tv Special Report With Bret Baier FOX News October 14, 2011 1:00am-2:00am PDT
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>> bret: in america's election headquarters, obama's campaign raised $70 million in the summer. $43 million is dedicated to the president re-election effort. the $# 0 million tote is $16 million less than the second quarter of the year. the republican side, herman cain enjoyed a surge in the polls of late. chief political correspondent reports cain's message is res ignating and people are paying attention to the economic plan. >> don't tell herman cain he is another flavor of the week soon to melt. >> the flavor of the week, black walnut isn't a favor of the week.
>> the surge has been through debate and tv commercials. the campaign of mitt romney, rick perry and ron paul key early states and nationally dwar the cain camp, which admits struggling to catch up organizationally, while he tried simultaneous to extend the hype speed in the poll no denying thed 9-9-9 plan has buzz. discount airlines borrowed it and urged people to buy cut-rate vacation flight now. after meeting with donald trump in new york today, michele bachmann trashed cain's 9-9-9 plan to alter the existing system and create 9% income tax and 9% national sales tax. >> you don't give congress a new revenue stream. they spend all the money and then some. congress is just a big money-eating machine. >> cain has been reluctant to identify the top ide visors. the tax plan was developed not by economist but an ohio wealth manager and
conservative activists that worked with the d.c. think tanks. that created the cpac and americans for prosperity that advises many tea party group. cain's call for national sales tax on top of the local and national sales taxes troubles conservatives. the influential president says 9-9-9 is catchy, but it won't work, won't pass and could lead to higher taxes. >> if you have with the incomes tax one needle in your arm drawing blood why would you take three needles to stick them in on the promise they'll only take as much as they used to take? the danger is they drain you three times as fast. >> reporter: mississippi governor haley barbour seriously considered a run of his own and said if the election were today his wife would probably vote for cain. by contrast, texas governor rick perry's wife said every time she hears 9-9 of 49 she wants to call 911.
carl cameron. fox news. >> bret: to talk more is economist art laffer, former advisor to president ronald reagan and joins us from new york. thank you for being here. >> it's a pleasure. >> bret: are you a supporter of 9-9-9? >> i think 9-9-9 is a wonderful plan. a lot of candidates have good plan for tax reform but i love the 9-9-9 plan and i think it's a great first step. >> bret: were you consulted in the making of 9-9-9? >> i met with most of candidates and i met with herman cain. i did talk about his tax plans, yes. >> bret: why is it a good plan? >> the first place, what you want to do on texas is lower tax rate and broaden the tax base. so you give them the least places to which they can escape.
you want an efficient tax code people won't cheat on. his plan does that and lowers the rate. it's important to get rid of the corporate rate, a silly tax. >> bret: critics of this say it's regressive and would hit the poor. what do you say to that? >> i don't think it's true. it gets rid of the payroll tax that is regressive and gets rid of other taxes in the system as well. for those below the poverty level it replaces some of them so they get the taxes back. i don't think it's regressive at all. >> bret: what about the critics on the right saying once you open a spigot to washington you could have a 20-20-20 plan, because there is no, because lawmakers want to tax more down the road. >> you have got the problem with politicians. if they want to pass
legislation in ten years they can do that. but you can't control the future congresss or presiden presidents. i think this is a good and efficient plan. if i could do anything to stop future politicians from raising taxes i'd love to figure it out. >> bret: cain says in the second phase he would phase out income tax for individuals and corporation in favor of the national sales tax. that could get fairly high. critics say, you know, people on the fixed incomes and people worried about the price of things going up, how do you respond? >> i don't know about the long-term phase. i just look at 9-9-9 myself. you have to believe that taxes are all the prices. they always are. it's jest how they get in that price. if you tax a corporation, it will charge higher price for product that you buy.
if you collect the same total revenue in an efficient way, none of these systems will lead to higher or lower prices than the others. it just won't make any difference in the overall price level. >> bret: bottom line, you a supporter? >> this is better than the current tax code. the current taxes are venomous and filled with awful ducks, chicken, pigs, turkeys in there. they just got to be cleaned out and we have to completely revamp the code. i would love to site done. >> bret: thank you for your time. >> thank you. pleasure. >> bret: herman cain will be a guest soon in the new center seat segment for presidential candidates. the next installment is friday with former new mexico governor gary johnson. next week, rick santorum. jon huntsman is here tuesday, 25. herman cain stops by november 1. we're working to schedule all the candidates if for center seat with the panel.
