tv Your Money CNN October 23, 2011 3:00pm-4:00pm EDT
>> myth mitt, you lose all of your standing from my perspective because you hired illegals in yourome and you knew for -- about it for a year. >> rick -- >> rick perry goes after mitt romney, but romney doesn't leave it there. one hour of politics beginning at 4:00 eastern time. i'm fredricka whitfield. stay with cnn. "your money" starts right now. president obama on the road this week pushing his jobs plan but is he fighting for your job or campaigning for his own? welcome to "your money." i'm christine romans. ali is off this week. joining me ken row gaffe, kris ya freeland and economist steven moore. want to start with the president traveling through key battleground states on an official trip, wants to push congress to pass every part of his job act piece by piece. what is this about? whose job is he looking for? >> won't be surprised. my view is that if he had really been serious about wanting to pass a jobs bill this year, i
think he could have if he moved more to the middle might have been able to get something through congress. once he started talking about a big tax increase on the rich, there's no way republicans were going to go for that. i think this has become a political debate not a debate about what we can pass right now. that's a problem when you have 14 million unemployed people. >> didn't the summer teach the white house there was going to be no consensus and trying to do a deal, trying actually to move to the center is what the white house tried to do over the debt ceiling isn't going to work. if you talk to people at the white house -- precisely for that reason you talk to people at the white house they say actually we really tried hard to do a deal and we think it's a huge mistake because the other side doesn't want to bargain and that's what the president is hearing. from his base. >> they did make a deal on the budget. >> not a meaningful deal that moves economic deal. >> economic warfare, tax the rich that's not a bipartisan consest senses.
>> he's changed. to say that the reason he hasn't been able to pass his policies is because he hasn't sought consensus is just not accurately reflecting what he has done. >> there's nothing in that package that republicans really like. >> not now, but that's because he tried to reach consensus and there was nobody on the other side of the table. >> he got a big applause for making that point. that's something his supporters want to hear he's the one moving and they're not moving with him. want to talk about a component of that bill, the senate blocked a component of the jobs bill aimed at jobs for teachers and first responders. the president made it very clear that if republicans in congress don't pass his jobs proposals they'll have to answer to the public. >> it's these proposals. if they say no to steps we know will put people back to work right now, they aren't going to have to answer to me, they are going to have to answer to you. >> this is for chrystia, even if the president gets parts of his jobs bill through congress going forward he's facing record high
levels of pessimism. according to a cnn/orc poll, 59% of americans think the president's policies will fail. is he better off running on his policies or gridlock in washington? >> i think he has to run on his policies but i think it is really, really tough. i think for him to run on gridlock, which is a little bit what we're seeing and also trying to blame the previous administration for the economic problems, i think that's going to be really difficult, because people are going to say you've been president now almost for a full term. >> he also -- >> you own the economy. >> he ran as a uniter, not a divider. >> what he's saying is uniting hasn't work. i haven't been able to do anything. but at a time when the economy is in such really, really dire straits, i think that's going to be a really, really tough sell. >> bring in ken, fed out, the beige book. we love the beige book. our economy is not in recession but losing steam, not doing anywhere near what we would like. are there pieces of the president's job plan that could help the situation or does it
not matter because the politics have made it impossible? >> i don't think anything in it is a game changer but clearly something like extending the payroll tax cut might make sense. i do think -- stephen wrote a good piece how we really need to think about something different here, new tax policy, new way of approaching things. we are in for a long period of slow growth. it's not just about what's going to happen this year but what is our future, where is america going. that's what we really need to see at this point. >> the very near term do you think we've averted double dip recession. there have been little bright spots, so little not terrible spots. is how i'll put it. jobs number not as bad, philly fed index this week that showed more activity than people thought. have we averted a second recession or is it too minuscule? >> as you know, christine, i don't think we ever left the recession in a meaningful second. carmen and i call its second great contraction. is it going to get worse?
