Реферат: US And The World Economy Essay Research

key industries. From 1930 through the sixties the economy was booming. There

were low inflation rates that averaged 3.8 percent over that period of thirty

years. The interest rates were also low at two percent over a period of three

months. Bank failures were virtually non-existent, oil and gas supplies were

readily available. The price of gas even had a slight decline in the sixties. As

the sixties came to an end the growth had stopped and problems in the economy

started to occur once again. The budget deficits in 1968 went from eight billion

dollars to twenty five billion dollars, and continued to rise as it exceeded

over 200 billion dollars by 1983. The growth in labor productivity from 1948 to

1968 was about 3.3 percent and from 1968 to 1983 declined to as low as 1.2

percent. In 1974 the banking failure rate had skyrocketed from past success. The

Airlines were losing money even though they kept on increasing the price of

fares; also the nations largest railroad companies were facing possible

bankruptcy. The reason for the downturn in the economy was due to the control,

which the government had over these corporations by enforcing these regulations.

The problem with these regulations was that it caused higher than necessary

costs, distorted the patterns of supply and demand. The rate of return

regulations was creating inefficient capital allocations. These problems brought

on what is called as deregulation. Deregulation is were the government drops

many of the regulations that were put on the corporations. The period of

deregulating in the late 70?s is stated by many economists to be very crucial

in the affect of our economy today. Major corporations such as American

Airlines, AT&T, El Paso Natural Gas, and Bank America went through a process

of deregulating in the late 70?s and into the 80?s. Even though recent acts

of deregulations have occurred and have been proven to be very successful, there

are also benefits to regulations along with the disadvantages. Social

regulations are most beneficial to the consumer, because it protects them from

their employers to what they eat. With out these regulations corporations might

take short cuts to save on money, while in turn they are harming their consumers