The US economy has important effects around the world. “The US has the world’s single largest economy accounting for almost a quarter of global GDP, and one-fifth of global FDI, and more than a third of stock market capitalization” according to VOX. With that being said, the global economy is very important to the US. According to Forbes, during the first term of the Reagan administration, America’s economic role in the world increased, rising to a 34% of global GDP by 1985. After this, the GDP hit a decline and didn’t improve until President Clinton’s second term. After Clinton left office, however, the GDP went down.
Today, The US only contributes 22% of the world’s economic output according to Forbes. In the future, we need to improve our economy, encourage American citizens to start new companies and attract companies that are founded in another country. Most importantly, we should make it more appealing to other businesses to expand into America. The US isn’t the only country trying to contribute to the global economy, change their economic system, or plan for the future and their involvement in the global economy. Monica Araya was a speaker at a TEDSummit. She talked about how she came from Costa Rica and why they as a country want to get rid of fossil fuels. This eventually would help contribute to the global economy.
Not only did they stop using fossil fuels, but they don’t have an army. The fact that they didn’t have an army helped with the possibility to reboot their country after they got out of a Civil War because they didn’t have to spend money on an army. Monica stated, “ By abolishing the army, we were able to turn military spending into a social spending.” Monica went on to say that Costa Rica decided to spend their money on free education and free healthcare. The fact that Costa Rica does not have an army greatly helps their economic system.
They are able to spend money other places that may not cause them as much money, or end up putting them in debt like an army would if there happened to be a war. Monica stated later in the TED Talk that by the time the next election comes, Costa Rica would like to abolish fossil fuels. Costa Ricans want to show that development of renewable energy is good for the people, for Costa Ricans who are alive and for those who haven’t been born.
Not only do countries need to contribute to the global economy, they need to attack the challenges of growth and participation in the global economy. Olivier Scalabre stated that the change to help fight the challenges of growth and participation in the global economy is going to come from manufacturing. Scalabre claims that it will get us out of a growth slump, and change the way globalization has been shaped over the last decade.
Manufacturing has made many attempts to try and break through. Unfortunately, none of these attempts have been big enough to get them growing once again. Scalabre then stated that we are not growing because we have failed at reinventing the manufacturing space. What we need to do to help growth in the economy is to have major technologies endter the manufacturing space. This will then help boost productivity, which will boost growth. Scalabre says that China will inject more growth in our economics that the top five European markets together. In the end, if countries play their cards right, we should see growth in all economies.
With all this being said, I have a prediction of what the global economy will look like in 25 years. One thing that I believe will happen in the next 25 years is that we will get to globalization. I think that we will start to learn from other countries ( like India who does a lot with globalization) and start to flourish as a country. I think that we will start to be smarter with education, money, armies, energy, increase manufacturing, trade ect. That is what I hope to see in 25 years. I want our country to learn from other countries failures and accomplishments.