The Ground Wire
The term "ground" refers to a connection to the earth, which acts as a reservoir of charge. A ground wire provides a conducting path to the earth which is independent of the normal current-carrying path in an electrical appliance. As a practical matter in household electric circuits, it is connected to the electrical neutral at the service panel to guarantee a low enough resistance path to trip the circuit breaker in case of an electrical fault. Attached to the case of an appliance, it holds the voltage of the case at ground potential (usually taken as the zero of voltage). This protects against electric shock. The ground wire and a fuse or breaker are the standard safety devices used with standard electric circuits.
Is the ground wire necessary? The appliance will operate normally without the ground wire because it is not a part of the conducting path which supplies electricity to the appliance. In fact, if the ground wire is broken or removed, you will normally not be able to tell the difference. But if high voltage has gotten in contact with the case, there may be a shock hazard. In the absence of the ground wire, shock hazard conditions will often not cause the breaker to trip unless the circuit has a ground fault interrupter in it. Part of the role of the ground wire is to force the breaker to trip by supplying a path to ground if a "hot" wire comes in contact with the metal case of the appliance.
In the event of an electrical fault which brings dangerous high voltage to the case of an appliance, you want the circuit breaker to trip immediately to remove the hazard. If the case is grounded, a high current should flow in the appliance ground wire and trip the breaker. That's not quite as simple as it sounds - tying the ground wire to a ground electrode driven into the earth is not generally sufficient to trip the breaker, which was surprising to me. The U.S. National Electric Code Article 250 requires that the ground wires be tied back to the electrical neutral at the service panel. So in a line-to-case fault, the fault current flows through the appliance ground wire to the service panel where it joins the neutral path, flowing through the main neutral back to the center-tap of the service transformer. It then becomes part of the overall flow, driven by the service transformer as the electrical "pump", which will produce a high enough fault current to trip the breaker. In the electrical industry, this process of tying the ground wire back to the neutral of the transformer is called "bonding", and the bottom line is that for electrical safety you need to be both grounded and bonded.
This just touches the tip of the iceberg of the major subject of proper grounding and bonding of electrical systems.
Will connection directly to the earth trip the breaker?
Appliance ground example :
Three electrical connections are made to a standard appliance like a clothes washing machine. The "hot" wire carries an effective voltage of 120 volts to the appliance and the neutral serves as the normal return path. The third wire is the electrical ground which is just connected to the metal case of the appliance.
If the hot wire shorts to the case of the appliance, the 120 volt supply will be applied to the very low resistance path through the ground wire. This will cause an extremely high current to flow and will cause the breaker or fuse to interrupt the circuit.
One problem with this arrangement is that if the ground wire is broken or disconnected, it will not be detectable from the operation of the appliance since the ground wire is not a part of the circuit for electric current flow. In that case, if the hot wire shorts to the case and the neutral wire does not, then the breaker may not trip and the entire 120 volts will be applied to the metal case of the appliance, representing a shock hazard. The ground wire of an appliance is the main protection against shock hazard.
Grounding to a Water Pipe
Don't try this experiment at home!
A bare 12 gauge copper wire was inserted into the hot wire side and the voltage was confirmed by meter to be 120 volts. It was touched directly to a cold water pipe and did not trip the breaker! This is a copper pipe and extends without interruption directly out into the earth.
The DC resistance from both the ground and neutral electrical terminals to that copper pipe was measured and found to be essentially zero. The digital ohmmeter measured about 1 ohm or less to the pipe. If the earth were acting as a simple ohmic conductor back to the ground at the service box, it would have conducted 120 amperes and would have immediately tripped the breaker.
National Electrical Code Article 250.4
250.4 General Requirements for Grounding and Bonding
(5) Effective Ground-Fault Current Path. Electrical equipment and wiring and other electrically conductive material likely to become energized shall be installed in a manner that creates a permanent, low-impedance circuit capable of safely carrying the maximum ground-fault current likely to be imposed on it from any point on the wiring system where a ground fault may occur to the electrical supply source. The earth shall not be used as the sole equipment grounding conductor or effective ground-fault current path.