i think the norm is we have slow growth for an extended period. there's more healing and deleveraging. i'm very worried about europe. that's hanging over our head. we're not very strong. our banks aren't very strong. that's the big risk. otherwise f they solve that, slow growth until there's a game changer. >> can i ask one question. >> you are the guru of financial crises and how historically economies have recovered from them or not. is this kind of economic winter just inevitable and should everyone have said at the beginning of 2009, okay, we've screwed things up. history shows it's going to be seven years before things get better? >> i'm afraid the answer mostly is yes. there are things you can do -- >> you've said that repeatedly. >> yeah. you certainly want to take aspirin when you have a fever. >> you don't want to do anything that makes it worse. >> you don't want to do anything worse. you want to understand this is going to last a long time, don't want to panic. you want to look forward and ask how do we get back on our feet,
how do we have a good decade. there was an idea we could jump-start everything, big stimulus, government, private sector will take over organically, go away. that i don't think -- >> that's not going to work. >> i disagree, you and i have had this discussion. i think if we had done structural things that need to take place with respect to changing the economy in 2009, we'd be in much better shape now. the reason i'm kind of against this stimulus, too -- these are -- >> the president's jobs bill. >> putting a band-aid on a cancer patient. i think ken and i are in total agreement. the problems are much more structural than just these temporary infusions of government spending. >> i think -- but putting the band-aid on the cancer patient or maybe giving a treatment to the cancer patient, you've got a lot of people really suffering. maybe if you can give the argument from the white house, you've got to do something to alleviate suffering while we wait for the cure somewhere else. >> yeah. and i think there is a really important question about actual human beings and human lives.
the thing i'm worried about the most in terms of the winter theory of what's going on is what happens to the generation that comes of age during winter. the research about young people who enter such dreadful jobs market never get a good first job. that's scary. i don't think you want a whole generation whose future prospects for 10, 20, 30 years can really be stunted. >> ought to be things like first of all, the housing. what do we do about housing. if you're going to run a deficit, do something dealing with that, thorny. education, what to do with 25% unemployment among teens. it's high among 20 to 25 years old. try to have something to bridge that, perhaps. the vision ought to be long-term not that we're somehow solving the short-term problem. >> let's talk about tax reform. that's not thorny or long-term. we're going to talk about that
in a moment. thanks reform is a very big issue. it was all about herman cain's 9-9-9 plan. now rick perry is talking about a flat tax. would it be good for you? is this the time for major tax reform? is that something that could jump-start the economy? we'll take a look at that next on "your money." no idea. let me see that. that's a honus wagner autograph... the hall of famer? look at this ball! yeah, found that at a yard sale. i thought pickles would like it. [ dog barks ] that a new car jerry? yeah... sweet, man. [ male announcer ] the audi a8. named best large luxury sedan. ♪ [ male announcer ] the audi a8. named best large luxury sedan. where they grow america's favorite wpotatoes. idaho, everyone knows idaho potatoes taste great.
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republican presidential candidate governor rick perry announcing this week he wants to overhaul the tax code with a flat tax. in his preview of his economic plan flat tax proposals are not new. they have failed to move voters in past elections. this time will it work? >> many, many years ago i worked with steve forbes in 1996. >> oh, yeah. >> he was a little bit ahead of his time. >> i think he's advising rick perry. >> i do think the time might be right. you need one of those situations where the stars are finally in line to get this done. the flat tax puts all the lobbyists, all the tax accountants and all the special interests in washington out of business. it gets rid of deduction, postcard tax return, very popular with people and gets rates down low. maybe given the crisis we're in
the time might be right, perry talking about next week coming out with some version. >> what do you think, flat tax, does it help the economy? >> i love the flat tax idea. steve forbes version was good. an earlier one jerry brown had. one stanford professor. it's a spectacular idea, can you imagine having the tax form be half a page, no bothering with accounting and lawyers and all the different things. i think it would be a great idea. it's a big change. some countries have done it. i think it's worked really well. we need a game changer, we need something that gives us growth. some of it you can't control. somebody will discover something, the next steve jobs. we hope that will done. -- come. what can washington do? this is something washington can do if they do it the right way. >> let me say one last thing. if we had the 18% rate or whatever it is, i think on a competitive basis around the world, it would make america a very competitive place.
