>> this sunday, the president signs financial regulation this week as part of what the administration calls recovery summer. but where are the jobs? the fed chief says the future is uncertain. will things get worse before they get better? plus, how washington's debate about your taxes will affect economic growth. it's all part of my one-on-one discussion with treasury secretary timothy geithner. then, the rush to judge agriculture official sheryly sherr sherrod. >> this is a good woman that's been put through hell. and i could have done and should

have done a better job. >> how did we not ask the right questions? how did you all not ask the right questions? how did other people not ask the right questions? >> what does this episode say about racially charged politics, the media and the post-racial presidency of barack obama. our round table weighs in. president of the national urban league, marc morial, anita dunn, a man credited with sparking the tea party movement, cnbc's rick santelli and "the new york times" columnist, david brooks and "the washington post" columnist e.j. dionne. good morning. a summer of anxiety over jobs, the economy and government borrowing as new polling shows president obama's job approval rating handling the nation's economy at a new low. on friday i sat down with the

the administration's top economic official, treasury secretary tim geithner. mr. secretary, welcome back to the program. thank you for having us down to your office. >> good to see you, david. >> i want to ask but some of the broader economic outlooks that we've heard across the spectrum this week. an important one from the fed chairman, ben bernanke, who said the outlook is unusually uncertain. i wonder if to you, to the president, do you fear that things are going to get worse before they get better? >> i don't think there's anything unusual about the fact that given the severity of this crisis, the recession, how bad it was just 18 months ago, that americans are still living with some caution, some sense of caution about their future. that's natural, unavoidablunavo. the economy has been growing for more than a year. private sector is creating jobs again. the economy is starting to heal again. you see growth in manufacturing, private investment recovery, those are encouraging signs but we live with a lot of challenge

because of the scars of the crisis ran so deep and most americans understand it will take time to heal this. >> unusually uncertain. there's the prospect of a double dip recession. there are economists who have said you don't normally see this kind of anemic pace of recovery once a recovery begins. >> i disagree slightly. remember, this was a recession caused by a set of policies that left us with a 1. trillion de deficit when the president came into office. the recession was a year old at that point. given that we've been living beyond our means as a country, americans borrowing too much and a huge growth in risk taking and leverage in the financial system, you would expect a moderate pace recovery and that's what we're seeing. you are seeing recovery. you see private investment expand again. job growth starting to come back. and that's encouraging. if you look at what private forecasters say about the

economy, they see an economy that will continue to grow, strengthen moderately over the next 18 months or so, and i talk to businesses across the country and i would say that's the general view. an economy that's gradually getting better. >> you do not believe in a double dip recession that it will get worse before it gets better? >> i think the most likely thing is you see an economy that gradually strengthens over the next year or two. you see job growth start to come back again and investment expanding, manufacturing getting stronger, exports better. those are encouraging signs. we have a long way to go. >> you see this magazine i have. the headline is where are the jobs? the recession is over but no one is hiring. why is particularly private sector hiring apparently so slow? >> i think businesses across the country -- again, faced with prospect of an economy falling off the cliff are still cautious. still very cautious. they have been trying to get as much productivity out of their employees as possible. they're in a very strong financial condition and that's very promising.

a lot of pent-up demand and a lot of capacity for them to step up and start to invest and hire again. we've had six months of private sector job growth. not as fast as we like or as fast as we need but you'll see it again gradually start to get better. >> why are businesses uncertain? is it because of what's happened in europe and greece and other places? in other words, businesses are making money. they have cash. they don't seem to want to invest again. >> most important cause is scars caused by the depth of the crisis and what it did to confidence. people got worried about europe in the spring, it did hurt confidence. you saw prices fall around the world. that had an affect. i believe it's a temporary factor. europe has moved very aggressively and they are starting to get more confidence back in europe that they have traction on policies and put this behind them. >> you still have both the political and economic reality of this headline. where are the jobs? the political and economic reality is that most americans based on a variety of polling do

