Category: National Debt

US Budget Deficit and Public Debt

The 2008-2009 Financial Crisis which is commonly known as the “housing-bubble” threw the United States but other international economies into a severe recession. The first crackle of this panic was the credit boom in mid-2007. This was all influenced based on the rapid growth in credit accompanied by unstrict standards and regulations. Following the credit boom was the meltdown of subprime mortgages and other types of financial securitized products. The complexity and interlinked factors behind the rise of the ‘08-09 were the loosening of monetary and fiscal policies. GDP is the broadest gauge of economic condition, it is the natural place to start in analyzing the business cycle (Mankiw, 2009, pg 276). The Great Recession started late 2007 which was the peak of the business cycle. The peak of the business cycle is described as when business activities have reached a temporary maximum, the economy is near full employment, and the level of real output is close to the economy’s capacity. The third quarter of 2007 to the third quarter of 2008 the economic production of goods and services was approximately flat (Mankiw, 2019 pg 275). Real Gross Domestic Product (GDP) plunged sharply after the end of 2007 by 4.3% to trough of 2009 (Figure 1). Analyzing the decline in GDP, the major variables to look at are the consumption and investment panel. The shaded bar in the graph represents periods of a recession. The relationship between consumption and investment are positively related. In the period of ‘08-’09, there is a steep decline in consumption and investment. (Figure2 : a & b). When the economy heads into a recession, households, firms, and government respond to the fall in their output by consuming and investing less which has a negative affect in business generating revenue, forcing them to layoff employees.

According to FRED, from 2007 to 2009, there was a sharp increase in federal deficit of about -10% (Figure 3). The total debt as a percent of Gross Domestic Product increased from 62.86% at the end of Quarter 4 of 2007 to 82.59% in the third quarter of 2009. In Figure 5: Federal Debt: Total Public Debt, it shows the growth in total public debt. During the recession in U.S., there was a spike. The United States budget is determined by government spending and tax revenue. Government purchases are goods and services bought by the federal state and local government, excluding transfer payments. Some examples of government purchases are military equipment, infrastructures, and services provided by government workers (Mankiw, 2019, pg.27). Tax revenue is the collection of taxes on income and profit, taxes levied on goods and services, corporate taxes, property tax, estate taxes, and many others. During the recession in the U.S., government spending outweighed tax revenue budget deficit.

From the start of Financial Crisis in fiscal year 2008, the outlays of the U.S. government continued to rise at a great pace until 2010, with a total of about 5% of GDP. In the meantime, the revenues declined sharply, from 18% to 14.5% of GDP. These increase the national budget deficits to a large extent. However, after the fiscal year 2010, government spendings gradually decrease to the average level, which is 20.5% of GDP, and revenues also go up back to a steady level of about 17.4% of GDP. According to the table in the article US Deficit by Year Compared to GDP, Debt Increase, and Events, the U.S. government had a total deficit of $459 billion and owed $1,017 billion debt in the fiscal year 2008. And the deficit-to-GDP ratio was 3.1 percent. Bank bailout and Quantitative Easing were two major events which were affecting this ratio. As the Stimulus Act and Obama Tax Cuts were introduced, for the next four years, from 2009 to 2012, the budget deficit and national debt were both maintained at an over one-thousand billions high level, with the deficit reaching its maximum of $1,413 billion in 2009 and debt peaking at $1,905 billion in 2010. Since 2013, US budget deficit declines back to a lower level and fluctuated between $450 billion to $750 billion approximately. But the national debt was not so steady relatively, which went above $1000 billion again in 2014, 2016, and 2018.

