i like the e.w.j. japanese index funds. >> i like that. i like abi. more than just printing money. a real deal. >> gentlemen, thank you. cost of freedom the place for business. us. the era of big government is over. >> remember that 18 years ago. then president clinton declaring the big government was dead going in his second term. he said it as washington was in a massive reform of welfare. well now, with president obama getting ready for his second term "state of the union" address, welfare going the otheway. record one in five households are now on food stamps and a whopping 100 million americans are receiving some sort of food assistance. how did we get derailed from ending welfare as we know it? how do we get back on track? hi, everybody, i'm david asman. welcome to "forbes on fox." go in focus with steve forbes,

rich karlgaard, elizabeth macdonald, john tamby, rick unger and mike ozanian. how do we get back on track? >> cut welfare benefit not out of cruelty but out of compassion. there is nothing more life affirming than having a job but if you know the federal government will send you a check either way, less urgency to go out and find a job or adjust your wage demands to new realities. it's ultimately welfare serves as a work deterrent in the antieconomic growth after that. >> emac, the point is after the reforms, in the clinton era, the republican and democratic reforms we had a massive decrease in the number of welfare applicants and the case load plunge from 12 million in '96 to 5.9 million. more than half. good effect. we're going in the opposite direction. >> i hear you. i don't like what the administration is doing in terms of the band aids because

it's their jobs policy and the economic policies that are really a check on the job growth in the united states. listen, i would say don't cut food stamps. what about the single mom with the child? she needs food stamps and it's helped drop the poverty rate since 1967. c.b.o. confirmed that economic studies. academic studies confirm that cut ethanol subsidiaries and the $200 million of waste, fraud and abuse of duplication in the u.s. government. then the fraud in food stamps, not the food stamp program itself. >> rich, take out the welfare mothers for a second. talk about able-bodied single men without any dependents. that number has increased dramatically, double since 2008. if we were just to fe cous on that alone, we'd be getting somewhere, right? >> yeah. i think it's tragic. the thing is we have 7.5% unemployment. employers are feeling very cautious. this is what is tragic about this environment.

the economy is not producing the kind of jobs that it normally does. we will be nearly five years since the recession ended. we still have the abysmal figures. economic growth should be at 4%. it's 2.5-3%. that makes a difference. i would concentrate on pro-growth policy to get unemployment down to 5%. then look at welfare reform. >> rk, we're supposed to be in this recovery rightow. isn't now the time when we could do that? get back to those clion era reforms? >> i think we'd like to. but i got to tell you, i'm not as much fun today because i agreed with almost everything lizzy said. i apologize we can't fight. but i will pick on john. >> we're like an old married couple anyway. >> there are other people to fight with. >> john is suggesting that people are sitting back and taking the money and not going for jobs, completely ignores the fact that so much of the food stamp budget is going to people who do have a job. and can't earn enough money to

feed their families, even going to work. what about them? >> you know, a chance to respond. mike, americans don't have problem helping people who are down but they don't want welfare to become a way of life. unfortunely, that is what worries a lot of people, right? >> right, david. this started with president obama's predecessor george bush. he doubled spending on food stamps, under president obama it's increased 95%. you have to look at both of those presidents spending because what we have is stagnant wages for the middle clas we have the lowest labor participation rate we have had in 50 years. we have people participating with a job or looking for a job normally at a recessionary level. so you need some incentives in the marketplace if you want a capital listic economy. >> incentives work. >> you are not going to get food stamp reform or welfare

reform until you get the economy moving again, wch means simplifying the tax code, reducing tax rate, stabilizing the dollar, getting rid of obamacare and bringing in a market-oriented healthcare system and effective safety net. >> what about the dependency? the idea that welfare does, sort of sometimes stimulate sense of dependency on the part of its recipients? that is deadly. >> it is. this administration unfortunately likes that kind of thing. the administration should be cracking down on abuse of food stamps. which is widespread. you are not going to get real reform. most americans would like to work. we don't have the european style culture yet, but that is why we'll get the economy moving. >> john, must be like a pressure cooker. you had the pressure put on from rick. respond. >> if you want to help the poor people, and i think we do, why would you foi the federal government on them? they are the least qualified at bringing people out of quality. the problem right now is there is too much government. because there is too much

government, the economy is not creating the jobs that would lure people back in the workforce. it's cool what rick is arguing for. it creates disincentive. if you're a jogger you are less likely to run on rainy day. >> i was talk about the working poor. you are pushing the argument in another direction. i address the working poor. people who work in fast food restaurant and working at a large big box retailers who can't get paid enough money even going to work to take care of their family adequately. that is what i'm talking about. it's nothe entire budget obviously of the food stamp program but a large chunk of it. >> after clinton cut welfare, the economy took off. bill clinton's first two years were slow economically. >> hold on, hold on. >> funds shifted more from the government to the pvate sector. john is right.

