can see the stacks that we had to deliver. >> a tough job. >> and she's my intern. >> unpaid intern. >> take the credit and also didn't get accepted to mcdonald's. >> i'll tell that story in the after the show show. >> see you, everybody. >> brenda: we interrupt your summer fun for a summer jobs bomber. america's biggest job creator saying uncertainty is keeping them down and holding them back from hiring. this, as tax hikes loom over a reported 1.2 million small businesses, did our only hope of jobs recovery just go off the radar? hi, everyone, i'm brenda buttner, this is bulls and bears, here they are, the bulls and bears this week. and welcome to everybody. okay.

john, you're a small business owner, but the president says that the tax hike that he wants for those making more than 250,000 will only affect a very small percent of small businesses. so, no big deal, huh? >> this is a big deal, brenda and really, what the president doesn't tell you in that is that the small percentage of companies that are generating most of the production and consumption from their employees, so, it's very uncertainly for the smaller businesses to not know what their health care costs are going into next year and also, possibly be saving a looming tax and increasing expenses, when businesses don't have certainty, they're paralyzed. i'm a small business owner and right now companies are looking for stability and they don't have any stability when are they are uncertain what the future costs are. >> they say so many small business owners are pessimistic, you are a small business owner, are you? >> i'm not--

my business is not really affected by the world economy, i'm a political media consultant. >> and-- you've got plenty of work. >> there's never a recession in politics, that's right. but there's pessimism out there, there's no question about that, we see that in all of our polling. businesses wonder what's going on with the world economy and wonder whether we're going into a double dip. we're obviously in a slowdown, a worldwide slowdown and the brics have slowed down and india and china have slowed down. idea raising taxes on individuals who make more than $250,000, 500,000 for a family is going to affect hiring is false, phony. i hire people to make more money, period. and-- >> okay. gary b, you're not a political consultant. are you pessimistic and what does it mean to people who

are, who should be hiring in america? >> with well, brenda it's not good. let's get where the obama tax hits. >> it hits 3% of the small businesses that are doing the bulk of the hiring, making the bulk of the revenue and pay the bulk of taxes and hits them scarily as john alludes to. so, they have the taxes going up on the quote, unquote rich. you have the obama health care taxes and by the way, captain gains taxes are going up. wait a second, is it worth it to me to hire the people and buy the equipment. i'm sure he's buying big turbines, stuff like that, but small businesses do that, but let's look what the survey says, despite what steve says, i mean, he has a great business and that probably is recession proof. most small businesses surveys said, hey, wait a second, we're going to cut back on hiring, and cut back on buying

equipment. so, we either now have two choices, either it's true that the economy's going to collapse because of the taxes or these people are outright lying, i choose to believe the former. >> could it be there's a lack of demand worldwide, people aren't buying and so, small business owners can't hire, they can't buy new turbines or whatever. >> it's the number one reap for lack of hiring, lack of demand on products, the number one answer in the survey. the number two answer would probably be forecast for the future, people who run businesses, they don't think it's great with a looming tax increase and i would say that by saying they won't pay and pay off the moss seive deficit right now and i also think that ultimately it comes down to demand and the notion that we always have, seem to always have exspiring tax cuts the last five or six years and it's not a great way to run a

tax program because you're thinking the tax cuts are going away and might be not demand and better not hire somebody nowment it would be better if we had a smaller tax to pay for with spending cuts than one we can't afford and pretend it goes away and show a balanced budget over 20 years. >> brenda: a shootout, but toby. >> the number is $250,000 per family not 500,000, the first issue. the second issue, 91% of all the taxable income for small businesses comes from 1.2 million businesses, it's not like it's not a consequenceal number. if are' going to the i'm sorry, life's not fair, 1.2 million of these small businesses, account for 91%, when you raise those taxes 4 or 5%, they go up 2% at the state level and all of a sudden. you may hundreds of billions out of the system and that hurts the economy and hurts jobs. >> so, it's not 500,000, it's 250,000, does that change your answer? >> no, not at all.

the decision by businesses is made on profits, period. not taxes. how can i make more money. if i hire this man or woman, will that help increase my profits. >> brenda: don't taxes take off from your profits? they erode your margins, don't they? >> or, hey-- >> 4%. >> it's just not 4%, steve, it's state plus federal. in your area it's d.c., adds up to 8 or 9% and that's cash money, and-- >> these are the clinton tax rates, we have under clinton, it's not the taxes. >> brenda: let's let john go ahead. >> as a small business owner who isn't a political consultant, i can say that most small businesses, and my peers, when we speak about business right now, everyone is looking to hold on to the employees they have, so that they can keep up. okay, we're at capacity utilization, all time highs people are trying it keep the

people they have working as hard as they can, but when you look and don't know what you're going to spend next year, you're not going to consider hiring, but you will consider if it affects your own personal income getting rid of one person, or putting one person that 4 or 5% adds up on 1.2 million businesses. gary b? >> i want to get back to you. steve, i think that jonas made the one point that companies hire based on, are they going to make more profits? that's true, and they remember from accounting 101, those profits are translating into retained earnings which most companies plow right back into the business. so, if before your profits were $2 and now they're $1 you only have $1 to plow back into the business, that means you're going to have to hire less people, open one fewer restaurants, buy less, and it might not affect it upfront, but down the line. >> that's the margins. >> and that's the tax--

