Nov 7, 2011|
Steve Moore from the Wall Street Journal discusses the role of the Super Committee
Transcript - Not for consumer use. Robot overlords only. Will not be accurate.
We have some pretty severe economic and budgetary problems here in the United States we're joined by Steve Moore from the Wall Street Journal to give us a refresher course. In the super committee it has not been getting a lot of attention Steve welcome to the show. Thank you Steve if you could would you remind us what the responsibilities. -- of this super committee place. Sure that people may recall that that remember what we have that they got -- -- over the debt ceiling debate back in pockets. They outcome was spit the act congress and the president agreed to cut by an order billion dollars in spending over the next ten year. And then create what they call the super committee which is six Republicans six Democrats in congress. To come up with another one point 25 trillion dollars a -- reduction or more by the way that one point two factually it was the that was because the minimum. I -- I doubt where they are not right now it's. Completely grip to you know just like the Congress's current lot. There is no consensus about how to move forward Democrats only one outraged. Actually a Republican does you know we're not -- pre tax increase -- most Republicans. Ran -- old tax increase budgets on the run for congress it's gridlock right now there's -- band unfortunately not enough but ratchet. You know trimming those big entitlement programs like Medicare Medicaid and so security the ones that are driving its enormous debt that that -- there and -- -- about. We'll Steve it is there room for some kind of compromise like could the Democrats say look with a lot. He unity -- look at firm on a 1000000000005. Will give you 500 it will give you a trillion in budget cut -- whole lot 500 billion in tax increases. That you know certainly that possibility on the problem as Democrats -- wave you know like the deal you to suggest maybe two dollars and I'll it acts as. That Democrats are nowhere near that right now there are a lot on the dollar you spending cuts for more than a dollar. The tax increases so. They're not that's all the mob you know soak the rich and the problem here for those who wanna get about that now. Quite frankly President Obama who has decided it's not participated for. Virtually at all and that's the -- in the negotiations even though he created the committee in the first place. Because he -- this campaign narrative that congress does optional Republicans are just the party of all so he wants the thing the ball which is very cynical. You know I think it's certainly. Something that makes -- order. To reach a deal. That we should put the contacts trillion dollars of reduction of an extra year. Federal supposed to file and truly doubt that's the -- below from the should be be cut to make and yet they can't reach an agreed. Well I think that the president has to be careful how he handles that Minnesota Republicans I mean maybe they need to come out. With the deal because the independent voter is gonna be watching Steve. You know. -- that he's got the right I think you're right everybody. I don't want to deal made that. Did you know it starts to bring these expenditures -- I mean what I believe that we -- problem is is the expenditures not on the tax side that it would got -- grow the economy. -- Republicans are saying in these negotiations does not grow the economy. Battle bring tax revenues actor but let's also get rid of some of the spending and long term. For you know Medicare Social Security because -- the fundamental problem. We have 75 million baby boomers that are going to be retiring in the -- ten -- fifteen years and we -- publicist about that will bankrupt the country if we try to keep up. Yeah any news on foreign profit repatriation night I look at that you talk about low hanging fruit Steve I I look at that is a quick way to bring in. Several hundred billion dollars of new revenue. Yeah good point then. Did that it on the table there is you know I didn't -- that all of Republicans and some of the Democrats agree that. You know you've got you said they got a trillion dollars of capital as -- applaud it's not beating about stated creating jobs here in the -- If you give them maybe -- 5% tax holiday they bring up money and you raise revenue on that body at 5%. -- on the money issues to create businesses sort of expand business itself I'm what do you I think that makes it makes just a world of good shots. If they don't come up with a deal what type of cuts are going to be made to Medicare and Social Security I mean. Assuming that the the they remain deadlocked what type that would -- what do seniors looking at for social security and Medicare debt reduction. Well first of all the way that's what law works and it's important is that the job. Is that if there is no agreement and they can't reach one point 25 trillion ever it's called that's -- I'm without word from mother grabbed by the day and sequester basically says that there's not -- the board -- In every domestic. And that's discretionary -- defense program. By anywhere from between now want 5% in 2013 and and you got these cuts year after year. Bob Porto -- big cuts to the defense budget tacked on -- it to become as much as -- shots out. Lived in terms of BP program those those security Medicare Medicaid they don't really get touched by the speedster -- So that Republicans and have to be under a lot of pressure. On the military side of the equation because we did it leave ourselves defenseless. Well let's and that's the point that you know like my interview that I did with that Japan Chile was the Republican culture of the Christian he got exactly that that the citizens are why are we cutting. Sixty billion dollars from the -- -- the outlook we can cut the cajoling makes some cuts in defense but that is really jeopardizing our national security that is of very Smart. What is military experts -- I mean to what can we afford to make in terms you're gonna have to cut military spending how much can we -- it. Without jeopardizing national security. I'll -- that's the question. Look I do think there is room to cut the defense budget I think there's a lot of waste panic and it spreads are practically working in the shadows of the kind of -- -- -- You know I think there's too much bureaucracy had too many. Kind of shady deals in terms of the contract and so I look I think that the current budget I think everything every agency of government that's gonna have to take it you're one or buying one point two trillion dollars borrowing forty cents -- -- -- we W can't keep doing not. Proper. Day I've got to believe that Social Security has to be a big target I mean you look at the the amount of money expended there. And and it's you know when you look at the at least the actors I've talked to Steve they've told me that look I have to do is push -- the retirement age by a couple of years. And may be reduce your benefit by somewhere between four and 7%. And you've got it fixed the -- it doesn't seem that difficult. Now I completely agree with you it's not you know it's it's basically saying okay let's gradually raise the retirement age who were living longer that's a good thing right. And I -- produce and program -- changes in the benefit structure so that. No one part of the Bill Gates don't get these big checks every option you can do the same thing by the way Medicare and we've got to judge could write fifteen trillion dollar national debt. To warm Butler really need to get its health care for Medicare. Yeah yeah me that I guess that's part of the the problem but then people are gonna say well yeah but I paid into its -- you know I'm I'm entitled to my benefit and I'm gonna give that money to the charity I choose as opposed to the US government. Well you like that's the argument that will be made but my feeling -- what these are our government program we can't continue to afford best. If we Kia will run these programs and other. Then you know they may go away entirely I just believe that we move towards a system. Where you know -- some people you know people who have maybe 20300 -- on and calmer more can you don't get need to get out of that simply. A character perfect example I mean they did well during the -- but where are. You know he gets Medicare right now he just need to get -- those benefits from Jerry can afford to pay more you know health care the -- pocket. It should be more for low and middle income people really are struggling to pay those bills. So Steve -- looking at it from afar. What are the odds of them coming back with a deal by November 23. You know I think it will should be openly do you want kind of be disappointed and it an optical BI exchange and I've -- here I it will also AG this is about they could do itself. I'm I'm looking for May be a minimalist deal. But that's the only scratches the surface of what needs to be done to bring -- -- -- outs. Steve I heard something on the estate tax front have you heard any have rivers on the estate tax issue. Well right now. I'll -- -- I did hear something about at what they're talking about is Republicans won a lot -- 35% rate what you think you know that's a little higher than I'd like I think maybe twenty personality got a lot but Democrats want 45 to 50% so that's what there are very about it and the exemption would be somewhere around 500000 dollar. Yet that's what I heard that the exemptions not going to be this five million dollar number that we've got out on its common way -- now. Boy hey always agency Steve I hope you'll stay with us and stay. Keep sit up to date I'll be read your articles every day looking for news -- Program. Folks at. He's wired into this committee and Steve Moore from the Wall Street Journal he's got to read his stuff will make sure it gets posted on our FaceBook real money website. Lunch money and -- Bjork Leo dot com is also our email address up next we're going to be talking about. Investing that's right -- be chatting with Harry milling for Morningstar about some mutual funds get your pen and Paper ready. Would you via the names of the mutual funds along with their symbols. That's next on Boston stock station in 680. WRK.