Financial Crisis

AS THE WORLD CONTINUES TO MOVE FORWARD INTO THE FUTURE, THE U.S ECONOMY CONTINUES TO SPIRAL OUT OF CONTROL. READ THIS ESSAY AND BE INFORMED.

Abstract

While wages remain flat, the cost of basic living is increasing. In the past five (5) years the cost of in state college tuition has grown thirty-five (35) percent, health care costs have risen five times faster than wages, and personal savings rates have reached an all time low. It is all but too easy to see that the Unites States economy is in danger. The resolution of this crisis will require cooperation between members of the executive branch and legislative branch; also, it will require explorations of fairness. Even though the problems of the economy may seem insurmountable, the task of turning the economy around isn’t impossible. The purpose of this paper is to show what needs to be done to resurrect our dying economy, and I hope after reading this paper you will have a clearer understanding about the problems our economy faces.


Statement of Problem

As we make our journey further in the new millennium the United States economy, continues to show more signs of weakness. The dictionary defines economy as the management and cooperation of resources in a community, country, ECT.., it is also the prosperity or earnings of a place. This definition of the word “economy” makes the subject easier to grasp. Because of the definition above we can assume three (3) things. One (1) that a strong economy has a nice amount of resources and manages them well, two (2) that a strong economy is financially secured, and three (3) that the government cooperates with one another. For an economy to be recognized as a “strong economy” it must posses all three of these characteristics, and as time passes the U.S begins to lack these essential economic requirements. Lacking resources, the United States have driven oil prices to new heights, far beyond comparison. Being financially unstable and equipped with an uncooperative government has left America with a nine trillion (9,000,000,000,000) dollar debt, and a weak national government. The economic crisis is self evident that the United States lacks resources, money, and government to prevent another depression.


Theory

The United States government is divided into three (3) different branches, The Judicial branch, the Legislative branch, and the Executive branch. The legislative branch has the power to amend and create laws, the judicial branch has the power to interpret the law, and the Executive branch enforces the laws. In the readings of John Rawls justice is based on the ideals of fairness. Webster defines Justice as the moral principle determining just conduct, while fairness is defined as legitimate or free from dishonesty or injustices. The words similar, yet different, explain Rawls case in not only in their definitions but throughout history. Axelrod and Hamilton, on the other hand, believed that cooperation was closely tied with the theory of evolution. The main ideal of Axelrod and Hamilton was that evolution without cooperation was impossible, and that can be seen even today.


Analysis
Three (3) men have come up with different ideas about the way the economy should be handled. The first two (2) gentlemen, Robert Axelrod and William Hamilton, believed in the evolution of cooperation. The basic concept of this idea was that cooperation was the key to evolution and the devolvement of life. They believed that without evolution the advancement of our people would be haulted. Their idea was backed with different types of strategies such as Prisoner’s dilemma and A Tit for Tat which offered different methods to becoming successful.
Cooperation is usually analyzed in game theory be means of a non zero sum game known as “Prisoner’s Dilemma”. In this idea by Axelrod Subject “A” or subject “B” can choose between two (2) moves either “cooperate” or “defect”. The idea is if both players choose to cooperate both will gain, but if subject “A” cooperates while subject “B” defects, subject “A” will receive little while subject “B” gains more. If both defect however, both subject “A” and subject “B” will receive very little or nothing at all.
The problem with Prisoners Dilemma is that if both decision makers were purely rational, they would never cooperate, and we find this true in our government today. The balance of power is distributed in such a way that won’t allow one (1) branch of government to pass a law without the others consent. Because of the lack of cooperation between our branches of government, laws to improve the economy are constantly overridden. This situation not only furthers but proves Axelrod’s idea of evolution and cooperation. As we press on into the future the economy of America continues to breakdown, and the idea of no cooperation leading to the devolvement of life is now beginning to show face. It is has been proven that a weak economy virtually leads to the destruction of a country and its government, and without cooperation between the branches of government it is only a matter of time before America’s government collapses.
A Tit for Tat is another basic yet effective game strategy offered by Axelrod and Hamilton. A Tit for Tat is a basic strategy where subject “A” makes a series of moves and subject “B” follows behind making a series of moves identical to those of subject “A”. By following this plan subject “A” and “B” eventually conclude at a stalemate, due to subject “B’s” neutralizing maneuvers toward subject “A”. Although it results in a stalemate where both players virtually receive the same outcome, it also can be avoided by detecting this strategy early.
This strategy also is seen working throughout the economy. When problems arise in the economy the government often time uses the Tit for Tat strategy, which solves the short term problem, but usually neglects the serious issues further down the road. Due to the tremendous debt accumulated by the United States over time the government has often tried to solve this problem by creating more money. By doing this the government will receive their extra money, but as more money is being placed in the economy the nation as a result begins to undergo inflation, causing a problem even greater than the original one.
The next gentlemen John Rawls believed in the idea of fairness and justice. Webster defines Justice as the moral principle determining just conduct, while fairness is defined as legitimate or free from dishonesty or injustices. The words similar, yet different, can be found within the definition of the other. Rawls believed that without fairness you had no justice and without justice you are left with a weak government.
Views from both parties can be used to solve problems in the economy today. As Rawls said justice is based on the ideals of fairness, and to solve the problems of the economy they must be just in all their dealings which will make the economy fair for everyone. Axelrod and Hamilton’s theory would tremendously help the economy. The idea of cooperation is one that has been proven throughout time. If the government would come together on an issue and play their own individual role to help out for the greater good, the economy would recover quickly.


Conclusion

So in conclusion, the economy of America is in critical condition, but can be changed with a little time and thoughtful planning. The economy in the government will come together only if cooperation and fairness is involved in the different branches of government. As we head into the new millennium we can survive only if the economy stays intact, and that will happen only through cooperation and fairness.