>> bret: the u.s. trade deficit dipped in august to $45.61 billion. the lowest amount in four months. the deficit is running at an annual rate of more than $564 billion. up 13% from last year. applications for unemployment benefits fell by 1,000 last week. but are still well above levels considered healthy. stocks were mixed today. dow lost 41. the s& s&p 500 gave back four. nasdaq added 15.5. of course, wall street is getting a lot of unwanted attention lately, because of the protests there. which leads us to the
question: are the people on wall street really to blame for the struggling economy? chief washington correspondent james rosen went in search of an answer. >> the member of occupy wall street tend to blame economic morass on service sector. >> i have in mind a system between government, wall street, and media. >> but now a scholar at the conservative think tanks argues to narrow the list. >> i don't want to suggest what happened on wall street is not a factor but the important question is whether the financial crisis would have occurred were it not for housing policies? >> the bush administration seeking to boost rate of homeownership forced the len
lenders to underwrite mortgages for ever riskier borrows. then the financial system collapsed. >> to get there they have to take tenuous steps. they say it wasn't the affordable housing process but what has been unseen since '20s to allow the sub prime and other mortgages repackageed as securities. >> they start in the 1990s. you didn't see it in '94 or '97. it starts as the securization takes off. >> a majority of members concluded earlier in year that the crisis was brought on by a combination of low interest rates, easy and available credit. scant regulation of wall street. >> occupy wall street members may not be inclined to look to
market conditions for solace. but the country vast inventory of unsold homes makes it unlikely another housing bubble like the current mess will recur anytime soon. >> bret: if you were an ice cream, what flavor would you be in herman cain may want to rethink his answer. startling claim about the president's jobs bill from vice president joe
>> bret: now fresh picks from the political grapevine. massachusetts republican senator scott brown is criticized for to posting on his official website that was apparently lifted verbatim from the website of former north carolina republican senator elizabeth dole. the "boston globe" report the democratic group unearthed the texas included in a message from students to brown that reads in part, "i was raised to believe there are no limits, individual achievement. i was encouraged to join causes larger than myself. and to stand up for what i believe." brown's staff acknowledged the many saj was originally dole's and blames a technical error. vice president biden suggest murder and rain could increase if president obama's jobs bill/stimulus package is not passed. that is because the bill includes funding for public safety officers. biden said in a stop in flint, michigan, that anyone who
doubts what he called the direct correlation between crime and the number of police need to look no further than that city. finally, as you heard, republican presidential candidate john mccain often refers to himself as hazzndaus black walnut ice cream when asked if he was the flavor of the week. it might have been a flavor of the week but they tell us it was introduced in 2005 and discontinued in 2009. we reached out the cain's staff who joked the candidate might shop around for another flavor. america often been called the land of plenty. which is why the subject of the next report by senior national correspondent reports is so shocking. he says many of rus dying for what most of us take for granted. >> after-school counselor has the three-pointer nailed but
he also has leukemia. what will shock you, he doesn't know if he will get the next dose of chemotherapy. >> the max general pharmacy wrote me iou of 105 tablets. i called on monday. they said they don't know when they'll have it. >> alex was diagnosed two years ago and has been on chemotherapy since. he has been left without crucial drug to raise rate from 40 to 80%. >> this is outrageous we don't have the drugs available in our country with the most advanced system available to treat our patients. this is frustrating and it makes me angry. >> alex is not an isolated case. they are dealing with shortage of drugs. heart medication and ivy nutrition and -- i.v. nutrition and pediatric
vitamins. the list goes on. at emory university hospital they are short staggered 286 drugs. every day is a juggling act. >> you have to make sure they get the medication. >> emmert isn't at the point of -- emory isn't at the point of rationing but they are getting close. >> we have not had to make a choice between the patients but between conditions. which condition needs that particular drug and which has least acceptable substitutions. >> since 2006, number of drugs on shortage tripled. there is no reason for it. increased legislation led to production delay. most are off patent so they shifted to profitable lines. doctors are forced to find alternatives, but swapping drugs and dosages can lead to mistakes. aaron fox tracks the national
drug shortages. >> put it at risk for the medication safety errors because there are shortages. the safety errors are causing patient adverse effects including deaths. >> at least 15 deaths have been linked to the drug shortage. then there is the cost in dollars, says emory medical oncologist donald harvey. >> there are fe fairous purchases out there to buy drugs and hoard them when they know there are shortages. and the rates and charges go up. >> with no rules against price gouging in the drug market, emory has no choice but to pay through the nose. >> our cost increased from 100 fold to 1,000 fold. it's like the stock market. so the prices change on an hourly basis. >> for alex no, amount of money can buy what he needs there isn't any. every day he worries if over the course of his treatment he got enough to send leukemia away for good. >> kind of nervous about it.
