>> thank you. >> thank you, gentlemen. i apologize that our time is so short today. i think we squeezed in at love oterrific information in between the series of votes. i would clearly like to thank our distinguished panel. clearly more and more companies are beginning to rethink their strategies and business plans for the coming years. and i sincerely hope that our subcommittee, working closely together can give them a reason to make "made in america" matter again. i ask unanimous consent to include in the record of the hearing four reports published by mr. giffi's firm on various aspects of manufacturing to which he had referred to in his testimony. i remind members that they have ten business days to submit questions for the record. and i ask the witnesses to please respond promptly to any questions they receive. and with that, the hearing is now adjourned. thank you, gentlemen. >> thank you. c-span's congressional

directory is a complete guide to the 112th congress. you'll find contact information for each member of the house and senate, as well as district maps and committee assignments with more about cabinet members, supreme court justices, and the nation's governors. get your copy for $12.95 plus shipping and handling. order online at c-span.org/shop. in a few moments, steve forbes, president and ceo of forbes talks about the economy and the tax code. in 40 minutes, a hearing looking into a general services administration conference in las vegas. this weekend on book tv on c-span 2, live coverage from "the los angeles times" festival of books. coverage starts at 2:00 p.m. eastern saturday and sunday. saturday at 3:30 p.m., biographers john farrell, jim newton, and richard reeves on clarence darrow, dwight d eisenhower and jfk.

and at 7:30, call in with your questions for steven ross. sunday at 2:00 eastern, watch for eric alterman and his take on liberals and the cause. at 5:00, a panel on surveillance and secrets with laurie andrews. the entire lineup is online at booktv.org. in the new book, rodney king recounts his life following the video recording of his beating by los angeles police in 1991. mr. king recalls the riots following the acquittal of four of the officers in the case and talks about his own legal problems and alcohol addiction. you can see rodney king at the schaumburg center for research in black culture in harlem, new york city, next tuesday at 6:30 p.m. eastern. from the colonial era, prohibition, to today, drinking

for better or worse has always been a part of the american landscape. saturday night, live on american history tv, a history of alcohol in america. watch our simulcast of back story with the american history guys. host ed ayers and brian bellow regular gail with tales of beer and spirits in america, saturday night at 8 eastern, part of american history tv this weekend on c-span 3. steve forbes, the president and ceo of forbes joined us on "washington journal" thursday for a little more than half an hour, focusing on the tax code and the economy. >> now joining us from our new york studio is steve forbes. twice presidential candidate and president and ceo of forbes. mr. forbes, thank you for being on "the washington journal." have you endorsed mitt romney yet? >> i'm endorsing him as the republican nominee.

i had earlier in the campaign endorsed rick perry of texas, governor of texas. he dropped out several months ago. and i said at the time whoever gets the nomination, i would endorse. and then mr. romney is going to be the nominee. so i am backing him 100%, yes. >> what is your enthusiasm level? >> it's picking up. the one good thing about this campaign, even though it looked like it hurt the republican short-term is that i think it made mr. romney a better candidate. he has come out with a very good tax proposal. he has come out with some positive reforms on entitlements. and so i think he is moving in the right direction. a and you got to have positive proposals to go up against the incumbent for the november elections. so he is much better candidate than he was four months ago. i mean, four years ago, and a much better candidate than he was three months ago. and so i'm positive. >> mr. forbes, where do you disagree with president obama on economic matters?

>> well, let's go down the list. first is weak dollar policy, which is devastated this economy, hurt the recovery. the binge spending. you have to ask yourself where does the money come from. it does not come from manna from heaven. it comes from the american people, either through borrowing, taxing, or printing money, which is another form of taxation. his desire to raise taxes, especially on capital, what he has done to health care, i hope the supreme court throws it out. but it would just have a devastating impact on health care in america. so it's a pretty long list. >> what about the congress? what do you think about the republican house particularly? >> well, i think they've made some good attempts to do some positive things, but one thing about government in this country and some of the republicans have been a little frustrated by it is that our founders specifically designed the system

