The economy needs to generate wages, consumption, investments, imports, exports in order to be a fully employed economy. In order to achieve that, economy needs people to work, and people need to work in order to provide for their families and themselves, but the market, or the government it’s not generating the enough jobs that people need to, bringing unemployment rates up. Statistics from the Bureau of Labor Statistics Data show that the current unemployment rate is 6.3, considered relatively low comparing it to previous years, starting from the last months of 2009 with an unemployment rate of 9.9. Although is true that the government, or the market itself has created more jobs, and less people are unemployed than previous years, the objective here is to get to the “ideal” unemployment rate, an economy that lacks of cyclical unemployment, meaning when workers lose their jobs because of a fall in GDP, inferring that the best solution to create more jobs is by increasing or having economic growth. Let’s start by explaining completely my point of view, if the demand for a good or service increases-meaning consumption increases- businesses need to find more workers, in order to have enough to cope with the demand. Also if people are consuming more, business will start to invest more, because they are getting more profits, creating even more jobs in that process. So, what are the ways in which the government would increase the economic growth? Taking the position of democrats, I will have to say that the best way to increase economic growth would be by the redistribution of the wealth by increasing the minimum wage, and government giving more grants and loans to those students who want to become professionals and successful.
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...bs, but those at the long run end up having a bad effect on the economy, creating deficits, followed by a recession.
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In conclusion, the current macroeconomic situation in the United States is characterized by moderate growth because of better economic conditions that were brought by the events of 2013. The country has experienced moderate economic growth since the 2008 global recession but has shown real signs of momentum. While the country is not concerned about recession or inflation, the rate of unemployment is still a major challenge despite improved consumer and business confidence. As a result, the Federal Open Market Committee or Federal Reserve System needs to adopt fiscal and monetary policy initiatives that help address the unemployment issue and promote high economic growth.
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The minimum wage has been a policy tool used in the United States since its establishment with the Fair Labor Standards Act in 1938. It has been uses as a tool to remedy some of the effects of poverty by raising the wages of the low wage workers. It has long been the worthy goal of many policy makers to find solutions to alleviate pove...
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Many people against raising the minimum wage create arguments such as, “it will cause inflation”, or, “ it will result in job loss.” Not only are these arguments terribly untrue, they also cause a sense of panic towards the majority working-class. Since 1938, the federal minimum wage has been increased 22 times. For more than 75 years, real GDP per capita has consistently increased, even when the wage has been
About eight million Americans go to work every day, yet they are still living below the poverty line (Camden and Stern). More than one million of them are retail workers. If the minimum wage was to escalate, 734,075 people would be lifted out of poverty. Also the 769,191 people that are living on or near the poverty line would see their incomes go above it by 150 percent. These workers are struggling to provide basic necessities for their family and themselves. If minimum wage was increased poverty could be reduced. Most families are relying on government assistance to provide things such as food by using an EBT food stamp card and Medicaid because they are making minimum wage. Also if a minimum wage worker is only making $5.15 per hour, it will be impossible trying to afford health insurance. Sometimes the benefits workers receive don’t always cov...
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In time of economic crisis the government has a choice to cut spending or increase spending for public goods and services. “In 2009, Congress passed the American Recovery and Rein- vestment Act, which authorized $787 billion in spending to promote job growth and bolster economic activity”(Stratmann/Okolski 3). John Maynard Keynes, an economist of 20th century, suggest that the government should run a deficit if it will create jobs and increase capital gain. This theory support the current stimulus package that has been introduce during President Obama’s term. Although the flaw with this concept is that it makes the assumption the government has done studies and understands which areas needs the funding the most and knows where it will be beneficial, realistically that is not true. “Federal spending is less likely to stimulate growth when it cannot accurately target the projects where it will be most productive” (Stratmann/Okolski 2). This can be seen because political figures will spend money where it directly supports their needs as well. For instance, the political figure would rather spend money to things that will yield a p...
There are a multitudinous number of both economic and social difficulties associated with unemployment. One fundamental reason why the government particularly stresses on reducing unemployment levels is as a result it poses a great cost on the economy. Not only does it affect the economy, but also it poses a great threat towards the living standards of the unemployed people itself. This could lead to many receiving less or no income based on whether or not they receive unemployment welfare benefits from the government. Reduction in income, would lead to a less disposable inc...
Bernstein, Jared. “Would Raising the Minimum Wage Harm the Economy?” The CQ Researcher 16 Dec. 2005:1069.