The drastic shifts and changes in the U.S. economy influenced Congress to pass The American Recovery and Reinvestment Act of 2009. It is also known as “stimulus package of 2009” or the Obama stimulus pack. President Obama took office in January 2009 right after the U.S. economy suffered from a deep recession. It was signed February 17, 2009 to jumpstart the economy, create or save millions of jobs, and put a down payment on addressing long-neglected challenges so our country can thrive in the 21st century (National Telecommunication and Information Administration, 2019). The act was to promote economic recovery from the 2008 Recession and spark growth. As proposed, the package would cost the federal government about $800 billion, or about 5% of annual GDP (Mankiw, 2019, pg 315) which included tax cuts and higher transfer payments, but much was made up of government purchases of goods and services. John Maynard Keynes, a British economist believed that the problem during the recession and depression is inadequate spending and the best way to understand it is through the Keynesian Cross. When the economy is at equilibrium, actual expenditure equals planned expenditure but that was not the situation during the Great Depression. In the Obama stimulus package, increased government spending was one of the objectives. As government purchases rises by △G, the planned-expenditure schedule shifts upward by △G. Applying the objective of Keynesian Cross, an increase in government purchases shifts the planned expenditure line up by △G. The equilibrium moves from point A to B which causes income to rise from Y1 to Y2. The △Y is larger than △G. The ratio △Y/△G is called the government-purchases multiplier, which tells us how much income rise in response to a $1 increase in government purchases. When the government purchases raises income, it also raises consumption, which further raises income where raises consumption, and so on (Mankiw, 2019, pg 311). An increase in government purchases causes a greater increase income. The government multiplier under Obama administration was 1.57 (Mankiw, 2019, pg 315).

A Cause and Effect Essay on The Impact of National Debt on The US Government and Its Citizens

This paper will address the numerous causes and effects of the United States’ National Debt, both on the US citizen, the US government, and the world. Firstly, however, a parallel must be made. Beginning in 2008, the Eurozone member nation of Greece entered a crippling and tumultuous economic downturn that has crippled its government and caused panic among global financers. Despite three substantial bailouts from the International Monetary Fund, the European Central Bank, and its neighbors in the European Union, Greece largely failed to recover its economy. With a 25% unemployment rate and extreme austerity measures in place, its economy is in a poor state, and the accruement of billions of euros of debt to its creditors has made true stability a far off dream. Greece narrowly avoided a default in fact, only scraping by due to its creditors being extremely lenient and altering their payment deals. (“Greece’s Debt Crisis Explained”)

Greece has a national debt of roughly 391 billion euros, or 428 billion US dollars. This total comes out to a little over 180% of Greece’s GDP, or gross domestic product, the total sum of all goods and services produced and sold in the country per year, arguably what the country is worth. Thanks to interest rates, the Grecian debt rises by 875 USD per second. Greece has slid into the grey zone of paying off credit with credit to avoid default at this point. They are a poster child for what irresponsible economic policy can do. So what does this have to do with the United States’ National Debt? (“Greece Debt Clock”) Greece serves as an important warning, and a solid example of what could happen to the United States on a smaller scale. Where Greece bears a debt of 428 billion US dollars at 180% of their GDP, the United States bears a national debt of 18.6 trillion US dollars at this time of writing. That’s roughly 106% of the US GDP. The United States massive economy allows for significantly more debt to be accumulated before extreme economic downturns, but we are rapidly approaching that point. (“United States National Debt Clock”)

What does this mean? What can debt do the country? The effects are far reaching and devastating. A nation with cripplingly high debt will experience a decrease in investment, an extreme slow-down of economic growth, and most damningly rapidly growing inflation and debt taxes. Each of these facets in smaller doses harm everyday citizens, and on larger scales can incite wars and end nations.

