host: surprising many people. the unemployment rate dropped to 3.4%. a low not seen since 1969. what does this mean for main street america with inflation still high in the federal reserve thinking about raising interest rates again? what this unemployment and inflation news but we want to

know what things look like for you. tell us what you are a top economic concerns are this morning. if you make under $50,000 call in on 202-748-8000. if you make between 50000 and $80,000 your line is 202-748-8001. if you make over $80,000 your line is going to be 202-748-8002 . you could always texas -- text us at 202-748-8003. and we are already -- always reading on social media @cspanwj . this morning we are talking about the new jobs report in your top economic concerns.

on friday the report came out talking about unemployment and inflation rate. the wall street journal where they talk about the number of jobs added. here is what the wall street journal has to say. u.s. job growth accelerated at the start of the year as employers added 517,000 jobs and place the unemployment rate to a 53 year low. the gains raise questions about whether the economy which has been losing momentum the past several months starting to become see him again -- steam again and could prompt more aggressive response from the federal reserve to timber economic growth and bring on inflation. the gains were the largest since july 2022.

december job growth was also stronger than estimated posting the average job gain for the last three months to 356,000 well above the 2019 pre-pandemic average of a hundred 63,000 -- 163,000. the unemployment rate was the lowest level since 1989. reversing the declines in the fourth quarter. that's from the wall street journal this morning. talking about the fallen unemployment rate. congressional democrats and president joe biden arts housing this new jobs report -- are talking this new jobs report success of the new economic plan. pres. biden: next week i'll be reporting on the state of the union, but today i'm happy to

report the state of the union and the state of our economy is strong. we learned this morning that the economy has created 517,000 jobs this last month. more than half a million jobs in the month of january. we also learned that half a million more jobs created last year than we thought. at the all up amy's we created 12 million -- add that all up and we have created 12 million jobs subject -- this i took office. that's the strongest two years in history. as my daddy's essay, job is a blot -- as my dad used to say jobs is about more than a paycheck it is about your dignity. now you can provide for your family with dignity and

self-worth. on the plummet rate fell to 3.4% -- unemployment rate fell to 3.4 percent below is in 54 years. the last time it was that low was may 1969. host: the democrats touting this new job report as proof that there economic plans are working for america. as you can see, the unemployment rate was 3.4% and 517,000 jobs added. if you look at the numbers more closely, the numbers are from the labor statistics, we see a big jump leisure and hospitality. these are the jobs that were affected the most by the pandemic. those numbers jump hundred 28,000. next active professional

business service affected by the pandemic it jumped 82,000. government jobs jumped 74,000. health care for the 8000 and down from there. -- health care 58000 and down from there. these are the one-month job changes that came out on friday. the number surprise people but we want to know are you been affected by these changes? what are you seeing out there? what does the job market look like for you? are you getting raises? are you trying to find a higher raising job? if you like -- make less than $50,000, 202-748-8000. between $50,000 and $80,000, 202-748-8001. over $80,000 202-748-8002. let's start with even -- stephen

from georgia. caller: good morning. i am calling about minimum wage. i think it should be higher. i work at walmart. it is just $14. i think it should be higher than that. host: what eating the minimum wage should be? caller: between $16 and $17 right now to knock off inflation. host: how much would a raise from the current wage to $17 with me to average americans? host: quite a lot. it keeps going up, inflation. groceries to housing at the corners. wages should be going to. host: you said you work in

walmart. there is a story they came out in npr earlier this week. with this shopping at one walmart and they said the prices went up 20% on average since mid-2019. this was a woman in georgia in liberty county south of savannah -- walmart in georgia in liberty county south of savannah. have you seen everyday items go up as working at walmart? caller: yes. a lot. some people go to dollar general to go get supplies. everything is still going up. host: a customer say things to people like you about how

expensive things are getting? caller: yes. every day. what is the kind of stuff you are hearing? caller: sodas, cleaning supplies, and everything still going to. everything they by now they have a calculator. i have seen people put stuff back on the shelf. host: what do you think the government should do? you said raise the minimum wage. is there anything else the federal government or state government should be doing right now to make things easier on americans? caller: yes. i think that the solution

minimum wage to go against inflation. host: let's go to steve in florida. good morning. caller: good morning. thank you for taking my call. my top economic concern is private equity firms taking over corporations that employ people that provide health care. this is a problem that i think we all know someone who is a friend or a member of the family that has been negatively impacted by this. the economic problems are that no one can afford to purchase a house anymore. the median house price in florida -- we all have loved ones in long-term care

facilities. private equity firms love to buy these facilities out the have elderly people that need care. once they by the amount, they lay off half of the staff. the women the features these facilities previously offered, and they make it so they health care is inadequate and private equity firms they will go into a region and start building houses and raise the price of the median house $50,000. these private equity firms make it so you cannot afford a house that loved ones cannot get care. they lay off half of the staff.

you need to go look for another job. i know a lot of jobs have been created but i think that the government needs to revisit this entries thus enters kerry for law. host: -- revisit this entries carryforward law. host: some people would say it is capitalism and equity firms are trying to make a dollar. how far should the government go interfering in the private capitalist market? caller: i'm glad you asked that. this is shareholder base capitalism. this is something that has been impacting our economy since the reagan administration.

but this is doing is creating a billionaire class. there's free market, free enterprise for a company will start produce a product or service for profit. that is good because it employs people. shareholder base capitalism is like the anti-free enterprise approach to capitalism. what the government needs to do, there's a law called the interest carryforward law, a tax law the government needs to revisit. i think there is a big difference between capitalism and shareholder base capitalism. host: francis in montana. good morning. what is economic concern? caller: good morning.

the biggest concern i see on a economy basis is two fold. the debt now at $31.5 trillion and counting with the declining gross domestic product. the declining gdp outclasses and much more important than what we hear on talking points about more education -- more employment and lower inflation. that is a bunch of bs. the declining gdp is the only way to take care of our feature and pay off that debt or manage it is by potential increase in gross domestic product. that's going to take a significant policy changes to bring in and grow the economy. we need more electricity to do manufacturing.

we need a lot more freshwater to take care of economic factor that is agricultural sector that needs improvement. we need to train our workforce and bring in immigration that is qualified to enter our workforce because we need more mollified workers to take care -- qualified workers to take care of a growing economy. i am 81 years old and i've been around the world many times and i understand worldwide economics as well as federal economics. host: tell us concrete steps that if you are in charge of congress in the white house, he would have the federal government do right now to address the debt and gdp. what should they be doing? host: -- caller: they need to allow significant improvements

in production of electricity that will attract and out manage future manufacturing capacity. to do that, we need to bring in nuclear energy and desalinization plants and much more use of clean fossil fuels. this use of clean energy stuff they are talking about that as many years down the road. that's my opinion and my reading. i'm a forensic investigator. i analyze these carefully and look back. host: how does that address the debt? caller: if you grow the economy, and reduce inflation, we can start whittling down the debt or manage the service of it. it is going to take a huge increase in gdp to recover $31.5 trillion. host: doesn't the investment in

the nuclear energy and donis -- add to the debt? caller: no. that should be done by the private sector. the private sector needs to be incentive to make those investments. host: this is not a government program. this is a private program. caller: as a government policy program i am talking about that will give the free enterprise system and operation chance to operate effectively. host: let's go to john calling from florida. the morning. -- good morning. caller: good morning. i did not know the first two caller's response be economic as but i will give you some facts. i moved from massachusetts to florida. i made over a $100,000 and that

of the trump administration when gas was $1.15 i could hire more people, get more material and things my company. since the pandemic, i here in florida, i make over $80,000. i went food shopping for me and my wife. $300 last night. we barely got anything. that is rural america. -- that is real america. i am filling up my pickup truck for $3.60. i do not know where this biden boom is. this is real america. host: what type of business are you running? caller: a construction business in massachusetts. i made over a $100,000 in massachusetts but i'm a supervisor here in florida.

i make over $80,000. with rent, utility, cable, phone bill, we barely get by. i know what america is thinking. everything is more expensive and it all comes from fuel. i do not know where this biden boom is and if you notice on your chart, we only hired 25,000 construction workers because we cannot get any kids to get into the trays and that is where our problem is. to get the gdp you have to close the border, bring taxes down and produce fuel domestically. there is not a call as i call you this morning -- a caller that can call you this morning and disagree. i buy my groceries under the trump administration. may my wife laughed. look at the bill it is $300.

we just got let, tomatoes, basic items. host: what stores are you shopping in? grocery store? hopeless? -- whole foods? caller: sometimes you have to go to the dollar general and it is still expensive. i make almost $80,000. do you think i can buy a house like my father? my father went about a house and provided for us. those days are over. joe can say all he wants about kitchen table items but he destroyed the economy. the reason why these jobs are coming back is covid wipe everything out. i am 43 years old. i am america. i'm trying to raise a family.

we are trying to have a kid and we cannot get by on $80,000. that israel life -- is real life. host: speaker mccarthy came out about the discussion he plans to have with president biden about government spending and raising the debt ceiling. here's a portion of what he had to say on thursday. [video clip] >> the president is open to talking about the debt ceiling in a separate discussion. what you think to separate those two? >> when they want to talk about it, we will not pass a clean debt selling care without some form of spending reform so there never be a clean one. at the end of the day, we are going to get spending reform. you have to let the debt selling but you do not do it without change your behavior. host: let's see what our

followers on social media are saying about their top economic concerns right now. here is one tweet that says there's quite a stark difference in bls numbers and the adp numbers may wait until next month to see what adjustment bls make. here's another tweet that says, millions of immigrants pressing in to our country and dropping out wages for our low-wage workers. another tweet, sounds like biden is not doing such a bad job after all. another tweet, we do not live paycheck-to-paycheck our budget to budget so we have little economic concerns. what a your top economic concerns are if you make under $50,000, 202-748-8000. between $50,000 in $80,000, 202-748-8001.

if you make more than $80,000 202-748-8002. we want to know what your top economic concern is right now. let's go back to our phone lines. melissa from indiana. caller: good morning. i have several concerns. my first one is profit over people seems to be the mantra. my mother is on social security that's i took her to kroger to buy groceries and that was jaw-dropping. i would not let her bite most of everything and i probably buy most of our groceries. i do not know how people can make it. it is sad. look at the cost of a loaf of bread compared to a gallon of gas, that is opportunism at the pandemic. this is not joe biden's fault. we had a pandemic and we are getting out of bed.

