The 5 Challenges America Must Tackle in 2015
The New Year is a time-honored opportunity for each of us to start afresh—to make the changes we know we must for our own good, renewing our commitment to personal growth.
Nations are not so different from people. Like individuals, every country is challenged by problems to solve, shortcomings to overcome, bad habits to break, and improvements it must make to achieve its best self. So what better occasion than the advent of a New Year and new Congress for America to make national resolutions to do what we know we must for the nation’s own good?
Atop the list should be stimulating vigorous economic growth and restoring America’s competitiveness. Though it can’t solve all our country’s problems, absent economic expansion we won’t overcome any of them.
Among our most pressing challenges are:
- Creating a sufficient number of good paying jobs. Unemployment, underemployment, a growing population of workforce dropouts, and wage stagnation are damaging the happiness and prospects of our people.
- Reducing poverty and decay. Nearly forty-five million Americans, including 16 million children, live in poverty. Millions of Americans exist in blighted communities in which want, crime, and decay reign supreme. A study cited recently in the Huffington Post states that “Four out of five U.S. adults struggle with joblessness, near-poverty, or reliance on welfare for at least parts of their lives, a sign of deteriorating economic security and an elusive American dream.”
- Saving vital public programs. Social Security and Medicare are underfunded and remain unsustainable as currently structured. Many other public initiatives supporting Americans’ material and societal wellbeing are threatened by a weak tax base, cancerous fiscal imbalance, poor design, waste, and inefficiency.
- Defusing the ticking time bomb of exploding national debt. America has crossed into an economic minefield—with national debt exceeding 100% of annual GDP—and we continue to drive deeper into the danger zone. As the imbalance in our public accounts grow severer so does a chokehold on the treasury, commanding an ever greater chunk of the country’s annual receipts just to pay interest on our IOUs. This leaves fewer resources for higher priorities. Moreover, excessive national hock places upward pressure on interest rates, inflation, and taxes—all of which darken the economic picture and make the debt crisis even more difficult to solve. Today’s low interest rate enables government to borrow for nearly nothing. This encourages unsustainable spending while limiting the tools government has at its disposal to pursue countercyclical fiscal policy. Moreover, it means that a future of higher interest rates will multiply the debt burden and rob an ever greater share of the nation’s yearly income to service it.
- Maintaining U.S. global leadership, influence and security. Without a strong and vibrant economy, America can’t hope to lead a world still hungry for our values and influence. A strong America is required to confront a growing roster of threats to international peace and stability. Extreme and violent ideology is on the march. A growing range of weapons of mass destruction are becoming easier to access and exploit. The cyber vulnerabilities of an increasingly networked economy are titanic. Rogue states and unstable leaders still endanger the world, as do food, water, and energy insecurity.
An enfeebled U.S. economy makes every one of the problems worse. Vibrant, sustainable private sector-led economic growth makes every one of them more soluble.
We have work to do and resolutions to make. But, whether talking about people or countries, what determines whether our resolutions are accomplished or bound for the scrap heap of good intentions? Human experience points to three levers for turning aspirations into achievement:
- A sensible strategy
- A set of practical steps
- Unswerving self-discipline
I'll explore these levers further in a subsequent blog post, "9 Practical Steps to Producing Prosperity," and I'll discuss the practical steps we must take to address the challenges I've mentioned here.