices and higher interest rates, combined with falling home prices, which made refinancing more difficult. Compounding the drama, Wall Street's excessive debt and unsustainable practices have become increasingly transparent. There has been and still is tremendous turmoil among the mammoths of Wall Street and the drama is certainly no longer fun or cheap. The fiscal consequences of these economic failures are difficult to measure. However, Steven Pearlstein of the Washington Post estimates that “falling stock prices will lead companies to reduce hiring and capital spending while governments will be forced to raise taxes… as capital gains tax revenues decline.” Furthermore, “the combination of declining wealth and higher interest rates will eventually lead consumers to withdraw debt-financed consumption.” Congress and the Bush administration passed an economic stimulus package on February 13, 2008, and the Federal Reserve cut interest rates in hopes of addressing and mitigating liquidity and credit problems. The stimulus package provides tax relief for low- and middle-income U.S. taxpayers of $300 per person and $300 per dependent child under age 1… half of the paper… more research is underway and assessments needed to decide which candidate truly has the best tax plan for the United States as a whole. Works cited “Economic Stimulus Act of 2008.” Wikipedia, the free encyclopedia. October 13, 2008, 00:09 UTC. October 14, 2008 “Emergency Economic Stabilization Act of 2008.” Wikipedia, the free encyclopedia. October 12, 2008, 00:33 UTC. October 12, 2008. “Liberty Tax Reviews Emergency Economic Stabilization Act of 2008/$700 Billion Rescue Plan.” Freedom Tax Service. October 13, 2008. October 13, 2008. “Obama and McCain Tax Proposals.” Blog by AE Feldman. . August 21, 2008. October 14 2008.