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tv   Your Money  CNN  September 2, 2012 12:00pm-1:00pm PDT

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. you are not happy and you're taking it out on the u.s. economy. i'm ali velshi. welcome to "your money." for starters, the u.s. economy is barely growing. this is about gdp. gross domestic product is important. it is the broadest measure of the value of everything we produce as an economy, and as those bars go up, we feel better. now this week we learned that in april, may and june the u.s. economy grew at a rate of just 1.7%. that means as an economy, we produced 1.7% more value than we did in the same period a year
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ago. that and $4 wi get you a cup of coffee because what that doesn't tell you or me is how americans are feeling about the economy and how your feeling decides whether or not this economy is going to get weaker or stronger. so i have compiled some numbers on the five economic indicators that have the greatest effect on you. think about this as the real feel of the economy. can you read about it in-depth in my column in the current issue of money magazine but i'm going to give you the cliffnotes right now. i've used government numbers from the past 30 years to score economic performance in that time between 1 and 10. 1 indicates the worst level that that indicator has been at over the last 30 years. 10 is the best. so take a look at where we stand right now on the things that you feel. unemployment, above 8%, 4.3 on the scale. personal income, adjusted for inflation at the low end. it's a 1.5 on the scale. because median wages fell last year. that's what happens when too many people are out of work
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pushing demand for your services down making your wages drop. personal savings, the thing that saves you and your family and your house, not that good either right now. i can't tell whether that's because you're not trying to save or whether low interest rates are discouraging from you saving. home price appreciation. home values are finally bottoming out. it is still a 3 1/2 on the scale. there is one very bright spot in the measures. something called industrial production. the increase in what the economy physically produces -- oil, buildings, machinery, airplanes, the stuff that makes you feel like the economy is chugging along, the busy highways, cranes and smokestacks. well, this measure currently scores 7.6 compared to where it's been over the past 30 years. but even that's not cause for celebration because manufacturing is such a small part of america's economy. much smaller than it was 30 years ago. so the average score, the real feel on the economy if all of
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these five indicators, well, a measly 4 out of 10. that is bad given that we're three years out of a recession. but this four is going to seem pretty good if we go into another recession and that could happen if washington fails to act to avert the so-called fiscal cliff very soon. we may be headed lower than this. so did we hear any of that from republicans during the party convention last week in tampa bay? no. we heard speeches. we saw platform about bringing back the gold standard, defining marriage as being between a man and a woman. we did hear about cutting taxes and cutting entitlements. what about jobs? nothing is more important to our economic recovery than job creation. i would have thought that's the main thing they talked about. well, in fact, thankfully mitt romney did talk about that. >> unlike the president, i have a plan to create 12 million new jobs.
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>> are you kidding me? i'll wear a dress for a week if after four years we have averaged a quarter million jobs per month. that is an average. 250,000 jobs a month every month for 48 months in a row. it is not impossible. my next guest is going tell you it's possible much it's possible. but it is highly unlikely. and while i applaud big thinking, there is a fine line between big thinking and saying things so people will vote for you. and the romney camp knows that. joining me to discuss that remarkable and historic disconnect between the republican party and what is going on in america is stephen moore. he is editorial writer at the "wall street journal." he was at the convention. stephen, if i wanted to insure that i was not lying to the american people or making promises that are not impossible to fulfill but are highly
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unlikely, like the promise of 12 million jobs over four years, which is, at best, a cynical effort to win votes by duping unsuspecting voters and at worst a lie, what would i really have to say to do -- to say and do to level with them? >> i'm going to hold you to what you just said. i want to see you wear that dress four years from now and a wig with it. look, i think it is a grandiose promise. that's what presidential candidates do. barack obama said he was going to cut the deficit in half and create millions of jobs. candidates make the promises. sometimes they come true. sometimes they don't. but i think it's unfair to say that he doesn't have a plan. he does have this tax reduction plan to restructure the tax system, make it more pro-growth. he has a plan to cut spending to bring the deficit down. i think his energy policy of more production means more oil and gas jobs here in the u.s. so i think it's achievable. by the way, i want to say. i think it is a good thing when these presidential
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candidates, and i hope barack obama does it too, shoot a target you can shoot for. let's shoot for 12 million jobs. maybe if we only get 10 million we'll still feel pretty good about the economy. >> why don't we shoot for 20 million or 30 million? the point is leveling with them -- you know, the economists which is a relatively economically conservative publication like the one that you do work for called mitt romney's 59-point lan like "50 shades of grey" without the sex. i mean it does need a little bit of meat. it needs detail. can you tell me how you can get to 12 million jobs, i might believe that. in the end we'll hear from alan simpson later on in the show. the market will judge whether this is the case. so let's bring in our friend, mohammed el-erian, the ceo at pimpco, the world's largest bond investor. let's give the mitt romney camp the benefit of the doubt for a moment on creating 12 million jobs in four years, 250,000 jobs a month. you heard my promise that if that comes to pass, i'll wear a dress for a week.
