official kickoff of the 2012 primary season, and here at "the d.r. show," we have to ask, is this any way to pick a president? the entire country's essentially coming to a halt to watch what 120,000 voters do in the idiosyncratic state of iowa on january 3rd. that's like a single city the size of charleston, south carolina, playing a pivotal role in who your next president is. or allentown, pennsylvania, or surprise, arizona, or little lafayette, louisiana. take your pick. a martian visiting our democracy would say it's crazy. yet an iowa win will lead to national magazine covers, a full media swoon, and huge implications drawn by every political pundit from washington to my home state of california. not to mention that the far right tilt of this small state of atypical americans forces candidates to disavow the things that might actually make them sane leaders to the rest of us. need an example? take mitt romney abandoning the sensible romney care from his days as massachusetts governor.

this conservative enacted universal health care. and then there's today's news of newt gingrich's newly discovered fib. "the wall street journal" uncovered a long-lost newt note newsletter from 2006, and in it gingrich hails romney care back when it was passed. gingrich even said the plan would be a model for the country, which it became, for obama. and that was a good thing. but now all republican contenders are aligned against it. in the real world, that original judgment would mark gingrich as a smart, common sense leader. but out in surreal iowa, it means he's unreliable and not conservative enough. this is funhouse mirror stuff, people. for now we're stuck with iowa. but even as we cover the caucuses, we should be asking ourselves if a major party should really be held hostage to a small group of ultra-conservatives who force ambitious politicians to purge themselves of every sane thought. anyway. that's my two cents. while we're waiting for the hate mail from des moines, let's bring in michael hirsch,

"national journal" chief correspondent, and ana palmer. welcome guys. michael, let me start with you. i'm confused about where things stand at this hour in iowa. if you look at the latest poll from iowa state university, it's got ron paul ahead with 28. newt gingrich at 25%. mitt romney at 18, and then on it goes. but the smartest pundits that i talk to, people like john heilemann at "new york" magazine or nate silver at "the new york times" act as if mitt really has it locked up by now. which is it, michael? >> i don't even think, you know, the iowans who are going to be attending the caucuses have any idea who's going to come out ahead. it's really -- could be anyone's vote at this point. and it goes back to your point about what is this state in the rather, you know, unusual caucus rules that determine the vote there, doing at the center of our political spectrum. and i think one of the fears

that you hear, with paul now leading in the polls, is that between paul's lead, a guy who everyone knows who cannot be the nominee or the president, and the new rules for republican voting, which means up until april 1 is proportional rather than winner takes all, iowa could become much less important, particularly if paul wins. >> ana, let me bring you in. i want to talk about this crazy role of money like iowa. i know that's something you, you know, you're deep into. there's a lot of talk about these super pacs, the kind of secret committees that are able to spend unlimited sums. they're spending -- they're raising and ending much more than the actual candidates. is it right that they're not really linked to the candidates? you see something like $8 million or whatever the number is are being run by mitt romney supportive pacs in negative ads against newt gingrich. what should we make of this? >> this is a trend that is not just going to be true to iowa in the hawkeye state, it's going to happen in new hampshire, it's going to happen in south

carolina, and it's going to happen in the general election. this is the s.e.c. rules that we are playing by, or that the candidates are playing by, rather. so you're going to see the super pacs go out in front and they're going to be aggressor, on the offense, doing the nastier ads while the candidating can stockhold that money they're taking in and keep it for later on down the road. >> michael, should we take seriously the idea that there's no official link between these so-called super pacs and the candidates? i mean, it seems like it's a fiction. >> it is a partial fiction. i mean, that was the supreme court ruling. and i think, you know, one of the ultimate ironies here is that the men in the spotlight right now in terms of negative ads is newt gingrich, who was an avid supporter of citizens united, the group that won that supreme court decision, and now he's out there in vain against romney's super pac saying, well, can't romney do anything against these negative ads? this is exactly the system that

