As I mentioned in the former point that the reasons for debt are various such as shrunken tax and public welfare.
When it comes to the shrunken tax, as is known to all, the funds of government are largely from the tax and majority of the taxpayers are from the public, so loss of population is equal to the loss of taxpayers. For example, Bohem (2013) claimed that depopulation is one of the reasons which gave rise to the Detroit Bankruptcy. According to the figure given by Eisenbrey (2013), the city’s population declined from 1.85 million in 1950 to 1.51 million in 1970. Racist behavior was one of the reasons for the loss of population. By 1980, white flight which is a large migration of whites from racial combined urban community to homogeneous
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So people were encouraged to move to Detroit with subsidized money by the state of Michigan and the federal government in order to increase the population. Unfortunately, there was one disaster after another. As it is reported in CBC News, America’s biggest pension plan which is known as the Social Security system was basically broken. Successive governments have inspected the Social Security fund unexpectedly, and were away from premiums increase. By some calculations, $20 trillion of pension which is owed in a long term could not be refunded. For this reason, a lot of senior Detroit 's bondholders who had purchased municipal bonds as a form of substitute pension realized that not all government debt is safe. (MacDonald 2013).
In 2011, the average pension was under $19,000 for non-uniformed retirees. The figure has declined to approximately $12,000 in 2012. In the past, a middle aged employee would get a pension of half of final average pay. Meanwhile, the pension would be climbed by 2.25% of the original pension due to inflation protection(Eisenbrey,2013). Nowadays, low welfare contributed to a situation that a middle aged employee could only receive a pension of less than 50% of final pay and no cost living
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On the one hand, the Government Accounting Standards Board (GASB) asked local governments for publicly report their other post-employment benefits debt in 2006. But, cities were not funded to cover the shortage of OPEB. Finally, as Pozen (2013) said, these obligations were almost always financed on a pay-as-you-go basis. On the other hand, changing healthcare obligation is much easier than pension. Because pension is legally protected by the state constitution, the restriction in changing healthcare obligation is the pressure from the public employment unions. (Pozen,
This deficit has to do with having responsible leader who are willing to increase awareness and make beneficial changes in the nation. In my opinion, the federal debt is a serious threat to the US that must be politically address whenever possible. I believe that the candidates of the 2016 presidential election should make this issue one of the top priorities to discuss and to dictate a considerable amount of work to fix it. That is because the worse the federal debt is, the worse the future would be to the nation. Also, voters must be well educated about this issue in order to shape their decision in voting for the candidate that seems most powerful and confident about this problem. Solving this problem may be difficult and would take time and so much effort. Therefore, the changes and solution must be on both a national and individual levels as
Patrick, C 2004, The Guardian: Australia may hold key to pensions, 12 October 2004, retrieved 21 July 2006
In America’s early days before the kickoff of industry, there was little need for retirement savings for a few key reasons. First of all, people were dying at a much earlier age; most people didn’t live past 38, whereas in 1900, 60 years of age was common for about 40 percent of the population and 15 percent experienced 80 years of life. Another reason for the irrelevance of social security in the 19th century and earlier was that people were usually living rurally on farms with extended families to take care of them. Furthermore, the Civil War also didn’t allow the government much economic room to consider providing a service such as social security. However, after the Civil War, pensions were a form of social security for civil war veterans that carried into their retirement. Unfortunately these pensions provided support for only a very small portion of the population; not even one percent of Americans received these pensions. Despite a much lower need for social security in the 18th ...
Detroit, once known as a bustling city of fast cars and bling, is now known for its poor education system. Detroit, minus its Red Wings, has failed at every turn economically and educationally. With its population cut in half and poverty rates soaring, there is no telling what can stop this disaster of a city. The only hope, it seems, is to better educate the region that Detroit inhabits. Detroit Public Schools has been one of the worst performing school districts in recent years. In 2013, the city of Detroit filed chapter 9 bankruptcy, the largest account of bankruptcy to-date. Good teachers avoid Detroit Public Schools because of the poverty, job quality, and low pay, leaving children with the unqualified teachers they have today in this poverty-plagued city that they call home.
