The president appoints you to Council of Economic Advisors, what are 3 suggestions that you can give him/her to help the economy in its recovery - Essay Example

The president appoints you to Council of Economic Advisors, what are 3 suggestions that you can give him/her to help the economy in its recovery. Theeffects of the global economic crisis require effective strategies that will accelerate the US economic recovery. Been a member of the US council of economic advisors, the following strategies of economic recovery strategies would be effective to the country. The first indicator of the economic downturn in the US is the high rate of unemployment.

The president needs to increase his efforts of encouraging job creation in the private and public sector. During the period of economic crisis, the income of most households declined by about $ 2,000 over a seven year period (Krueger, 2012). This made retirement saving decline by 40% annually. In addition, people had mortgages and loans that needed to be paid. For them to exist in such economic conditions, the US economy turned into a credit economy. Thus creating more employment opportunity will enhance the stability of the currency and financial institutions.

In addition creating employment opportunities will increase the purchasing power of Americans and the market value for American commodities. This is the basis of economic recovery in a country. The country also needs to offer direct assistance to homeowners and not bailouts for lenders in the mortgage sector. Americans are continuously loosing the value of their homes by an annual rate of about 20%. Due to the deteriorating economy, most families are facing difficulties to meet their annual mortgage requirements (Krueger, 2012).

Providing direct relief to families that are struggling with mortgages will help them to concentrate on other aspects of economic development. The economic stimulus package given to homeowners will improve people’s purchasing power to save the declining retail sector. On the other hand, bailing out mortgage lenders would increase the amount of money in circulation lowering the price of the dollar (Hirschey, 2009). The third advice for the president on American economic recovery would target green jobs and investment in renewable energy sector.

The devastating effects of non-renewable sources of energy are evident. It is obvious that most global economies are moving towards green economies. America needs to increase investment in the sector in order to benefit from the trend. This would save the country numerous expenses spent to import oil from other countries. Currently America consumes about 30% of global oil and gas output. On the other hand, the country imports more than 70% of its oil and gas requirements (Hirschey, 2009). This indicates that America spend most of its resources in oil and gas imports.

The phenomenon also indicates a trade imbalance against the US. Investing in the green energy sector will reverse the trade in favour of the US. In addition investing in the sector would create employment opportunities for Americans. Investing in the sustainable energy sector would involve investing in industries that are working towards the development of the next generation cars that are fuel-efficient or use alterative sources of energy. Investing in the sector would also target the production of bio fuels in both the US and other potential countries such as Brazil and Chile.

Reference Hirschey, M. (2009). Fundamentals of Managerial Economics 9th Ed. Boulevard: Cengage Learning. Krueger, A. (2012). The Employment Situation in May. Economic Advisors. Retrieved from: http://www.whitehouse.gov/blog/2012/06/01/employment-situation-may