gingrich supported and wanted to see in place. and, you know, as your other guests said, i think we're going to see this in the other primary states as well. this will continue to dominate the landscape, the super pac ads. >> i've been hard on our poor friends in iowa, but when you think about the amount of ads that's been inflicted on them, there's some astounding statistic i know we put up. let's put it up again. just the 10,600 negative ads would have been seen by every iowan. if you make a few assumptions, that means everyone in iowa has been subjected to like sitting in a chair and watching 3 1/2 days of nonstop negative ads. first, you've got to just lose all sense that anyone in politics is trustworthy or worthwhile. second, doesn't this violate some sort of torture ban under the geneva convention somehow? >> it certainly is the way that politics are played these day. what you're seeing is that money doesn't necessarily buy support. right now, you have rick perry, for example, spending the most

money in iowa on ads. over $2.8 million, "the des moines register" reported today, yet he's had dismal results. so whether or not -- you feel bad for the iowans that are stuck watching these ads over and over again, they haven't necessarily produced the traction that the candidates would like. >> michael, is it over at this point? is mitt romney kind of -- is it time to just wrap it up and say, he can declare victory? or are we looking at something where ron paul, even despite the racist controversy from some of his supporters that we're going to be covering a little more later in the show, if he wins in iowa, and romney ends up a strong number two, maybe good for mitt, but what a -- what does this mean for the republicans? >> well, i think it's bad news for iowa and the iowa caucuses said earlier, i do think if these new rules stay in place, requiring proportional delegates being named rather than winner

takes all type situation, which is what you had in the 2008 campaign. one of the reasons for these new rules is that a lot of republicans were disturbed by the way john mccain on super tuesday in february of 2008 just sort of came from nowhere and basically seized the nomination. so what you have now is almost by the rules dictated by them a much more drawn-out situation. i think romney is still the likeliest candidate. and i think no matter how well paul does in iowa, he has no chance of getting the nomination. but i do think you're going to see much more of a prolonged debate in the party over who the best not-romney is. who can best counter him, as we see these proportional delegate counts go forward. >> ana, step back for a second as we think about the big picture again. it does seem amazing that in the 21st century, we rely on a hand o ful of voters in handful of arguably unusual states that

politicians have to pander to if they want to get the prize. and this is how we end up shaping what the boundaries of debate are. it's how we end up shaping who ends up getting thrown to the front. isn't this crazy? >> well, it's the way the game is played. you know, for better or for worse. what you are seeing, and i mean, this is typical from the left and from the right. what the republican candidates are trying to do is get the base motivated. it's been romney's biggest problem this entire, you know, fall is getting people excited that he could be the republican nominee. you know, the challenge for ron paul, while there might be people who facebook like him and he's this internet phenom is actually turning out voters in the poll. the real question, i think, that's going to happen is what happens with these second tier candidates and will a michele bachmann, will a rick santorum have a better-than-expected turnout, which could prolong the new hampshire and the south carolina kind of field to make it much bigger than just a couple of candidates? >> so just briefly, michael, i want to give you the last word

on this. what will you be looking for in the next week? help everybody at home know what the professionals are going to be watching as we hone in in these final seven days? >> well, i think, you know, who are going to be the top three candidates in iowa and then a week later, you've got new hampshire, where romney continues to have a dominant lead. i think, you know, if someone like ron paul wins the poll now indicates iowa, and romney beats gingrich for second place, and then romney takes the new hampshire primary as expected, he will be, you know, by any account, the clear front-runner. and it will be very hard to catch up to him. >> all right. michael hirsch, ana palmer, thanks for your insights. up next, mind the gap. the wealth gap, that is. america's net worth plummeting, but not all americans. find out which group doubled there. one hint -- you voted for them. also ahead, trust me. from government to big business, what our specialist says america desperately needs to get back on track. plus, a new moon mission and

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we just spoke about the corrupting influence about money and elections and now new evidence that the wealth gap is spiraling. the average net wealth more than doubled over the past 25 years while your net worth and that of the average u.s. family fell. our usual tuesday mega panel is here. karen, susan, and jimmy. welcome, guys. karen, you're in sin city. let me start with you.