not believe the administration's claim that the stimulus made things better rather than left things largely unchanged. and the criticism is primarily from the left that the stimulus was never big enough to really match up to the severity of the crisis. why not stimulate more? why not spend more to do something to create more jobs? >> there's a lot of stimulus still in the pipeline. you saw congress move this week to expand unemployment benefits. the senate is about to consider a very powerful package of tax cuts for small businesses, help small businesses get access to credit. that's very important. and we think there's more things congress can do to help reinforce this recovery. we're in a transition from the extraordinary actions the government had to take to break the back of this financial crisis to a recovery led by private demand. that transition is well under way. it's going continue. it will strengthen. >> you're not prepared to say that more public works government spending is necessary. >> we have a lot of challenges left as a country ahead of us.

very high rates of unemployment. we want to make sure we strengthen the competitiveness of american companies across industries and we have long-term fiscal problems that will be a challenge for us as a country and we'll work to fix those problems we inherited but the best way to do that is to make sure we're growing private investment comes back and private firms hire again. the government can help but we need to make this transition to recovery led by private investment. >> you say government should take its foot off the accelerator of stimulus. >> we've already moved very aggressively to unwind and walk back the emergency measures we had to put in place in the financial sector. those were effective bringing down the cost of borrowing. bringing private capital in. that was the right thing to do then. we dialed those back quickly. we think there's a case with government helping small businesses and help states keep teachers in the classroom. we have to make this transition to a recovery led by private

companies. >> you talked about extending benefits to the unemployed. when the president did that back in november of last year he trumted the fact it was paid for and would add to the deficit. the complaint from republicans is no promise here. this will add to the deficit. why was it important then to make sure it was paid for then but not now? >> this is a responsible way to do it. my job is to help make sure we can borrow to finance the obligations congress gives us. it's a prudent, responsible way given the scale of the emergency, the scale of the damage still facing america, that we finance these additional support for the unemployed and the support for small business. we want to do it in an overall fiscally responsible way. as you know the president proposed a series of measures that would cut our deficit in half over the next several years. that's important for future growth. we'll make sure we get that balance right. >> it was important to be paid for then but not now. >> we can afford to do it this way. i'm completely confident we can. if you look again a what we pay to borrow now, we have very low

interest rates in the country because people around the world and americans have a lot of confidence in our capacity as a country to make sure we manage -- >> the argument cited for those that say the government should spend more because the cost of borrowing -- you just made the point. it doesn't cost a lot to carry the debt right now. why not spend more to create jobs when they don't appear to be materializing from the private sector? >> it's a difficult balance. again, we are proposing to make sure we extend tax cuts that go to 95% of americans. we extend a bunch of tax incentives to business to encourage hiring and investment. we can afford to do that now. we have to make some choices too and make sure that we can continue to earn confidence around the world that we're going to have the will as a country to bring these large inherited deficits down over time to a much more manageable level. >> let me talk about achievement of financial reform legislation that you work sod hard on. the pay czar ken feinberg is

working on compensation issuing you a report saying at the height of the crisis you had the biggest banks paying bonuses that were not warranted. do you have way to get that money back? >> congress did not give him the authority to do that but they gave him authority he used effectively to change how wall street was paying its executives and he did enormously important job to make sure we have in place ways to make sure these guys don't go back in the future, don't go in the future back to paying executives to take risks that could imperil the stability of the economy. he did a great job. he used that authority very well. >> the issue is are we fighting a lost war on financial reform? how do you look at this regime of new regulation and say there's a wait and see aspect to this because we don't know what the next time will look like. >> that's the strategy reflected in this bill. the best way to make sure we're protecting a financial system from future crises -- we won't

know the source -- to make sure the system runs with thicker shock absorbers and much stronger capital buffers so that they can withstand the kind of shock losses you face in a recession like this. that's the most effective thing you can do and this reform bill gives the government authority it did not have to make sure the system runs with these much more conservative constraints and risk taking. >> some concerned about the overall growth of the economy, the role of education, innovation, manufacturing, does it trouble you that 25% of our economy is the financial sector which doesn't actually make anything besides money? >> i don't know how large the system is going to be in the future. you can't really tell. what we're determined to do and what reforms will do is make sure the system goes back to its core purpose of taking savings of americans and from investors around the world and allocating those to people with an idea. not just the largest companies in the country but to small