we have opportunism right now. we currently do not have a speaker of the house that i think is going to be able to do anything effective in congress. i hope the best. i hope our next two years are easier than it seems but we need to put control on appropriations. host: what do you think the government should do? what is concrete steps congress and the white house should take right now? caller: i think that we have a voter class and a donor class. the need to work with her voter class and other donor class. i'm tired of the donor class getting -- they are getting all of what they want and the voters are not getting anything they need. the voters need to be very angry. i was so upset in kroger i did not believe -- i talk about baking bread for my mom and i

have three people come up to me and say let me know when you're going to start. i buy it from you. that is terrible in america. i'm speechless. more people should be upset. why aren't more people upset? citizens united is probably the worst thing ever. i did not vote for a person who then stands up for a corporation, especially the nra. these people used to teach a hunter safety. what happened to that? they have sold their souls. host: daniel calling from new york. good morning. caller: good morning. excellent points everybody is making. i have six points i want to make. i went to law for nine years. i retired. i do my own analysis. people mention inflation which

is a horrible tax, it is not called a tykes but it is. inflation is averaged 1.5% the last six months. federal reserve chairperson said he wants inflation at 2.0% or he will keep raising the rates. it has been 1.5% the last six months but if i give you the past 12 months it is 5.7%. we are misled or yet we are misinformed. december 2 021 we had disinflation of 0.1%. in january i expect inflation again. the prices of goods starting to go down. red meat started to go down. all you're down. that is the -- oil going down. the second point is the bible --

biden boom. we are at 11 point -- 7 million jobs in 25 months, we have never seen anything like that. prospective. bill clinton created 211,000 jobs per month in four years. reagan won 70,000 jobs created per month. those of the three great job creators. with 237,000. biden 459,000 jobs being created per month. why should the government do? -- what should the government do? the democrats are doing with the

government should do. put people to work. get they wages to increase. steve ratner i'm surprised he is not fired. the reason the fed is raising is because the rates are working americans are going up to best. -- too fast. american workers are getting paid more. we are going to raise the rate because american workers are getting paid more. that's how crazy things are getting. he said the white part out loud. some people say wonderful under trump. trump -67,000 jobs created per month.

we lost over 3 million jobs after four years. by the time trump was voted out. we added 7.8 trillion skew national debt in four years, which is 25% of our total national debt. he bankrupt the casino. if you have four more years he would have bankrupt the united states. host: been in nevada. good morning. caller: good morning. i want to start by saying i work at university so that allows me a level of job security and economic stability that might not be available to a lot of

other people in the workforce. i understand that and i'm thankful for how fortunate i am. i've been ok to the unfortunate economic woes of the past several years. over the past several years i've received two promotions. unfortunately with the state of the economy and living as well as i did make it 2019. i make slightly more financially comfortable in between 19. -- 2019. the colors cape who said about the biden boom -- the caller who said about the biden boom, i'm not saying they are wrong but i'm having trouble the biden administration come to the podium and helped the strong economy. i comfortable, i'm not seeing it.

host: explain to our viewers -- the numbers where you say you made it $20,000 less in 2019 but you were five -- financially better off. caller: i had more money in my checking account at the end of the month. when food because three times as much. when a gas cause -- when gas cost three times as much that is the only way i can think to explain it. host: what do you think the government should do to reverse inflation? make people's paychecks go further? caller: i am not an economist. artist and in theory raising interest rates should bring down inflation but it brings its own set of problems. i did not foresee being able to buy a car in the next four or five years i'm hoping the car i have hangs on because i cannot afford a loan with interest rate

they are let alone as they go up -- if they go up. host: president biden came out on friday and he was asked if he takes his possibility for rising consumer prices, which you have heard from our colleagues this morning. here's what he said on friday. [video clip] pres. biden: let's take blame for inflation? no. it was already there when i got here. remember what the economy was like when i got here? jobs to measuring. inflation rising. we were not manufacturing a dam thing here and were an economic difficulty. host: here are some tweets from lawmakers about the new jobs report and how they see it affecting the american economy. chuck schumer, jobs jobs jobs. inflation is slowing.

democrats keep delivering for the american people. >> good news unemployment dropped to the lowest level in 53 years with over 50,000 jobs -- 500,000 jobs added last month. house minority leader hakeem jeffries says, the biden economy shattered expectations and created more than 50,000 -- 500,000 jobs last month they continue to get stuff done. former speaker pelosi says, america created 517,000 new jobs in january. a victory for our middle class and further proof that post is economic plan is working. we have added 12 million jobs and achieved those on the permit rate since 1969 -- the lowest

unemployment rate since 1969. is your paycheck going further? are you looking for a job? we want to know what your top economic concern is. carol from new york. good morning. caller: hi. i would like to complain. i'm 70 years old. i was 69 years old when i went back to work. i'm a registered nurse with a four year degree. my daughter died four years ago. my husband died 40 years ago. i did not get any pension or anything else. nursing does not give you pensions and medical insurance and all of this, you wait 10 weeks for a paycheck. march 31 make $49 an hour. april 1 new york state job small salary down to $30 an hour.

no holidays, no vacations, no benefits. i wait 10 weeks for a paycheck. i have a disabled grandchild so unfortunately i'm taking my whole social security check to pay for her. people are getting benefits. they are getting paychecks but no benefits. my sister worked for a group home for 27 years. no benefits. they cut out the benefits. she has worked for a group home for 27 years. nursing gets nothing. they would not do that to teachers. there when i do that to our police department but they can cut nursing salary by $49 an hour to $30 an hour to take care of quadriplegic on ventilators. host: do you think the state

government or the federal government should interfere in race the race back up? caller: should not have been interfered to start with. they should've of my paycheck as it was at $49. they had no right to work -- knock it down to $30 an hour with no benefit, no holidays, 10 weeks per paycheck. these companies are knocking out the medical benefits. there are knocking out holidays and vacations. how do you live from the holidays and vacations? host: i have a couple of relatives who are nurses who are saying the same thing you are. the question becomes, why stay in the industry? caller: i have been in the industry for 40 years. host: do you are stuck?

-- do you feel you are stuck? caller: no. i cannot find another job for $49 an hour. certainly. how much is a teacher make a our -- an hour? how much is a police officer making an hour? what benefits are they getting? when they retire what are the benefits they are getting? i do not get a penny. i'm 70 years old and have to go back to work to be able to support my granddaughter because her mother just died. her father just died. i have never received a dime. i work 16 hours a day seven days a week my whole life. is that there -- fair? host: republicans have been saying the job growth numbers

are good but they did not think the biden administration economic plan is going to work for america. here's a statement from jason smith from missouri. he says any job growth is good news. laboe participation below pre-pandemic levels and do by democrats deficitighed spending triggering a cycle of historic inflation leading to ever higher interest rates. democrats war on work mates sitting atand collecting a chk re probable than getting a jo better policies are needed for a stronger job and wage growth. house ways and means chair jason smith. let us know what your top economic concern is. plan -- flynn from georgia. caller: good morning.

i'm calling about a few things. when mr. trump was in charge, my gas price was a dollar $.70 in augusta, georgia versus $3.55 today. my utility bills, i could afford it. lately my utility bills went up 10% when mr. biden said syntaxes on us -- syntax on us. it is an increase for us. host: how does president biden raise taxes on your utility bill? caller: it went up because of what they are doing with this greenville to charge -- green deal to charge extra to us. host: that never pass congress.

it cannot be the new green because it never passed. caller: my bill went up 10%. my bill went up 10%. my health care went up. foods, eggs, i know somebody said the birds flew, five dozen eggs use the cost $7.19 and are $19 today. you go to any store between sam's club, costco, everything is up. chicken wings you cannot touch them because they cost more than the shrimp now. my wife is working two jobs. i work one job. they are cutting our hours. i worked for a big company. they are laying off 10% of the workforce. we are talking about 12,000 people losing their job because

some problems. people say the economy is doing well. look at it, big tech there cutting off. companies laying off people. they say begun increase of 517,000 jobs but some people have two or three jobs. this is why. i had to get a second job because i cannot make it. i used to be comfortable during the trump but now with biden. i cannot get a loan. i have an imminent domain plumbing -- coming and i cannot go buy a house because interest rates are up to 6.1%. it is still increase. why mr. biden said everything

grows and inflation is going down but it was not for the interest rate increase, the increases is going to be around 12%. this is what i do not follow. why is he talking about an interest rate? host: he brought up a question we want to answer for y'all. a lot of people have noted increase in the price of eggs. new york times have a story about what is going on with the price. prices have driven -- risen for everything over the past couple of years but anyway shopping for groceries recently have noticed because of one item, eggs. buying them has become expensive. in december of 2022 the average price of a dozen eggs was $4.25.

more than twice what they calls a year earlier. combination in backers is at work. inflation has a more long term impact on goods others like the outbreak of the avian flu are specific to eggs and poultry. the price of eggs are more than twice what they calls a year earlier at $4.25. is this your top economic concern? we want to know what your top economic concern is. lester in oregon. good morning. caller: the morning. my family was raised in vons. the price of beef is going to go up.

the price of eggs we are ok on. the price of fuel in oregon started to rise again. we went from six dollars a gallon and i think what is going on is the reason why we have jobs created as the benefits are being taken away. by taking the benefits away where pay people more for people to work more. i work for school district and retired from the school district. custodial filled. my concern is the more prices of meat going up, these are people that are not -- ok, but the

price of food going up in oregon is because it should be in the fuel and when you go to oregon diesel six dollars a gallon. that is because of our issue in oregon right now -- a lots of our issue in oregon right now. it is going solely and the more we have this person as our president it is going to put us in a funk that is called depression. like my parents said during world war ii, they did not have anything. that is what we are falling into right now. host: newsweek has a story about why gas prices are going up right now.

last week the national average price for regular gas crept up to $3.51 a gallon, according to the american automobile association. jumping up $.12 compared to a week before and $.41 in december as of today regular gas was $3.49 a gallon. it was a dark surprise for megan consumers worry of the prices last summer when gas reached or if your height -- a record high. why is pricing shooting up? a weaker dollar help push prices higher, but china's reopening is playing a factor. the chief oil analyst for the agency service tells newsweek. the thought is that increase activity from china whether it is air travel, spending or more

driving is going to impact global oil demand. this is still a global market. opec plus is also sticking the plans for production levels to normal oil coming from that group. they're not cutting more. another factor contributed to the increase in gas prices is the extreme weather that hit the country at the end of last year which cause outages at refineries and left many working at less than full capacity. newsweek on why gas prices are going up right now. bikes smartphone lies talking to paul from florida. good morning. caller: good morning. this country is 250 years old? why didn't we think of what the democratic party has done up to

now? just think of all the thinking and arguing and this other stuff they did to keep the balanced budget and develop solid when all they have to do borrow so much money that the government does not have any horizon on how to pay back. my feeling is this, this is all graded. why don't we do it again next year pass another 7 billion dollars in bills? if this is working, let's do a more -- it more. host: henry michigan. good morning. caller: good morning. my concern is, i live in michigan.

