Friday, October 25, 2013
September capital goods orders were weaker than expected, and have been sluggish since the beginning of last year. This measure of business investment is hardly impressive, and reflects a chronic lack of confidence on the part of business. With corporate profits at all-time highs, but business investment in capital goods yet to surpass pre-recession levels, it's not hard to see why the economy has been growing slowly. Businesses could be doing a whole lot more, but for a variety of reasons—burdensome increases in regulations and higher taxes, to name just a few—they have been reluctant to invest in the future. The U.S. has the highest rate of corporate income tax in the developed world, the onset of Obamacare has placed additional and heavy burdens on small business, and Dodd-Frank regulations have added huge burdens to the financial industry. Government needs to get out of the way if the economy is to proceed at a faster pace.
Posted by Scott Grannis at 4:56 PM