rob matheson, al jazeera. a volcano has erupted in northern mexico and ash and smoke rose more than 3,000 meters into the air and mexico's most active volcano and more on our website al jazeera.com. ♪ you could be forgiven for thinking you wandered into the wrong conversation when you tuned in to republican candidates debate on economic issues. but once you threaded your way past the mean media asking terrible questions, what candidates biggest weakness was or whether or not fantasy football was a fit subject for debate there actually was some economics in there, show me the money. it's the "inside story."

♪ welcome to "inside story" i'm ray and we watched so you didn't have to and believe me we did you a favor. the republican candidates for president squared off in two debates last night in bolder, colorado and after two hours and 15 minutes in prime time the top of the card climbed out of the mud wrestling pit and headed for the spin room and occasionally informative and often infuriorating and entertaining if you like that sort of thing and david shooser reports. >> this is fascinating like getting rid of medicare and medicaid. >> reporter: john blasted away at republican rivals and while it is true that ben carson once

suggested the government get rid of medicare carson's position has changed. still with kasic firing away donald trump hit back hard. >> this is the man that was a managing general partner at lehman brothers when it went down the tubes and almost took every one of us with us including ben and myself because i was there and i watched what happened and lehman brothers started it all and he was on the board and a managing general partner. >> when you talk about me being on the board of lehman brothers, i was not and i was a banker and proud of it. >> he is correct and not on the board, a managing director one of hundreds at the organization. former neurosurgeon ben carson disputed an acertain shun made about his past and denied being more than a paid spokesman for a controversial supplement company called manatech. >> i did not have involvement with them, that is total propaganda and what happens in our society, total propaganda and did a couple of speeches for

them and paid speeches and it's absurd to say i had any kind of a relationship with them. >> but five years ago carson credited that company with funding a multi million dollar endowment in his honor. >> it requires $2.5 million to do an endowment share and i'm proud to say that part of that $2.5 million came from manitech. >> the republican debate under scored sharp divisions over social security. >> yes we have stolen and lied to the american people. >> and mike huckabee and donald trump wants it and chris christie wants to cut the program and justified it this way. >> all that is in there is a pile of iou for money they spent on something else a long time ago and stole it from you because now they know they cannot pay these benefits because social security is going to be insolvent in seven to eight years. >> reporter: , in fact, social

security will not be insolvent for 20 years and the program would still be able to pay partial benefits. as for the iou they are actually u.s. treasury notes, government bonds considered the safest bet in the world. several republicans hammered president obama's economic policies. >> for the first time in 35 years we have more business as closing than starting. >> reporter: , in fact, according to census bureau data that trend started seven years ago at the end of the bush administration and carly fiorina attacked with this. >> 92% of the jobs lost during barack obama's first term belonged to women. >> reporter: u.s. labor statistics say that's not true. and to her overall point employment was actually higher for women and men at the end of president obama's first term than when he took office. altogether fact check groups said it featured more than 20 questionable claims. >> my apologies, i'm sorry. >> really doing some bad facts.

>> david shoe sterwith al jazeera. show me the money and we will leave the show biz to others on this edition and concentrate on what the audience now knows about what these 14 or so candidates want to see on the economic front, once one of them raises a right hand and takes the oath as president. joining me for that allen cole an economist at the tax foundation center for tax policy and a political consultant and principal at fdj solutions and herry steen director of fiscal policy at the center for american progress so gentlemen if you sat with a note pad in your lap and picked out the actual serious economic points can you say after having seen the three hours or so that there is a general approach to economics that's being aspoused by the republican candidates, allen? >> one thing we are seeing from

republican candidates is tax reform and specifically a lot of the candidates are looking at ways to improve the incentives to work and invest in this country. one thing that a lot of them have in common is eliminating tax deductions especially the state and local tax deduction and using that to pay for lower rates. a lot of them they are looking at is moving businesses to an easier system for accounting for their capital expenditures but on a number of other tax issues and policy issues there seems to be a lot of broad disagreement too. >> and your foundation scored the various plans, we will talk more about that later in the program. harry steen same question. >> i think you saw a definite commitment to what i guess you could call tax reform although when you look at the cost of these plans anywhere from 2-10 trillion over the first ten years alone debending on which plan and estimates you are using