>> yeah. give us another -- >> jobs would come to the u.s. >> why doesn't the united states do this. >> returning to the conversation, steven and i were having at the beginning, i think tax reform and tax simplification, even if it's not as perfectly simple as a flat tax, i think that's an area where you could have some real bipartisan support. one of the things you're seeing on the left right now, the grassroots left is a sense that big business and vested interest has been successful in gaining what stephen was talking about. the tax code has been a way that gaming has happened. >> we found something we can agree on. >> i like it. >> that kind of simplication -- >> they can lobby -- >> one of the reasons you've got the warren buffett problem, because who takes advantage of all these loopholes, rich people. >> it's why you have the problem. >> here's simple and maybe it's why herman cain has been doing so well in the
polls there's nothing more simple as three little numbers, 9-9-9. we know this week he modified 9-9-9 for people below the poverty line to 909, taking away that income tax, they would pay no taxes if they were below that income level. is this why it's resonating because it's simple? >> yes, i think simplicity is appealing. right now. i think what's also appealing is something the professor has been saying, which is, people know that this is winter, people get that. the historical research shows it, people see that in their lives. people i think really want something new. they want a new idea. they do feel there needs to be some game changing political transformation. i think this is appealing. i think with herman cain the difficulty is going to be as time goes on and people test, is there anything behind 9-9-9. the world is a complicated place. >> yeah. >> >> it's great -- i want to say 911, because that's what i want
to dial with this economy. >> that could be your plan. >> rogoff's 911 plan. >> it's a muddled version of the flat tax. the flat tax is beautiful. this is not. it has a lot of problems. i give him a lot of credit for seeing the vision. let's make it simpler, do something people will understand. i don't think it's quite the right way to do it. >> i think it was senator tom coburn wouldn't it be nice to give a number for congress, the tax code will expire. march 31st. find something to put in its place. is now the moment to do that? we talked about real tax reform. is it really now the time to do it? >> now would be the best possible time. >> which means they won't. they will not. >> you don't know. i'd much rather we channeled all this anger with the tea party, with the occupy wall street, channel all this anger to something constructive. i'm worried if we don't we're
going to get a game changer, a trade blocking regulation. something. >> we did this in 1986. that's the amazing thing. we had a total bipartisan consensus for cleaning out the tax system and lowering rates. that bill passed 97-3. >> it's not as radical as this. >> it was a big directional change. >> it depends on the white house. the president has said it's okay with me to be a one-term president if i can get big things done. so this is a moment when he could really roll the dice on this. another game changer i think is essential, which he tried to do is health care. >> well, he got -- >> if health care isn't fixed and i don't think this reform fixed it. >> he got things done his critics don't like, health care done, a big stimulus done. they said you've had your chance, mr. president and we still have 9.1% unemployment. that's it. >> obama care. >> oh geez. here we go again. another five-minute block.
thanks so much. nice to see you guys. have a great weekend. occupy wall street. two guests, two different opinions. both witnessed the protests firsthand. one sides with the protesters, one doesn't. both sides next. we're century. a new kind of broadband company committed to improving lives with honest, personal service, 5-year price lock guarantees and consistently fast speeds. ♪ ♪ ♪ co-signed her credit card -- "buy books, not beer!" ♪ but the second that she shut the door ♪ ♪ girl started blowing up their credit score ♪ ♪ she bought a pizza party for her whole dorm floor ♪ ♪ hundred pounds of makeup at the makeup store ♪ ♪ and a ticket down to spring break in mexico ♪ ♪ but her folks didn't know 'cause her folks didn't go ♪ ♪ to free-credit-score-dot-com hard times for daddy and mom. ♪ offer applies with enrollment in freecreditscore.com™. so if i didn't know better i'd say you're having some sort of big tire sale. yes we are. yeah. how many tires does ford buy every year?
