.. >> at that point, wages of low end people were growing at the rate of productivity. wages of middle income people were growing at pace, and the reason was because it was the first time in 50 years we achieved full employment. we have not been there before or sense. in an economy with bargaining clout, little percentages, the

best global economy, technology economy is tight labor markets and full employment. i'd turn the volume way up on that side of the mandate, particularly in a world where price pressures are far less of a problem than job growth and unemployment. >> i'll get the last word. would you agree? >> i don't because you go back and say, well, the other time we came close to that was in the mid-2000s, a period before the bubble burst on what was happening with new technology, the nasdaq bubble, so i think it's easy to look back and said, look, the end of the 1990s were great. let's go back. there was a surplus by accident, nobody anticipated that surplus being there, and i can't remember a specific fed policy designed to get that full employment. in the long run, you cannot have that impact. that's a fiscal decision best

left -- >> wasn't washington distracted by impeachment and the sex scandal? >> yeah -- >> that's what america needs, and then -- >> least of government's best, is that what it is? >> that's why we have chuck todd. >> sorry, i needed a little comment relief here with the inflation, and static dynamic. >> we didn't get into extraalties. thank you to everyone who sponsored us, thank you for your attendance, attentiveness, and this r this draws to an end this particular panel. i invite victoria to put a bow on this morning's proceedings. >> thank you, gentlemen, thank you, congressman. [applause] today's event was filmed by c-span, so if there's any piece you want to review, i'm sure they'll reair it. additionally, the archives will

be on nationaljournal.com/event. i want to take the opportunity to thank again the underwriters, the national association of home builders, united technologies, and the american beverage association for helping make this morning possible. thank you, again, for joining us. [applause] >> extremism in the face of liberty is no vice. let me remind you also that

moderation in the pursuit of justice is no virtue. >> he lost the 1994 presidential election to johnson, but his ideas and candor galvanized the conservative movement. it's featured on this week's the contenders live friday at 8 p.m. eastern. >> gary tuck of the consumer electronics association talks about proposals with many technology companies think will help the u.s. economy. >> host: well, recently, a group of technology associations sent a letter to the deficit reduction committee asking for certain measures to help strengthen the u.s. economy. gary tuck -- gary shapiro is president and ceo of the consumer electronics association, and he's our guest on the communicators this week.

one of your first recommendations was an update of the tax system, and in your letter to the deficit reduction committee, you write that first and foremost, america's corporate tax system is globally uncompetitive, and you go on to say that we, the u.s., should take immediate steps to encourage u.s. businesses to repatriate the approximate $1 trillion in accumulated foreign earnings locked outside our country. >> guest: absolutely, peter, thank you for having me. as president of the association, we have 2,000 technology company, and many of them do business overseas, and they have money that they just leave there because the united states has this policy, first of all, having the second highest corporate tax in the development world, and second of all, taxing all international sales, which almost no other developed country does, so we pay so much, so every company is forced to leave their revenue overseas,

invest it there and hire people. it makes no sense. if they can bring it here and tax at a lower rate, and it could be tied to higher end people or capital investment, it stirs the economy and not cost the treasury a penny. >> host: what do you mean when you say "territorial tax system" in your letter? >> guest: that means in every country in the world you pay taxes in every country you make it. we're global income, so you're taxed twice on the same income. it makes the u.s. companies anti-competitive and literally forces them to leave the money overseas, and this is over $1 trillion parked overseas. it's not helping the u.s. economy. the thought is here when we need economic stimulus, have the money come back here, pump it back in the economy at a 5% tax rate, and tie it to jobs or capital investment, and that makes sense because the higher tax rates together are a deadly arsenal making us

non-competitive as a country. >> host: brenan sasso is with us here on the communicators. >> guest: thank you. there was a report last month, a similar policy that was enacted in 2004, and according to the report, this didn't actually help much. a lot of the companies that took advantage of the policy ended up using the money to increase executive pay rather than investing, so would this be different than what happened in 2004? >> guest: well, brendan, that report is one of many, and certainly the unions are opposing this for reasons i can't figure out because it could be tied to more jobs, capital investment. it's an easy thing to do. they are trying to position this as a tax give away because it's scoring government as if the companies will pay tax on that money. they won't. they are not going to bring it back tote united states, and the important thing is we recognize that these companies are american companies.

