By James McKee
The decline of the United States and its currency (the USD) have resulted in many hardships experienced around the world, and as the United States capital reserves and borrowing power erode local governments are feeling the pain. California has recently lowered most state workers’ pay to minimum wage, causing outright uproar. In a state where the average rent for a 1-bedroom apartment is over $1500.00, many find it difficult to survive on $10.00 an hour (before taxes, of course). These difficulties have resulted in a populace that is discontent and outright irate, many other states thought that California was an isolated incident but they are waking up to the truth.
The truth is that the USD’s value has dropped by over 20 percent in the last 15 years; this means that things are far more expensive than we realize. The prices of many goods have become cheaper due to outsourcing and the purchase of goods from abroad as well as government subsidies…however these subsidies are coming to an end. The Obama administration has stated they will be cutting the Federal Pell Grant program’s funding in half, in an already expensive education system this is quite the blow to those who want to improve their lives.
Most municipalities across the US are being weighted down to the point of implosion through various pensions that have accumulated nearly 50 billion dollars of debt. The reaction to this financial quagmire has been to cut the pay of those state workers still on the payroll, and to slash their benefits as well. A country without the proper infrastructure at a local level cannot hope to survive and there will be a price to pay for underpaying and not providing support to police, fire departments and so on. Those on the forex currency exchange should carefully monitor how the United states copes with these issues in the near future.
Author is a Forex trader and financial analyst residing in Denver, Colorado. To stay up to date on all the latest developments in the financial world and beyond be sure to check out the forex exchange rates regularly.