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i tell you what i can spend. i do my best to make it work. i'm back on the road safely. and i saved you money on brakes. that's personal pricing. occupy wall street, lots of anger from the protesters, lots of questions from those observing the movement from outside. we're joined by two men who observed these protests firsthand. will cain, matt taibbi, contributing editor with rolling stone. matt, you say you love these protests, but you want to see the movement focus on a few things. what are they? >> first of all, i don't think it needs to focus yet. what it's doing right now is just getting bigger is an end in itself. they have been tremendously successful at that. everyone around the country is asking what do these people want so we can give them something and make them away. the longer they wait to announce specific demands the more people will be willing to give them. right now growing is an important goal.
when it comes down to time for specifics, they should settle on one or two simple things. for me the big suggestion would be break up the banks. that's something that already had a lot of support in washington, a massive show of force could actually achieve that. >> break them up, make them smaller, make more of them. >> make it so there are too big to fail companies. if a company is too big to fail, it's too big to exist. we cannot have this unhealthy situation where goldman sachs, citibank and bank of america have implicit support of united states government it's not fair to the rest of the world, smaller regional banks, unhealthy situation and taxpayers should not be on the hook for those businesses. >> what did you see driving this? what did you see there? >> one thing i'm going to challenge matt on, i don't think people are asking occupy wall street protesters what they want so they will go away but so we can have a focused conversation and make it better. matt has written on "rolling stone" and i read matt's five potential
demands, one is a suggestion to wall street, break up the banks. i would almost describe to every one of his pieces of advice, including break up the banks and defend each of matt's perspectives from a free market perspective. my conclusion is different. i don't like what i see. at occupy wall street. it's not what matt wants to demand. if you give them all five, nobody is packing up a sign and going home. >> that's one of the things. there are a lot of people who say i love the idea of occupy wall street the movement. the movement says don't take your liberal world view and put it on us. we're not a package for how you think the system should be changed. >> well, but i think they are right to not define themselves yet. what's happening, all these people are trying to speak for the movement and trying to coral them and put them in a box and find leaders they can negotiate with or identify as head of this movement by not having a specific set of demands or structure, it's got everybody
guessing. >> what do they want, i guess? it's anxiety against the economy. everyone has got that. is it middle class uprising or a lot of people who felt like they haven't had a voice and bringing it together but what are they asking for? >> it's an uprising of everybody except a small group of people who -- yes. >> the 1%. >> exactly. almost everybody there is responding to the same thing, a sense of growing inequity not only in income but political power in this country. this idea there are 400,000 people here deported millions of people foreclosed on with the help of law enforcement and not a single person went to jail for the financial crisis. >> we've heard prominent democrats including president obama empathizing with the occupy wall street movement. listen. >> i think people are frustrated. the protesters are giving voice to a more broad-based
