OBAMA: The US economy has 4 huge problems — here's how I'd fix them

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In an op-ed for The Economist on Thursday, President Barack Obama laid out his views on the shortcomings in the US economy and a way forward for the next president to improve the economy. He also vented some of his frustrations with the current political discussion of the economy.

32 PHOTOS
31 photos of the Obama family over the past 8 years
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31 photos of the Obama family over the past 8 years

January 20, 2009

At the president's inauguration. 

Photo: Pete Souza/Courtesy of The White House

January 20, 2019

Backstage at the inauguration.

Photo: Pete Souza/Courtesy of The White House

February 22, 2009

Dancing at the Governor's Ball.

Photo: Pete Souza/Courtesy of The White House

April 5, 2009

Signing the guestbook at Prague Castle in the Czech Republic.

Photo: Pete Souza/Courtesy of The White House

August 8, 2010

Celebrating the president's 49th birthday.

Photo: Pete Souza/White House

August 8, 2010

At the president's 49th birthday barbecue.

Photo: Pete Souza/Courtesy of The White House

August 14, 2010

Swimming with Sasha in Florida.

Photo: Pete Souza/The White House

December 27, 2010

Eating shave ice in Hawaii. 

Photo: Pete Souza/The White House

January 19, 2011

The president and First Lady entering a state dinner with Chinese president Hu Jintao.

Photo: Pete Souza/The White House

March 2, 2011

Preparing to greet recipients of the National Medal of Arts and the National Humanities Medal. 

Photo: Pete Souza/The White House

June 11, 2011

Celebrating Sasha's birthday at Camp David.

Photo: Pete Souza/Courtesy of The White House

July 4, 2011

Watching fireworks from the roof of the White House.

Photo: Pete Souza/The White House

January 1, 2012

A New Year's Day swim in Hawaii.

Photo: Pete Souza/The White House

July 16, 2012

Caught on the kiss cam at an Olympic baseball game.

Photo: Pete Souza/The White House

September 6, 2012

Backstage at the Democratic National Convention.

Photo: Pete Souza/The White House

January 17, 2013

Singing 'Happy Birthday' to the First Lady.

Photo: Pete Souza/The White House

January 20, 2013

A family portrait on the president's second Inauguration Day.

Photo: Pete Souza/The White House

January 21, 2013

Riding in the inaugural parade.

Photo: Pete Souza/The White House

June 16, 2013

Backstage at Sasha's dance recital. 

Photo: Pete Souza/The White House

February 11, 2014

At a state dinner for President François Hollande of France.

Photo: Pete Souza/The White House

June 16, 2016

On the South Lawn, returning to the White House after a trip to California. 

Photo: Pete Souza/The White House

June 16, 2016

On the South Lawn, returning to the White House after a trip to California. 

Photo: Pete Souza/The White House

September 14, 2014

Viewing a portrait of Abraham Lincoln at the National Portrait Gallery and Smithsonian American Art Museum.

Photo: Pete Souza/The White House

December 3, 2014

Under the mistletoe at a dinner for combatant commanders and military leadership.

Photo: Pete Souza/The White House

February 23, 2015

With Malia in the Oval Office.

Photo: Pete Souza/The White House

March 7, 2015

Listening to the remarks of Representative John Lewis in Selma, at the commemoration of the 50th anniversary of Bloody Sunday.

Photo: Pete Souza/The White House

April 5, 2015 

A family portrait on Easter Sunday in the Rose Garden.

Photo: Pete Souza/The White House

July 17, 2015

With Malia at the Whitney Museum, in New York.

Photo: Pete Souza/The White House

August 22, 2015

Malia biking in Martha's Vineyard.

Photo: Pete Souza/AP

April 7, 2015

Exiting Air Force One in Chicago.

Photo: Pete Souza/AP

May 18, 2015

Malia in her yard. 

Photo: Pete Souza/AP

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In addition to touting the work he had done, Obama discussed four challenges facing the next president and ways that they can take on those challenges. The challenges were:

  1. Slowing productivity of workers. Obama noted that despite amazing technological gains, the growth rate of productivity of American workers has been declining. Obama said that encouraging private investment through improving tax codes on businesses, priming the pump with public investment, and creating trade deals like the Trans-Pacific Partnership would help to solve the issue.
  2. Increasing income inequality. Obama noted that the top 1% of earners in the US now receive 17% of all posttax income, versus 7% in 1979. His solutions include raising taxes on the wealthiest Americans, engendering a sense of community among those at the top and bottom, and raising the federal minimum wage.
  3. Declining labor force participation. Obama noted that 12% of prime-age men (25-54) are not in the labor force today, versus 3% in 1953. For women, this number has also increased, to 26% from 23% in 1999. Obama said wage insurance, a strong community-college system, and making reentry into the workforce from prison easier would help reverse the trend.
  4. Crumbling infrastructure. Obama said both the financial and the physical infrastructure are lacking in the US. On the financial side, Obama suggested keeping a closer eye on the shadow banking and nonfinancial lending system. For physical infrastructure, Obama said fiscal stimulus from the federal government could not only fix roads, but also encourage economic growth.

Underneath all of these problems, Obama said, is a political system that has polarized to the point that it has become nearly impossible to pass laws that would improve the economy.

"Unfortunately, good economics can be overridden by bad politics," he wrote.

Obama called the current state of politics "so partisan that previously bipartisan ideas like bridge and airport upgrades are nonstarters."

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