>> hey! >> what is -- is this an old story, because we know the rich are getting richer and the rest of americans aren't -- isn't there something a little insidious when the people who are our elected officials keep growing in wealth while the people who are living under their policies are stagnant? >> well, absolutely. i mean, what's interesting, though, that that trend, what's happening in congress, mirrors the trend we're seeing in the country. that's not necessarily a good thing, because what it doesn't mirror is the reality of our country, meaning that we have, while this wealth gap is increasing, we don't have more people in congress who actually have had to live under that kind of gap and understand the real implications of the policies and the things that they are trying to do. but part of the problem has become running for congress, and running, really, in any election has become so expensive and cost prohibitive, a lot of times there's a real effort to be what we call self-funders. they're looking for people who have the money and resources in order to run a campaign. and i think that's a real problem. and it's one of the things in

terms of how we rethink how we do elections. we've got to start trying to get people to run for office who aren't millionaires. >> now, jimmy, are we doomed them to be a nation of plutoc t plutocrats? are we ever going to get the campaign finance reform that you are beating the drum for? >> this is america and i have great hope for our country. no, look, i don't think this is a new story. it's not like all of a sudden overnight america's members of congress had all this wealth. this has been building and building and building. i think the bigger story here is, why is it that members of congress don't all have to have blind trusts? john kerry had a blind trust, right, or still has a blind trust. he's a millionaire, it's mostly his wife's money -- >> oh, you're going to -- >> mostly his wife's money. but my point is simple. you should not be able to run around and go vote on policy that you can benefit off of financially. if you're going to be a member of congress, you ought to have your money in a blind trust. and then it's out of your hands. >> well, insider trading is not banned in congress. >> that's the point.

that's exactly -- >> let's make it very clear. you are allowed to get information, inside information, and then invest on that. it's not illegal. >> which seems crazy. but the other thing that's always bothered me, let me throw this to you first, you've always had politicians across the years who have came in from humble backgrounds and walked away relatively rich men. lyndon johnson, for whichever accomplishments i applaud he did, came in very humble and walked away with radio stations and real estate and $100 million in wealth. how does that happen? >> you said it to karen herself, it's sin city. that's what's permitted in the house and the senate to go on. and jimmy touched on something. until you can either put people's money in a blind trust or ban them from at least trading on information. >> right, right. >> it's going to continue. >> karen, there's a president we both served, bill clinton, and i think you did also, i always

admired before he got to the white house, i think he never made more than $35,000 a year as governor of arkansas. can you knew, whatever people were trying to fling at him, he wasn't making policy decisions based on money. i think there's a lot of folks who would like that. >> well, that's exactly right. and if you were a member, frankly, a lot of the decisions that bill clinton made, and i didn't agree with what happened under welfare reform, but i remember the great fight he had with newt gingrich about medicare and medicaid and social security, he felt personally about it, because his parents had gone through it. and people from arkansas had gone through it. so point being, he had lived it. so he had a real gut feeling about the importance of these programs and how they impact people. and so to me, i would say it's two parents. i think what susan and jimmy are talking about is really important, because a lot of members do financially benefit from their service, but i also think that we need to have more people in our government who are reflective of our population and the challenges that we're going through. because some of guys are making decisions on things. they've never seen an iphone or

used an iphone. they've never had to go to the library to access the internet. so some of the decisions they're making, they have no connection to what that really means in people's lives. >> but, karen, you know politically, on both sides of the aisle, when you have to find candidates, if you're the democratic party or the republican party of any given state, and you have to go find candidates, you're always going to go to the one who can raise the most money -- >> isn't that exactly the reason -- i want to make sure -- >> -- get the money out. >> unless this becomes a major national issue, so there is a path for public-minded people to get into elected office without having to kowtow to the interests on both sides -- >> but here's the problem. what happens when the public cries out, i want a successful business person. that's been something -- >> that doesn't stop them from running, it just means they can't use their own money if you have publicly financed campaigns. >> it depends how that ends up working out. >> a clean shot for your last shot for finance reform? k >> it's simple.

either you believe the public should fund campaigns or you believe the wealthy should fund campaigns. i don't like the latter win l, the former. it's that simple. >> well said. let's move on to yemen. huge news about whether president saleh will be able to come here for medical treatment after 100,000 people in the street marching miles yesterday because they're frustrated that he's trying to renege on tupprng over power in february. should we be doing -- how many people does an iron man have to kill or injure in his own country before we say, no, you've got to go to paris, got to go to saudi arabia. you can't come to new york to use our hospital. >> at the very least, we should have a definitive answer. and what's kind of happened from this white house, which has done such a good job on staying so timb firm and so tough, he's coming, he's not coming. the u.s. should simply say, he is or he's not. and not allow it up for debate.