why are all of these people complaining about the money budget when they got to get this guy time to fix what he had to fix because of four years. i do not complain when i get. i do not complain how much i spend because i know is when the cause because everybody got to pay the costs. gas $3.24 right now in stanton michigan. i'm not complaining. i voted four years ago for a man with we put him in there and he did a fine job. my complaint is of the price and stuff got to go down the public

got to get the guy time to get it down. host: many people are concerned about rising interest rates. announcing gay quarter-point -- announcing a quarter-point rate hike jay powell talk about the signals he looks for in determining whether there is going to be another hike. here is what he said last week. [video clip] >> my colleagues and i understand the hardships that high inflation is causing and we are committed to bringing inflation back to our 2% goal. over the past year, with taken action to tightening the stance of monetary policy. we have covered a lot of ground and the full effects of a rapid tightening so far are yet to be's solved. we have more work to do. price stability is responsibility of the federal

reserve serves as the bedrock of our economy. without price stability the economy does not work for anyone. without price ability we will not achieve a sustained period of the labor market conditions that benefit all. today the fomc raised our policy interest rates by 25 basis points. we continue to anticipate ongoing increases will be appropriate in order to sustain monetary policy that is restrictive to return inflation back to 2% over time. we are continuing the process of significantly reducing the size of our ballot sheet -- balance sheet. host: let's look at what our social media followers are saying about the top economic concerns. one suite says my friends and i are concerned because federal reserve is not good and we might give our savings to our.

corporation are making record profits by increasing prices and not getting any blame for price gouging and they get huge tax cuts so why are they prices? another tweet, 517,000 jobs are good but not for wall street. one final tweet says closing the border reduces the numbers of construction workers. we need immigrants and workers. we need to know -- we want to know what your top economic concern is. mark in oklahoma. caller: good morning. i hope everything is going well with you. hello, america. let's get interesting here. this is how we change it. i make over $80,000 a year in tulsa, oklahoma. i'm not swaying out -- sweating

it out like many americans. i've driven through the city here and i go to the community and it is a ghost town at night time. there is no crime. everybody is in the house. it seems like community in our society is diminished. we need to realize what is going on. we live in a mafia government. the permit scheme was designed that way -- pyramid scheme wasn't designed that way. we could go all in on about our top -- constitution to help rick is -- rigged it is. the ones that do not want us to

see the documents are the ones who control everything. host: michael from new york. good morning. caller: good morning. my most economic concern i have is the value of the dollar. as you know, everybody across the country to eat. the value of the dollar in eu diminished. because of all of that was the tax cuts for corporations. 21% tax cut. as far as funding of the

government, why are we doing it ourselves as people? look at the price gouging. eggs, food, all of this. record profits. that is a sign we need to raise taxes on these guys because they are the ones raking in money and they are not shelley get out. the value of the dollar is my biggest concern and it will keep diminishing if we do not do anything about raising corporate taxes. host: ishmael in indianapolis. the morning. caller: good morning. thank you for giving me the opportunity. it is no matter if biden or trump or pelosi or mccarthy, it is corporate america. billy otherwise running the country.

look at shell. record profit. they are ripping off citizens of the country. thanks the clinton and republicans, the past globalization. china reopened the economy and we have to pay the price down here. we got resources. i think it is unfortunate. we need to wake up and blame democrats, republicans. it is corporate america. they are in charge of the country. this is the mafia of the whole 1920's in chicago. for us complain about each other, we need to wake up. you have to have two jobs to sustain our daily lives or keep our heads above the water.

let's quit blaming each other. let's focus on corporate america. host: chuck in texas. good morning. caller: good morning. my major problem with the economy right now is the inflation rate and although it is coming down it is a good think. it has been driven up by policies of the federal government. inflation is too much money chasing too little supply. there are two solutions, increase supply and reduce the amount of money available. the federal government has decided to punish the american people and reduce the money supply by raising interest rates enforcing higher unemployment. the better solution is to

increase supply. energy is at the basis of our inflation problems. we do not have enough of it. we need more. the economy demands more. the world that has more -- demands more and not have a sufficient supply drives up the cost of energy and inflates the cost of everything else because energy is a prior production system for everything we produce. the solution is simple. roughly 50% of all inflation is caused by -- 15% of inflation is caused by increased energy costs. the solution is to increase the supply of energy but this government has decided we were not allow -- we will not allow energy production. we would do all we can to limit it.

that's where our problem is. we need to turn the situation around. it can be turned around almost immediately and that would reduce the inflation situation dramatically. host: we would like to thank all of our callers who called in for our first segment. coming up next on washington journal. michael swain of institute will be here to discuss the state of u.s. china relations following the discovery of shooting down a chinese surveillance balloon over the u.s. later rob in the house of the podcast full disclosure dives into friday's unemployment numbers and explains the latest efforts by the federal reserve to rein in inflation. but first as president biden prepares to deliver th they of the union address on tuesday night we are sick and looks at ke moments from evious addresses -- taking looks at key

moments from previous addresses. here is harry truman and jimmy carter. >> american soldiers are fighting a bitter campaign in korea. we pay tribute to their courage, devotion and gallantry. because they know as we do that the aggression in korea is a part of the attempt of the russian communist dictatorship to take over the world step-by-step. >> at this moment, soviet troops are attempting to subjugate the fiercely independent and deeply religious people of afghanistan. we have the responsibility to exercise restraint in the use of our great military force. the integrity and independence of weaker nations must not be threatened.

they must know in our presence they are secure. but now the soviet union has taken a radical and aggressive new step. it is using its great military power against a relatively defenseless nation. the implications of the soviet invasion of afghanistan could pose a most serious threat to the peace since the second world war. the vast majority of nations on earth have condemned this latest soviet attempt to extend its colonial domination of others and have demanded the media withdrawal of soviet troops. the muslim world is especially unjustifiably outraged by this aggression against an islamic people. no action of a world power has ever been so quickly and overwhelmingly condemned. but verbal condemnation is not

enough. the soviet union must pay a concrete price for their aggression. [applause] while this invasion continues, we and the other nations of the world cannot conduct business as usual with the soviet union. that is why the united states has imposed stiff economic penalties on the soviet union. i will not issue any permits for soviet ships to fish in the coastal waters of the united states. i have cut soviet access to technology and equipment and agricultural products. i have asked our allies and friends to join with us and

restraining their own trade with the soviets and not to replace our own embargoed items. host: we are back and joined by hudson institute director miles yu and quincy institute east asian director michael swaine. they are in studio to discuss the state of u.s.-chana -- u.s. china relations. i will direct the question to both of you. what is the state of u.s. china relations today, now that the u.s. has shut down this supposed surveillance balloon that china sent over the united states? guest: it is an thematic of the current status of u.s.-china relationships. the u.s. and china are in a low state confrontation with a high hand.

in the old days, we called it the cold war. unlike in the cold war with the soviet union and the united states, we have a rule of engagement on human rights. we have the helsinki agreement and we have rules of engagement in the sea and air and even over mutual surveillance we have agreements, for example an open sky agreement. the soviet union can fly over the u.s.. that is by agreement. it is not easy to achieve. now we do not have such things. china has refused to get into this kind of managerial mode, so this is one of the things we are trying to do, so a lot of stuff

is at stake. guest: i agree that this balloon incident is in the medic of the u.s.-china relationship today. it is fraught with suspicion, distrust, tension over issues, real difficulty to try to engage with each other in a meaningful, constructive way. there has been a lot of posturing and this balloon flies over the united states. congress goes berserk. you have all kinds of statements about what to do to confront the chinese. the chinese claim is a civilian balloon and does not have military aspects to it and has been blown off course. we do not know for sure exactly what the situation was in terms of how the region is, but it gets shut down. that evokes a response from the chinese, so it is kind of tit-for-tat. that is what we have been seeing

in u.s.-china relations, a lot of posturing and emphasis on showing resolve and deterrence, not a lot of emphasis on trying to express levels of reassurance or trying to get to a middle ground. neither we nor the chinese are going to dominate each other. neither of us will capitulate to the other, so we have to find middle ground and it has to be based on substance. the process of doing that supposedly began in earnest with a meeting between president she -- wx -- president xi and biden. now he is not going to go, so you have knocked that back. we are sliding back again, and that is not good. there needs to be progress in the relationship so we can get concrete results. host: you were about to jump in. guest: the word relationship is very washingtonian.

so we talk about managing the relationship. the relationship can be managed, but we have to manage the different fundamental framework so it is constructive. we cannot make sure everything is hunky-dory to make things do things right. we have to do the right thing. in the last five or six years, republican and democrat administrations agreed we have to start with a new set of relationships, starting with looking at china as the most significant competitor, so no longer a conduit for the u.s. to achieve other strategic objectives.

that is why i sort of disagree respectfully. congress did not go berserk. this is not only a reaction to the violation of airspace but also a public relations disaster. this is sort of outrage to our own policies and crisis like this. host: i will give you a chance to respond. guest: i think congress really has overreacted in certain ways. members of congress have called this a sputnik moment and have said now we need to make demands on the chinese, we should have canceled the trip completely and demanded that the chinese come over here and apologize. all of this kind of dicta at, this dictation to how the chinese must behave, is not

going to get us anywhere. it is not going to get the chinese to respond in a positive way. they are not going to go crawling to the united states begging forgiveness. we have to establish mature, balance relations with the chinese. i do use the word relationship. this is the most critical relationship in the world. there is a whole set of reasons why the united states needs to deter and counter and push back against china but at the same time engage meaningfully with china to avoid certain types of crises and achieve certain types of concrete objectives. we cannot get certain things done in this country without working effectively with the chinese in a meaningful way. we cannot do that if we are constantly screaming at each other and getting into this over balloons and things like that. host: how important is the

cancellation of antony blinken's trip? is this a diplomatic crisis or is this just another step in the dance between two countries? >> guest: it is not technically a cancellation. the administration said they will postpone the trip. from what i understand, they do want to resume at the right time. that is good. he needs to go to beijing and start talking substance with the chinese. now they have to determine the best conditions because the next major meeting will occur between u.s. and chinese leaders later this year in san francisco when the united states hosts the meeting and president xi jinping will probably attend that, as my president biden. you will have another senior meeting. before that, youto have a

more concrete meetingmong lower-level people, so i think the biden people want to reestablish and have this meeting go forward. i think it probably will. the question is when. >> guest: meetings have to serve particular purposes. the u.s.-china relationship, we have too many banquets and meetings. it serves a political purpose for the chinese. it is more political than substantive. none of the major issues have been resolved. the chinese have conditions for this. it is important for chinese leadership to constantly engage with the higher level of u.s. government to show the chinese people that the chinese regime can really help with the leaders of the free world and to have this message. also, to have this kind of

bilateral relationship is also to demoralize our friends and allies. when we have the meeting with china, very important. we have to have a specific goal. if the chinese do not engage in substantive meetings, climate change included -- any ability to have all these meetings with china -- i think mr. blinken going to china is good but cannot capitulate to chinese demands. i have seen a list given to the biden administration at the be getting of the biden years and it was outrageous. most of them were ridiculous. host: let me take this moment to remind our viewers that they can take part in the conversation. we will open our regular lines.

republicans, you can call in at (202) 748-8001. democrats, your line will be (202) 748-8000. independents, you can call in at (202) 748-8002. you can always text us at (202) 748-8003. we are always reading on social media on twitter and facebook. i know we are talking about the surveillance blue now because that is in the news, but there are so many topics that the u.s. and china have to deal with with their relationship with each other. there is taiwan. there is chinese support of russia and ukraine. there are nuclear arsens d covid and trade. when we talk about the u.s. relationship with china, is there one thing we should focus on more than anything else?