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what would have to suddenly change in the economy that we are in, the 1.7% growth economy to accommodate the creation of a quarter million jobs a month? >> a lot. a lot would have to change, ali. i agree that it's great that jobs are being put as an issue agree with stephen, let's have a target. but right now that target while desirable is not feasible. so what do we need to see? first and foremost, comprehensive structural reforms. create competitors in this economy. that means better labor markets, better infrastructure and fiscal reform including tax reform. second issue, we need up front stimulus. third issue, we need better safety nets. we need to better protect our we need to better put our citizens in this structural transition. finally, the u.s. has to regain transition. finally, the u.s. has to regain the global leadership. we're getting headwinds, not
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tailwinds. and so far romney's platform doesn't get close to taking on this pcess. >> that's interesting. let's bring stephen back in. if the world were not given the u.s. tail winds -- headwinds, if we had tailwinds, then this is possible. a number of conservatives pointed out to me and i'll have another one later in the show, a lot of conservatives on the show. it is conservative week. it is the rnc convention week. a lot of people said we have done this in the past. we had this successful economic growth. we've had that kind of job creation. but that requires a little runway. that requires a little tailwind. that requires things going your way with a highly specific plan. even you will admit, we are not in that place right now. >> well, we're not. you know, i was thinking about this, preparing for this segment. i looked at the jobs numbers in the '80s and '90s under ronald reagan, a republican president, and democratic president, bill clinton. we created nearly 40 million jobs over that 18-year expansion. that is a pretty darn good number.
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what i'm saying, i think is saying the same thing -- is we can do that again. it is true 12 million jobs, 250,000 jobs a month is a lot. we're still 4.5 million jobs short of where we were in 2007, ali. so just one-third of that pick-up in jobs that mitt romney is talking about is just getting back to where we started from. i think it can happen. i agree with both of you. you need an ambitious economic plan. and one last thing. i'm more of a growth hawk than a deficit reduction hawk. that is missing from the republican convention. tell us how you're going to create the jobs. how are we going to get that 4% growth rate? if you do that, the deficit comes down. >> sure. >> the deficit comes down when you put people to work. >> this is where we all agree. growth will solve a lot of the problems. how we get there remains the question. mohammed el-erian, always a
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pleasure to talk to you. stephen moore, great to see you as well. next, a man with a plan but not a nomination. former republican presidential candidate john huntsman had a clear plan. he dropped out of the race in january. he said the gop lost its way. i'll ask him about the party's identity crisis next. there are a lot of warning lights and sounds vying for your attention. so we invented a warning you can feel. introducing the all-new cadillac xts. available with a patented safety alert seat. when there's danger you might not see, you're warned by a pulse in the seat. it's technology you won't find in a mercedes e-class. the all-new cadillac xts has arrived, and it's bringing the future forward.