it should have been an open and closed issue. this is where he's going, and that really wouldn't have affected many people. >> karen, there's a lot of internal white house dissent on this. some people are saying, look, he's been with us, you know, in the war on terror, and if we make room for him to sort of do these things, it will easy the democratic transition or something like that. but others saying this makes us look like we're on the wrong side of history, helping a thug. where are you on this? >> well, look, it's interesting, because i was reading the back and forth from over the weekend, as a communications person, it felt a little bit to me like there's floating a trial balloon to see what the reaction would be. as susan pointed out, you've got the, he's coming, he's not coming, and he said he would come to the united states because he wanted to be out of the country to calm tens.o comer medical reasons. it felt more to me like there's some testing here to see what the reaction is. but i agree with you, i think

it's -- if i'm hosni mubarak, i'm thinking to myself, well, i want that deal. i'm sick. i'll go to the u.s. for treatment. if that's all it takes. >> what about the hundreds of people who have been injured or killed? are we flying all of them to the united states? let me give dr. jimmy williams a say -- >> you don't want my opinion. i could care less about this issue. this does not lower the price of gas, it does not lower the cost of college tuition in the united states. i don't give a damn. >> well! >> so foreign affairs, off the the table for jimmy williams. don't bring it up. >> i'm sorry! i don't think this makes up -- i don't think anybody in iowa cares. i don't think people in america care. >> we've just been talking about why iowa shouldn't be the be all and end all. sorry, karen, go ahead. >> you know, matt, a lot of people have said that, in terms of not really caring. and to some degree, jimmy's right, on the other hand, foreign policy, a lot of these matters actually do matter. and we should care. because they do impact, sometimes, the cost of gas. they do impact what's happening with our troops. they do impact -- i mean,

foreign policy -- >> but this one doesn't. >> yes, it does, their an ally, jimmy. supposedly an ally until they're not an ally. >> if we allow him to come to this country and it causes an unrest in that country, there may be calls for us to send troops. i'm not saying we would do it, but these things do matter. maybe not as urgently as some of the other issues, but there is a connection. >> the one last thing i want to say before we've got to run, i think this is -- it's moments like this that make -- average americans don't understand, why do so many people around the world hate america at different times? because we think of ourselves, our self-image is we're the good guys. and yet at moments like this, if you're an average yemeni, seeing that your brutal dictator is going to be allowed to kind of come scot-free to great u.s. medical treatment, people say, wait a minute, which side is the u.s. on. you look like you have to have a last word? >> to what karen was just saying, you have to be decisive, though. this should simply be a case of,

this is what's happened. they should be saying he's coming, or he went somewhere else. and it doesn't have to be a subject of debate in the press or around, you know, jimmy's kitchen table. >> most americans don't even know where yemen is. >> sound advice from the panel. the panel stays. up next, our specialist is joining with some fresh ideas for how washington with win back our trust. a tall order, but we'll hear the man out. that's next. what is it about taking a first step that we find so compelling? is it because taking a step represents hope? or triumph? at genworth, we believe in taking small steps every day to keep your promises, protect what matters, and prepare for a secure financial future. no matter where you want to go, one step at a time is the only way to get there. go to genworth.com/promises.

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trust is earned. and as far as americans are concerned, washington in particular hasn't earned theirs. less than a fifth of those surveyed in the latest gallup poll say they trust government even most of the time. that's among the lowest since pollsters started asking that question. but it's not just d.c. from big business to the banksters, the 99% feel let down by the 1%. and who can blame them?

yet today's specialist claims all hope is not lost. robert hurley is a business professor at fordham university. he's also the author of "the decision to trust: how leaders create high-trust organizations." welcome, robert. congratulations. i know your book was just named one of the best leadership books of 2011 by "the washington po " post." so that's a great honor. i hope you can answer all our questions today. >> i'll try. >> why is -- it's so clear that we've lost faith. the average americans have lost faith in basically elites in every sector, leaders in every sector. business, governments, nonprofit, the church, you name it. why is it so eubiquitous and wht do we need to do to fix it? >> well, it's actually good judgment. because there's been a decline in trustworthiness. all right, so i actually suggest we don't have a trust problem, we have a trustworthiness problem. finally, people are starting to say, some of these institutions are not trustworthy. therefore, i'm going to withhold trust. >> susan? >> well, how important is transparency when it comes to