>> the united states has from the beginning of the engagement 150 years ago looked at china as a country of consequence, against all the european countries in history we believed that china is a country of consequence, either malign or benign. so you go through the 1920's and world war two and the postwar, all recognizing the fact that china is a country that we cannot ignore. having said that, the current stage of u.s. china relationship has become a malign factor for the night estates. you mentioned taiwan and the war in ukraine. every single sentence, china's acting against the interests. but we must engage china to act responsibly in a way that will

fit superpower status. this is one of the things we do, but china has refused to play ball in a constructive way in my view. you mentioned taiwan. that is where i would summarize where we are now. guest: if i had to pick one issue where there is a real need to establish understanding between the united states and china relating to issues of war and peace, it is taiwan. the taiwan situation has deteriorated in a significant way over the last several years. originally, the united states and china achieve stability of with a certain understanding, a tacit understanding. it was readily understood by the two sides. on the one side, a one china

policy by the united states, which says the united states acknowledges there is only one china and it understood, did not formally recognize but understood and did not challenge the chinese position that taiwan was part of china. on that basis, the united states committed itself to unofficial relations with taiwan to preserve that one china policy. in return, the chinese admitted themselves as a first priority to the search a peaceful unification, a way to have peaceful unification. both of these positions have steadily freed over the last several years, in particular since 2015 and the trump administration. so both sides have significant distrust and both suspect one another, that they are not upholding the original agreement. therefore, they are doubling

down on deterrence and not focusing on what needs to be done, which is to reestablish the original understanding through reassurance on the one china policy and peaceful unification. i think that can be done. the two sides need to talk about that to reestablish that level of understanding. guest: i agree on the part of the initial engagement agreement, but there are three parts of that. one is the one china policy and we agree to that, but other conditions are crucial and the chinese government does not want to talk about it. one is the u.s. objected to -- we have strategic intent that can evolve if that condition is violated. a secondary condition is any future settlement on the taiwan

straight has to be agreed to by both sides, by people on both sides, so those are three integral parts. you cannot make the taiwan issue solely an issue of sovereignty and ignore the other parts of that. michael mentioned 2016. he is right. many things happened. the taiwan issue is less and less an issue of sovereignty. war and more people talk about the taiwan issue from the perspective of freedom and democracy. taiwan has changed. taiwan is no longer a passive player because it is a significant player in international economy, trade. it is the ninth biggest trade partner of the united states.

it dominates some of the critical functions of the world, of chips for example. it produces 90% of global chips. in 2012, the xi jinping government create -- since 2012, the xi jinping government has created one crisis after another. the consensus now in the region is if china takes over taiwan china will continue to the next target, japan to vietnam, india, the philippines. because of this, the united states government along with many allies have made it clear that defensive taiwan is important not only to the region but the world.

with the ukraine crisis going on , xi jinping and putin have the same law -- logic, to invade other countries. they use ethnic heritage and legacy as justification to take over a neighboring sovereign country. i think taiwan is very important. i agree on that, but probably from eta for perspective. -- from a different perspective. guest: it is not american policy to defend taiwan. it is not required in the taiwan relations act, which states the united states must keep the capacity to defend taiwan, if that were to be the case, if that were necessary. it is not a security commitment. taiwan is not a security ally of the united states, but the united states would regard a threat to taiwan with grave concern, as it is called in the taiwan relations act, and

trigger the president informing congress that there is a threat to the security of taiwan which would trigger consultations with congress as to what to do about it. that is called strategic ambiguity. the united states has not stated that taiwan is a critical strategic defense era -- area despite the fact that a senior u.s. defense official made that comment in front of the congress some time ago. it has never been repeated and has been recognized within the government as a mistake. so the united states does not recognize that taiwan is critical to the security of asia that must be kept. that is a violation of the existing one china policy, so you cannot throughout that policy and act as if taiwan is a security ally because if you do we will be at war with the chinese. this is a war and peace issue. miles might say that sovereignty is not the issue. tell that to the chinese.

sovereignty is the issue for them and it is an issue for which they would fight. if we packed them into a corner, we eviscerate the one china policy, they will feel no compunction to uphold the peaceful unification objective, which is what they said they would do, and we will be in a severe crisis, not a war with the chinese. nobody wants that. that will destroy taiwan and wreak huge damage on the united states and china. there will be no winner, so why are we eroding the one china policy and talking but wanting to defend taiwan in ways that are not justified by u.s. policy? i think it is a dangerous course of action and the united states needs to rethink it and be very clear about what the limits are on its support from taiwan. host: we have to get our callers

and viewers into the discussion. maybe they will allow you to respond. keith is calling from falls church, virginia. caller: i wanted to say i do not know why people are concerned about this whole chinese spy balloon thing when they should be more concerned about how china influences us through tiktok and all that. yeah. that is all i had to say. guest: this is all related. tiktok and the balloon represent that china has sponsored the surveillance of america. it is continuing and constant. it never stops. there are some areas, like tiktok -- is invisible.

the balloon is tangible. it is visible, so for many of us it comes as no surprise at all. for the average american, this was eight the chinese are coming moment and there was reaction. it is understandable. the reaction is understandable because it is the reaction toward our response to it. i do not think the government handle it well and that is one of the reasons there is such uproar. as to taiwan, we talked but the danger of war but -- there's always talk about the war. china declared sovereignty over many things. we say we can also have elements

of that, freedom versus dictatorship, for example. china declared sovereignty over a big chunk of territory, so you have to understand this is not just about taiwan. it is very dangerous if we do not know that. the whole idea of strategic ambiguity is ambiguous in the first place. the united states strategic intent to defend taiwan is always interesting trickling -- been strategically clear. mr. biden has said routinely that if china invades taiwan the united states military will get in. there is nothing a big u.s. about that.

what is ambiguous is operational and tactical ambiguity from an operational point of view. that is ambiguous, but strategic intent has always been there. the taiwan relations act -- this helps taiwan to maintain defense capabilities. it is pretty serious over there. i will stop there. we have our security arrangement with taiwan. host: respond to that, but also our callers concerned about tiktok. guest: tiktok, right. we can get into that. i think the united states has not made the kind of commitments that miles seems to suggest it has regarding taiwan. the united states has to make a

decision to deploy combat forces in the case of a security threat to taiwan. that is laid out in the taiwan relations act, so there is a stopgap there to make sure there is an assessment of what the threat is and then to respond to it. it is not automatic. if it were, we would be in a different relationship with taiwan and china. so it is a conditional kind of thing. we did not come to the defense of taiwan in 2003 when the chinese were firing missiles at both sides of taiwan, a high visibility threat to taiwan. we did not deploy forces against china directly. but the provocation in that case was taiwan. the president of taiwan tried to move taiwan toward a more legal independent stance.

the united states blocked it. the united states said that is too destabilizing. you do not want to do that. so it did not deploy force. it will make a calculation as to when and how and under what conditions to deploy force. that is not simile a tactical question. it is also a strategic question. -- to defend taiwan because that could create problems in taiwan and china. for them, the worst case situation, and drag us into war, which we do not want. host: eddie is calling from texas on the independent line. caller: i was going to make a comment about the chinese balloon. most likely it was filled with helium gas. the only place you get helium in the world is in texas.

i use this as an analogy because here it is we sent china helium gas they needed to float that thing over here. to use an analogy on you, it looks like we are sending our money, technology, jobs over to china and they just send it back to us. i will leave it at that. guest: there is different issues that have been bound up in this comment and remark. i do not know texas is the only source of helium. i do not know what that is about. when the u.s. aircraft shot down the balloon, it did not explode in flames, apparently. it deflated, so i do not know what that tells you. helium is pretty flammable. so i do not know what is in the balloon. we could probably find out.

if the u.s. finds the wreckage of the balloon, we might be able to find that out. i think it is inaccurate to say that we have simply sent everything over to the chinese and now the chinese are using what we have sent against us. that simplistic understanding of the dynamic here does not serve anybody, certainly not u.s. interests. our relationship and record of interaction with the chinese in terms of trade and technology has been a mixed bag. there have been definite downsides. there have been loss of manufacturing jobs as a result of china opening trade with the united states come up with her has also been the it's bp a mixed bag in that area. china's growth and development in general is a major driver of global growth, about 1/3 of global growth occurs because of china. that's growth. that's not negative growth.

that's the growth of countries. so this is a country that resorts to certain bad practices in certain areas regarding trade, tech, investment, other things, but has also some very positive impacts on the world and on us, economically and otherwise. all of that speaks to the need to have a complex policy that can balance among these different areas to both counter the chinese or deter them or shape their views but then in other areas develop some basis for cooperation with them, a stable middle ground and avoid misunderstanding. i think that complex policy is what we need to be pursuing, not just a one-dimensional china is the wrong country, it does everything wrong. we have to push back in every way. that is not going to get us to where we want to be as a country. host: miles? guest: i think china's economic growth, almost 100% of china's economic growth has come out of

one factor. the chinese apparatus, communist party, is pretty much like a -- the communist party right now is cracking down on the -- the economy is in shambles because of mr. xi's political policies. that will have a negative impact on the global economic growth as well. the caller's question is very important about helium. i don't know whether texas is the only supplier of helium or not but it does say something about this entire u.s.-china dynamic, that is as much as china poses a threat and chal toning the rest of the world, china's economic engagement with the rest of the world is very high stakes for the chinese government. china depends on the international engagement. china exendz on access to -- depends on access to u.s. technology. the united states has a lot of leverage in dealing with china

and so that's why i fundamentally disagree with mr. swain's prediction about gloom and doom of the imminent war china will cause and -- because we do have leverages. we have a lot of ways to deter, to make china realize the cost of misbehave haifer and that's why i think -- misbehavior and that's why i think through a commitment like our security, military commitment to defense of taiwan, like mr. biden's statements, that's how we can make the world more stable. to make no mistake, the reason why china has not invaded taiwan is precisely because america's strategic commitment to taiwan's defense. there was a mutual defense treaty. after 1980 there was the taiwan relations act and american presidential declarations of defense of taiwan.

