Bill Moyers considers what we can do to repair the US economy. Among those who discuss potential solutions to problems facing the American economy are Robert Kuttner, co-editor of The American Prospect; Henry Nau, author of The Myth of America’s Decline; and Patricia Saiki, head of the Small Business Administration.
BILL MOYERS: How does the American economy look to you?
ANTHONY AMERALIS, Comic Book Shop Owner: Lousy. Very lousy.
BILL MOYERS: Do you think it’s going to get better or worse?
LILY DRAGO, Shoe Repair Shop Manager: I hope it will get better, and I think it will get better. It’s supposed to get better.
GERALD HINDERSTEIN, Pharmacy Owner: I read about signs of recovery, but I haven’t personally seen any.
CINDY SCHNEIDER, Shop Owner: I thought it would be a little easier by now. I did.
DENIS REYNOLDS, Pub Manager: Years before, you could open the doors. If you keep things right you’re going to be busy, whereas now that guarantee really isn’t there.
ANTHONY AMERALIS: You know you can’t give up. And that’s what America should do, not give up. Go out, spend a little money so the economy looks like it’s trying to get back on its feet.
BILL MOYERS: [to newstand worker] How’s business?
Tonight, “Curing the Economy.”
I’m Bill Moyers. Welcome to Listening to America. As just about everyone knows, the American economy is doing poorly. Growth is sluggish, new jobs are being created far too slowly, in-equality is increasing, and our relative decline is such that by the year 2000 the United States could be a second- or third-ranked power economically. Even if we put the current recession behind us, fundamental changes in the global and domestic economy could leave Americans at a disadvantage.
Several weeks ago on Listening to America we looked at the Philadelphia Inquirer series “America: What Went Wrong?” The book based on that series by investigative reporters Donald Barlett and James Steele is now on the best seller list. They spent two years trying to find a pattern to the economic chaos of the 1980s. Some of the answers they found are in what they call the “Government Rule Book,” the laws and regulations written in Washington that govern the American economy. Those rules and regulations, they say, have rewarded companies that transferred jobs abroad and eliminated jobs in this country. The result is to undermine long-time stable businesses and communities, and to dismantle the middle class, leaving once prosperous American workers out of work and out of hope.
We met some of these people. Here are excerpts from “America: What Went Wrong?”
LARRY WEIKEL, Laid-off Worker: I never ever thought that I would be fired. I never ever thought that the job would come to an end. I never ever had an idea about anything like that.
BILL MOYERS: In 1966, Larry Weickel took a job here at the Diamond Glass Company. With only a 10th grade education, he worked his way up the ranks and had achieved a secure middle class life. When the company closed its doors in 1990, Larry was out of a job.
LARRY WEIKEL: Are you going to bring them? Come on.
BILL MOYERS: And now he worries about his grandchildren.
LARRY WEIKEL: Take them down the cellar.
MRS. WEIKEL: Go down the cellar.
LARRY WEIKEL: I don’t know how the young children are going to do it.
Can we draw a picture of a rock star?
MRS. WEIKEL: Look over there in that box over there and give me the other glue, okay?
LARRY WEIKEL: They’re going to have to have an education. They’re going to have to be professional people. They’re cutting out the middle class people, and I feel there’s going to be rich folks and there’s going to be poor folks, and I’m the poor folk.
MRS. WEIKEL: Is that you? Look at that big ear.
MRS. WEIKEL: Ooh, that’s a nice one, Greg.
LARRY WEIKEL: I don’t see how any of my family is going to come up with the money needed to send these kids to school and to get their college education. I thought I was going to have it nice, and I wouldn’t think anything of sending one of my grandkids to college, because I figured I’d have some money when I retired, you know? But I’m using it up as quick as you know – get my hands on it now. You know it’s a little tough now.
BILL MOYERS: Meet Edwin Bohl of Herman, Missouri. Like Larry Weickel, Ed and his wife, Geraldine, have seen the future, and it doesn’t work.
EDWIN BOHL, Laid-off Worker: I worked for Florsheim 37 years all total from the day I started until – In fact, it was just a little over 37 years by the time we finished up in February the 28th, 1988.
BILL MOYERS: Announcement of the closing of the Florsheim plant came without warning just before Christmas.
EDWIN BOHL: We were given a very, very short notice. Shortly after I – Everybody was in the plant they called a meeting, and we were told right then that the plant was going to be closed, and that there would not be no jobs held for nobody, and that there absolutely was nothing wrong with our work. We had number one work out there. Their cost was in line with everybody else’s and that, but it was just one of those things that we were chosen to be closed.
GERALDINE BOHL: When he called me about 1:30 he was crying, and I cried.
EDWIN BOHL: And I would say the saddest part was when everybody left.
BILL MOYERS: Diane Johnson, her husband, Toby, and son, Joshua, used to lead a normal life in the small, closely knit town of Ravenswood.
TOBY JOHNSON, Laid-off Worker: When does this have to be in?
JOSHUA JOHNSON: Wednesday.
BILL MOYERS: Toby had followed in his father’s footsteps and taken a job at the Kaiser Aluminum plant.
TOBY JOHNSON: So these are the classes that you’re going to have to start taking?
BILL MOYERS: He worked there 25 of his 43 years, and was able to provide a good life for his family. All that ended in the 1980’s. The company changed hands three times. When it was purchased in 1989 in a leveraged buyout and renamed the Ravenswood Aluminium Corporation, that’s when the big trouble started.
TOBY JOHNSON: People need to wake up. They need to wake up and see what’s happening. Do they want to make minimum wage for the rest of their life, with no retirement, no health benefits, no safety in the workplace? And that’s’ what it’s coming to, and that’s what this company is trying to do to us.
BILL MOYERS: Mollie James lives in Paterson, New Jersey. She worked at Universal Manufacturing for 33 years. Starting out as an assembly line worker, she rose to become the only female operator of a large metal stamping machine.
MOLLIE JAMES, Laid-off Metal Worker: Yeah. I’m fine.
BILL MOYERS: Mollie’s former employer, Universal Manufacturing, was bought by a company called MagneTek, Inc., controlled by a millionaire California investor named Andrew Galef. After Galef bought the company, he fired Mollie James and 500 other workers. He then transferred the manufacturing to Arkansas, where the wages are lower, and on to Mexico, where they’re even lower.
MagneTek’s plant is located in the border town of Matamoros. Some of the employees live next door in this shanty town. While Mollie James earned $7.61 an hour, many of these people make $1.45 an hour. The Mexican side of the border that runs from California to Texas has become a highway of Fortune 500 companies. MagneTek has joined 1,800 other American plants that have moved there since 1965. All are part of Mexico’s Maquiladora program, which encourage U.S. assembly plants to locate south of the border.