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smaller, less invasive, less intrusive government, lower taxes, balanced budgets. these are traditional conservative values. the gop has become a party that appears to give an unnaturally large voice to social conservatives, feels exclusive and at times has championed the idea that compromises with those who don't share your views is a dirty word. all of this while there is a chance the u.s. could slip into another recession again. now that's not just frustrating to voters. it's frustrating to real social
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and fiscal conservatives like former utah governor john huntsman who while having one of the strongest economic plans of all of the republican candidates for president, never polled into the double digits nationally. he ended his campaign in january. "the wall street journal" called his economic plan as impressive as any to date in the gop presidential field and certainly better than what we've seen from the frontrunners. what's more, he's also served as u.s. ambassador to china before entering the race. china is the biggest economic competitor but many in the gop ignored how that experience could help our troubled economy. instead, focusing on the fact that he served under president obama. he took a job under a democratic prident and that maybe he didn't say crazy things. john huntsman joins me now. pleasure to see you, governor huntsman. many people looked to you as somebody who has fiscally conservative but have views that
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seem to be in sync with creating economic growth. the biggest challenge of our time right now. why didn't it work? >> well, i'd have to say it was very restive republican base. far more than i'd ever seen before. if you cross a partisan divide as i've done to serve a democratic president, that isn't always seen as a good move if you're going to run for higher office. in the old days, it was seen as something patriotic, something that was akin to putting your country before party which is what i believe in personally. i think the american people want that. in the early primary phases of presidential politics, that is not always looked upon favorably. i think a lot of the ideas that i brought to the forefront that were tied back to what i had done as governor, i thought i'm going to run for president. want to make sure that i got a track record as governor that speaks to what -- >> where you cut deficits?
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you addressed the jobs issue. >> we created a flat tax, for example. we had the number one jobs related economy in the country. we did an alliance with higher education in terms of making the most of our brain power in our state. we reformed immigration. nobody else would at the federal level. all of the things that speak to growth and competitiveness is what we focused on. as a result, the state came to life. i'm here to say that the country is just like a state. the population is larger. the needs are the same. we have to speak to the marketplace in way that's allow us to create jobs, expand the base and we're never going to be able to pay the bills going forward or take care of all of those legitimate needs we have on the social program side until we can expand this economy. >> you didn't end up going to tampa to the convention. i know -- i believe your daughters did. somebody else did. i want to bring in kathleen parker, conservative columnist, a good friend of mine who did
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attend the republican national convention. she's still there. kathleen, i have -- it's great to see you. i pointed my finger at a lot of politicians on this show recently. who do you blame for this disconnect? governor huntsman cas it a restive republican base. who do you blame for this disconnect between some of the nonsense that is coming out of the republican party and some of the real problems that need to be solved in this country that the republican party could be competitive about solving? >> it's hard to put your finger on one person or one group. obviously, the social conservatives are determined to have their message heard over the economic message that governor romney and paul ryan are trying to get through to the people. and by the way, this is a very frustrating thing for a lot of people within the republican party including and especially women who are -- who feel like some of the men in their midst are going out of their way to be aggressively hostile to women. and that's not to say, excuse me, that's not to say that a lot of republican women aren't
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necessarily going for the philosophies, for example, the pro-life positions. but they do feel there needs to be room in the party for differences of opinion. and when you are aggressively building a platform, for example, that declares, you know, life in terms of no exception for incest or rape, things like that, women can't identify with that even if they're pro-life. there's a point where you have to say, look, we have differences of opinion. we are a big party. we have big issues and serious concerns. and these kinds of issues are overshadowing and blocking and distracting from the very message that the nominee wants to get across. it's so interesting. the narrative of the democratic party has advanced. it is now the narrative that republican party is also advancing. with the exception, i should say, of a nominee himself.
