WASHINGTON, Dec. 30 (Xinhua) -- The US economy relayed a decade-long expansion in 2019, but problems remain, including economic inequality and youths saddled with mountains of student debt.
File photo by CGTN
The United States has experienced an economic boom over the past years. The stock market has seen record highs and unemployment is at record lows. African American and Latino unemployment has also hit all-time lows.
"The tax cut of 2017, while it was skewed toward the rich, provided a large stimulus for the economy and extended the ongoing economic recovery," Brookings Institution Senior Fellow Barry Bosworth told Xinhua.
"The result has been very low unemployment without any evidence of inflation," Bosworth said.
But problems persist, such as income inequality and heavy student debt. Moreover, while jobs are being created, many are low paying positions in the service sector.
"The administration has done nothing of significance to address the economic inequality or the deterioration of the environment. (President Donald Trump's) trade policies have also imposed large costs on the farm sector and created a perception that the US is an unreliable supplier of agricultural products," Bosworth said.
In an article in US publication Fast Company, Heidi Shierholz, a senior economist and policy director with the liberal Economic Policy Institute, was quoted as saying the economy is "growing, growing, growing. But the fruits of that growth are not broadly shared -- they're captured by the people at the top."
Indeed. US Census information recently found that income inequality stands at all time highs, with the top 1 percent of Americans taking in a third of the nation's wealth, and the bottom half grabbing only 1.2 percent.
The price of higher education, which 20 years ago was quite affordable, has skyrocketed, leaving millions of young people saddled with debt. At least 45 million Americans are carrying a record high of 1.6 trillion US dollars in student loans, according to the Federal Reserve Bank of St. Louis.
Many have so much debt they are only paying the interest -- after five years paying off the loans, 50 percent of borrowers have not yet paid even one dollar of the principal, according to Data.gov, a US government data website.
Twenty percent of borrowers are not up to date on their monthly payments, and 40 percent could default by 2023, according to a Brookings Institution report entitled "The Looming Student Debt Default Crisis is Worse Than We Thought".
Home ownership is used by US families as the primary source of investment and savings. But that's down, according to Census.gov, a US government website, although it remains unclear whether that's because fewer Americans can afford to own a home, or whether those numbers are a reflection of millennials' preference to rent rather than buy.
In an analysis of the US economy released last month, the Brookings Institution reported that "even as the US economy hums along at a favorable pace, there is a vast segment of workers today earning wages low enough to leave their livelihood and families extremely vulnerable."
The report said "53 million Americans between the ages of 18 to 64 -- accounting for 44 percent of all workers -- qualify as 'low-wage.'"
"Many also misunderstand who these workers are," the report continued. "They are not only students, people at the beginning of their careers, or people who need extra spending money. A majority are adults in their prime working years, and low-wage work is the primary way they support themselves and their families."
Although many people move onward and upward from low-wage work, many do not, the Brookings report found.
Women, people of color, and those with low levels of education are the "most likely to stay in low-wage jobs," Brookings argued.
"In our analysis, over half of low-wage workers have levels of education suggesting they will stay low-wage workers. This includes 20 million workers ages 25-64 with a high school diploma or less, and another seven million young adults 18-24 who are not in school and do not have a college degree," according to Brookings.