Many older homes have 3-prong outlets with no grounding wires attached to them. This condition is called an ungrounded 3-prong outlet (or “open ground”). A typical wiring configuration on a correctly wired outlet consists of 3 wires.
The slightly smaller slot on the right side of the outlet is called the “hot.“ Its symbol is (+). The conductor wire supplying power and connected to this slot is black or red. The hot wire carries an electrical charge from the main panel and to the device you're plugging into the outlet. The slot on the left, slightly larger, is called the “neutral.” Its symbol is (-). The conductor wire connected to this slot is white in color. This wire returns the electric charge to the panel when you plug a device into the outlet, thus completing a circuit. The end result is a working device. The hole under the two slots is the ground. The grounding wire is green, or sometimes bare copper. It’s purpose is to safely carry unwanted electrical current safely to ground.
A properly grounded electrical panel is connected to a metal rod driven into the ground called the “grounding rod.” There is a copper wire that is attached to the panel’s neutral bus and connects it to this rod. Typically, correctly grounded panels are double grounded to plumbing and gas piping, although this can depend on specific municipality requirements. There should be no confusion about the white neutral wire and the green grounding wire. Simply put, the white wire is part of the circuit and the green wire is not. The device will not work with the white wire disconnected but will work with the green wire disconnected.
If you look around your house, you will notice that just about every appliance that has a metal case has a three-prong plug. Even computers that appear to be plastic have a metal encased power supply. The idea behind grounding is to protect you and your equipment. An example here is that if a loose hot wire touches a metal case, or if a power surge or lightning strike affects an improperly grounded appliance, it may energize the case. Any person who touches it can be harmed and it could be potentially fatal. The human body contains just enough resistance to electrocute us. With the metal case properly connected to the ground wire, should the positive wire touch the case, it will short out on the case and this should trip the breaker. Now the appliance wont work but it won't electrocute you either.
When three prong ungrounded outlets are present the best solution is to have an electrician correctly wire the outlets. This may mean running new modern cable to each outlet. Modern cable for residential wiring is commonly known as Romex, typically 12/2 or 14/2 with ground.
This is the best solution. However, sometimes it is just not practical because of finished walls and ceilings or budget will not allow rewiring. Until the incorrectly wired outlets can be correctly wired a simple solution is to have an electrician install two prong outlets. This is a correct wiring configuration when no ground is present. It is important to understand that if you cut off the ground on the cord or use a cheater plug (pictured above) in a two prong outlet the appliance will still work; but you have nullified an important safety feature. It is particularly important that appliances or anything with a steel case are plugged into grounded outlets. Until the outlets can be correctly wired, there are other safety devices such as GFCI and AFCI breakers and surge protectors that can be installed in the panel and elsewhere to provide an additional level of safety. An electrician can advise you on the best and safest solution for your specific circumstances when three prong ungrounded outlets are present in a dwelling. Basically, a grounding wire (green wire), along with the breaker on the panel, will protect appliances, electronics, and you.
I was listening to Stevie Wonder’s “Higher ground” the other day, and in the lyrics he wants people to keep on learnin’, sleepers to keep on sleepin’, preachers to keep on preachin’, and the world to keep on turnin’, and don’t let nobody bring you down till you reach your highest ground. Some folks think he’s singing about past reincarnations and a destination in heaven, but I think he was actually wanting folks to be safe in their use of electrical devices. If your outlets reach the higher ground, nothing’ will bring you down.