it's giant tax cuts than today's serious tax reform. the biggest things they all have in common is huge tax cuts at the top and wealthy individuals and corporations and what is interesting is it seems to be a price of admission for running for president with the republican donor class all of the candidates have this in common but when you actually look at the polling of normal republican voters, only about one in five republican voters think that wealthy people are paying too much taxes and this is not a position contrary i think to conventional wisdom that republican voters hold. >> fredico did we learn anything new about the approaches or proposals to economic questions? the earlier debates were kind of all over the place, but this one was meant to really zero in on questions of earning, spending, paying. >> well, there were a couple of points that i think were interesting, number one rand paul was the only one who said he would be willing to raise the retirement age and age of

eligibility for medicare. he also said he wanted to get rid of or cut the payroll tax which is very unlike republican proposing that type of thing. but other than that and a couple of flat tax proposals there was not a lot of meat into what the plans they were saying and mr. i forget your name sorry so you were tax foundation was quoted as saying mr. carson's plan would blow $4 billion and the deficit would increase and a lot of these proposals so i think that as side from a couple of writers like for example getting rid of interest like mr. trump and cruz would say i believe there was a lot of rhetoric about the 1% but most other policies would favor 1% and would actually expand instead of addressing it's. >> more commonalities or differences, he mentions that trum ee ee eel trump is virtual talking about the hedge fund loophole and hearing ben carson

saying he would go to a flat tax of an undetermined rate and get rid of all the deductions, is that politically plausible? >> not all tax plans that are produced in primaries are necessarily politically plausible but they do tell you about the kind of broader vision that the candidate is astousing and none of the things i examined or looked through are necessarily filled with the sort of detail that you would see in a real legislative text. that said, dr. carson has been unusually low on specifics to the point that actually we haven't yet modelled any proposal of his because we are short on the details that we would need in order to do so. >> we will talk more about the scoring a little later in the program. gentlemen stay with us, one of the few moments where there was some kind of attempt to hold a sustained give and take on a pressing issue was on social

security and medicare, we will take a look at current gop thinking on the two massive programs and their future if these men get their way and one woman carly fiorina show me the money, it's the "inside story."

>> ali velshi, lifting the lid... >> cameras in place for money and not safety. >> on the red light controversy. >> they don't give two cent about your safety. >> there's an increase in rear end accidents. >> ali velshi on target: hitting the breaks. ♪ the government has lied to you and they have stolen from you.

they told you that your social security money is in a trust fund, all that is in there is a pile of ious on money they spend on something else a long time ago. it's their money. this is not the government's money. this is not entitlement and not welfare. this is money that people have confiscated out of their paychecks every time they got a paycheck the government reached in and took something out of it before they ever saw it. >> reporter: you are watching "inside story" i'm ray and show me the money in time on the program looking at the economic ideas put forward in the republican candidate's debate and one area that brought up some interesting exchanges were the two giant pillars of the debate over the future of the federal budget, social security and medicare and our guests are with me and harry when a candidate for president of the united states says it's their money is that an interpretation or a misunderstanding of how the

program works? >> i think it's fair to call it an interpretation in that especially talking about social security people pay money into the system, they don't have individual accounts so it is just one big trust fund that the money goes into. but their benefit is determined how much they have paid in and for medicare as well you have to earn the benefit paying in for a certain number of years so i think it's fair to say people have earned the benefit paying in the system and whether it's strictly speaking their money is a matter of interpretation. >> is it fair to detach social security from medicare to a degree because one is kind of fee for service and one is totally different because you are paying in for your whole working life in anticipation of a benefit at some other time, every time it's called an entitlement, i bridal a little bit because, boy, if you pay for 40 years for it it doesn't seem like an entitlement. >> sure, they take it out of