In 1989, MagneTek, in a report filed with the Securities and Exchange Commission, cited the benefits of this low-wage haven. “The company has consolidated manufacturing, and relocated product lines to facilities having lower per-unit labor and overhead costs. For example, the company has established a full-scale manufacturing facility in Mexico, where it benefits from lower wage rates.”
If people are benefiting from this, it’s not American workers. With few exceptions, these new plants are replacing the ones back home that once provided them with jobs.
MOLLIE JAMES: [on phone] Yes, this is Mollie James. I…
BILL MOYERS: Mollie James, who was left with no health insurance and a pension of $73.21 a month for her 33 years of service, has a lot of unanswered questions.
MOLLIE JAMES: -newsboy had to cancel.
I would like to know why are these things happening, if the government are allowing these things to happen, to – All the jobs are going to Mexico, all the jobs are going to foreign countries. Why can’t not something be done about it? This is not a lower-income level that I’m talking about. I do not consider myself being a lower income. I’m a middle-class income. I worked to be a middle-class income. And it’s not only happening to me, it’s happening to so many of the middle-class incomes that I would like to know what can be done about it, or is the government doing anything about it?
BILL MOYERS: [on camera] After that broadcast aired, I invited several investors and industrialists to join us to discuss the issues raised by it, men and women who had been featured in the broadcast. The only one who accepted is with us in the studio now, Andrew Galef. He’s the Chairman of MagneTek. Mr. Galef, Forbes magazine described you as one of the good guys. It says Andrew Galef likes to take failing companies and turn them around, build them up into strong and healthy enterprises. Why then did you close down the plant in Paterson and move Mollie James’ job to Mexico?
ANDREW GALEF, Chairman, MagneTek, Inc. : Well, Bill, to start with, I feel very sorry for Mollie James. I feel very sorry for the other people that were depicted on the review that we just saw. But Mollie James’s job was not my decision. It was not my decision at all. The two major competitors of MagneTek, in the products that were produced in the plant in Paterson, in 1987 and 1988, opened large facilities in Mexico.
BILL MOYERS: Competition.
ANDREW GALEF: Competition. They started lowering the price of the pro-ducts that we were manufacturing. Mollie James’s job was lost the day that those people opened those factories. All we did was competitively respond to a situation so that we could stay in business for the benefit of the balance of our workers. MagneTek today – back in 1984 when it started, MagneTek had 1,200 employees. Today, MagneTek has 16,000 employees worldwide.
BILL MOYERS: Worldwide. How many in this country?
ANDREW GALEF: Ten thousand in this country. So this is one of your American success stories. I mean this is not a company that arbitrarily goes out and fires people, arbitrarily closes plants.
BILL MOYERS: You’re saying you had no choice if you were going to protect the rest of your enterprise than to close this plant down.
ANDREW GALEF: Well, but we would have been out of this business anyway had we not moved it. I mean you have to be competitive. There started – there were six companies that made the products that were made in Paterson, New Jersey. It got down to three through some consolidations, and two of those three went south of the border with plants manufacturing this product. They went there when labor was 55 cents an hour. So they created a competitive situation. And to meet that competitive situation, we were forced to move things around. It’s very expensive to move a factory, and it’s very expensive to train new workers. Nobdy does that arbitrarily.
BILL MOYERS: Why wasn’t it possible to train – retrain Mollie James there in Paterson for a different job with the company?
ANDREW GALEF: Oh, I would have loved to, but we didn’t have any other jobs in Paterson. What we did was we kept the distribution center so we’d keep part of the people employed. We met with the town fathers. We met with the mayor. We met with the representatives of the union. We did everything within our power. We also worked with the State of New Jersey in getting the people retrained. I mean we did everything that we could do as a responsible corporate citizen in terms of trying to retrain people in New Jersey whose jobs they lost through no fault of their own.
BILL MOYERS: Well, she feels, and the others feel, that Barlett and Steele talked to, that they’ve been – they’re throwaways, that they’ve been dumped. It’s too late to start over in their lives.
ANDREW GALEF: Well, I – Bill, I don’t think any human being is a throwaway.
BILL MOYERS: But they feel that though.
ANDREW GALEF: I understand. And I would feel that way,” I guess, if somebody came in one day, even though they gave me six months notice, and said, “I’m sorry, you’re going to be out of work.” I would be hurt. I would be angry.
BILL MOYERS: You found that anger out there, didn’t you?
JAMES STEELE, “Philadelphia Inquirer,” Co-author, “America: What Went Wrong? : We found that anger out there. And contrary to what Mr. Galef might think, there’s much in the book he probably would agree with, because what we write about in the book is the fact that the “Government Rule Book” has encouraged precisely the movement of companies outside the United States.
BILL MOYERS: How did it do that in his case? How did the “Government Rule Book” encourage –
JAMES STEELE: Obviously there’s a low tariff on bringing in manufactured goods back in from Mexico. You’re responding to your competitors going abroad. But the fact of the matter is what is going to happen to jobs ultimately in this country down the line? Unless we create, or preserve the manufacturing base we have, there aren’t going to be any jobs for somebody like Mollie James. You talk about the global economy, which is usually the explanation for why much of this goes on, and it’s particularly applied to something like the Ma-quiladoras and the free-trade agreement with Mexico. Look at Mollie, $7.91 an hour. That’s after 32, 33 years. That translates into an annual wage, $16,000 – $17,000 a year. That’s half the median family income in this country. Are we saying that every manufacturing job that pays $16,000 or $17,000 is too high a wage a job?
BILL MOYERS: What about that?
ANDREW GALEF: I think that, you know, a lot of the things that you wrote in your book are true, and I don’t disagree with you. I don’t think that there is a level playing field. I never thought there was a level playing field. And so, you know, if we take that as a premise, my question to you is what would you do about it? In your book, all you do is talk about what’s wrong, what you think is wrong. You blame American business, you blame, you know, the American government, and you offer no suggestions. Now, tell me what you do when you have an American public that wants the best product that they can get for the least money – and tell me how you preserve jobs if you’re not giving them the best product for the least money. American consumers are the ones that bought Japanese cars. Tell me how you compete with that.
DONALD BARLETT, “Philadelphia Inquirer,” Co-author, “America: What Went Wrong?” : If this continues, you’re looking at a country which is going to have 50 million to 75 million people at the bottom of the economic pile, who are being told, “That’s it. We’re sorry, but that’s your problem.”
JAMES STEELE: There’s no jobs.
ANDREW GALEF: Well, I think that you know one of the things that has happened is we’ve had a technological revolution, and it requires less people to produce the same products as it did in 1950, so I think you at least have to factor that into the equation.
