Six Economic Challenges
The Philadelphia Inquirer ran a short column about Richard Berner's thinking of six challenges facing the economy. (Berner is chief U.S. economist for Morgan Stanley.)
The column didn't go full depth to discuss the six challenges in specifics, but it is fairly easy to understand why they are real challenges:
1. Longevity: average lift spans are 13% longer, causing additional healthcare and retirement saving needs.
2. Healthcare Spending: now 14% of our GDP is devoted to healthcare, doubling 1970's level.
3. Low Saving Rate: we only save 2.5% of our national income and heavily rely on foreigners to make the difference.
4. "Fiscal Train Wreck:" federal budget deficits are draining national savings.
5. Education: lack of skilled workers are a threat to long-term productivity and employment growth.
6. Energy: volatile energy prices can disrupt the economy.
Source: The Kirk Report
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