that's when the economic growth and wages took off. >> i hear what you are saying but there is the housing bubble and the internet bubbling percolating at that time. here is the thing, the perspective you won't hear about in the "state of the union" coming tuesday night. that is why is this economy creating mix jobs, the low-paying job? that is the problem with income and story behind income and equality that president will hammer tuesday night. low paying jobs replacing high-paying jobs in this economy. that is the structure problem. >> go back to the clinton era reforms. not just bill clinton. it was the era. brought there by republicans who proposed this in the first place. there were specific requirements, work requirements. there were time limits put on weare. aren't those a good thing? didn't it change welfare and aren't we going against it now? >> it did change healthcare.

nationwide it went down sharply. on food stamps, the time to tighten up, david, is when people feel the economy is moving again. that is tax reform, monetary rerm and healthcare reform. >> rich, the fact is that the reforms they had 18 years ago focused specifically, they had 12 definitions of work. the definitions have been so modified by the obama administration. >> look, we know the system can be gamed and it being game and there is a lot of fraud in there. start with the basic questions. the largest employers in the united states have tremendous amount of cash on the balance sheet. yet, they are not investing for growth. why are they not doing that? they are afraid when they look in the future, there is so much economic uncertainty created by the government, they are not expanding. unemployment at 7.5%. i agree with steve. let's concentrate on growth. get unemployment down to 5%.

then trim back welfare. >> that's the last word. coming up, should the government be telling bosses what they can and cannot do with their healthcare benefits? another obamacare delay. fueling a debate.

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>> here we go again. there is an obama care rule to prevent companies offer executives from benefit than other workers get.

steve says the got should never tell private businesses how to compensate any of their workers, period. right? >> if they knew how to do that, the soviet union would have won the cold war. they could just run the whole economy. you see what the government has done with benefits and salaries and public employee workers. it's banupting government. let the private sector decide if there are abuse, lawsuits, and other things you can do. shareholders and the like. activist shareholders. gethe government out of t way and let the economy prosper. >> rick, health benefits are a form of compensation. as we mentioned last time, incentives are at e heart of the free enterprise system. you can't take that away. >> it is a fair question to raise. i want to point one thing out so there is a perspective here. this rule has been in existence for 30 years for companies that self-insure under the aristaaw. they have been following this for a long time and nobody was screaming about it. beyond that, i have to be honest. i go back and forth on this. i see steve's point. on the other hand we have seen

a lot of things along the way where the companies didn't behave as they should and it led to the osha department, the safety rules and things like that. so maybe it's fair game. >> mike, the point is if the government can start tellg businesses how to do some of their compensation, how long will it be before they tell us what we can pay employees? >> david, for somebody in washington who is a bureaucrat to think they have any notion whatsoever of how much somebody should be paid at a private company, exhibits an enormous amount of arrogance. i know that most of them have the arrogance and ththey want ever more power. but it's baffling that the public buys in to this to any degree. they know nothing about it, whether the ceo or a low-level employee and minimum wage. they are clueless to the market forces and they should stay out of it. >> sabrina, we were clueless about this being in the healthre law. like nancy pelosi we didn't know it was there until we passed it, right? >> rig. this is farther beyond healthcare. this is the problem with any

mandated benefits. one of things we want in the workforce is flexibility so employees can find jobs can best fit their need and the employers aren't burning with costs they can't afford. when the government steps in and mandates, whether it's the healthcare benefit or paid leave, all of these actually limit flexibility and choice. limit the ability for employers and employees to negotiate appropriate contract. >> this meddling is slowing up the economy. >> i agree. get this, this is effectively having aayczar athe r.s. becae thi.r. has to enrce is. e i.s. h tefin o is hilyompsateand wh are ch bit is i latic mplety fr the gvernnt, the ardefing wt isutopn nefi thanobo canfordn heth rorme ey're uninsuring the ensured. that is what is going on now. >> rich, out in silicon valley, the rarefied air there, they are always using compensation packages to lure employees in.