Economic studies show that for roughly every 100 billion US dollars added to US debt each year, there is a net impact of 102 billion US dollars shaved off of expected growth of GDP over the next ten years. In other words, for every dollar that the US government adds to the national debt, the total value of the US economy permanently decreases by a little over that amount over the next ten years. The current economic system is in many ways unsustainable if we continue to accrue debt, as our GDP will find itself unable to balance out to our growing interest rates. This happens largely due to the fact that interest on private investment is kept low by the Federal Reserve in an attempt to combat growing deficits, and the ever increasing need for tax hikes to fight the mounting debt each year causes investment to fall period. (“High Debt is a Real Drag”)

This slow downturn is something that is regularly ignored when budget policies are reviewed in the House of Representatives and the Senate, as it is generally regarded as something that can be addressed at a later time. The most attention the national debt gets from politicians is when the debt ceiling is approached. The US debt ceiling is a cap on the Federal Government’s ability to borrow on interest, one which has simply been risen each election cycle instead of working as intended to cap off borrowing. (“Debt Limit”)

Of more important long term note from national debt is the resulting tax hikes and inflation of the US dollar. The only two ways to address rising debt is to decrease spending and increase income. Unfortunately, for over fifty years the United States has seen only increased spending in all areas, with no sign of stopping. As such, many politicians turn to the other option in the form of tax increases. While theoretically good for helping to make interest payments, such hikes tend to hurt the economy more in the long run by decreasing the overall amount of money invested by citizens into said economy. Beyond that, the Federal Reserve attempts to control debt by issuing new currency to help pay it off, an act known as inflation. In the past, a dollar had a set value based on the price of gold. This gold standard was removed and replaced with what is known as fiat currency, where the value is based on what the government says it is. Under this system, the more dollars there are, the less they are worth compared to other currencies. As such, when the Federal Reserve issues new money into the system, such as when they bailed out major banking firms during the 2008 recession, the value of everyone’s dollars around the world decreases. Two prime examples of where inflation got out of hand and resulted in national collapse were in ancient Rome, and Weimar Germany. Rome’s national debt spiraled out of control, requiring the Empire to mint more and more silver coins to finance its legions that were fighting to put down peasant tax revolts. Rome eventually split and collapsed into waring nation states, and never recovered to its former glory. (“America Far too Similar to Ancient Rome”) Weimar Germany struggled to finance its massive war effort as the Allied powers demanded WWI reparations. It got to the point where Germans burned Marks, the currency of the day, to heat their homes. They had to go food shopping with wheelbarrows of money to be able to afford anything. (“Hyperinflation in Weimar”)

So what does this mean for the United States? The US dollar isn’t at the point that the German Mark was, but it’s moving in that direction, and the repercussions can already be felt. A product that cost 20 US dollars in 1915, produced and sold the same way, would cost 470 US dollars today due to inflation. (“US Inflation Calculator”) Even now, you’ll hear arguments about minimum wage and how it hasn’t caught up with the Cost of Living. While market prices largely affect the Cost of Living, a major contributing factor is inflation, and when the minimum wage was first implemented, it largely was kept in line with inflation. Now, this is no longer the case, and those living on minimum wage find themselves in difficult economic situations. (“Deflating Minimum Wage Costs Workers Billions of Dollars”)

So where is all this money that the United States is spending going? Is the spending worthwhile? To answer this question requires an explanation of how Federal spending works. The United States borrows and spends on a near incalculable scale, so overall details in this paper will be sparse, and focus on a few major key points. The Federal Government has a few types of spending, the two most important being Mandatory, and Discretionary. Mandatory spending is what’s applied when laws are put in place to distribute money to programs. Examples include Highway projects, Social Security, the new Healthcare programs, Retirement programs, and funding for Federal offices. Discretionary spending represents about one third of the yearly budget, and is broken up between numerous departments in the Government, primarily the military. (“Federal Budget Glossary”)

Discretionary spending is the easier of the two types of spending to address, so this report will begin there. The 2015 Federal Budget’s Discretionary spending fund was roughly 1.11 trillion US dollars, 598.5 billion (54%) of which went to the US Military, be it a defense branch, contractors, or funding to defense companies such as Lockheed Martin or General Dynamics. It also includes funding to foreign military powers such as Israel or Saudi Arabia. The remainder of the spending is broken up between numerous areas, including foreign aid, education, supplements to mandatory spending, and transportation, among others. (“Military Spending in the United States”)

