Previously we had thought that economic and politics is not interesting, we do not have to delve in it or participate in it. But last developments are changed our lifes so sharp, that we have to start thinking what is actually happening. Why does government increase taxes? Why are so big unemployment rate in our county? How could we get out of it? Many people ask nowadays these questions and not only in Latvia, because all actions are purporting that we are on the threshold of world crisis. Now it is not only our business what is happening here, because every wrong reaction can generate serious, unpredictable or anticipated consequences, which can impact not only Latvia.
Admittedly it does not mean that now country will obligatory collaborate. The situation is not so critical to disclaim theirselves interest or profits. Every state are more or less on their own because our society in capitalized.
However it is possible to get help from abroad, from Europe or world, because sometimes it is their liability and sometimes they can get something backwards. For example, if foreign enterprise invests money in Latvia, they get profit from money realization. Those states, who have saved up money, invest it in progressive states.
Latvia is not independent state for a long time thereby it does not have big experience to lead state knowingly through the crisis. Deputies also are not enough smart to avoid from other states mistakes and follow high developed state example or maybe they are just too greedy.
Author aim for this project work was to find out what actually is happening in Latvia and how does it effect her and other Latvia inhabitants.
To reach this aim author had to:
realize how is budget bill accepted
investigate Latvian budget bill formatting
compare it with other state
Only superintending current situation in Latvia and other substantial states we can give objective opinion about nowadays economic. Economics is based on positive and normative economic. Positive economic is economic theory course, which is based on experiential verity, but normative economic – based on subjective estimating what would have to be. It seams that Latvian government are working more with normative economic than positive economic however it would have to be opposite.
October 07 the Latvia budget project for year 2009 was accepted by the Cabinet of Ministers and submitted for further examination to the Parliament. The budget project anticipates 5 461 609 066 Ls income and 5 791 293 866 Ls expenses in year 2009 and 1.85% budget deficit from GDP. To reduce the budget expenses it is planned to reduce the amount of government sector employees for 10 %, which means to dismiss 2419 government employees. The Head of the Cabinet of Ministers has also announced, that the salaries of employees working in the public sector will not be rised though the amount of the annual inflation is still high. The Latvia Bank informs that in July the annual inflation was 16.7 %.…