but this would take some of a keyheds, person policy where you just take care of the people who vital for the future of your company. so the insurance companies themselves who are providing this key person insurance are going to require that those people get a higher level of healthcare. to put it in context that people can understand, does it make sense for the denver broncos to give peyton manning little, a higher degree of healthcare than the person who washes the uniforms? >> good point. >> he has had two neck surgeries, multimillion investment in the guy. it just makes sense. >> again, it's a different form of compensation. steve, the fact is thishows you once again how the healthcare law can deal with all kind of ways in which we operate in the country. and mess those ways up. >> right. that is why healthcare eventually is going to get back to what it hasn't bn in 50 years,75 years, david. free market system with effective safety nets like

food stamps properly administered. to put this in perspective, in the mid-'90s, bill clinn put a $1 million cap on the ceo salaries. that was so unworkable it led to stock options and we know where that led. let the markets work. they will if you let them. >> rick, we have a delay now. not the only thing that is delayed the healthcare law. will it become a permanent delay? will it eventually be moved out of the healthcare law? >> i seriously doubt it. most of the things we have seen delayed are delayed under time period restrictions. no reason to think it would be. i suppose anything is possible. can i quickly say, though, why is everybody assuming they will lower the quality of the executives' insurance rather than raise the quality of the other insurance? >> that's how redistribution works. >> this is the same argument we use to combat the paycheck fairness act. department of labor say people bring home 70% of the compensation. 30% goes to taxes and

benefits. if people saw that on paper, they might s hey, you know what? i'm willing to trake some of my take-home pay for better benefit or vice versa. time off is more important than the salary. we think we need to think about this broadly and the implications for other benefits. >> simple terms. the i.r.s. gets a massive amount of questions wro on their 800-hot line. who is to say that the i.r.s. will get this right in defining what is a high benefit or exective pay? >> last word from emac on this one. remember this during the hearings looking for communists in america. >> let us now assassinate the land further. you have done enough. have you no sense of decency, sir? at long last, have you left no sense of decency? >> now the i.r.s. is doing something to a conservative group in hollywood that has some here asking does the taxman have no sense of decency? [ male announcer ] this is the story of the little room

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well, it's not just middle american tea party groups getting ecial attention. the i.r.s. is now reportedly targeting a conservative gup in hollywood that has celebrities like kelcey gramar, gary sinese and jon voight. are they becoming the enforcement arm of a hollywood blacklist? >> it's a trend to become acceptable or encouraged to

attack conservatives. we have saw this with the war on women and i.r.s. targeting and wee seen it recently. i think it's unfortunate because we are a big country. different value and perspective. that the america would be pitting americans against one another is something horrible. >> this is targeting by the i.r.s. that is unacceptable. >> you don't know that it's targeting because they are a new organization filing for the first time for the 501c3. >> rick, we saw the i.r.s. inspector general go through all this and he said there was targeting. 100% of the tea party groups were targeted. >> talking about one group. >> how many liberal groups were targeted? >> 25%. >> in hollywood? >> in hollywood, very few liberal groups in hollywood are 501c3s. if you look at this, the biggest liberal groups in hollywood are non-profits that never asked for the tax break.

this group did. by the way, you know, the whole thing about hollywood having a great prejudice against conservatives, look at the list. kelsey gramar is working constantly. jon voight won the golden globe. >> the i.r.s. wanted the list of names of contributors. a lot of pele i know in hollywood, conservatives, not a lot but a few who don't want their names out there and think they would be blacklisted if their names were out there. >> in the mccarthy era, they still went after you and you got black balled. this is a chilling effect if you know you're in the crosshairs. people say i won't take the risk. >> joe mccarthy wanted names. we have want names. isn't that the same thing happening now? >> i think so. i would point out i would be just as mad if the i.r.s. were targeting liberal groups. to think we can we form this or fix this is the triumph of

hope over experience. the i.r.s. is a politicized institution. the only fix is to abolish it. >> the inspector general said our audit didn't find any evidence that the i.r.s. used the progressive identifyer as the selection criteria but 100% of the time they targeted the tea party patriots. 9-12 groups. >> there is targeting. we need a special prosecutor. if janet reno has a special prosecutor to look in to white water, this is calling in to the questioning the credibility of the u.s. tax code. that is dangerous. >> special prosecutor? >> we need one because the government won't investigate itself. >> especially the i.r.s. >> why the promises obama made about healthcare in the middle class may come back to haunt him. that is ming up on "cashin' in" in five minutes. but first, the stocks heating up as another deep freeze

bears down on the u.s.

♪ our time is short ♪ this is our fate ♪ i'm yours we're back with stocks catching fire. emac? >> these are strong companies, i like it, a nice save play. >> john, you like it? >> i like funds that reflect the markets. >> but you like goldman goldmans

where you used to work. >> i do. >> good or bad? >> i like it. >> have a great weekend, everybody. keep it right here. the number one business block continues with eric band "cashi" oh, what a tangled web we weave when first we practice to deceive. >> you will be able to keep your healthcare plan, keep your doctor. >> we don't have a domestic spying program. >> with more promises expected at this tuesday's "state of the union" address. critics asking if the pa makes it impossible to trust any new presidential pledges. plus -- >> this is about freedom of speech. >> a film festil telling fracking filmmakers to frac off. why the out-of-control tactics could cost you. controversy before the super bowl. the nfl doesn't pay a dime in