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i don't think he cares one wit about this conversation and doesn't want to have it. >> i heard that. >> it won't be discussed. >> i heard that from people. i heard that from women who say very frustrated with the platform. frustrated with the todd akins of the world. they don't think mitt romney's part of that. how do you reconcile this very key message that republicans want to put forward and fiscal conservatives put forward that government get out of my way so that the economy can do well except government gets in the way whether it comes to many of these social issues? >> well, that's the question dujour, ali. you can't reconcile it. you either believe that the government stays out of your personal business or you don't. you can't sort of hand-pick and choose which of those things the government is going to intervene on. that's why republicans lost a lot of women support both within and without the party. some of the women i spoke to for recent piece i wrote for "newsweek" magazine specifically said, you know, we feel like
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these people are no longer on our team. they're no longer listening to us. and women within the republican party and the congress and senate are actually now organizing to have their voices heard and to try to offer some balance to the perception that the republican party is anti-woman. >> we're going to talk a little bit about tlou broad ee ee ee e message and broaden that base in the face of scathing criticism. governor, stay right here. kathleen, great to see you. the column is remarkable read. very insightful. i appreciate it. kathleen parker from the republican national convention. okay, up next, why the word bipartisanship is a campaign killer on the path to the presidency. go ahead of him and win fifty thousand dollars. congratulations you are our one millionth customer. people don't like to miss out on money that should have been theirs. that's why at ally we have the raise your rate 2-year cd. you can get a one-time rate increase if our two-year rate goes up. if your bank makes you miss out, you need an ally.
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former presidential candidate jon huntsman is a two-term republican governor from utah. he didn't attend the republican national convention this week because he thinks his party has lost its way. huntsman entered the race last june with solid ideas to turn is economy around, a resume to back them up and a tone of
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compromise for the greater good of the country. but in this republican party reaching across the aisle, setting aside some differences for the good of the country is a no-win situation. john huntsman rejoins me now. why are you not -- tell me in your words. i just characterized it. why didn't you go to tampa? >> let's face it. it's governor romney's show. let's face it -- it ought to be. he earned it. he deserves it. and his team is there. they're doing their thing. that's the way it ought to be. i've been to every convention almost with the exception of maybe one since 1984 when i was a reagan delegate. i have to tell you, increasingly when you have a party that lacks inclusiveness, that is not focused on real solutions and delivering the bread and butter bottom line issues that american people are looking for, that lacks the sense of optimism and the big picture strategic thinking about america's role in the world, all of that is so desperately needed today. and my comment when asked is as soon as my party -- as i know it
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will -- returns to that sense of inclusiveness, that big bold confident optimistic message about broadening the tent and our role in the world which is always been a confident role, we don't articulate messages based on fear. we articulate messages based on opportunity. >> governor, all the messages in this campaign have been about fear and why the other guy's worse. we really ha. look, i know this has been going on for years. i know these are effective techniques and campaign strategists have mastered that. it almost seems like you ran a campaign absent of those cynical strategists and didn't get you anywhere. >> lesson learned. if i had to do it over again, i'd do it the same way because that's who i am. i think it's what most of the american people are -- >> then you'd lose again. so when you say and kathleen says -- >> you probably answered whether i would ever do that again. >> that's the sad part. i spoke to a woman this week, a pro-choice republican woman who used to have to go to the conventions with bodyguards and
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she says she measures success she didn't have to this time. i say why do you bother? why do you go back? she said because it's my party first. i don't want these fringe issues taking over my party. so in some ways you not being engaged or you not running again says they won. >> well, no announcements here, obviously. but what we must do, we must expand participation in the party. we've got to figure out somehow, some way what to do about highly exclusionary early caucuses and primary events. so if you got a fraction of the population turning out in the early states at the exclusion of the majority who would otherwise feel differently about the issues, that's not our democracy in action. and i'm here to tell that you if we can break open the level of participation by people by going to direct primaries, by somehow making it easier for people to vote -- for heaven's sake. here we live in a world of high technology. everything is on an ipad. everything is done on ipad except voting.