In general, an increase in government spending and decrease in the collection of government taxes and other receipts, increases the debt held by the local government. Government taxes and receipts fluctuate annually, and are frequently less than government spending. In the past, the U.S. public debt has increased for the duration of wars and recessions. When the government consumes more than what it accumulates in taxes, there is a budget deficit and the government then borrows from the private sector or from foreign governments to protect their spending. The compilation of historical borrowing is what materializes the government debt.
Some people believe that immigration in the 1900’s was a good thing, however, they would be wrong. The United States government should have restricted the immigrants around that time. Some reasons are the population, the taking of new jobs and lowering wages, and diseases spreading quickly. These all factored importantly into why they should not have been allowed in.
Clements, B. J. (2014). Equitable and sustainable pensions: challenges and experience. Washington, D.C.: International Monetary Fund.
Gale Encyclopedia of U.S. Economic History. Ed. Thomas Carson and Mary Bonk. Detroit: Gale, 1999.
The spatial isolation present in Detroit deepened anti-integration sentiment, and the resulting shift of whites out of the Rust Belt led to conditions conducive to deindustrialization. However, Sugrue notes that “[racial prejudices] are the result of the actions of federal and local governments, real estate agents, individual home buyers and sellers, and community organizations” (11). That is to say white flight is a phenomenon dependent on political climate rather than being an entirely intrinsic, prejudiced practice of whites. This is an important distinction to make, as it helps reinforce the idea that systems such as poverty and racism are exactly that—systems, and not a result of individual immorality. The same can be said for the urban crisis in Detroit: as opposed to being purely an issue of deindustrialization or poverty, Sugrue argues that the circumstances of Detroit may be in part an institutional problem. “The shape of the postwar city, I contend, is the result of political and economic decisions, of choices made and not made by various institutions, groups and
There are many variations that are often hidden within the special population. As of today the health care system inhabit the margins by exposing impoverished individual. The individuals that are part of the special population each carry a unique set of needs. The special population can consist of the uninsured, minorities, children, disabled people, elderly, prisoners, pregnant women, students, and sadly to say veterans and military personnel. Foundations of the special population consist of maintaining the self-perceived notion that fairness will apply to all individuals. It is important within the special population to distinguish the risk factors that is involved in health care. The best way to complete such a task is applying
All but four countries in the world has external debt (“Country Comparison: Debt External”). Having a debt is almost as common as having a mortgage. Since its establishment, The United States has always been in debt (“Historical Debt Outstanding – Annual”). The US national debt has had five sharp increases previously in its history. The reasons include civil car and the two World W...
http://www.cnn.com/ALLPOLITICS/1998/04/10/polls/social.security/ U.S. News Magazine, Turning 40, March 20, 2000. Vol. 128, number 11 www.usnews.com, 2000 Benefits that last a Lifetime, 1997 Retirement solutions pamplet.
In the documentary, “Cleveland: Confronting Decline in an American City” the short movie analyses the great risk confronting Cleveland as a city as result of deterioration and dilapidation of the urban core. The documentary discusses factors that are responsible for this problem and possible solutions; as this has become a phenomenon, not just in Cleveland but other major US cities. The issue of the urban decline in most cities cuts across people, commerce, and the economy in general. However, the questions of how most cities arrived at their current predicament, consequences of abandoning these concerns, and what can be done to reverse the bad situation, remain unanswered.
Until recently, the term “population growth” has always been regarded in a positive manner; still many people believe that a growing human population results in a growing economy. While many people debate whether a reduction in our total numbers is necessary, others debate what the effects would be. Not only does our population affect the economy, but also our environment, education, quality of life, and everything around us depends on how we react to this growing problem. Our population is growing and we must decide how we will react and what effects our actions will have.
It is difficult to believe that Detroit, Michigan was once known for its economic good fortune and wealth. The auto industry was the economic force moving Detroit into the limelight. The decline of the U.S. auto industry and deep corruption were the primary factors for Detroit, MI becoming the poorest city in America. Detroit went from being one of the wealthiest to becoming the largest U.S. city to ever declare bankruptcy in