The U.S is one of the richest countries in the world, but it faces some serious economic issues as well. Arguably, the following are the four most critical problems that America needs to combat right now:
1) U.S national debt: U.S national debt has crossed $14 trillion. Finally, America has reached the debt ceiling and there have been serious concerns all around. Treasury Secretary Timothy F. Geithner has already warned about catastrophic effects due to this development. While nobody can actually deny that the borrowing limit must be raised, it is equally important to get things under control. The national debt of U.S.A must be reduced, but the solution remains elusive as the Democrats and the Republicans fight over tax increases and budget cuts.
2) Overwhelming consumer debt: As per statistics from the Federal Reserve, consumer debt stands at 2.43 trillion. Debt level has reached a record high due to the fact that the U.S consumers are too addicted to credit cards. As long as consumer behavior does not change, consumer debt will not dwindle and the U.S economy will experience a debt fuelled growth. President Obama has already warned about such a situation. Will consumer debt get under control? Or will it reach new heights? Let’s wait and watch.
3) The dragon of Inflation: The U.S is experiencing a record high inflation rate (3.16% in April 2011, highest in last 2.5 years). Gasoline and food prices are soaring steadily. Does it indicate that inflation is peaking? Possibly. The inflation might have been the result of the central bank’s steady pumping of money in the economy to stop the prices from going down. Rise in inflation would make most Americans really worried because it would leave their personal finance battered. Let’s see if the Federal Reserve can prevent the situation from getting out of hand.
4) Unemployment: This is the biggest challenge for the U.S. According to the U.S Labor Department, the current unemployment rate is 9%. Wage cuts and underemployment is also quite high. While Obama pledges to stop outsourcing, Ben Bernanke, Chairman of Federal Reserve, advocates creating “green jobs” in environmentally correct industries. Will the government be able to lower the unemployment rate? Let’s keep our fingers crossed.
By Teresa Smith