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it still takes you a week to register at the county commissioner's office. it's total nonsense. we ought to be taking the ability to participate in our democracy directly to the people and saying, forget about the caucus process, forget about the eccollusionary meetings that tend, i think, to gum up our democracy. let's move to direct primaries. let the candidates speak out on the issues. get big money out of the way. i'm also of the opinion that the super pacs are completely destroying politics. >> you're a man of the world. you've seen other countries where they have campaign limits in terms of the time that you can campaign, the amount of money that you can spend. yet people manage to get elected in all of these countries. why can't america do that? >> well, we can, if we set our sights on it. it's all part of addressing the trust deficit. so we have a fiscal deficit to be sure. we have a trust deficit, too. and it's a lot of young people in particular in this country who are losing faith in the direction of their democracy. and they're doing so because too
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much money. incumbents always get re-elected. and the lobbyists play too big a role in the process. >> good to see you. thank you for joining us. >> thank you. it's a pleasure. next, u.s. government debt continues to spiral out of control and washington needs to do something now. simpson bowles. >> i cannot tell you how many republicans and democrats have jen u flekted at the altar of bowles-simpson. >> i'll speak with the architect of the plan that both sides of the aisle are talking about but nobody's doing anything about. that's next on "your money." mom: ready to go to work?
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in 2012 aalone, the u.s. deficit is projected to 1b$.1 trillion. to put that in perspective, if you spent $1 million a day, it would take you 3,000 years to reach that number. now this isn't the deficit. the deficit is the yearly budget short fall. the debt is the accumulation of all the deficits and the interest owed on it. america's debt is upward of $15 trillion. you are going to continue to hear calls from everybody who is
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running for office for a bipartisan plan to tackle the debt. except we have one. it's called simpson-bowles colloquially and it is nearly two years old. it was ordered by president obama. it was called the national commission on fiscal responsibility and reform. it was made up of 12 members of congress appointed by their party leaders. it also included six non-elected officials appointed by president obama. the first one was allen simpson, former republican senator from wyoming and erskine bowles who used to be the chief of staff to president clinton. hence, the name, simpson-bowles. now it put everything, everything on the table and the result was a truly bipartisan plan to reduce america's debt by $4 trillion over ten years through spending cuts and tax reform. now you can see that green line is sort of where our debt is going over the next decades to come. and if the commission's
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proposals are followed, that is the blue line. that's what would have happened. under the six-step plan, federal workers would have been subject to a three-year pay freeze and the commission would also reduce the oversaul size of the government workforce through attrition. the comprehensive tax plan involved would lower personal income and corporate tax rates while broadening the base of people who pay taxes. capital gains and dividends would be taxed as ordinary income. now back door government spending for certain industries would also be removed. things like the government subsidies for the ethanol industry. a portion of the money raised there would go directly to paying down long-term debt. now as i said before on this show, health care is one of the fastest growing costs to the u.s. government. simpson bowles would establish a budget f
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budget for health care spending and cap the amount that doctors and insurance companies have to pay out in malpractice lawsuits. mandatory practices would be adopted from the private sector to streamline the federal workforce retirement programs, the post office, student loan subsidies and other government programs. social security would be reformed as well. among other things, simpson bowles raises the retirement age from 65 to 69 by 2050, and asks those who earn more to contribute more. what about congressional negligence? laws would be established to make sure spending hurdles are met. penalizing congress if it fails to meet the goals. now in order for simpson-bowles to have made its way to catholic, it needed something called a super majority vote. that's 14 out of the 18 members had to approve. this was to assure that it had bipartisan approval. now here are the number of people who voted in favor of it. five republicans, five democrats and one independent. seven who voted no included four
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democrats and all three house republicans including vice-presidential candidate paul ryan which is odd considering ryan decision to take on president obama during the republican national convention this week. >> he created a new bipartisan debt commission. they came back with an urgent report. he thanked them. sent them on their way, and then did exactly nothing. >> i spoke with former senator allen simpson, the co-chair of the simpson-bowles commission. the first question i asked is if paul ryan's comments upset him. >> well, nothing much upsets me at this stage in life. i've seen it all. we went to ryan afterwards and hensarling and kemp. i said to them, look, did you vote against this because you were scared to death of grover and norquist that he would beat you over the head with a club while he is wandering the earth in his white robes?
