By Prachi Saxena
Ask an economist about the best economies of the world and the conversation can not end without the chronicle description of the U.S economy.
Often, Indian economy is compared with that of the U.S and condemned.
But do you think U.S has an ‘IDEAL’ economy and all the worldly appreciation is worth it?
Well, if your answer is an emphatic yes, then its high time to wake up.
True that its performance needs to be lauded for the major reasons like the dollar being the accepted currency worldwide and the massive GDP along with a stable government which attracts foreign investment, creates job and wealth in the economy.
However, the underlying fact is that the Americans are not happy with the direction of the economy. And the reasons are substantial.
Firstly, prices of gas and consumer goods are towering. In President George H.W. Bush’s first term, gas prices increased from $0.92 to $1.12 over 4 years. Over the next 8 years, it increased to just $1.42. Under George W. Bush, prices settled to $1.79 after his 2 terms. But, under Obama, gas prices sky-rocketed beyond $3 mark.
Secondly, joblessness and underemployment was pervasive especially from 2009 to 2013. In all, there were more than 2 million fewer people working at the start of 2013 than were at the start of 2009.
Plus, the regulatory policy puts the U.S at a disadvantage. The U.S has become less competitive internationally. In a newly issued report by the Fraser Institute, the U.S dropped to 18th most ‘economically free’ from a peak of 2nd in the world in 2000.
On being compared with OECD countries, only one OECD country ranked superior to the U.S in terms of ‘business freedom’ in 2005. However, the number has dropped to 8th in 2011. In 2005, only 2 OECD countries were ranked as having better protection of property rights. By 2011, 14 of the 17 other OECD countries were rated as superior to the U.S.
The extent of its advantage has been shrinking over the past years.
And yes, not to loose sight of the recent Sub-prime Mortgage Crisis that caused panic and financial turmoil around the world.
Therefore, comparisons will do no good.
Its important to accept that the U.S economy performs apparently better than Indian economy but more important is to know the reasons behind it.
To rehash, our present requires a concrete change- a change in policies, a change in perspective and most importantly a change from within.
Here are some very lucid steps through which we can lead our economy to an idiosyncratic path of development.
- Save electricity and water. Scarcity will reduce and so will your bill payment.
- Go for car pooling or public transport or walk if possible. This will reduce oil imports which alone stands at 66% of total imports in india.
- Switch to Indian products and brands over foreign. I am not asking you to buy Micromax over Samsung Galaxy, but wherever possible try buying Indian manufactured goods.
- Please don’t buy gold unless necessary. Gold forms around 26% of total imports, second highest after oil. If you are buying it for celebration purposes, its okay but don’t buy for just investment purposes. want to know why? Because when you buy gold – India imports more gold→more dollars spent on import→more current account deficit→rupee depreciation.
- Producers must avoid stocking their products for price hike. This will reduce inflation.
- Think before you plan your family. Population is the biggest curse on our economy. If you planning to go for 2 children, think why not only one? If you planning for one, try if you can adopt some child. It will help making someone’s life and economy is benefited as an incentive.
Remember, goods have bads and bads have goods. Economy exists because of our never ending needs. If we don’t cooperate and contribute our bit for healthy economy, who gave us the right to question about inflation?