Economy
final
United
States of America has a population of about 313,847,465 people. The population
of persons between the age of 16 and 64 is about 208,599,130. This is the
active population which runs the economy around. Though the country is one of
the world’s biggest economies the unemployment rate is still a national
problem. Americans who live below the poverty line constitute about 14 percent
of the total population. The country’s unemployed population stands to about
7.9 percent of the total population. America has a national dept that is about
69 percent of the country gross domestic product (GDP) (John, 2012). The country’s gross domestic product is
$48,000 per capita. America has a good technology hub that includes good
infrastructure and communication. Service industry is the biggest economic
performer in the American market. Agriculture also performs relatively well but
not to the standards of its full potential.
Inflation rate by October rose to 2.16 percent. After identifying this entire loop in
Americas’ economy the question arises if USA can be put back on its track? Ofcourse,
there are measures that all Americans can take to solve this problem so that gradually
the economy starts to improve and rise to its standards (John, 2012).
Productivity
Public sector which has minimal returns
to the economy such as education and health care services need be made more
efficient to attract people from other countries thus earning the country more
returns. Productivity in such sectors in a certain period will have returns and
annual saving of up to one hundred billion to three hundred billion dollars. In
addition, education tourism will earn the country relative high returns (Adam,
Christian, 2011). Americans have to improve its education sector to embrace new
technology to fit with the worlds needs. The result is to sell its professionals
to other countries of the world. IT infrastructure improvements will also
reduce imports of such personalities from other country. The country also needs
to build a talent pool on line with the economy future plans. America is at risk of a decline of its technocrats. In
aerospace for instance, 60 percent of its workers are aged over forty five
years old. This means in twenty years time the sector will have a shortage
sabotaging the economy. The country need to reduce barriers of immigration of
professions in this sector in order to encourage growth and diversify of knowledge
and skills.
The American infrastructure is not of up
to date. It requires upgrading and renovation especially in areas hit by
hurricane. Today the country is ranked twenty third in its infrastructure
quality. The consequence of this is the decline in international investors who
have relative contribution to the economy. Moreover, unfair business policies
affect the country’s output. The country needs to formulate proper and fair
policy to promote competition and to attack more investors in America. Taxation
is the major pull back of America’s economy. The other setback is financing;
most Americans are highly innovative but lack a starting capital. The
government needs to set aside some amount for the purposes of promotion of
innovation. It may not realize immediate returns, but it secures the future of
America’s youth (Adam, Christian, 2011).
Global energy demand rises with the improvement
in technology. America’s energy needs also rises with time. This needs will
definitely rise in the future. Renewable energy source currently stands at 20
percent. The government needs to create incentives and proper policies for
growth in renewable energy sources so to avoid the risk of food security and
destruction of land resource. Wind energy and nuclear energy need to be given
much attention among other renewable energy sources. Fossil energy drilling
needs to be regulated since it is the number one environmental polluter and
cost the government a lot of resources. The poor and developing countries demand
compensation from the government because of global warming.
Other sectors such as tourism need to be
given much attention because it contributes to national revenue. America needs
to create a hub of the best quality in all sectors to set an example for other
government and investors. Education, information technology and infrastructures
attract other people to visit the state earning the state revenue. This will
raise the GDP annually by a big margin.
Unemployment
All
persons who have no definite payroll at regular intervals are considered
unemployed. As indicated by the bureau of labor statistics the unemployment
rate in august 2012 was at 7.9 percent of the total population. The figure
though improving but there is an indication that as time passes by most
Americans will not be on a definite payroll. Thus, the rate of unemployment is
expected to rise. (John, 2012) To solve this menace and to secure the future of
the generation to come there are various things that could be done. Small and
medium size enterprises are the major job creators. Such firms have an edge of
expansion thus increase its labor force. The federal and the state governments
are required to ease taxes on the operation of such enterprises. This can be
done through passing policies that favor emergence of such businesses. This
will decrease government revenue through taxes at its implementation, but after
a while there will be an increase in returns on the government budget.
Education sector can also create jobs
for many American people. If Americans diversify its education to fit world's
interest thus the epistemic class and professions will be exported to other
countries to offer their services earning the country foreign income. The
living standards of most citizens will definitely rise from the incentive, and
this will marginally reduce the rate of unemployed persons in America. In
addition, the curriculum needs to incorporate programs that involve interests
and talents of its students. Sports men and women earn the country a lot of
money, but that is not to the country’s full potential. Athlete wins to about 1,000,000 dollars on
golden jackpot. This is just an example. There are a lot of prices attached
games, sports, arts and films. If Americans curriculum give more emphasis of
talents and student’s interests the country will be enjoying high returns and
encouraging investment and tourism earning the country income.
Inflation
Inflation simply means a lot of money
that has a very minimal purchasing power based on consumer price index (CPI).
In October 2009 inflation rate was 0.183 percent compared with today’s 2.16
percent. This is an indication that the inflation rate is on the rise but not
by a large margin. This type of inflation is referred as creeping inflation
(John, 2012). It is sometimes considered essential in an economy. This has a
lot of impact in major economies such as America’s. To ensure that the
inflation rate remains relatively low several measures has to be taken. The
amount of money in circulation is one measure to control inflation. The
Americans who earn more income should be taxed more than those who earn a small
amount of money. This money can serve the other states activities. Moreover,
the government should cut off its non essential expenditure in a fiscal year.
This is because more public expenditure increases the rate of inflation. Production
of scarce goods should be increased as this will not only decrease inflation
rate, but also increase the number of employed persons. In addition, the scarce
goods in American market should not be exported, and savings should be
encouraged. This is because when spending surpasses saving it will lead to a
lot of money in circulation.
The National Debt
The county’s national debt is about 16
trillion dollars. To settle this debt it has an implication that every citizen
has to pay 20 percent in taxes despite the social class. This is an unfortunate
measure and exploitation of the citizens. Alternatively the state may pay the
debt by public money which will have a serious implication on the economy. The
most appropriate way to curb this problem the government needs to encourage
investments and increase in national output. This will increase government
revenue collection thus filling the government budget deficit and saving other
amount in bonds which will be used to pay up the national debt (Rochelle, et al,
2004). In controlling inflation it is mentioned that the government should
control the amount of money in circulation. This money is also used in paying
up the national debt.
Balance of Trade
This is the difference between the
amounts of a country's export compared to its imports. In September the United
States of American exported goods worth 187 billion dollars which is relatively
low compared to goods it imported. The imports in the same month were 228
billion dollars worth (John, 2012). The main imports are petroleum products,
medical technical equipment, machinery and vehicles. With gums and resins are
increasing significantly. To cut off the deficit of trade the government need
to encourage the indigenous firms producing the goods of America’s imports. For
instance, companies such as Ford should be encouraged to produce more of its
product to suit the Americans need and should sell their products locally at
fair prices. Goods that are produced locally and are scarce should not be
exported. Their exports will lead to more deficiency thus importing more at
higher prices. This will narrow down the country’s balance of trade (Rochelle,
et al, 2004).
Work cited
Adam
Hersh, Christian Weller. “The State of American productivity growth Boston”. Center
of American Progress. University of Massachusetts, 2011. Web. 04 Dec. 2012
Economy at a Glance. Federal Reserve
Bank of Cliveland. Web. 04 Dec. 2012
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