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he said no. he said we voted against it because if you get rid of employer health care premiums, the employers are going to be stunned and look around and say what do we do now and they're going to bloat obama care further. they're going to take their people into the new health care plan. that was their response. that's good enough for me. he can explain himself. he had his reasons. look at durbin, gutsy guy. i mean durbin is the assistant leader of the democrats in the senate. think what harry reid must have tried to do to him. good god, you're messing with precious medicare. >> we need gutsy. >> we need that leadership. >> sure. but you're not getting any guts out of of anybody. >> simpson-bowles is a token now that anybody talking about debt or deficit throws around. they actually like it. they say i like simpson-bowles. politicians are doing this. mitt romney's campaign said the plan mimics yours. i don't think it does. he wants to cut rates across the
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board. that's where the similarity ends. doesn't raise any revenue. do you agree with your fellow republicans who say we don't have a spending problem -- we don't have a revenue problem. we have a spending problem. >> sure. we also have a revenue problem. we've never had less revenue coming into the united states since the korean war. wake up. 15.2% of gdp is the revenue. it's historically been about 19 or 20. so you can't tax your way out of this baby. you can't cut spending your way out of this baby and you can't dream your way out of this baby. you got to get in and do all the heavy lifting. and they won't do it. they being everyone running for public office before november 6. between november 6 and december 31st will be a whirlpool, a cesspool of $5 trillion to $7 trillion floating around in there. if you go too far, you throw
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into recession. if you go too little, you throw it into recession. merry christmas. it's going to be a lot of fun from now until december 31st. >> from your lips to the voters' ears, senator simpson. a pleasure to hear your straight talk, as always. thanks for joining me. >> sounds like a horse whit perrer in there. fix the is the website. go to it if you want more information on the simpson/bowles plan or if you would like to sign senator simpson's petition calling on congress to pass a comprehensive long-term plan by july 4th, 2013. while you're online, visit cnn's america's debt challenge page to see the coverage of this critical issue. up next, former labor secretary robert reich says the gop's economic plan is a disaster that will actually cost millions of jobs, not create them.unds ying for your attention. so we invented a warning you can feel. introducing the all-new cadillac xts. available with a patented safety alert seat. when there's danger you might not see,
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mitt romney has not provided much dail for his 59-point economic plan. the economist refers to it as 50 shades of grey without the sex. but his running mate paul ryan has one of his own and he has outlined a little bit more. former labor secretary robert reich, you see him here, has served under president clinton and he thinks the paul ryan plan
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is a disaster. joining me now, robert reich, chancellor's professor of public policy at the university of california berkeley. he's also the author of a best-selling ebook "beyond outrage: what's has gone wrong with our economy and democracy and how to fix it" available in paperback on september 4th. he is a prolific writer to one of many books he has put out. bob, good to see you. thank you so much for being with us. you tweeted me that video. paul ryan echos mitt romney's ridiculous claim they would create 12 million jobs in four years if elected. now the trick here, bob -- you were labor secretary. the trick here is if that were true, then that would be a deciding factor for most people. they can provide 250,000 jobs per month on average for 48 months, that is a dealmaker. w you say that paul ryan's plan, the one that is more
