Potholes in the Road to 3% Growth

The US economy can grow 3% in 2015. These factors could hold back growth: © The economy needs consumers, but they're hanging on to the "oil dividend" created by plummeting gas prices. 2014 Consumer Price Index (% change) +0.1 -0.2 +0.1 0.0 |-0.3 November -0.4 December July August September October Source: US Bureau of Labor Statistics Income inequality can slow growth. Employment for less-skilled workers has been falling since 2000. Total Employment By Skill (January 2000 Normalized to 1) High School or Less Some College College or More 1.4 1.3 1.2- 1.1- 1.0 0.9 0.8 Source: US Bureau of Labor Statistics; Erik Hurst, University of Chicago Booth School of Business O Corporate investing is lagging. US companies hold more than $2 trillion in earnings overseas to escape the US corporate tax rate, third-highest in the world. These are general corporate tax rates. Many countries have targeted rates that differ. 55.0% 39.1% 37.0% 34.4% 30.6% United Arab Emirates France Worlwide Weighted Average United States Japan Source: Tax Foundation © Higher corporate taxes are part of President Obama's proposed $4 trillion budget for fiscal 2015. The 33 percent spending increase aims to boost the economy. US GOVERNMENT SPENDING Receipts Outlays Deficit FY 2014 $3 trillion $3.5 trillion $500 billion % of GDP 17.5 20.3 2.8 FY 2013 $2.8 trillion $3.5 trillion $700 billion % of GDP 16.7 20.8 4.1 Source: US Treasury Department CHICAGO ВООТИ