By: Michael Li
The United States economy is the strongest in the world. The policies of the Trump administration over the next four years will have a role in dictating whether that will persist. Statistics from Forbes show that the People’s Republic of China poses a formidable threat of overtaking the US economy within the next decade, but the United States cannot give up on further economic improvement. Though unemployment and GDP are already at a healthy value, there are several ways in which the Trump administration can improve the U.S. economy.
Firstly, the Trump administration should focus on improving the quality of our nation’s education. According to U.S. News, “improving basic education can boost [the] U.S. economy by $27 trillion.” How does this make sense? Providing strong education to students may not seem beneficial to the economy in the short term; however, students who have received higher-quality education in their childhood will end up as more productive workers with better jobs. Therefore, in the long run, these future generations will bring economic growth if they gain the human capital that comes from good education.
Secondly, to boost the economy, the US should focus on increasing the labor force participation rate in the United States. The labor force participation rate refers to the portion of people who are employed and unemployed out of the total working age population. According to statistics from Trading Economics, the highest American labor force participation rate was recorded in 2000, with a staggering 67.30%. However, while unemployment has changed cyclically since then, labor force participation has gradually fallen, as fewer people remain in the workforce. Therefore, to improve the economy, it is the job of the Trump administration to promote growth of these numbers. Trump focused a large portion of of his campaign promising the creation of more American jobs through infrastructure spending and tariffs on outsourcing, so there is the potential for more people to join the workforce and increase labor force participation to new levels.
Finally, the Trump administration should focus on reforming the tax code. The current taxation system in America is too convoluted and complicated, hurting small business while allowing larger corporations to find loopholes. Additionally, American companies often choose to invest elsewhere to escape hefty taxes. According to MarketWatch, encouraging investments from large domestic and international companies could prove to be beneficial. By investing in America as opposed to competing countries, these private corporations could help make a tremendous contribution to the U.S. economy.
Undoubtedly, there is room for the United States to work towards a better economy. If the Trump administration is able to focus on improving education, promoting labor force participation, and bringing tax reform, the US economy will indubitably remain the strongest in the world for the near future.