Read or listen to the follow article . What is austerity economics? Why Europe doing this? What does the author suggest is the risk? What is the alternative? What do you think? WHo is right? What are the potential consequences?
12 Comments
Samantha Thompson
5/2/2012 02:21:51 pm
Austerity economics is the reduction of government spending, more specifically it aims to reduce the deficit. Europe is doing this because they are emerging into a recession. They are also doing this because unemployment rates are increasing. Author Robert Reich suggests that the risk to doing this would not only worsen unemployment, but it would also take away the public programs and “safety nets” that everyone relies on during a tough time. It can also lead to a political upheaval between Sarkozy and a socialist. By cutting off government spending, there would not be any stimulation to the economy, which needs most of their attention. The goal is to reduce the deficit as a percentage of GDP. The alternative to this would be setting goals to promote employment and not cut government spending at all, once employment is higher and the economy is turning up, austerity can be adopted. I agree with Reich because everyone is relying on the government programs during a recession, by cutting government services, there will not only be nothing for the people who need it most, there will also not be any employment opportunities. Cutting government services will put workers out of a job, therefore exacerbating the unemployment rates. We need to focus on job growth and turning the economy up, anyway we can. If we shift our focus off of the economy, nothing will change. The middle class is already worrying about their increase of taxes; in addition to this, other cuts on spending will be occurring. This will heighten the severity of all potential problems. All attention must be put to this task, then like Reich said, we can turn to austerity economics. It is best to not only learn from our mistakes, but others. Europe’s fail of using austerity economics is an eye opener to us that we should not make a similar mistake.
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Christopher Rusiewicz
5/2/2012 02:57:59 pm
I think that the author of this article is right that we should not fallow Europe into a dark pit of no money. If the government thinks that they can cut funding to are schools business and heath care and make the economic problems go away, there wrong. I agree with the author when he says the way to go is to get unemployment down and then try to fix are deficit. The next presidents whoever that might be better have the common sense to know that or we are all in big trouble. If the government goes thought with this cut on spending we will problem see more unemployment, and when they talk about taxing the middle class more that will only make it harder for them to get by. The only reason that Europe is doing this is that they think that it will help them avoid a recession little do they know that it will make it worse.
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angela reddington
5/3/2012 07:05:02 am
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Ramiro Zarate
5/3/2012 11:07:32 am
Austerity economic is regulation on government spending in order to reduce the deficit, this is going to cause a raise in taxes for middle class. Europe is doing this because they are going into a recession and unemployment rates are very high. The author suggests that what Europe is doing is wrong, according to him unemployment will only increase and more problems would occur, safety nets will be taken away and public services also. The alternative would be to drop the austerity and try to focus on the employment issues, get more people into jobs. I agree with the author the U.S. should not go into austerity because alot more problems would occur, whenever there problems and we find our self in need who could we turn too if the safety nets and public services would be gone? There are many consequences such as higher unemployment rates, loss of belief in the country, and more wealth crisis.
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Cassidy Stanton
5/3/2012 12:10:33 pm
European countries, as are many others, are having many economic problems. The deficit is growing at an unmanageable rate, to combat this, they have adopted an austerical economic plan. Meaning they are cutting down on government spending. The author Robert Reich recommends that the next U.S. president should not give in to doing the same stingy government budget. He argues that austerity in Europe is causing their political and social upheaval. And that the people see the governments thrifty spending as a heartless action in their time of need. Causing them to be open to a different kind of political stand point in hopes of their government funded services to be replenished. I think he may be a little harsh on Europe but I also agree that the U.S. shouldn't do the same cut backs. The alternative is to fund money to public works programs and such in hopes of economic growth therefore stability. This may mean taking loans and some people fear that this will only increase the national dept. But I believe that if the money is put into the right areas, we can keep the faith of the american people and the benefits will out weigh the costs.
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Paul Sargent
5/3/2012 02:18:30 pm
Austerity Economics is the act of reducing government spending so that the impact of the debt that is created wont affect the middle class citizens with taxes and what not. Europe has been in an economic down spiral for awhile now, and at this point the governments there wish to find any means to work their way out of this rut, and the fear is that America is following this harsh tailspin of bad economic times. Like any sort of plan, this one has its own apparent problems, such as if you where to limit the amount a government can spend, yes it puts a sort of safety cap upon possible problems in the future related to money, but it also halts any advancement towards the positive side of the matter (ie. possible chances to bring our economy value up) due to less products available due to less government subsidies. It is an alternative, yes, but it isn't the only one. As voters we should all become well educated upon this subject because in the very near future, we will be the driving force behind whether we give the green light for an Austerity solution.