DONALD BARLETT: No, I don’t think so.
JAMES STEELE: But – But you had that in the past, too.
DONALD BARLETT: No, you had an increase – you had an increase in productivity in the ’50s, and the ’60s, and the ’70s, but you also had an increase in jobs in the ’50s, and the ’60s, and the ’70s that is missing today. And it’s missing because we’re not creating the new businesses, the new industries, the new manufacturing processes, the new technologies that provide the employement that was provided in those decades.
ANDREW GALEF: But why aren’t we providing that?
DONALD BARLETT: Because – well, that’s where we go back to what we call the “Government Rule Book.” The short-term psychology that calls for a return this year or this quarter rather than ten years from now.
BILL MOYERS: Mr. Galef, the question that comes to my mind watching – hearing you and then watching and thinking about those workers is: does American business have any loyalty to the American worker any longer?
ANDREW GALEF: Oh, I think American business has an enormous loyalty to its workers. We’re dependent upon our workers for our success.
BILL MOYERS: Not Mollie James.
ANDREW GALEF: Oh, as I said before, Bill, I didn’t like what happened to Mollie James. As a matter of fact, it’s always been gut wrenching to me. And if you go back into my history you’ll find out that since 1965, I was a corporate turnaround specialist, savings jobs for people. I find it gut wrenching every time that you have to talk about letting people go.
BILL MOYERS: Could something have been done for her and her colleagues? She’s sort of a metaphor to me of the process at work in the country that you have described. Could the “Government Rule Book” be rewritten in a way that would provide you an incentive to have kept Mollie James and others at work? Can we do better?
ANDREW GALEF: I think the answer to that is anti-American.
BILL MOYERS: What do you mean?
ANDREW GALEF: The only way that you could do that is to subsidize American industry.
BILL MOYERS: We do it all the time, don’t we in different forms?
ANDREW GALEF: In different forms, but you know – but to give direct subsidies to companies in order to maintain an employment level in order to have them competitive. I mean, you’re going to get into such a complicated situation that, I mean, it would be impossible.
DONALD BARLETT: I don’t think anyone –
JAMES STEELE: I don’t think anybody’s talking about direct subsidies.
DONALD BARLETT: – anyone would argue that, but I don’t think we should be subsidizing the moving of the factories offshore. And contrary to what Mr. Galef said-
ANDREW GALEF: Nobody paid me to move a factory offshore.
DONALD BARLETT: Well-
ANDREW GALEF: If I manufacture parts in the United States and assemble them in Mexico, and bring them back into the United States, the parts go over in bond-
JAMES STEELE: Exactly.
ANDREW GALEF: -and they come back.
JAMES STEELE: That’s right.
ANDREW GALEF: And so I don’t pay taxes going into Mexico or back from Mexico.
JAMES STEELE: Right. Exactly.
ANDREW GALEF: What – that’s not subsidizing me. If I manufactured the thing in Mississippi, which I do, I don’t pay any taxes when the stuff goes from Arkansas to Mississippi and back to Arkansas.
JAMES STEELE: But Mexico is not part of the United States.
ANDREW GALEF: Well, what you’re arguing for, again, I think, is that what we should have is an isolationist economy.
DONALD BARLETT: Oh, absolutely not.
JAMES STEELE: No, no.
DONALD BARLETT: Absolutely not.
JAMES STEELE: I think any time anybody raises this question
ANDREW GALEF: Well, then tell me-
JAMES STEELE: -the idea-
ANDREW GALEF: Tell me why the stuff.-
JAMES STEELE: -the idea-the idea of these two extremes-
ANDREW GALEF: -why the stuff going back and forth across the border should be treated any differently than the stuff going between Mississippi and Arkansas. I mean, tell me how you remain competitive in this world, and produce products for the American consumer at a price that the American consumer wants to pay.
BILL MOYERS: On that question, which is the question this country is debating now, and will be debating for some time to come, we’ll end this discussion and return to it with some other guests in a few moments. Thank you, Mr. Galef, for coming to tell this side of the story. And thanks again Don Barlett and James Steele for being with us today. You can find out more of their reporting in this – in their book, America: What Went Wrong?
To discuss the economy at large, I like to start by looking around in my own neighborhood. So recently I decided to take a stroll down the block where I’ve worked now for almost 22 years. I wanted to find out what the local merchants, many of whom I know, had to say about the economy. It was a typical day on West 57th Street here in New York City. My first stop was at a small store right across from the office, where Anthony Ameralis recently opened for business.
ANTHONY AMERALIS: How are you doing?
BILL MOYERS: Anthony is 25. He buys and sells comic books and trading cards.
How long have you been in business here, Anthony?
ANTHONY AMERALIS: Here, I only been in business for about a month and a half.
BILL MOYERS: But you-
ANTHONY AMERALIS: But I been – my family has a business on the same block. I mean I been on this block since I’ve grown up. There’s been big changes. I seen more people close their doors than open them, and I don’t like the way that looks.
BILL MOYERS: From where you see it, how does the American economy look to you?
ANTHONY AMERALIS: Lousy. Very lousy. I mean for me to go out now and spend money, I have to think twice. I used to be the type of person to go out and spend and worry later, and now I worry before I spend the money.
BILL MOYERS: How can you tell that things are bad?
ANTHONY AMERALIS: Well, I’ve been seeing a lot of people coming in, bringing their, you know, loved collections that they’ve had for years, and they have to give them up because they don’t have the money to put food on the table.
BILL MOYERS: Really? They – they’re selling their-
ANTHONY AMERALIS: And they’re taking anything. You know I don’t gyp people. I try to give the best I can. And they take it you know because they say, hey, little Joey or little Susie, they need their food. Or like this past week was Easter. People didn’t have money to buy eggs, dye, or little chocolate bunnies to make their little kids you know, have a holiday. And to me that feels – you know it makes me feel really bad.
BILL MOYERS: You’ve started this business right in the middle of the recession. Why? It must have taken either-
ANTHONY AMERALIS: Took a gamble, because I figure maybe somehow things are going to get better. Right now it looks very iffy, but I’m very strong. You know I’ll try whatever I could do. You know you can’t give up. And that’s what America should do, not give up. Go out, spend a little money so the economy looks like it’s trying to get back on its feet. Not hold everything. You know, zip open those mattresses, take the extra dollars out.
BILL MOYERS: Lily Drago is the part-time manager of a shoe repair store.
How long have you been working in this neighborhood?
LILY DRAGO: Oh, at least 10 years here.
BILL MOYERS: So you saw the good times in the ’80s when business
LILY DRAGO: Oh, yes. Yeah, it was very nice. But lately, it’s – the economy, everything is just down, and people don’t have the money to come in and buy things, or even repair. You should see, they come with shoes in, they have holes in their soles. People don’t have the money to repair shoes today. It’s so awful.