they are making money. it's a good thing. they are owned by mostly u.s. shareholders, and we should want them to succeed. it's very difficult to figure out whether companies are putting it back in dividends or hiring. you could tie it. it's effective. other democrats and republicans are now proposing that type of policy change. >> host: well, wound this be, though, another piece of peace meal legislation rather than an overhaul of the tax system? >> guest: that's true, and that's a concern i heard expressed by both sides of the aisle. this could be peace meal. this is a short term economic fix that makes sense. we need the long term thing, the territorial portion of it. change the whole tax system so you just pay on the profits you make in the country you make them, and let's deal with all the other issues, the second highest corporate tax rate in the world, the complexity of the corporate tax rate that's overbeaming, the unfairness, the loopholes, the give away, that's

important. >> host: more on the issue of tax with technology groups. we must reduce the tax rate, simplify the code, and streptsen incentives for job creating activity such as the research and development tax credit and transition to a competitive, territorial tax system. go back to the research and development. why has that never been made permanent? >> guest: well, that's a political issue frankly because it's temporary and that way the members of congress can go back to the tech community saying we'll do this for you. it's unfortunate because it doesn't allow the predict the you need, but if there was total tax overhaul, i would bet most say they don't need the r and d tax credit because there's a rational tax system here. my association never asked the government for any money for ourselves in any way including the d tv transition, so i'm

uncomfortable talking about it, but i realize why associations want it. >> guest: it's obviously to the super committee with their job to reduce the deficit. i wonder if measures that reduce taxes would be something the super committee should take up? >> guest: well, in fact, in the overall letter, we are talking about strengthening the u.s. economy. when in a terrible situation, you have three choices. you can raise taxes. you can cut spending, and srb -- and/or, grow the economy. our view is the entire political system, our nation, should get around the consensus that president obama laid out in the state of the union address that is we are an innovation economy. now, the tactics he laid out we may not agree with, but when it comes to various things making up innovation, lower deficit, predictable taxes, trade,

strategic immigration policy, step trucks, those are the things that make sense. >> guest: the last thing you said was "spectrum for wireless broadband." and there's talk that the chairman at the fcc mentioned the spectrum crunch that there's not enough frequencies to be used for wireless devices. can you explain that a little bit? why do you think there should be more spectrum for a wireless device? >> guest: well, we have fundamentally changed technology as a world and country in five years. five years ago there was no smart phones. those phones use 25 times the data stream that the phone did of five years ago. tablets like the ipad -- an ipad uses 120 times data stream, and these are the engine of our economic growth, of all the new economic activity, and people expect, and it is now a matter of national policy, a bipartisan, that we want wireless broadband, it is

essential. we need the spectrum to do it. at the same time, there's government spectrum that may be available, and there's the broadcaster's spectrum which is fewer than 10% of american homes rely on that signal. the proposal that the fcc had, we supported, the president supported, bipartisan support, it's voluntary options of the broadcasters for some of the spectrum. not saying get rid of it, but there are lots of stations in each market, plenty available, and give them the right to auction it off through the government to raise money, and the estimates of raising money are between $15 billion and $40 billion to the treasury one time benefit, and then there's economic activity and wireless broadband, but it's a mathematical certainty as time goes on, long term, we will not have the devices working the way we except them to because there's not enough spectrum

available. >> host: gary, don't the wireless device makers also have a responsibility to use spectrum more efficientlying? >> guest: absolutely. there's solutions being developed like relying on wifi in local areas, but still, mathematically as of now, half of the americans have the smart phone, and the tablets are the hottest product of the tablets and we anticipate growth for years to come. we need a system to support them. >> host: in your letter to the deficit reduction committee, you write it's important to make more spectrum available for mobile broadband, including the benefit of unlicensed units. what do you mean? >> guest: okay, verizon, at&t, and google would bid to get spectrums.

there's something no one predicted like the garage door opener, cordless phones is another. there's products we come to rely upon, and that is -- anyone can produce something. there's various standards in terms of being a good neighbor and accepting interfernings, but that produces a lot of -- save slices where the government would not get money. that spurs economic growth, activity, and jobs. >> host: brenan sasso? >> guest: shouldn't google or microsoft, why shouldn't they have to pay? since we talked about how valuable spectrum is, why shouldn't they pay like at&t or verizon pays? >> guest: when you pay, you get the exclusive use. without license, nobody pays. it's a parkland everybody owns. everybody can go in and play. everyone benefits. anyone can enter the space.

i'm not worried about google, at&t, and verizon. they own it which is fine. they control -- they can do a lot with it, and they can use it for what we've been talking about unlicensed uses or any uses, any entrepreneur can jump in and produce great productings whether it's family radio or communications or the garage door opener that many of us rely upon. >> guest: there's a lot of different parts of congress, the super committee, the separate bill, dealing with spectrum, and so i'm wondering how you think this gets done? what is the most likely avenue? also in the president's jobs bill, that's looking less likely now, but this letter to the super committee, but is that the main way this gets done? >> guest: it has bipartisan support, and the broadcasters are willing to do it under certain conditions. they get licenses. they never paid for it. they get money from it even

