>> what's unique to washington, especially this time of year? >> it's a good question, and a lot of people complain about china's unfair trade practices, but when it comes to getting them to stop, that's where the rubber meets the road. on this, mitt romney is absolutely right. we have not been nearly tough enough in dealing with china on currency. and just a 30-second primer for your viewers, currency manipulation is when one country enter veeintervenes in a way to the value of its currency in order to gain market share or some form of advantage. if the free market determined the level of exchange rate of currency in china, it would be much higher. in fact, it would be 25 or 40% higher than it is now. that serves as a defacto export subsidy for products coming from china to the united states, and it serves on a tax on our goods trying to go to china.

it makes them far less competitive. mitt romney is right to complain about this. the president has had six opportunities to name china as a currency manipulator, which would trigger a series of negotiations aimed at ending this practice. he's refused to do that, the president has refused to do that. the senate has passed a bill with an overwhelming bipartisan margin as one of the few times the democrats and the republicans came together last year to pass something, and it would happen in the house of representatives if speaker boehner would let the bill come up, but what it practically would mean is that china would face penalties if it did not end these practices, if it did not stop manipulating its currency, if it kept dumping products into our market, and it would face tariffs. and usually what happens in a case like that is that the offending country will end the practice because they ultimately want access to america's consumer market. and even though we're only 5% of the world's population, we have an outsized consumer role to

play. we buy a lot of stuff, and people want access to our market. we're afraid to use that based on some sort of a philosophy rather than looking at the facts on the ground. as a result we have a $272 billion trade deficit with china, and that means we've lost market share, it means we've lost wealth, it means our gdp is lower than it should be, and it means that ultimately we're going to have to pay back that just as we have to pay back our budget deficit as well. >> next call, southern pines, north carolina, a republican. good morning, norman. >> caller: good morning. thanks for letting me talk a little bit. >> sure. >> caller: our biggest reason for the national debt in my training is free trade. our manufacturers have to pay 35% of the profits to the government while foreign countries get away with nothing. this gives the other countries a 35% profits over our country. make it the same as things built

here in the u.s. bring back the manufacturing in this country and employment will increase. this will not only create jobs but income tax from these workers and companies. >> free trade is a double-edged sword. we certainly want access to markets overseas to sell our products, and it's important to growing exports. i'm in favor of initiatives that allow open markets to overseas. i think that's critically important to our growth. but i think our trade policy has definitely not looked enough at imports coming in and the impact that they have on workers and on industry. and the challenge -- and i think, norman, the caller, touches on this a little bit -- is that if you lose a job in manufacturing, that has a ripple effect throughout the entire community. it's fair to say that if you attract an auto assembly plant to your hometown, you're going to get a hospital, you're going

to get a school, you're going to get a walmart. but if you attract a walmart to your hometown, it doesn't necessarily follow that a factory is going to come behind. that's the importance of manufacturing to our economy. our trade policy has not been focused on that, and it need to be. it needs to be much more results oriented. it needs to look at how we're performing against other countries, and we need to be much more aggressive about trade enforcement and the president has talked about this. he's actually adjudicated cases very fairly that have been brought to the private sector. but this is like putting fingers in the dam, and what we need a comprehensive policy that says we're going to lower our trade deficit and restore american greatness in production, and that's ultimately what a manufacturing policy has to be about. >> from that interview that the president did with matt lauer leading up to the super bowl yesterday, we pulled out a small bit about manufacturing that the

president pulled out of our economy. >> we created the most jobs since 1995, the most manufacturing jobs since 1990, but we're not finished. we've got to not only boost up american manufacturing so that not just the auto industry but all of manufacturing is building again and selling overseas. >> usa today breaks it out further here. 50,000 jobs created in manufacturing since january, and in this chart they talk about durable versus non-durable goods. they say the area of durable goods like cars and metals and car parts, 7.4 million, 44,000 was the change in january, non-durable goods, about 6,000. makes me want to ask more about the auto industry since you brought it up, mr. paul. here's a headline in the wall street journal. the target at post-bailout gm: earning $10 billion a year.

