Austerity plans have been implemented by some European nations recently, in order to avoid the possibility of defaulting on national debts and to maintain their credibility in the financial market. The Austerity Contingency Plan would prepare cuts on government growth, national debt and entitlements. We have still time to implement the Austerity plan, but doing earlier can help to preserve our trustworthiness in the financial markets and to limit the cost of interest payments. Jobenomics, an informative book authored by Chuck Vollmer provides an outline of critical areas to be included in the Austerity plan. You can get a lot of useful information by reading this book. To get your copy, visit www.jobenomics.com,
The federal, state and local government workforce has grown from16.2 million in 1979 to an estimated 24.2 million in 2018. The White House budget documents (2009) specify that there were 4.4 million federal employees, who received an annual compensation and benefits amounting to $422B. This means that an employee received $97,580. If you subtract the benefits, the federal employee gets $71,000 in a year, whereas a private sector employee gets only $40,000.
96 million people are working in the private sector in our country and 35 million people are working for the government. Government civilians, postal workers, military forces and government contractors are included in this. The 1 to 3 ratio is extremely weak in an environment, where the workforce in the private sector is decreasing.
The Austerity Contingency Plan would help to balance the size the costs of government and private sector workforce. Already some state and municipal government officials are implementing the austerity programs, as the revenues are decreasing to a great extent. The federal government gave bailouts amounting to $140B through the American Recovery and Reinvestment Act of 2009 to the states and municipalities. If it had not given bailouts, the states and municipalities would have reduced their workforce and services significantly more. However, it is important to understand that the federal government cannot continue to give such large amounts of bailouts in today’s high debt environment.
The Austerity Contingency Plan would take the impacts from weakening states and financial crises into account. In California, the Gross Domestic Product is nearly $1.8T. This amount is equal to the amount of combined GDPs of Greece and Spain. Many European countries fear that the economic crisis in Spain and Greece would cause the demise of entire economy in Europe. California’s budget crisis may also have the same effect over the entire nation. The State had a shortfall of $60B in budget in the year 2009. It was forced to reduce state services by 25%. The Government of the state specified that his budget called for great reductions in almost all aspects of state government.
The federal government would find it difficult to provide financial assistance to the state at some point in the future. The Austerity plan would prepare for the outcome of insolvency of many states and municipalities.
Jobenomics points out the ways to get out of economic crisis. You can gain a clear understanding of our economic situation by reading this book. Get your copy by logging on to www.jobenomics.com