Essay Example on Conservatism: Ideology Behind Preserving Human & Social Rights

Introduction

Conservatism comes from the word conserve hence showing the people who are ready to conserve. Political ideologies are representative of the ideas that relate to the people of the nation. The doctrines have the sole aim of preserving and extending the scope of the human and the social rights of the people. Besides, the government has a mandate of providing positive rights to the people. For instance, American society has taken into consideration the conservatism in conjunction with economic liberalism and social conservatism. They are both aimed at providing protection of the small scale concepts and the liberty of the government while at the same time maintain the social values and the traditions.

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The ideological position that an individual takes or a political organization takes can be explained through the utilization of the social and economic policy. On the other hand, liberalism means the act of freedom. People have believed in free trade over time. Most of the nation and economic communities of the world believe in free trade. A combination of conservatism and liberalism gives rise to the concept of Liberal Conservatism. Therefore, Liberal conservatism is a political ideology that considers conservative and liberal policies without forgetting the economic, social, and ethical issues in societies.

Liberal conservatism incorporates minimal government involvement in the economy. This makes the people and the individual organizations have all the liberty required to operate freely in the free market. However, the liberal conservatism principle is made to act in that the people in the market cannot be in control of what they do and what they cannot do, resulting in other individuals or organizations with excess resources taking over the market acting in their interest. Such actions will affect the stability of the market, and one organization will gain power more than the others. The unfair competition will arise from the events hence trampling the lesser significant enterprises.

Therefore, with a free market, it is essential to make the state stronger in the economy to ensure that the economic institutions are responsible for what they do and what they do not do in the free market. The state creates rules and regulations that consider the economy and ensure that the organizations act responsibly.

Liberal Conservatism and Financial Crisis of 2008

The 2008 financial crisis was the next in the level in which it affected the people to the great depression. The federal government failed to control the crisis despite the efforts they had laid down and the strategies to mitigate the crisis. The crisis resulted in the housing prices dropping beyond the point they had dropped during the Great Depression. Two years later, the recession caused by the crisis came to an end, and still, the rate of unemployment was high by 9%. This value does not take into account the people who had despaired and given up the hope of being employed.

Liberal conservatism gave room for the people to operate freely and maximize wealth in the free market. However, the economic institutions did not behave responsibly in the open market; hence, they ended up making the decisions that resulted in toxic assets. First and foremost, the real estate enterprises flooded the market, and this caused an influx in the house pricing. The drop in prices was due to the unhealthy competition in the market. On the other hand, the banks played a critical role in the issuance of loans to homeowners. The Community Reinvestment act convinced the banks to invest in housing.

Efforts to shut down the housing market were met with criticism since the sector contributed significantly to the economy by guaranteeing several mortgages. The deregulation of the services and the financial system gave room for the banks to invest more in housing. Since the business was profitable and the financial institutions were profit-oriented, they wholly ventured into the business. The banks were not fond of risky lending borrowers; however, they gave money to risky borrowers without appropriate scrutiny and consideration in the housing sector. Also, the Modernization Act of 1999 gave the banks permission to make investments on derivatives with the use of the deposit. Since the banks were after the profits, they did not keep the promise of acting responsibly in the market.

Therefore, the liberal conservatism lacked the inclusion of an economically stable state to control the market when the need arose. On the other hand, the policies created by the state were not competent enough to prevent the recession and the involvement of the banks and other financial institutions into the market (Lattas, 2012). The participation of the banks led to a more rapid increase in housing in the housing market.

Policymaking models attributed to the federal government

The economic crisis of 2008 was a crisis that affected the whole world. It saw most banking and financial institutions and go down. Banks such as the Deutsche bank lost its legendary track and has never gained its pace again. An example of the blow the financial institutions felt after the economic crisis destroyed their plans on the yearly targets. The economy failed as a result of the issues that were taking place; the amount of money circulating in the economy was low, and several businesses failed. The banking institutions did not have adequate amounts to help them run the daily businesses.

It is the role of the federal government through its significant branches and other bodies, such as the federal bank, to help during an economic crisis. Through the use of various policymaking models, the federal government can turn back the economy to stability. The 2008 financial crisis was a recession, and the recessionary policies had to be implemented to ensure that the economy increases its spending. In such a scenario, the amount of money in circulation was low. Thus the government had to entice the population to enhance its general expenditure to remove the economy from the stagnation.

Through various policies such as an increase in the amount of money supply in the economy, people began spending. The banking institutions had to reduce the interest rates to allow more borrowing. The federal bank had to come in and reduce the reserve requirements. The reserve requirement is the minimal amount of money banks are required to have. They are calculated from the total savings the bank has had. Thus, a smaller reserve requirement would aid banks to increase the amount available for loan. The higher the supply will lead to a lower interest rate; therefore, the economy would have more to spend.

Economic Models best to reduce the crisis

The economic models are a pictured illustration of the plan, and they are used to illustrate the possible outcome. They are useful in predicting such scenarios are the great recession of 2008. In this way, the government can intervene in time to stop it from occurring. Times they occur before the models predict them. It makes it hard to eliminate this, and they are also implemented to ensure that they eliminate the current economic system. In this perspective, using the models will eliminate the crisis by predicting the measures that should be used to deal with it. The use of Non-Conventional Models is essential in relating the interrelationships between the problems affecting the economy. Elimination of one could lead to the elimination of the whole problem.

The models used in the 2008 crisis illustrate that the problem was well solved before the economy could b affected. From the stated information, the use of the models was affected as compared to the previous crises, such as the great depression. The 2008 crisis took a much shorter time. It means that the models used were the most appropriate. Even though the models had failed to predict it, they dealt with the issue significantly, reducing it before the economy suffered further. Had the models predicted it early in advance, the suitable control measures would have been implemented, thus ensure that the crisis would not hit the economy. However, the economy ended up in a recession in which the financial institutions profoundly affected their ability to give loans, and the standing market process was difficult (Kaur, 2015). The government helped with the situation by providing with the best.

Conclusion

The recessionary fiscal policies that the government used include the reduction of the taxes paid by the financial institutions. The market of the financial institutions had to be eased. It would ensure that they invest more in supplying the economy with the required money to close the recessionary gap. To avoid recessions from happening, there should be adequate money supply in the economy. It is only to ensure that the economy continues spending. A recession occurs when the economy stops spending. Thus, to stop the recession, investors have to be enticed to borrow money through cheap loans and grants.

References

Kaur, I. (2015). Early warning system of currency crisis: Insights from global financial crisis 2008. IUP Journal of Applied Economics, 14(1), 69-83. Retrieved from https://search.proquest.com/docview/1691575185?accountid=776

Lattas, A. (2012). Consultancy, neo-liberal conservatism and the politics of anti-politics. Oceania, 82(1), 113-118. doi:http://dx.doi.org/10.1002/j.1834-4461.2012.tb00123.x