Threats to Prosperity and Stability of Developed Countries

Threats to Prosperity and Stability of Developed Countries Adrian Ma Over the past few decades many developed countries have taken the wrong steps to maintain peace with foreign states and have substantially increased the size of their government. Consequently, it becomes detrimental to any countries’ prosperity and stability; economic freedom is proportionate to size of government and war always affects the civil and moral progression of a society. When a government ignores the notion that â€Å"the individual† is the basic unit of social analysis, then the citizens cannot live life to their fullest potential. The problem perpetuates as more and more youth are becoming liberal because they are also becoming more liberal than the previous generation. The ongoing growing concept of liberalism is determining a lot of age groups to openly seek out help from the government and this strips away the dignity of each individual entailing rights and responsibility. According to an article, the average annual income per household in 2007 was appro ximately 53,000 and in 2013 it dropped to 48,000(Economist’s). The percentage of extra income the average person makes also made a noticeable drop from 5 to 4 percent meaning that it would take 5 extra years for them to double their income. This is an indicator that societies’ focus has transitioned from setting goals and seeking out to excel in certain areas to getting paid to support their financial situations, simply because of the expectation that the government is going to solve their problems. Individuals are the root of any prospering and stable economy, not the government. One top of government programs killing individualism, they also destroy millions of jobs. If citizens are constantly required to pay more and more taxes every year for government programs, not only will their financial situations get worse but competition will drastically decline as well. At the time government wasn’t involved in healthcare, it was cheap because private sectors fought to keep their businesses alive by competing with others and that factored in by lowering prices. All of these amazing â€Å"benefits† that the government forces insurance companies to provide us must be paid for by somebody and it’s those of us who aren’t in any allocations, work for the government, or have lobbyists to get us exemptions. Let’s look at Obamacare; there are so many faults because it tries to make every person happy. It centralizes on ensuring that people are covered rather than addressing the cost of care in the first place. It doesn’t benefit th e youth because they tend to be healthier and they don’t need as much coverage as the older age groups. It also increases the cost of everyone’s insurances because insurance companies are required to cover sick individuals. Healthcare in 2002 for a family of 4 cost approximately 9,235 dollars per year and after the government got involved it rose to a staggering $20,728 in 2012 (Milliman Medical Index). Another problem with government expansion is that it causes inflation; the increased debt ceiling from overspending and the Federal Reserve is just a cataclysmic combination for stability. Here’s the dilemma, whenever the government needs money instead of issuing their own notes backed back their own credit they issue treasury bonds, then they sell these bonds to the Federal Reserve which buys them with money they created out of thin air. The money that the Federal Reserve creates later goes to the government meaning it has to pay interest on the money the Federal Reserve lends to the treasury. This means that there will never be enough money in circulation to pay off the debt. The liquidation of debt is what makes an economy prosper and stabilize. Looking back at how the depression ended, a number of people believed the gold standard was the gold standard but they were mistaken, the countries that were able to liquidate their debt first got out of it. After World War 2, the g overnment cut 60% of the budget, 30% on tax rates, and around 9 million military personnel came home causing all the bad debt to be liquidated, hence, ending the depression. The constant printing of money may have bailed out major corporations during the depression but the problem originated from a governments belief that they can run the economy. The price stability reduces and a side function of an unstable dollar is the large swing in consumer prices. Another issue that developed countries overlook is the importance of economic freedom, it is more than just the freedom to buy and sell products and services. It allows us to be free in our interactions with other people. It also empowers people to travel, to say what they want to say, and to do what they want to do. It is about being free to make our own choices. A lot of those things are positive indicators of a healthy country and for a government to interfere may form impairment. Based on facts, the more economic freedom country has indicates that everyone is better off. The economic freedom of North America Index indicate that states with more economic freedom have higher growth rates of the economy, 4.6% GDP in the 25 least free states and 5.5% in the 25 most free states; lower unemployment rates, 5.5% in the 25 least free labor markets and 4.9% in the most free labor markets; less debt per GDP than states that are less free, 16.2% in the 25 states with least tax freedom and 15 .7% in the 25 states with the most tax freedom (2000-2009, LearnLiberty). All of these things people associate with economy health are also associated with economic freedom, and the same phenomenon also occurs with the countries of the world. The most economically free countries have GDP’s per capita that are about 10 times the size of less economically free countries. Some of the counter arguments I’ve encountered is that the GDP per capita only measures average income but it is untrue. It’s possible to have a country with a small number of elite rich people and a large number of destitute people, and if people examine inequality measures what they should see is that the countries that are more economically free also have more equitable income distributions. Economic freedom is not only associated with higher income levels on average but it is also associated with more equitable income distribution. Skeptics have argued that economic freedom achieves economic i ncome because of exploitation, people and the environment. Based on the data, they are wrong. On average women in more economically free countries have more gender equality and child rates tend to be a lot lower. Some may say that child labor rates are lower in economically free countries because they are more prosperous and can import from but they are also mistaken. The same phenomenon occurs even amongst the poorest countries; the least free poor nations have 40% child labor rates and the freest poor nations have 37% child labor rates (2000-2009). The biggest threat to the prosperity and stability of any developed country is war and the longer it is the more it will cost. An administrator in the Bush Administration told American taxpayers in a hearing before the Iraq War that it would only cost 1.7 billion dollars. According to numerous sources, the wars in Afghanistan and Iraq will now cost taxpayers roughly 5 trillion dollars, and that isn’t even taking into account the long-term medical care and disability compensation for service members, veterans and families; military replenishment and social and economic costs; expensive repairs to a force depleted by just perpetual fighting. More problems arise with government healthcare because the government owes it to them for fighting their wars. In the United States alone, a quarter of a million troops have suffered traumatic brain injuries (TBI) putting a bigger toll on the government healthcare system. Even the war on drugs also threatens the stability and prosperity of a country but that’s another issue. Governments should learn to take care of their own people before trying to solve other people’s problems. Our ability to cooperate, to help each other out develops when there is no conflict and when individuals have a smaller reliance on government. They recognize themselves in each other and are programmed for compassion. All of those things make them stronger, faster, and smarter. It relates to why communism doesn’t work as well as it should because human beings are biologically engineered to be competitive in nature and freedom drives then to work harder for success. If a government takes away our rewards and shares it with others then a specific majority will feel less rewarded, thus, competition and innovation is automatically promoted by limiting the government’s role in an economy. In a free economy, people will constantly find ways to create and offer better values to customers than their rival firms. Competitors that do well focus on reality, inventions, innovations, and methods opposed to rivals per se. Citizens are given more of an inclination to be independent, unconventional, and rebellious towards societies’ opinions and norms. It is no wonder why most of the greatest discoveries came from the countries that are the most free. Works Cited Dominguez, J. (1995). The Caribbean in a new international context: Are freedom and peace a  threat to its prosperity? New Dynamics in Trade and Political Economy. Miami: North-South Center, University of Miami, 1-23. Picciotto, R., Weaving, R. (Eds.). (2013).Security and development: investing in peace and   prosperity. Routledge. Meltzer, A. H. (2010).A History of the Federal Reserve, Volume 2. University of Chicago Press. Berger, A. N., Hannan, T. H. (1988).The price-concentration relationship in banking(No. 23). Board of Governors of the Federal Reserve System (US). Dincecco, M. (2009). Fiscal centralization, limited government, and public revenues in  Europe, 1650–1913.The Journal of Economic History,69(01), 48-103. Paul, R. 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