michael mentioned about 1995 deployment of american aircraft carriers there. you don't need troops there. but that was very strong commitment on behalf of the american people through president clinton. every president after that has never given up on americans' military intervention option in the taiwan scenario. that's what keeps the taiwan straits secure, not any sort of strategic ambiguity. to the chinese, the americans' resolve to intervene in the taiwan scenario has never been ambiguous. never believed the americans would not intervene. so this testifies to the futility about talk of strategic ambiguity. by the way i think it's a mischaracterization of american intent. host: i see you want to jump back in, but i want to get this in here. speaking of doom and gloom, we had a top u.s. general, air

force general, with a leaked memo that says he expects a war with china. i want to read this memo to y'all and get your response to it. in this memo, a leaked memo from a u.s. air force gener he says, "my gut tells mill fight in 2025. ief cured his third term in october taiwan's president elections are in 2024. the united states presidential elections are in 2024 and will offer xi a distracted america. xi sees reason and opportunity are all aligned for 2025. i hope i am wrong." michael, is he right? guest: just a point of dplair case this was written as part of a internal memo that the general had been sending within his command. it was leaked to the outside. never supposed to be seen.

we can see i think why it was never supposed to be seen. generals have no business -- serving generalling in the united states military have no business making such statement, that it's their gut instinct that we are going 0 be at war with the chinese in two years. it's based upon speculation, pure speculation, and it serves to hype even further the kind of war mongering, war miss ter ya in some quarters that is really gaining ground in the united states. the idea that we are almost in an inevitable course towards war and a response to what miles said before, i am not by any means predicting a war over taiwan. i am just saying that the trends are not going in a good direction to try and avoid a serious crisis and possibly even conflict. generals talking like this do not serve american interests. the united states military is a very potent and capable tool, a tool of the u.s. government.

the civilian government military leaders should be talk being their capabilities, they should be talking about how they can best serve the national interests as a military. they should not be riffing about whether or not the chinese are going to be attacking in two years or so. and after this came out, the department of defense explicitly came out and said this does not represent our policy. they directly refuted what the general had to say. so people need to understand that we are not -- our interests are not being served by this kind of loose talk in this way. let me just say one word about the president biden statement which miles had remarked on. yes, it's true, president biden has now said three times that if china attacks taiwan, we will come to the defense of taiwan. three times, the state department has corrected it. because it is in fact a violation of american policy. we can say well, the president

said it, so it must be true. presidents say a lot of things. they don't necessarily say things that are convergent with what the existing american policy is. i know why president biden said that. he wanted to show resolve. he wanted to show in the context of the war with ukraine that the united states will be supporting taiwan, all good. but to say, predict, we will come to the defense of taiwan, direct violation of existing u.s. policy, has been corrected. host: miles? guest: michael is wrong. the state department did not correct the president. the state department -- what president biden has said is con is cystent -- consistent with our prevailing policy. that policy is strategic collaboration. what the state department says is always that what president biden has said is consistent with our policy toward chinese,

period. no more other comments. so the idea, the myth that somehow there is a conflicting view about our commitment to taiwan's defense is totally false. factually and conceptually. so number two, i will say that americans, we are very good at beating to death the remarks, dr. strangelove, war mongering. if you really want to find war hysteria, you go to china. on a daily basis, the general secretary of the chinese communist party said repeatedly the p.l.a. should be ready tomorrow to get into major war. that's war mongering. that's extremely irresponsible. so i think this should be known to the american people that real wore mongering -- war mongering

is not in the west, it's in china. that's why the stakes are so high. host: i will give you a chance to respond. guest: two wrongs don't make a right in this sense. u.s. officials have said -- u.s. military people have said exactly what miles said, which is that we need to be ready to fight tomorrow. peace through strength. we need to have a military second to none. we have to have incompetent kability -- capability to fight and win. is that war mongering? you have a statement by the united states military saying it wants to be capable. it needs to be capable to protect its interests. the chinese have said the same exact thing. so both sides are engaged in similar types of sabre rattling, expressions of resolve, emphasis on deterrence, very little in the way of trying to reassure each other that the worst case fears of the other side will not come true, and on taiwan this is absolutely critical. the united states needs to do more to reassure the chinese that it is not going to bankroll

taiwan's independence, that it still adheres to the one chinese policy which is the only basis for stability in the taiwan strait and by the same token, the chinese need to send credible messages to the united states that it remains committed to peaceful reunification as a top priority of its government, which it has been committed to for decades. we can argue about whether or not these two things are being violated right now. i would say they are by both sides and the process is interactive. onee says something, that provokes the other. we go back and forth. host: quick final word. guest: the anol sis of the scenario, it doesn't conform to reality. the reality is no responsible president of the united states would have the level of a war statement like the chinese leaders do. number one. number two, mr. swaine mentioned

about the taiwan independence. this is a red herring. there is no taiwan independence movement in taiwan, no political leader in taiwan has openly championed for taiwan independence. all it says is everybody in taiwan wants to -- almost everybody, wants to maintain status quo. status quo is not declaring taiwan independence. status quo is taiwan has already been a dependent reality. china's government always says there is taiwan independence movement. u.s. government has to stop it. this is a red herring. it doesn't exist. it's chinese war mondayering retik -- mongering rhetoric. host: let's go back to the phone lines, leo from san diego, california, on the democrat line. leo, good morning. caller: good morning, mr. yu. i would like to speak directly with you. please correct me if i am right or wrong. before president biden was elected, he said the chinese

were just a competitor and they're not bad folks. then an inordinate amount of money was spent on the election and after the election, the vice premier of china said we finally got our man in there and we should be easier to work. now bloomberg a year ago said that the chinese have invested $3 trillion into our economy by purchasing major corporations that control the food supply, they control the education. they control hollywood. they control the stock market. their influence in this country is beyond compare. now, if we could just set aside taiwan for just a moment, could we concentrate on the congo, on all the minerals, could we concentrate on the south china sea? my god, i could go on forever. but the problem is that the --

how do i phrase it -- the trojan horse has entered the gate. i guess i will leave it at that. thank you for your time, sir. guest: i think one of the traditional methods of china's governmental action is the elite capturing in the west. they have spent enormous mup -- money on former senior american officials to act on their behalf. they also pour in billions of dollars into american colleges and universities to influence how our kids are taught about china and the problem is for example we find out there is more than one -- $1 billion chinese government has spent on american university campuses, not reported as required to the american department of education. this is a very important thing. i cannot speak about specific test that you mentioned or mr. biden and his comment on china. but i do know this.

when mr. biden talks about competition, competitor, the idea of a strategic competition with china is very important. it was introduced first by the trump administration. this is different from the engagement policy. the engagement policy, that means we will engage china at any cost in the hope of fundamental changes. and that basically -- basic vision was dashed. introduced strategic competition. now competition involves many things. number one, competition like all competition in the race either sports or backward fun -- backyard fun, have to have one winner. there is no -- it's not necessarily a zero sum game because the nature of the two systems are so different. the interests are so different. so that can only be one winner. either the united states or china. china has that understanding. xi jinping said the competition

with the united states is not competition. it's a struggle. it's a you die, i live kind of thing, chinese perspective. we must respond in kind. secondly, i would also say that competition also implies that all sides must apply to the same sets of rules, and you have to follow the same regulations. so this is what this administration and the previous administration have been trying to do, to force the chinese to follow the same sets of rules, rules based on international order is really simple. i think we have all -- we will have the responsibility to work together to make china like a big country of consequence to follow the same sets of rules as everybody else. host: michael? guest: well, there is a lot there. i would say first, going back to another comment that miles said, that there is no support for taiwan independence because taiwan is already independent, that's interesting when you

think that former vice president mike pompeo has openly said taiwan should become an independent and sovereign nation, which suggests to me that taiwan is not an independent and sovereign nation. he thinks the united states should recognize that in fact it is a sovereign nation. if we were to do that, if the united states was formally to do that, we would likely be at war with the chinese. that would be a disastrous mistake that we don't need. there is absolutely no reason for that kind of action to be taken by the united states. now, people on taiwan in general, i agree with miles, they want the status quo. what does that mean? they don't want to move towards unification by any means. they rejected the one country, two systems thing for taiwan because it would happen in hong kong. but at the same time, they do not want to move towards independence, towards formal independence, because they see that as a clear danger for taiwan.

so the importance is to maintain a credible balance in the status quo on that issue. but that has not occurred. taiwan's government has slid away from what it used to have as its own one china policy, to a policy now of saying we are a de facto, independent country when in pact they -- fact in they are not. you have a situation where that is sliding in that direction and at the same time the united states and china are both as i said before doubling down on reeding the one china policy, eroding policy unification by stressing deterrence. there needs to be credible reassurance that they will adhere to the original understanding, that traded those two concepts in the 1970's. there is no alternative to this. the alternative is a course towards conflict. host: miles, before you respond, you brought that up and i want

to make this part of whatever your response is. you were the then-secretary of state's top advisor. i want you to remind our viewers what the trump administration's china policy actually was and talk about whether it's changed under the biden administration. guest: first of all, i think mrl mistakes there. pompeo was not a former vice president. he was secretary of state. >> pardon me. guest: secondly, his statement was totally wrong, mr. pompeo did not say taiwan was to become an independent country. i was the top china policy advisor. i know what he said, intended to say even. he said speckly last march -- specifically last march that taiwan is already an independent country. this has to be recognized by international community including the united states. the taiwan international leaders have said this all along.

the sitting vice president of taiwan right now has said some 10 years ago that there is no need for taiwan to declare independence. taiwan is already an independent country. its name is republic of china taiwan. that's as clear as can be. there is no evolving concept towards a newly declaring -- declared independence. you asked about the trump china policy. the trump china policy was nothing short of a revolution in terms of our change of course because of several new realizations. we stopped playing the china card. the 2017 and 2018 national security strategy, national defense strategy, china, russia, north cree a -- korea and iran as a sovereign threat of united states. of all the four, china was the

only country capable and it was clear to say the strategic intent to beat america. so that's why china became america's number one national security concern. that's the most important fundamental change from the trump administration. secondly, it was during the trump administering -- administration we also established an end to the engagement policy. we changed to the strategic competition. thirdly, we stopped principal reciprocity. we talk about the u.s.-u.k. relationship. the biggest relationship is with china, china wants to be treated differently. we have reciprocity. you kick our people out, we do the same. last thing i would say is very important is that we stop this very, very pernicious practice of anger management. we have dealt with china for the

previous four decades. how china might be mad at us if we do one, two and three. so that is not good -- we changed that to one of america's interests. we do one, we do two, should be right course and let chinese react to that. so this policy is so amazing. it's not just republican policy. this new trump era policy has reached national consensus. you go to congress, you go to any corporate america community, and there is near unanimity on this issue. so i think that the biden team more or less, more or less, continues that policy. i will say more rather than less and there is a difference in terps of style and approach, particularly when dealing with issue with alliance. but china is continuing to be the number one national security concern. that is bipartisan.

