At a recent conference that attracted a number of Wall Street and corporate luminaries and leading economists, former Federal Reserve Chairman Alan Greenspan said he believed that interests rates around the world would not stay as low as they are now. "The cost of capital is not going to stay down at this level," he said.
He said that while lower corporate tax rates can boost productivity, it was unlikely that the political system in the United States would support such a move, especially after the baby boom generation begins to retire, causing big increases in government spending for Social Security and Medicare.
He said this opposition will occur even though economists widely agree that lower corporate tax rates can boost jobs by increasing productivity.
"Regrettably, there is still a great deal of populism in this country," Greenspan said.