frustration about how our financial system works. >> so democrats, do they deserve to have the protesters behind them with the ballot box? do you think this will become a political movement for the president? >> absolutely not. if you look at the history how we got into this mess, this financial crisis, the democrats have been worse than republicans. >> why? >> they have hands on repeals, the modernization act which deregulated derivatives market. >> lowering standards for home ownership. >> yeah. okay. >> that's actually a very contentious part. of the whole story. >> to me that's a peripheral. >> to the wall street part. >> right. look, their chief architects of the bailouts, you know, since 2008. they have their hands on everything. obama surrounded himself almost entirely with wall street people and they've been the architects of his economic policy. there's no way people should have any faith in the democrats. in getting anything done. >> you mentioned something before we went to that sound bite, you don't like what you
see down there. why? >> i think what i see down there, looking for some commonalty, difficult to find it, as i spoke to people, they all want something different. one commonalty, i find most revolve around the emotion, i want what you have, i'm not happy with my situation. i should be entitled to whatever it may be, free education, a home not burdened by debt. again, it's really hard to define, christine. i do disagree with one thing matt said, when you try to put a fence around everything they want, it does represent the spirit of the american left. will that means it's democratic, definitely disenchanted with democratic party. i think what they would like to see is the democratic party change. >> i want to show you a poll. most americans support higher taxes for millionaires. seven out of ten americans either have a favorable view of millionaires or admire them. just 5% say they resent millionaires. many republicans say a push for
higher taxes for the wealthy amounts to class warfare. the polls say americans want higher taxes but don't resent the rich. i guess i'm confused about -- is it unfair of republicans to accuse the left of class war fair now? is it envy if the polls show people like -- in fact, it's the american dream to be rich. >> i think this is the first elections and the conversation right now is more open about class divide and class warfare than we've ever had. i'm not going to defend the tax rate or suggest prebush levels, 36% versus 39%. that's nonsense talk, a stupid debate. the question is whether or not the tax code is efficient and fair. it's not. that's not democratic or republican condition. position. the way to fix it isn't to sit here and pretend the rich have an unhealthy burden. >> i have to address this. you say it's about envy? of course it's envy. a lot of people are jealous they get to borrow billions at 0 percent from the fed and lend it to us at 5, 10, 15%
a lot of people would like to pay money to law enforcement instead of go to jail, which is what these guys have been doing. a lot of people would like bailouts for bad investment decisions. >> can i say we're not disagreeing. this is the point. that's right. they should be envious of those things. that's about corruption, matt. what i hear, occupy wall street isn't limited to corruption. if we could agree -- >> they're mad these people stole their money. that's what they're mad about. >> if you gave them your five demands that wouldn't alleviate one concern they have. >> let's start with that and see how happy they are. >> i'm happy to do that. too big to fail is too big to exist, and i think they will still be there and unhappy. they don't have what another guy has. >> we have to leave it there. matt, will, great discussion. thanks, guys. >> stay here. up next the cnn western debate. you've seen highlights but not like this. pete dominic will break it down next. that's why i like glucerna shakes. they have slowly digestible carbs to help minimize blood sugar spikes, which can help lower a1c. [ male announcer ] glucerna. helping people with diabetes find balance.
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welcome back to "your money." a busy week in politics, the gloves came off during cnn's western republican debate tuesday. here to look at memorable moments two of our favorite cnn contributors, will cain and pete dominick. host of cirrus xm stand-up. all right, guys. herman cain the candidates slips back into the herman cain the pizza executive mode on the campaign trail. when he decided to talk about fruit instead of toppings at the debate, no one saw it coming. >> are you saying the state sales tax will go away. >> no, that's an apple. >> okay. >> we're replacing a bunch of oranges.