>> i'm going to jonah, whate ta. >> france is proposing a 90% tax rate and it's their fault. >> people moving to london. >> a crazy example, not satisfying good -- high taxes are good. the end of the day people are not hiring a $50,000 employer because it's going to increase revenue $40,000, not going to make 50,000. as long as they can bring revenue up $50 and fire for somebody for 50, they are real or imagined they don't think they're going to cover the labor cost. the demand is not there with the products right now with the low tax rates including the payroll tax, that's the way it is. >> the right point is that the million dollar business, if i'm 10% less that's one employee i'm not only not going to hire i'm going to, 10% less profit and maybe get rid of one person to keep my profit where it was last year. it's at the margin, guys, where you make the decisions. >> you should do that anyway if you can do that without

changing your profit. and make more money that way. >> if you spend money and you invest in people so you can get future profits out of them, but when you don't know what your fixed costs are you don't know what it's to take risks that way. >> brenda: that's got to be the last word. that's it for the trading bit. general motors offering money back guarantees for brand new chevy buyers. neil and his crew are wondering where the money back guarantee is for us taxpayers still on the hook for that bailout. that's at the bottom of the hour. but up here next, with temperatures heating up, corn crops are burning up, as you hit the grocery store, is your cash back.

>> and good morning, everyone, live from america's news headquarters, i'm jamie colby. take a live look at andrews air force base, in minutes, president obama is set to head off another day of campaign events in virginia and expected to push his plan to

let tax cuts expire for americans making over $250,000. it was issue number one in his weekly internet address. ohio senator rob portman delivered the g.o.p. message. >> 98% of american families won't see their income taxes go up at all, but the other 2% of americans will have to pay a little more on taxes on anything they make over $250,000. >> raising taxes on jobs creators during a job shortage makes as much sense cutting off a water supply during a drought. >> tough times for america, stay tuned to fox where the news on the campaign trail today. i'm jamie colby, we'll send you back to bulls and bears on the fox news channel. have a great day. >> brenda: the worst drought in nearly 25 years drying up corn crops across america. that's threatening to drive food costs higher and consumers moods lower. sentiment dropping to the lowest level of the year. now, john, how much higher

could we see prices go? >> i would consider the consumer popped root now. joe main street is facing foreclosures, facing unemployment. facing potentially higher taxes like we talked about earlier and now, this drought is going to send your basic staples, corn crop, going to send your basic food staples skyrocketing and i don't think the american consumer can take another body blow. this could be hurtful and trickle into the other keened of price inflation. >> well, toby, it's the stock that corn goes with almost everything. >> it does, but thankfully the corn that we're using now was stored from six months ago, takes 90 to 120 days, number one, number two, the corn that's harvested right now is not harvested until september. so, is it going to hurt us this summer, no, are higher prices going to be higher for food, yes.

but guess what, gasoline prices are lower and offset. >> brenda: jonas, probably $5 a month, but go to you to talk about food inflation. cut down 2-1. i will say it's the hottest year ever happened last year or this year, would have been worse than this year, because every other commodity especially energy commodities are down and those are input in the production price of gas, fuel, transport, et cetera. so the consumer is not going to see this one yet. this is sort of like damage to the supply chain, it's worse to the consumer than real inflation caused by the federal reserve because your wages aren't going up, the costs are going up and that's actually, if it happens to a lot of products, and have serious droughts, the thoughts many years, all kinds of food prices going up and people can't pay for it more and in a lot of trouble and hopefully the end of it. >> and that's a good point. because the things that matter aren't going up, wages, housing prices and the things that do matter are, food,

people have to go and buy milk. >> yes, some people clearly are having a harder time making ends meet, look, and this is about for a democrat, what is that word, right, for a democrat, but we should not be using corn for ethanol. >> yeah. >> corn prices have generally been too high in recent years, ethanol, it's very inefficient when made with corn. it's much more efficient, six, seven times as much, they do this in brazil, made with sugar cane and we need to think big-- >> ethanol from sugar and-- >> and i've got a proposal here, let me finish real quick. >> brenda: and-- >> our trade relations with cuba and sell our products there, this will jump start the economy. >> and it will go there and-- okay, gary b. what is this doing to consumer prices? how high are they going to go?