boy, have things changed. bailout is a word they use and a lot of our viewers use. is this a good idea and should more of this happen? >> first of all, it was emergency room care, and you never want to go to the emergency room, so i'm not going to make an argument that more of this should happen, because it was in response to a crisis. but the way in which it was managed, it wasn't perfect. i don't know that steve rattner and the president did a perfect job on the rescue plan, but they constructed it in such a way to allow it to succeed. and there are a lot of myths about what the rescue did and did not do. the auto workers, the unionized auto workers, took a tremendous cut, and did they get a stake in the companies, actually? yes, they did, but it's going to make the companies more profitable, and i think that's important for callers to understand. but they also took a big haircut in terms of the wages, and they took on more responsibility for

administering the benefits to retirees, and those were major concessions that the auto workers made. in return, there were also plant closures, and so there was a downsizing of the industry. there was a dramatic downsizing in terms of the car dealerships and the retail outlets. all of this was very controversial, but at the end of the day, when you look at chrysler, ford and gm now, and you look at the fact that consumers have better choices for automobiles across the board, the industry agreed to a 54.5-mile-her-gallon standard together with the auto workers and the administration, which is an achievement in and of itself. and you see profitable companies and the government will be able to sell its stake in gm down the road at perhaps a wash to taxpayers, and you have to say,

if it's going to grow jobs in the future, it's absolutely worth it. because unlike these financial institutions, these car companies are making real things that employ real people and things that people buy around the world, and that's important to our economy. >> that being said, one of our viewers via twitter a little confused about this. here's what this viewer said. i thought we needed to have government get out of the way. now i'm hearing that government needs to make wait. which way is it? >> i think it's important to understand that i don't want to see the government run ag factory. the united states government shouldn't be running factories, and that's not the right kind of industrial policy. but every successful industrial economy around the world has public policy that supports it. when you look at germany, germany has over 20% of its economy in manufacturing today. it has been able to kind of

withstand a lot of the global recessi recessionary thing because it makes a lot of thing. the percentage in our economy in manufacturing is under 12%, and it's stable now but it had been shrinking for a long period of time. germany is not a low cost place. german manufacturing workers make about 45 or $48 an hour, in the united states they make about $32 an hour, germany has a national health care plan, germany has very strong unions. but in germany the difference is that all the political parties say we value manufacturing. we want to keep manufacturing jobs in the united states. we want to form an education and training program that's going to prepare young people for these careers, we want to make our capital a little more patient so we're not worried about quarterly earning statements, we're worried about long-term grow growth. and there are government policies that can help produce an ecology like that that helps manufacturing to thrive. what we've experienced the last two decades has been an adjunct

failure, and that's free trade, tax cuts and a laissez-faire attitude. i think we need smart government policies to help support private sector entrepreneurship and competitors. >> next call, dale from arizona. thanks for hanging on. you're on with scott paul. >> caller: good morning. please give me a little time to speak because i always have a lot to say because i listen to cspan. that's the reason i have a lot to say. >> go ahead, sir. >> caller: i'm going to make some comparisons, such as 93% tax hike because we had to pay for the wars, and when jfk came in, there's a big hullaballoo from the republicans especially that tax rates had to come down. they did somewhat. but they've been on this crazy thing about tax cuts, you know?

when you consider that in 1959, you know, that strike, the united steel workers manufacturing steel, making steel, i was a steel worker. not then, but i followed all this stuff. there was a climber for 3.5% wage increase over the contract, and i don't think that's too much. we need unions to represent people because people are the ones that create wealth. companies do not create wealth, they move wealth around. and what you've seen in the recent past, especially in the last 12 years, is that wealth has been moved all the way to -- all over asia, let's say, 2 billion people, right? which is good for them in the long run and it's very bad for us in the long run also. and the immediate is that people suffer here. so let's make another comparison. you know, when this economy was going down to hell -- pardon my

language -- interest rates was getting up to 27, 30% interest, stuff like that, you know what that proves? that people weren't paying their debts. and when people manipulate money, they get greedier and greedier. >> let's hear from our guest. >> i think we've seen long-term trends that have made it very difficult for manufacturing to be competitive. taxes are a piece of it but i come at it from a different approach. i don't think it's necessarily the corporate tax rate because there have been well publicly sized cases of companies that are paying a well below tax rate. i think it's because our manufacturers have to compete against 154 other countries that have what they call a value added tax system and one that is rebated for their exports. you have no tax advantage in the united states if you're exporting products, and that's what you want to do if you're a

successful economy. it helps generate income in the united states, it helps balance your trade account, it does all sorts of very positive things, but we have a tax system that has no benefit whatsoever for exports and has a lot of incentives in it for offshoring. and until we figure out how to reconstruct that, and that's a much bigger product than simply figuring a tax reduction, we'll be at a disadvantage and have to make it up in other ways. >> frank, independent, good morning. >> caller: yes, hi. good morning. thank you for taking my call. i kind of look at this in a simple way. i look at it -- i go back to the day when ross perot was debating bill clinton and george bush for the presidential nomination, and ross at that time -- i'm guessing that was about 20 years ago or so -- at that point, as i recall -- i come from an

