The Economist points out that corporations are more nimble than governments with regard to their financing. Because businesses are transnational entities, they can seek the lowest-cost domain for raising capital. Businesses also have flexibility in terms of how to finance themselves. In contrast, there is no equity financing for governments except that each citizen gets a single vote/share.
What does this mean in the long run? It’s anyone’s guess. But businesses, hopefully, will start to refinance themselves just as consumers have done the world around, thus lowering their borrowing costs and increasing net income. Then, when a project comes along, they will have internal capital to spend on the project, thus reducing corporate cash balances, which, as I have argued, are a drag on economic growth. That in turn should lead to job growth and capital spending.
The wheels of capitalism do turn, but in times of economic duress it is hard to escape the mud.