tv Wall Street Journal CEO Council Democratic Economics CSPAN November 26, 2016 4:18am-4:39am EST
>> business reputation. doesn't some of this have to do with the 1% income inequality. the growing gap, the ever owing gap between the c suite,ened that also kind of to disaffection with the public with big business? >> i think what really is going on is that regular americans middle class, lower income people have not ad a good environment to increase their income at least since 2000. there was a statistic esterday, 60% of americans
have less real income in the last 16 years. this is appalling, not just some people because the federal reserve lowered interest rates and popped up asset values. it is a more serious problem and you have to address this with a positive approach in policies to create economic expansion, not at the rate we are doing, and you have to dramatically increase economic growth to help the people in the country. >> but c.e.o.s say they are not willing to spend. some of them feel a little animated but not enough to grab their checkbook. >> these things have to start some place. you start with changes of
policy. much more ith a neutral to positive approach towards innovation, growth, you set up the policies, create a different environment and things start happening and that is the way you make change. i think part of the election, is those issues are going to be addressed. >> frankly with steve's point, i think it is less about somebody is doing well than it is somebody is doing well and i'm not doing as well as i did before. if everybody is doing well on a different basis, i don't think hat is so bad. i thought bono had a great line when asked to compare and contrast the u.s. and ireland. he said in the u.s. if you don't have any money and you
walk by a big house you look up and say some day i'm going to be that guy. in ireland, you say some day i'm going to get that guy. we still have that attitude in the country, that i want to be that guy. we can't lose that as part of what we do. were > congressmens, questions? thank you very much. >> gene sperling spoke at the wall street journal c.e.o. council a week after the election. he talked about the election results and described clinton's economic proposals as unpopular but necessary. this is 20 minutes.
>> thank you very much. thank you, jeanne. >> thank you. >> playing cleanup. given the events of a week ago, a particularly apt meaning for you tonight. let us talk first if we could about this election. you were an advisor to the clinton campaign. you worked, as john said, both in the bill clinton administration and in the barack obama administration. you have been a key advisor and policymaker in economics. you were an advisor on the clinton campaign. you heard elizabeth warren no doubt today talking about some of the issues. i don't want to proceed for a postmortem, but what went wrong? why am i not talking to you now is the next treasury secretary? mr. sperling: i think there will be a lot of conversations about campaigns and strategy.
i think we had an excellent person in hillary clinton. i think his fortune is our misfortune, is we had somebody who was perhaps extremely qualified, vast experience, at a moment and time where that was not wings to fly but instead a deep weight. my first campaign was the dukakis campaign in 1988 and george herbert walker's experience was tough for us. it was like a positive thing hard to overcome. was here, i think it did make it harder for her to capture some of that anger and outrage that perhaps trump and bernie sanders were able to capture. but, look, -- >> because she had been part of the incumbent administration? mr. sperling: she was first
lady, she was senator from new york, she was secretary of state, and she had to have a delicate message in the sense that to those of us who really believed barack obama help save that helped -- barack obama helped save our country from a great depression and deserves a lot of credit for how well things have gotten and yet we are a little bit like the football team that was 0-16 and now we are 10-6. it is a lot of improvement, but people want to go to the super bowl and it is not there so she had to both be a change candidate and yet somewhat build up the support of the legacy of this, you know, past president. so it was difficult but you now, i will say that you know, having been involved in all of this i believe one should be very passionate about their values. you know, to me, i am in policy because, you know, i believe we should have a country where every child, you know, the accident of your birth should not overwhelmingly determine the outcome of your life. where there is room for poor
americans, immigrants, and for people to rise and that working families can work with dignity, raise their families and many, -- and with dignity, retire ith dignity. and those are things i hold dear and i think you have a lot of humility. host: one thing on the line was how disastrous the last eight years have been for the democratic party across the country. you can measure it. they lost half a dozen senate seats, 25 house seats since 2008. republicans have astonishing control across the country of governorships. extraordinarily strong position and now have the presidency, too. what has gone wrong from 2008 where you took everything and you seemed to be advancing across the country and now you are in a worse position than you have been for a generation? mr. sperling: that goes to the humility that we won twice but there were problems.