this? it seems now one of the reasons why 99% of the people don't trust anyone in the elites is they're working for somebody, and they say, don't worry, your job is secure at bear stearns and the next day day go down. or they hear their elected official saying, oh, don't worry, we're going to vote this way and then they change the vote. how important is transparency to really show people that you're sincere and build that trust? >> one of the things that is critical to trust is communication. trust is about a relationship. cuff a good relationship without communication, right? and you talk transparency. i trust someone. i offer my trust to someone who's going to tell me the bad news that i'm going to hear, right? which is transparency. is going to tell me the full story. you talked about the finance crisis. many of these firms, as they were declining, their ceos and cfos were looking at how wonderful the balance sheet looked, not transparent. that's what we call deception. >> but it's the same with politics. you've got politician who is say, you know what, as the baby

boomers age, taxes will have to go up. because they feel almost professionally obliged to lie, because they think they're not going to get elected if they tell the truth. is that the kind of -- >> yes. >> brutal obstacle to ever reestablish -- >> yes. and we actually should blame the politicians, but we also have to take responsibility. at some level, we want to be lied to. we're bad trusters. we don't discern trust in a sophisticated, intelligent way, so we offer trust to those people who are untrustworthy. >> jimmy, he's talking about you. >> actually, i care about this. so i'll comment on it. i went to the citadel for undergrad, and we have a motto there. you don't lie, cheat, or steal, and you don't tolerate those who do. is it time for america's businessmen and women and america's government to have a code of ethics? >> no question about it. well, every company has a code of ethics. >> really? >> yeah. >> ask america, because i don't think they do. >> it's not if they have a code, but do they live the code?

the military lives the code, right? >> yes. >> by the way, you know who's doing a lot of leadership training up at ge now? west point folks. there are some companies who are saying, we have an honor problem, we have an integrity problem. we need to fix this. by the way, here's the thing. we can fix this problem because we know what trustworthiness is. we have 50 years of research in social psychology that tells us, definitively, that there are some properties around trustworthiness. we can embed those in leadership, we can even embed those in institutions and companies. we can even embed that in government. now, that's going to require systemic change. huge, systemic change. >> we're up for that on "the d.r. show." >> right. systemic change is our business. karen, systemically change this. >> all right. well, it's interesting, because one of the ways, actually, in politics we've systemically changed it, we've found similarly in this trust deficit, people trust information they get from other people more than a television ad or a mailer or even a candidate. so a lot of campaign tactics have focused on that individual person-to-person communication and that sort of grassroots organizing.

but i'm wondering if within that, i mean, you're talking about institutions, but are there any implications in terms of interpersonal communications or institutions with regard to race or gender? do we trust certain races of people more than others? do we trust women more than men or men more than women? there's been some research done on that as well, and i'm wondering if that came through in the work that you did? >> absolutely. it's called socialite theory. we tend to trust people who we think believe the way we believe and are members of our tribe. by the way, bernie madoff used this wonderfully to dupe the jewish community and members of his golf club to trust him. >> they trusted him. right. and people always say that's why the u.s. is harder to governor as a nation than sweden or norway, which is less ethnically, you know, diverse. true? is that -- >> yes. and norway has incredibly high trust scores. about 75% of people in norway say we trust, in the united states, it's about 40 to 50%. >> i think you've got an acronym that sums up some of your

framework called basics. is that right? >> we need to go back to basics. what do you look for in trustworthiness, benevolent concern. >> that's the "b." >> "b." ability to perform, can they get the job done. "s," similarity in values. "is, integrity. "c," communication. "a and "s," shared interest. are our interests aligned or are they conflicting. if you can discern these things, we should be able to choose more trustworthy leaders and embed those properties in institutions. >> yet it's interesting to me, being a little empathetic to politicians for a second, i can imagine these principles are easier to apply in business leadership than in political leadership, because you've got a common mission, you're trying to, you know, earn a return and build a business. so it's easier to sort of get folks aligned. the political arts are harder, right? you've got this incredibly diverse nation with incredibly

diverse interests. talk about the differences and what that implies? >> exactly right. zapp zappos, high trust company. they pay people to leave if they don't share the values. you can't do that in our government. so what has to happen in our government, we have to come together in a philosophy around what government is. that's the big problem in congress. the democrats and republicans don't agree on a philosophy of governance. how can have trust? >> isn't that why politicians have focus groups and they worry about this and they sell a bill of goods to get elected, and they say, what makes me look like i share peems values? what makes me look like a good leader? what are my buzz words? and doesn't that kind of -- you don't do that necessarily in a corporation, but do it in a political campaign. >> because if you can fake trust, if you can fake sincerity. >> and if you can fake it with a bunch of ads. >> by the way, i would argue, a lot of political marketing is convincing people the other candidate is not to be trusted.

