By no means am I an economic major or am I a political science enthusiast, and I say this with a keen understanding for readers need to be assured by specialists and professionals in their fields. I've just rationalized the conceptualization of our economic crises and drawn up a proposal bailout relief plan based on the simplicity of our crises. Through my knowledge and understanding of the crises and what brought us to economic recession, I've proposed some hypothetical solutions that in a theoretical world would definitely work. I am not writing this proposal to raise a debate as to whether it would work or not but for readers to view my proposal pin point the flaws which would hopefully challenge them to come up with their own solutions.
There should be an imposed National minimum wage, regardless of the state in which you reside. (Which would obviously make some states more favorable than others to reside in but it's not like that is not already the case with certain states such as Oregon and Delaware not imposing state sales taxes).
As an incentive for employers, there should be an employee tax cut. Reducing the taxes employers pay to employ. This idea has caused great debate amongst my own peers leading me to believe that if amongst a few people this idea is such a big issue then it possible would not go over easy with the general public, but in my defense I believe it would work.
Reduction on oil prices, it's a fact that within the last couple of months the price per gallon on oil has dropped but as the American public we have not benefited from this at all. Reducing the cost of oil would also entail reduction in the cost of our utilities such as gas, transportation of freight and other areas that would widely contribute to an economic reawakening.
We obviously know that with the high foreclosure rate in America that the demands on rent would increase so knowing people have to live somewhere, there should be an imposed relief on one of our most fundamental expenses which is rent. The relief should come as rent control or at least some sore of subsidized rent reduction, if not only for a short period of time.
Increase in social security benefits would render more money out into the market. In turn this would increase the demand for goods which would trigger the multiplier effect, in the way where you would create new job opportunities.
Everyone earning less than $150,000 annually would receive free health care or at least some type of subsidized health care.
Social Security benefits, according to the Actuary at the rate we are going social security will not be able to pay full benefits by the year 2040, Proposed solution reduce the cost of living by 1/2% Curb benefits for those earning more than $20,000 a year.
Through analysis and observation I have created some scenario's that may have prevented the financial recession we are experiencing today. The housing market crash was just one factor to our economic fallout. It is not that people began to earn any less that they had when they purchased their homes, to the contrary they earned the same but everything else inflated. When signing these adjustable rate mortgages I assume that most believed that if not at least they would be making more money in five to seven years that the market would still be sufficient enough to justify selling their home. Well with a 3% annual inflation rate for the last five years and no wage increase you start to see where the problem maximized. I suspect that hypothetically if on an annual basis wages would have increased at least 3.5% and inflation would have only factored in at 1.2% the adjustable mortgages would not have been such a mass problem because for the five to seven years of earning you would have been in a position where you would have been able to have money to invest and save and by the seventh year you would have increased your earnings by almost 25%.
Needless to say half of American households live on less than $48,200 a year, the median household income figure for 2006, according to the U.S Census Bureau. Even still with the lack of wage increase US productivity soared during second quarter while labor cost fell, reflecting mix of employment declines and export generated economic growth. Twenty -two percent of U.S. respondents in an ACNielsen study of consumers worldwide said they had no spare cash left after paying for basic expenses. That compares to 17% of consumers in Great Britain and 15% in South Korea and Germany.
Payroll jobs showed loss of 80,000 jobs in August, unemployment rate soared to 6.1% from 5.7%. Even still US workers are increasingly efficient and productive workers become more productive producing more goods and/or services without working extra hours means we are creating a larger economic pie that benefits the whole economy.
Some 9.8% of the population lives below the federal poverty line, according to the Census Bureau (That line varies by household size and composition: for a family of three with a minor child, the income limit would be $16,079.) Wages for American worker has declined 2% since 2003 after factoring in inflation.
About 47 million, or 15.8%, have no health insurance; the Census Bureau reports and medical bills are a factor in half of all consumer bankruptcies, according to research by Harvard University professor Elizabeth Warren. Those who do have insurance often pay a big price: two of five adults who bought health insurance on their own spent more than 10% of their incomes on premiums and family out-of-pocket medical expense, according to the Commonwealth fund, which describes itself as a private nonpartisan foundation that supports independent research on health and social issues. When an employer provided the coverage, one of four of those insured spent more than 10%.
Mark Hamilton
©2008 Supreme Ventures Inc
Mark Hamilton (c)2008 Supreme Ventures Inc
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