growth is three point six percent they spend just one point five percent of their g.d.p.on defense that spending is forty two billion dollars now meanwhile germany is a country that has fared the financial crisis very well and it also has cut its unemployment down to six percent it's one of the largest exporter so that's kind of looking at the strengths now let's look at denmark this is of course where the nato secretary general is from he's a danish politician they spend again just one point three percent of g.d.p. on defense just two billion dollars two point five billion well denmark is known to have a very very high quality of life for its citizens they live very well it's known to be a wealthy country moving on to luxembourg very small country but also known for its high per capita g.d.p. income it spends just point nine percent again on defense three hundred fifty one million dollars big group three point two percent as an economy in two thousand and ten as i said pretty high quality of life there now if you compare those countries to the united states which spends

course oil plays a very important role however oil and gas only make up about fourteen percent of g.d.p. where is services retail make up fifty two percent so from that perspective russia is a pretty normal country where what is important is it will make something of a sixty percent of both export revenues and the government. tax revenue base so what's going on here is is this providing the cash for the government to do its investments and it's providing liquidity for the market the actual economies being driven by spending by small mini size and surprises retail the normal economy. but some of this is from the outside world is seen to be absolutely important and if the oil prices tanked and the equity market tanks government revenues tank because they use an old ok to such you know they have access on every negative lattimer also. also cost you then really in a way just given what benj is that it really still is an oil story because the oil prices go down so low in russia is in a very difficult situation isn't it respective i mean all of the other elements of how you break down the eco

at the structure of russia's g.d.p. and say hey russia receives more than fifty percent from from services so it's not come out of the driven economy however if you dig a bit deeper and look at how much of consumer demand. and the demand for local services and financial services for that matter is driven by all the money which is reduced to a butyl through bite it through the garments then you would realize how strongly the car country country's economy is still reliant on. revenues raised from oil i say that yes russia is perhaps less dependent on oil than it was ten years ago but it is certainly still very much duchesses case. much of industries outside of the commodity sector as my colleague another londoner just said are not that competitive both on a global markets and domestic market so that means that there is a huge need for investment in order to modernize this industries in order to make them competitive however when you look at the sources of this investment you end up with it will become oddity revenues in t

24.3% of our g.d.p. an astonishing 30% more than we have spent historically when our budget was balanced. and our debt held by the public at the end of this year will be nearly double what it was when this president took office. so how do we get to such a high level of spending? well, to be fair, madam president, i think you would have to say that some of this is attributable to the economic downturn, obviously tax receipts, revenues are down as a consequence of the economy being in a recession. we also have the ongoing conflicts in iraq and afghanistan which have been expensive and obviously have required a large commitment of resources in order to conduct the operations that are necessary for success there, but i would argue also, madam president, that a substantial, a substantial chunk is due to the spending spree that congress has been on since 2008. between 2008-2010, spending on nondefense discretionary programs went up more than 20%, even though inflation over that same time period was around 2%.

in the same year deficits would be about 16% of g.d.p., and debt to g.d.p. would be 185%. so we would actually vacuum la alternative debt -- have a cumulative debt almost twice the size of our economic output, entire g.d.p. for that year. these are more than just numbers for economists to look at. these have real impacts in real time. they affect people across the country today. and i wanted to point out again, as i have mentioned in the past, the study done by economist reinhart and rogoff which took a good look at countries, and particularly developed countries that have acquired or accumulated the sort of debt level that we're looking at in this country and what that, impact that has had on their economies. in their analysis and their study, they came to the conclusion that when you reach a certain level of debt to g.d.p. -- in this case 90% debt to g.d.p. -- that you lose one percentage point of economic growth. in other words, economic growth would be one percentage point less than it otherwise would be simply because of that high debt to g.d.p. level that the country

the commerce department says first-quarter g.d.p. came in at 1.8%, that's down from 3.1% at the end of last year. new claims for jobless benefits reversed course this week, rising when a drop was expected. the labor department says new claims rose by 10,000 to a seasonally adjusted 424,000. a federal judge in wisconsin today struck down a controversial state law that stripped most collective bargaining rights from public workers, but that may not be the final decision as wisconsin's supreme court takes up the issue next month. still ahead, friending your utility company, or how the concept of social networking can help businesses save big money on energy. it's tonight's "planet forward." >> tom: the vice president and a bipartisan group of congressional negotiators met for a little over an hour today. they're working to hammer out an agreement to cut federal spending and raise the nation's debt ceiling. time runs out in early august. lawmakers in the talks say they