it might come back. but i pray it doesn't come back. >> nearly 100% of the hospitals across the nation experienced a short knowledge the past six months about they rarely get advanced warning that a drug is not going to be available. for example, on monday, emory healthcare only had enough of the anesthetic propofyl to last a day at one of the four hospitals. new legislation before the house and senate would provide for fines if a drug company didn't give more advanced warning. so far, the legislation not made it out of committee. >> that is a troubling story. john, we'll follow it. thank you. house minority leader nancy pelosi today suggested that women would be allowed to die under an antiabortion bill being debated in congress. >> when the republicans vote for this bill today, they will be voting to say women can die on the floor and healthcare providers do not have to intervene. if this bill is passed.
we believe even at the highest levels there was not detailed operational knowledge there has to be accountability with respect to anybody in the iranian government engaging in this activity. not just a dangerous escalation. this is part of a pattern of dangerous and reckless behavior by the iranian government. >> bret: joint news conference today at the white
house alongside the south korean president. there is a steak dinner at the white house tonight. president obama accusing iran in that behavior leaving open the possibility to other response beyond economic sanctions. we'll start there. bring in the panel. steve hayes, senior writer for "weekly standard." juan williams columnist with the hill. and charles layne, editorial writer for "washington post." chuck, surprising? what about the president's remarks about the iran plot? >> i noticed in that footage we just saw how carefully he seemed to be choosing his words. not to directly accuse the top man ayatollah khomeini in iran being directly knowledgeable of the operational details. he didn't want to go there. he wanted to keep tensions lower than that. there are people around the world saying it would have been an act of war if it had been carried out. calling for tough measures. he looks like he is not ready
to go there yet. >> bret: we heard the state department had direct contact with iran at some level. we don't know details of this. after this plot was found to be tied to the iranian government. >> right. i will be interested to find out what kind of direct contact the state department has. we know in virtually every other direct contact the united states made with the iranian regime, it has been in search of better relations. some kind of extension of the hand with president obama first mentioned inaugural address to improve relations. the president today i think furthered that sense. he talked about iran being out of bounds. he talked about this being against norms of the international behavior. it was as chuck says, very careful choosing his words. i think not to go beyond the evidence, which is smart. but also, i think in a way that suggested further weakness. we have weren't going to do anything. this is the same rhetoric we have had before, every step we have had in the
confrontational with the iranian regime in the past two-and-a-half years. what was most striking about this, in my view is the different tone he took. moments later in talking about congressional republicans. it was unbelievable. it was in response to a two-part question from the same reporter. the first part about iran, the second part about republicans. he was measured. he didn't want to provoke any kind of confrontation when talking about iran. then with the republicans he said i'm going to force them to do this and get them to do this. he went after them. he was angry. i would say we deserve anger when he is talking about iran. >> bret: well, be the jobs package in his response in a minute. let's stick on iran. a number of people, retired military analysts who are now openly saying that the policy against, with iran of isolation has really not worked. and that this is an example of that. this plot. >> well, clearly, just by the fact they're background military analysts they are
looking toward some kind of military action. let's just review the options that are on the table. you could say let's target the republican guard. qods. let's go after that element, top of the military unit. in iran. but that would mean going into iran. that would mean we would essentially be starting another war. okay. then there are some who suggest option number two, israel. why don't we free israel's hand to take some action here? again, that is an option. guess what? everyone would see we were the hidden hand operating here. encouraging and allowing israel to use the military bases that are allies with us in the middle east. the third option is that you try to get china, russia, others who have been reluctant to participate in sanctions against iran. to now up the antiand say look, we have to go after the central bank. sanctions so far have had effect. believe me they have hurt the iranian economy. and to that extent encouraged regime change inside that
