US Independence Day: The stripes of dollar success

The United States has the world's largest economy, and represents about 20 per cent of total global output. Its total budget outlay exceeds $18 trillion, and has the 6th highest per capita GDP. Moreover, not only do large U.S. corporations play a major role on the global stage, but its economy is also dominated by the services sector in areas as influential as financial services, telecommunications, technology, aeronautics, heavy machinery, retail and healthcare. It is said that more than a fifth of global fortunes and investments are American flagship companies engaged in business within the U.S. and abroad. Last but not the least, the country has access to abundant natural resources and a vibrant physical infrastructure. While it is home to free-market economy, the government nonetheless exercises stringent regulations over commercial and financial activities. 
The U.S. dollar is by far the most used currency in international transactions, and also the most widely held reserve currency. Despite in a fix in terms of trade deficit and balance of payment issues, the U.S. economy remains afloat, thanks to the fact that Reaganomics is still in vogue, i.e. policies introduced by former president Ronald Reagan, wherein objectives were regulation and reduced government spending. One of the major international dimensions of its economy has been dependence on foreign oil to meet energy demands. But that concern seems to be gradually withering away with upgraded U.S. Shale activity on its mainland and shores. 
Predictable oil prices, with crude fluctuating below the $50-a-barrel threshold, have helped the economy rebound, and register progress. The administration of President Donald Trump believes that 3 per cent GDP growth is attainable. The economy, however, grew at the rate of 1.6 per cent in 2016. It hopes that labour productivity; capital investments and technological efficiency can help pass the goalpost. The U.S. needs to assess its tax base in a very firm and perpetual manner. That would mean reforms to eliminate loopholes or provisions that benefit taxpayers in conjunction with lowering tax rates. Bringing down the tax slab and broadening the base are some of the suggestions awaiting executive action. 
Taxing the rich and furthering the blanket of subsidies for the poor and middle-class is a constant of American economy. Innovations are the need of the hour if America has to keep pace with advancements in science and technology. Transportation, communication and aviation infrastructure in the U.S. are some of the oldest, yet competitive and robust. But they are in need of modernisation. This is why President Trump called for privatising the air control system, so that revenue could be raised from air tariff to rebuild and expand the aviation infrastructure, and subsequently move the technology from radar-based to GPS. Modernisation in services and industries could bring in wide scope for faster economic growth.
As unemployment fluctuates around 4.3 per cent, a recent jump in employment to a two-year high indicates sustained labour market strength across the U.S.. Some of the salient features of the economy are that it possesses an important and indispensable manufacturing base, which represents 15 per cent of output. It is the second largest manufacturer and a leader in high-value industries such as automobiles, aerospace, telecommunication, heavy machinery and chemicals. While agriculture represents less than 2 per cent of output, the U.S. is a net exporter of food and the largest agricultural exporting country in the world.
The U.S. is number one leading importer, and at the same time, the second leading exporter of goods and services in the world. A country that runs a constant trade deficit is also a player on the world stage with powers-to-be in China, European Union and the South American region; shifting its goals from free market economy to calls for protectionism, when need be. The biggest strength of its economy is a well-educated and productive workforce. With home to some of the best technological inventions, coupled with a superb entrepreneurial base, the U.S. is fully leveraged to lead the world from the front. Its market-based economy with a laissez-faire approach - by upholding capitalism, along with an assertive foreign policy agenda, makes it an indispensable power icon. 
The U.S. has many new heights to scale. Its economy is growing at an ideal range of 2 to 3 per cent, and luckily inflation is contained. The good point is that the country has successfully overcome recessionary trends and its business lookout is positive. It's time for Trump to create more jobs along with the promised tax cuts. America's over-reliance on China and fear of the Red Dragon overtaking it has to be put to rest. 'America First' shouldn't merely be a slogan. The nation of immigrants should uphold the winning streak, yet again!
- mehkri@khaleejtimes.com