in one thousand nine hundred five after world war two we're one hundred twenty nine percent of g.d.p. over the next four years we work that down to we're pretty much was a normal until reagan became president and we did it without cutting any spending in fact it was spending like crazy we did it by growing our economy what's wrong with doing the time to switch if you got yeah you got it right now we have to cut spending medicare is i think it's because medicare is the biggest driver of the national let's just look at government leaders go share drugs just like the issue that you have to put in solution that cuts spending but is so wrong that we do it i think that we do i mean you want to say medically are you really your god you know you are your own expenses time if you find out that you know you're spending more than you're going in do you just keep on borrowing of course not you get yourself into a big hole and pretty soon you can be on the show anymore but you know you have your experience is that america does but my point about medicare is that the republicans set up this bomb in

our g.d.p. is now the world's second largest. but in terms of those hard power and soft power there is still a big gap between china and the united states. what is even more important is that when we looked at the per capita numbers, china's per capita g.d.p. is ranking around the 100th in the world. this is something that has never happened to the world before. this is a very unique circumstance. there has never been one single country in the world with a second-largest g.d.p. but with a per capita g.d.p. that is ranking around the 100. you mentioned the issue of the exchange rate. talking about the exchange rate, there is one thing i'd like that mention to your viewers now. in china other people have made a comparison between our economic relations with the united states and japan's economic relations with the united states. a lot of people in the united states actually made such comparisons. the five differences... among the five differences too two of them were raised by larry summers. when i came to the united states he told

., 24% of g.d.p., down, glide path down to 20%.that buys in to is the idea that the problem is a spending problem. it's not a revenue problem. and there are democrats witness that, claire mccaskill, who agree with that. she is under attack now by moveon.org, by the left. it will be a tough road for those kind of democrats to make that case. i have don't think they are going to have the backing of the administration on that one. >> i have to argue we got great clarity this week. john boehner came out and gave a speech where we referred to this and he said we'll go dollar for dollar with you guys. you know, you want a $300 billion increase in the debt limit? we want $300 billion in spending cuts somewhere. so the ball is in your court. that actually frames this issue. the other thing he did is talk about the mechanism of this. which is important. what the white house has been saying is we want a debt cap. if you go above the debt, a certain level, automatic new tax increases come in. that is like saying we can't help ourselves, we sp

period between our victory in world war ii and 1960 saw our national debt fall in half relative to g.d.p. we accomplished this reduction through economic growth and by limiting new government debt, and we can again. we must emphasize pro-growth tax policy, lower discretionary spending, and reduced future growth in social security and medicare spending for more affluent americans. we need to be sealing the debt burden, not arguing about the debt ceiling. i'm glenn hubbard. >> tom: just a reminder, you find us online at n.b.r. on pbs.org. there you can comment on our blog or watch any programs that you may have missed. or you can follow us on twitter, @bizrpt, or my personal feed, @hudsonnbr. if tweeting isn't your thing, friend us on facebook at bizrpt. >> susie: and finally, last month's royal wedding led to a within with the tsunami left nearly 30,000 people dead or missing. the casualties were overwhelmingly among the elderly, not just because they were more physically vulnerable. the crisis highlights the hazards of an aging population. and as japan grapples with the enormous cost of

25.9% of g.d.p., more than 25% above the historical average. it would continue to grow into 2035 spending would comprise 35.2% of g.d.p. or nearly 60% more than the historical average. in that same year deficits would comprise nearly 16% of g.d.p. of our entire economy and debt would be 185% of g.d.p. i want to illustrate that in the form of a chart here, madam president, and just show you what this would look like. historical average for deficits, 3%, as i said, if you look at the, what we faced in the last 40 to 50 years roughly, and where that is headed in these out years. if you look at 2010, how this thing has spiked up just in the last couple of years here, we've added massively to the debt, and the stimulus spending, the massive health care entitlement program, all of which are going to make this even worse. but we're on a trend right now, if you draw this out and follow this trajectory, where we will get to where literally the deficit is going to represent 61% of our entire economy. that is a

