1. There are two ways: by reducing the present value of the scheduled benefits or by increasing the value of the scheduled taxes. There are many pros and cons in doing such ways. First, in reducing benefits, there will be some cost trimmers like adjusting the COLA, increasing normal retirement age to 70, index benefits to prices not wages. In these several pros and cons can be observed. In adjusting the COLA, the government can save money but this would result to decreased standard of living. In increasing normal retirement age to 70, retirement will be close to life expectancy increasing worker health but this would incur less benefits.
In index benefits to prices, this could eliminate the shortfall but reduces the growth in scheduled benefits as time pass by. Increasing the taxes would include raising the cap to 90% of taxable earnings, payroll tax rate increase; increase taxes on benefits, taxes on estates is preserved to 3. 5 million, extension of coverage of to newly hired state and local government employees and investing a portion of trust funds to indexed funds. Some pros and cons can be observed like raising the cap to 90% will affect only 6% of the taxpayers but it will only affect high earners.
A gradual increase in the payroll taxes would maintain a 75-year solvency but it will badly affect workers. Preserve taxes on estates will improve tax progress but would alter president’s tax-cutting plans. Extending the coverage of social services will make the social security universal but the state and local government employees will get less retirement benefits. Investing a portion of the trust fund will make high returns on investment but it can also incur a negative return since it is a risk.
The people who are taxed with social security will be the one who are affected by the current social security system whether it is winning or losing. Some issues include the privatization of the social security to solve the financial problems. We do have an obligation whether it is moral or economic obligation because we are the ones who are benefited by the social security. We are part of the government thus we should also be part of the solution to the problems. 2. There are some system inefficiencies and inequities with regard to U. S. healthcare system.
This includes delays in seeking care and increased use of emergency care, there is a shred cost for the uninsured, there are variations in provider practices, poorly coordinated care, some administrative costs, the coverage gaps, mental health parity, medical underwritings, and health disparities among people of color. It is an obligation of the government to its people that is why they should provide national health care. There are some issues involve with Medicare like the quality of beneficiary services, hospital accreditation, and physician residency.
There are many ways to revise and finance Medicare, one way is to deduct taxes into salaries of people but it will affect workers. And making increase benefits with using the Medicare. Medicare expansion is not needed the benefits are the ones to be reformed. The government should regulate prescription drugs cost by creating non-profit prescription drug manufacturers if this can’t be done, the congress should pass a bill reducing the cost of these prescription drug. 3. Trade is an important part of an economy. If the U. S. government will not encourage world trade then the first thing that it will affect is its economy.
Absolute advantage means that a country has the ability to produce a particular good with lesser resources than another country. On the other hand comparative advantage means that a country can produce a particular good at a less opportunity cost than that of another country. U. S in general, both has absolute and comparative over most of the countries in the world. That is why it should engage itself to world trade. China is one of the major trading partners of US. One issue between the china-US trades is the health and safety of some imports of US from China.
Certainly, US should be the biggest winner of the world trade because it has many open markets and investments compared to other countries in the whole world. But today, US market is in recession and also other foreign markets. There are no real winners but many losers. 4. Tariffs and quotas are imposed by the domestic country in order to keep the domestic price of a foreign product above market levels. This means that the domestic country will increase profits at the same time it decreases imports which can affect the sales of domestic products.
The quantity of imports is decreased because of the tariffs and quotas therefore increasing the importing price and decreasing the demand for foreign cars because of its higher price compared to domestic cars. The domestic demand will increase because of its lower price compared to foreign products. The US government should not bailout or subsidizes the car industry because it is not the government’s duty. It is the car companies’ duty to improve its products competitiveness to other foreign products at the same time it should make it affordable so that it will be lower in price even with tariffs and quotas are put in it.