your paycheck and there are reforms that need to be made and it was interesting that they were mentioning and disagreeing on whether they should test the programs when they clearly are already means tested and so they try to sound a popular stone when the record shows they raided these programs like christie said. on the money you didn't ask about this but carly fiorina said she would get rid of minimum wage altogether and didn't get push back from any candidates and i thought that was very interesting. >> to say to a national television audience you've been lied to and you've been stolen from, that's a pretty profound statement. is it rooted in demonstrable fact? >> i think the mechanisms for social security are largely pretty clear. there is a payroll tax. you pay in to the system. and then -- >> as does your boss. >> true. and then the system invests in

government debt. and some people say that's just an iou but the truth that all financial instruments are ious and then eventually you get a benefit back. now maybe that benefit isn't worth it, maybe you would rather have the money now, maybe you would rather invest it yourself and that is fair to vote on but to say the system is particularly okay or difficult to understand i don't think that would be particularly fair because other retirement plans also function in fairly similar ways, you contribute and get something out at the end. >> governor huckabee is pushing back most of the field when it comes to tinkering with medicare and social security but he made an interesting point about preventable disease that you don't hear and usually it has to do with the finances and how we are going to pay for keep people well ten and 20 years from now. he pointed out that the big four

heart disease, lung cancer, diabetes are preventable through lifestyle changes and would save a lot of money if people ate better and exercising more and all that and it was kind of refreshing in a way. >> i think there is kind of to different ways i think of going about reforming the healthcare, major healthcare programs medicare and also medicaid. one way is you ask slash people's benefits and different ways of doing it and think that is the wrong approach. the other way is to try to make the programs spend more efficiently and actually doesn't get a whole lot of credit but the affordable care act, obamacare does a lot to try to reform the healthcare system, spend money more efficiently including in other federal healthcare programs and has a lot of money invested in just that, in prevention and actually unfortunately that prevention fund is one of the places that republicans in congress keep trying to go to when they repeal the affordable care act to take money out of that fund and makes no sense. >> just before the break our

campaigns and you worked on campaigns, are they a good time and a good place to talk to people about big complicated issues like medicare and social security? >> well, they are not prone to. barack obama and hillary clinton and neither of the republicans actually talked anything about the nuts and bolts commission until after it was approved and you obviously don't don't go in a campaign promising huge entitlement reform but the idea that was in the debate and rand paul would be the exception about raising retirement age is not popular and getting rid of payroll tax and said the employers would take it on and you say a lot of promises and rhetoric and not a lot of detail and honestly on c nbc you would expected more detail on financial issues. >> regular viewers know we looked at two core propositions of republican economic theory on last night's program. now the balance budgets and tax cuts sometimes without a hint of

worry that onectually works against each other and talked about auditing the federal reserve and even returning to the gold standard but no matter where they roamed they always came home to tax cuts and balanced budgets. show me the money. it's the "inside story."

♪ it is a simple flat tax where for individuals a family of four pays nothing on the first 36,000. after that you pay 10% as a flat tax going up. the billionaire and the working man no hedge fund manager pays less than his secretary. >> the problem is we never get it done. we have talked about tax reform in every single election for decades. it never happens. >> reporter: welcome back to "inside story" i'm ray suarez the moderators talked about

large and broad based tax cuts and balancing the federal budget and talked about flat tax plans and a three-page federal tax code but no serious sustained explanation of how you make very large tax cuts and balance the federal budget while expanding military spending at the same time, something supported by virtually all the candidates. allen cole and dejesus and they are with me and scored the various plans that have come out so far and does anybody have a trajectory to getting the federal budget to balance? >> the candidate who is closest to that is probably rand paul. rand paul one would think would be a big tax cutter but actually he has got a 14.5% income tax that is very broad based and 14