BILL MOYERS: I would have thought the shoe business was recession-proof.
LILY DRAGO: Exactly.
BILL MOYERS: That people had to have shoes, and had to have them repaired.
LILY DRAGO: No. They try to. People come in and they don’t have the money, they leave their shoes. We have shoes left over from a year back. They don’t pick up their shoes. They don’t have the money to pick up even their shoes. We thought perhaps the summer will come out. We bought all kinds of shoes and nothing sells.
BILL MOYERS: And these loafers, they are what? How much do they cost?
LILY DRAGO: They are now on sale for $20.
BILL MOYERS: And they’re not selling.
LILY DRAGO: No, no. They’re not selling. Nothing sells. Like today I didn’t sell even one pair shoes.
BILL MOYERS: No kidding.
LILY DRAGO: Not one pair.
BILL MOYERS: All the day?
LILY DRAGO: A whole day.
BILL MOYERS: It’s four o’clock in the afternoon now.
LILY DRAGO: Yeah. Not even one pair.
BILL MOYERS: Trio Pharmacy has been a neighborhood fixture for 23 years. Gerald Hinderstein is the pharmacist who owns the store.
How’s the economy treating you?
GERALD HINDERSTEIN: Well, up until two years ago, I think the economy was treating us very well. This particular area was really booming. But it seems the last two years – first it got flat for about a year, and now it seems to be going downhill.
BILL MOYERS: What about your customers? People not spending as much money?
GERALD HINDERSTEIN: Absolutely. They’re – they’re-
BILL MOYERS: Not buying what?
GERALD HINDERSTEIN: Impulse items, like perfumes, expensive hair brushes. All the various, what we call, impulse items that we were – you know hope they would buy while they’re waiting for their prescriptions, that business is almost nonexistent now.
BILL MOYERS: What do you think it will take to turn things around?
GERALD HINDERSTEIN: Political leadership that’s more interested in solutions than in what’s to blame for the problems.
BILL MOYERS: As a businessman, are you – do you see any signs of recovery? Do you – are you optimistic? You don’t.
GERALD HINDERSTEIN: I read about signs of recovery, but I haven’t personally seen any. I see the stock market going to all-time highs, and I see where every, almost every company, except drug manufacturing, are having problems. So that’s another mystery to me.
CINDY SCHNEIDER: The Post Office requires me to have this-
BILL MOYERS: Cindy Schneider and her husband, Jeffrey, opened a franchise of Mailboxes Etc. two years ago. They provide their customers with postal, business, and communication services.
Are you where you thought you would be at 31?
CINDY SCHNEIDER: I’m proud of myself in that I own my own business, I’m a college graduate, we own a condominium, you know, we have our car payments, but I thought that I would be – it would be a little – each month I wouldn’t have to sweat it out the way I do each month. I mean, it is quite a struggle trying to borrow from Peter and paying Paul. Sometimes you don’t know who Peter is. You don’t know when he’s coming up so you could borrow from him. But I thought it would be a little easier by now. I did.
BILL MOYERS: What happened that you didn’t anticipate?
CINDY SCHNEIDER: Good question. I – in general I guess it’s the economy. What happened is that maybe more people are out of work. People don’t even have enough money to take care of the basics that they need, like health insurance, like car payments, like the basics. So they’re definitely not going to come here and for convenience, pay a dollar more for a book of stamps.
BILL MOYERS: Is it close for you and your husband every month?
CINDY SCHNEIDER: Yes, yes. We’re – we’re treading water. We’re doing it. We’ve been here for two years, and you know, I plan to be here a lot longer. I just thought I would be breaking even a lot sooner, like, to start making a profit.
BILL MOYERS: “D.J. Reynolds” is the Irish pub and restaurant on 57th Street, right next door to our station. Denis Reynolds is the manager.
DENIS REYNOLDS: Well, this is a family business. And I grew up with my family downtown, and I just basically was raised in it.
BILL MOYERS: Do you think your father had an easier time in that economy than you do?
DENIS REYNOLDS: Well, when I always – when I talk about this with my dad, as things were just, again, entirely different, that spending was different then. Business was just better, and people weren’t as conscious of what was spent during the day or during the year, and they weren’t as conscious of their family budget as they are now. And in the restaurant business you have to be very careful because if – when the family sits down and maybe you know, husband and wife talking or whatever, they’re saying, “Well, we’ve got to cut back on things,” and I think the first glaring thing in anybody’s budget is probably-
BILL MOYERS: Eating out.
DENIS REYNOLDS: -a restaurant. Eating out. Surely. You know, we’ll get – we’ll get some pizza and we’ll watch the VCR at home or something.
BILL MOYERS: Is business flat now?
DENIS REYNOLDS: It’s harder to get better. It’s harder – I think you have to work harder now. It’s not as easy to acquire new business as it was before. That’s what I was saying before that years before, you could open the doors. If you keep things right you’re going to be busy, whereas now that guarantee really isn’t there.
BILL MOYERS: [in studio] We’re going to, hopefully, discuss some solu-tions, some answers to the dilemmas you’ve seen so far in this broadcast. We have four people who have some quite different ideas about how we can cure the economy. Robert Kuttner is co-editor of The American Prospect Quarterly. He writes a syndicated column on economics, and he’s the author of The End of Laissez-Faire, National Purpose and the Global Economy After the Cold War. Bob Kuttner, is this recession, these business – local business folks were just talking about a temporary dip in the economic cycle?
ROBERT KUTTNER, Co-Editor, ”The American Prospect,” Author, ”The End of Laissez-Faire”: I think the problem is less the recession than the fact that we are now stuck in a plateau of slow growth. Since ’86, ’87 the economy has been growing at less than 2 percent a year on average, barely keeping pace with the growth of population, and whether or not the measured recession is about to end or not, this bout of slow growth doesn’t seem to be about to end. And when you have slow growth, it doesn’t produce the good jobs and the rising incomes that people expect.
BILL MOYERS: I was going to ask, what in practical terms does, quote, “slow growth” mean?
ROBERT KUTTNER: It means that the economy barely treads water. It means that real incomes stagnate, or don’t rise, and unlike the great post-war boom, it means that living standards don’t double every generation, which they did in the ’40s, and ’50’s, and ’60’s.
BILL MOYERS: So the standard of living-
ROBERT KUTTNER: Stagnates.
BILL MOYERS: -either remains flat, or actually diminishes if inflation is rising.
ROBERT KUTTNER: Well, for about 60 percent of the population in the past decade it has diminished slightly.
