3. The Early America (1620-1789) After the Discovery of America by Christopher Columbus in 1492, it took almost 1 ½ Centuries until the settlement from Europe began. Before this, England started to build up Colonies and founded new Cities in the “New Land”. Virgina is the first Colony, named after the Kings daughter. In 1619 the first slaves where brought from the Netherlands to Virginia, after they where ordered for the tobacco industry. In 1620 the so called “Pilgrims” landed in the near of Cape Cod after they emigrated from England to the Netherlands and founded “Plymouth Plantation.” On their ship, the “Mayflower” they signed a Compact which says, that Government and laws should follow from common decisions, without giving up the loyalty to the British Crown. After this new Colonies are founded in America, which is called New England by the Pilgrims.
4. Towards 1775 people in America suffer under the treatment of England. The Crown initializes new laws for duties, and disturb economy. The desire of an independent land grows, and so the Colonies turn away from their motherland and start to fight against the British regiments. They have bad equipment and almost no chances. When British troops try to rob an arm base, the Americans besiege Boston. The 2nd Continental Congress comes together and declares GEORGE WASHINGTON as supreme Commander. A peace petition to the British King is answered by him with the “Proclamation of an open Rebellion”. THOMAS JEFFERSON begins to prepare the “Declaration of Independence”, which is published first in 1776. After some battles against Britain were lost, the WAR OF INDEPENDENCE turns in the victory of Saratoga (New York). Even if the British troops won a few several times during 1778 and 1780 in the southern states, after the Americans fought them in Yorktown with the help of France, the British had to capitulate.
5. So the War was won for the Americans and King George III. had to acknowledge the peace contract. Canada was still British, and the other states were declared as the United States of America. In 1787 a Convent of Constitution comes together in Philadelphia therefore to create the first written Constitution. GEORGE WASHINGTON becomes President of the convent. On March 4th, 1789 the new system of government starts his activity with GEORGE WASHINGTON as first President of the United States. It is based on the division of powers - the congress builds the legislative and consists of the “House of Representatives” and the Senate. It has to decide about Peace and war, Military, Contracts with other States, coins, weights, duties and taxes. The President is the Executive and has to select the civil servants, and takes care of the execution of the Congress decisions. The Judicative is given by the trial Court, which watches over law and constitution. In this year also the Bill of Rights are added to the Constitution. They guarantee the basic rights, as Liberty in faith, media and assembling, of every person etc.
10. The largest and still the most important market in the world, the United States of America’s economy is driven by consumers but is troubled by high debt levels. The United States of America (US or USA) has the world’s largest economy. According to the CIA World Factbook, 2007 GDP is believed to be $13.84 trillion. This is three times the size of the next largest economy, Japan, which has a GDP of $4.4 trillion. US dominance has been eroded however by the creation of the European Union common market, which has an equivalent GDP of over $13 trillion, and by the rapid growth of the BRIC economies, in particular China, which is forecast to overtake the US in size within 30 years. In common with most developed countries, Services is the key sector of the economy. In 2007, services made up 78.5% of GDP, industry 20.5% and agriculture less than 1%. Around two-thirds of the total production of the country is driven by personal consumption. Although the US is often referred to as a free market economy, this is not entirely true, since there are government regulations protecting certain sectors, notably energy and agriculture. It can be more accurately described as a ‘consumer economy’.
11. Since the US economy is also the largest economy in the world, and the US consumer drives two thirds of the US economy, the US consumer is also a big driver of global economic activity. The forces of supply and demand directly drive the price levels of goods and services. What to produce, and how much of it is to be produced depends on the price level fixed by the interaction of supply and demand. The role of government in the US economy is crucial when it comes to decision-making regarding monetary and fiscal policies. The federal government takes all the necessary initiatives to ensure the growth and stability of the United States. The US government makes full use of economic tools such as money supply, tax rates, and credit control, among other things, to adjust the rate of economic growth. For the most part, the US Federal Government also regulates the operations of private business concerns in order to prevent monopolies
12. The government renders a number of direct services in the form of providing support for national defense, monetary aid for research and development programs, and funds for highway construction & infrastructure in general. The question of national debt is a controversial one within the US. At the start of 2008, the US federal debt stood at $9.2 trillion. This is a worrying 67% of GDP and equates to $79,000 for each American taxpayer, a number just over 117 million people. To add to the concern, American consumers are also increasingly dependent on debt and have been re-mortgaging their houses to higher loan amounts, and using the extra cash to fund high street purchases. This debt figure is the largest in the world in absolute terms, but as a percentage of GDP it is less than Japan and similar to several European countries. Most of the debt is funded by central banks and sovereign wealth funds from Asia, Europe and the Middle East.
