Obviously if nothing is done to help reduce unemployment in America, it will continue to increase until the economy collapses from not being able to support such a dangerously high unemployment rate. This is clearly an extreme and worst case scenario, but it could happen if nothing is done at all. Because Unemployment is such a huge topic, I think the best way to show its implications is to illustrate piece by piece what will happen if certain ideas are not implemented. Unemployment benefits must continue to be made available to idle workers or else an estimated 3.2 million Americans would lose their benefits resulting in "financial, social, and psychological distress for millions of households." Without benefits these workers will be unable to focus on finding a suitable job and go into a state of panic about how to support their family. Not extending the Bush Tax Cuts would be a tremendous blow to the U.S. economy. The current debate is over whether or not to include wealthier Americans and corporations into the new extension. I say include everyone. Not doing so would limit the expansion of larger corporations who would have the ability to hire more workers if they were given tax breaks. Smaller corporations will be able to grow thanks to the tax cuts, but they will be unable to absorb as many unemployed workers as larger corporations would. Thus, by being selective on the tax cuts less jobs would be created and less money would be pumped back into the economy. Not extending the Bush Tax Cuts will hinder economic growth in America. There are many other plans designed to fight unemployment, but these are the main two I have come across during my research. If nothing is done to help reduce unemployment in America, I am confident that we will witness increased job loss along with a quickly collapsing economy.
I'll admit, when I see newspieces on the housing crisis or the unemployment rates I usually don't pay attention because the information is thick and depressing. However, the way you've presented the implications is different and very interesting! Like I said, I do not have much knowledge on the matter, and this may be ignorant, but I can't help but wonderi if more tax cuts are implemented how will the unemployed benefits be paid for?
ReplyDeleteI think the unemployment crisis definitely fits the saying ignorance is bliss. It is such an upsetting and scary topic, which makes it understandable that many people chose to not get caught up in its entirety. However, completely ignoring this topic would be a very dangerous and irresponsible action. This issue affects everyone in the United States so it is important to at least have a moderate understanding of what is going on so one can be better prepared for the future.
ReplyDeleteYou ask an excellent question about tax breaks and unemployment benefits, which I will be glad to answer. President Obama has already extended the unemployment benefits so those have been paid for, despite adding more to the national debt. The Bush Tax Cuts however, have yet to be extended and that has been the source of numerous political debates. Now these tax cuts will just result in a loss of revenue for the government as tax payers and companies will pay less in taxes. However, the idea is that with people and companies surrendering less money to the government they will invest it in buying more goods and expanding their business, thus stimulating the economy. Extending the tax cuts doesn’t require spending a great of money, but rather temporarily forfeiting government revenue to boost the economy. In the long run, once the economy gets back on track, more people will be able to pay higher taxes so the government will eventually make up the revenue it forfeited.