engineering background, and we were a very, very rich country. all of our shelves and all of our stores across america filled with american goods. they no longer are. people maintained their homes, et cetera. the point is that ross said if we demolish or destroy our fair trade agreements and go to free trade, we'll hear the giant sucking sound of all of our jobs leaving the country. and of course clinton came in, and for the next eight years, free trade. bush came in, for the next eight years, free trade. obama sheer now, and the republicans and democrats just agreed on something, three more free trade agreements. i think this kind of makes the case. we can't be expected to compete with people who make 50 cents an hour, $2 an hour. we had a great -- you know, and

i'm insulted by even the president. i voted for obama. i'm insulted when he gets up and says we have to educate our people better to take on more advanced jobs, et cetera. we had those educated people. we were there. we had a rich country. we had r and d. >> thanks for the points, frank. mr. paul? >> frank, first of aushlll, i t you brought up a good point of nafta. i was critical of it in 1983. it promise to do reduce illegal immigration, it promised to create more jobs on both sides of the border and to raise the wages of mexican workers so they could buy more american products. it promised more political stability, and if you look at the reality in mexico, it's clear that really none of that has happened. and, in fact, not only his the

united states seeing a lot of production shift to china now, so is mexico, because the race to the bottom, you know, has a long way to go, and even in china you're seeing jobs move from the coast to further inland to china and also to other low-cost countries like vietnam. i think a smarter way to do it is not to have trade agreements that are based on a philosophy of tree trade, but to have them based on results. and trade is supposed to be about an even trade. and it's supposed to be about leveling the playing field and allowing both sides to compete fairly. that really hasn't been the case. and if congress and the president wanted to spend time to do something productive, they would focus way more time than they have on china right now, because that's where our biggest trade deficit is. we have a $272 billion trade deficit with china. it's about 80% of our overall trade deficit in manufactured goods, and instead of focusing on smaller free trade

agreements, we really need to fundamentally address this equati equation, because ultimately china is also a strategic competitor, and do we really want to be owing so much money and having so much of our technology transferred to this country where we don't know their intentions in ten or 15 years? >> we have about ten minutes left with our guest, scott paul, the american alliance of manufacturing. he's the executive director there. the web site is americanmanufacturing.org. what will folks find at that web site if they go there? >> they will find a host of information. we have numerous reports. our most recent reports is with auto parts trade with china, which is a very key sector. there is also information about manufacturing statistics for every state in the country, and also it breaks it down to the congressional district level for trade with china and jobs that have impacted by trade with china. and, again, we don't come at this from a partisan perspective. we have industry voices, we have labor voices, we have democrats

and republicans who we're able to work with. so we definitely have a point of view, which is we're pro-manufacturing, but i think it's hard to label us as either a conservative or a progressive because we don't view manufacturing as a partisan issue. >> there is a tweet here. please ask mr. paul who are the major funders of his organization? >> the organization is pretty unique in washington. we are funded through a collective bargaining arrangement between the steel workers union and some of its participating employers. i'll give you a couple of names. united states steel, which has been around for more than 100 years and should be a familiar name. arselar matau, which is a large steel company in the united states that has works in places like cleveland and western indiana but all over the country are just two of them. and we're not a dues-seeking

organization. we actually go out and do a lot of town hall meetings with small and mid-size manufacturers at no cost to them. we've done 35 of these town hall meetings around the country, so we've been able to meet literally hundreds and thousands of workers and small and mid-size manufacturers to hear their points of view about what needs to be done to strengthen our economy. >> next call from trenton in texas. a republican. welcome. >> caller: gentlemen, good morning. i appreciate your made in the usa approach, something we've needed a long time. my question and statement, i guess, in 1999, the cia director under clinton was interviewed, and he had six lawyers on stage with him picking everything he said apart. and this is all he said. he said, i talked to those sheikhs. he said, don't you know we could make a carburetor that gets 500

miles to the gallon? and he said the sheikhs said, you can't do that. we won't make carburator that goes 500 miles per gallon? we need to man up to the debt and do something with it if the representatives and senate was tied to the debt. you know and they lost their paycheck over it, we wouldn't have this debt. i appreciate your hard work. thank you for c-span. >> thank you. >> steven, in terms of the automotive piece of this, i think many people probably find it ironic that a decade ago major car companies tried to kill the electric car. there was a documentary about it. today, they are rushing to embrace it. you have seen a lot of investment in all electric vehicles and renewable fuel vehicles and different fuel

cells. i would quickly add this is a great example of a public/private partnership where both administrations, starting with the bush administration and continued by the obama administration have invested in battery research and loans and grants for companies to explore advanced technologies. it will make us very competitive in the market for years to come. a word about made in america. i think a lot of people are waking up and are saying that they want to see a country that makes things again. we want those things stocked on shelves. you have seen abc news that has been running a series for more than a year now on how americans can buy american. you saw it in president clinton's book about growing jobs. you saw buy american. it shocked me.