as elizabeth warren said earlier, yes, they won the electoral college and that is how you win the presidency and they get to govern but you know, they are going to have a respectable popular vote loss and they lost spots in the house and senate so i guess what i feel in my heart is with barack obama coming into a terrible financial crisis was no doubt a mixed blessing. it absolutely made it easier for a democrat to win the residency in 2008. the terrible financial crisis, as i think others have said, they are terrible and at least three ways that are difficult. number one, the degree of pain and suffering in people who lost their dreams, houses, savings, was terrible. secondly, when you have recoveries after great financial crisis, you do not
get the pent-up demand to 1984 morning in america. you get people deleveraging and you get people deleveraging at the time when you need that robust growth so you do not get legions of long-term unemployed people who never get back in. and then, third, the remedies are almost inherently unpopular. you have to stabilize the 75% of the system which is larger financial institutions. you stabilize them to help the average person, help their savings, but that person still sees you stabilizing the people who look like they are the culprits. and so, you get yourself in a situation where you have to do what you have to do to save the economy but it is not out of anybody's agenda for what is popular. host: save the economy but destroy the democratic party? mr. sperling: no, but i think when you inherit a financial crisis like that, it helps you get reelected but it makes it
harder to completely meet the expectations of people when you are overcoming the type of -- i mean look, this was not an average of recession. this was the worst recession and crisis since the great depression. you did not bounce back as quick. and i think, look, we could talk about other things. i think people got kind of stimulus fatigue. you know, if you want to know, what was the chart we used to show barack obama that would drive him absolutely crazy, we would say, what would growth be in the economy and unemployment if state and local spending had been the same under your presidency as it had been in the bush and reagan recoveries? it was devastating. private sector gdp has been 2%. the reason why it has been over 2% is the contraction at state and local level. that showed the public
tolerance for kind of keynesian when they see you do a bit and there are two ways to look at it. for us, it was like, no, you need to keep increasing demand, do more infrastructure, get people to work. host: productivity has been poor, one of the weakest we have had. private sector productivity is now back to the 1970's, that is a reflection, not an economic achievement of this dministration. mr. sperling: no, but i think there is a lot of mystery about productivity right now. whether it is accounted for right. the fact that, you know, whether gps clearly makes us more productive does not come into the gdp factor so it cannot be part of productivity. but i do think, and i think they lot of us feel there were still demand issues at a time when you needed to get things
back and to be fair, barack obama did try those things. you can think they are bad policies but you cannot say he got to implement all of them. and i think right now, many progressives are united in that we need more full employment economy. you see a lot of us being more dovish than janet yellen and would like to see more demand. and quite honestly, i think that is more pervasive even in the business community now who are hoping that donald trump actually succeeds in what has been the democratic agenda of a stronger, more significant infrastructure boost into the economy. host: why don't we ask audience questions? ight here. >> i'm nick from snap on tools. what you said about president clinton and his focus on the middle class and promoting it, i would suggest that i just spent last week, election week,
in a factory in iowa. from their perspective, it is like this. if you look at the campaigns as the balance between priority among social issues versus economic issues, they clearly saw the democratic campaign as prioritizing social issues before their own economically based issues. whereas they saw donald trump on the other side, whatever they thought of him, prioritizing jobs and economic issues. despite the fact that karl rove said it, is the middle class stupid and stuff like that. it was almost like the democratic agenda departed from bill clinton. going forward, how do you see that playing out? do you see the democratic agenda going back to emphasize economic issues over social issues or do you see them trying to double down on the social issues? mr. sperling: this whole week has obviously been very painful. it is painful to hear you say that because from our point of view, from her point of view,
the economy was first. i do not think that is an aspiration of the campaign. but we will have to look at why that did not break through. maybe it is just the idiosyncratic nature of donald trump, a once-in-a-lifetime personality who, you know, we worked forever on a really mbitious college plan and it came out the day he was fighting with megyn kelly. we could just not get any coverage. that was what it was like. you know, was that just kind of bad luck? was that our failure? i guess i will tell you, policy wise, the focus was still "the economy, stupid." the focus was, and this is different than what david comey was saying, think we were trying to focus on an economic
plan. a plan that aligned tax incentives and investments in what would create jobs on our shores. it would be good for middle-class and infrastructure plan. people responded quite well. even exit polls are very mixed on who they thought had the better economic policy but as i said, you have to have humility, and you cannot sit there and say, we meant to do a, b, and c. if we failed, then we have to look at that going forward. i do not think it reflects there was a conscious desire to not have it be an "economy, stupid," campaign. that was her aim, and if it did ot come through, that was more of a failure of execution than intent. >> any other questions? >> yes, right here.