Mandatory spending on the other hand totaled to 2.6 trillion US dollars in 2015, broken up dramatically between many projects. Social Security and Unemployment took up roughly 50% of the Mandatory spending at 1.3 trillion US dollars. Medicare and Health spending took up roughly 33% of the spending, and the remainder was broken up between Veteran’s Benefits, Transportation, and Agriculture subsidies. Attached at the end of this document will be charts of Mandatory and Discretionary spending to allow for a visual reference of how spending was broken down in 2015. (“President’s 2015 Budget in Pictures”)

Mandatory and Discretionary spending combined totaled out to roughly 3.7 trillion US dollars rounded down. This substantial number does not include 252 billion US dollars spent on attempting to pay off interest on Federal debt. Estimated tax income for 2015 totals only 3.34 trillion US Dollars, leaving 16% of the budget to be they accrued 108 billion USD in debt, with spending expected to rise in 2016. Of even more concern is the fact that the United States accrues 537 billion USD and growing each year in interest. So in principle, the United States had a net result of an extra 353 billion USD in debt at the end of 2015. This pattern is similar to the past 50 years of budgets, with only a small handful of exceptions. (“President’s 2015 Budget in Pictures”)

How can this issue be corrected? How can we cut spending and tackle the debt? Can we prevent the eventual collapse that this path leads to? Unfortunately, there isn’t any clear answer. Some groups call for massive spending cuts, others for massive tax hikes. The unfortunate truth is that the United States is rapidly approaching the proverbial point where it can’t have its cake and eat it too. The best solution would be expansive spending cuts across all major entitlement programs, a massive cut to US military expenditures, and a solid restructuring to all government programs to reduce costs. Will we have the drive and will to make the necessary changes? Only time will tell.

The United State’s Debt Problem and The American Politician

Our National Debt problem is the result of irresponsible governing and four types of deficits. The first deficit is a leadership deficit. Presidents in current times have been incapable of dealing with the deficit. A big drawback to dealing with it is the politician’s fear of not getting reelection. Another deficit visible in our country’s governing is a savings deficit. As a country we seem to be incapable of saving money. We spend even that which we don’t have.This isn’t just an issue in D.C. though, it’s an issue in American homes as well. Thirdly, we have a trade deficit. As a whole The USA imports far more than it exports. Take China for example, they export a ton into the US, everything from electronics to clothes, and we export to them scrap metal.We are just like Rome. Lastly, we have a budget deficit as well. Politicians spend way more than we have before we have it and don’t plan where our money’s going. It just goes overboard to attempt to cover everything.

Dealing with this and fixing it is going to require consecutive, serious efforts for many years in both Congress and the Presidency. I highly doubt that’ll happen. At least, it won’t happen until we’re on the brink of absolute destitution and the politicians can no longer blow this off and are forced to take this seriously. For that to happen, the people need to take this seriously. The general public needs to learn to save again. We need to start pinching pennies again and saving for a rainy day. I believe it would benefit the US greatly if the first thing we eliminated was a leadership deficit.

In recent months we’ve seen a lot of politicians cowering behind party lines, afraid to make that one decision (raising taxes, cutting spending) that would set us on the right track. We elect cowards. People need to stop believing they can have their cake, eat it, and NOT pay for it. I get to deal with a National Debt problem that will consume my hard-earned income as I get older. I don’t want the next generation to have to deal with that. I don’t know a way that would fix the trade deficit, due to big businesses finding cheap labor in developing countries, taking jobs away from countries like the US where there are laws and codes for everything from pollution to employee health care. Self-sustainment seems impossible but there may be a way to do it, I just don’t know it. The most difficult deficit to solve in my opinion, will be the budget deficit. This would require a cooperative, willing Congress all for ACTUAL bipartisanship for anything like a budget to work. Congress will, currently, argue and fuss over everything because of parties. In future elections it would be best to elect people willing to play nice with everyone.