he had near liberal policies in his administration. it was terrific to see. you have seen a lot of companies embrace this. chrysler imported from detroit and general electric in talking about jobs in louisville. there has been this new found interest in made in america. you have seen a political response to that. you have seen it on the campaign trail. you have seen it at the super bowl. now we need to do something with it. >> we have herb on the line. a democrat. good morning, herb. >> caller: good morning. mr. paul, let's go back to your comment that china manipulates their currency and, therefore, makes their exports cheaper. let's assume that's true. and, of course, we're interested in the united states in increasing our exports and helping our economy. so, therefore, why don't we in the united states manipulate our

currency as you have charged china does? there must be a down side because we don't do that. what is the down side? >> herb, it is a good question. without getting too deep in monetary policy, let me explain it this way. every day, the central bank in china pbuys and sells the yuan f the value of the yuan to the dollar. you cannot go out and buy yuan. it's very hard for you as a private citizen to do that. it is not really a globally traded currency right now. it is the classic definition of currency manipulation. it is what the central bank in china is able to do. in the united states and every

country is entitled to the monetary policy. the united states has had what we call a strong dollar policy since the clinton administration where that certainly boosts the value of the consumers of the united states. it makes it better for you when you are trying to get a hotel room in paris or something like that because there is a favorable exchange rate. it actually hurts our manufacturers. unless we have a dollar that is valued in a real way, we will be at a slight disadvantage. we have seen a dollar decline against a basket of currencies, slightly. that obviously improves the fortunes of the united states. we have seen administrations going back to the nixon administration and the gold standard and getting the u.s. oft gold standard and the plaza accords intervening to make the dollar more competitive. they have done it in a way where

the dollar can still be traded on the open market. it is not the classic definition which is what china does. they are not supposed to do that under their obligations to the international monetary fund. we have not held them to account yet. >> one last call from laurel, maryland. hi, richard. >> caller: hello. thank you for taking my call. i have an anecdote and also a question. the anecdote is this, i was having chinese food the other day and at the end of the meal, you get the chinese cookie. i looked down on the package and it said "made in the usa." i said what an irony. anyhow, i was in business from

1960 to 1990. 30 years. if ever i was able to get a job big enough, contracted job big enough that i needed 100 people to do this job, and i was able to get 100 people, but eight of them didn't show up, that would be 8%. that's what the unemployment rate is hanging around right about now. my question is, i was always able to get the job done. that little bit of difference was not enough to keep me from getting the job done pretty much on schedule. i'm wondering what in the world are we doing in this country with 8% unemployment and there is no anarchy?

someone is doing something to keep this thing rolling. somebody is making money. where is it? >> thank you. >> just quickly, because talking about our economic vchallenges s an hour-long conversation. it is true the basic unemployment rate is 8.3%. if you add on to that people who have given up looking for jobs and working in jobs part-time who want to be full-time, then the number is closer to 17%. that is pretty significant. you add that a dampening effect on wages. not only for the last couple of years, but the last generation. you have a lot of wealth that has not been going to the american people. i do think that you have seen a bit of an uprising. you have seen it on the right with the tea party. you have seen it on left with occupy wall street and those efforts around the country. there is an incredible amount of

dissatisfaction. that has been born out of 2008 and 2010. we will see it again this fall. until republicans and democrats understand that people want washes to focus on our economy and our jobs, you will continue to see this frustration. it is something that smart political people should pay attention to. >> our guest is scott paul. the web site is americanmanufacturing.org. take a look and learn more about what they are talking about. mr. paul, thank you for your time this morning. >> thank you. a new america where freedom is made real for all. without regard to race or belief or economic condition.

i need a new america which everlastingly attacks the ancient idea that men can solve their differences by killing each other. [ applause ] >> as candidates campaign for president this year, we look back at 14 men who ran for office and lost. go to c-span.org/thecontenders to see the contenders who had a lasting impact on the american politics. >> the liberal left continue to offer only one solution to the problems which confront us. they tell us, again and again and again, we should spend our way out of trouble and spend our way into a better tomorrow. >> c-span.org/thecode