>> will the people in nevada not have to pay nevada sales tax and in addition pay 9% sales tax. >> you're mixing apples and oranges. >> you're going to pay the state sales tax no matter what, whether you throw out the existing code and put in our plan, you're still going to pay that. that's apples and oranges. >> i'm going to get a bushel basket with apples and oranges in it because i have to pay both taxes. >> no, no. >> the people in nevada don't want to pay both taxes. >> a large pizza to go with it. did that make you hungry? >> no. it infuriated me. i love mitt romney's response. >> why are you yelling? >> i'm angry. this isn't fake anger. this is that -- americans love 9-9-9 and apples and oranges because they can understand that. that's not a lot to understand. i'm too busy. yeah, it's apples and oranges. it's not. it's very complex. our problems are complex. you can't use metaphors like apples and oranges to explain that. >> now it's 9-0-9 too. >> which shows herman cain has no idea what he's talking about. he's got like two people
advising him and has no idea what he's talking about. >> there are problems, vague answers on foreign policy, 9-9-9 has many problems from a conservative perspective. his apples and oranges i can defend. his point is the state sales tax that are in place are going to be there under mitt romney, rick perry or barack obama, the current president. they're going to be there regardless. he's replacing the current income tax with another tax the 9-9-9 plan the oranges. they're trying to mix state level taxes and federal level taxes to confuse us. >> ron paul has ideas about reducing our nation's debt. >> this debt bubble is the thing you better really worry about, because it's imploding on us right now. it's worldwide. we are no removed from this than the man on the moon. it's going to get much worse. to cut military spending is a wise thing to do. we would be safer if we weren't in so many places. we have an empire. we can't afford it. the empires always bring great
nations down. >> pete, can the empire strike back with a lower defense budget? >> yes. our threat is not -- our military defense budget is only preparing us apparently for some type of alien attack, christine. we have -- you could put all the rest of the country's budgets together and we still have more money for them. what's the threat we're preparing for? we should be spending money on health care and social security, those issues. if you believe you're going to die in a terrorist attack and you live in ohio versus heart disease, well, you've been duped. >> will? >> you know, i actually agree with something newt gingrich said, i'm a hawk, but a cheap one. we agree on defense measures. i don't know why we're in afghanistan. i can't put a purpose or goal. there's places to cut the defense budget but you have to be smart about it. our nation's number one -- our government's number one goal is defend us, national security, maybe be smart. about how you cut defense. >> will cane, cnn contributor and cheap hawk.
immigration reform will be a hot topic on the campaign trail and it was at the debate. listen, guys. >> mitt, you lose all of your standing, from my perspective, because you hired illegals in your home. you knew about it for a year. the idea that you stand here before us and talk about that you're strong on immigration is on its face the height of hypocrisy. >> will, i feel like i was hearing this four years ago. >> you were. >> i was. okay. i'm not crazy. if you can turn to immigration, can you turn away from talking about jobs and how to create them and the whole job situation, which you -- it feels is an intractable problem. >> it's the number one issue. immigration will only be an issue in the primary, not general election. it seems to be a litmus test who is the most conservative candidate on the stage. rick perry is resembling what he is, a cornered cat. desperate >> didn't rick perry allow tuition breaks for -- >> yes. >> dream act protects us. >> he's criticizing him for hiring somebody but giving
tuition for the children of people -- >> we all know that was a strategy to go after mitt romney, hire some landscapers. mitt romney's best response is rick, heighth is not a word but he missed that. mitt romney is honest when he said, i told landscapers i was running for president, you guys can't have this. he was a little too honest right there. it shouldn't be i shouldn't have illegals to work on my landscape because i'm running for president, it should be because it's illegal. >> let me ask you about this occupy wall street, if you believe the government is broken, economy not favoring everyone, occupy wall street has been gaining momentum. i don't think anybody on wall street or corporate america thought it would enter its second month. where does this movement, will, we talked about this briefly, where does this movement go from here? >> supposed to pretend like pete and i haven't been arguing about this. >> arguing in the men's room, hallway, cab line. >> we had a slumber pizza party arguing while holding the flashlight. >> i don't have any idea where this goes.
