Energy and politics

USA is one of the highest energy consumers in the world therefore making it possible to support the massive production system in the country. Availability of energy acts as the driving force for all the countries in the world (Organization for Economic Co-operation, 2006). Petroleum and coal have been the key energy sources used in the world and at times surmounted to international wars. USA has however developed nuclear energy that has highly boosted the production in the country boosting it’s products output at any particular time.

High dependence on petroleum on the other has highly contributed to the USA economic recession experienced in the last years (Liebig 2004). War in Iraq which is one of the highest producers of petroleum led to reduced supply into the market therefore increasing the prices of the remaining supply. This was severe to the level of the government offering economic stimulus to the producers for them to overcome the recession Energy efficiency in USA has been high compared to other countries therefore indicating high returns from the energy source.

Efficiency assist in reducing the cost of production by utilizing all the available energy to completion. Fiscal policy expansion for political reasons has continued to increase and therefore running tighter money policies. The world events are bound to have even higher effects on the local economy as they will easily become intertwined. USA has had GNP developing upward in the last few years due to consumer and investor confidence in the country.

As indicated earlier, the US government do not interfere with the investors therefore winning their investment into the state and helping in maintaining GNP and services enough for domestic consumption as well as international export (Thomson & Peris, 2005). Comparing President Clinton and president bush administrations, the economy has slowed down with higher rate of unemployment due to the extended spending and reduced emphasis on production in the local capacity (Moulton, 2000).

GNP level having reduced and being predicted to remain at the same level or slightly grow in the next few years, a great shift must be established to increase the production in the country. Enough economic stimulus must be added for the state to regain it’s Disasters and war effects Over the last few years, USA has undergone several calamities that have contributed greatly in the present status of the GNP. Devastating Hurricanes like Ike, Gustav and the dangerous Katrina caused a lot of destruction and prompted the government to shift more resources to reduce their impacts to its people in the affected areas.

These devastating phenomenons have been destroyed major production units reducing the amount of goods and services produced for consumption and export to other countries by the state (Michael, 2008). Terrorist attack in 1998, subsequent war against terror in Afghanistan and the recent war and occupation of soldiers in Iraq also shifted large quantities of resources to military department which could have been used in production and raising the GNP.

GNP deterioration was accelerated by the fact that these factors happened simultaneously and therefore impounding their combined effects to the country at the same time making the effects to be felt more. Future of the GNP. With analysts predicted slow growth and continued unemployment status in the country, the country must increase its efforts to address different factors that led to the current situation. Rising medical as well as other costs for the aging population who are less productive may reduce substantial amount of resources to serve them.

Income stagnation for the family at the lower levels economic groups and relative large budget and trade deficits threaten to reduce the overall ability to raise the GNP. They must be addressed with improved policies to induce higher rate of growth for the state (Organization for Economic Co-operation, 2006). Investment in economic infrastructure must be raised to reduce the volatility of the international investors in the country. Long term infrastructural establishments acts as the security to employment for the young people in a country therefore raising the levels of production from the state (Liebig 2004).

Conclusion. GNP in USA has been the correct indicator in terms of precision for the status and the externalities that affect it at different times of the year. The current reduced growth in GNP as discussed above, calls for increased input into the economy to raise the current growth to higher standards. The state’s foreign policies, especially those relating to it’s spending must be reviewed with the aim of cutting down the quantity of resources used by the state at the expense of local GNP.

Use of nuclear energy and renewable sources must be embarked on for the unexpected impacts realized during the low supply of the petroleum products to be avoided in future. The government disaster preparedness systems must be increased to reduce the negative impacts of these events whenever they happen and therefore sustain the GNP without major fluctuations whenever these events occur (Thomson & Peris, 2005). To add to that, all the factors affecting the national income must be addressed with the political stability of the US government being maintained. Recommendations.

The government should expand the the delineation for the GNP to reflect the factors that affect the quality of life in order for it to be fully representative of the state’s situation at any particular moment (Michael, 2008). Also the US government should be more involved in the market determination for various products and services in order to fetch higher prices therefore guaranteeing higher GNP for the state. Finally, the government should avoid over estimation and underestimation in order to give the correct estimates of the GNP required for the state progress.

References

Liebig, F. (2004). Economists hand book: Comparison of GNP and GNP. Washington. Prentice publishers. Moulton, B. (2000). Getting the 21st-Century GNP Right: What’s Underway? American Economics Review (90)2, 253-258. Organization for Economic Co-operation. (2006). US Economic survey report 2004-2007. Washington: Danson and Williams. Michael, P. (2008). The status of the US economy in the current world. American Economic Review. (107)32, 54-65. Thomson, T. & Peris, M. (2005). Unites States Economic Status: GNP and GDP. New York. Sage.