businesses with an idea and plan for growing. that's what systems have to do well. our system at its best was the model for the world in doing that. and these reforms make sure we preserve that basic strength. >> a couple questions about housing and taxes. the the housing market is still in a lot of trouble. it was propped up with mortgage modification, with the tax benefits of buying a new home. that's now gone home. home sales have gone back down. modifications have not met the goal of avoiding 4 million foreclosures. i'm curious whether you and the president are committed to three critical areas. the tax credit for mortgage interest, the credit provided by fannie mae and freddie mac, and the housing goals particularly for low income americans. are you still committed to those three pillars? >> we want to make sure that we do what is necessary to make sure americans have the ability to borrow, to finance the purchase of a house.

we bring stability to house prices. we help prepare the huge damage done by the housing market and you still say it's in a lot of distress. we brought a measure of stability to house prices. interest rates have come down dramatically. millions of americans have been able to refinance and take advantage of lower rates which is much more money in their pockets and we've put in place a very carefully designed mortgage modification program to help people who have a chance to stay in their house take advantage of that chance. now, we'll make sure we continue to do what's necessary to again repair the damage of this housing crisis but we have to reform the system. we have to bring to fannie and freddie and to the broader housing finance market a better set of policies to make sure we can deliver affordable finance for housing without leaving the economy vulnerable to this kind of crisis. >> the housie ining goals which big part of what fannie and freddie were doing guaranteeing the mortgage debt out there in the country and the government has taken them over and they were private here to for.

but is it a goal of getting people into homes, is that still the goal? that's part of the problem. you had had too people in homes that couldn't afford to be there. >> we'll look at a set of reforms good for the country going forward. i personally believe there will be a good case for the government preserving some type of guarantee to make sure people have the ability to borrow and finance a house even in a very damaging recession. there will be a good case for that. >> fannie and freddie should not be dismantled? >> we won't preserve fannie and freddie in their current form. we have to bring fundamental change to that market. we'll have a good case for looking at preserving or putting in place a carefully designed guarantee to homeowners have the ability to borrow to finance a home even in a very difficult recession. we're also going to have to look at the broad set of policies we put in place to encourage home ownership and low income americans get access to affordable housing. we'll take a very broad look at

how best to do that. we'll begin that process quickly and consult broadly and i think that there's going to be very broad support among republicans and democrats for a sensible reform to fix this system. >> let me go through quickly as i can the big tax issue. the bush tax cuts set to expire. the administration's plan is to let them expire. raise taxes on wealthy americans above $250,000. don't let them expire and keep them going for those $250,000 or less. even democrats, like chairman of the budget committee, says bad idea to raise taxes on wealthy americans until you have a recovery on sounder footing. any wiggle room on that? any prospect of change? >> it's not a fair description of senator conrad's views. the president believes and i believe this. the right thing for the country, the fair thing, the responsible thing for the country now is to make sure we leave in place and preserve tax cuts that go to more than 95% of working americans and complement those

with a set of incentives for businesses to expand and hire. to make that possible, and to do that responsibly, it is fair and good policy to allow those tax cuts that only go to 2% or 3% of the highest earners in the country to expire as schedule. the country can withstand that. i think it's good policy. >> would you like to see the capital gains tax stay at 20%? >> i would. we don't want to see the rate of dividends exceed that either because we want to make sure we have policies in place across the economy to make sure we're encouraging investment and encouraging growth as this economy recovers. >> if deficits are unsusta unsustainable, can you give an example of a painful choice the president is prepared to make to bring our house in order? >> he will freeze discretionary spending and keep the size of the government at a modest level. if you look at what the president is proposing, he keeps the overall size of government at a very modest level comparable to lower than in the