host: michael, your bio says you advise the u.s. government on security issues and tell us your perspective of the differences between the trump administration policy and the current biden administration china policy. guest: i have been a china security specialist for 40 years. i won the carnegie endowment for a think tank and i was at the rand corporation. part of my duties have consisted of briefing u.s. officials, military officers in hawaii and in washington about security issues. a big part of that had to do with crisis behavior, crisis management. that is one major area where both the united states and china have really dropped the ball. recently the chinese have discounted crisis communication dialogues after nancy pelosi's trip to way wan -- taiwan. we need to make those talks more effective and broad, include

civilian officials, not just military to military. so i worked a lot on trying to get u.s. leaders and officials in china and in the united states, i work with chinese collaborators on this, to understand better what the dangers are in crisis perception, in crisis signaling so that we don't inadvertently get into a much bigger conflict over taiwan or whatever. that's a big part of what i have been doing. your second question was? host: different between the trump administration -- guest: i tend to agree that the trump administration, the biden administration has carried over much of the trump administration's policies but without a lot of the hoopla, a lot of heated rhetoric and lesser amount of disjointedness. there is a lot of disjointedness in the trump administration. president trump would say one thing about taiwan, very positive, then say something very negative. he would be all over the map.

then you would get something said by secretary of state pomp payo or whom -- pompeo or whomever in the administration. there wasn't a clear position but it was in general punitive. the idea of loading tariffs on china, loading sanctions on to china to try to correct our trade imbalance which under trump continued to go up and up regardless of having done that. the policies did not produce significant advantages for the u.s. national interest. the united states has decided to carry through a lot of this, democracy versus authoritarian stuff, the tariffs which they haven't raised. they haven't altered the closure of dealing with chinese consulateses in the united states, a lot of things that they haven't gone forward with because they haven't really engaged the chinese and the chinese haven't done so either. they've been posturing with each other because in part the united states wanted to build greater support among its allies and friends in dealing with china.

that's been a mixed bag. but the united states has focused more on that than on actually engaging with the chinese and even though engagement may be in a formal policy sense as a name for a policy, no longer being used, the administration right now is trying very much to reengage with china. it wants to reengage with china. host: quick response. guest: we have to reengage china with american interests in mind. michael used the words like punitive and emotional. it's not true. the trump administration's response to china without a doubt was a bilateral relationship, based on american poll at this -- policy toward china. yes, president trump will say a lot of things but his fundamental principle is always there. he treats china as seriously.

anybody tried to equate china's response to american response to the mutual interests -- i mean it's not true. if michael has this magic wand to force china to come to the negotiating table, talk about engagement, that would be great. you deserve a nobel prize for that. but china doesn't play ball. so that's why in dealing with china in the last five or six years, we are not punitive. we are basically realistic. china understood that. they understand that as well today, so you have to deal with china from point of view of strength and seriously. if you don't take yourself seriously, china don't take you seriously. one last point for example, china is not -- a particular policy. which party is in power, the very existence of america is a

mortal threat to the chinese communist regime. that's because their biggest fear is chinese people. about chinese people identifying with american values. that's why whenever we say mr. pompeo or mr. trump say, there is a different between the chinese communist party add the chinese people. the chinese communist party goes berserk because that's their soft spot. host: this conversation could continue for hours, but i think we are going to run out of time. but before we do, this conversation actually will continue on capitol hill this week because on thursday, the deputy secretary of state will be nefg front about u.s. policy toward chinese, strategic competition and the recent violation of american airspace. you can actually watch wendy sherman testify in front of the senate foreign relations committee on thursday.

you can watch live coverage here on thursday morning at 10:30 a.m. eastern, on c-span3, c-span now or online at c-span.org. let me get one more caller in before i let you gentlemen go. let's talk to thomas who is calling from florida on the republican line. thomas, good morning. guest: good morning, gentlemen. i want to say one thing and people are forgetting the big picture. china is looking at this, russia is looking at this, iran is looking at this and the big picture is they don't have any sovereignty over american airspace. america, the biden administration was too hesitant to shoot that ba00 down. that should have been shot down. if the shoe was on the other foot they would have taken out any type of aircraft that we had up there. they would have taken that down. it's ridiculous what they did, hesitating like that. just want to say real quick, all the democrats that are

supporting biden, shame on you host: michael, i will let you jump on that one first. guest: i think we discussed that already. i don't think it's at all shameful that the biden administration wanted to see what was going on before they decided to shoot down that balloon. they very much expressed concern about debris falling on people in the united states which was a legitimate concern. we can argue about whether or not the balloon should have been shot down as opposed to some other effort to try and retrieve it in some way. but i just think it's what miles said earlier at the beginning that this kind of an interaction, the way it's been handled by both sides, is emblematic of the kind of distrust, the kind of hostility, the kind of overreaction and incompetence frankly that -- particularly on the chinese side, we didn't have time to go into it but how did this balloon get launched just before blinken's trip? did xi jinping really give approval for this balloon to be launched over the united states right on the eve of blinken's

trip? it seems counterintuitive when he is trying to have a positive relationship with the americans to have this balloon launched. my de-- we don't know exactly by who and for what purposes. it might have been to emgairs the -- embarrass the americans and try to derail the entire meeting. we simply don't know. there is not enough questioning and wanting to examine these kinds of issues going on right now, particularly in the u.s. this setter tide -- certitude as to what happens and that certitude isn't always there. host: miles, final word. guest: i think china is a controlled society. society doesn't function like the united states where you have bureaucratic ipped pents on different level. every single move has to be approved from the top. this also fits into a traditional chinese tactics. what they call to u.s.

confrontation to ebbing tract -- extract corporation. every time there is a major incident like this, the chinese government does something like this because they want to gain political leverage. they want to control the course of the dialogue by creating a minor crisis so they can have moral strength at the negotiating table. this fits into the pattern. it doesn't surprise me at all. i don't -- they might look for a scapegoat. in the 1990's when the chinese military intelligence chief pours money into the clinton and gore campaigns and they get caught and the chinese government said no, this was from lower level and that guy was sacked. actions like that, you don't gey yourself. it has to be from the top. so we see the pattern again. i suspect it will go on for a long time. i don't think -- if wawnt to see

overreaction, you can find it in the united states. our reaction even though it's pretty tough right now, but the chinese right now as we speak have the national his ter yoo -- hysteria against the united states. they are protesting against the shooting down of the balloon. they fan the national xenophobia in china. i hope anybody who reads chinese can find out and you can see what real overreaction is all about. host: this has been a fascinating conversation. thank you, gentlemen for being here with us. we loo like to thank miles yu, senior fellow at the hudson institute chinese center, and michael swaine, program director from the quincy institute for responsible statecraft. thank you for being here. guest: thank you. guest: thank you. host: coming up next at 9:20, roben farzad, host of the podcast full disclosure, breaks down friday's unemployment numbers and the federal

reserve's effort to bring down inflation. but first we going to go to open forum where you with call in and talk about your most important political topic of the day. but first, president biden prepares to deliver the state of the union address on tuesday night. ipreparation we are taking a look at key moments from previous addresses. here is george w. bush from 2002 and donald trump from 2020. [video clip] president bush: our goal is to sponsor -- who threaten us with weapons of mass destruction. some of these regimes have been quiet since september 11 but we know their true nature. north korea has a regime arming with weapons of mass destruction while starving its citizens. iran aggressively pursues these weapons and exports terror while an unelected few repress the

iranian people's hopes for freedom. iraq continues to flaunt its hostility toward america and to support terror. the iraqi regime has plotted to develop anthrax and nerve gas and nuclear weapons for over a decade. this is a regime that has already used poison gas to murder thousands of its own citizens leaving the bodies of mothers huddled over their dead children. this is a regime in a agreed to international inspections, then kicked out the inspectors. this is a regime in a has something to hide from the civilized world. states like these and their troft allies -- terrorist allies, arming to threaten the peace of the world by seeking weapons of mass destruction. these regimes pose a a grave and growing danger. they could provide these arms to

terrorists, giving them the means to match their hatred. they could attack our allies or attempt to blackmail the united states. in any of these cases, the price of indifference would be catastrophic. we will work closely with our coalition to deny terrorists and their state sponsors the materials, technology and expertise to make and deliver weapons of mass destruction. president trump: an economic miracle is taking place in the ups and the only thing that can stop it are foolish wars, politics, horry dick will yous -- or riddick will yous partisan investigations.

if there is going to be peace and legislation there cannot be war and investigation. it just doesn't work that way. >> "washington journal" continues. host: we back and we in our open forum segment which means our viewers, you can call in and talk about your most important political topic of the day. we are opening up our regular lines which means republicans, you can call 202-748-8001. democrats, your line is 202-748-8000. independents, you can call 202-748-8002. dmeep mind, you can always text us at 202-748-8003. and we are always available on social media, on twitter and on facebook. let's jump right into our calls and start with eric who is

calling from reno, nevada, on the independent line. eric, good morning. guest: hello. i would just like to say that 35% of china's agriculture is grown in foreign countries. and i don't think there would be a very good reason to go to war. hello? host: you are still on, eric. guest: how are you doing? i just want to talk about the food crops that are grown in foreign countries by china. host: go ahead. guest: it wouldn't be in their best interest because most of their food crops are grown in australia and new guinea at the time. also, they're building infrastructure in nigeria and parts of africa. thank you. host: let's talk to mary calling from las vegas, nef -- nevada,

on the democrat line. mary, good morning. caller: good morning. i think the debt ceiling is the thing we should be concerned with right now. the g.o.p. campaigned on inflation and crime, not harassment. inflation is caused by corporate windfall profits. we need a windfall profits tax. it's coming down without the g.o.p. doing anything and inflation, the maaingas, extreme magas intend to shut the government down, raising the debt ceiling pays for bills already appropriated and approved previously in congress by both parties. this is something that has been done since george washington. it has been raised three times during trump's tenure adding almost $8 trillion of unpaid debt in four years. republicans think the g.o.p. were reckless under trump but is

still in favor of a default on our debt. if we do that, our whole economy and the world economy as well will face a likely depression. ok? social security checks will either be cut or not go out. federal paychecks, all kinds of things will happen. stock market will crash. we have to pay our debts. host: let's go to alan calling from north carolina on the republican line. alan, good morning. caller: good morning. thank you for your time. with all the think tanks and all the folks who are on this morning, we go back to vietnam, i am 64 years old, korea, just born when that was ending, and afghanistan, on and on. they come in and negotiate like we are at a town council meeting and all these young men lose

their lives. want to do action or take action or take a stand. we neetd to -- need to walk softly and carry a big stick and be resolute in what we are doing and where we are headed and not let things just creep in like a frog in a boiling pot of water. we have a lot of issues with china from supply chain to the balloon as well as other things. we need to really have a good focus on what we are trying to do instead of all the talk. thanks very much for your time. host: let's talk to sandra calling from alabama on the independent line. sandra, good morning. caller: good morning. i would like to raise three points and i will try to hurry. i want to talk about guns. i grew up in an area -- we had cap guns all the time. i never heard of gun violence

until the latter years because discipline has been taken out. children back then were taught in schools as well as home to honor god, the ten commandments, prayer and the pledge to the constitution every day. they use civic laws that would be hard for some people to even know what a more is. i would like to talk about -- i would suggest you read -- back in 2017 i called c-span right after mr. trump was elected. there was something you could feel something wasn't right. it's much stronger now. i don't know if -- something is going on behind president biden. host: i think we lost sandra. let's go to richard who is calling from pennsylvania on the democrat line. richard, good morning. caller: good morning, sir.

