Problems of US Economy and Solutions to the problems
State the problems of US Economy and Solutions to the problems
Sample Solution
The United States economy has been facing a number of challenges in recent years, with the most prominent being income inequality and persistent slow economic growth. In terms of income inequality, research has shown that the top 1% earners now receive nearly 20% of all pre-tax national income compared to 10.5% back in 1980 (Piketty & Saez 2016 ). This is combined with sluggish economic growth which saw US GDP increase by an average of just 2.3 % between 2010 and 2019 – significantly lower than the 3.2 % seen prior to 2008 (Yellen 2017).
To mitigate these issues, policymakers should focus on policies which promote job creation such as targeted fiscal stimulus or raising minimum wages so those at the bottom end have higher spending power (Smith et al., 2018). Additionally, they can look into regressive tax reforms so wealthier citizens pay their fair share while also increasing government assistance for lower-income households to reduce poverty rates (Stiglitz 2012).
Ultimately then, implementing long term solutions such as these will be essential for tackling current economic woes. These initiatives coupled with further investment into important areas like education – ensure our workforce remains competitive -and improved labor protections could potentially lead to a more robust economic recovery over time(Galbraith& Leonhardt 2018).