bush administration comparable to what president reagan presided over. that's very important. that's a difficult thing to do when we face so much challenges as a country. he's also proposing as you said to allow these tax cuts for the highest earners to expire on schedule. he's proposed to reinstate a bunch of disciplines that produced surpluses of the clinton era. and those policies will bring our deficits down by more than half over the next several years. >> final question, the president talked about the fact that like a lot of americans saving for their kids education, his 529 or college savings plan for his daughters has gone down in value. a lot of people think about it. >> it's come up dramatically. >> okay. but this is serious point. a lot of people think about this and about investing in the market for the future as you passed a financial regulation. what is a fair expectation for americans to have out of the capital markets if they see that as a place for savings when we

heard you'll get 10% to 15% returns over long-term. is that what americans can expect? >> i think what they can expect from these reforms is much more assessable, much more simple, much clearer disclosure about the terms in which they can borrow to finance education for their children, borrow to finance a home and a car and credit card much more clear transparent simple disclosure than they had over the past several decades and more informing about the risks you take in investing. that's a sensible thing for the government to do. now, of course you need people to be able to make responsible decisions. we can't make those decisions for those individuals. they have to take that responsibility themselves. >> hasn't the world changed in the markets that you can't expect to get the kind of return on investment that you've enjoyed for so many years? >> it's hard to know. what you want people doing is making better decisions and more careful decisions about how much income they spend and how much they save and what they use the

savings for and how much they borrow. i think the trauma caused by this crisis is going to be profound and long lasting and you are already seeing it induced ultimately healthy and necessary change of behavior because people are saving more of their income. that's good for the country. coming up next, the rush to judge shirley sherrod. what happened and why? the politics of race and what many thought would be a post-racial era. our roundtable weighs in. the marc morial, anita dunn, rick santelli, david brooks of "the new york times" and "the washington post" e.j. dionne right here only on "meet the press." we know why we're here. to chart a greener path in the air and in our factories. ♪ to find cleaner, more efficient ways to power flight.

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discussions about race supposed to get better in the obama era? >> reporter: it was during the presidential campaign of 2008 that senator obama set an example for how to discuss race. he had to explain controversial remarks his former pastor wright made from the pulpit. obama's point -- you are to put someone's views in the context of their life experience. >> even for those blacks that did make it, question of race and racism continue to define their world view in fundamental ways. for the men and women of reverend wright's generation, the memories of humiliation and doubt and fear have not gone away. nor has the anger and the bitterness of those years. >> reporter: ironically, that is is exactly what sherrod was trying to say in the speech that was edited to make her sound like a racist. her point was that she once held prejudices but found a way to overcome them and help a white farmer in need.

>> this whole incident helped me to feel a little more that we seem to be going backwards instead of forward. in items of race relations. >> reporter: a teachable moment? >> i think a teachable moment is a moment in which the facts change and you react to the different -- those different facts. i think this one of those moment. i think that's what happened. >> reporter: still, this was not the kind of internet and cable news-fed spectacle the white house wanted to see, let alone be part of. while it's trying to get americans back to work and while the president was signing a major piece of financial reform legislation. and it wasn't the first time the white house has been thrown off track. one year ago another racially charged incident, after the arrest of harvard professor henry louis gates jr. the president reacted. >> i think it's fair to say, number one, any of us would be pretty angry.

number two, that the cambridge police acted stupidly. in arresting somebody when there was already proof they were in their own home. >> reporter: and then later expressed regret for a poor choice of words, he said, and for ratcheting up the controversy. then there was a summit over a beer. what now? change comes slowly, observers say, and only if moments like this are used to teach. >> we measure race relations in baby steps, not giant tepz. that's why it's taken us 300 years of salavery and 100 years of jim crow to get to where we are. >> reporter: back in 200 senator obama was humble about how his election might impact race in america. but he was adamant about one thing. >> but race is one issue i believe this nation cannot afford to ignore right now. >> yet, if we're not ignoring it, the question s are we talking about it in a way that