i cannot define it. >> pete and i have a fundamental disagreement. is it about corruption or more. if it's corruption, a purposeful place to go and you can get nonpartisan support. if it's about more, i suspect it is, we'll have disagreements. >> it's about income inequality. same reason tea party is mad. same reason that these folks are made. it's about income inequality in the country and how much it's grown. 450,000 protest in israel. it's happening all over the world, about a lack of upward mobility. that's what it's about. masked by the housing bubble, that you could use the equity in your house for a long time, then masked by the election of president obama, people on the left thought that would change it. no more masking it. it's here and growing and so will this movement. >> inequality is natural phenomenon of free market. merit based system. it's going to happen. how much do you want to sacrifice? to flatten out everybody's income -- >> what will just said was insane. >> we'll leave it there and you continue to duke it out in the hallway. will cain, pete dominick, thanks, guys. could globalization close
the economic gap between the united states and the rest flds world? ali's conversation with thomas friedman next. luck? i don't trade on luck. i trade on fundamentals. analysis. information. i trade on tradearchitect. this is web-based trading, re-visualized. streaming, real-time quotes. earnings analysis. probability analysis: that's what opportunity looks like. it's all visual. intuitive. and it's available free, wherever the web is. this is how trade strategies are built. tradearchitect. only from td ameritrade. welcome to better trade commission free for 60 days
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are america's better days behind us? not necessarily according to thomas friedman, the pulitzer prize winning foreign affairs correspondent for "the new york times" times. he's co-author of a new book that used to be us, "how america fell behind in the world it invented and how we can come back." ali velshi sat down recently to talk with him about it. >> tom, welcome to the show. you argue the united states is in decline. here is the interesting part. for years now you have been the voice of globalization and why it's necessary and why to sort of flatten the world out the rest of the world would have to do better. some say by definition the united states would have to slow down a little bit. have you changed your argument? >> well, you know, it really isn't that we have to slow down. two things happen when the world gets flat, as it were. one, there was always going to be a relative closing of the gap between the united states and indias and chinas. that's a great thing. we move up but they move up
faster because they are coming from behind farther. what we want to avoid is absolute decline where they move up and we move back. there's no reason that has to happen. it can happen. what we have written our book about is how to get around that. >> this thing around us is globalization and for many people you are the person who has defined that term because of writing you've done on it. let's put that aside for a second, the whole concept we're each other's clients, we're each other's vendors and the world is flattening out a little whether we like it or not. one of the reasons americans feel we're in decline is we have lost some jobs not just to outsourcing but technological revolution where more is automated, takes fewer people to do the same amount of work. >> well, it's a very good point. a friend of ours always likes to say most jobs, remember this, aren't outsourced to china or mexico they are outsourced to
the past. we used to have a receptionist at "the new york times" washington bureau, we don't have receptionists there anymore. we don't have someone from mexico or china, we have a micro chip. that is true throughout the economy. >> you have these challenges where the rest of the world is open for business, also open to do some of the work we were doing in the united states for less money. even if that wasn't the case we'd be losing some jobs to automation and making people more productive. then we have this challenge for many americans, and i believe incorrectly, many americans think is the single biggest matter affecting us, debt and deficits. let me say i don't think it's not a serious concern. it may not be the most serious concern. what do you think of debt and deficit here and elsewhere? >> i think we have two big priorities now. one is we want to avoid going into a double dip recession and that's why i've supported president obama's plan for some near term stimulus that hopefully will also be stimulating, that will go into
things ta will pay off multiple times in the future. at the same time we have a long-term problem, we need to get our fiscal house in order. if we do the two together, the short run stimulus and the longer term once we're back on our feet in a healthy way dealing with a bigger debt and deficit problem we'll be doing both things and in the right order. the last thing you want to do in the middle of a recession is to get everyone to cut spending. that's how you make a great recession into a depression. >> a few years ago we were talking about gas above $4 a gallon, oil $140 a barrel. the recession slowed that down a little bit. now when you look at the price of oil while historically very high, a lot of people are saying where is the alarm, what's the concern? you are one of those people, again we share this view, who feels the rising cost of energy, we're just pausing on that, we're still on the way up, that is going to be one of the biggest influences on development here
and abroad for the decades to come. >> one. >> well, one of the things i argued in a previous book is the world is getting hot, global warming flat. more people can see how we live in american sized homes, driving american sized dars, eating american sized big macks. more people can aspire to live like we live. when the world gets flat and crowded more people living like us, ali, and just more people, energy demand is only going to go in one direction and that is up. way up. >> the world -- many people around the world are getting more prosperous even as we go through this recession. many of them as you get more prosperous in other countries urbanized, still not doing that effectively in the united states. we still live in a sprawled out fashion. that could fundamentally change as energy prices continue to go up. >> there's no question as energy prices rise, as pollution and climate change become more and more a problem and apparent, we want to move our cities up and not out.