>> you know, brenda, we have been talking about inflation armageddon for like the last six months and yet, i always look back at the numbers and i always said, it is just not showing up. inflation year to year is 1.7%, food inflation is 2.8%, i think it will have a little effect on food and-- that's higher than wages though. >> hold on one second, brenda. hold on one second, but i think it will have an effect on food inflation, but, remember, food is only 14% of the budget and as toby points out. other big areas have gone down, and gasoline year to year is down almost 15%, you know, so, right across the board, brenda, things tend to balance out and remember the other thing, we have so many more choices than we did in the past, even, five, ten years ago for people to switch. you don't like, the beef prices are going up. i know what you do in your family, you switch to pork or--

>> i never-- i love hamburger. >> you keep making those burgers, i understand. [laughter]. >> neil: . >> brenda: thanks, guys. something the former president did to reform welfare is about to change because of something the current president just did. now, you don't have to be on welfare to have this game changer impact you. [ male announcer ] at scottrade, we believe the more you know, the better you trade. so we have ongoing webinars and interactive learning, plus, in-branch seminars at over 500 locations, where our dedicated support teams help you know more so your money can do more. [ rodger ] at scottrade, seven dollar trades are just the start. our teams have the information you want when you need it. it's anothereason more investors are saying... [ all ] i'm with scottrade.

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>> coming up, waiving the work provision in welfare reform and who did it and who says the whole country will see red bec

>> critics are calling it the end of welfare reform as we know it. the obama administration leading it up to the states to

decide whether the welfare recipients have to work to get benefits and toby, you say this will unravel the one entitlement reform, that is actually working. >> where is clinton. you know, this is a program that works. thises an entitlement that we cut back and it works. i mean, we need one thing to point out that you can actually cut back on entitlements in in country and people aren't going to feel dying of starvation in the streets, but lo and behold, now you can use a smoking cessation class and that's working and i can do homework for my kid and that counts as working and this is-- >> hey, that's working. >> this is the entitlement mentality gone wild. >> and steve, you might actually agree with toby. >> how do i get the words out of my mouth? i agree with toby, this is polarizing, we need unity and

ask taxpayers having had a hard time to make end meet to pay for welfare recipients know the to work. the way you break the cycle of culture is not like this, et cetera with work and education. it's a great reform and should not be changed. >> jonas, there are interesting ramifications with this? >> and talking about-- they won't have to work, i'm not saying that's going to happen. someone else is going to fill that job and a little lowering of the employment rate. >> i'm not saying it's a good policy. i'm saying the effect-- >> i agree and i'll also say that this-- it's very small and this program is about two months of disability which i would prefer not to pay taxpayer money for because that expense goes to people that could be working as well and these

people are really for the small payment and you're giving the state more power to determine how they want to manage their welfare program. the federal mandate to work is really what you're talking about and concern about all four there. >> gary b, you're a conservative. are you for this? >> well, god bless jonas for help finding the silver lining. and finding the good point. >> not at all. >> thankfully he's on the show. the bigger issue, should we be doing it? historically, the government covers carrots or things they want to do. more deduction because they want you to own a home. they offer depreciation equipment they want factories to build more, you're offering an incentive for people not to work. even if jonas is right and the effect is zero, it strikes the american public as the wrong thing to do. as toby points out.

do we want people lying in bed making money? the answer is no, we shouldn't be doing it. >> brenda: john? >> and how far have we gone to becoming a european entitlement nation now? recently the world bank told the spanish government that their employees are on vacation and they get sick, they have to get granted more vacation. >> whoa. >> and viva, viva-- >> and quite a policy when you have people out there pounding the pavement, and the kenard in your earlier point, those people not in bed or taking smoking cessation courses might work a part-time job that might end in a full-time job. >> and okay. all right. and we've got to stop it now. thanks, guys and thank you to steve for joining us, we appreciate it. >> thank you for having me. >> brenda: so, ralph loren getting a lot of flak for its made in china uniforms. but we have the other all

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>> predictions, gary b. go for it. >> netflix, people are going to be using that streaming service to catch up on the breaking bad episodes before the season kicked off. i own the stock, love it, $100 by the end of the year. >> john, bull or bear. >> i'm a bear on that one. >> brenda: what do you like? >> it's golf season and see a quick quarter for nike and apparel and 25% up by the end of summer. >> brenda: another big golfer, toby, what do you think? >> and it's definitely breaking bad. they've already moved. [laughter] >> jonas, your prediction. >> one of the internet's early social sites, and the people say that's the end of the dot-com super bubble two and that's not vanguard information technology fund 20% in a year. >> brenda: gary