As you are all aware In 2016 we will be electing a new presi

As you are all aware, In 2016 we will be electing a new president of the U.S. If you were chosen to be the chief economic advisor to the new president, list 3 economic problems facing the country today that he/she should focus on. Explain why you chose these particular problems.

Solution

Answer:

US economy is facing some major economic issues on a large scale and maximum people of US are unaware of some signs of the economic problems. These problems are not the results of sudden economic changes in the economy; these are the consequences of some faulty decisions making.

If I am elected as an economic advisor of US president then three most important sectors I will focus on are balance of trade, labour market and domestic production market.

There is trade deficit in the US economy due to the exports over imports. US economy is exporting more than import and is depending heavily on the foreign production, financing and innovation. So, US economy is losing its self sufficiency of production and to satisfy domestic demand of the people of the country. So economy is selling its home assets to finance its domestic demand and to maintain its high standard of living, but through this way of maintaining high standard of living US economy is taking on huge debts on them. Through this way an economy cannot achieve sustainable standard of living of the people of the country. Due to the pressure of huge debt country can lose its independent decision making power and this may lead to a huge crisis in the economy like the previous crises.

So the first action must be to control the trade deficit problem by reducing some regulatory and taxes that have already increased the cost of production of domestic production. The main cause of the upcoming crisis is the globalization and trade policies taken by US economy. There is a need to change the policies to protect the country.

Unemployment is another important problem of US economy and this was mostly caused foreign trade practices. Currency manipulation of China has cost million jobs of US economy. So we just to encourage the home production and innovation. This can improve the domestic labour market. As US is economy is in different position from world low wage markets.

Another important sector is the domestic production of the US economy. US economy should not totally believe that other countries will maintain the standards in some areas of environment, competition and labor. To increase the production capacity of home production we need to enhance this market by give protections to them so that US takes part in the world market competition. So, foreign countries need to satisfy some conditions on strategic analysis to access the US market. These steps can improve the situation of the domestic producers and make them competitive with respect to the world market.