1/2% subtraction method value added tax and putting these to together with degree of getting rid of deductions and it's under $200 billion a year and rand paul is the sort of candidate and libertarian and going out there and say what programs he is willing to cut. >> what about marco rubio because there was back and forth about whether, in fact, their tax cuts would be irresponsible because they would increase the size of the deficit? >> back and forth between ruboa and the moderator is more about who would benefit from the rubio tax cuts and the truth is some very wealthy americans and some very poor americans would benefit from those tax cuts alike. the wealthy from the elimination of capitol gains taxes and the poorest americans from the big child tax credit that he

proposed with senator mike lee. >> does anybody, harry steen, have a plan that also lays out what you cut to get to balance because if you are going to take away revenue from the federal government you have to cut things it's spending on to get it to balance. >> i don't think anybody has laid out the detail that will tell you what needs to get cut. i would say the closest you get to it and this is going to give him more credit than he deserves is john kasic who laid out a balanced budget plan who is spec about what he would cut and vague in a lot of cuts are just cutting a big you know cutting big programs like medicaid and sending it to states and having them figure it out but about the plan a lot of the deficit reduction comes from higher revenues and how does that happen because john kasic is proposing giant tax cuts and he is saying not only will tax cuts

pay for themselves they will more than pay for themselves and generate a whole bunch of extra revenue from cutting taxes. now, again, this is coming from the person who is supposed to be the serious guy in the room, the guy who started the debate with the rant about how donald trump and other guys are a bunch of clowns and it should get you laughed out of a serious budget conversation and he is going even beyond that and that setting an extremely low bar. >> if it's appealing in the ears of voters to hear about cutting spending and cutting taxes, do we take into account in our political conversations that when you cut government spending you also cut things that middle class and working class people and poor people like that they get from the federal government, that there would be pain and sacrifice on the part of those people? >> not in my backyard syndrome, everybody is for it until they touch some benefit for themselves but to go back to

medicare we just have a house speaker elected who decided to privatize medicare in his most controversial budget in the last resent years. ted cruz wanted to get rid of irs and pay taxes through a post card and like the dynamic scoring under bush years and increased the definite by billions and trillions and it's not an evidence based process they are going through in their proposals. >> at long last is there any evidence because it's sort of embedded in a lot of these tax plans that cutting taxes raises government revenue? >> the tax plans that we have looked at, they will grow gdp somewhat but they cut revenues by larger percentage than the amount at which they grow gdp so the answer is that they don't typically pay for themselves and the only way you could possibly get to that point would be by getting rid of some bad taxes,

putting in some taxes that are a little bit better for the economy and kind of running a balanced approach but so far what we see from republicans is more on the lines of across the board tax cuts and that is not going to pay for itself. >> i want to thank all my guests allen and cole who you heard economist at the center for tax policy at the tax foundation and harry steen the director of fiscal policy at the center for american progress and de-jesus a political consultant and principal at fdj solutions, i'll be back in a moment with a final thought on last night's refrain, the real refrain, yeah, but, stay with us, it's "inside story." ♪ coming up, at 7:00 eastern al jazeera america republicans get their man, paul ryan is the new speaker of the house and can he work with the white house and his parties conservative block? unrest at the austrian border

and dealing with a crush of refugees and a change to china's one child policy and critics say it doesn't go far enough and disappearing snow packs and the effects it's havin

♪ candidates forums like last nights are a blessing and a curse for someone who follows issues like the economy closely. the blessing comes when it's finally brought up as part of the conversation that some of social security's problems come from the 1980s grant bargain that put the program on solid footing for decades to come and also allowed the congress to spend the huge surpluses. the fica taxes you and i paid that didn't immediately get paid out in benefits to our parents and grandparents. then there is, yeah, but, the

same ronald regan who is constantly celebrated in debates is the president who over saw the grand bargain that got us to today, personal responsibility is beloved of the candidates and drives a lot of the theorizing social security and turning it into a plan and less social insurance, yeah but some privatization wouldn't protect people from their choices and bad luck but force them to feel the full impact of them. as in the great meltdown we just lived through a few years ago when it became apparent that millions of americans middle aged and older have not reference saved enough for retirement. unless you count enough to get you through a year or two of retirement as enough. there is always more to the story and these debates give us an opportunity to hear candidates say nice things about their parents but it never feels there is enough time for yeah

but. i'm ray suarez, and that is the "inside story." ♪ >> this is aljazeera america. live from new york. >> to me, the house of representatives represents what's best of america. >> speaker of the house, paul ryan, promises a new era on capitol hill. the challenges within his own party and with democrats. culture clash, saudi arabia's concerns and demands to the u.s. as iran enters peace talks from the syrian war. >> . >> family