Economic Issues in America
- Economic issues fill policy debate in the United States.Economic crisis image by Denis Ivatin from Fotolia.com
Economic issues are said to drive political elections. As Bill Clinton said in his 1992 Presidential campaign, "It's the economy, stupid." Discussions and policy debates about economic issues are constant in the United States as people determine where money should go and how it should be spent. All the debates are in hopes that the decisions will lead to a nation with high economic growth and stable wages for the nation's citizens. - People need jobs to earn wages so they can buy necessities like shelter, food and clothing along with other non-essentials. The unemployment rate is an economic issue in the United States that is dealt with in different ways. Job training programs are sponsored by the federal government as well as government created jobs. Temporary unemployment benefits are also given to those who have lost their jobs due to downsizing. Three types of unemployment exist. Structural unemployment occurs when technology becomes more efficient than workers and when consumers' tastes change. This unemployment can be solved by training. Frictional unemployment happens when a person first graduates from school or is changing jobs and is in the process of looking for a job. This unemployment can be reduced by job placement programs and time. The final, most troubling, form of unemployment is called cyclical unemployment. This happens when the Gross Domestic Product goes down and the unemployment rate rises, resulting in layoffs, like during a recession. Unemployment always exists in the United States. The goal is to reduce cyclical unemployment as much as possible.
- Taxes are used to fund the building and upkeep of roads, hospitals, schools, the military and other government programs. Taxes are also the source of some of the greatest economic debates in the United States. Those who believe in supply side economic theory would prefer fewer taxes. They say that more money in the consumer's pocket means people will buy more and will help to fuel the economy. Those who believe in Keynsian economic theory prefer a higher tax rate that can fund government programs and help to upkeep the nation's infrastructure. Investing in these programs will help create a solid middle class that fuels the economy.
- As globalization grows, countries make the decision between cheaper consumption and protection of their workers. Countries place tariffs on imports to ensure that the nation's citizens continue to buy products from within the country. Free trade agreements eliminate these tariffs. The advantage is that cheaper goods are available and the world economy can grow. The disadvantage is it can result in a loss of jobs as jobs move to places where workers accept a lower wage. The United States has engaged in several free trade agreements including the North American Free Trade Agreement. Some think NAFTA has been a success while others believe it has resulted in job loss for Americans.