anyone would think is actually constructive. i'm going to pose that question to the roundtable. joining me now to discuss all the angles of this, as well as the entire political landscape, former obama white house adviser anita dunn, cnbc's rick santelli, national urban league marc morial, e.j. die i don't know. welcome, all of us. marc morial, is the conversation, as race always is, became emotional, politically charged and it happened in a heartbeat. to my question, are we better off for this experience? are we having a constructive conversation about race in america? >> if we take the proper positive steps coming out of this experience, we can be better off. three thing i observed. one, don't forget that this started when mr. breitbart threw a fire cracker in a crowded room. >> the conservative blogger andrew breitbart. >> he threw a fire cracker in a

crowded room, doctored a video which caused an innocent, hard-working, responsible woman, whose story was of racial reconciliation, to be cast in a negative light. and then it began from there. so, that's certainly an important takeaway. the second important takeaway is the story of shirley sherrod and the spooners. th it is a story of reconciliation, a woman who was willing to admit that she had worked to overcome it. the third thing i would say, david n washington, the urban league will have 10,000 people here for our centennial conference. we'll are a constructive conversation about race and jobs, race and health care, a constructive discussion. and i'd invite people to follow that discussion this week. >> and the president will be speaking there, correct? >> the president will be there, secretary duncan will be there. we have tim kaine and michael

steele. we've got business leaders. we have a bit of a mix across the spectrum who will be there to talk positively about the pressing issues that face the country. >> anita dunn, you worked in the white house as adviser on communications matters. i want to get your response to maureen dowd's comments in "the washington times" because she has sharp words against clyburn. i don't think a single black person was consulted before shirley sherrod was fired. i mean, come on, said congressman clyburn of south carolina. he needs some black people around him. he said obama's inner circle keeps screwing up on race. some people over there are not sensitive at all about race. they really feel the extent to che allows himself to talk about race would tend to pigeon hole him or cost him support when a lot of people saw his election as a way to get the idea behind us. i don't think people elected him to disengage on race. just the opposite. the president shouldn't give sherrod his old back back. he should give her a new job,

director of black outreach. the white house needs one. those are strong words. >> those are strong words, david. i think there are a lot of people who look back at the last week and wish they had behaved very differently. i'm sure there are plenty of people in the news media who stopped and thought about the fundamental yjob of journalism. i think that the naacp wishes they had not moved as quickly as they did. and i don't think anybody is saying the naacp, you know, needs more african-americans and heaven knows that tom vilsack, who has taken responsibility and who has said how badly he screwed up and the white house, which knows how badly they screwed up, have moved. but i think there are a couple things here. one is that this extraordinary screwup happened. it was bad. the white house and vilsack moved quite quickly to fix it. that's what people need to do

when they make mistakes. the broader question is how is this suddenly barack obama's problem? he has written an entire book of race. he dwoets an entire chapter. he made the speech in 200 8 -- he has probably -- >> is there a skiddishness about confronting problems when they spring up like this. however, whether there were screwups made, to deal with them head-on. >> it's funny to head-on. >> it's funny to me. this resulted from a false narrative that was developing last week. as you recall, you talked about context and president talked about context. the context for this was not that andrew decided to put an edited video to make a point. he was trying to make the point that the naacp is a racist organization so let's start with that fun box here. then the week before that, the naacp had a resolution that called on the tea party movement to expel from its group anyone

that harbored racist sentiments. >> this is the broader context. let me bring you in, e.j. the obama team was reacting to a reality, the bludgeoning of mainstream journalism -- what do we take from this? >> that's my column tomorrow. first of all, you asked a good question. can we have a good discussion on race? we can't if the facts don't matter. it's not only that shirley sherrod was smeared, if you look at that speech she was giving a speech about racial reconciliation. she said poor whites and poor blacks have a lot in common and this was twisted into an allegation, false allegation, that she was somehow a black racist. what's going on