host: go ahead, richard. caller: listen, there is a whole lot going on. i defended this country. it's going to happen to you tonight but here is the deal. these people are spending money like crazy, they owe the chinese so much money it's crazy. let's find out how much they owe. can you hear me? host: we can. go ahead, richard. guest: can you hear me? host: yes, we can. hello? i think we lost richard. let's try william who is calling from hanover, pennsylvania, on the republican line. william, good morning. caller: good morning. well, i have been listening to you all morning here on the station here. i am on the road. but i have to agree with what

richard was trying to say, the last caller. there is really no future for any country that can't effectively manage their debt. we can't keep just piling on debt and have no way to pay for it. we have to come up with a different way, where we can make sure public facilities in the country can stay running while maintaining a profit margin for the country. we shouldn't be going into the negatives. we should be able to maintain that while getting a positive equation on the money situation. that's got a lot to do with why we have to concede so much to other countries. i got to kind of agree with the

stance that we really did hesitate on the balloon. i can't believe with all the technology and satellites we have that we did not know that this thing was in our international waters before it hit land. i think the reaction to this whole situation was very delayed. there was a lot of lack on surveillance and security that i know we have in this country. host: let's go to dominic who is calling from new york on the independent line. dominic, pronounce the name of your town for me. caller: east hampton. host: go ahead, dominic. caller: two questions about the upcoming state of the union. a, will the balloon make the speech? and if it does make the speech, in what way? and second, visually speaking

about the upcoming state of the union, will -- my memory of nancy pelosi tearing up president trump's speech is indelible and i am wondering if a reciprocal behavior would be well received. host: all right. keep in mind, the state of the union will start at 8:00 p.m. eastern. you can watch it right here on c-span. let's go to melvin, who is calling from mount pleasant, south carolina, on the democrat line. melvin, good morning. caller: good morning. i want to comment about the balloon that got shot down. caller: go ahead. caller: it should have happened as soon as we spot it. here is the thing. the problem is we are too busy hating each other, instead of finding out what is going on in the way world -- wide world.

our real enemies are people like china and russia and them, you know, black and whites and brown and all that, that's not the problem. if those guys get ahold of what -- we will get nowhere. i have lived through three wars so i know what i am talking about. it's like china did that balloon, well, hell, it could have been two or three more scattered around. seems like they were surveilling our military sites so they have three or four of those at the same time, can you imagine what will happen? let's stop hating each other because they don't like us no matter what color we are. we have to start sticking together. if war breaks out we are going to have to fight it. everybody have a good day. host: let's talk to rustle -- russell calling from washington, d.c. on the independent line. russell, good morning. caller: good morning. thanks for taking my call. back to the balloon for a moment, joe biden has all these

classified documents that it's illegal for him to have because at the time he was in the senate and vice president. only a president can have those classified documents. there is a lot of speculation as to what he might do with them or would he disseminate information to foreign powers? and now on the heels of him having those classified documents, he allows china to come over here and spy on us directly with that balloon. this is unacceptable. host: all right. let's go to reginald calling from north carolina on the democrat line. reginald, good morning. caller: good morning. i feel like that first of all joe biden is doing a wonderful job, and also the republicans put too much pressure on

george -- on biden. they put too much pressure on the man. i know it's a political thing, but i feel like as far as the balloon is concerned, russia and china is all working in one cahoots, you know. it just doesn't make any sense that we are being so slow and so naive that we can't see that russia and china are working together. so developing -- i think we need to develop a plan to -- about that border and stick to it this time. host: we would like to thank all of our callers for calling in with their most important political topic for that segment. but coming up next, we are going to take a full look at the health of the u.s. economy.

roben farzad, the hose of the podcast full disclosure, will be here to explain the latest jobs report and how the federal reserve is trying to control inflation. stick with us. we will be right back. ♪ >> book tv every weekend on c-span2 featureseang authors discussing their latest books. on i depth, journalist lance morrow joins us to take your calls on american culture, politics and history. he is the author of several books including the chief and the soon to published the noise of typewriters. and then on afterwords, community organizer sony, author of the great escape, retells the story of hour a -- how a group of men entered into the u.s. as gres workers only to become trapped in forced labor. he is interviewed by senior

fellow. watch book tv every weekend on c-span 2 and find a full schedule on your program guide or watch online anytime. >> this weekthe c-span networks, congress is in session. the senate will work on its first judicial nominations of the year. the house is considering realing the c.d.c.'s requirement for covid vaccines for all foreign travelers to the u.s. and a joint resolution regarding action by the d.c. council. border patrol agents will testify before the house oversight committee. on wednesday three former twitter executes with ties to the suppression of "the new york post" hunter biden laptop story will appear before the house oversighittee. and on thursday deputy secretary of state wendy s testifies before the senate foreign relations committee on the u.s. and china competition policy. watch this week, live on the c-spanrks or on c-span now, o free mobile video.

also head over to c-span.org for scheduling information or to scream video -- stream video, live or on demand. c-span, your unfiltered view of government. >> flr a -- there are a lot of places to get political information but only at c-span do you get it straight from the source. no mat irwhere -- matter where you are from or where you stand 0 -- on the issues, c-span is america's network. unfiltered unbiased, word for word. if it happens here or here or here or anywhere that matters, america is watching on c-span. powered by cable. >> "washington journal" continues. host: we back and we are joined by roben farzad, host of public radio's full disclosure, and he is here with us this morning to discuss efforts by the federal reserve and the biden administration to control

inflation and that new great jobs report. roben, good morning. guest: thank you for having me back. host: it's been a big week in economic news with the fed raising interest rates another quarter point and that huge job report that came out on friday. what do those two things tell you about the health of the u.s. economy right now? guest: the strength is deep. the verve is deep. i don't think anybody expected 517,000 jobs created in january, and there is an element of good news is bad news on wall street at least where certain traders were imagining -- it sounds perverse that maybe we would get much weaker than expected news and that could justify the fed being amenable to rate cuts toward the end of the year and i think that was promptly -- that notion was disabused by this strong jobs report. host: explain for our viewers what the federal reserve is trying to do by raising interest rates because as consumers all

we know is that it is becoming more expensive to get loans. what is the fed trying do by raising interest rates? guest: it's micromanaging the economy. in a perfect world it's not too hot or too cold. what we saw maybe last year especially with russia and gas prices was the economy was too hot and spending and consumers and hiring was a little out of control as evidenced by wage pressures and everything. we felt very high -- i mean abnormally high inflation combined with low unemployment. i think the fed would trade, its mandate is to have full employment and stable prices. right now we have full employment, arguably more than full employment at 3.4%, and not quite stable prices. it would rather trade higher unemployment for lower inflation if those two work in inverse proportion. yes, so the fed is micromanaging that. oftentimes it overshoots.

it tends to hike too much and to cut too much. maybe in hindsight it was overstimulative during covid at least in the very first innings of covid. we are paying the price right new and it's trying to mop things up. i counted eight rate hikes in this cycle and maybe four by 3/4 of a basis point, which is unusual. you have two by a half a point and the latest by a quarter point. so now the market is pricing at least two more by a quarter of a point. those are many rate cuts -- i mean rate hikes to mop up the stimulus that we saw a lot of in 2020 and 2021. host: now we know interest rate hikes affect loans and credit cards. do those interest rate hikes affect the cost of daily goods like eggs and bread and milk as well? guest: not directly, but if you do have interest rate hikes they

have companies thinking twice about hiring or thinking twice about the kinds of capital formation, building facilities, building payrolls, building new projects that would result in more jobs and more wages that could spend on things like eggs. i mean eggs have their own shock right now. eating out, travel, leisure, hospitality, that's how it works transitively. it's a blunt instrument. the fed doesn't have fine tweaks to address say travel or address finance hiring or specific things. it's a blunt instrument of taking rates up and down and it courses through the economy. obviously, real estate is a huge beneficiary in home building. mortgages and everything we saw really hot action there in 2020 and 2021 and it's cooling down across the country now, as mortgage rates go up. so you are seeing curtailed project spending, people being less apt to use real estate as a

finance arm and maybe a perceived recession in that sector. host: how much of this hot economy, the 517,000 jobs being created, is just a country getting back to normal after the pandemic years we have had where we lost a bunch of jobs? and now it seems like is this just -- these jobs coming back or are these brand-new jobs that have never existed before? guest: i think we will be studying that for a long time and that's the big question. that's why you get such a blowout number that nobody seemed to have expected this week, whereas i think don't have that much of a need precedent coming out of a situation where the economy froze in a matter of two or three days and people suddenly shut their restaurants, shut their hotels, had to lay everybody off. you started seeing the unemployment rates spike from

the low single digits to the high teens within a matter of days and the fed took interest rates down to zero. how do you plan for one of these things? you can only study 1918 to 1920 so much. we didn't have the modern federal reserve back then. we didn't have anything like supply china issues like we -- splien chain issues like we have today, sourcing things from china, from vietnam. there are still certain things you can't stock or find in the store. there are aftereffects of this great pandemic that happened. so we don't know how much of it was peculiar to the pandemic and the reopening versus how much of it could be ascribed to extremely stimulative monetary and fiscal policy in the year 2020. we saw tax cuts. we saw rate cuts take it down to zero. we saw all sorts of speculation and n.f.t.'s and property speculation, second and third

homes. to separate that from pure economic activityhost: the presg the jobs report is signaling that his economics agenda is working. guest: of course, you want to take a victory lap with that. he can say in spite of all the rate hikes, my economy keeps chugging along. ,, -- yes, there was stimulus. it did not have to do all that much with inflation. as it was infrastructure spending, there was some pork barrel in there. so he could argue that it has helped. but it is very hard to say.

donald trump could be given credit for physical -- his fiscal stimulus. i will say there was a tremendous amount of fear of missing out in this economy. if you look at this jobs report, there are still people that want to get back on the road, people that have put off weddings and trips and sorority reunions and they are hell-bent on doing that. that kind of spending is stimulative. host: let me take a second here to remind our viewers, they can take part in this conversation. republicans, (202) 748-8001. democrats, (202) 748-8000. independents, (202) 748-8002.

you can text us at (202) 748-8003. roben, the federal reserve raised interest rates by important point last week. does that and the jobs report make it more or less likely they are going to raise interest rates again? guest: it makes it more likely, at least a quarter point in the next meeting. there is not much science to this to try to see what the pain points of the economy is. you cannot imagine the federal reserve chief not being happy about a job port like this but it is not making his job easier.