country. but there are people who say no, the obama administration should have done more to encourage the regime change. >> bret: 2009, when the revolution was happening. >> correct. and the sanctions have not been sufficiently strong to make it clear that we are capable of breaking their government. so now, if you can get, use this incident to generate international support for heavier sanctions that might be the third option. >> bret: that is the big question mark. turn to what steve mentioned there and the president's comments about republicans and the jobs bill. >> the republicans haven't given a good answer to why they have not agreed to wanting to rebuild our roads and our bridges and our schools. they have not given us a good reason to why they don't want to put teachers back in the classroom. if they don't want to support the bill, they have to answer not just to us, but also the american people to why they wouldn't. >> bret: chuck? >> well, there he is. he is using this jobs bill the same way he has been using it
for weeks and weeks as a battering ram against republicans. i think to the extent he is saying the republicans need an alternative to reject this thing. he has a fair point. they have now unveiled their plan today. >> bret: there have been a number of bills passed the house that have not been considered in the senate, the deal directly with job creation. >> correct. but you know, he has put the bill forward now. they have not presented a direct alternative to it now. until today. when you had a number of republicans roll something out. now the next thing that will happen of course, they will break the original obama jobs bill up to little pieces to try and put the most politically attractive one up first and oblige republicans to vote against that. we'll have to go through that exercise for a while. then ultimately, probably by the end of the year, they'll do a couple of things, maybe on infrastructure, maybe on payroll tax that both parties can agree on. >> bret: steve? >> yeah. i don't buy that chuck's
argument basically. this is something that republicans have been pushing. they have been pushing it again and again and again. whether in the form of legislation, or the form of original paul ryan budget. pro-growth plans. just because they didn't do it in direct response to the president, that is not their job. i suspect many people on the left are criticizing the republicans if they waited until after the president presented his proposal to present accountable. so republicans have been pushing this for long time. president wants to campaign on this. this is the 2012 election. we're watching it now. >> bret: you can hear the thunder behind us. do we have a shot of the white house? pretty ugly outside. we thought we'd go to break here. next up, herman cain. can he win? and do you understand the 9-9-9 plan?
someone once said consistency is genius. i think this is why i got so many arrows last night relative to 9-9-9. it is a well thought out, well developed plan. >> if you have with income tax one needle in your arm drawing out blood, why would you take three needles and stick them in, on the promise that they'll only take as much as they used to take? i think the danger is they drain you three times as fast. >> this plan is a very efficient way to collect the requisite revenues we need to run government. so i think it's a very good and efficient plan. if i could do anything to stop future politicians from ever raising taxes, i would love to figure it out. >> bret: art laffer economist for president reagan met with herman cain about this 89-9-9 -- 9-9-9 plan and signs on to it there is the latest "wall street journal"/nbc news poll raising eyebrows and the
change from august to october. look at that. the skyrocketing of herman cain. obviously, you heard it. 9-9-9 is the plan. here it is. 9% business flat tax. gross income less investments, business purchase and dividends. empowerment zones will offer deductions for payroll employed in the zone. we'll talk about that. individual flat tax, 9%. and there you see the gross income less charitable deductions. also empowerment zones here. it's also an added feature to this. national sales tax is 9% on all purchases. this is a big question mark with this plan. we're back with the panel. steve, it's getting a lot of attention. a lot of people are talking about it. the last debate essentially was about it. largely. what about this and now you have representative paul ryan saying he loves the plan. you have herman cain saying if he was elected he would consider paul ryan as vice
