Current Consumer Income of the United States

Real income is the purchasing power of the income of an individual, group or

nation, calculated by adjusting income to the price changes. A comparison of revenues
in 1970 and 1980, for example, would not make sense unless the 1970 and 1980 price
levels were identical. The use of a price index showing, for example, means that
consumer prices increased by 50 percent between those years, it becomes evident that $
1,000 in 1980 bought what $ 667 bought in 1970. Therefore, even if the total income
doubled, real income will double if prices remained constant. Data on household income
or consumption come from household surveys, the results adjusted for household size.
(U.S. Census Bureau, 2013) Nations use different standards and procedures in collecting
and adjusting the data. (IndexMundi, 2013) When the consumer income increases, the
demand for a good increases (commonly normal goods). The opposite happens with
inferior goods because they can be replaced with better goods , such as happens when
the consumer has more income buying better clothes .
Data published by the Department of Commerce in March 2013 showed that
personal income fell 3.6 % in January, the biggest drop in 20 years. The fall was even
greater when taking into account taxes and inflation. Real disposable personal income
fell by 4 %, the biggest monthly drop in half a century. What this means is that the U.S.
economy is not only recovering from the recession more slowly than you want, but it is
actually getting worse for many Americans. Despite three and a half of uninterrupted
years real GDP growth and a decline of more than two percentage points in the
unemployment rate since 2009, the standard of living is falling as much as half of the

population , especially if you look monthly issues beyond the long-term trends . (Time,
2013)
There is a need to start the process of reviving the economy. There are some tips
that can be followed, like: adopting a comprehensive strategic plan that addresses all
productive sectors, the government should adopt a performance-oriented and achieving
managerial model results; better communication between the government and the
private sector should be achieved, where the private sector must take the lead in
implementing the agenda of economic development coordinating initiatives with
legislative bodies; should address as a priority the issue of permitting processes and
reduced costs of doing business; and do an effort to improve the image of the country
by strengthening the image and the development of a brand (branding).
The United States developed an economic stimulus package aimed at revitalizing
the economy. The stimulus package looked great, with more than 2 % of GDP per year,
but a third is for tax cuts, and at a time when Americans face a surplus of debt,
unemployment is rapidly growing and the asset prices are falling, then probably this
saves much of the tax cut. Almost half of the stimulus simply offsets the contractionary
effect of cutbacks at the state level. More important than the sheer size of government
debt are the debt 's effects on the economy. When the government borrows , it promises
to repay the lender. To make the government ultimately from those repayments will
have to raise taxes and impose extra taxes, beyond what it needs to pay for its other
activities. The economic effect of government debt depends heavily on how taxpayers
perceive those future taxes. The stimulus will strengthen the U.S. economy , but
probably not enough to restore robust growth. Delaying bank restructuring is costly,

both in terms of the eventual bailout costs and the damage to the overall economy in the
meantime. Socializing the losses, while privatizing gains, is more worrisome than the
consequences of the nationalization of banks. American taxpayers are getting an
increasingly bad deal. In the first round of cash infusions, they got about $ 0.67 in
assets for every dollar they gave. But in recent cash infusions, it is estimated that
Americans are getting $ 0.25 or less per dollar. Bad terms mean a large national debt in
the future.

References
IndexMundi (2013) Ingreso o consumo de la unidad familiar por porcentaje. Estados
Unidos.
http://www.indexmundi.com/es/estados_unidos/ingreso_o_consumo_de_la_unida
d_familiar_por_porcentaje.html
Sivy, M. (2013) Why Many Americans Feel Like They're Getting Poorer. Business and
Money. Time. http://business.time.com/2013/03/05/why-many-americans-feellike-theyre-getting-poorer/#ixzz2rdywC2Xl\
United States Census Bureau (2013) Current vs Constant (or Real) Dollars.
https://www.census.gov/hhes/www/income/data/historical/dollars.html
Pethokoukis, J. (2013) Whoa! Is the US on the verge of running a budget surplus?
http://www.aei-ideas.org/2013/05/whoa-is-the-us-on-the-verge-of-running-abudget-surplus/
Seater, J. (2008) Government debts and deficits. The concise encyclopedia of
economics. http://www.econlib.org/library/Enc/GovernmentDebtandDeficits.html
Stiglitz, J. (2009) Cmo no recuperarse? Revista Venezolana de Economa y Ciencias
Sociales. 2009, Vol.15, No.2 pp. 155-157. ISSN
20030507.http://www.scielo.org.ve/scielo.php?script=sci_arttext&pid=S131564112009000200020&lng=es&nrm=iso