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 straight on that. on your point in terms 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 policies, that's the nice thing of being an agitator. i have the freedom to criticize and say you can make these things better. but for vp, no. if you want to lose money, bet on me for that one. >> maurice goes on to ask, what are the causes of high gas prices, and how can we remedy them? >> well, the biggest cause, and

unfortunately this is the most boring topic in the world, monetary policy. the biggest cause of high gasoline prices, high oil prices is the cheap dollar. we should have learned this from the 1970s. when you trash the u.s. dollar by printing too many dollars as the federal reserve has been doing on and off for ten years now. it started under the bush administrations, continued with vengeance under the obama administration, you get higher commodity prices. you see it in the gold prices. you see it in oil prices. in the 1970s, oil went from $3 a barrel to $40 a barrel because of printing so many dollars. and when reagan finally stopped that in the early '80s, oil went from $40 and stabilized to 20 where it remained until the fed went on this binge again ten years ago. so now it's gone from 20 to $100 a barrel. so a, number one, have a strong and stable dollar.

john kerry sa john kennedy said the dollar should be good as gold. clinton understood it. we have a lot of unexplored availability of gas and oil in alaska, offshore, onshore with the natural gas. we're having a huge natural gas boom. so if we don't put unnecessary barriers in the way, within less than a decade, for the first time since the 1960s, this country is going to be a net energy exporter. it's phenomenal. huge turn because of technological breakthroughs in drilling for natural gas and also coming with oil. more and more oil as well. >> just a few minutes left with our guest, steve forbes, who joins us from our new york studio. richard is a republican in middletown, new york. >> caller: yes, mr. forbes. a little over a month ago you talked on this show.

and one caller asked the candidate with the best plan. only another candidate ron paul, you said to me that you liked ron paul's ideas, but not all of them. but he is the only one with a plan. he is the only one that beats obama. in the polls there, even though romney comes up even, ron paul wins. i mean he had 8500 people at ucla with people hanging out of trees, i called it the tree of liberty. but now we've got these things like comprehensive annual financial reports, which is really like a double set of books. you can have a budget. but unless they look at the assets of the municipalities -- >> all right, you know, richard? we got the point about ron paul. steve forbes, your views on ron paul. >> well, in terms of the race of the 33 contests we've had, states, primaries, and caucuses, while we had a lot of

enthusiastic supporters, he didn't win one of those contests. and so he is nowhere as near to getting the nomination. what i like about ron paul is his views on the dollar. he is the one candidate who has some comprehension of this boring subject, but critical subject of the dollar and monetary policy. and so rather than run for president, i think he should run for chairman of the fed and i would gladly support him for that. he is one candidate who understands when you trash your money, we pay a huge price for it in breaking down the social order, reducing standard of living, reducing real wages in this country. that's something he profoundly gets. and i hope governor romney and others pay more attention to ron paul on that critical subject. >> tommy tweets in to you, mr. forbes, what do you think the real employment situation is? and will the representative ryan plan help the overall economy?

>> in terms of employment, i think the american people now understand that the unemployment rate in and of itself hardly gives you a complete picture. a lot of people have jobs that they take because they have no other choice. a lot of people are working part-time would like to work full-time. and a lot of people discouraged, have dropped out of the labor market. so the situation, even though we've had some gains in recent months is nowhere near what we need to do to get a really good employment picture in this country. in terms of representative paul ryan's plans, i think they are positive. tax simplification, he would have two rates instead of one. 25% and 10%, which i think would be a huge improvement over what we have today. i mean he's got very positive proposals on medicare and social security. and, again, the emphasis is for people who are on medicare and social security and are about to

go on it in the next five to seven years, ten years, you're not affected by his reforms. it's only people who are younger. and since the systems, democrats off the record, most of them will tell you, especially those who served on simpson/bowles will tell you the two systems, medicare and social security are not going to work for younger people. so while we still have time, make reforms now so that younger people have something when they become of age. so it's a positive approach. don't take away anything from people who are on those systems today, but put in new systems that give something to younger people. so i think he'll clarify the rules which will help job creation. and with the more vibrant economy, that's the only way to get resources to meet commitments in the future. >> derek, independent line, you're on the line with steve forbes. >> caller: good morning. >> morning.

>> caller: you are the man. i've watched you on fox business on saturday. i saw you run for president. i wish you would have switched to the republican party because obviously they aren't very conservative, as we all know at this point in the fiscal management of our country. now my question is this. do we need more cpas than lawyers as our representatives? a. b, why do are they talking percentages? mitt romney paid what, $3 million in taxes? $3 million in taxes is what may be 5% over a lifetime paid. why are they talking percentages? where is the logic? >> well, in terms of cpas and the like, i'm not so concerned with what the profession is if they understand, actually understand incentives, positive incentives, free markets enable people to enjoy a higher standard of living as lincoln put it, and improve their lot in life. so if they get it, i don't care what their profession is.

and in terms of republicans, a lot of republicans have not behaved very well fiscally. and that's one reason why the tea party rose up. and a lot of those republicans did not win their primaries. and you're seeing some of that play out this year as well. so i think, again, the bottom line is the american people are ahead of a lot of their political leaders in knowing that things have to be done. and it's not austerity in terms of throwing grandma off the cliff or any kind of that nonsense. what it is, if you do positive things now, you're going to have a much better future and a more prosperous future and will avoid the horrors that are unfolding in greece and the rest of western europe. we don't have to go down that path. >> we have time for lisa in sacramento, california, a democrat. lisa, we have about 30 seconds. >> caller: oh, good morning. peter mr. forbes. i just have three questions. one of them you already

answered. he says he don't support affordable health care with obama, but obama adopted it from romney. second thing, you say you support the paul ryan budget. and the third thing is how do you start a business when you're unemployed and have no money? thank you. and you have is a wonderful day. >> mr. forbes, we have about 30 seconds. if you can take that third question on starting a business since we've discussed the other two. >> very quickly, if you have an idea for a product or a service, a lot of people have started a business just by producing that product and then going to friends or family and start raising money. you can even go, even though i'm not a big government guy, you can go to the sba, small business administration and see if you can persuade them or others and start bootstrapping capital. and a lot of people are able to do it just with an idea going out there. they don't have to have a lot of capital at the beginning. and the key thing is you come up with something,