you still speak to restaurant owners, to hotel rob breeders -- operators. you have to sweeten the pot with wages and benefits and perks and that is inflationary and that worries the fed. i think inflation is way too high for the fed's comfort. unemployment where it is right now arguably could be a little bit higher. what is the equilibrium that gets the fed to equal policy? that is the question right now. host: a lot of viewers may be confused at why the federal reserve would see people going to work as something that is bad for the economy. guest: not bad in isolation, but

this kind of story in hiring when you still have inflationary pressures in the economy. inflation is a very tough the beast to beat as evidenced as what was in the early 1980's. it works inversely proportional to employment in many times. it tends to be given to inflationary pressures because you are trying to get people to show up, you are out there buying goods and services that everyone else is trying to bid up. we did not have this before the modern fed. you would have panics come up and out the fed does a lot more than he used to do.

has this ability to take down the economy. you might be out there and fully employed by if inflation is that 6%, your wages are getting hit by that amount to every year. you are not keeping up. the fed clearly once more equilibrium than where it is right now. host: is there a magic number that we can look at and say the fatah probably will not raise interest rates again? -- the fed probably will not raise interest rates again? guest: we just did not know.

are you suddenly going to get an inflation number, no, you have to bridge the chasm and that oftentimes means higher misery, higher unemployment, less leveraged by the worker in terms of bargaining with the boss. that is the brutal duality of the fed world view. host: we will let our viewers take part. we will start with dave on the republican line. good morning. caller: hello, i am glad to get on. i want to ask roben farzad a question about the law of supply and demand, one of the basic rules of economics. it is like the law of gravity. you can talk about government policies.

all the peripheral things, and work participation rate too is the number i look at, not just the unemployment rate. we are down around 60% workforce participation. how about let's try 75%? that would seem to be something you would want to think about more. i sick on a zoning board here locally. -- i sit on the zoning board here locally. it is like the salem witch trials when you are trying to get a variance to get it through. they micromanage everything we do and it is in the way of rather than being helpful.

thank you. host: explain to us what the workforce participation rate is. guest: the unemployment rate backs out a lot of people who otherwise dropped out and were not actively looking for work. after a while, you just counted them out and you can say workforce participation has gone down. we saw a spike in dropout coming out of the pandemic. a lot of people reassess in their careers, may be saying i do not want to be working in a diner exposed to people who are not wearing masks. this was one of those moments where you had a big reset. so they are out of background. maybe they are going back to school or doing something entrepreneur numeral.

to that extent, you see workforce participation drop. the parallel criticism is that a lot of these sectors could have used more fluid immigration. if you speak to hotels and restaurants, the time was they could count on people coming from central america and mexico or others. the controversy there is to fill those openings and to do so at the man inflationary level. you have seen a show in immigration numbers -- chill in immigration numbers. there are too number openings and you cannot even bag people to show up and take these jobs. host: the current u.s. labor

force participation rate is 62.40% right now, which is up by 10 hundredths of a point from last month. that is where our workforce participation rate is right now. let's go back to our phone lines. patricia is calling on the democrat line. good morning. caller: good morning. my issue is that i do not hear any discussion of foreign investment and the impact of money coming from across borders. it seems likely have the same

conversation about our economy and inflation and jobs, with nobody looking at the big picture. of who is buying the homes, who is growing the new businesses. i do not come from a place of coming from being against immigration or foreign investment, but nobody talks about it. i do not know why it matters how many weddings there are if somebody else comes in with cash and buys a all our houses. -- buys up all of our houses. guest: that is fair in terms of houses, especially in the coast. a lot of foreign money coming in and property values versus wages being out of whack.

this has been problematic, but then you have foreign automakers bidding up potential battery facilities and then governors do not want to give them enormous tax breaks to do so because you can get thousands of payrolls out of that. that is another concern. you have portfolio investment versus actual capital investment. if you think about the japanese carmakers who were vilified for much of the 1980's, many of them have diffuse that criticism by building in the south. what is it to drive an american car versus the japanese car? i think a lot of this has changed right now.

the united states has become a more desirable venue for ensuring again in terms of utility prices being low, partaking may be in some of the boon the biden administration did. if you want to build a facility right now, the consensus is that united states is the place to do it right now. foreign buyers also help support markets that otherwise would have cratered. host: what was wall street's reaction to this week's market news? what did wall street have to say about that? guest: initially, there was a sell off. but then the markets were more sanguine about it. after all, recession is not good

for everyone. there are traders who want to divide rate cuts versus rate hikes. there are others out there that are saying we can actually achieve a soft landing. a consensus was that we are going into a recessionary year and may be we can avoid recession and that is not so bad in the end if the fed can engineer a soft landing. down the line, i will have a level of interest rate after eight or 10 hikes to cut, and so that is the good news. the market is very fickle from day-to-day. host: while all this at the nam -- economic talk is going on, there is a debt ceiling debate

here in washington. can you explain with the debt ceiling is? guest: it is the maximum amount of debt that uncle sam can issue . the maximum amount the united states can borrow. by no means it is concrete. it has been hiked so many times over so many presidential administrations. our borrowing amount goes up so much because of the economy grows. so much of it in the last 10 years has been a manufactured controversy. there are people who want to use an otherwise mundane thing. and turn it into a bargaining chips. the market kind of yawns about

it after a certain point. playing chicken with something like this, we did have our credit rating downgraded back in 2011 and it is not like anybody learned anything from that. the u.s. went on and kept issuing debt. it was a slap on the wrist, but it was by no means kind of reckoning. i wonder how many times that can be done. i wonder how serious it will become this time.

if mccarthy is talking about it, will he diffuse it? host: what will happen if they do not increase the debt limit? we had one caller without social security checks will not go out. guest: if social security checks are delayed, that hurts the real-time standard of living of people who are check to check, who are expecting that money to clear so that they can buy groceries. if washington d.c. were to shut down. if the federal government were to shut down. it is a whole other thing for contractors not going to be paid

because there is is an a la carte engagement. the last time we saw this happen, you saw an uptick in demand for soup kitchens and red. it is very real. it is one thing to use it as theater. it is another thing to experience the anxiety of messing your social security checks or your stamps clear. it is also a look for the united states. it is the development economies concern generally and it makes us look bad. host: let's go back to our phone lines. our caller is calling from texas on the india line. -- independents line. caller: will you explain that

president biden cannot lower or increase interest rates. it is a separate entity from bidens economic plan. it has nothing to do with him. thank you. guest: biden does not control interest rates. he and congress can get together for fiscal stimulus, tax cuts that are stimulative. if you look at fdr, there are certain presidents that have tried to browbeat their fed. there are other things of white house has, it can bring in wall street executives and say what is going on?

it also has the strategic petroleum reserve, which you can release some of that on oil two times a very high gas prices, maybe take the edge off for people. it is not like it used to be. there are certain circumstances with price controls, but nowhere near the power that the federal reserve has. host: let's talk to mike from houston, texas on the republican. good morning. caller: thank you. you mentioned it is not the president's control on interest rates. joe biden has a lot of influence on spending. when you have too many dollars chasing too few goods, that is the definition of inflation. i guarantee you that interest

rates go up to suppress the circulation of money and to reduce the activity out to bear. if you want to talk about the definition of inflation, too much money chasing too few goods. guest: fair enough, but imagine the white house getting together with the congress, you just cannot picture it. you want to stimulate and they do not know how to mop up on if it was too stimulative. there was a lot of excess. definitely fraud. people misrepresenting to get this money. in the fog of the pandemic and the federal government unleashed the money and that was

enormously stimulative. are you going to go back and mop that up? how do you do that? the fed cheaply is in charge of that. host: what action should american consumers be taking right now giving a where we are with rising interest rates and rising inflation? guest: the holy grail is inflation protection. the banks are being slow about taking savings and cd rates back up. so you as the consumer, do you avail yourself of government special savings bonds to go out there and buy two year treasury?

it is still shy of the inflation rate, but it is still something real. you are not getting anything on savings, you are getting return of your capital, not return on your capital. inflation really hits people across-the-board, especially people who are getting hit disproportionally in the breadbasket and are paycheck-to-paycheck. everybody is talking about eggs right now. it has a much more to do with the avian flu and garden-variety inflation, but that is hitting everybody. everybody is feeling its. you are certainly feeling inflation.

host: let's talk to dave from california on the independents line. good morning. caller: the problem i have with the way we are trying to attack inflation is that it is focused on demand. the very first principle i learned was the love supply and demand. when the demand exceeds the supply, that pushes prices up. there are two ways to fight inflation, reduce demand and increase supply. how do we increase supply? we can incentivize people to work because when people work, they do something productive

that contributes to the supply of goods and services. right now, the fed is trying to raise the unemployment rate so that there is less pressure on wages, which makes more sense if we are going to attack inflation, pay people back to work or pay them to work? the approach right now is completely upside down and i do not understand it. guest: there is that controversy. i can remember my professor my freshman year. do you have to throw the economy into a recession to read it of inflation? -- two -- to rid it of

inflation? so we are experimenting with this in real time. i do not think the fed needs to see much more employment in this economy. you are at a level that is really rich. you talk to my 13-year-old and they say why is vera natural rate? it is really nuanced, is really micromanaged. i do not think we have an easy analog to look back on.

i think it is much less science and much more got for jerome powell. host: let's talk to brian from tampa florida on the republican line. caller: good morning. people keep talking about the problem is that the consumer got all the stimulus stuff and that it fueled inflation, but what about the corporations that got the stimulus money from this horrible shutdown of the world. are they really spending it here in the united states? the other thing i never heard anybody talk about is the rental car companies, they reduced

their inventory by millions of cars. where did they all go and why aren't car prices low because of that? guest: a lot of great questions there. we will be studying ppe for a long time. you talk to business owners, i think the real big case out there was wimbledon aware -- where we will pay you a chunk of the lost ticket revenue. everybody else that i have business interruption insurance and enforce the federal government to effectively nationalize that insurance temporarily.

but that was massively stimulative. there is still a lot of best stimulus money in bank accounts that can be spent. by the end of that year, a lot of these workers were back at work, demand was going up, and it is not like that money was clawed back. that money is still out there to be spent. facebook just had layoffs and it announced a better than expected quarter and it announced a stock buyback. and so there is leakage. a lot of times, it is spent on other things. it is spent on stock buybacks,

dividends. it is not something the fed necessarily has strings attached to its stimulus. and it is the problem right now because the fed is trying to tighten and mop up all of the stimulative money. host: we are going to run out of time. we would like to thank roben farzad, host of public radio's full disclosure. thank you so much. guest: thank you. see you soon. host: we would like to thank all of our guests for another great washington journal. stay safe out there. i hope everybody has a great sunday and we will see you again tomorrow for another great

addition of washington journal. ♪