The economic problem I have chosen in the form of the enormous public debt belongs to the positive branch of the modern economy. The main difference between positive and normative economics lies in the approach to considering processes. The first standard is characterized by objectivity and conformity to clear facts based on measurable parameters (Fontinelle, 2021). This branch of economics deals with analyzing and describing any data to establish cause-and-effect relationships. Normative economics, in turn, is closely related to issuing a subjective assessment of events and actions based on ideology or opinion (Fontinelle, 2021). This standard describes what should be instead of what is now, prescribing a particular course of action. The problem I have chosen is a factual observation devoid of any emotional connotation and represents an existing objective tendency to spend more money than is available in the country. Therefore, this question belongs to the economy’s positive and not the normative part.
Thank you for highlighting this extremely critical problem for national and global economies. From my point of view, Russia’s invasion of Ukraine is a significant financial problem. Russia is an important participant in the international market, especially in the field of natural resources. Sanctions against it will hit all consumers of Russian gas, oil, and other products. This is especially evident in US gasoline prices, which have risen to an average price of $4.33 per gallon (Cassidy, 2022). Moreover, the war in Ukraine lasted only three weeks, and the most severe sanctions packages were introduced relatively recently. Therefore, more price increases can be expected, which makes this problem the most acute for modern America and its future.
Unfortunately, I have to disagree with your position regarding the unemployment rate in the modern American economy. Undoubtedly, the consequences of unemployment you describe are realistic and can indeed exist. However, I want to note that you did not make a single citation confirming your words in your post. Also, the reference source you provided doesn’t say anything about unemployment specifically in the US and only provides general information on the subject. However, official data show that the country’s current unemployment rate is 4 percent, down 2.4 percent from January 2021 (Barnes, 2022). Based on these figures, I cannot recognize the current unemployment rate as a serious and fundamental problem for America since the situation in this area is systematically improving.
References
Barnes, Z. (2022). State unemployment rates | January 2022. National Conference of State Legislatures. Web.
Cassidy, J. (2022). How big a threat to the U.S. economy is the war in Ukraine?The New Yorker. Web.
Fontinelle, A. (2021). Positive vs. normative economics: What’s the difference? Investopedia. Web.