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detailed and is out there, will lead to millions of job losses in the next two years because it would send america into that european style austerity trap. explain that please. >> yes. the ryan budget does incorporate the fiscal cliff in the sense that it requires massive cuts in spending right away. basically, next year and the year after and at a time when we have so much unemployment and we have so much underutilized capacity, that's exactly what we don't need. that's exactly what europe got into the problem with. when you cut that much, when you have so many people unemployed, that means more unemployment, less economic activity. and that in turn means that the ratio of your debt to the total economy is going to get worse and worse because your economy starts contracting. that's what europe is facing. that's what paul ryan is going to do to the united states if his plan is adopted. >> so people are probably tweeting right now to say robert reich is a liberal. of course he's going to say that you can't cut things right now. but clearly our debt is a
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problem. our deficits are a problem. at some point we're going to have to cut spending. when is that point? >> i would suggest that we have a trigger built into the law, democrats and republicans both have to abide by it. they build it into the law. that when unemployment gets down to 6% and we have growth at about 3%, that trigger means we have major severe cuts in spending and also tax increases to deal with the long term budget deficit. that means we can be back on the path of growth before we do the cutting. that's the proper sequence. this is a matter of sequencing. it's not a matter of democrat versus republican, liberal versus conservative. it's a matter of doing it in the right order. >> all right. bob reich, good to talk you to. thanks very much for joining us today. robert reich is a professor of public policy at the uc berkeley. coming up next -- big numbers, big night. dueling debt clocks were center stage at the republican national convention. mitt romney only said the word debt once in his speech.
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does he have a plan to dig us out and create those 12 million jobs in four years that he keeps talking about? we're going to ask one of his economic advisors. wówóvó9ñ [ male announcer ] if you stash tissues like a squirrel stashes nuts, you may be muddling through allergies.
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the republican party is obsessed with the mounting debt in this country or at the very least talking about the mounting debt in this country. christine romans joins us now about this. you saw that debt clock. >> two of them. two of them. two of them at the republican national convention this week. two debt clocks. both of them keeping track. one of the lasting images of that convention, the two giant clocks counting down america's debt -- are counting up america's debt. the other shows the total amount the government owes. it owes $16 trillion. astonishing. you won't hear the republican backed policies that helped run up these clocks. here are official government statistics, visualized by the center on budget and policy priorities. take a look at this.
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this is our debt. it is the size of our economy. right? look at this. this big chunk of debt here, these are the bush tax cuts right there. bush tax cuts. that much of the debt are the bush tax cuts. these are wars that began before this administration. right here this blue slice right here, this is the crisis. it is slamming the american economy. when growth stopped and in fact contracted, it added to all of this debt. you see this little thing right here, this little blue line? right there. that is t.a.r.p. fanny fannie mae and freddie. this is the stimulus right now that so many conservatives hate. and this is all of this other debt that we were already piling up that's outside of this. if all this stands as is, the projection is by 2019 debt will account for more than 80% of our economy or nearly all the goods and services this country produces in one year without these programs many of which were backed by republican lawmakers, we would be right down here at less than 20%.
