Economy of downturn

Despite being the largest economy of the world, US has just come out of its worst crisis of

credibility. The western economy is on fragile base and whenever pressure is put on it, it breaks

into peaces. So, it would be better for the emerging economies like China and India not to go

whole hog after western economy. It is the economy of light and colour which can not face all

weathers for a long time. The glaring example of this state of affairs of the US economy.
US has got temporary relief only after President Barack Obama signed into law a bill that

raises the nation’s borrowing limit and avoids a possible debt default after it was passed by the

Senate to avert a major economic crisis at the last moment. The urgency was such that the signing

of bill came within hours of the Senate passing the austerity plan that seeks to reduce the

deficit by USD 2.4 trillion.This gave the US Treasury Department an immediate authority to borrow

USD 400 billion. But raising the debt ceiling means a severe economic disruption has been

avoided, and the accompanying deficit reduction deal is an important step toward fiscal

consolidation.
The government had hit its debt limit of USD 14.3 trillion on 16th May and has since been

operating through spending and accounting adjustments.
The US has been the most vocal exponent of economic globalisation, which prevailed over the world

and the country which was reluctant to accept it in the beginning failed to keep itself united

due to economic crisis. The economic globalisation displayed pomp and show that attracted many

developing economies, including India and China. Before the advent of economic liberalisation in

India, its economic policies were based on Gandhian and Nehruvian and moving around socialism,

where the poorest of the poor should be benefited most through their skill and domestic

entrepreneurs.
Economic hardship is the biggest threat to the individual and the country as a whole. For the

last many years, US is passing through economic slump and the US economic managers have failed so

far to overcome it the country has been facing for the last few years. US economy is not long

lasting and has proved to be the economics of downturn.