indeed, when we passed the 90% of debt to g.d.p. ratio, the economist rogoff and rinehart, who committed a national study of economies around the world by sovereign states, have warned that at that level, you reduce the growth of the economy by at least 1% of g.d.p. the average was higher than that. they said on a median level, it's 1% of g.d.p., and they've used that number. 1% growth that we don't get. well, some think we may not get 2% growth this year. would we have gotten 3%? if we had 2%, would we have gotten -- if we get 1%, would we have gotten 2%? 1% growth in d in g.d.p. is a le thing in an economy the size of ours. it increases tax revenue, significantly increases jobs, according to experts, 1% of g.d.p. growth means a million more jobs. a decline of 1% in growth in our economy represents a loss of a million jobs. this is not a little bitty matter. so on monday, i objected. i realize what's going on in the senate, that near there's no plo deal with this, that there's a gimmicked-up scheme to bring up a series of budget vo

of china's provinces have already published their own five-year plans, and most have double-digit g.d.p. growth targets, driven by increasing levels of investment in fixed assets. so, from restructuring the economy to tightening money supply, the central government could soon face resistance. >> chinese policy-making is more like trying to herd cats. whether it's trying to get the state-owned enterprises to obey the dictates from beijing or trying to get the provinces or municipalities to go along with the game plan that beijing is trying to set, it's actually hard to get them in line. >> reporter: china's leadership is serious about cooling key sectors and rebalancing the world's second largest economy. but while the political system here is certainly authoritarian, it's not entirely top down-- so beijing's will doesn't always prevail. nick mackie, "nightly business report," chongqing. >> susie: in other overseas news, cuba is studying plans to let its citizens travel abroad as tourists for the first time in more than 50 years. that's one of more than 300 reforms published today by tha

course of the next four years some experts predict the economy will contribute almost four percent of g.d.p. well for more on this let's cross to our business desk and hobbs is there it's got latest katrina so what are the prospects there for a major well you're absolutely right maria that russia could potentially double its online economy in the next four years but right now it's basically an issue of distrust which obviously many internet companies have faced and continue to be challenged by but if they can overcome this and develop a strong infrastructure for growth the prospects for the six are advised and of course in around six hours time all eyes will be on the russian internet company yandex to see how it performs and what's tipped to be the world's largest take knology i.p.o. of the year so in all of their interesting moments in business the heads. excellent thanks very much indeed for this and looking forward to seeing in the studio meantime russian authorities are stepping up the war on drugs in the country but for some the speed of progress just isn't fast enough now activists a

g.d.p. in nominal terms talk about corporate earnings in nominal terms talk about the rebound since the financial crisis lows of two thousand and eight in nominal terms but to avoid talking about these figures in real terms what does the s. and p. five hundred buy you know what does u.s. g.d.p. by you know when to those corporate earnings par you know they buy you a lot less of just about everything you need to run a business or to live in retirement so you know this is a a reality that sort of you know behind the front page and of course we're starting to see of profession professional money management we're certain if you the first few professional money managers like university of texas feingold we've got journey grantham and g.m.o. in boston talking about the problem of scarce resources we're starting to see the first few escapees from the world of nominal and they're starting to face up to the world of real. oh well another factor in this of is the percentage of income that people spend

ago that that one bank that had more money as i recall is claudia than a quarter of the country's g.d.p. i didn't see that but it would be surprising if it was some just incredible number . if i did go to a bank and used to be ten thousand dollars and five thousand dollars if i go to a bank and i've got more than five grand in my account and i just say i'd like cash please. or if i take five thousand dollars cash and say please deposit this right my account my bank by law has to notify the part of homeland security and the internal revenue service and if you've got fifteen hundred dollars in the bank and they pay you interest on that during the year they have to send it. to the i.r.s. at the end of the year so right if i'm a narco traffickers from colombia or if i'm a weapons dealer from mexico or pretty much anywhere else i mean you know and so this is not limited to south america if you know if i'm some rich you know buddy of silvio berlusconi's in italy and i want to stash my money in the united states and bring it in the suitcases whatever it's there's no problem. well they're suppo

of the next four years some experts predict that the economy will contribute almost four percent to g.d.p. let's get some more details on this now and of course a lot of business and up to katrina so we're talking about a major the boom here on where well that's the hope you're right in that the potential is there for russia's online economy to grow more than double over the next four years but right now it's facing the issue of distrust which a lot of internet companies have faced in the past and are still continuing to face if they can overcome that issue and develop a very strong infrastructure then the will is there also they can really go a long way and also in about four hours time all eyes of course will be our new york to see how russian search engine yandex will perform and what's to be the world's largest technology i.p.o. for this year so an interesting business news next certainly is going to and will be seeing you in about twelve or thirteen minutes. but russian authorities are stepping up the war on drugs in the country but for some at the speed of progress just isn't fast e