to create doubt in the other candidate. but that's disingenuous. >> karen, a nanosecond from sin city. >> hey! >> isn't that part -- i mean, i can say from a political context, that's why part of honest and trustworthiness on a poll is one of the things that we look at the most carefully, because it is one of the things, even if somebody disagrees with you, if they believe that you share their values, they would actually still vote for you, potentially. >> brief last word? >> i think we have to start to discern trust much for carefully in these elections and start to build trustworthiness into these organizations. transparency, openness, and it's up to u.s., the trustors. we've got to make better trust decisions. >> i trust you, implicitly, that this is the direction we could go. bob hurley, very provocative stuff. thanks very much for coming by. thanks as always to the mega panel. karen, jimmy, and susan, and

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if you got a telescope for christmas, nasa needs your help. scientists from arizona state university are asking people to go online and pore through images of the moon and to break out their own telescopes to help find signs of alien life there. the researchers say there could be evidence of aliens in the forms of messages, waste, or mining operations. they say the moon is the perfect place to search for past alien visits, because the lunar landscape can preserve artifacts for millions of years. there's just one problem. the every-expanding amount of data makes it impossible for one team to review it, which is why

they're asking for amateur enthusiasts' help. to put it in perspective, nasa's lunar reconnaissance orbiter has been taking pictures of the moon since 2009 and collected more than 340,000 imagines. that's almost as many pictures as my daughters' friends have up on facebook. there's no way a small team can look at them. so even if there's little chance they'll actually find aliens, with volunteers helping, it won't cost much to look. and if this works, who knows what science will crowd source next. maybe the search for intelligence life in the republican field. still ahead, the state of the american workforce, what to expect in 2012 if you have a job and if you don't. oh it's clearance time! yeah, our low prices are even lower. we need to teach her how to walk. she is taking up valuable cart space. aren't you, honey? [ male announcer ] it's our biggest clearance event of the year where our prices are even lower. save money. live better. walmart.

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yeah, i toog nyguil bud i'm stild stubbed up. [ male announcer ] truth is, nyquil doesn't un-stuff your nose. really? [ male announcer ] alka-seltzer plus liquid gels fights your worst cold symptoms, plus it relieves your stuffy nose. [ deep breath ] thank you! that's the cold truth! we're back. breaking down the state of the american workforce. right now, our unemployment rate stands at 8.6%, the lowest we've seen in 3 1/2 years. although when you take into account part-time workers and those who have left the workforce altogether, we're really at 18% real unemployment. in fact, our next guest calls it a tortoise recovery. remember, we need 30 million jobs to fill the jobs gap. with us is daniel pink, workplace guru and author of the

workplace drive. i want you to give us the good, the bad, and the ugly on the kind of workforce roundup at the end of the year. start with the good. what's the good news in terms of the workforce right now? >> the good news you just mentioned matt is that the unemployment rate is down to 8.6%. and we forget that for 29 months, that rate had been above 9%. so that's not bad. over the last more than a year, every month for the last 13 months, monthly job growth had been positive. that is, we've been creating more jobs than we've been losing. that's a good thing. and the other thing that is a little bit of a secret in the data, if you look at some of the bls figures, is that now -- for a long time in this recession, you had more people who were leaving jobs involuntarily than voluntarily, all right? the involuntarily is called a layoff, the voluntary is called a quit. now for the last several months, the quit rate has been higher than the layoff rate. which suggests that people are feeling a little bit more confident, that conditions are

