Wasteful Government Spending A major problem today in the United States government is agreeing on a balanced federal budget. When a government cannot balance its budget or it spends more money in a year than it receives in revenues, a deficit occurs. One reason congressional leaders cannot come to terms on a balanced federal budget is because of the wasteful government spending that occurs. Congressional leaders believe that some government programs should be passed on to state and local governments while others believe the programs are inefficient, mismanaged; outdated and unnecessary programs that should be eliminated. In order to manage these problems, Congress will need to make hard, necessary changes that will affect all people so the government can run more efficiently.
To rid out economy of the penny, the government would first needed to confront a public greatly in favor of preserving the penny. As indicated by Source E, a poll by the prestigious Harris group, public opinion shows a strong desire to keep the penny. Not only in removing the penny would need the census of two-thirds the population of these view, but also the physical wealth needed to fund for such costly and logistically near-impossible change. As shown in source A, state economies that depend on penny production for continued prosperity, such as Tennessee, would suffer economic adversity if this was to be amended. In the end, the benefits to be reaped by ending the penny are not worth the investment involved.
Debt appears everywhere in daily life. Most citizens have that experience; they spend more than they earn on their monthly paycheck and live in debt. Similar to such an instance, our economy experiences annual deficit spending. National debt is the total outstanding borrowings of a central government (WebFinance Inc), in other words, the accumulation of our annual deficits. In order to combat this deficit spending, taxes are increased to generate more revenue to pay off this spending.
It has also been pointed out by Richard Dreyfuss, writer for the Manhattan Institute, that “...pension obligations now threaten to outstrip the government’s ability to pay, since the investment risk and any resulting deficits are the responsibility of the taxpayer”(2). Dreyfuss’ point helps to highlight the fact that the entire economy will be impacted by the impending pension crisis. Taxpayers will be forced to make up the difference that remains once the government decides it cannot afford to
In their research paper, the economists also argue that a balanced budget amendment likely would inspire the government to increase savings to hedge against future problems in the broader economy. Crisis Response A key concern frequently raised about a balanced budget amendment is the lack of flexibility it allows. Because the budget is required by law to be balanced, the federal government has fewer options for responding to economic developments as they arise. Although an
The impact of the opinions can lead to changes within government and how to deal with further occurrences of major political or economic upsets. Macroeconomics might be about the economy abroad, but it has the tiniest effect on even the smallest part of our lives. To further explain macroeconomics, look at all the potential factors of change. With this known, the pricing of stocks, government bonds, and corporate bonds are affected by the release dates of the consumer price index (CPI), unemployment rate, nonfarm payroll, and the federal funds rate (Brenner, Paquariello, and Subrahmanyam 1266). These have major effects on how companies will respond to the effects by the price of their goods, and the availability of these goods.
Foreign product taxes, or tariffs, were initially imposed to help in the growth of our country by keeping infant industries alive, as well as to bring in revenue for the United States federal government in its early days. But, as time has gone on, people have started to question whether these protective measures are actually helping or hurting us. And after much research, I can definitely assure you that tariffs are detrimental to our country’s well-being. By having these taxes on foreign products, people are naturally going to turn away and opt for something cheaper. So when these domestic companies are getting a steady flow of customers and income, they no longer have any need or incentive for improving the quality of their products.
To solve this market failure, government intervention seems to be the only feasible solution so far. The government can either subsidize or ban unpaid internships. However, subsidy is not reasonable because based on cost-benefit analysis. It costs the government too much to solve this market failure. On the other hand, banning unpaid internship opportunities is not effective because if business could not afford to provide internships, young graduates cannot gain experiences and provide positive externalities to the society.
This debt has been accumulated over the past thirty years and has been growing much faster than the overall level of GDP. This poses serious threat for the economy as sooner or later this debt bubble will burst just like the housing bubble which led to the financial crisis in 2007. The bursting of the debt bubble will cripple the entire economy as it has become dependent on borrowing and debt. Nearly all the transactions of the economy is done on a credit basis, adding to the overall national debt. A burst of this bubble would affect the increasing standard of living being enjoyed by the citizens of America today.
The United States is supposed to represent and promote peace and global prosperity. It is contradictive to desire world peace and global prosperity when the fundamental way of ensuring continued U.S. dominance across the spectrum by having the most military power. Instead of building peace with other countries, we are instilling fear in them by showing if things don’t run our way, we’ll send troops into your country and forcefully take over. A high military budget isn’t needed because we simply can’t afford it. The ridiculous portion of our budget that is spent on defense could be much better spent on social welfare, health, and education.