Have you ever found yourself in a similar position to one of those above? What did you do?

UNIT 18

 

ECONOMIC ISSUES. AN UNCERTAIN FUTURE

 

We live in uncertain times, both politically and economically. In your view, what are the greatest threats to the world economy and societies?

• political instability • racial tension

• mass unemployment • hyperinflation

• massive trade deficits • cheap labour markets

• poverty in the Third World • the debt crisis

• the North-South divide • the East-West divide

• the collapse of communism • environmental damage

• a population explosion • an ageing population

• under-employment • trade wars

Write down here what you consider to be the four key global issues from the list above or choose others that you believe to be even more important. What do you think their economic implications might be?

 

GLOBAL ISSUES ECONOMIC IMPLICATIONS

1.....................................................

2.....................................................

3......................................................

4.....................................................

Mark the countries or geographic areas on the map you think will have the most direct or indirect impact on the global economy over the next five to ten years. North, Central, Latin America7 The EU? Central Europe? The former Soviet Union countries? The Middle East? Africa? The Far East? The Pacific Rim? Can you justify your view?

 

 

1. Compare your views with your groupmates and those expressed in the article, The Death of Economics. Read and translate it.

The Death of Economics

 

The world economy is falling apart. And no one has a clue what's going wrong — least of all the economists.

Whereas, in the past, supply and demand usually had a way of evening themselves out, we now swing from hyperinflation to soaring unemployment as slump follows boom. The once predictable business cycles which drive the market economy have gone completely out of control. The economic statistics issued by governments every month seem more unreliable than ever. And, for the first time, politicians have started talking about 'the death of economies'.

Recession and Collapse

For all its industrial might, the United States can do nothing to close its trade gap with Japan. And yet, in spite of a healthy trade surplus, Japan is itself sliding deeper into recession. In Germany it's the same story. And almost before their economies have had a chance to recover from years of communism, many of the former Soviet bloc countries are on the verge of economic collapse.

The Unemployed Underclass

But it isn't crippling deficits in the West and post-communist chaos in the East which pose the greatest threat to the world economy. Neither is it the global arms build-up, political instability in the Third World or the Latin American debt crisis. No. The single biggest economic disaster at the end of the 20th century is the emergence throughout the industrialized nations of a vast and permanent underclass of unemployed.

Cheap Labour From The East

In the EU, official figures put the number of unemployed at more than five times what it was 20 years ago. In Central and Eastern Europe wages have fallen so far behind escalating inflation that immigration controls in the West have had to be tightened to prevent an influx of workers from the East. But this hasn't stopped Western companies exploiting cheap labour in Eastern Europe and putting their own employees out of work.

The Working Poor

In the USA, where unemployment benefit is cut after six months and staying out of work is not an option, they claim to be creating jobs, but only at the cost of falling real incomes. For in many of the inner cities of the USA they have something approaching a Third World economy with millions of people working for far below the minimum wage. In Japan too the problem is not so much unemployment as under-employment, with many of the Japanese, in fact, in low-paid dead-end jobs. If Europe has a growing army of unemployed, Japan and the States now have an army of working poor.

The Disadvantaged Minority

The consequences of this are far-reaching. It goes without saying that a consumerist society depends on a plentiful supply of consumers. But consumers need to be earning money in order to consume. Eventually, a disadvantaged minority will undermine the whole social system.

The Myth Of Economic Growth

Over the past decade it has been popular to talk about economic growth as if it were the answer to all our problems. But, even if there were any evidence that economic growth naturally leads to lower unemployment, which there isn't, the rate of growth amongst the world's richest nations has actually been steadily declining since the 1960 s.

Economical With The Truth

Current government figures point to an economic recovery. But can we trust government figures? If they say our balance of trade has improved, how do we know that it is true? If you were the government, the pound was fragile and the announcement of a bad trade deficit could cause it to collapse, what would you do? Spend a billion supporting sterling or put out a set of massaged figures? As journalist Richard Northedge puts it, «it's often easier to be economical with the truth than truthful about the economy».

 

2. Find English equivalents in the text:

(1) выравнивать; (2) колебаться между гиперинфляцией и стремительно растущей безработицей; (3) внезапный спад (дело­вой активности) сменяется ее быстрым подъемом; (4) выйти из под контроля; (5) спад и развал; (6) ликвидировать дефицит торгового баланса; (7) представлять угрозу; 8) низшие слои об­щества; (9) безработные; (10) заработная плата отстает от расту­щей инфляции; (11) наплыв рабочих; (12) выгонять служащих с работы; (13) пособие по безработице; (14) за счет падения реальных доходов; (15) минимальная заработная плата; (16) не­полная занятость; (17) низко оплачиваемая бесперспективная ра­бота, (18) работающая беднота; (19) далеко идущие последствия; (20) потребительское общество.