Impact of The National Debt on The Future

There is a very delicate balance that needs to be upheld in order to prevent the US economy from collapsing completely. The country’s massive debt is a possibly fatal factor that could offset the fragile balance and plunge the nation into chaos. We need change that will make the lives of US citizens better. I want to stop the United States economy from collapsing due to debt. Debt has been a major stressor on the United States’ economy since its beginning. The U.S. has been in debt since 1790, after the revolutionary war, and the debt has been increasing ever since.

The debt has increased through additional war, economic recession, and inflation. The national debt can be reduced through increased taxation, reduced spending, debt restructuring, monetization of the debt, or just straight up default. American citizens need to understand how debt is impacting their daily lives and how dangerous debt can be. As of 2018, the United States is 21.4 trillion dollars in debt. The United States’ immense debt puts the nation’s citizens in a constant state of financial instability. If the economy tanked, a natural disaster hit, or the political system went into turmoil, you could lose everything: your money, your assets, and possibly even your freedom.

As the federal debt increases, interest rates are projected to rise, and the federal government’s borrowing costs will increase markedly. Due to this, the government will spend more of its budget on interest costs, increasingly limiting the budget for public investments, and negatively impacting the daily lives of American citizens. Another way that debt negatively affects American citizens is by causing inflation rates to rise. Higher inflation raises prices and makes it harder to purchase basic goods and services like gas or car repair. Higher interest rates also make it difficult to afford a loan, ranging from a small amount to help launch a small business or a larger loan to buy a house. Whether it be limited public funds or difficulty purchasing daily items, the effects of national debt are never good.

If our long-term fiscal imbalance is not addressed, our future economy will be diminished, with fewer economic opportunities for individuals and families, and less fiscal flexibility to respond to future crises. Growing long-term debt also has a direct, real-world effect on the economic opportunities available to every American. CBO estimates that rising federal debt could reduce the income for a 4-person family by as much as $16,000 on average in 2047. This represents a 4.4 percent loss in income, compared to a 0 percent loss that would come from stabilizing the nation’s debt. If the nation’s debt remains unchecked, American Citizens could face many problems much greater than a 4.4 percent loss of income.

Prices would rise because the more money we borrow the higher our interest rates increase. If interest rates increase it causes the prices of daily items to also increase. As prices of goods go up, consumers demand less of it and more supply enters the market. If the price is too high, the supply will be greater than demand, and producers will be stuck with the leftover items. Consequently, as the prices of goods go down, consumers demand more of it and less supply enters the market. If prices are too high citizens would struggle just to buy food to keep their families fed. Eventually, supply and demand imbalances could cause thousands of people to lose their homes, struggle for food, and even lose hope.

When prices of everyday items increase it causes people to spend more and more of their paycheck of basic needs they need to survive. Because of this, it would become increasingly more difficult to retire at a young age or even at all. If people are losing more money than they are gaining, it causes them to lose the things they want, such as a new game system, so they can pay just to have a house. This means less and fewer people will live comfortable lives and the middle class would shrink until, eventually, it disappears entirely. If this does happen, people would either become poor or live rich and extremely comfortable lives. However, most people, even rich people, are likely to become poor. Increasing prices on basic necessities would lead to the disappearance of the middle class.

If these problems come to pass, or even start to occur, the media could easily make the situation immensely worse. The media has a tendency to blow things out of proportion and over dramatize common news. If the media broadcast news of economic collapse nationwide, people would begin panic and eventually resort to violence and crimes to feed their loved ones. Such widespread hysteria could even cause chaotic riots and unruly protests, which could result in thousands of lives lost. The national debt issues are large enough on their own, the media would only heighten their severity.