here? traditional media are so afraid of being called liberal god forbid they be called liberal that they are willing to run with any kind of right wing propaganda and treat it as news. running or taking your time before you run with a story is not liberalism. that's journalism. i think the right has been running the campaign for 30 years. they've had a lot of success. we should worry about it. look over both shoulders and the facts. >> there's a squabble culture out there. there's regular media. we were give an phrase if your mother tells you she loves you, check it out. so that's it. you would never run an exert from a speech unless you checked it out. they don't know anything about policies and don't care about

government, they just want that squabble. my rule is stay away from squabble culture. don't get in there. >> that's easier said than done when the white house press secretary walks into the room and the only question people want to ask is how are you going to react? what are you going to do? what are you going to do? you have an edited speech that was designed to create this outcome that becomes "the news of the day." >> before firing someone, call them up and talk to them. >> i want to bring you into this, rick santelli. there's a political dimension of this. naacp making the charge against the tea party. the tea party responding in kind by going after sherrod. eugene robinson wrote this in his column. there's a flurry of charges from

substantial conservative figures about racism against whites by blacks and other minorities. the allegations are being hyped and exaggerated because they are designed to make whites fearful. it won't work with most people but it works with some. enough perhaps to help erode obama's political standing and damage his party's prospects at the polls. this is a political strategy. >> first of all, we should have zero tolerance for racial discrimination period. beyond that, the indirect question is the tea party racist, the real question are there racists in the tea party? i would contend that there's going to be racists in any group. the tea party is more a thought and feeling and philosophy than a party. i think in february of '09 when i was the lightning rod for this movement in many ways, many different diverse groups of people from all walks of life,

all races, all from different areas of the socioeconomic spectrum all intersect in an area that's philosophical. i think the issue is fiscal responsibility. with that there's a less spending issue. less spending affects entitlemen entitlements. if you connect the todots, the a party represents that we can control spending and have good strategies without negatively impacting minorities which are higher proportion of the programs that are affected by spending. >> marc morial, i want to bring you in back to this question to what congressman is saying that there is skittishness and not wanting to get close to it. you heard the president in 2008. we can't ignore it. >> the president would benefit from a broad circle of external advisers and maybe some internal

advisers who have the experience particularly in the south contemporary experience of the civil rights movement that could serve as a sounding board and i think that this president would benefit and every president would benefit by having those type of people, those experiences in his circle of advisers. the second thing i just want to say is to what rick said. what i saw from the tea party and this is what many of us reacted to were the ex-purgss of congressman lewis and awful billboard refute ated now which compared our great leader with two of the worst figures in 20th century history. i asked myself, would i ever have seen a president bush, a.

cli president clinton, a president nixon portrayed in that way? >> there's extremists on the left. there are movements that have people that go way beyond that on the left and right. >> the point i made in that column was going back in the 1960s when folks were burning flags, mainstream liberals were asked to repudiate flag burning and they did. they made a very careful statement where they said there's racism in the tea party and -- look, there is a concerted conservative campaign on part of the movement. minority of the movement to use race. going back obama has a deep seeded hatred for white people. jay christian adams pushing this

new black panther story says the obama justice department is motivated by a hostility toward equal enforcement of the law. there are people playing with this racial politics out there. i'm not saying naacp isn't saying this is the whole conservative movement or most of the tea party but it's a part of this strategy and people should condemn it. >> there are liberals that call conservatives racists. it happens. i was out jogging at a tea party rally and also there was a black family reunion celebrating african-american culture. i watched these two groups intermingle watching concerts together. among most of those people there was a fantastic atmosphere of getting along on a warm sunday afternoon. i was struck by a story of progress. a story of progress that we're making progress to this and this whole week the speech was about progress. we have a gotcha culture that

punishes people for saying terrible things. >> let me add into the mix here this week came senator jim webb, a democrat, virginia, who wrote an op-ed piece that raised a lot of eyebrows. we'll put the headne on the screen. diversity and the myth of white privilege that america owns a debt to black citizens but government programs to help all people of color are unfair. they should end. even those in the democratic party say we have to have a real conversation about these issues. >> i don't think there's anybody that says we shouldn't have a real conversation about these issues but there's nobody at this table or frankly most people in america who think that an edited 2 1/2 minute clip that begins driving the news and has reporters saying how will the white house react, it's a huge problem, will they fire her? what are they going to do? that's not a reason conversation. a reason conversation is what the president has tried to promote throughout his career