BILL MOYERS: Patricia Saiki is head of the U.S. Small Business Administration. Her constituencies include those people you saw on West 57th Street a moment ago. She’s a former member of Congress from Hawaii, and now directs programs and services designed to promote and expand small businesses in the United States. Ms. Saiki, do you agree that this is something more serious than a temporary dip in our – in our economy, that there’s something fundamental going on here?
PATRICIA SAIKI, Head, U.S. Small Business Administration: Well, I think the main thing is that we’ve turned the corner on the recession, and the growth may be slower than we would want, but there is still growth. Now, all of your people on 57th Street, I mean they’re the real entrepreneurs. They’re the people with the spirit you know. They’re going to hang in there. None of them are going to throw in the towel and quit.
BILL MOYERS: Now you smiled a moment ago when the young man who sells comic books across the street said-
PATRICIA SAIKI: That’s right.
BILL MOYERS: – America can’t quit.
PATRICIA SAIKI: Right. And that’s the spirit that is going to see this country through. Because it is the small business sector that makes up – creates actually 50 percent of the national work force, contributes 39 percent of the GNP, and 45 percent to 50 percent of all Consumer sales. So as long as we encourage those small business people to hang in there, and we in government contribute to assisting them in succeeding, this country is really going to take a better turn and grow.
BILL MOYERS: So hanging in there means what practically? I mean how long do I go across the street after this and tell them Ms. Saiki says if you’ll just wait three months, four months, six months, everything’s going to be OK?
PATRICIA SAIKI: Well, I don’t think those people are ready to quit listened to them, and they’re not ready to quit. And if you were to tell them to hang in there, they’ll probably nod their heads.
BILL MOYERS: But you see the problem, it seems to me, is that if business gets better for my friends on West 57th Street, the Mollie Jameses of the country, the people we saw in the first part of this broadcast, can’t come in there and buy the shoes, buy the drugs. She’s really not a potential customer for these people if the recession gets better.
PATRICIA SAIKI: Well, I would say that if a Mollie James is going to be picked up by another small business that will grow in another area of the country, we can then employ these people. You know two out of three of the new jobs created are in small business, and so there is always hope for these people to become trained, to start in a different kind of job, as long as we keep the small business sector alive and well.
BILL MOYERS: Someone who disagrees with you, I think, is Richard Goodwin. Dick Goodwin began his career on the staff of Senator John F. Kennedy. He worked in the Kennedy White House, and later helped develop Lyndon Johnson’s domestic programs. He’s the author of a forthcoming book called Promises to Keep.
You say in that book – I read the galleys the other day – that the term “recession” is just a relic of an America that has receded into history. So you don’t think things – this is just a temporary blip.
RICHARD GOODWIN, Author, “Promises to Keep”: I don’t think that, Bill. I think that it may be true that what goes up must come down, but there’s no parallel law of anti-gravity that says what goes down must come up. And the fact is that the underlying – the underpinning of the American economy is its ability to create wealth, which is basically through manufacturing. There’s been a steady diminution of that capacity. In 1960, 26 percent of our work force were in manufacturing. Now it’s about 15 percent. And since that fundamental ability to create wealth, we heard about companies going to Mexico, that’s not creating wealth for Americans or American workers, although there may have been good reasons to do it – since the ability to create wealth and capacity to create wealth has diminished, I don’t think that you’re going to pull out of this decline unless you restore that ability. And I think we’re just headed right – and we may have temporary blips like we may even be having now, although I don’t think you can take the economy’s temperature every week and have anything meaningful. I do think that we’re in for a long-term decline without a drastic change in politics and policy.
BILL MOYERS: When I read your book, I thought, the sun is sinking. Then I read Henry Nau’s book. Henry Nau is the professor of Political Science and International Affairs at George Washington University. He served in the State Department and on the National Security Council under Reagan, I believe, and is the author of The Myth of America’s Decline. And when I read your book, Dr. Nau, in contrast to Dick’s, I said Goodwin says the sun is setting, Nau says the sun is rising, that the decline of America is a myth. What about that?
HENRY NAU, Professor, George Washington University, Author, “The Myth of America’s Decline”: Well, I think we’re on the verge of losing perspective in this country, which are prone – we’ve been prone to do historically. We have to start from the fact that America still is the wealthiest country in the world. Our absolute productivity is higher than any other country. Japan has only about a 60 percent – in absolute productivity only about a 60 – 60 percent of the level of the United States. Even in manufacturing, we have – they have only about 80 percent of our level of productivity. Now that’s a major measure of competitiveness. We’ve just emerged from the longest period of peacetime growth in this country, where growth rates overall from ’83 to ’90 were higher than they’ve ever been in the postwar period.
Now, this – this recovery is different because we are emerging with a lot of debt. Consumers and companies incurred a lot of debt during the course of the 1980s. It’s going to take us longer to work those debt levels down. The only player in the economy which is not working down its debt levels, which is absolutely essential if we’re going to get a rebound in this economy, is the U.S. government. If you want to deal with one government rule that is affecting the marketplace, it’s our fiscal policy. Since the early ’70s we’ve had no fiscal policy in this country, and it’s interesting that the decline in the living standard –
BILL MOYERS: By fiscal policy you mean – let’s make sure we know what you mean. By fiscal policy you mean –
DR. HENRY NAU: I mean the deficit. I mean the fact that the government has been runningï large deficits, and has been borrowing on private markets, and therefore drawing capital away from the small entrepreneurs and from American companies, raising the cost of that capital, which has been a major self-inflicted disadvantage that we’ve had in the course of the 1980s. And that’s one of the problems of the 1980s. I’m not trying to, you know, gloss over the difficulties, but I am trying to also look at the achievements.
BILL MOYERS: Andrew Galef said earlier that – he went beyond fiscal policy. He said something is happening fundamentally in the world, and he was sort of pessimistic about that. In fact, as he ended that discussion with that question of his, “How are you going to compete?” I wondered if you were watching. Who won that debate in the first – of that discussion, in the first part of-
PATRICIA SAIKI: There’s no question. Mr. Galef won that one.
BILL MOYERS: Do you think that, Henry?
DR. HENRY NAU: I think so. I think the question is how to create wealth
RICHARD GOODWIN: Oh, I think he won the debate, but I – he won the debate because he obviously can’t compete with other countries that go to Mexico if he doesn’t.
BILL MOYERS: Did he win the debate?
ROBERT KUTTNER: He won the debate in one sense only, and that is you can’t solve the problem in one company. That is, if his competitors move to Mexico, and the rules of the game are such that instead of creating high-wage jobs at home you simply move the wages offshore, he has to follow. So to villainize him misses the point. The point is how do you recreate high-wage jobs at home?
