The much-bewailed capital shortage has put several constraints on the flow of funds and has pushed the cost of capital up.
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Demands on global capital include:
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Continuing German reunification costs; Much larger than anticipated Eastern European/Soviet restructuring costs; Middle East reconstruction
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Aging of the Japanese workforce; Need for enhanced productivity to accompany changing demographics
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Huge public pension shortfall in the U.S.
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Developing world privatization programs
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Environmental clean-up and regulation; Public infrastructure in industrialized world
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The general malaise is coupled with more active government. In the U.S., regulators are keeping a tight reign on the broadcast and cable industries, policing the airwaves for indecency and assuring that rates are kept low enough to allow access to almost every American - issues of social value that had re-emerged as health care reform took hold. Also, governments worldwide have scrutinized any information highway investments especially to the extent that foreign trade competitiveness and/or
consumers' or employees' individual rights are concerned.
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