>> mark from hyatt hotels. the first two major economic initiatives put on the table are infrastructure and tax relief for tax reform. first, what is your take on what has been indicated so far and secondly, what level of congressional support amongst democrats do you think there will be for those two initiatives? mr. sperling: well, i think hat is to be seen. because they will try to do this as a reconciliation measure, which not to bore everybody, is a process by which you use a budget resolution to essentially only need 50 votes in the senate. obviously, vice president pence can do the tie-breaking vote. that creates the opportunity for donald trump and the republicans to pass a tax reform and perhaps
infrastructure bill without any democrats. now, you know, reconciliation is a complicated term and you know, that is a possibility. now, part of the question for them will be, if you can do it, do you want to do that? and i think that if they want to pick up democrats, they are going to have to move off division. there is going to have to be ore focus on the progressive -- progressivity of that tax package, whether it is draining our fiscal situation for tax relief that is going mostly to upper income americans. they have this challenge even in the campaign which is on the republican side, there is a lot of pressure when they cut the corporate rate to cut the other -- pass-through rate to the
same level. we all know that probably everybody would be kind of for that if every pass-through was the owner of a hardware store, but pass-through is every corporate law fund manager, every hedge fund manager, every consultant and for a lot of people, that is going to be just a backdoorway of lowering taxes for the most well-off. hen people have both white house and the house and senate, they tend to look at it as their moment and sometimes overreach a bit. they have to be careful and i would say to people in terms of corporate tax reform, obviously, as part of president obama's team, we were engaged in that process. we do believe that our current process is irrational and you want something that is more simple, fair, and encourages more job creation. here it has your brilliant cfo spending more time helping you create new products as opposed to doing international tax
arbitration. so we kind of agree with hat. but i think that people will judge this a lot in the end alined those benefits are with the kind of job creation and investment impact and in 2004, when there was a repatriation holiday which lots of democrats voted for and george bush signed, the analysis was fairly clear, almost unambiguous that almost 90%+ of the money brought back was used for dividends, stock buybacks, stock buybacks that will raise the compensation of executives, etc. and if people look at the end and say they did tax reform and it led to this rising tide and it really helped workers but if it looks like, boy, this was just something where they were able to do whatever they want it has democrats did not control anything, and this was just a i guess what elizabeth
ward would call it, two elites, i think it will backfire. i think when you have the prevention of having the whole government again, it will be interesting to see whether you can run the table or if it will be in your long-term benefit to try to buy more support from rogressives. >> gene, thank you very much for joining us and coming all the way from california to do so. some quick housekeeping notes. anybody who has decided to go to the sponsor dinner tonight, the shuttles are leaving at six -- 6:15. there are a couple more seats left if some of you folks want to join. i will see you may 16 at the tokyo palace hotel for the ceo council asia. back to jerry. mr. sperling: thank you very much. [applause]