and that he's said we need to have. let's not mistake what's been going on over the past week for any kind of reason conversation. there was a rush to judgment on shirley sherrod and based on another false idea that somehow barack obama is the president with race relations in america or the reason we don't have a conversation. i don't think that's true either. >> i want to say this. one of the things this distracts from is the news of the week that the senate cut out $1 billion for summer jobs but prepared to spend $60 billion on a troop surge. the repeated use of filibuster to block legislation and block measures that would help the economy and urban communities. that to me and the persistent use of the filibuster being used more times in the last two years than in the previous century to stop this legislation -- >> i want to get your reaction to jim webb's point in his editorial. >> i don't agree that latinos

and asians have not suffered discrimination in this country or that native americans have not suffered discrimination in this country. i think the question is how do you target a policy that will help all economically socially disadvantaged people and it's a fair debate to have but it also needs to be positive with facts. look at the latino unemployment rate. it's higher than the white rate. black rate is higher than latino rate. to suggest that there are not disparities that affect the latino community and affect the native american community and the african-american community, we need to have the discussion jim webb wants to have with facts. real facts that give a picture of how life is. >> 41 cents of every dollar this government spends in fiscal 2010 goes to pay debt of borrowed money. 41 cents of every dollar. we have a $3.5 trillion 2010 budget. let's look at that 34 billion for extension.

these people need help. but to think that this administration and in timothy geithner's interview he talks about getting fiscal house in order in a $3.5 trillion budget they can't come up with a way to offset 40 billion in spending. at the end game in the country is broke, everybody loses. >> we'll take break here. we'll pick up talking more about the geithner interview, the economy and politics in our remaining moments with our roundtable. don't go away. can i have some ice eam please ? no, it's just for new people.

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>> we're back with our roundtable. so much time to get to and not enough time. s santille is setting it up. let me show you a couple things. a poll from bloomberg about a week ago asking if you are better off than 18 months ago. 17% say yes. worse off 29% about the same,

54%. that's after the stimulus plan. ron brownstein in his column says this in the political context. polls suggest that an energized core of voters around 40% has recoiled from obama's direction that threatens democrats but voters open to an activist government in principle are not convinced it is producing enough benefits in practice. government has not proven to be the answer and yet that's the fundamental argument from the administration. >> there's been a massive recall in the past year. the obama administration dropped 20% among independent voters because of the debt and other issues but faith in government plummeted to its historic lows. faith in congress is weak. so how do you persuade people that you can do things when you have that kind of distrust and that hasn't been solved? the stimulus obviously created some jobs but the fact is it's taken forever to get out and the underlying reality is the more the debt goes up, the more people are scared and the more

they're scared, especially small business, they're not investing. >> rick santelli, in the liberal argument i brought up to secretary geithner to challenge your point of you, wait a minute. you are raising the red flag about debt. they are unsustainable. the cost of borrowing money right now is so low that when you're in this kind of circumstance economically why not measure spending xhez rat with the size of the hole you're in. >> people do good prices in the early days. i don't think it's a great idea that we can sell so much debt because it could change quickly. at the end of last year a greek six-month monday was around 2%. it's more than doubled. >> we can print money. >> we're not greece yet but that could be the ghost of the economy of the future if we stay on this unsustainable path. there are some of us that don't

believe the stimulus or recovery package or the t.a.r.p. did what it sold. my opinion would be that what we've done is create a six-day ti cure for a three-day flu. >> front page of the morning papers today "the washington post" front page battle looms on tax breaks as bush era cuts are at issue. "the new york times" next big battle in washington, bush's tax cuts. if the administration is serious about cutting the deficit, why keep any of these tax cuts going because extending tax cuts to middle class, those 250,000, $100,000 or less will cost $250 billion to do next year. >> david, the president was very clear as a candidate in 2008, as president in 2009 and 2010 that the middle class in this country pays enough in taxes and should not have a tax increase. he believes that they are