The consequences of increasing national debt are grave; however, there are several ways to make sure this is avoided. First of all, unnecessary and wasteful spending can be reduced at the Pentagon, which now consumes over half of our discretionary budget. Much of the extensive spending at the Pentagon is devoted to providing money to Cold War weapons programs to fight the Soviet Union, which no longer exists. Lawrence Korb, a prominent Assistant Secretary of Defense serving Ronald Reagan, estimates that “we could achieve savings of around $100 billion a year at the Pentagon while still ensuring that the United States has the strongest and most powerful military in the world.” By reducing spending on the Pentagon, the nation would save a significant amount of money that would certainly help pay off the debt in the US and avoid a national crisis.

The national debt could also be reduced by recommending a combination of spending cuts and reforms, including an increase in the Social Security retirement age. Increasing the federal gasoline tax is another way to help. With newly employed spending cuts, the United States’ debt would diminish over time by a significant amount.

If the government establishes a progressive estate tax on inherited wealth of American citizens of more than $3.5 million, that would raise more than $300 billion over the course of 10 years. In 2010, Senator Sanders introduced the “Responsible Estate Tax Act” that would reduce the deficit in a fair way while ensuring that 99.7 percent of Americans would never pay a penny in estate taxes. Even though this tax could cause anger among the estate owners, the nation would benefit far more than they would suffer.

Eliminating the cap on taxable income is another way to produce revenue that would help pay off the national debt. Millionaires and Billionaires should pay more taxes when the rich have the ability to provide significantly more support to the nation. Also, if the nation falls into chaos and the economy collapses, it would cost these wealthy individuals far more than slightly higher taxation would. Overall, taxing income at a certain percent would benefit all citizens, even if the rich are temporarily angered by the inconvenience of even higher taxation.

The national debt is not a small insignificant problem, like most people believe, for several reasons: increasing debt will cause prices of everyday items to rise, subsequently causing the middle class to shrink, and eventually causing widespread panic among US citizens. In order to stop chaos from ensuing, money to pay off the national debt can be raised through budget cuts and increased taxation on the rich to support the nation; however, it will not be without repercussions. Ultimately, the solutions presented above (or others of similar nature) must be enacted in order to prevent the collapse of the United States’ economy.

National Debt is Everyone’s Problem

We used to compare the Philippines, for instance, to an “oriental pearl”, coveted by colonists due to its rich resource, lush nature, and industrious people. Became a “caged dove”in time of Martial Law and fighting this we earned a title of “sick man of Asia” by early 1990 in Cory Aquino Administration. Then Fidel Ramos stepped in and re-branded the country as a “rising tiger’.

But behide this prevailing analogy would be something the true with the Philippine debt. What is national debt? In what David Primo said ‘If you think about the water in the tub as the national debt, water flowing in to the tub can be thought of as the amount of money that the government has to take out in borrowing each year because it’s spending more than it’s taking in.’ If that water keeps flowing into the tub, the tub is going to overflow. And you’ve got a mess on your hands, or in the case of the national debt, you’ve got a crisis on your hands.As of January 2019, the outstanding cumulative debt of the national government stands at P7.49 trillion. Of the amount, P4.91 trillion is domestic or local debt, while P2.58 trillion is external or foreign debt. The amount does not include P487.3 billion in guaranteed debt, or contingent liabilities handled by government if a state agency fails to pay for its debts on time. Our major creditor countries are: Japan, United States of America, Netherlands and United Kingdom.In general terms, a government’s outstanding debt consists of the unpaid balance of loans and debt securities – whether domestic or external. It is best understood as a ‘running total’ of how much the country still owe. ‘Our debt, when compared to the productive capacity of the economy, is actually becoming smaller over time,’ economist JC Punongbayan said.

What can be done to pay it off? Theoretically, paying down the debt is simply a matter of spending less and collecting more in taxes. But, us will be suffer more. It can impact you in a couple of ways. Example, If this increase in the tax will in our grocery we buy, fuels, water, electricity. As the Philippine government was compelled and staggered to abandon its citizens to chronic poverty and unprecedented misery, with the number of poor Filipinos. Our primary strategy — moving towards domestic debts, also poses some dangers. The government has initiated a war against corruption but this must be treated as a beginning and further steps should be taken to stop this and the need to do so. But nothing happened. Would this actually prod politicians, capitalists, and corporations to do something? If all hell breaks loose, they’re safely tucked in their ivory towers counting money. How can they sleep at night? Makes you want to punch them in the face. Thinking our present, our future if this continues what the next generation telling us. Why don’t you do something?

