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Improving US Economy May Help President

Improving US Economy May Help Presidenti
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January 25, 2014 12:05 AM
As President Obama prepares to give a key annual address to the nation, he faces political problems that have hurt his approval ratings. Experts say he may get some political help over the next year, as a gradually improving U.S. economy helps heal the battered housing sector and reduces unemployment. VOA’s Jim Randle reports.

Improving US Economy May Help President

— As President Obama prepares to give a key annual address to the nation, he faces political problems that have hurt his approval ratings. Experts say he may get some political help over the next year, as a gradually improving U.S. economy helps heal the battered housing sector and reduces unemployment.

Severe problems in the housing sector contributed to the recession that threw millions of Americans out of work and out of their homes.

Without jobs, they could not pay mortgages, so banks evicted families and tried to sell houses to recover the loan money. A glut of unsold homes pushed down prices, hurting homeowners, banks, and the overall economy.

But now the economy is growing again, and home sales are up, according to RealtyTrac Vice President Daren Blomquist, who spoke to VOA via Skype. "We saw a great bounceback in the housing market in 2013 in terms of prices, home price appreciation, and sales," he said.

Blomquist said prices rose as investors bought houses, and families got back into the market, though he expects the market to improve more slowly this year.

The president may talk about gains in the housing market and the improving unemployment situation in this year's State of the Union speech.  

When he took office, unemployment centers were busy and the jobless rate was headed above 10 percent.
It took years for the unemployment rate to fall to the current 6.7 percent, which still leaves more than 10 million people out of work.  Four million of them have been jobless for six months or longer, which is worse than previous recessions.  

But recent economic reports show growth, construction, manufacturing, consumer confidence and other important measures mostly improving. They also show the jobless rate heading down in the future.  

Aparna Mathur, who researches the economy at the American Enterprise Institute, said, "The long-term trend suggests we are heading in the right direction. We might reach pre-recession [unemployment]  levels of five percent over the next couple of years “
 
Many economists say presidents usually get too much blame when the economy goes badly - and too much credit when things go well.

The chief economist for the Associated General Contractors, Ken Simonson, said it is mostly private business, rather than the government, that drives the economy. But he said things have gotten better on Obama's watch. "I'm sure that he will take credit for the sharp drop in unemployment rates that we have seen in recent months and for the gradual, but always positive, change in jobs over the last three and a half years."  

Simonson pointed out, though, that the president's Republican rivals certainly will be quick to offer a rebuttal -- and point out that the jobless rate remains higher than what most Americans view as normal.

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