because there are seven hundred trillion in paper around the world on a fifty trillion dollar global g.d.p. and when you drill down to markets like gas you've got oil collapsing in price while gas prices at the pump are increasing because that's the actual physical market is actually going up but the paper market is being manipulated in all manner of violent manipulates of psych path ology being practiced by these psycho pathologically insane or partridge yours quantz places like wall street and goldman and j.p. morgan were you by the way during the period you know you just kind of disappear there for a few days you send in their own party and the owners are in every other end you wish you had gone yes you got a gun to look like a banker in one of those fish that kind of come out of touch and talk like a fish fish fish i mean where were you exactly i mean you kind of went off the grid actually somebody in the comments section said i've never seen such a redneck room. but we're talking about all the margin. rate hikes that we see well shanghai also joined in member you seem to differentiate

g.d.p. you can organize a quarter the size of the u.s. economy these are vast financial institutions absolutely i mean not got good news sounds like it's coming our way with the russian economy seeming to be improving but what could change that situation i think the main vulnerability in russia is obviously inflation and with inflation running let's say nine percent and close to double that and your lies over the last six months. it is a policy tightening. to depress activity just at the time when the global economy is experiencing a slowdown in monetary policy time in china the us economy showing signs of a slowdown in the crisis in europe and we talked about an impact there on activity the risk is that monetary policy in japan russia trains probably more at this point in the cycle than would be necessary given what's happening its origin sleep well there's a lot to think about there not all good news over it thank you very much for your time although it's a myth that was for myself chief economist long but only a bank now let's have a l

in interest costs alone and it started staring at a likely straight year of g.d.p. contraction can athens avoid a default without more bailout funds probably not this is a serious concern for the greeks. the bigger concern for europe is that should we allow greece to depart from the euro that would destabilize the euro so therefore greece has to commit to very serious reform there is some political move towards a purpose and a bit better if you think about it even of greece were to restructure their debt by fifty percent or to compete with quite a long time to recover natural growth rates it's got an economy that's the eat out that's nasty you're a big bob dylan fan i hear and read here so what do you think bob dylan would say about this financial crisis i think you're probably going to version of his seventieth birthday and stay forever young and look into the future in the future when we look like this is only a blip this one little crisis as i said earlier to you it is not afraid of the foreign exchange markets but it's a serious crisis for us in europe because w

of the next four years some experts predict the economy will contribute almost four percent to the g.d.p. well let's cross now to our business desk work a train of following the latest developments so katrina we were talking about a major evil here aren't we or we're hoping so obviously the word the key word here is potential and as you say russia could potentially grow its online economy by more than double over the next four years right now it's facing an issue of distrust which many internet companies have faced and continuing to be challenged by but if they can overcome this and put in place a really good strong infrastructure for growth prospects for the sake of last of course later today we'll also see how yandex performs in new york and this is tipped to be the world's largest technology i.p.o. of the year so it could be an exciting day here oh we're certainly keeping our fingers crossed there for the economy and looking forward to seeing here in the studio with more business news thanks very much. now russian authorities are stepping out of the war on drugs in the country but for

a it's it's the opposite of how we have to incur more and more debt in order to have one dollar of g.d.p. growth the same for the way down for these guys to take profit from destroying the economy they need to make the collapse bigger and bigger and bigger no question that created a financial cuisinarts they take fifteen trillion dollars economy and they dump it in the quezon are and then they chop right. in the left. there they sell for you know what the christmas scavenger you know the country thanks eric thanks so much for being on the kaiser report and thank you that's going to do it but as much my coming away stay right there. they are killing innocents here oh i think they face a crisis and that's never and said. mom a song from the skull spoke with me i think you are but every day. the fly is fired from the memories. i know so much so long time the series. i was ashamed. i was ashamed that i didn't. i was ashamed that i had been a hero why. go i go away. but i want the vietnam war to the. head i'll believe what i was going on once or i think. that i was a good soldier. but not mos

you size of bank as has to g.d.p. normally your conclusion will be that in russia we may be five hundred through five hundred banks so definitely. the last thing with all thousand banks. to be excess i would just quickly if we compare russian and european banks how do they differ but the key problem loans it's russian banks cept they sort rates on the russian counter standards with a different capital i think those who climbed off the sun well we know that the global banking in the developed countries operating on the national. and they're the capital i think with some different promise on not much the ok after all thanks very much that's all we have time for us this. that's the latest we have for you i'll be back with more in fifteen minutes. wealthy british sign the sun. is going to. go.