so you don't get great lurches in one direction or another. and so they got control of one house, the house of representatives. i think this november they will get control of the senate and the white house. and then they will have a mandate to do a positive agenda. and i think the american people will be supportive of it. so you have to bring public opinion along. and i think that's what we see unfolding now, reaching a new consensus. >> now in your online magazine, you a new interview you conducted with former president george w. bush. and here is the -- here is the first page of that interview. some of you may gag, but on taxes, trade, and much else, bush 43 has it right is the headline. i want to start with the "some of you may gag" part. why did you include that in there? >> well, president bush, he would be the first to tell you,

still has suffered reputation, especially what happened in 2007/2008. he has always been a controversial figure going back to his election in 2000. so i was just serving it up and saying put aside your personal feelings on some of these issues. he has some very useful and helpful things to say. >> and what about the taxes, the tax cuts of 2001, 2002, 2003? >> well, the powerful ones were 2003. the 2001s were nice, but they're spread over many, many years. so they didn't have much impact. but the tax cuts of 2003 -- 2001 were brought into effect immediately instead of stringing them out. and they worked. the economy revived after the 2001 recession, 2000, 2001 recession. and my only regret was they didn't do more, didn't do more to simplify the tax code. but it was those rates were good.

and i think one of the reasons why we're showing the life we have in the economy today is that those rates were renewed in the december of 2010. and i think there is going to be a lot of debate whether they should be renewed again, at least for a few months, until we can in 2013 get real comprehensive tax simplification and reform. >> steve forbes, i don't know if warren buffett is a friend of yours or not, but have you ever discussed the so-called buffett rule with him? >> i haven't. i've known warren buffett for many years and we are good friends, even if we disagree politically. but i think the so-called buffett rule is one of those things that would do immensely more harm than good. it would raise the capital gains tax to a level we haven't seen since the carter years in the 1970s. and because capital gains are very uncertain, you know, most new businesses don't succeed. it is risk-taking. and if you punish risk-taking,

you're going to get less risk-taking and you're going to get less future prosperity. so even the simply numbers that the so-called buffett rule would raise, i think it was about 4 billion a year each year for ten year, in the real world it would be less. every time we have raised the capital gains tax, we end up losing capital gains revenue, not gaining. so it's one of these things that would destroy capital, reduce risk-taking, and hurt the economy. and i don't think it's going to come to pass. >> steve forbes is our guest. the phone numbers are on the screen. if you would like to dial in and talk with him, you can also send a e-mail to journal@c-span.org, or post a comment on our twitter page. and the first call up for steve forbes comes from joe, a democrat in bethlehem, pennsylvania. hi, joe. >> caller: good morning. good morning, mr. forbes. >> morning, joe. >> caller: i'd like to know why it is that all the time that you conservative republicans never have anything good to say about

what the president's doing or what the democrats are doing. it's only your idea that the conservative republicans are the only ones that are able to try to do anything for the economy, which they never have done anything but say no to everything. and a before you answer that, do you think it's a good idea for some of these conservative republicans like rush limbaugh and this other guy going around threatening to kill the president of the united states? is that a good idea? >> well, rush limbaugh's never threatened to kill the president of the united states. and i don't know who else you're referring to. so let's have the record ermsight on that. of the president's economic policies, if you believe those policies are doing more harm than good, you should say so. this recovery, this economic recovery is just about one of the worst in american history. normally after a sharp downturn, at least initially, you get a sharp upturn in the economy, and then the question becomes can you sustain it. this is one of the worst on

record. and i think the reasons are the weak dollar, the binge spending, massive tax increases, huge regulations, and the uncertainty all of those policies have created. and in terms of positive things, republicans have always positive proposals such as reducing burdens and creating an environment for job creation. and one of the failures of the recent years was that republicans did not advocate a strong and sound dollar. reagan did. bill clinton did. john kennedy did. unfortunately the previous administration did not, and this administration is even worse. so in terms of my own conservatism, if i see republicans doing things wrong, i never hesitate to criticize them. and if democrats do things right, i never hesitate to praise them. i thought bill clinton had it right on the dollar, and said so at the time. >> newville, indiana, jeffrey, republican line, go ahead.