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Matt Torres
5/3/2012 02:25:58 pm
Austerity economics is the act of regulating government spending, specifically striving to reduce the deficit. Europe is doing this because their unemployment rate just keeps getting higher, and they are entering a recession. In this article, the author suggests that the risk in doing this would make unemployment rates even higher. It would also cause public programs and safety nets to vanish, which is what these people rely on during hard times. The alternative would be to set a goal for growth, employment, and maybe even hold off on cutting government spending. In my opinion, the only path to continue on is to get unemployment rates down. We need to focus on providing more jobs and helping our economy. When it comes down to who is right, it’s hard to say because there’s good arguments coming from both sides. Potential consequences are things like unemployment getting worse and cutting spending isn’t going to benefit anyone in anyway.
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Valentina Sainato
5/3/2012 02:56:30 pm
Austerity economics is essentially a strict economy having very little government spending with the goal of reducing the deficit as a percentage of GDP. Europe is partaking in austerity economics because they feel it will directly diminish their exponentially growing debt. However, what they don't realize is that austerity economics is only pushing them further into their recession; it's like taking one step forward and two steps backwards. It is also increasing unemployment and decreasing the amount of services available to help those in need. Reich suggests that although Europe is currently too dependent on their ways, America may be able to relinquish the idea of austerity economics before it affects us too severely. He argues that rather than reducing our government spending, we should set goals to improve growth and employment as a means of benefiting our economy. I agree with Reich, because Europe is an entirely different culture than America. What may work for the people there may not necessarily work for the people here. My opinion is that in our current recession, we should focus on increasing job growth and stabilizing the economy through that, rather than cut workers and exacerbate the unemployment rate.
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James "The King" White.
5/3/2012 04:14:45 pm
Austerity economic is used to restrict the government involvement on economic spending. As europe begins to use Austerity economics to try and steer away from recession and debt. infact it does the complete opposite and strives them toward a goal they are attempting to move from. I happen to agree with this article and author, i believe in our country decides to follow europe in this attempt to save ourselves, it will only burden and drive us closer to recession. While keeping in mind that America and Europe set themselves in different standards of an economic standpoint i would argue that doing this is extremely un beneficial. in addition this would not help unemployment in the slightest and that is currently a huge player in todays american economy.
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Geoff Thompson
5/3/2012 04:47:00 pm
In economics, austerity is a policy of deficit-cutting, lower spending, and a reduction in the amount of benefits and public services provided. Austerity policies are often used by governments to reduce their deficit spending while sometimes combined with increases in taxes to pay back creditors to reduce debt. in America's situation of massive debt it is a very plausible possibility for our government to adopt an austerity policy. of course the risk of an austerity policy is that it lowers the standard for living in general and in Greece's case could cause an uprising of riots and protest. i think that there is not much else we can do to effectively pay off our debt in America and even an austerity policy wont accomplish that.
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Harrison Reilly
5/8/2012 08:41:00 am
Austerity is the action (taken by the government) of deficit cutting to reduce spending in order to correct a country's economy. Many European nations are in debt, so for most of them this is the last resort in order to save some money and not have the country to go under. This also results in higher taxes. For the most part, this kind of economic strategy is extremely unpopular with the people, creating political upheaval. The other option is to do what President Obama did, which was to stimulate the economy by creating jobs and getting money TO the people. I think there needs to be a delicate balance, a nation cannot leave their people behind, it simply isn't right. But they also can't let their economy crumble from under them. Ultimately, there isn't any right answer. Going too far one way can result in a political disaster, making people lose faith in their governments.
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Jesus Reyes
6/5/2012 04:13:10 pm
Well austerity economics is when theres alot of unemployment, and when the government is spending money that is hurting the country everytime because that money is what we need and more because theres alot of unemployment in the country, risk that will happen if we go to austerity is that theres i not gonna be public services, it would be more limited than how it is right now, like schools will become private because we are gonna have to pay for education, public transportation will be more limited for people it will be more dificult than how it is, well USA can prevent this before it happens, because in Europe theres alot of unemployment and that causes austerity, so USA should give more job opportunities to prevent this and stop spending money on other things that wont help the country.
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