BILL MOYERS: In answering that question in your recent book, you call for more government control over the American domestic economy, and more regulation of the international economy.
ROBERT KUTTNER: Well, I think there are three things I’d call for. First of all, a high-wage strategy at home. You can compete by working smart, or you can compete by working cheap. The Germans have the world’s highest paid workers, and they have a favorable balance of trade in industrial goods. They don’t compete by working cheap. They compete by working smart. The Japanese do the same thing. If we try to compete by lowering our wage levels to the levels of Mexico or Honduras, we only impoverish the American workers, otherwise known as the American citizens. So I have a very simple three-point program: You compete by working smart rather than by offshoring jobs; you demand fair trade, which means that if we are to have open markets, our competitors are to have closed markets, or, conversely, if they are allowed to be economic nationalists, we’re allowed to be economic nationalists; and the third thing you do is you restore the level of public investment to what it was during the boom years of the ’50s, and ’60s, and ’70s.
BILL MOYERS: Spend more money on-
ROBERT KUTTNER: Not very dramatic stuff, on the one hand – roads, bridges, sewers, water treatment facilities, rails. Rebuild all the public infrastructure that lost resources in the ’80s, and then some high-tech stuff, too, high-speed rail.
BILL MOYERS: Patricia Saiki, does this amount of government intervention in the economy that Bob Kuttner calls for satisfy you, or alarm you?
PATRICIA SAIKI: Well, I think what Bob is talking about is the future, which will be a different marketplace. It’s going to be a global marketplace. So that the policies of the past, as referred to earlier, have to be reviewed in terms of how we’re going to compete across the lines of various countries. And so I think that there is a definite effort by the Bush Administration to further the GAT negotiations, tie that down, looking at the NAFTA, which would be the North American Free Trade Agreement, start looking seriously with closing ranks with the Pacific Rim countries, and thereby develop fiscal policies and monetary international policies that are going to allow for this kind of competition, so that we will then be all competing on an equal level plain.
BILL MOYERS: But that’s not quite the level of activity that you’re calling for, and in your book, the subtitle of your book is Promises to Keep, A Call for a New American Revolution. Is this the revolution? Is this the extent of it?
RICHARD GOODWIN: No, I don’t think so. I think that – I mean, government is always interfering with business. After all, we did make government made an agreement with Mexico, which positively encouraged companies to move there, because they did it. And that’s the result of public policy. As a result, millions, or thousands of American jobs have been destroyed. That can be reversed. There’s no reason why we should allow companies to move to Mexico and not pay a price for it.
DR. HENRY NAU: Should we not allow the Japanese companies to move to the United States?
RICHARD GOODWIN: Well, I think-
DR. HENRY NAU: Do we want to stop all of this movement of international capital? They create jobs here in the United States.
RICHARD GOODWIN: I don’t know if we want to stop all the movements of international capital because you can’t, but I do think that we do need to – it’s one thing to have Japanese investment here, it’s another thing to have Japanese or German buy up American companies, like our film studios, because even though they keep American jobs, and even though they keep a flow of income going in the United States, the increment, which is the profits, goes back to Tokyo.
DR. HENRY NAU: But this is the mentality, though it seems to me, Richard, that that got us into so much difficulty, and got many of these countries that are changing their policies around the world into difficulty. This notion that somehow or other we’re going to protect the long-term job security and pay of individual workers. We cannot do that. There is a process of change taking place in the world. It’s driven by technology to some extent. It’s affected by a government policy to some extent. And I’m puzzled as to why, for example, Bob, you think that government can do so – can do a good job in dealing with selective industries, or in dealing with selective employment problems, when it’s done such a terrible job in terms of managing our fiscal policy. This is the same government we’re talking about. If it can’t manage its own budget, and that’s a big element that affects our economy, it affects the whole economy and the cost of capital-
ROBERT KUTTNER: Well, I – I
DR. HENRY NAU: -how can we have any confidence that that government is going to do the job [crosstalk]?
ROBERT KUTTNER: I would vote in – I would vote in a different government. I mean I’d just get rid of the Republicans. It was the Republicans. [crosstalk]
BILL MOYERS: You have an objection here.
ROBERT KUTTNER: I want to come back to trade because I think that’s the crux of a lot of this. Mr. Galef said one thing that I thought was just flat out wrong, and that was there’s no difference between moving product between Mississippi and Arkansas and between the U.S. and Mexico. We don’t have a single world government. We don’t have a single world court, a single world legislature. Mexico has a very different set of laws, labor laws, environmental laws, than we do. You can’t pretend that it’s one big world, one big country. And it seems to me that some of our trading partners who have succeeded have practiced what I would call a healthy kind of economic nationalism. And so if you’re going to trade with these people, you have to have some ground rules, Henry. You have to have some ground rules because the-
DR. HENRY NAU: We’re trying to establish them now.
ROBERT KUTTNER: Well-
DR. HENRY NAU: In the NAFTA.
ROBERT KUTTNER: But I think the Bush Administration
BILL MOYERS: NAFTA’s the North American Free Trade Agreement.
DR. HENRY NAU: The North American Free Trade Agreement. [crosstalk]
BILL MOYERS: Robert, [crosstalk] OK, but I think – I don’t think – I think we’re letting you off the hook, because he asked you how to you – he says you’re overestimating the feasability of organizing the American economic policy, let alone the world economy, when we can’t do very well with our own budget.
ROBERT KUTTNER: Let me take one sentence to finish the trade point, and then let me respond to the fiscal point, because they’re both separate points and they’re both good points. Japan is very strategic about what it moves offshore, what it moves to the United States or to Mexico, and what it doesn’t let other people do in Japan. It’s very hard to set up shop in Japan. About one-tenth of 1 percent of all the capital in Japan is foreign owned. Very difficult to compete, even if you locate your plant in Japan. The converse of that is when Japan locates facilities here, they’re often so-called screw-driver facilities, where the high end stays in Tokyo and the final assembly takes place in the United States. So if you’re going to pretend that it’s a single world, you have to at least have some ground rules that are fair ground rules.
Now, in the question of whether the government is competent to do anything, you know, it wasn’t the government that decided that Donald Trump was a real estate genius, or that Robert Campeau was competent to take over retailing in North America. This was the private market making mistakes, but nobody proposes to shut down Wall Street. The private market does some things stupidly. It does some things well.
DR. HENRY NAU: The private market, though, was seriously impacted adversely by government fiscal policy.
ROBERT KUTTNER: The government does some things well, and it does some things stupidly. And I would be the first to say that during the ’80s the government, which is to say the people who were in the White House, conducted fiscal policy stupidly.
BILL MOYERS: But when you call for government changing the administration, I have to realize – I have to admit that it’s been a Democratically controlled Congress that is as much a problem in controlling the deficit as it is the White House.