How The Economic Challenges and a Constantly Rising National Debt Has Continued to Threaten Job Security

Many Americans feel threatened due to questionable job security brought on by economic issues and steadily building national debt. We have all heard the outrageous statistics of unemployment and the never ending battle of who is responsible for this in the first place. While some factors may play a major role in the reasons behind layoffs and vanishing positions, there is another factor that will change everything in the next couple decades. The increasing use and growing reliability on technology has opened up many financial opportunities for business. However, it also has resulted in the working class having to face possible job loss and permanent withdrawal of specific occupations. In this essay I will discuss the job positions that are most likely to be threatened, and what precautionary measures we can start taking in order to prevent possible struggles ahead.

Recently, I stopped at a gas station and decided to get my car washed while I was there. I was given some options of what services I wanted done. The cheaper, faster, and the most convenient option was to get the automatic wash that was done by a machine, rather than a hand wash that would have cost me double the money, time, and of course, a tip. I try my best to give my money to the local stores or ask for services from family owned businesses, but even I am guilty of using what is more convenient and less expensive. Unfortunately, the rest of the world is guilty of indulging in instant gratification as well, causing the businesses having to keep up with a largely growing demand. I do not even bother calling to put in a pizza order. I do not have to talk to a human to make an order. I can just simply use an app on my phone, which also gives me security from any misunderstandings from occurring regarding my order. Before you know it, most pizza places will feel the need of providing such services to their customers as well, leading that “phone position” to vanish. There are many positions that are at risk, as well and it is most likely due to these technologies – “mobile internet, automation of knowledge and work, Internet of things, cloud technology, advanced robotics, autonomous and nearautonomous vehicles, next-generation genomics, energy storage, 3-D printing, advanced materials, advanced oil and gas exploration and recovery, and renewable energy” (Frey, 2013, pg. 27, para. 2)

Jobs soon will start disappearing due to a machine having the same capability of doing the work of a human. Why would we let that happen? Well, it’s the growing demand of “right now “services that we are all guilty of using, and of course, money. It will cost a whole lot of less money to purchase a machine that will most likely pay for itself just within the first year, rather than paying an hourly worker year in and year out for the same performance. It makes sense, but it will also lead our society and economy to an approaching self-destruction. Frey (2013) specifies, that at the rate we are heading 2 billion jobs will disappear by 2030. That is a very scary thought, but it is not far from the truth. Just by looking at the statistics exhibited in U.S., we can draw a conclusion of what awaits for the rest of the world decades from now. According to Collins and Ryan (2007), “ The U.S. economy is down about 2 million jobs since 2001, despite a government report of 308,000 jobs added in March, 2004…the use of technology requires a shift of behaviors, and consequences. Firms need to view new technologies as a factor that “help” their employees do a better job or to do a job with greater efficiency ” (para. 6). As we can see, the use of new technology has made us dependent in away, now causing great consequences on majority of the job market. There will, of course, be growth of jobs that are responsible of building and maintaining the new technology and machinery. However, the growth of these jobs still will not outweigh the losses of occupations that have been present for decades and even centuries.

In conclusion, we are slowly destructing the future jobs for ourselves and the generations to come. It seems that more we invent and seek progress in technology, more we find it harder to use it fairly, rather than using it for every major or even simplistic task. It is not worth to appreciate “the convenience” over jobs and well being of all individuals and families in our communities. Technology, by no means is our enemy, but the stable balance needs to be met in order to preserve opportunities for all individuals in our society. Not finding this balance, may lead us to even worst economic issues than we have now – a loss of 2 billion jobs by 2030.