>> caller: good morning. thank you for taking my question. i appreciate it. my question for you is i feel the conservatives in america are basically trying to pay off the credit card so to speak, and the progressives on both sides are basically ringing up the credit card like drunken sailors. are we almost at a saturation point when 49% of the americans at the end of the year don't pay taxes and are believing in an entitlement society? are we really at the precipice of it's going to be too late and turn into a greece, or do we as independents and conservatives getting out the message of fiscal responsibility, are we too late to get the message out? or are we just going to have to wait until this all crumbles apart? because that's really what i feel is happening. and i would appreciate to take your time. >> i think what has happened in western europe and particularly greece, and there are going to be other countries. spain is going through a terrible time, as an object lesson of what happens when you pursue these reckless policies.

and in this country i think the mood has changed. i live in new jersey, a blue state. well have a republican governor, chris christie, but the kratz control the legislature. nonetheless, they were able to bring on budgets that are far lower than they were when christie took office. major reforms in terms of health care policies and pension policies that are wrecking a lot of other municipalities and states. so people of new jersey knew that we could not continue on this path. new york state, democrat governor, got through a budget that was slightly less than a year before. so i think the american people know we cannot continue on this path. and i think there is a consensus. we've got to be -- can't continue this reckless spending. and there are positive reforms of things like social security and a medicare that don't affect those that are on the systems today, but put in positive reforms for people less than the age of 50 or 55 so that they have something there and we don't go broke as we're seeing in western europe.

so yes, i think we are moving in the positive direction. and in terms of taxes, even though they don't call it a tax, working americans do pay payroll taxes in the form of social security and medicare taxes. and so even if you don't end up paying an income tax, you do pay those payroll taxes, not to mention all the state and local taxes you get hit with. and states are very ferocious. the states that have income taxes, i was talking to the governor of maine the other day. the top income tax, state income tax in maine, which was reduced from 8 1/2% to 7.95% hits at an income of a little more than $19,000. so even if you escape the federal income tax, you get slammed on the state level with property taxes, sales taxes, state income taxes. so i think the american people are in a mood for fundamental reform. and that's why i'm optimistic about november. >> steve forbes, senator conrad has been moving a budget in the

senate based on the simpson/bowles debt commission budget. would you have supported that? >> i think there is lot to recommend in simpson-bowles. i wish they had been more aggressive in terms of simplifying the tax code. but they're moving in the right direction. that's why i'm optimistic that come january, there are a lot of democrats. simpson/bowles, bowles is a democrat, worked very closely with bill clinton. and democrats on that commission, many of them signed on to the idea of simplifying the code, positive reforms on entitlements. so it's been the white house to be blunt that has blocked agreements on these things. so i think come january, you are going to find not only republicans, but a lot of democrats are going to say we've got to make some changes. and so i think a new consensus is emerging that will be good for this country. >> mr. forbes, there is a social

media program called tout that we're starting to used on "the washington journal." you can send in a short video. we advertised the fact that you were going to be on the program today. we got some responses to that. and here is a tout video from sam anderson. >> my question for mr. forbes is which presidential candidate do you feel has the best plan and the best chance to fix the united states economy right now? >> steve forbes? >> yes, good fundamental question. i think of the two major candidates, mitt romney and president obama, i think mitt romney by far has the best plans. he's got a tax proposal plan to reduce tax rates and simplify the code. again, not as far as i'd like to go, but moving profoundly in the right direction. very, very positive tax plan. he knows the need for reducing spending and reforming health care in positive ways. so, yes, i think governor romney

has a much better proposals for getting this economy back on its feet, which is why i think come november, even though it's going to be a tough, nasty campaign, i think he will triumph, and that consensus will be there to get real things done come january. >> do you think there is an opportunity to reform the tax code? you've been talking about that for years. >> i think the answer is yes. and taking the simpson/bowles commission, democrats signed on to the idea of reducing loopholes and reducing tax rates across the board. they didn't endorse a flat tax, which is what i'm in favor of. but they did buy into the concept. back in the 1980s, 1986, we saw a consensus emerge on simplifying the code. democrats signed on to it, including the chairman of the ways and means committee, who was a democrat at the time. they reduced a lot of tax shelters from the tax code and reduced the number of tax