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14. • US profit rates decline despite productivity growthThe latest calculations of labour productivity growth highlight the emergence of a deepening contradiction in the US economy, and by implication, the world economy. While productivity has sharply increased over the past five years, profit rates have declined and, in the aftermath of the high-tech and stock market bubble of the late 1990s, the economy has entered a period of “jobless growth,” if not double-dip recession.
15. • UnemploymentThe Bureau of Labor Statistics in the United States of America releases the statistics on the number of employed and unemployed on a monthly basis. Counting the number of individuals unemployed on the basis of the number of claimants of unemployment benefits is an improper measure of unemployment. This is because a number of individuals may be unemployed and yet not claiming benefits. Again, visiting each household to estimate the number of unemployed is costly both in terms of time and money.
16. • National debt and Government BorrowingDue to decades of government borrowing the US national debt is fast approaching $10,000 billion, or more than 65% of GDP. The consequence of such high levels of national debt is to increase the cost of interest payments. It also limits the potential for future tax cuts and higher government spending. High levels of government borrowing can also lead to crowding out. Where government borrowing reduces private sector spending.
17. • Current Account deficit and External DebtIn the past 2 decades US economic growth has mostly been financed by high levels of consumer spending. This consumer spending has created an increase in imports that has not been met by a corresponding increase in exports. At its peak the US current account deficit reached 7% of GDP. This current account deficit was financed by foreigners buying US securities. It means that most of the US external debt is held by Chinese, Japanese and other investors. A current account deficit has contributed to the declining dollar and remains a constraint on economic growth
18. • Housing MarketIt is estimated US house prices have fallen by 10% in the past 12 months. Although there are many different ways to measure house price statistics, most people will agree that US house prices are falling. There is a combination of oversupply and falling demand due to uncertainty about the future of the housing market. Declining house prices can be a powerful disincentive for consumer spending. As house prices fall, consumers see their wealth decline leading to lower economic growth. It is feared that falling house prices could alone tip the economy into recession.
19. • Low savings RatioThe low savings ratio is linked to the current account deficit. It is a result of consumer led growth. It is also a result of increased personal borrowing levels. It is suggested that the economic growth has been based on an unsustainable footing. It means that the American consumer is susceptible to any rise in interest rates.
20. • Rise in Commodity pricesDespite a slowdown in the US economy, we have seen a rise in cost push inflation. In particular rising prices of oil, wheat and soybeans have created problems for the US economy. It could lead to a situation of stagflation - rising prices and falling growth.
21. GDP Growth Rate. The Gross Domestic Product (GDP) in the United States expanded 2.8 percent in the fourth quarter of 2010 over the previous quarter. From 1947 until 2010 The United States' average quarterly GDP Growth was 3.30 percent reaching an historical high of 17.20 percent in March of 1950 and a record low of -10.40 percent in March of 1958
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23. SYSTEM! The United States is a market-oriented economy where private individuals and business firms make most of the decisions. The United States has a market economy in which individual producers and consumers determine the kinds of goods and services produced and the prices of those products. The most basic economic institution in market economies is the system of markets in which goods and services are bought and sold.
26. In other economic systems, some or all of the factors of production are owned communally or by the government.
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28. Pension Underfunding Many companies that have offered defined-benefit pension plans have failed to adequately fund those plans, using the money that should have been invested for other business purposes instead. The scope of the problem is considerable, especially since the burden falls on the quasi-governmental Pension Benefit Guaranty Corporation. Literally thousands of plans are underfunded The situation is looking increasingly like it will become a candidate for a Federal bailout, much like the FDIC in the 1980s during the savings and loan crisis. Public Debt The Federal government's inability to keep spending under control has led to an enormous debt burden, about a quarter of which ($1.9 trillion) has been funded by investors outside the United States. The ongoing accrual of further debt caused by deficit spending is a tax shift from current generations to future generations, especially when it's used for ongoing operational expenses rather than to finance public works projects. Politicians have a built-in incentive to spend recklessly: Many costly government programs have concentrated benefits and diffuse costs -- the people who benefit end up much better off, while the costs are spread out over a large number of taxpayers. As a result, fiscal discipline can only be imposed by contrarian behavior -- voters and politicians who are willing to give up their pork-barrel spending in the interest of the larger benefit of sound financial management.
