Even if countries began to buy less, the implications of their actions on the global village would be catastrophic. If consumption goes down, then less people will be required to work and companies will have to start making cuts to their workforce because they are turning in less profit. The Buy Nothing Day would throw the world into a deeper recession then it already is in. America and the rest of the world have to consume more and spend its way out of the recession and debt. The United States was built on the principle of having debt and spending its way out of it.
International Trade ECO 372 University of Phoenix There are many contributing factors to the stabilization and prosperity of our global market. We, the United States, are living in a time of severe trade deficit, meaning that we are importing many more goods than we are exporting. While it is nice to be able to buy foreign products at a lower price, there is risk in doing so. When we purchase foreign goods over domestic at lower prices it forces our domestic companies to sell their goods at lower prices to remain competitive. These lower prices may lend to making enough profit to sustain the current workforce.
A 2004 study in the Journal of Human Resources by economists William Wascher, Mark Schweitzer and David Neumark determined that lower-wage union workers typically see a boost in employment and earned income following a mandated wage hike. Never mind the corresponding drop in jobs and earned income for nonunion minimum-wage workers. They may have been priced out of the jobs they need, but that is not the union's concern—its members have landed higher wages and reduced competition for jobs. Such considerations are worth keeping in mind when contemplating the president's wage proposal and the fervent Democratic support for similar and often more ambitious measures, such as Iowa Sen. Tom Harkin's bill to raise the minimum wage to $9.80. Labor unions spent an estimated $174 million on the 2012 election, with 91% of the money going to Democrats, according to the Center for Responsive Politics.
The reasoning being job lossduring the Great Recession combined with higher wages like construction, manufacturing and finance hard, also job growth has is in low-wage industries. This is not a short term trend and the government is showing that to protect its citizens from going below their standard of living, hitting poverty level, more consumers spending and protecting them from employers. The standard of living is different from whomever you may talk to. Setting a minimum wage deriving from ones standard of living has many aspects to it such as; general economic conditions, nominal gross domestic product; inflation labor supply and demand, business operating costs and the number and trend of bankruptcies. Every-one citizen needs to have minimum salary needed to maintain minimum living standard.
The most profound argument in favor of raising the minimum wage circles around the economic stimulus. Raising the minimum wage would not only help thousands of workers out of government assistance programs, but would also boost spending in the local economy on services and goods. While the strongest argument against raising the minimum wage is the uncertainty of the current job market and how it will affect entry-level and new job positions not opening in the economy. When we start looking at how a change like this would help the vast majority of today’s workers, versus the uncertainty of what may or may not help the few, this poses for a weak argument. Assist with the greater good.
With the increase of wages will have tremendous effects on economy because there would be no jobs available left for those who are looking for a job, According to Minimum wages don’t help the poor, “… These jobs enable workers to develop skills and gain experience that ultimately lead to higher productivity and wages.” That is why business is against on increasing the minimum wages and if they did increase it we the customers have to pay higher prices for the services and goods order for the business to make up for the profit they are
Research by economists David Neumark of the University of California, Irvine, William Wascher of the Federal Reserve Board, and Mark Schweitzer of the Cleveland Fed shows that that minimum wages increase poverty; therefore poverty reduction certainly shouldn’t be expected as a benefit of raising the minimum wage (qtd. in the National Review). One of the economists mentioned above, David Neumark states, “The principal sources of an individual’s higher earnings are more schooling and the accumulation of experience and skills in the labor market,” both of which are discouraged by increases in the minimum wage. Neumark, further simplifies this thought in the
Recently, the market is on an uptake with its improving stocks & bonds. The light in a year-plus-long tunnel is bringing both hope and realization. The market improvement is also shedding a truth on a troubling facet of the economy, the 401(K). The realization Stephen Gandel, of “Time Magazine”, has highlighted in his article “Why It’s Time to Retire the 401(k)” focuses on the sad truth that 401(K) is not effective and thus can not be relied on. 401(K) has become ineffective because of the corruption of big business, the misunderstanding of and as a result a mishandling of the 401(K) accounts, and its correlating dependency on the market’s success.
Recession- The recession is an opposite of boom stage. The unemployment increase, most of firms are losing confidence and stops invest or expand. They may change their planning and started to survive. The customers are likely to save money then spend and the percentages of loans are high and may increase. Individuals are losing jobs and the government have to spend more money of benefits.
But not even President Obama’s $33 billion tax credit was not enough to substantially increase jobs in the market. To the contrary, it has gotten more difficult and complicated to keep the job market growing at a satisfactory pace. King claims ”If the Great Recession has taught us anything, it is that planning for the future by saving more and enacting policies that sustain economic growth are what will keep the American Dream alive.” Many economists believe that rather than having the resources divided among different competing groups, individuals should be giving unregulated economic freedom to selfishly improve their lot and eventually their efforts would trickle down to the rest of society. Though this thought actually worked for America for many decades, the global markets no dictate what control we have over the