improving just a little bit. so there is, i mean, it sounds -- we tend to have really focus on the gloom and doom, but there are some glimmers of hope and positive news in the labor force today. >> you know, that's interesting, because i haven't seen that quit rate versus layoff rate get any attention, so i'm glad you brought it up here. give us the bad news now. obviously, there are still tough times for a lot. >> yeah, well the bad news is that the 8.6% unemployment rate. that is just historically, extraordinarily high. i think one of the things we've missed is just how bad this set of circumstances is right now. that is, we -- this is not like an ordinary recession. this is not like an ordinary job market calamity. we forget that in the 15 years leading up to december of 2008, the unemployment rate never rose above 7%. and now we're at 8.6% and giving each other very soft and gentle

high fives about how good things are. so we've got still got a long, long, long way to go. the other thing is that the pace of job recovery, which is now at about 110, 120,000 a month, it's going to take a long time to get those 30 million jobs that you just mentioned. so what we have in the 1980s, we had essentially a u-shaped or a v-shaped recovery where we sunk very quickly, rebounded very quickly. in the 1990s, we had something that might be a historical anomaly. we had very much what some called a goldilocks recovery. not too hot, not too cold. really great growth with low unemployment and low inflation. now what i think we've got is, as you mentioned, matt, really a tortoise recovery, where we're pointing in the right direction, which is a good thing, but we're moving very, very, very slowly. and we haven't seen anything like this in labor markets ever, and the consequences for politics and for our workplace

policies are dramatic. >> now, one thing you didn't mention in your bad news trends, which strikes me also, i just want to ask you about is young people entering the labor force. lots of talk about the fact that with this job market, if they fall behind in these early years because they can't get traction in a career, the impact on their earnings over their lifetime amounts to a real disaster, some are saying. >> there is some evidence of that, that the moment at which you enter the job market, if it's a down market, that you're going to actually suffer from that legacy over several decades, which is alarming to anybody who's graduating from college and going out into the job market right now. the good news in that is that anyone who's graduated from college has graduated from college. and if you look at the unemployment rates based on education, they're -- it's dramatically different. someone with a professional degree has half the unemployment rate of someone with a bachelor's degree, and someone with a bachelor's degree has half the unemployment rate of someone with only a high school diploma.

what we're seeing now are massive returns to education, in part because of a new set of skills that are in demand. >> now, i know you've also been tracking three trends that are going to shape all of this, not just in 2012, but beyond. take us through those. there's long-term unemployment, is the first one. >> wow, matt. i mean, this is a big issue. and we're not talking about it. you have -- among the unemployme unemployed, 13, 14% unemployed, almost half are long-term unemployed. meaning they've been unemployed for almost a year or more. this is a big, big issue. because once someone is unemployed for a long amount of time, their skills start to erode, their connections start to fray, and it's very difficult to get them back into the labor force so they are productive. and we have the largest number of long-term unemployed that essentially this country has ever seen. and we're doing nothing about it on a policy level. so we're marooning several million people outside of the

traditional job market, and the consequences of that at a human level, at an economic level, are severe. and we don't hear anything talk of that. >> now, you're also the -- called "free e god father oftr. agent nation" about ten years ago. it seems prophetic. tell folks what they should understand about the free agency phenomenon. >> well, what that means is it's a move away from traditional employment to people working for themselves, as freelancers, as elancers, as proprietors of very small businesses, from consultants going from project to project. and the big thing there, matt, is how much of the risk has shifted from the organization to the individual. that individuals have now much greater responsibility for a whole host of things that they used to rely on the benevolent corporation for. we see it in pensions. a move from defined benefit pensions, where you got a check every month to 401(k)s, which are now the dedominant form of

pension. we see it in health care, where people are more -- are being required to contribute more and more to their health care. we see it in education, where education and training budgets have been reduced and people are force d to do it on their own. so this shift of risk from the organization to the individual is profound. and once again, our policy mechanisms haven't caught up to that. >> now, you -- the last trend that i know you have talked about is the idea of skills that can't be outsourced. what's the significance of that? >> well, it's huge. today, and i think this is one reason why we have the sluggish recovery. what you have now going on is a shift in the abilities that are most necessary for work. it used to be, in what we thought as the information age, the most important abilities were the logical, linear, s.a.t. spreadsheet abilities. and those abilities still matter, but they matter relatively less. because those kinds of abilities can be outsourced or automated. if you're an accountant doing relatively routine tax preparation, an accountant in