much more efficient. one of the most energy efficient places in america as an urban center is new york city, it's manhattan, because the density of the population is energy efficient. >> it's a global city in that sense. let me ask you about something else happening in manhattan. i know you wrote this book sort of unrelated to this particular issue. there is a manifestation right now, occupy wall street of some of this sense that that used to be us. we used to be great. we used to be a place where anybody could become great and wealthy or prosperous in the united states. there's definitely a feeling that's not the case now. i ask you this because this disparity between rich and poor has been going on for time immemorial in america. where have we come to where we now believe there really is an us and a them and us can't become them? >> well, i think that is one of the impacts of globalization, there's no question. for the united states, we lost a lot of advantages we had at the end of world war ii.
we lived in a protected economy. as the world flattened out, our workers have become more exposed to competition not only from cheap labor but cheap genius around the world. that's one thing that's definitely had an impact. if you combine that with rising health care costs that eat up more and more of the average salary of every american and you have a prescription basically for no real growth in wages for many people for a long time. >> this is a real problem now even for working americans that work for large corporations, about to go into their open enrollment period, getting a big surprise when they realize they're going to pay more for the same health care and less health care. final question, a subject you know a great deal about. china. is it an opportunity or does it continue to be a threat? how do we as a nation confront this rapid growth that is in some sense responsible for us not being where we were? >> i think the most effective company strategy vis-a-vis
china is two things, understand china will be the world's biggest market in the next 30 years. therefore you've got to be there, you've got to be close to that market and those customers. it's not a bad thing. i think the second strategy is the apple strategy. use china for part of the global supply chain that's most efficient for you. imagine the ipod in america, orchestrate the global supply chain that produces the ipod in america, but you can't to expect to have every job in the supply chain be in america if the cheaper jobs assemblinging the ipod are in china. that's not a problem. let's remember $0.80 of every dollar of the ipod comes back to america, apple shareholders. apple headquarters. let's make sure we're at the right end of that supply chain, inventing the idea, orchestrating and doing the most high-end jobs here and let them do those that are less high-end. >> well, the beginning of the book, the title "that used to be us" seems to be a little sad, reminiscent "how america fell
behind in the world we invented and how we can come back" makes this a very compelling read. thomas friedman, always great to talk to you. >> a real pleasure. >> if you're just keeping your money in a savings plan you could be missing out on a big opportunity. how to make money with money next. road trip buddy. let's put some music on.
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or america's c suites thought it would endure. but some are dismissing their motives as unsophisticated or unfo unfolkoused or just not about them. how can they dismiss it? they see the pictures of the free tibet movement, anti-war protesters or iran hikers. they say see this isn't about corporate america, it's not about us, it's a populace movement, more peace and free love of the 1960s than middle class uprising. two bits of analysis caught my eye that suggests that attitude may be a mistake. henry blodgett banned from the industry and now offered cutting insight into that world. he said the 1960s may have been about peace and love but at the end it was public outrage that helped end the war. to dismiss the movement wrongly estimates it. and mark cuban revealed what he says is the great ceo white lie.
we're acting in the best interest of our shareholders. cuban says the 1%, the top 1% think it absolves them of any of the angst reflected in the occupy wall street movement. protesters should buy stock in companies, occupy their shareholder meetings and demand friends and family that own stocks directly or indirectly through mutual funds they do the same. his blog posting was shared widely amid business types. occupiers said they don't want to work within the current system to change it, they want to create a whole new system. their best chance of real change may come from occupying board rooms instead of say lincoln center, home of the opera. and that's my x, y, z. thanks for joining the conversation this weekend. make sure to check out our new book with ali velshi, "how to speak money." a step by step guide to understanding the language