29. Value Added Tax (VAT) The lack of a value-added tax has forced American manufacturers to compete against foreign competitors on a wholly uneven playing field. Currently over 150 nations utilize the VAT, which acts like an import tariff. Governments which utilize the VAT also redirect VAT revenue towards subsidizing exports, placing the U.S. in a comparatively most uncompetitive situation due to the fact that we do not utilize the VAT or any countervailing measures. This has had far-reaching economic implication on the American economy. The American social safety net is falling apart. Implementing a VAT a could go a long way towards replenishing the dwindling Social Security and Medicare trust funds while also providing much need revenues for health care and educational reforms and infrastructure projects. In addition, the de facto import tariff would begin to level America’s trade imbalances with the rest of the world.
30. Overbuilding in Fault Zones, Floodplains, and Coastal Areas Florida, California, and Texas are growing more than any other states. California is well-known for its earthquake susceptibility, and Florida is in a category unto itself for hurricane damage. The government expects75% of the entire country to live in coastal counties in 20 years. While coastal regions are aesthetically pleasing, they are especially at risk for major property damage due to storms and flooding. The rush to the coasts is already on, and as the nation's median age continues to rise, a larger share of the population is likely to move to warm, sunny locations. The more those populations increase, the higher land and property prices will rise, compounding the damage likely from natural disasters.
31. US Inflation Rises 1.6% in JanuaryUS Consumer Price Index for All Urban Consumers (CPI-U) increased 1.6 percent over the last 12 months to an index level of 220.223 (1982-84=100). For the month, inflation rate increased 0.4 percent in January on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported on February 17. US Trade Deficit Widens in 2010TradingEconomics.com, U.S. Census Bureau US trade deficit increased to $497.8 billion in 2010 from $374.9 billion in 2009, as imports increased more than exports. The trade deficit increased to $40.6 billion in December 2010 from $38.3 billion (revised) in November, as imports increased more than exports.
32. The huge state debt and enormous financial commitments can drive the US budget deficit to an unprecedented height of 14% of the GDP. Let us remember that Greece, which all Europe saved, had a budget deficit of only 11,5%To get out of this pit, the US authorities have either to curtail the budget expenditure or to double the taxation. Experts warn that either of these steps can cost Barack Obama his career. If we discuss international aid, the USA needs $6 trillion to be saved. It is extremely unlikely that anyone would like to help the USA solve this problem. What is much more likely, many would like to get rid of their dollars as soon as possible. People can stop trusting the US dollar any moment and then catastrophic inflation will follow In that case the USA will have to dramatically raise the rate of refunding to make it higher than the consumer’s inflation. This will unavoidably lead to economic depression, much worse than the world is experiencing today. In this situation we can only rely on reassuring forecasts of financial experts
33. Best Practices. The United States’ compliance with various treaty commitments and human rights obligations reflects only a minor part of the commitment of the United States to the protection of human rights. That commitment is established and guaranteed not by U.S. ratification of human rights treaties or membership in human rights organizations, but rather by free and fair elections, a representative government, an independent judiciary, a robust civil society, and—most important—the principles enshrined in the Constitution of the United States of America.
34. Together, the U.S. Constitution and the panoply of U.S. laws and institutions protecting human rights and fundamental freedoms represent best practices that all States and stakeholders should emulate.
35. The best practice that the United States holds out to the world is its adherence to the Constitution and the Bill of Rights—the foundational documents which enumerate fundamental civil and political rights and establish a government of limited powers.
36. School accountability standards in the US have increased a great deal in the US as a result of American legislation, in particular, the No Child Left Behind Act (NCLB) (West, 2005; Burns, 2007). This Act emphasize the improvement of academic performance of disadvantaged students, increasing teacher quality, moving limited English proficiency among students to English fluency, encouraging informed parental choice and programs, supporting safe schools, raising funding for Impact Aid and promoting freedom and accountability (United States Department of Education, 2002).