manila can go it for $450 a month, or your client, instead of paying you $800, can get a software preparation program, turbo tax, for 30 bucks. and so today, what you have to be able to do is work that is difficult to reduce to lines of code, and become a piece of software, and difficult to send to low-cost providers overseas. and what that means is that these kind of schoolbook s.a.t. spreadsheet abilities, which used to be the pathway to the middle class, are necessary, but not sufficient, and it's really the harder to outsource, harder to automatic big picture artistic elmpathic abilities that now matter most. again, i hate to sound like a broken record, but once again, our policy mechanisms have not anywhere close to caught up to this. >> and on that megaquestion, it seems like we're entering the campaign year. both parties, you know, the tectonic plates are shifting, economically, and with the job market, and both parties seem to keep kind of offering the same

b bromides on each side that aren't equal to these huge shifts that are going on. in five seconds, dan, solve it all for us. >> it's kind of an irrelevant conversation that's going on right now. the best way to put this, matt, is that republicans -- democrats blame big business and republicans blame big labor. but less than one out of ten americans works for a fortune 500 company, and less than one out of ten americans in the private sector belongs to a labor union. so it's a conversation of ir irrelevance. and this goes to the issues of trust you were talking about earlier on the program. here's hoping, though, that eventually we'll have a real conversation about the real issues. >> all right. dan pink, thanks for those insights on the job market and being ruthless on the inadequacy of our political debate. i also love your phrase, tortoise recovery. i might have to steal that. that's great. >> it's yours. >> happy holidays to you. >> happy holidays, matt. still to come, it's jonathan capehart versus ron paul in today's daily rant. step that we find so compelling?

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time now for our daily rant with the ever-insightful jonathan capehart on race and the republicans. jonathan, the floor is yours. >> thanks a lot, matt. the republican party has a race problem. i mean, it always has, ever since southern democrats did what president johnson said they would do when he signed the civil rights act of 1964. quote, we just delivered the south to the republican party for a long time to come," he famously remarked. and the gop would ride racial resentment and fear to greater political power up and down the ballot across the country.

but as we're seeing in the contest for the nomination, race is boomeranging on the republican party. ron paul, one of the top-tier candidates in the impending iowa caucuses, has been tripped up by those racist newsletters that bear his name, but that he claims to have never have written or read. other than dismissively saying he disavows the comments, the texas congressman has been relatively silent on the issue of race. and this follows a pattern we've seen all year. whenever racial controversies flare up, deny, disavow, or dispute as quickly as possible and then pretend the matter is behind you. governor rick perry employed this tactic when he tripped over that hunting ranch with the racist name that his family leeds in the 1980s. governor haley barbour of mississippi tlooeds recognized he had a race problem during his exploratory phase earlier this year. he floated the idea of giving a speech on race after revealing a blind spot as big as the confederate flag. but it is believed that barbour

pulled the plug on a possible campaign because he couldn't figure out how to deliver such an address without hurting himself politically. and then there's herman cain, who used race as a hammer against his critics. those who dared criticize him for anything were stuck on the, quote, democrat plantation, or fearful of, quote, an accomplished, articulate, optimistic black man, or any of the other race-based excuses he used to get away from explaining his glaring deficiencies or his alleged moral lapses. here's what i predict. sooner or later, a major candidate for the republican nomination for president will have to give that party's equivalent of president obama's speech on race during the 2008 campaign. a frank assessment of the issue that discusses the party's role in exacerbating tensions and sewing division, the state of race relations from his or her perspective and how they see their role in making this a more perfect union. that ron paul might win in iowa demonstrates how far off that day is.

and until that day comes, the republican party will deserve to lose the political and electoral advantage creeded to them by lb 47 years ago. >> that's a great set of points, jonathan. are we doomed to this as being the kind of dark underbelly of republican politics? i mean, it's hard to believe in the 21st century, this is where we are. >> reporter: yeah, it really is hard to believe. and it's hard to believe that so many of the candidates in this crop -- they've had sort of their racial issues or their racial problems, but i do think, again, if the republican party wants to maintain whatever edge they have in the south, but also to be taken seriously as a major party with serious candidates, someone, sooner or later, is just going to have to step forward and say, okay, look, we've got this terrible history. we own it, now we're going to move forward together to try to heal these problems. heal the the wounds. >> well, jonathan, here's hoping that we're going to see that