brackets from six i think down to two, and two rates, 28% and 15%. and that passed with overwhelming bipartisan support. they cleaned up the code. somewhat cleaned up the code, reduced rates, and simplified the number of tax brackets, and it was a good reform bill. i think you can achieve that kind of consensus next year. and i think simpson/bowles is a symptom you might say or a proof positive that a lot of democrats know this has to be done. in '86, democrats got to clean out a lot of the loopholes. and i think we'll do it again in 2013, reduce tax rates, and i think you'll get a bipartisan bill on it. >> steve forbes is our guest. and by the way, we'll be using tout throughout "the washington journal" in the upcoming weeks and months. if you would like to at least see what it's like, go to

tout.com/c-span wj. clearwater, florida, stella on our independent line. hi. >> caller: hello and thank you for taking my call. i'm an independent. and, you know, i think politicians ought to be given a lie detector test before they go and take duty. they spend too much, et cetera. but i think if obama gets elected again, not only myself but a lot of people are leaving the united states. because he has, you know -- a lot of people think they can just stick their hand out and get -- that the government is supposed to support them. and then where does the money come from? our taxes. i'd like to say this so people like that other guy that was saying republicans are all against democrats, so he understands, let's say he has a business and he's got $100 for budget. 25 are for operational costs. 25 are for supplies.

25 are for salaries. and 25 are for taxes. now if they increase the taxes, to let's say $40, what do they have to do? cut jobs, cut this, cut that. and people unfortunately do not understand this. and they're 65 to 67% of the population because they have a high school or less education and then there are different levels of degrees of intelligence quotients. >> all right, stella, i think we got your point. steve forbes, what response do you have for her? >> well, stella makes in terms of small businesses, makes a very good point. small businesses, many of them have very small margins. and they spend a lot of time, unnecessary time every quarter filling out tax forms, bringing the bookkeeper in, trying to make sure they're not running afoul of regulations and lawsuits and the like. and it makes it very difficult to succeed. and if you raise, for example,

the buffett rule, or what president obama's proposed, if you have 200, $250,000 of income, that hits not only individuals, it hits small businesses, especially businesses that have 25, to 50, 60 employees. they fall in that bracket. and so their effective tax rate is going to go up. which means if they survive, they're going to be doing less hiring, less investing. and you take the restaurant industry, which is by nature has a very high casualty rate. i've talked to restaurateurs who say obamacare as it's now written, at least as much as we can figure out what is in that thing are going to be crushed by the cost of the rules and the money they're going to have to lay out. and that again is going to hurt job creation. so the massive uncertainty that we see here is hurting especially small businesses that don't have big tax departments and legal departments. and they're the ones as we know that create most of the new jobs in this economy.

>> james tweets in to you, mr. forbes, a billionaire wanting a flat tax, what a joke. >> well, put me aside from it. if you want to have me stay with the old code, go right ahead. you can carve out an exemption for me or for a handful of other people. but in terms of simplifying the tax code, the tax code today is one of the biggest sources of political corruption and weight on this economy. just to put it in perspective, lincoln's gettysburg address is 272 words. decoration of independence, 1500 words. the constitution, all the amendment, a little more than 7,000 words. the bible 773,000 words. the federal income tax words, 9 million words and rising. and nobody knows what is in that thing. the virtue of the flat tax is if you make it, you pay it. you worry about companies not paying their taxes. under the flat tax, if they make the money, they pay it. you can't hide anymore.

in that sense you get more compliance. you have low rates so you encourage things like risk-taking and reward success, so you'll get more of those good things. it's good all the way around. don't personalize the thing. ask what is best for america. what is best for cleaning up this horrific political system we have, where half the lobbying in washington revolves around this corrupt tax code. let's throw it out, start over with something that people can actually understand. >> brenda is a democrat in bremerton, washington. brenda, you're on with steve forbes. please go ahead. >> caller: wow, thank you. mr. forbes, you indicated in your opening statement that you think that the house is going to retain -- excuse me, that you're going to retain the house, gain the senate and the white house so that you can have your mandate. i would like you to address the fact that there was a mandate in 2008 that was when the president did not accomplish his goals for the will of the people because of the off the chart record filibusters and the fact that i