though it's not something they own, but whether the super committee is going to resolve the bigger issues of the country is -- nobody knows at this point. if they do, this is almost certainly going to be in there. if they don't, we have a lot of other issues as a nation, but a along the way, this is a solution that helps cut the deficit and spur economic growth. >> host: gary, are the tech community needs different than the larger business community? >> guest: great question. i think the tech community might have more of a need for the brightest people on the earth, and that's what made the country great. we attracted them traditionally since our birth until about september 11th, and we 4 the disaster and then shut our door, and now it's very difficult for tech companies to get the brightest people. we're not welcoming to them. we shut the door on them, and they are the growth engines of the economy. this is where maximum growth occurs is with technology. with technology, we do have needs. we have needs for quick capital,

flexibility. you have to be able to move people around. it's not a pro-union environment because you have to assign someone, give them the process to make money or move to the next job. this is a country where you can fail, and it's not -- it's actually a badge of experience, not a badge of dishonor when you do that in business. we have a questioning nature. we have a first amendment to protect us, every ingredient we need to be the best in the world, and that should be our strategy in the country. the pinnacle of that, i include biotech in that and i would include, frankly, the creative community in that, the motion picture industry, the publishing. we are the world's innovators, and that is our perch, and we should stay there. yes, we are unique, but this is who we are as americans. we solve problems. >> host: back to the letter to the deficit reduction committee. you talled for, with regard to visas, increased the number of prelim-based visas for highly

educated workers, award permanent visas to foreign born students who earn dock rats, and repeal the number of applicants per country. >> guest: absolutely. our forefathers came here for a better life with nothing to lose. education is an export of ours. that's what we do. we have really bright people, we educate them in math and science and information technology. we give them master's degrees and ph.d.es and then we kick them out of the country. that's crazy. republicans and democrats agree on this. we have to get the legislation threw that allows us to give them a pass to citizenship, and we have to strategic in the immigration policy. it's all about illegal immigration. what's at issue is who do we want here? we want bright, entrepreneurial people, people to be great citizens to contribute to the economy. there's great proposes out

there, bipartisan, someone's willing to invest the money, hire a certain amount of people if they are innovated. they are like every company. they want to hire people. why open a facility abroad to do that, yet our trade policy increasingly encourages them to go abroad rather than create jobs here. >> host: i want to go to an earlier question. these are a lot of different issues, but not necessarily deficit reduction issues. what was the purpose of including visas and other issues in your recommendations to the deficit reduction committee? >> guest: deficit reduction comes one of three ways, cutting taxes, cutting spending, or raising economic growth. we have to about growing economic growth. we have stalled economically as a country. it's hurting us. indeed, a lot of companies now, and venture capital goes abroad because there's not growth in the united states. we must be a growing economy. a growing economy will solve the jobs problem.

it will go along way to solving our deficit problem, so we should be focus laser-like on growth rather than focusing on saying business is bad and attacks business. we have to say business is good. we want employers here. we want jobs here. we want innovation here, and that's what this is about, and if we can grow economicically -- look, the federal government, state governments now, every one of the 50 state governments assume in their pension calculations that we will grow at 8% a year. that is insanity. we're not growing 8% a year. we are facing a huge financial challenge in the country. we have to try to get to that 8% growth rate. we are not under today's policies and whether it's democrat or republican, we have to get together and get the policies to allow economic growth. >> host: you're watching c-span the communicators program, and our guest is gary shapiro and brenl -- brenan sasso is with the hill newspaper. >> guest: unemployment is still at 9%, and people are

having trouble finding jobs, and even people with degrees, so what do you say to the person who, you know, just invested in education, just graduated with a degree in math our engineers, and they can't find a job, and these tech companies want to hire foreign workers? >> well, first of all, there's several million jobs available in tech companies and other companies where we do not have the experienced people or the people who write when we need whether it's in precision engineering or manufacturing or design. first of all, go to any college student and say look at the jobs -- gear yourself. if you can't get a job, it's because you invested in the wrong subject, and it doesn't make sense. maybe it's good for society, but we need skilled people. there's a lot of jobs that are open. to the people who say foreigners take me job, that's not the case for the most part. the jobs go overseas because the policies encourage them. there's not an american employer who i i know that wouldn't

rather high a citizen of the united states. they want a better future. they'll always give the job to the american over someone from overseas. >> guest: switching topics for a little bit. the letter mentions briefly protecting intellectual property as an important issue, and so obviously, there's bills in both houses of congress now, protect i.t., and so you, you though oppose those bills, and so i'm wondering why are those bills not the appropriate way to protect intellectual property? >> guest: well, intellectual property trademarks, copyrights, are very, very important domestically and internationally, and what we're doing with countries like china we have to recognize we have a different my philosophy. they just can't make copies of our trade works. they can't rip it off. our pa tented products, and our software and just steal it. that's wrong. the legislation you're talking about is aimed at pirate websites, which are horrible and wrong and should be stopped.

