Fiscal Policy
The status of the United States has an effect on society. The U.S. deficit, surplus, and debt affect society in many ways. One does not take the time to see the impact it has on civilization. The status of the United States has an impact on tax payers, future Social Security and Medicare users, unemployed individuals, students, exporters, importers, and most of all, the country’s Gross Domestic Product. In the following, the team will discuss how the U.S. deficit, surplus, and debt affect society, not only in the United States, but also around the world.
Tax Payers The influence of fiscal policy changes scheduled to occur at the end of 2012 can poses serious challenges for tax payers. One area where high tax payers are disagreeing is the increase in tax rates resulting part due to the 2001 and 2003 tax cuts. President Obama has asked for the reinstatement of the higher top tax rates in his budget submission to the Congress. The increase in the Medicare tax and its expansion to unearned income for high income earners under the Patient Protection and Affordable Care Act of 2010 also contributes to the increase in top tax rates. The concern over the top individual tax rates has been a focus because of the special role played by flow-through businesses like S corporations, partnerships, limited liability companies, and sole proprietorships. These businesses employ 54% of the private sector workforce and pay 44% of the federal income taxes. Higher taxes result in the significant increase in the average marginal tax rates (AMTR) on business, wage, and investment income, as well as the marginal effective tax rate (METR) on new business investment. These higher marginal tax rates result in a smaller economy, fewer jobs, less investment, and lower wages. These higher tax rates will have significant adverse economic effects in the long run like lowering output, employment investment, the capital stock, and real after tax wages when the resulting revenue is used to finance additional government spending. The higher tax rates on wages reduce work effort and labor force participation. The higher tax rates on capital gains and dividend increase the cost of capital, which discourages savings and reduces investment. If Capital investment decreases labor productivity also decreases affecting living standards in the long run (NFIB, 2010).
Future Social Security and Medicare Users The economy is worsening and the finances for Medicare and Social Security might decrease. Both these programs are getting hit twice by the long anticipated wave of retiring baby boomers and the weaker tax receipts. The Medicare hospital insurance fund for seniors is now projected to run out of money in 2024, five years earlier than last year’s estimate. The social security funds are expected to run out by 2036. Once the trust funds are done, both programs can only collect enough money in payroll taxes to pay partial benefits (Huffington Post, 2011).
Unemployed Individuals Unemployment may present a problem for of course both the individual and the economy as a whole. For an individual, psychological and financial problems can arise when this person needs a job and cannot find one. This individual’s economic hardship is alleviated somewhat by the unemployment insurance benefits. Now for the economy, the aggregate economic output is less than the potential GDP level due to loss of production from those who are unemployed. Because of this the economy suffers, if more people are unemployed, less people pay taxes, and also less people have money for spending. Spending money lifts the economy through our taxes therefore when an individual is unemployed, money is not going into the economy and even in turn as unemployment benefits are being paid, the economy loses money. (Quickmba, 2010) University of Phoenix Students The effects of a surplus and debt affect University of Phoenix students. Finding viable employment based on skills development, increase of technology that education and flexibility are vital to employment. The educations students receive make more competitiveness to other workers in the employment section. The students make a difference in the economy. The students increase employment and bring new skills to employers. If students repay their loans with interest to the government students are circulating money within the economy.
The United States Financial Reputation on an International Level The United States financial reputation is a slowdown for a chance of a worldwide depression. The Democratic blaming the Republican part for the nation’s indebtness and is rapidly becoming a mortal threat to the economic recovery. The Democratic should let the Republicans govern or not govern running a different approach. Obama’s White House cuts the budget so drastically will undo the simulative effects of the December tax and spending agreement and plunge the economy out of recession. The financial reputation is vividly riding on households and their votes. The right party either Democratic or Republican to ease the national debt cut government spending.
A Domestic Automotive Manufacturing (Exporter) The automobile demand continues to increase despite the foreign countries crisis. The manufacturing company through the port of Charleston South Carolina is the leading automotive manufacturing exporter. The 68% increase over BMV’s 2010. In 2011 over 192,000 vehicles’ exported from its South Carolina manufacturing company. The United States department of Commerce January increased to 300,000 vehicles’ for 2012 would hire 300 jobs. By 2014 manufacturing company may have a new model the BMWX4 with a possible increase to 350,000 vehicles’. The company 7.4 billion in 2011 confirms that South Carolina is the leading the United States automotive exporter.
An Italian Clothing Company (Importer) In 2010, Italy was the United States 16th largest trading partner (U.S. Department of State, Jan.). Italy’s major industries are precision machinery, motor vehicles, chemicals, pharmaceuticals, electronic goods, tourism, fashion, and clothing. An Italian clothing company would not be affected because clothing is not one of the major imports into the United States. The ten major imports into the U.S. are Medicinal, industrial machines, petroleum products, household goods, wine, footwear, jewelry, furniture, industrial engines, and stone (Workman, Aug). The only way it could affect Italy among other countries is if the U.S. clothing economy would be suffering, it would create opportunity for Italy to expand their clothing lines into the United States.
GDP
The United States economy is measured by the GDP. In 2011, the GDP was $15.3 trillion (Amadeo, 2012). GDP is not affected by the U.S. economy rather the economy is affected by the GDP. There are three reasons for this. GDP determines if the economy is growing faster or more slowly. GDP is used to compare economies throughout the world. It will compare the growth rate of the economy all over the world. GDP is looked at by investors wanting to know the growth rate of the economy.
Conclusion
The United States deficit, surplus, and debt have an effect on society, from the individual, to the world as a whole. Higher tax rates result in a smaller economy, fewer jobs, less investment, and lower wages. Social Security and Medicare is decreasing causing a strain on the U.S. The more people the U.S. has unemployed, the less people paying taxes, and the less people having money to spend. Even students suffer because of the high price in tuition. The United States financial reputation is a strike for a chance of a worldwide depression. The automobile demand continues to increase despite the foreign countries crisis. Exporting is still not much of an issue. Importing is also not affected by much because of the demand for low cost products in the market. The GDP is not affected by the U.S. economy but the economy is completely affected by the GDP because the GDP is the foundation of investors worldwide.

References
Amadeo, K. (2012). US Economy. Retrieved from http://useconomy.about.com/od/grossdomesticproduct/p/GDP.htm
Huffington Post. (2011). Security and Medicare. Retrieved from http://www.huffingtonpost.com/2011/05/13/social-security-medicare-_n_861647.html
U.S. Department of State. (Jan. 28, 2012). Background Notes: Italy. Retrieved from http://www.state.gov/r/pa/ei/bgn/4033.htm
Workman, D. (Aug 24, 2007). Top Italian Exports & Imports. Retrieved from http://suite101.com/article/top-italian-exports-imports-a29550
Quickmba. (2010) Retrieved from http://www.quickmba.com/econ/macro/unemployment.
NFIB. (2010). Retrieved from http://www.nfib.com/LinkClick.aspx?fileticket=OMV7uZczVaM.
NY, O. (2011, January 6). The GOP Is Holding the Economy Hostage, and It's Time to Call Their Bluff. NY Observer.
BMW Manufacturing's 2011 export value surges past $7 billion. (2012). South Carolina Business, 33(3), 4.
PR, N. (2012, March 1). BMW Manufacturing's 2011 Export Value Surges Past $7 Billion. PR Newswire US.