want everyone out to hear the democrats never had 60. lieberman was a part of that. lieberman campaigned for the other candidate. so i don't want to hear that you could have gotten everything you wanted because you had 60 votes. we never had 60 votes. i recognize also some democrats in the senate do vote differently, but that's because we're a much more broad-based party with more open mind and more open ideas. but, again, to speak about a mandate, because i know republicans are very strong in message, democrats really stink at message. republicans are very strong, lockstep in their message. and again, the record filibusters. you can't have it both ways. you can't say we're the minority. we have to protect the minority. we're the majority, we get everything we want. >> mr. forbes? >> well, in terms of 2008, joe lieberman may have liked john mccain, but he did not endorse john mccain. and when he caucused, he

caucused with the democrats, and the democrats welcomed him back into the fold. and he voted for president obama's health care bill. and so in terms of the health care bill, even though the american people poll showed it was very unpopular, he got it through. and he got through his massive spending increases. he got through dodd-frank. so on a lot of big things, he got his mandate through. and it was repudiated in the elections of 2010. and in terms of 2013, there is no way republicans are going to have a filibuster-proof majority in the united states senate. unless there is a huge blowout. and i don't foresee that. however, i think that because there is an emerging consensus, and you saw this with simpson/bowles commission and other signs of it, there are a lot of democrats who know that medicare and social security for younger people are headed for off the cliff. they know we cannot continue this massive debt and binge spending. let's look at western europe,

where that's leading. and so i think you will get a consensus. so even though the gop won't have anywhere near 60 members of the senate, there will be a lot of democrats in favor of positive reforms, just as we saw in the state of new jersey. chris christie could say anything he wants. but if the democrats didn't go along with him in the legislature, it would not have become law. and he achieved a lot of positive things precisely because a lot of democrats said we've got to make positive changes. we've got to do these things. and they did and a consensus was reached. i think we're in the process of doing that nationwide. >> zoe e-mails into you, mr. forbes, since you don't like obama's health care plan, what do you think we should do to make health care affordable and accessible to everyone, including those with preexisting conditions? she adds no vague answers allowed. >> okay. we'll probably take up the rest of the show on it. but specifically what you want broadly first is you want to

have more free markets in health care and more effective safety nets. and compare it to food. if people have trouble getting food in this country, you don't have the government take over agriculture. russia and china tried that with disastrous results. so you allow farmers to grow the food. companies process the food. truckers deliver the food to grocery stores and everyone sell the food. and if people have problem getting food, you have everything from food banks to food stamps to deal with that. why in the world can't we do that in health care? have the patient in control instead of third parties, a more effective safety nets where they have the equivalent of health vouchers and the like so people get minimum care and shore up the safety net system instead of having to go to the emergency room. a couple positive reforms. how about nationwide shopping for health insurance. right now if you live in a state, each state restricts how many companies can compete for your business. i live in new jersey. i can get a perfectly good

health policy in pennsylvania, but it's illegal for me to buy it. i can buy a house in pennsylvania. so why not nationwide shopping so you have hundreds of companies vying for your business. how about equal tax treatment? if you're a company, you get a tax deduction. if you're self-employed, you get a tax deduction. but if you're an individual that doesn't like the plan being offered by your employer and you want to buy a plan in the marketplace, you have to pay for it with after-tax dollars. that's not right. so there are positive reforms that can be done. shore up the safety net system, just as we've done with food. have more patient control of health care. and get the kind of productivity and cost reductions and increase in the supply of health care that we do everywhere else in this economy. so no, we cannot continue with the status quo. more government control is not the right answer. more free markets and effective safety nets instead of the hodgepodge we have today. we can do it. we did it in food. we can do it in health care. >> the labor department is just reporting on unemployment

applications. the number of people seeking u.s. unemployment benefits dipped last week, but remained higher than it's been in recent weeks. the slight rise in applications in the past few weeks could signal that the gains in the job market are uneven. that's the associated press reporting that. another e-mail for you, mr. forbes. this is from maurice. would you accept position as vice president? what position in romney administration would you accept? >> i'm not going to get offered the vice presidency. there are a lot of good people out there like bobby jindal in louisiana, marco rubio in florida, rob portman, senator from ohio, our governor, chris christie, numerous ones they'll look at for vp. in terms of anything in the romney administration, i don't think i'll get offered a job. i didn't back him early. but i'll certainly support the positive policies that he puts forth. and if i think there is something wrong with any of the