PATRICIA SAIKI: Oh, certainly. Certainly. I mean you can’t – We’re not going to sit here and play the blame game, are we?
BILL MOYERS: No, no. Let’s don’t do that. Actually, that’s – Where do we go from here?
PATRICIA SAIKI: Because I’d rather go – Where do we go from here? And I would reject the protectionist attitude or the isolationist attitude, which will not get us anywhere. I think it has to be a world conscience that’s going to drive trade relations, along with all other kinds of relations and understandings between our countries. I mean, take a look at what’s happened in Europe. I mean, those countries are trying to emulate and imitate us, because our basic policies, as we may argue have some weaknesses, are still basically very sound. And the competition out there in the marketplace, job creation, movement of fiscal policies, correcting our deficit problem as best we can – we’ve tried to for many years, we haven’t been successful. But I think that there is hope. There is a future.
DR. HENRY NAU: We have to – it seems to me we’ve got to keep the world in line here. I mean, I would hate to see America pursue policies in the belief that somehow or other we’re going to protect our people while letting poverty in the world just grow and expand. We have an obligation also to help these developing countries, like the one our border, to make progress. And the traditional way you’ve made progress is you’ve moved these low-wage manufacturing industries into those countries. Now, I think we’ve got to keep that going. We can modify the pace, but we’ve got to keep that going. Secondly-
BILL MOYERS: But what about Mollie James, though, Henry? I mean do just let the chips – let the chips fall-
DR. HENRY NAU: Well, let me – let me – let me – I was going to say, I believe government has a role to play. First of all, it’s got to straighten out its budget, and if it can’t do that, I don’t have a lot of confidence it’s going to do anything that’s going to help. But secondly, let the government do some-let the government get involved in retraining. There are jobs. We created 38 million jobs in this country over the last 20 years. That’s more than a 50 percent increase in our job market.
RICHARD GOODWIN: Let me agree with you before I disagree with you. I mean, I think the fiscal policy has been a disaster. We’ve piled up – added $3 trillion – we will have added $3 trillion to the national debt, we’re running a huge deficit this year, about $400 billion. The result is there is no money. There’s no money to do – deficit spending no longer has an impact on growth. I mean, we’ve gone beyond the limit, and the money that we need to do the kind of restoration you’re talking about, other than job retraining, is gone. But the second thing is, it is the job of the government not to protect particular individiuals, but to protect the standard of living of most Americans. It’s in the Preamble to the Constitution. It says we must protect the general welfare. That is government’s principal responsibility.
BILL MOYERS: OK. Let me just ask you to think of Ed Bohl, Larry Weickel, Mollie James, the unemployed workers you saw in that first piece in this show, and think of curing the economy that will help them, and give me some very – give them some hope with some very specific things you would recommend to cure the economy. Let’s just go around the table. What would you do to cure the economy, to help those people?
PATRICIA SAIKI: Well, we’re doing it right now in the Small Business Aministration.
BILL MOYERS: Which is-
PATRICIA SAIKI: It is a government agency, but we are getting out there to offer guaranteed loans-
BILL MOYERS: Taxpayer money.
PATRICIA SAIKI: – so that lenders.
BILL MOYERS: Taxpayer money?
PATRICIA SAIKI: Well, yes, but the leverage is 20 to 1ó
BILL MOYERS: OK.
PATRICIA SAIKI: – and we use private sector funds to start small businesses.
BILL MOYERS: OK, more loans to small businesses.
PATRICIA SAIKI: Right.
BILL MOYERS: Entrepreneurs. Henry Nau.
DR. HENRY NAU: Let’s encourage companies to invest in the retraining of their workers. The government can salt that process, but the resources should come from the private sector. And secondly, let’s look at the specific problem of the inner cities. Let’s decide perhaps, maybe it’s time to decide, that instead of giving people welfare, we’ll give them a job. And yes, the government will create the job.
BILL MOYERS: Well, so what if you-
DR. HENRY NAU: Temporary. Temporary. [crosstalk]
BILL MOYERS: What if you retrain people and then there are no jobs?
DR. HENRY NAU: Well, I’m just saying if we give them a job in the interim, all right, for a couple of years-
BILL MOYERS: What kind of job?
DR. HENRY NAU: I want that to be – Well, I think you could have them cleaning up the cities, building-you know the San Antonio canal is a nice product. It’s been with us for 50 years from the Conservation Corps back in the 1930s.
BILL MOYERS: Retraining and government jobs as they get taxpayer money.
DR. HENRY NAU: And give welfare recipients work, but only for a period of time, and then you expect them to find a place in the private sector. And you’re encouraging industry all the time to look at that pool of resources, as well as the retraining resources.
BILL MOYERS: Cure the economy, Richard Goodwin.
RICHARD GOODWIN: The fact is that the descent has been bad enough, and we’ve overspent and gone deeply into debt, that we are going to have to take a hit in our standard of living as an alternative form of investment for the future, or else we’re going to have to take a much hit further down. In other words, we’re going to have to – people are going to have to make a sacrifice in their own standard of living, the middle class, in order to rebuild this country.
BILL MOYERS: How? By paying more taxes? Giving up entitlements? Medicare?
RICHARD GOODWIN: Probably by paying more – some of it, yeah.
BILL MOYERS: Social Security?
RICHARD GOODWIN: There’s no choice
PATRICIA SAIKI: [off-camera] I want to-
RICHARD GOODWIN: -but to make a sacrifice. And I think if there were a real set of goals – I mean if a foreign enemy attacked us tomorrow, there’s no doubt you could get the American people to give up almost anything. Now, if we look upon this as the enemy within, as the famous cartoon character once said, “The enemy is us,” and you say, look, we’re going to wage this kind of a fight, but there has to be credible leadership, that people will do it.
ROBERT KUTTNER: Well, I don’t know if you’ve ever had anybody cry on this set, but I cry if a liberal Democrat of the stature of Dick Goodwin is saying that in order to rebuild the country the American middle class has to take a hit in their standard of living. I mean let’s go back to 1940, and your wife is writing a book about this.
RICHARD GOODWIN: I assume we’re all middle class.
ROBERT KUTTNER: In 1940, the economy was stuck at 11 or 12 percent unemployment, and growth was almost negative, and a foreign crisis came, and we rebuilt this country. We went way into hock, but instead of spending the money that we borrowed on gee-gaws, we rebuilt American industry, and the economy grew at the rate of 11 or 12 percent a year for four years during World War II. So I don’t think we need to take a hit to our standard of living. I think we need to start investing in people, in physical facilities, in industry.
BILL MOYERS: What does that mean, Robert? Specifically.
ROBERT KUTTNER: We need to retrain workers for high-wage jobs, take all the money we spend on welfare and unemployment comp and put people back to work rebuilding the country. Roosevelt got us halfway there during The New Deal. He got us the rest of the way there during the War. We need World War II without the war.
DR. HENRY NAU: Bob, I agree here with Richard. You see, I think this is the problem with traditional liberalism. It has always promised the American people something, and it has never demanded anything from the American people.
BILL MOYERS: What would you demand from them?
DR. HENRY NAU: I think – I think we’re going to have to demand that
BILL MOYERS: Very specific.
DR. HENRY NAU: Very specifically, entitlements. Is it fair that people in re-tirement making more than $50,000 a year-
BILL MOYERS: Medicare, Social Security?
DR. HENRY NAU: – yes – making more than $50,000 a year should not have – should still get Social Security when we only tax people to pay for Social Security up to a level of $50,000. Why not pare down the benefits after $50,000? There’s not-
BILL MOYERS: Because you’ll lose the race.
DR. HENRY NAU: No.
BILL MOYERS: You’ll lose the – any – If Bill Clinton or George Bush came out for that-
DR. HENRY NAU: Well, Tsongas talked about it in Florida, and he got – the first people in the line always get shot. But maybe he’s – maybe that’s an opening – maybe that’s an opening salvo. Maybe we’re going to get attention to that issue. And more and more people in Congress are talking about it. This is only the right thing to do. Americans will step up. I think that American middle class will step up and say, “OK, fine. We’ll do this for a better America.” This is the way you meet a challenge. We can’t recreate a World War II to mobilize the society but we need to be honest with our people.
ROBERT KUTTNER: I’d support – I’d support that as part of a program to rebuild the country, but to just hatchet Social Security and isolation, that’s just going to take a bite out of purchasing power.
DR. HENRY NAU: All right. Then let’s agree on that. Now, I would support your program to rebuild the country if the government simultaneously got its budget problem under control. I’m not sure we’d need the massive effort that you’re talking about.
PATRICIA SAIKI: Bill, you notice I’m not getting into this debate?
BILL MOYERS: You are not. You’re demurring very-
PATRICIA SAIKI: Yes. And I’m not demurring so much as – We can sit and talk in terms of ideas, everyone has a theory, and we’ve heard these discussions over all these years. But nobody is going to, as an elected official, take a position and cut out Medicare. You’re not going to see that. You’re not going to see them give up their pork barrel projects for dedication to infrastructure right across the country. So until we get a group of elected members of Congress, where fiscal policies are developed, where overall general policies are developed, we’re not going to see any changes. And so I’m not going to enter into this debate because I think the first thing the American people have to do is understand that unless we resolve the kind of leadership we’ve got in the Congress, we’re not going to see any change.
BILL MOYERS: Be very practical then. I required of them practicality. What would we do politically to get that kind of Congress? Who would we vote for or who would we vote against?
PATRICIA SAIKI: Well, you notice with the bank fraud case and all of these scandals going on in the Congress, the people who are running for office dedicate themselves that after they’re elected they’re not going to vote for – be with special interests, they’re not going to do this, but they’re all such shallow commitments. I think the voters have to look for solid citizens who have good, sound American democratic philosophies, who have courage, who have guts, who are going to stand up there and say, “I will do this job. I will not stay in there forever.”
BILL MOYERS: Say what?
DR. HENRY NAU: They ought to start listening to those Congressmen
PATRICIA SAIKI: They better start listening.
DR. HENRY NAU: – and those Senators who in fact tell them, “Look, you are going to have to make a sacrifice in order to get this country back on track.” I think they ought to start paying attention to those leaders, and out of them will come this kind of leadership. The American people are going to get what they want. That is, they’re going to get what the vote for.
BILL MOYERS: Where is political leadership coming from today? Do any of you see it anywhere?
RICHARD GOODWIN: Mostly from banks and big industry. I think that –
BILL MOYERS: Political leadership?
RICHARD GOODWIN: – we’ve got to realize that – the last – in 1988 –
PANELIST: He’s saying they run the country.
BILL MOYERS: Oh, you’re saying they run the government.
RICHARD GOODWIN: They run the politicians.
BILL MOYERS: That’s power, not leadership.
RICHARD GOODWIN: Well, that’s – I mean power when exercised is leadership.
PATRICIA SAIKI: Well, I think the Bush Administration is trying.
RICHARD GOODWIN: We spent $1.7 billion on elections in 1988, and you and I both know who that money comes from. Most of it comes from people who are making an investment, a business investment. And they get a return. And that’s part of the problem. The money power, as Madison predicted, has taken over the political structure, and unless we can eliminate that, and it can be eliminated, we cannot hope for a government that will do the kinds of things that anybody here wants done.
BILL MOYERS: This discussion comes back to what has been a recurring theme throughout the Listening to America series so far, that if we’re going to do anything, including cure the economy, we have to start with somehow getting excessive money out of the political process. And on that note, I want to thank you Robert Kuttner, Richard Goodwin, Henry Nau, and Patricia Saiki for being with us today. And thanks to you for listening to America. Let’s go out with some recent speeches by George Bush and Bill Clinton.
GOVERNOR BILL CLINTON: This is not working. It is not a Republican or a Democratic issue. It’s America against the rest of the world. Every other advanced nation is governed by a strategy for increasing growth, developing high-wage jobs through increasing investment and enhancing cooperation between government, business, labor, and education.
President GEORGE BUSH: We must have a short-term plan to address our immediate needs and heat up the economy. And then we need a longer-term plan to keep combustion going, and to guarantee our place in the world economy.
GOVERNOR BILL CLINTON: We need to grant every American the fundamental right to a good education in a world where what you earn depends on what you can learn.
PRESIDENT GEORGE BUSH: The workplace of the future will demand more highly skilled workers than ever, more people who are computer literate, highly educated. And we must be the world’s leader in education.
GOVERNOR BILL CLINTON: Second, we need to invest the time, the patience, and the money to rebuild our economy and make it grow again, with infrastructure and other investments here at home.
PRESIDENT GEORGE BUSH: And our new transportation bill provides more than $150 billion for construction and maintenance projects that are vital to our growth and well-being. And that means jobs building roads, jobs building bridges, and jobs building railways.
GOVERNOR BILL CLINTON: And finally, we must demand change throughout our entire society – from business, from labor, from government to work together to forge a new compact to promote economic growth.
PRESIDENT GEORGE BUSH: And we are going to lift this nation out of hard times inch by inch and day by day, and those who would stop us had better step aside, because I look at hard times and I make this vow, this will not stand.
You can view more about the Listening To America series on this website.
This transcript was entered on April 7, 2015.