it's it's the opposite of how we have to encourage more and more debt in order to have one dollar of g.d.p. growth the same for the way down for these guys to take profit from destroying the economy they need to make the collapse bigger and bigger and bigger mostly they've created a financial cuisinarts they take fifteen trillion dollars economy and they dump it in the quezon are and then they chop right. and then what's left. there they sell for you know what their christmas bonus scavengers in other countries say sarah thanks so much for being on the kaiser report thank you max that's going to do it but don't go away because it's much more coming your way so stay right there. sure is that so much. i mean i think the real. issues of relevance and even legitimacy as the jostling continues as to succeed the stories so many chances. for the food we've got the. biggest issues get a human voice ceased to face with the news makers. i welcome back to the kaiser report time now to turn to economist john maternity the former c.e.o. hushmail he's a former chief for extra visa he's also a blogger an

a it's it's the opposite of how we have to incur more and more debt in order to have one dollar of g.d.p. growth the same for the way down for these guys to take profit from destroying the economy they need to make the collapse bigger and bigger and bigger mostly they're creating a financial cuisinarts they take fifteen trillion dollars economy and they dump it in the quasar and then they chop. it up in the most left. and they sell far you know what the rest of the scavengers in other countries face never thanks so much thing on the kaiser park thank you that's going to do it but don't go away because much more coming in life they are right there. they're actually in a sense here oh i see a place of course and that's never answered. on the song in the skull spoke to me i think of it every day. the flashlight from the memory. i. must say a long time. i was ashamed. i was ashamed that i didn't. i was ashamed that i had been a hero why. i go away. in the mine. where i wanted to be out of knowledge of fortune. then i'll believe what i was going on once or i think. that i was a good soldier.

it's it's the opposite of how we have to encourage more and more debt in order to have one dollar g.d.p. growth the same for the way down for these guys to take profit from destroying the economy they need to make the collapse bigger and bigger and bigger no question that created a financial cuisinart and it's a fifteen trillion dollar economy and they dump it in the quezon are and then they chop right. and then what's left. there they sell for you know what the christmas bonus for a scavenger of another country thanks eric thanks so much for being on the kaiser report thank you max that's going to do it but don't go away because it's much more coming your way so stay right there. twenty years ago the largest country in the. disappearance or the. ability. to get a job. where does it take to. i welcome back to that kaiser a part time now to turn to economist john mcdonogh see the former c.e.o. of hushmail he's a former chief forex trader at visa he's also a blogger at monetary future he's been writing about bit coin lately so we're going to talk to him about bitcoin john but tell us a lo

it's it's the opposite of how we have to encourage more and more debt in order to have one dollar g.d.p. growth the same for the way down for these guys to take profit from destroying the economy they need to make the collapse bigger and bigger and bigger no question it created a financial cuisinarts they take fifteen trillion dollars economy and they dump it in the quezon are and then they hit chop. and then what's left. you know they sell far you know what their personal scavenger you know the country thanks eric thanks so much for being on the kaiser park and thank you max that's going to do it but don't go away because much more coming your way stay right there. that are killing us here well as a. supply side that's never around say. a song called still with me are i think garbage every day. from the memories. i have so much so long time. i was ashamed. i was ashamed that i didn't. i was ashamed that i hadn't a clue why i got my arm i got my legs. in the my. car i would be out of knowledge i was a boy. now believe what i was going on once or i think. that i was a book so. most older

it's it's the opposite of how we have to encourage more and more debt in order to have one dollar of g.d.p. growth the same for the way down for these guys to take profit from destroying the economy they need to make the collapse bigger and bigger and bigger mostly that created a financial cuisinart and they take fifteen trillion dollars economy and they don't put in the quezon are then they chop right. and then what's left. there they sell for you know what the christmas bonus the scavengers in other countries say sarah thanks so much for being on the kaiser park thank you max that's going to do it but don't go away because it's much more coming your way so stay right there. in the news here oh she's available in the ground shirts immediately to the ritz carlton. hotel the chilly millennium hotel in chile you can see all t. in censored. row so still no car. there till macau seventy shamar colors also told you so this is so new macau. with resorts much less really close its own look at riviera hotel macau centro tell me. i welcome back to that kaiser report time now to turn to economist jo