presidential pick. and also senator jim demint as vice presidential pick. this is interesting. >> good people to mention, certainly, especially to generate additional enthusiasm among conservatives. where herman cain is trying to go with the 9-9-9 plan is where we need to go. what is surprising if you look at the republican field how timid the other candidates have been about tax reform proposals. at a time when this economy -- the supercommittee is debating tax reform but the presidential republican candidates haven't made it a major issue the way herman cain has and has done it successfully. the problems with the plan i think are keeping an income tax. if you add sales tax do everything you can to eliminate the income tax. >> bret: that is phase two, he calls. >> 9-9-9 is second phase of three-stage plan ending with a national sales tax, eliminating the i.r.s. >> bret: fair tax as it's talked about. >> it would have been smarter more radical certainly, smarter to go from just the
incomes tax as we have it now to national sales tax. people say it wasn't doable. same people criticizing him for saying this is too simple would say it was too complicated. never happen. >> folks like juan say it's regressive. art laffer, economist for ronald reagan no slouch looking over economic plans supports 6 i fully and believes it wouldn't be regressive because prices would go down based on companies taking -- that's what he said tonight. that's what he said tonight. >> i'm listening to you. >> bret: you heard the interview. >> i did. he speculates -- he is guessing. the fact is when you look at the plan right now, especially for people buying essential items, going to the store to get milk or something that this would be a sales tax on top of your local and county and state sales taxes. >> bret: but you wouldn't pay a payroll tax. >> that is right. the question is for example on
corporate taxes what are you paying taxes on? on goods? yes, says herman cain. what about services? i don't know. we don't know. and again, when it is score by independent budget analysts they say it doesn't produce sufficient revenue to run the government. less revenue than we are getting now. >> bret: in part, they respond, the cain folks respond they don't dynamically score it. they don't take into account generation of revenue that would come from simulating the economy so dramatically. >> this is laffne's point but this is speculative. if you look at the facts the way they stand it doesn't carry water. if you look at the plan, the virtue of the 9-9-9 plan in addition to branding involved from a businessman. >> bret: spirit airlines has already taken it. >> i love that part of it. if you look at that part, people say to me all the for my criticism of it, it's simple and coherent. i understand it. it's something to me that speaks of conservative virtues
very centrally. i like him. and i like it for that point. >> bret: chuck? >> i agree with juan in the sense i think it's terrific politics. it's easy to understand. attractive and so forth. i have to say i have a lot of questions about it. i've been jotting them down as we talk. eliminate the payroll tax. that means the social security is no longer a social insurance program? it's a pure welfare program to be funded out of current general revenues. what about that? what does herman cain say about that? ditto for medicare, by the way. what about the 9% sales tax. does it go to your utility bill? i did back of the envelope thing with steve before the show. we figured out that would make a federal gas tax of 30 cents a gallon if applied to gallon of gas, which is higher than they're taking now. by the way, it would increase as the gas price going up. >> bret: we have questions for herman cain on center seat when he sits on the panel there are questions about internet sales. that opens up a different door. >> right. >> bret: about whether
that. >> but the general -- >> bret: finish your thought. >> it's simple on paper. but every one of the questions we are discussing would have to be hashed out when the legislative process -- >> bret: but there is a hunger for that, isn't there? a hunger for saying you know what? forget this stuff about the deductions here and deductions there, paying the guy to do your taxes that can't figure it out. and make it simple. >> that is why some kind of tax reform is going to have to cop next year. >> the u.s. tax code, federal tax code is 70,000 pages. we had the chairman of the tax writing committee in congress not able to figure it out. the treasury secretary not able to figure it out. head of the i.r.s. admit he goes to somebody else. to have his taxes done. you have 82 p.c. of the country that spends money in one way or another on having their taxes done, whether it's 60% that pay an account tant or 22% that using software to prepare their taxes. that is a huge problem. >> bret: ten seconds, down row. does surge continue for herman cain? >> i think it continues for a while. >> yes, i think that if you look at numbers and the polls this morning, tea party people
bret we all know the u.s. economy is in rough shape. more than 14 million americans out of work and people feeling the pinch all over the country. people looking for a turnaround and some hopeful signs and this week they got this it. >> they just want the nobel prize for economics. they are with us this morning. >> what can be done to give this economy a boost? >> so, that is a very difficult question to answer. >> bt: