`

tax reform

“Creative Destruction” In Trump White House

Is Larry Kudlow the next economic adviser for Trump? Does high turnover in the White House accurately mean chaos? Did Hillary Clinton’s comments about Trump voters being backwards give Republicans the opportunity to take back the position as the party for the common man? Are the states that Hillary won actually worse off? CNN Senior Economist, Steve Moore joins Dan and Amy to discuss. 

View full transcript


Proft: Good morning, Dan and Amy. Well, a lot of matters economic to discuss. Tangentially, as well as directly, personnel choices for the President to make, most notably to replace Gary Cohen as the top economic advisor. Border security, economic policy with respect to trading partners, the tariffs and the exemptions from those tariffs... Jacobson: The new branch of our military, the Space Patrol... Proft: The Space Force, how we're gonna finance our Space Force. I've suggested that Nathan Fillion, who commanded Serenity on Firefly, would be a good choice to head up that Space Force. And then, (to Amy) your former paramour, Captain...well, excuse me...ADMIRAL Adama, could... Jacobson: Right, I suggested him. Proft: Yeah, he could command Space Force One. Yeah. So we got a lot of slots to fill, that's the point, in addition to the foreign policy team shakeup. For more on this, we're pleased to be joined by Stephen Moore, Wall Street Journal Columnist, CNN senior economist, Heritage Foundation... Jacobson: All around good guy... Proft: New Trier graduate. Steve, are you going to be at New Trier today to join in the walkout and the T-shirting? Moore: Oh my gosh, is that what they're doing? I mean, it's just not the same school I was at 30 years ago. Good to be with you. I do think that...got a news flash for you...I think that Larry Kudlow will be the next National Economic Council Chairman. Proft: Your dream has been realized! Jacobson: Yeah, you said that last week, that you're pulling for him. Moore: I know, but I think it's getting closer, it's not a done deal yet but I just...I feel it. I think it's coming, and you've heard it first on the Dan and Amy show, but I think it is gonna happen in the next 48 hours. And I think it'll be awesome for the President, and I can't...I'm a little biased, Larry was the Best Man at my wedding, but he will be an awesome advisor to the President. He will communicate...is there a better communicator of economics than Larry Kudlow? Proft: No, he's great. Moore: He's been (?) about the tax plan, I'm just so excited about this, I hope it happens. Jacobson: But here's the thing, he's against tariffs isn't he? Just like Cohen was? Moore: He what? Jacobson: Isn't he against the tariffs? Moore: Well, that would...that's a problem, isn't it? And the President, he had effusive praise for Larry yesterday, but then he said "Well, we don't always agree on tariffs.", so that'll be an interesting development, assuming that Larry does get the job. You know, what I hope that Larry could do is, you know, push Trump in, you know, a more positive direction on this. I am one who, and I think Larry would sort of agree with me...yeah, get tough on China! I mean, it is time to get tough with China, they're cheating, they're stealing, a report came out just last week I think it was, maybe a week or two ago, that China is now stealing a half a BILLION dollars a year...I mean half TRILLION dollars a year, five hundred billion dollars a year, in our technologies, our computer software, our music, our...you know...our technologies, our patents, our copyrights, they just don't honor them! And, so we spend billions and billions of dollars to produce this stuff and China just steals it, and that can't stand! And maybe we do need tariffs to get tough with China (*Proft hums disbelievingly*), but you know, I think that Larry had a big impact on getting Trump to walk down...walk away from the tariffs on...you know, our allies, like Canada and the UK and Mexico, so we'll see, Dan and Amy. But this is an area where they disagree, but on most other things they are in full agreement. And, you know, I worked with the two of them during the campaign, and we didn't have a lot of agreements except for on trade. Proft: Well, look...the exemptions that are being much-ballyhooed by free marketeers, you know, they're "Oh look, he's just positioning, he's just leveraging, see look he's exempting Canada and Mexico, that's a good thing!" Well, okay, but this is also a lesson for proponents of tariffs generally because now the higher prices paid by US consumers for steel and aluminum go to three places; higher revenues for US Steel and aluminum producers, higher revenues for the US Treasury, because it's a tax, and higher revenues for the Canadian and Mexican producers of steel and aluminum, who also benefit from the higher price! Moore: Well, I mean...there is some truth to that, Dan. I mean, you got your economics right, so is this a perfect solution? *laughs* This is NOT a perfect solution, but I do think by the way Trump is going to announce sometime in the next few months a very tough tariff policy against China. I mean, China is a bad actor on the international scene right now, they facilitated the North Korean nuclear program, they not only facilitated it, they encouraged it and enabled it, they, I mean, as I said, they're stealing. I mean, why do we let that happen? I mean, what we produce more and more of in the United States is not steel and aluminum, we produce intellectual property, you know, the amazing things that are coming out of Silicon Valley and startup companies in Chicago that are developing, you know, intellectual property. And if that's what we produce and everyone is stealing it from us, then can we make money, how can we continue to thrive? So I find myself in favor of a very tough position with China, and some of the other bad actors on the planet, like Russia. But I don't...but...I'm worried. I have to tell you, full disclosure, I'm worried about what's going to happen with NAFTA, because Canada is not negotiating with Trump, and I know Trump, if he doesn't feel like there's progress being made, he's just gonna throw up his hands and say "Okay, we're outta here!" You know, you got Trudeau, who's the president of Canada, and he's a moron, an idiot! He's like a Bernie Sanders guy, and all he wants to talk about is climate change, and he doesn't want our states to have right-to-work laws, and things like that. So, you know, look...this is a turbulent time for trade, there's no question about it. Proft: But he looks better in traditional Indian garb than does Hillary... Moore: *laughing* Yeah! That was pretty funny. Proft: So let me...but no, Steve let me ask you this. If Kudlow does get the top economic advisor post, are you gonna backfill his radio show and compete with us? Moore: *laughs* You know, I just want to do...this is gonna be so cool. I mean, I think it is gonna happen, I think, you know, you've got a rock star in there now helping Trump on...you know, the free marketeer. I mean, what...you know the Kudlow Creed, right? It's, you know, "The best path path to prosperity is free-market capitalism.", and he is right about that. And you know, it'll just be...you know, he's an old Reagan guy, he helped do the Reagan tax cuts, he helped, he and I helped write the Trump tax cut, and I'm just really, you can tell I'm really excited about this because I think he's gonna be a real asset to the whole country. Jacobson: Yeah, have you spoken to him? I mean, he was the Best Man at your wedding but... Moore: I speak to him every day! He's my best buddy and you know, he's fighting for this and he's rested and ready to go so I think it's (Proft: Oh boy...it's like Nixon in '68.)...it's not official yet but listening to Trump yesterday it sounded like he'll...like it's 98%. Jacobson: Do you think he'll find out via Twitter whether or not he got the job? Moore: *laughs LOUDLY* Jacobson: I mean...that's what's happening... Moore: ...probably! I mean, that's how Tillerson found out, right? (Jacobson: Yeah! That was so cruel. "Thanks for stopping by!") Proft: Well, Kudlow is...Kudlow is a very encouraging pick, that would be a very encouraging sign. Moore: I'd like to say one more thing about this if I may...you know about this...you know, that...look, I'm on Fake News now, as you guys know, CNN...and their whole thing is "Crisis and chaos at the White House, it's all chaos!" And you know, the truth...look, you know Trump, Trump has people in his administration, and then you know if he doesn't like what you're doing, you're fired! I mean, that's his persona. And this is...you know, this is...chaos is not the right word to describe this, this is kind of creative discretion, right? This is what a businessman does! If he likes the job you're doing, you stay, if you don't...if you do...if you don't...if you... Jacobson: Well, when is it too much turnover? HR McMaster is probably next, John Kelly...there's talk this morning of moving the VA Secretary out and putting Rick Perry in there. I mean, don't you think that's a LITTLE ehh....that's a lot... Moore: Yeah. That's a lot of chaos, there's been a lot of turnover, no question about it. But I'm saying better to get the right people in there at the right time. Look, I actually think Gary Cohen, who was the NEC Director, was the right...I was opposed to him at first, but it turned out he was a good choice. He was a great manager, he got the whole office set up, he put some really good people in there, he helped get the tax cut through. Now, it's Larry's turn to sell the message to the American people about how well this economy is doing, and there's nobody better. You know, so I...look, the main thing is, the US economy is in an INCREDIBLE boom period right now, I mean you saw the Jobs Report last week. Unbelievable, 350K new jobs when you include the upward revisions, wages are rising. I would refer people to the piece that Larry Kudlow and I yesterday in the Wall Street Journal called "Who's Afraid of Higher Wages?" I mean, we're starting to see middle class Americans really benefit for the first time in 20 years from the economic policy in Washington, and isn't that what Trump promised? Proft: Okay, so the turnover is all Schumpeterian in nature, fine. Let's...I want to move on to something that Hillary said... Moore: (*reacting to Schumperterian*) Yeah, I like that! I'm gonna use that. Creative destruction, right? Proft: Yes, exactly. You can use that, just attribute me! So, one opportunity Larry has right away is to pick on something a colleague,of yours, Jason Willick, wrote in the Wall Street Journal yesterday. And this, I kind of missed this with Hillary's comments in India over the weekend. But he makes a great point, talking about how HIllary talking about winning voters that represent 2/3 of the GDP production in this country... Moore: Oh yes! I'm writing a piece about this, right now. Proft: That it is such an opportunity for the Republican Party to take the "Common Man" mantle, which no longer belongs to the Democrat Party, back permanently. Moore: I complete agree with you, it was such an arrogant thing to say, and you know...what does this hearken back to? Remember her famous statement in the campaign...the deplorables, right? The people who don't vote for me, and people who don't believe in the liberal cultural and economic agenda...are deplorable people who were xenophobes and homophobes and racist and so on. And she does...she keeps saying that she didn't really MEAN that, but she DID mean it, right? And that's the way liberals think about middle-class Americans, they think that...liberals believe that they're culturally and intellectually superior to working-class Americans. And you know what? They're NOT! And she was wrong factually! She kept saying "Oh, the dynamic places in the country voted for me!" and then she pointed to states like New York, Connecticut, and Illinois. You know, those states are LOSING all their jobs and their people! The dynamic places in America today are Texas, and Tennessee, and Florida, and Utah, and the mountain states, that's where the action is! And so she had a complete backasswards! And, I'm glad you brought that up, Dan, because I'm writing my latest column on this and saying wait a minute, the places that she won are the places that are losing jobs and losing people, and unfortunately, Illinois is one of them. Proft: He is Steve Moore, Wall Street Journal Columnist, look forward to that forthcoming piece, CNN Senior Economist, Heritage Foundation Economist. Steve, thanks for joining us as always, appreciate it. Moore: Okay, see you guys, take care, have a great week, bye!

Related Content

How Can Republicans Keep Control Of Congress?

How important is Trump’s protectionist stand on trade for Republican success in the Pennsylvania special election and holding the majorities in Congress in November? Could Larry Kudlow get into Trump’s head on tariffs and change his mind? President of Americans For Tax Reform, Grover Norquist joins Dan and Amy to discuss.

Related Content

Division In The GOP Over Tariffs

Are Trump’s proposed tariffs going to put speed bumps on economic growth? Is Jeff Sessions going to pay a visit to Chicago and address Tiny Dancer and Governor Rauner on their sanctuary state/city policies? Is the left going to cling to their anti gun agenda to win over voters in the upcoming elections? Representative from the 6th Congressional District, Peter Roskam joins Dan and Amy to discuss.

Related Content

Trump’s Misguided Commitment To American Business

Are trade wars good for the American consumer and are we currently losing? Is Trump serious about a tariff on steel and aluminum imports? Or is he just throwing out these tariffs as a negotiating tool? Are the tariffs protecting one industry at the expense of another? CNBC Contributor, Jim Iuorio joins Dan and Shaun to discuss.

Related Content

Is The Economy Overheating?

Could Trump’s import tariffs on steel and aluminum make the trade deficit worse? Do rising wages and more people working cause a rise in inflation? Are the people who say the economy is doing too well, the same people who claimed that a Trump presidency would destroy the economy? Is the majority of the country supporting the tax cuts now, despite the cries from the DC press corps and “crumbs” Pelosi? CNN Senior Economist, Steve Moore joins Dan and Amy to discuss.

Related Content

America Is Open For Business Again

Did Trump take a well-deserved victory lap in his State of The Union address? NAFTA may need to be renegotiated and modernized but is Trump looking to do away with the whole agreement? Were talks about the budget deficit sorely missed last night? Are those on the left rooting against Trump also rooting against America? CNN Senior Economist and columnist for the Wall Street Journal, Steve Moore recaps the State of the Union Address with Dan and Amy.

View full transcript


Proft: Good morning, Dan and Amy. Trump State of the Union Address yesterday, He made it clear, from his perspective, that the era of economic surrender in the United States is Oh-va! Trump (from tape): America has also finally turned a page on decades of unfair trade deals, that sacrificed our prosperity and shipped away our companies, our jobs, and our wealth. Our nation has lost its wealth, but we're getting it back so fast. The era of economic surrender is totally over. From now own, we *glitch* iting relationships to be fair, and very importantly, reciprocal. Proft: Alright, fair and reciprocal trade. Are those words music to the ears of one Steve Moore, Wall Street Journal Columnist, Heritage Foundation Economist, joins us now. Steve, economic surrender is over...did you like that part of the speech? Moore: Well, good morning. I liked a lot of the speech. I loved the "America is open for business again", and this idea that we are going to put America first, in terms of cutting taxes, cutting regulations, in terms of making sure that we're the number one economic superpower in the world. And look, he took a victory lap, well deserved, the economy is booming under his stewardship, so that was all good. But uh, you mentioned the one area that makes me nervous about Trump's policies, Dan...congratulations. Proft: Well I'm in the market for a new washing machine. So that's why I had to mention it. Moore: So look, I think when you think about what could disrupt this incredible boom that we're on right now, I think it IS trade protectionism, and so it does make me nervous. Does NAFTA need to be renegotiated and modernized? Yeah, I think it does, it could be improved, but I'm worried that Trump may try to get us out of NAFTA. I'm worried about, you know, his talk about tariffs against other countries in the world, which I don't think is very good policy. But, on balance I think that was a great speech, Trump is...one of my colleagues, Larry Kudlow, calls Trump "a one-man Chamber of Commerce for the United States". That was a speech...this speech, and his speech is Davos...both were appeals to people around the world, and businesspeople, and people with capital, to come to the United States, this is the place you want to invest in. And you know what? He's right. Jacobson: And President Trump touted the low unemployment rates, but also reminded us that we're going to have more take-home pay. If we don't see it in this paycheck, we're going to see it in the next paycheck. But the Washington Post this morning is saying what he didn't talk about, in what they call his "Reagan-ist speech", is that he didn't talk about the budget deficit. Moore: Sorry...about the budget deficit? Jacobson: Yeah, there was no mention of that whatsoever. Moore: *laughs* Well, you know, yeah...and I have to say this about Trump, and I kind of agree with them...you know, for the last 30 years the Republican Party has been obsessed about the budget deficit. And look you know, I've been for a fiscal analyst for the last...when I came to Washington in the early 80s, I was, you know, one of the budget experts in town, I know this stuff back and forwards. Would I like to see a balanced budget? Sure. Do I want budget control, do I want to see a shrinking of the government? Yes. But, I think what Trump has done is...the Republican Party is now a party of growth, it's a party of prosperity. We put prosperity ahead of balanced budgets, and let the Democratic Party be the party of austerity. You know, it was amazing to me last night, listening you know to some of the commentary, and you know, I did some of these post-elections debates, and the Democrats are still railing against the tax cut! I'm like "Really? Are you paying any attention to what's going on?" I mean, they're actually going to say the tax cut isn't working, when you've got 100 major companies, from Exxon to Disney to Apple, to FedEx, you know, announcing major bonuses for workers, and all this money coming back to the United States? So, look, I like the fact that he's a tax cutter, that he's trying to make America the most prosperous place in the world, and so far, so good. Proft: Yeah, so I mean, they're not just railing against the tax increase, or tax cut should I say, they're railing against employment! They're unhappy about low unemployment! Moore: They are! I mean, they're rooting against America. The Left is rooting against Trump and rooting against America and rooting against the American worker. They don't want Trump's policies to work, which is pretty pathetic, actually. It's pretty unpatriotic to say, "Gee, we hope we can score political points by..."...they'd love for the American economy to crash! They've been waiting the last 14 months for that happen, and of course it isn't happening. I'm predicting, guys, that we're gonna hit 4% growth this year. The reason that we only got 2.6% growth this quarter is...I agree with my buddy Art Laffer, what happened is a lot of businesses delayed their, you know, delayed their capital spending and a lot of their capital output until 2018, because that's when you get the tax cut, that's when you get the lower tax rate. We're gonna see a very, very strong first and second quarter this year, we're gonna have 4% growth, we haven't had that in 20 years! Proft: Right, but let me go back to something that you said. I agree with you in terms of market positioning...the Growth Party vs the Austerity Party, of sorts, even though I mean...Democrats and Austerity, they'll...the Democrats will spend money like termites go through wood. But, here's the thing...ultimately, you can't grow, or you're going to cap out, you're creating structural infirmities if you don't deal with things like a ballooning debt and unfunded liabilities. Moore: True. Proft: So...? Moore: So let me say this. This was my line to Trump and a lot of the Congressional Republicans, when I...and in fact I just talked to the Senate Republican Caucus yesterday and made this point...yes, we're concerned about that debt and the liabilities, Dan, you're exactly right. But, you're not going to make any progress on any of those problems unless you get the economy growing. You just can't get from here to there if you don't have 3 or 4% growth, I mean, I've looked at the numbers. You could slash everything, but if you don't get the economy growing, and people paying taxes, and businesses expanding...you know, when businesses are expanding and people are making more money...guess what? They're paying more taxes. So the first step in getting the debt under control, and these unfunded liabilities that you're talking about, is to get back to a strong economic growth pattern. We only grew at less than 2% under Obama, and now we're at 3 and if we get to 4, that makes this SO much easier to solve! Proft: Well that's true, but you have to introduce that into the conversation, so it becomes something that is discussed and debated and moved forward, so for example your...the plan that you've touted, we've talked about many times on this show, the Penny Plan. I mean, that can at least be part of the conversation so that at some point in the not to distant future, there's actually movement on it. Moore: I agree, and in fact...look, I agree with 90% of what Trump said last night. I am not in favor of getting rid of the Defense Sequester, and the sequester...the great budget control we've had over the last six or seven years was the Budget Control Act, which put caps on domestic and defense spending, and it actually has made a difference. I mean, government spending as a percentage of GDP is actually much lower today that it was during Barack Obama's first term, or actualy, George Bush's second term. So, you know, let's keep the caps in place, let's have some budget discipline! I love the idea...for those who don't know the Penny Plan, it's really is an amazing formula...you just cut every government program by one penny in 2018, and then cut it another penny...that is, a penny for every dollar they spend. So you reduce spending by one penny per dollar in 2018, and then again in 2019, 2020, 2021, and guess what? You've balanced the budget. It really is that easy! It just requires spending control. You don't even have to slash spending! You just have to make sure the rate of increase is cut in half. Jacobson: Well, that sounds like a brilliant idea! Proft: Well there you go! That's why Steve Moore's proposing it, yes! Jacobson: So, President Trump yesterday had a number of people he featured that were heroes, but he also featured business owners, and I thought that maybe you took that to heart. Steve Staub, and Sandy Keplinger, who say they've seen a bump in their business this year. Did you like that? Moore: You know what? I loved that aspect of the speech. I think everyone agrees that the fact he had these amazing American heroes and he called them out, and it really punctuated every point he wanted to make. And I thought another great moment was when he called out that gentleman from North Korea, I don't know if you remember that moment. Proft: Ohhh...that was the best moment EVER! Moore: Yeah, it was awesome! And he basically said "Look, this is what North Korea is about! These people are tyrants, they're our enemies, they are killers, and they're killing their own people!" And anybody can...I don't believe they Left...they seem to want to appease Kim il-Jong (sic), rather than...we've gotta take their weapons away from them, it's the most dangerous thing in the world. So I love the fact that he did that, it was such an effective device to make his point, to show...you know, whether it's a businessman, or a victim of Communism or so on, I think he's almost changed the way that State of the Union speeches will be given in the future. Proft: He is Steve Moore, Wall Street Journal Columnist, CNN Senior Economist, Heritage Foundation Economist, Steve thanks as always for joining us, appreciate it. Moore: Okay guys, have a great week, take care!

Related Content

Trump Outflanks Democrats On Fairness In Immigration Plan

Is Trump's immigration proposal what Nancy "Crumbs" Pelosi claims, an effort to "make America white again"? Should we start creating a path for Pelosi’s retirement? Is the immigration plan put forth by Trump a win/win politically? If money doesn’t matter to Jay Z in response to the reduction in black unemployment under Trump, what “helpful” things has he said or done throughout his career to help women or minority communities move forward? The "First Ladies of Punditry," Diamond and Silk join Dan and Amy to discuss.

Related Content

Shortage Of Workers Not Jobs?

Are Trump’s protectionist trade measures going to disrupt the booming American economy? Why is Trump thinking about increasing tariffs and what does that portend for the future of NAFTA? If California is thinking of turning their state fund into a charity, does that then make paying income taxes optional? Did the government shutdown distract the media from reporting the new record low of the number of people signing up for unemployment insurance plans? Wall Street Journal columnist and CNN Senior Economist, Steve Moore joins Dan and Amy to discuss.

Related Content

Elitist Nancy Pelosi Calls Tax Cuts And Bonuses Crumbs

Is Trump derangement syndrome leading leftist politicians and the media to actively root against America? Politicians become more powerful the bigger government gets, why then would Democrats advocate for sensible work requirements for government aid? CNN Senior economist, Steve Moore joins Dan and Amy to discuss the possibility of linking immigration and welfare reform.

View full transcript


Proft: Yeah...you enjoying your crumbs, you SERFS? That's what the House Minority Leader, and one of the richest members of Congress, had to say about the Trump tax cuts and these big bonuses that have been publicized at big companies, Comcast and others, as well as the savings that 80% of Americans are likely to see as the result of the Trump tax cuts. Mere crumbs, says Nancy Pelosi. Reporter (from tape): A number of companies are attributing the Trump tax cuts for being able to give higher wages to their employees, as well as being able to give bonuses to their employees. How do you respond to that? Pelosi (from tape): Well, the number of bonuses that were given...one of the bonuses given was already in a Union contract, and then they added *tape cuts momentarily* onto that. That same firm just told their employees that they were going to be laying off 1500 people, and if they wanted to save their jobs, they could all start working three to two hours in those communities. So, in terms of the bonus that corporate America received, versus the kind of crumbs they are giving out to kind of put the schmooze on, is so pathetic. Proft: *sarcastically* Yeah. That's just a schmooze they're putting on, that extra money in your pockets, just to schmooze. This is the attitude of the Left, because anything that devolves power away from government, and them by extension, and resources away from them which is the source of their power in part, they're not going to be on board for. And it's very interesting, the attitude they have towards corporate America and towards people who like places like Walmart. Jacobson: But aren't they "Corporate America"? I mean, their spouses have jobs in "Corporate America". Nancy Pelosi is bitter because they're going to be hit harder by this tax plan. Proft: They're exempt. Think about Walmart and McDonalds...make fun of the President. Chris Arnot, he's this...he's a photojournalist, who's traveled the country to document and talk to Trump voters, he focuses on areas like poverty and addiction, across the fruited plains. He sat down for an interview at the American Enterprise Institute, and he talked about the McDonalds Test, when it comes to advocates for the downtrodden who have no understanding, or frankly concern, about the lives that the downtrodden are living because it's really about them feeling good about themselves. It's not about helping anyone or appreciating their lives. Arnot (from tape): I guess what I've always said is, the thing I've learned about this in the last six years is...in aggregate, not specific there are different examples, but in aggregate, the people who are advocating for the poor the most often don't understand them on a visceral level, they don't understand the people they're advocating for, they don't understand their lifestyle, they don't understand the way they live, they don't understand. So I always use a McDonalds Test. A lot of people who advocate for the poor hate McDonalds, but McDonalds is essential, and when you're poor, McDonalds is ESSENTIAL. It's cheap food, it's GOOD cheap food, and it's also a community center, where people go to meet other friends and basically get free Wi-Fi, it's what...it's a place that people go to find community. Walmarts are the same way. When I want to find an immigrant...when I go into a new community and I want to see where the immigrants are, they're in the Walmarts. And yet, you know..a lot of people who advocate for the poor make fun of Walmart, they make fun of McDonalds. Proft: Yeah, they make fun of 'em. Walmart employees a million people. You know what Walmart's profit margin is? Jacobson: No, what is it? Proft: It's a very interesting piece about what people think companies' profit margins are vs what they actually are. You know that Walmart is a volume business, and remember the vision of Sam Walton was to make everyday goods more accessible for the poor, starting in Arkansas. Walmart's profit margin? 2.1%. 2.1%. So when you start artificially inflating the cost of doing business for high-volume, low-margin businesses, you start seeing people laid off, you start adding to the ranks of the poor, you start seeing people shut their doors. And that's what Nancy Pelosi and the Left doesn't want to concern themselves with. And it's disgraceful because Nancy Pelosi's position is couched in compassion, and that she's a champion for families working their way up the rungs, and she's just the opposite. Arnot probably wouldn't take my position the way I take it, but he's essentially saying the same thing; they have no understanding, and I'll add, they have no concern. These people...other human beings are MASCOTS to the Nancy Pelosi's of the world, they're the means to their political power ends. And that's their only utility for the Left. And we should speak with moral clarity on the subject in the political arena if we want to advance the flag and discard this caricature that's been created of people who believe in free minds and free markets. Like me and our next guest. Our friend Steve Moore, Chief Economist at the Heritage Foundation, Steve thanks for joining us, appreciate it. Moore: Hi guys, good morning. Enjoying my crumbs, I don't know about you guys. Proft: Yeah, yeah what about that, and the companies that publicize the bonuses they give per the tax cuts, they're just schmoozing? Moore: You know, I've listened to your conversation, and I'm writing my column on this right now as we speak, about one of the things that is happening in America is because of the anti-Trump derangement syndrome of the Left, they're now rooting against America. They want Trump to fail, they want the tax cut to fail, they don't want bonuses to low-income people, because that might mean if working-class people get bonuses and their lives are improved, they might actually SUPPORT Donald Trump! I've never seen anything like it, but I really truly believe, and I wonder what you guys think, I now truly believe the Left is rooting against America and American workers, they don't want the pay raises, they don't want the jobs, they don't want the improvement in our economy, the improvement in the stock market, because that makes Trump look good! Jacobson: Well when are we gonna start seeing a little more bump in our paychecks? Because President Trump said in February...is there a possibility it could be sooner? I just want a $17 difference in mine. Moore: You know, Amy...yeah, there was some discussion at the Treasury Department the other day on whether the IRS would be ready to change these withholding tables by...well I guess February's just a couple of weeks away now. It's coming soon, I don't know if they'll be ready by February, but certainly by March, and then people start to feel the additional pay that they get. Now, you know, for a lot of workers, that might be $30 or $40 additional dollars in their paycheck each couple of weeks. Now the Left will say "Oh gee, all you can buy with that is...a t-shirt," or something like that, or Pelosi will call it crumbs. But you're talking about, for the average worker with an income of $60K, they're gonna have about another 1500 or 2000 dollars a year in their paycheck, and that's a lot! It's not a lot to Nancy Pelosi, who has pools and jacuzzis and tennis courts and eight acres in northern California, but for the average person, an extra 1500 to 2000 dollars means that they can purchase health care, they can pay the tuition for their kids schools, they might be able to take a vacation. Those kind of things for an elitist like Nancy Pelosi, they're hard to imagine...it's hard for her to imagine why an extra $1500 really matters. Proft: The Work Requirement Option that Trump is giving state Medicaid directors...Bevin in Kentucky adopted it posthaste, excited about it, put out all sorts of messaging on it. Less excitement here in Illinois, as usual for anything that makes sense. (Moore: Yep!) But it seems to me that this is the lever for a larger national discussion on Welfare reform, particularly as part of a deal to provide permanent status to 800K DACA recipients. And good piece in the Wall Street Journal by Christina Rasmussen from the Foundation for Government Accountability (Moore: Yes! I saw her piece.), yeah, about no asset limits in 30 states to receive food benefits. So, is this a moment where immigration comes together with welfare state reform and Paul Ryan really leads this charge. Moore: I love that idea, by the way, of linking welfare reform and immigration reform. I'm all for immigration, I'm all for people who want to come here and work, but I think one of the requirements of an immigrant coming into this country, and I made this case about the people being talked about to be legalized who were here illegally, is no welfare. And one of the requirements of the people they may legalize under this new DACA requirement is "If you've been on welfare, no, you don't get to stay here!" And that's not being cruel, that's been our policy for 100 years with respect to immigration. The immigrants who came in through Ellis Island, my grandparents, if you came in and you were seen to be a public charge, you would be deported from this country! Now I know you probably think it's cold-hearted to say that people who have received Medicaid or Food Stamps should have to work to receive those benefits, but I think it's a very sensible policy, I think a lot of people on these programs are able-bodied. They're talking about able-bodied people who don't have kids, you know 24-year olds are sitting at home watching TV rather than getting a job. (Proft: Yeah.) Yeah, you know, it works by the way. Work requirements WORK! They worked under Bill Clinton, for goodness sakes, when we passed welfare reform, we reduced the welfare caseloads by 50% by getting people into jobs. But the Left, look, they don't want to do this because under, remember, under Obama, Dan, they wanted to sign as many people up for welfare as possible! They just...they saw it as a victory. The more people on welfare, the more people on food stamps, the more people on Medicaid, the more people in public housing SSDI, the better...the better it was for the economy, remember? They thought food stamps was a stimulus! Jacobson: Well, they're still doing that. I get robo calls all the time, because my kids are Hispanic and in CPS for Link cards, I also get robo calls for Medicaid, where I can go to sign up for it. So they're still promoting this... Moore: Yeah, they advertise it! You know, cmon! And the other thing, Amy, they try to do, and if liberals were still in charge they'd still be doing this, is saying "Look, there's no shame in getting welfare, you know! You help your local community!" Remember that? (Proft: Sure.) "You help your local community when you sign up for food stamps." (Proft: "Unemployment benefits are stimulus!") You know, we have 46 million people on those programs today! It's so outrageous, and I think it's a winning issue with the American people. We do believe in giving people a hand up, if they fall down, but not a hand out. That's what we've done with our welfare program, and by the way, Dan and Amy, you guys are right, you can literally take your PORSCHE and drive it up to the Welfare office and sign up for food stamps! Proft: Right, because it's about income, not assets. (Moore: Yeah!). Well how about, we're...since the Left is so...always so excited to adopt what's happening in Western Europe, how about this in Switzerland? Asylum seekers and migrants who have received welfare over the past three years will no longer be granted citizenship in Switzerland unless they pay the state back. Jacobson: Ohhh. Moore: Where's this? Proft: Switzerland. Moore: *sounding surprised* Well...well look, I'm in agreement with that. You go on welfare, you should not be granted legalization or citizenship. I mean, we can't afford to be bringing people into this country who are gonna go and...by the way, this is the first thing the Left does when immigrants come into this country. It used to be you got them integrated into the community, we got them into jobs, and they pulled themselves up by their bootstraps and made a better life for themselves. First thing that happens when immigrants come into a state like California, or unfortunately, Illinois...they sign 'em up for food stamps! Proft: Yeah well, dependency makes the government bigger and the politicians power larger, and that's the play. Steve Moore, chief economist at the Heritage Foundation, CNN economist and Wall Street Journal columnist of course, Steve, thanks for joining us. Jacobson: And Steve, you did a great job on CNN! Moore: Thanks guys, I'm gonna go have...I'm gonna go have my crumbs for breakfast. Proft: There you go! Jacobson: And he did a great job on CNN yesterday, he was in the hot seat and he handled himself very well, AND he joined us on our Turnkey Dot Pro Answer Line!

Related Content

Black Unemployment Rate At Record Low

Black unemployment is at its lowest rate since the Bureau of Labor Statistics began tracking it. 196K more manufacturing jobs were also added in 2017 along with 16K fewer federal government jobs. Maybe it doesn't take a genius to be a POTUS, just restraint? What are the most advantageous reforms the Trump administration should tackle next, immigration, entitlement reform or an infrastructure project? CNBC Contributor and columnist for the American Enterprise Institute, Jim Pethokoukis joins Dan and Amy to discuss.

View full transcript


Proft: Good morning, Dan and Amy. So I don't put a lot of stock in the Bureau of Labor statistics, the Unemployment rate, their measuring of it. It's certainly not the straight unemployment rate, more interested in the U6 rate, which includes those that are... Jacobson: They call it the REAL Unemployment rate? Proft: Yeah, those that are underemployed, right? Jacobson: And those that have just stopped looking, too. Proft: But at least you can do an apples-to-apples comparison. And the Left was quick to tout a declining unemployment rate during Obama's years, so you can't blame President Trump for doing the same. And particularly this number, we discussed this with Scott Shellady with the December Jobs report on Friday, but we didn't get to this number, as more breakdown was done by economists...this was our friend Mark Perry over at American Enterprise Institute, whose "Carpe Diem" section at AEI, his "Carpe Diem" blog is always excellent, that's a must read for me. And he notes that lowest black unemployment...the lowest...the gap between white unemployment and black unemployment, 3.1%...that is the lowest gap since the Bureau of Labor Statistics started tracking the black unemployment rate back in January of 1972. And so this is something that should be roundly celebrated, that that gap is declining and the overall rates are declining, right? That's good news. Also, and correspondingly, 196K manufacturing jobs created in 2017, and 16K fewer Federal government jobs. That's small, but still a little bit of shrinkage at the Federal level, and expansion of the manufacturing sector. It's the latter... Jacobson: Too bad we can't do that in Illinois! Proft: Well right! Jacobson: Expand manufacturing and reduce government jobs. Proft: Exactly! Jacobson: Well see, that's the number one employer of Illinois, right? Proft: Well...agribusiness, but it's certainly associated, yeah, with John Deere and Caterpillar, so...exactly right! I mean, imagine that...expanding the wealth-producing sector and constricting...contracting...the wealth redistribution sector! What a concept! In Illinois, by contrast...I made this mention before but I don't think I can say it enough...the greatest disparity between government jobs and manufacturing jobs anywhere in the Midwest. You want to know why Illinois' manufacturing renaissance isn't occurring as it is in our neighboring states? Illinois, 175K more government jobs, at every level, than manufacturing jobs. Alright? Federal government, Federal level, 186 new manufacturing jobs, 186K, 16K fewer Federal government jobs. Who’s going in the right direction? For more on these and other topics, we're pleased to be joined by our friend Jim Pethokoukis, CNBC contributor, columnist for the aforesaid American Enterprise Institute. Jim, thanks for joining us, appreciate it. Pethokoukis: Hey, thanks for having me on, guys. Proft: So what about this Jobs report on Friday, and kind of the numbers within the numbers that I just mentioned? Pethokoukis: Well listen, we've had a very long economic recovery. It has not been particularly vigorous, but it has been steady, as month after month we've been sort of chopping down at the unemployment rate, other...you talk about those internal numbers like labor force participation, those have served...those have strengthened. So the prime age workers, 25-54, that's strengthened. That's enough that you have a very long recovery, again not very robust, though we're adding lots of jobs every month, so we're...listen, I have a little more...I think the unemployment rate is a meaningful number, I think it's a good number. And listen, some of these Wall Street banks, they're thinking we may have an unemployment rate closer to 3%, you know, over the next 18 months. And we haven't seen that since the 1950s. So right now, slow but steady. Jacobson: So what is the reason behind the African-American unemployment rate dropping to record lows? Is it because more African-Americans have college degrees? Pethokoukis: We've had a very long recovery, so ALL these unemployment rates are dropping. Why that GAP has narrowed specifically? Well, one thing I can tell you is that certainly we've seen better wage gains and strong job gains through the lower half of the term "job spectrum", and on the top, not so much in the middle, so that's going to affect different groups differently. But listen, in another year and a half, two years of this kind of job market, not only would I expect wages to go up faster, but I expect that gap to shrink further. Proft: There's some suggestion that the tax cuts may push off the national business cycle, and the downturn that is coming, because as you said, we've had this long steady...not vigorous...but long and steady recovery from the depths of the Great Recession, and that if the tax cuts push off the downturn, the market correction, say past the 2018 election, then you've got a president whose going into his election, or re-election year potentially, in recession. Do you kind of see the same timeline in terms of market correction, natural business cycle, that at some point this recovery is going to stall and we're going to see two quarters of negative growth? Pethokoukis: Listen, recoveries...expansions usually don't just end because they've gotten too old, okay? Usually it's something happens, that something is the Federal Reserve trying to tamp down inflation pressures, and ends up raising interest rates too fast, and we get a recession. This is probably a pretty (?) Federal reserve, they're probably going to take their time with this new sort of fiscal stimulus that we have from the tax cuts. So listen, I don't know the timing, nor would I say a low unemployment rate necessarily guarantees anybody's re-election...I think if I was running for President, and I was the incumbent, I'd rather, you know, have a very low unemployment rate than a very high unemployment rate! But you know, if you look at the 2000 election, we'd just had a boom period, but yet the Democrats did not win that election. So there's...it's no guarantee. Proft: And, with respect to...just thinking about economic growth. So the next step you would take? There's discussion with what's on the Republicans...the Congressional Republicans agenda, and the President's agenda this year. Is it going to be something on the spend side, entitlement reform, which of course is Paul Ryan's bailiwick, or is it going to be a big infrastructure project that President Trump wants to do, some kind of public-private partnership, as politicians are wont to say, these big public works programs, or is it something else that they should be doing to forestall that recession that some are concerned about? Pethokoukis: Yeah...I'm very skeptical about getting entitlement reform, because I think Paul Ryan is the only person in Washington now who cares deeply about that issue, I'm not sure anybody else does. I'm very skeptical about the infrastructure piece as well, I mean there really isn't even a plan put together yet, and now we're moving into 2018, a midterm year, I just don't think...nothing really big is going to happen. Listen, I think that at least for the moment, Washington should be in the "Let's not screw anything up" stage. I think there's a lot of stuff happening in the tech sector that will begin filtering into the rest of the economy, which should boost productivity. Now, I hope that happens, and I would hate to start screwing that up, either by doing something...another big spending plan that could enormously raise the deficit. Even as is, we're probably going back to trillion-dollar deficits, I remember when people used to care about that, apparently they don't care about that anymore. Right? We should take a breath and just think about what we need to do about some of these longer-term issues. Particularly education, which is an issue that excites NOBODY, but it's probably the most important one for our long-term growth. Jacobson: Well I think on the top his agenda, President Trump, is you know, building the border wall, and tying that to DACA...but where are we going to get $18B dollars? Pethokoukis: I dunno...the same place that we're getting $1.5T dollars. Charge it! Proft: Hahaha, yeah, charge it. That's pocket change! Just run my AmEx on that. What about the Energy sector? Kind of an underappreciated event last week, because of all the furor of the Michael Wolff book, was the Trump administration given the green light to drilling rights off both Eastern and Western seaboards. And the energy sector was, you know, one of the most robust sectors that probably deserves a lot of credit for that expansion, however kind of slow and steady it was, and Trump seems to be doubling down on energy independence. Pethokoukis: Well it's sort of...I think it's amazing that it's still kind of an under-reported story about what's happened. I mean, there's been two massive technological innovations in the 2000s; one has been the Internet, and the advent of smartphones, having a supercomputer in your pocket. And the other has kind of been the Shale Revolution. One...I certainly read a lot more about the one, on the front page of the business sections than the other, but both have been tremendously important, and will continue to drive growth going forward. Proft: Alright, he is Jim Pethokoukis, CNBC contributor, columnist for the American Enterprise Institute, and a stable genius in his own right, he did...his is a Jeopardy champion as well. Jacobson: Oh yeah! That's right. Pethokoukis: Half of that description is true! Not saying which. Proft: ...stable? It can't be stable. Pethokoukis: No, listen...I report, you decide. Hey sports fans, stay warm! Proft: *laughing* Thanks Jim, appreciate it.

Related Content

Trump's Approval Rating Same As Obama's After 1st Year

Has Trump succeeded in the hardest task of turning around the sentiment of CEOs? How will cryptocurrency affect the markets? How much longer until government gets involved? Does the current success of the markets have anything to do with the previous administration’s lack of experience in the private sector, unlike the current one? Is the market on stable footing yet? Fox Business Contributor, Scott Shellady joins Dan and Amy to discuss.

View full transcript


Proft: Good morning, Dan and Amy. And jobs numbers for December out. The projection...or the data collection by ADP and Moody's, had a big number, 250,000 jobs for December, meaning 2.54 million new jobs in the year 2017. The Labor Department's numbers a bit lower, 148,000 jobs added in December, bringing the total number of new jobs created in President Trump's first year to a fairly robust 2.1 million jobs, in addition to the nice 3%+ GDP growth. Again, something we saw for three straight quarters, and we didn't see for 8 years under President Obama. Jacobson: Yep, and the unemployment rate stayed the same at 4.1%. Proft: For more on the numbers, and the meaning, and Dow 25,000... Jacobson: Woo, yeah! Let's not bury the lead, Dan! Proft: Well, that's PART of the lead. I dunno, look...Scott "The Cow Guy", Scott Shellady...he's a bit of a cynic. Jacobson: Y'think? Proft: He's not...not a rosy optimist, he's been warning us about this "economy on a sugar high" for many moons, I wonder if he's changing his tune. I wonder if he has... Jacobson: ...swinging from chandeliers this morning? Proft: Well, I wonder if he's liquidated all his assets and put them in Bitcoin. Jacobson: Ohhhh... Proft: For more on all these topics, we're pleased to be joined now by "Scott the Cow Guy", Scott Shellady, Fox Business News Contributor, Hi Scott! Shellady: Good morning. Yes, good morning. Jacobson: So, are you happy this morning? Proft: Umm...well I don't know, there's lots to talk about. There's such a mish-mash. I mean, there's a few other extenuating circumstances out there. I'd like to add to the fact that we've seen...I mean, you probably have it on the tips of your tongues, but the Dow year over year last year was up 25%. Proft: Right. Shellady: And the NASDAQ was up 28%. I mean, those are HUGE numbers. But we just had some information come across our desk that said that in the last 5 years, so 2012 to 2017, individual retail investors pulled one trillion dollars out of the market. So, this rally really hasn't been participated like everyone thinks it has been, and a lot of the money that's been put in has been institutional, and/or stock buybacks and stuff like that. So, maybe when we start to see the retail investor get back in, that's when you should really get out. Because usually that's how this thing all works out. Proft: Well, elaborate on that. Especially with the tax cuts getting and the prospect by some of our more optimistic supply-side friends like our friend Steve Moore, 4% GDP growth this year. Shellady: Well, you know...I've been doing it 30 years, guys, and I think that one significant thing that's different with Donald Trump this time around, the presidents we've had in the near past, is that he's...one of the most difficult things to turn around is sentiment. You can start to turn some of these economic indicators around with policy like tax cuts and the like...but at the end of the day, we're finally starting to see the sentiment morph into CEO's buying property, opening up their pockets, you know, spending money on equipment and the like, and that is the hardest thing to get done. See, psychological problems in the financial world are so scared, right? Nobody wants to talk about a recession, or deflation, because a lot of those deflationary issues are psychological, right? Nobody's spending money even though things are okay. There's a ton of books written on how to combat inflation, because that's not a problem that's really a psychological issue, that's more the financials. So Trump has done a great job psychologically turning around the country's psyche, and then that has been, I think, a really large part of this rally in stocks. Jacobson: How do you think Bitcoin, and all that stuff that Dan is dabbling in... Proft: Cryptocurrency. Jacobson: Cryptocurrency!...is going to affect the Stock Market? Shellady: I think it's way too early to get involved with those things, and I mean, our business is regulated...OVER-regulated, just like everybody else's, and I've had to take so many tests and exams and refresher courses over the last twenty years, and one of the first things they always want to warn us about is money laundering, right? "Does this customer really have the money, or is it coming from Russia?" So I think that Bitcoin and the likes, all the other coins that are out there, are going to be ripe...rife...with people laundering money. And I still think there's no way you're not going to have the government get involved where there's that type of thing easily going on. So way too early to tell if thing's really going to...I mean I love the BlockChain technology, and it's going to have some great applications. But as far as these Bitcoins and cryptocurrencies, it's too early to tell. The best way to say it is now we're in the Pioneer stage...and my definition of pioneer is "a guy with a coonskin cap, facedown in a puddle of muddy water with an arrow in his back", okay? That's where we're at with Bitcoin right now. Proft: *laughing* That's vivid! Thank you for that! Now, Paul Manafort did ask me to hold some of his assets, and deploy them, so that's why I've gotten into cryptocurrency, so I'm just saying. But go back to what you were saying before, particularly about your business being over-regulated. It seems to me, one of the under-reported stories...and we've tried to over-report it here to make up the difference...is the deregulation that's occurred in Trump's first year, or just the restraining the government from continuing to pile on new regulations, Trump famously said towards the end of the year "22 regulations repealed for every new regulation". And so you started to see the sentiment turn around and that GDP growth spike up well before any taxes were cut. Shellady: Yeah, and then that goes back to my point. He's been able to turn sentiment around just by doing a few things like regulation. That's gonna make the CEO feel like "Hey! We've got a business-minded guy in office for the first time in a while!" I mean, take a look at the people that were in office under the last administration, see how many of them ever really worked in the private sector. I mean, it's shocking to find out how many of them NEVER worked in the private sector. So, I also saw something that was...you probably..I don't know if you reported on this Dan, but Rasmussen came out with a poll at the end of the year...only last week...that said that Obama and Trump, they had almost identical approval ratings at the end of their first years. And I think, you know, Obama started real high and then slid down, and I think that Trump has rallied a little bit. But it's interesting to see that...at the end of the day, love him or hate him, and you know, he's easy to hate, I get it...but when you have a Stock Market that rallies 25% in one year, and the sentiment has done such a big turnaround, it's hard not to be excited about the future if you're a CEO in America. Proft: But do you still have the concerns that you've expressed on this show before...I mean, this was still during the campaign so still during President Obama's tenure mostly, but about, you know, the Feds tinkering with the money supply, and quantitative easing, and this kind of sugar high that the market was on, the economy was on? Or do you think that as the Fed has receded in terms of its tinkering, and you see the deregulation and now tax relief, that we're kind of getting past that, and we're on more stable footing. Shellady: No, I don't think we're on more stable footing. Not at all. I mean, we're now running up against a record of the longest amount of trading days without a 5% pullback, and the record was set in 1929. So, we have a Stock Market that has benefitted from stock buybacks and I mean, we haven't...the mergers and acquisitions...we haven't seen...even the 4.1% unemployment, Dan and Amy...how can we have 4.1% unemployment, which is almost a full percentage point below what...economists used to say that 5% was "full employment"...and look at the wage growth...the wage growth numbers come out today. I mean, they're tepid. They're not going DOWN, but they're really...if we really have a 4.1% unemployment rate, we should be ripping the faces off each other trying to employ people with higher wages! It's just not happening. So something's broken. And that's the problem that we can't figure out, and the Fed doesn't know the answer, or they obviously would have done it already, number one, and number two is they've ALWAYS been wrong, they've been consistently wrong. So look, I don't even know how you can say, in this environment, you have to raise rates, except for the fact those are people like the Jimmy Ayerero's (?), a good friend of mine, of the world that want to see some quote-unquote "normalization", and normalization is getting interest rates back up to a healthier level. But look, in 30 years of doing this job, you only ever raise interest rates in order to get out in front of an overheated economy or an economy that's about to overheat. And can anybody tell me if our economy's close to overheating, though? No! So we've got problems, and the Fed's at the charts...they're at the helm, and they don't know what to do. NOBODY knows what to do, and that's the problem. Proft: Alright, you used up your two violent metaphors. You got your ripping faces off each other, and you got your Davy Crockett face down in a puddle with an arrow in his back. So that's all we allot to any guest, Scott. Shellady: *laughing* Alright. Proft: Scott Shellady, "Scott the Cow Guy" Fox Business Contributor, Scott thanks so much for joining us, appreciate it. Shellady: Alright, thank you.

Related Content

Paying More Taxes Because.... Charity!

Are the Trump tax cuts just a thinly veiled ruse to prop up the patriarchy, as Susan Faludi suggests? Or is this just the typical hysterics from the left? Do the lines outside Cook and Dupage counties’ assessor's’ offices disprove the liberal philosophy that taxes “don’t matter or affect people’s behaviors?” Can we make property taxes a charitable donation to the government in Illinois? Does Medicaid give states an incentive to waste money? Wall Street Journal Columnist, Senior Economist for CNN, and former Donald Trump advisor, Steve Moore joins Dan and Amy to discuss.

View full transcript


Proft: Dan and Amy, good morning. And Amy, we had the chance to have a little holiday lunch with Steve Moore...just before Christmas. Jacobson: Yeah, we sure did! Proft: That was nice. Jacobson: Well it took me a little longer to get there, I was supposed to be on time because I'm a punctual person but I had the wrong address emailed to me by Stephen Moore! I'm sure it was just an oversight. Proft: Yeah. Jacobson: So I got there when you guys had had your food delivered, but it was a nice event. Proft: It was, it was too...*Jacobson chuckles* no, what? It was to celebrate the passage of tax cuts, and what Steve Moore and other supply-side economist types think will be the result, which will be a strong economy in 2018, 4% GDP growth, and economic opportunities and job creation associated with that kind of growth. For more on the topic, and an opportunity to apologize publicly to you, Amy, we're pleased to be joined by Heritage Foundation economist Steve Moore. Steve, thanks for being with us, appreciate it. Moore: *laughing* Good morning, guys, Happy New Year. You know, one thing I learned from that lunch...you guys have faces for TV, not radio! You guys are just a good looking couple! Proft: Well, thank you so much, thank you very much. Jacobson: Well, you know, I really meant Amy... Proft: Ahh, well... Jacobson: Yeah, Dan! He just didn't want to discriminate against you. Moore: Yeah but thank you, it really meant a lot to me that you guys came... Proft: Yeah, it was great. Moore: And Amy, sorry that I sent you to the wrong place, my bad. I owe you a lunch. Proft: Yeah. Moore: Yeah but look you know, 2018 is off to a great start. We're pushing on with Dow 25,000, something that no one expected or thought was possible...got into an online argument with a bunch of these liberal economists who now say "Well, this is the Obama economy, it's not the Trump economy! It's Obama who drove the economy up to 25,000 on the Dow, and up to 3% GDP growth." That's kind of nonsensical because everything we've been doing under Trump has been basically been throwing Obama's policies into reverse. Proft: Yeah...that doesn't mean that the Left is not still advancing their case. And I'm going to give you an opportunity to restore your good name in the female community, Steve Moore, by agreeing with feminist Susan Faludi, who wrote about, over the holidays in the New York Times... Moore: Now, who is this again? Proft: Susan Faludi, Susan Faludi of...ya know...great feminists like Gloria Steinem and Naomi Wolf and others like that. Moore: Oh, okay. Got it. Proft: She suggests that what you and your friends did in DC, Steve, was to reinforce the patriarchy that oppresses women... Jacobson: *shaking head* It has NOTHING to do with gender...wow. Proft: ...that's what this plan does... Moore: How's that? Proft: Let me give you an example. "The Tax Cuts and Job Act systematically guts benefits that support women who need support the most. It means an end to the Personal and Dependent exemptions, a disaster for minimum wage workers, nearly 2/3 of whom are women," Steve. Moore: Well...no, I think she's confused about the numbers. So we basically dramatically increased the standard deduction, so let's say that you're a single, and you have no kids and you're not married. Your standard deduction goes up to about $12,000 from a little over $6,000 last year. And let's say you're a single woman with kids, 2-3 kids and you're a single mother. Not only do you get a $24,000 standard deduction, but you would also get $1,000 increase credit, which is refundable, against your payroll tax...per child! Per child. You know, if you're a single mother with two kids, you get an extra $2,000 right off the top! So, I don't really understand her math. Proft: Her math is WRONG, but I just want to advance the argument. Jacobson: "Math is hard..." Proft: No, but it...it...point of fact, minimum wage earners end up AHEAD in this because of what you just explained. But these are the arguments that are being put out, and oh by the way we were just having this discussion before you joined us, but GOP... Moore: My...my only question is, when someone writes something like that...are they just lying? Or are they ignorant of the bill? And don't they have fact checkers at the New York Times? Proft: Yeah, and...although, lying and being ignorant, not mutually exclusive...but here's the thing. 62-30, we've got a 32-point deficit, Republicans do, among college-educated women, and 20-point deficit generally. And this is gonna... Moore: Among women? Proft: Yeah, among women. Moore: Yeah. Proft: And this is something that's going to have to be addressed. Moore: It's a big problem! It is a BIG problem. When I walk down the street, I often get frowns from upscale women, who feel like Trump is some kind of demon. But you look...my feeling is about Donald Trump is pretty simple...don't look at what he says, don't pay attention to his tweets, just always pay attention to what he's doing. Take a look at the actions he's taking and the impact they're having on the economy and they're universally positive! I mean look, I don't like a lot of his tweets, I think sometimes he acts more. Yes, he exaggerates, "I WILL BE THE GREATEST PRESIDENT IN THE HISTORY OF THIS COUNTRY!" kind of thing. But you look at what he's done to rebuild the economy, rebuild the stock market, confidence is up everywhere I go, I talk to business men and women, they say "we're feeling good about 2018", so just ride...ride on this rising tide! Jacobson: But the sad thing is we live in this state where our Federal taxpayers...we're gonna have a cap on state and local tax deductions at $10,000, so...you should have SEEN the lines in DuPage County, Will County Treasurer's Office, Cook County...Cook County, normally $13 million prepaid, this year, it was $529 MILLION. That's what the total was, before the stroke of midnight. Moore: WOW. So you know what I find interesting about that...I'm glad you brought that up, Amy, because I just wrote my column this week on this whole (?), because the whole kind of...the liberal's philosophy on taxes is taxes don't really matter, right? They don't really affect people's behavior, they don't change their behavior based on a change in tax policy. Well, of course that's visibly wrong now! People are waiting in lines for hours and hours to prepay their property taxes, so they can shave a little bit off of what they're going to have to pay. Yes, taxes DO matter, they DO affect behavior. And people say "Well gee, if taxes will affect the behavior of people to prepay, why wouldn't lowering taxes on people when they work, when they start a business, when they save, why...when they invest...why wouldn't we believe that's gonna increase the amount of saving and investment and work that people do?" That's the whole philosophy behind this bill, is to bring money back from overseas, to make America more competitive. You know, the people that are really pissed off about this tax cut are...you know, you talked about some liberals that are pissed off, the real people that are really nervous about it are the Germans, and the Chinese, and the Mexicans, and all these other countries that have been stealing jobs from America...it's not gonna be so easy anymore, because our tax rates are now lower than theirs are! Proft: Yeah, and I mean, Illinois is kind of a special case, as you know, hailing from here, Steve. And people here, in terms of the political class, not understanding that people respond to incentives, they still can't figure out why Illinois yet again this year led the nation in outmigration. They think it has something to do with the balmier weather in Wisconsin. Moore: Well the uh...*laughs*...yeah, and the good schools down in West Virginia and that sort of thing! I think...this is my point, and I think it's a very serious point; Illinois now, now that we did limit the state and local tax deduction, Illinois really does have a choice now. I mean, you are going to have to cut your property taxes! There's no question about it. If you don't cut your property taxes at the state and local level in Illinois, that outmigration we've been talking about, Dan, of people moving out of Illinois to Wisconsin or Florida or Texas or even West Virginia or Kentucky, that outmigration is going to increase! And, and, then Illinois is...you think you're in a boatload of trouble NOW? Wait until you get more and more people who are taxpayers leave the state. You're going to have mountainous deficits unless something is done. And I mean, I don't know, do you think that they will respond in that way? Proft: No. Jacobson: No. Proft: No. Moore: Now I mean, I'm talking about the officials. Jacobson: Right. Moore: I'm talking about the elected officials. Do you think they will cut property taxes? Proft: No. No! Jacobson: No, they'll try to use this to say "President Trump is bad, Republicans are bad, vote Democratic." Proft: Yeah I mean...that is what they will... Moore: But I mean you...you already vote Democrat! Proft: Yeah, I know. Jacobson: Well, they're secure their base. Proft: Obviously, if there's not a change...this is something that the voters have to decide first, before the elected officials make that decision, because the balance of power in Illinois at this point? No, it won't happen. It won't happen. Moore: Well, I have an idea for you guys. Jacobson: Please. Help. Yes. Moore: And this is a very serious idea, it was in the New York Times. Do you know what they're talking about in New York and California now? Because they have sky-high income tax, you have sky-high property taxes. They want to...they are investigating if they can make the income taxes that they pay in New York and California, where the rate is 13.5%, charitable contributions. Proft: *laughs* Jacobson: Really? Moore: *laughing* Did you see that? Proft: Yeah. Yeah. Moore: *still laughing* So you could actually get a deduction, for writing a charitable contribution to the...so maybe people in Illinois will make a charitable contribution... Proft: Yeah! They'll make a charitable contribution of their HOME, here, because that's what's happening here. Let me ask you another question before we go, getting back to national policy. Ovie Croix had a good piece in the Wall Street Journal about Obamacare, and the Republicans, you know, can't avoid dealing with Obamacare in 2018...because of course, the repeal of the individual mandate. But he points out that the Trump executive order, reviving alternative forms of short-term health insurance, gives Americans an imperfect but real escape valve from Obamacare's costliest regulation. He suggests the focus should be, this year with respect to Obamacare, not dealing with the exchanges but doing something with respect to the Medicaid program, doing a version of Graham/Cassidy focused solely on Medicaid. Do you think that's where Republicans should spend their political capital? Moore: Yeah, I do. I mean, I love the idea of letting states experiment with how to control costs for health care under Medicaid. Basically what you would do under this kind of background is basically give a state like Illinois, or a state like Utah, or say any state...a pot of money, you know, that will cov...that is enough to cover the, you know, people who are qualified for Medicaid, but saying "Look, you spend this money in the way you think is the most efficient, will provide the best quality of care for your people, and this is all you got!" So, I'll show you, you go over this amount...and we've done this in several states, where states got waivers to experiment, and they found INCREDIBLE ways to save money. I'll just give you one example, I may have mentioned this on your show before, but it's just my favorite example. In Rhode Island, where they had a waiver where they got a block grant and said "You spend the money and spend it efficiently," they added a $20 co-pay. So any time someone went to an Emergency Room that was on Medicaid? They had to pay $20 out of pocket. You know how much their...how dramatically their Emergency Room visits went down? By 40%. Just by charging people $20, so it wasn't free to people. If you do those kinds of things, states will find incredible ways to save money. Now under...you could not devise a stupider system than Medicaid. Right now, when Illinois wastes a dollar on Medicaid payments, you get 90 cents from the Federal Government, and you pay 10 cents of it. So states like Illinois actually have an incentive to waste money on Medicaid. I mean, there are states that actually INTENTIONALLY waste money, so they can get more money from Washington. It's the craziest system. Proft: Yeah, well no, that's exactly it. Going back to your point before about incentives, and how people respond to them. He is Steve Moore, Wall Street Journal columnist, Senior Economist for CNN, economist at the Heritage Foundation. Steve, thanks as always for joining us, appreciate it. Moore: Alright, have a great week guys, Happy New Year! Proft: Happy New Year!

Related Content

Who Watches The Watchdogs?

Is the Mueller investigative team hopelessly conflicted on Team Trump investigation? And to whom is the FBI answerable? Is the discipline for these entities solely reputational damage? Will anything in the Mueller report be looked without a biased outlook? What are the challenges in bringing complete harmony in the House/Senate tax bills? Will we still see a repeal of the Obamacare individual mandate or any revisions regarding state and local tax deductions? Representative for the 6th Congressional District, Peter Roskam joins Dan and Amy to discuss.

Related Content

Unleashing America's Entrepreneurial Spirit

Democrats go full "people will die" in response to GOP's competing tax cut plans. If Trump has already taken care of regulations, why do corporations need a tax break? Is slow economic growth one of the root problems of division in this country? Illegal crossings have plunged at the border under Trump but what should be his next move with DACA? Fox News Contributor and former member of Donald Trump Hispanic Advisory Council, Steve Cortes joins Dan and Amy to discuss.

Related Content

Would Reagan Support The GOP Tax Bill?

How do the House and the Senate balance the goal of growth and delivering tax cuts to the middle class? Are we moving from a reckoning of bad actors to a mania of baseless allegations? Media and big corporations have been self-accountable, but what about those in government? Who fires them? Writer at National Review, Constitutional lawyer, bestselling author, and veteran of Operation Iraqi Freedom, David French joins Dan and Amy to discuss.

Related Content

"We Won't Lose War On Terror Because Of A Trump Tweet"

Are Trump's tweets destabilizing the planet? What is Congress doing to protect due process of members accused without funneling taxpayer money to cover these allegations up? Maybe Springfield should follow suit. Should we be expecting a Christmas gift of tax cuts? Congressman Adam Kinzinger of the 16th District joins Dan and Amy to discuss.

Related Content

Steve Moore: If You Want Lower Taxes, Move Out Of IL

Steve Moore is as confident as ever with the hopes of passing tax reform after meeting with GOP Senators on the fence such as Flake, Corker, and Johnson. Are the same politicians that are now concerned about the deficit the same ones that are increasing the caps? How can the Democrats justify their stance against repealing the Obamacare mandate when the average income of those paying the penalty is $35,000? Can the failed coup of the CFPB lead to the reduction of more wasteful government agencies? CNN Senior Economist and former adviser to Trump, Steve Moore joins Dan and Amy to discuss.

Related Content

Sad Day For Identity Politics

Trump roils DC press corps by lampooning Sen. Fauxcohontas. Where do things stand in the Republican Party with the pick up of Rand Paul’s vote in moving tax reform? It’s a sad day for the identity politics’ obsessed as El Gallito unexpectedly announces his retirement. Are we going to see the sexual harassment settlements unearthed? Senior Editor for HotAir.com and columnist for The Week, Ed Morrissey joins Dan and Amy to discuss.

Related Content

Home Values Taking A Hammering In IL

The Republican's tax plan will lower home values in Illinois and contribute to the burden of property-tax-weary IL families. Homeowners in Illinois are paying one percent to three percent of their home value depending on where they live in the Chicagoland region. Will the GOP tax plan finally stoke the revolt over property taxes in IL? Should the outrage be directed at Republicans in Congress or Democrats in Chicago? Founder of Wirepoints.com, Mark Glennon joins Dan and Amy to discuss. 

Related Content

Were Alabama Voters Cheated?

Is there room for legitimate frustration and resentment towards the Washington Post for publishing the story so close to the election? Were Alabama voters cheated? Will it be hard for Republicans to simply sit out this election since the opponent is so far to the left? Will the Obamacare mandate repeal in the GOP tax plan hinder the possibility of tax reform before Christmas? Senior Editor-at-Large at Breitbart News and author of “See No Evil: 19 Hard Truths the Left Can’t Handle,” Joel Pollak joins Dan and Amy to discuss.

Related Content