Debit Ceiling.

The money brought in by the treasury pays government expenses. The current gap between incomes and expenses is about 125 billion a month (CNN Money). The government borrows to cover the gap.  The massive amount being borrowed has discussions on the rise of raising the debit ceiling. The debit ceiling is the limit on the amount of debit the government is allow to issue. The government issues bonds to be repaid at a later date to cover over budget expenses. The government first started issuing bonds and setting debit ceiling to cover expenses for World War I. The ceiling has risen and fell a few times since the war. The current debit ceiling was set in May at 14.3 trillion. The federal debit is measured as a percentage of total GDP. The currents debit is almost 100%. Government officials say that if the ceiling is not raised by Aug.2 the government will not be able to cover all its expenses.  Politicians have been it talks about raising the tax for the rich to generate more income. Several republicans have objected president Obama compromise package because of several tax increases. John Kyl, the Republican whip in the senate, said” Unless the president gets off his absolute obsession with raising taxes, Republicans will not do anything that will harm our economy. Job-killing taxes will harm our economy."  Hopefully some type of agreement and fruitful plan will be issued before the August 2 deadline.

http://articles.latimes.com/2011/jul/12/nation/la-naw-0713-debt-talks-qanda

http://money.cnn.com/2011/07/14/news/economy/debt_ceiling_deadline/index.htm

http://www.guardian.co.uk/world/2011/jul/17/us-budget-ceiling-standoff-default

Goverment Bailout

Shortly after President Obama was mad president he presented a stimulus bailout plain. The bail out plan was ridiculed. Many suggested it was a waste of time and money. However, analysis of the effect of the bail out package reflects a positive outcome. Bail outs were given to major companies like JP Morgan, Goldman Sachs, and Chase. Without the bailouts evidence shows that the previously listed companies and many more major financial institutions would have collapsed. Profits have already been made from bail out money and several companies that received bailout have already begun to pay the government back.  The bail out has reflected a 102 billion dollar difference in profit that the Feds turn over to the Treasury. Profits for the government from the bailout money are made from the securities and shares it purchased to help stimulate the economy. The feds also collected 15 billion in fees related to bail out monies. Many people felt that the bail out was a wasted and tax payers would never see a return of the monies because of major bailouts given to Freddie Mac and Fannie Mae. However surprisingly, Freddie and Fannie have been successful pay back bailout money. Although the average Joe may not see the direct influence or receive direct benefits from the bailout we all are benefiting as a whole. Without the bailout, clear evidence shows we mostly would have been in The Great Depression ll.

(http://finance.fortune.cnn.com/2011/07/08/surprise-the-big-bad-bailout-is-paying-off/)

Tuition Fees increase

Economic news has been blazing with the nation wide tuition hikes that are being implemented.  It is unconstitutional for a state to run a deficit budget; so, they must make adjustments to balance budgets.  The unbalance budgets of several states have caused rash and harsh increases in the cost of education. Public Universities are being hit the worst having to pass more expenses down to students.  An example of the extreme price hikes are the tuition fee seen in the state of Arizona. Four years ago tuition at the university of Arizona was $5,037 starting this fall tuition will have had a 100% increase and will be $10,035. The cuts to education are direct effects of the recession. Since 2008, 428 million have been cut from Arizona’s education budget.   To weaken the severity of our recent recession, the government issued stimulus packages to public universities. The funding will decease for Florida this year. Florida Universities now have to somehow find funding to cover the 140 million that was received in previous years. To cover theses losses Florida State Universities have hiked tuition 15%. I feel that students that have displeasure with increasing tuition fees should take action. Decisions on state budget are made by state politicians. For students to make changes to the way the budget is divided, students have to vote and know what those politicians’ goals are. Voters have the power to decide how, when, who, and, how tax dollar are spent.

http://money.cnn.com/galleries/2011/news/economy/1106/gallery.in_state_tuition_increases/5.html

Water parks

There are two time scales in economics the short and the long run. During the long run, all things are changeable. During the short run however, the majority of things are fixed. The only thing that is easy to change in the short run is labor. Labor is the human capital that a firm hires. Companies can easily decide to cut or reduce hours as a short term solution to decreasing profits. The quantity of labor directly effects output; so, a reduction in labor will reduce output and labor expenses. During the long run, all variable expenses and some fixed expenses are changeable. Variable expenses are things like quantity of labor, miscellaneous expenses, and bonuses. Fixed expenses are things like rent expense. The only fixed expense that I can think of changeing in the long run is the cost of resources because once contracts expire you can renegotiate them. Some companies decide to temporally shut down to eliminate variable cost.  Sever local water parks practice season shut down.  Islands of adventures,  Rec center water parks, and Wet and Wild all shout down for at least four months of the year. The parks shutdown during the winter and some parts of spring and fall.  

Marginal utility

Marginal utility is measured by the benefit you receive from something. The laws of economics states to receive maximum benefit you must use all your funds to purchase things that give you utility. Utility as a unit of measurement is lofty to me because utility varies from person to person. For instance, the amount of utility I receive from a pedicure is not the same utility my best friend receives. I personally would purchase a pedicure after a stressful week; whereas, my friend would prefer to spend the same amount of money on a few drinks with friends.  Because of the wide variation, I don’t understand how someone could confidently say anything about studying or stating marginal utility of more than just one individual.

USF research

Externalities are the external cost from the producer or buyer cost that is paid or received by an outside party. Externalities can be positive or negative.  There are two types of positive externalities network and knowledge spill over externalities.  The majority of knowledge spill over comes for college and university studies that are sponsored by the government. USF a local university has mad many advances and studies that have been beneficial to society as a whole. For example, USF has and extensive oceanography program that receives funding from government. After the oil spill, several test were done by USF to attempt to determine the effect of the oil. USF is also trying to develop more accurate systems to predict where and how oil will spread. Currently, USF oceanography department is working on creating a 4-D remote sensing system that would incorporate satellite imagery to help not only determined oil directions but hurricane and incursion. The development of this product would be beneficial to society as a whole. USF has received a grant of 400,000 to investigate the damage to fish from the oil spill