it's not that we oppose the principle. we oppose the fact that all the sudden you give any private party the claims to shut down a site without any process protections or government. you create now private rights of action and you shut down the internet in a very large way. look, the this year, the government shut down 50,000 websites, and because they are in one child pornographer. 50,000 legitimate websites shut down for a few days with a big sign saying shut down because of child pornography. those are the mistakes you want to avoid. avoid legitimate businesses from being shut down without processed protections. the bills are good, but let's modify them so protections americans are accustomed to are in place. >> guest: what would the changes need to be in order for you to support the bills? >> guest: back to the drawing board. we're excluded from the discussions all along. the content community, which is very, very politically powerful, went to the favorite members and

dropped legislation in. what we need to see is due process. you have a right to answer, to respond. you also have to have a process to ensure you're shutting down the right website and not thousands of those. we don't want the internet shut down, and democratic congressman, women and alike, a senator from oregon, a democratic senator, as well as republicans said these bills are absolutely unacceptable for the future of technology. >> host: go ahead, brendan. >> guest: my understanding is the bill has an appeals process where if your website is shut down, you can appeal and say this is a legitimate website. is that not enough? >> guest: your website is shut down, and you have the right to go through a government process for an appeal, and meanwhile, your customers are lost for how long? i mean, when blackberry has an outage, it affects millions of people. when a website has an outage, it can mean the life or death of

that company. >> host: you mentioned the content community. what do you mean by that? >> guest: it's hollywood, the music industry. basically, they live and die by government regulation. government started out with a monopoly where a patent was equal to a copyright. we lost site of that. because of phenomenal lobbying, it's 100 years, expanded 13 times in 40 years. the penalties are outrageous. people go to jail. if you rip off a cd on your computer, the prison sentence and everything else is so much more than if you physically steal the cd from a store, and then, so the content community is a phenomenal fundraiser, phenomenal, and they play the jew -- judiciary committee. they get a phenomenal amount of money from the content industry lobbyists, and the tech industry is not good at fund raising frankly, so you have republicans

and democrats getting all the money from the contents community, and they have a very good way with themselves in the judiciary committee. >> host: another piece of legislation that's making its way through congress is representative mary bono macs data security breach legislation. what's the position on that? >> guest: actually, we don't have a position on that. as we go into the cloud and give up information, these are really critical issues coming for us. how much of your information do you own? what's the responsibility of a company that uses it? what happens as we proceed along? there's so much more happening in the application world about gathering information about yourself, your where abouts, what rights you have, but i think in a reasoned way, public policy can deal with the issues. when the credit card was first introduced, there was great concern about losing everything, and congress did something smart saying, you know what? the most you'll lose is $50 if you lose the credit card. that unleashed a great use of credit cards, but helped the economy with financial

transactions, made the passing of dollars bills a lot less, and it's helped society. we'll find our way out of the privacy issues recognizes the tradeoff between someone knowing about you and then serving your needs. you can't get a suit if the tailor does not know your size, and sometimes you have to give up your size. >> guest: the bill is focused on financial information so if someone hacks into a website and steals your credit card number, but what about broader privacy issues? there's talk of privacy protections. what do you think about that legislation? >> guest: well, there's lots of proposals out there, and they are critically important issues, and when my hope is that wework through them in a logical way where we agree upon the facts and agree upon the goals and conflicting interest. protecting the person's privacy, medical privacy, versus the society of greater. i know everyone hates the health care law, probably including me, but there's good things in there, and one is doctors share

information about actual things that happen on an anonymous basis for patients so there's a data base of treatments which we don't have now. there's a tradeoff between societal needs and individual needs. we have to recognize government plays a role in addressing the conflicting of interest there. >> host: back to the letter. we recommend you write greater investments in those activities with clear economic benefits because of their transformative potential. programs that support basic sign civic research, improve our infrastructure, protect our intellectual property, and create a 21st century work force are smart investments. >> guest: absolutely. take our university system, which is the world's best. the government pours a lot of money in there for basic research and development and works out very positively for industry as well. and there's a lot of work between the university community and the private investment community, and it's produced great things, but there's only so much available. we have to be very careful and say what's the different here? that doesn't mean we're

embracing to give to companies like solydra and be the venture capitalists of government. there's a difference between basic research and development and applied research, and investing in companies. if there is going to be government investment, it should be at the highest level of basic research in my view. also when it comes down to an educated work force, the government played role. do we want every person to go to college? i argue we don't. germany is a great example. they have two tiers. they have nose who are highly skilled people, location education, and they produce great cars, health equipment, and their strategy as a country is precision manufacturing, and it's working, and the people have high status and they get paid a lot, frankly. they have educated people and universities and things like that as well. we have the philosophy that everyone has to go to college. it doesn't make sense. it doesn't compete. if we want manufacturing in the united states, we have t