stressed enough and that they lost ground over the last decade and that he's not going raise taxes on them. he was very clear. >> let me stop you on the issue of tough choices. it's tough to say to the american people i know you pay too much but i can't do it now if i want to be serious about the deficit. why not say to the american people, you have to sacrifice. we have to get rid of tax cuts if it's about idea which is what democrats believe that tax cuts were a bad idea. >> democrats didn't believe all those tax cuts were a bad idea. there were battles in 2001 and 2003 to double the child care tax credit, to make the tax code more progressive at the bottom end. they didn't believe all of the tax cuts were a bad idea in 2001 or 2003. what they did believe and continue to believe is that the very, very highest end and people who do the best, 2% of the 300 million in this country, that they can pay a little more during this time. in terms of the deficit piece of

this, the president is absolutely convinced and is taking steps. there is a bipartisan deficit commission that i know if washington bipartisan commissions come and go but this is a very serious effort. they will come back with recommendations. there will be tough choices in there the president has directed his cabinet agencies to cut spending. there will be tough choices in there. there have to be. everyone recognizes that. >> i have three minutes left. e.j., you can weigh in on that. i want to show that the president spoke to net roots conference over the weekend. this is developing story about the obama agenda and the left. >> we have begun to deliver on the change you fought for. we're not done. we're working to repeal don't ask, don't tell. we're working to close guantanamo in a responsible way. and thanks to the heroism of our troops, we're poised to end our combat mission in iraq by the end of august. completing a drawdown of more than 90,000 troops since i took

office. we're moving america forward and when we've come this far, we can't afford to slide backward. >> what's striking about that is the president has a problem with independent voters but he has those on the left who are disappointed. >> that's the important of the outcome of the election. one thing on this tax issue. warren buffett said that he pays tax at a lower rate than his receptionist because of the way we tax dividends and capital gains, truly rich people in the country according to a study last year, 400 richest people, pay taxes at a lower rate than firefighters, than police officers, than shop clerks. that's why we need to raise taxes on the very wealthy to cover the deficit. guess what? the tax increases on the wealthy do not have an anti-stimulate effect. barack obama was smart to do that. he needed to do that. democrats will be in trouble if their own people don't turn out. right now rick santelli's tea

party mass motivated a lot of people on the right. administration and democrats have to do a lot more motivating on their side. >> let me get your thoughts about fiscal responsibility but save me 30 seconds to talk about charlie rangel. >> my view of fiscal policy and the economy is not that strong. you can pump a lot of money and won't get short-term buzz and think long-term. what can we do long-term to get fair taxes, simple taxes, structure, innovation. i think the idea we'll fix the economy on fiscal policy on the next six months or a year is hellacious. >> last time i walked through streets of harlem charlie rangel has incredible support. let's not prejudge charlie rangel. he has a right to be heard and we need to hear his side of the story. he's a great congressman and great american. >> anita dunn, the last thing democrats want right now is full

airing of ethics charges against one of their members when congress rates at 11% approval. >> you're arguing it could go lower? i think that we have to think about what marc morial just said. the reality is we should listen to him in context before we judge. >> all right. we'll leave it there. thank you all. pretty spirited discussion. we'll be right back. at oppenheimerfunds, our fund managers' perspective on the numbers helps uncover opportunities no matter which way the markets are moving. ask your advisor about oppenheimerfunds. call your advisor for a prospectus with complete fund information. read it carefully and carefully consider fund investment objectives, risks, charges and expenses before investing. mutual funds are subject to market risk and volatility. shares may lose or gain value. oppenheimerfunds. the right way to invest.

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>> that is all for today. before we go, a quick programming note. tune into nbc tonight at 7:00 p.m. eastern for the "dateline" special with ann curry. "america now friends and neighbors" it will study the impact of the recession on the poor. we'll be back next week. if it's sunday, it's "meet the press." ♪

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