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>> all right. i want to bring in kevin hasset, an economic advisor to mitt romney, a senior fellow and director of economic policy studies at the american enterprise institute. we we are critiquing a lot of things that the republicans have been doing and inviting a lot of republicans on to the show to set us straight. as christine poted out there was a focus at the convention on the ballooning national debt. was it fair to hammer the president and the democrats on that growing tab given what christine just described to us that a very, very large part of our debt and deficit in this country is a result of gop policies? >> well, i mean, it's a debt that has been built up over many years. of course there are many policies that contribute to it. if you look at the increase in debt under american presidents then president obama is way out
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in first place with something about 27% using the numbers you were looking at. second place was ronald reagan in about 14% and third place was george w. bush. the debt increased massively under president obama in part because of the stimulus. obama and the democrats extended the bush tax cuts. if you say that is somebody else's policy they say they are destroying the economy but they refused to let them expire. so i think that president obama most importantly really dropped the bowles-simpson commission. we pushed that because of the things that happened. we pushed the debt to really high levels. when it gets that high it is bad for growth. it is something you talk about a lot. he had a commission that came up with a pretty good plan and he dropped it. i think that is why it is fair to attack. >> i agree with you on that. we spoke to allen simpson and
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reminded everybody that paul ryan who pointed out that president obama basically dropped simpson bowls voted against it. he was one of the people on the committee and voted against it because it wasn't perfect. that wasn't the right thing to do. >> it wasn't up on capitol hill. they didn't submit it as a vote because president obama didn't really work with everybody on the hill to get a plan that people could come behind and support. what needs to happen is you need to have a president that works with members of the other party and comes up with something that he says is going to be gold and pushes it through congress. president obama hasn't done that. if you walk around into the buildings here in washington where you have economic staff they are all idle. president obama people say he is the policy. he never gets that engaged in policy. we have never had a point where the white house said here is a bill i have been negotiating with paul ryan and the republicans. we have written it up in the legislative language at the
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treasury. he has delegated the policy construction to the people on the hill and that hasn't worked very well because congress has been broken. >> i knowou are responsible for part of the romney plan. i keep bringing up what part of the economist said about mitt romney's 59 point economic plan and said it reads like "fifty shades of grey" without the sex. when you look into that plan some of our studies over here indicate that it could end up costing jobs rather than creating the 12 million jobs over four years that i think you are party to writing. >> i don't see how that can be. the fact is that we have this massive deficit and massive debt and that creates a lot of uncertainty and makes people weary. we have the highest corporate tax on earth. that makes everybody want to locate activity offshore. governor romney wants to get
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ahead of the curve and doing so nat balanced manner so it is not a big revenue reduction. i think having lower marginal rates and certainty because you are ahead of the curve on the deficit i don't see how that can fail. where is rice coming from saying higher marginal rates -- >> i know you don't share a lot of information with the american policy institute. they say paul ryan's plan, his plan may mean 1.3 million fewer jobs in 2013. 2.8 fewer in 2014. we just got the news from spain that they have 25% unemployment. the fact is the danger you get yourself into this trap at a time when people aren't spending money. you get yourself into the track where it is important that government doesn't spend money. people don't remember that cutting government spending means laying off government workers. more people receiving government assistance.
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>> i think the real risk and it is where we are now is that you can get into a death spiralal where you are dependent to repeated stimulus and not addressing the big problems that can move us forward. the people listening at home know if they save a bit this year and next year they have money in the bank. the same is true for a country. we are taking those pennies that americans are saving and putting aside so they can have a secure future and the government is borrowing that and spending it right away so we are not saving for the future. if we don't have more assets to draw from in the future we will not have growth and will not create jobs. president obama's deficits are destroying jobs and governor romney has a proposal to reverse that. i don't see how anybody can argue anything else. >> always a pleasure to have you on the show. senior fellow and director of economic policy studies at the american enterprise institute
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and an economic advisor to the mitt romney campaign. we have been hard on the gop in this show. i can hear you typing out furious messages to me on twitter and facebook. listen to what we will be doing next week. i will tell you about it after the break. ♪ [ male announcer ] its lightweight construction makes it nimble... ♪ its road gripping performance makes it a cadillac. introducing the all-new cadillac xts. available with advanced haldex all-wheel drive. [ engine revving ] it's bringing the future forward. it's bringing the future ♪ (train horn) vo: wherever our trains go,
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the economy is growing. that is what the numbers tell us but you are not feeling it. you drive the economy and it can't grow unless you feel confident. you won't spend unless you are sure that you will continue to have an income. we are producing more goods but that is only a small fraction of our economy. wages are stagnant and you are not saving money. with the fiscal cliff looming there is a danger we could slip back into a recession. the only economic message we heard from the gop was a relatively dishonest claim about job creation. we were hard on the republicans this week. it was their convention and we are holding all sides to the truth. next


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