of the reagan economy and the idea of supply-side economics did not necessarily drive the american economy. the reagan years actually turned around the tax cuts. they've made some difference. he also diverted the attention away from the economy. he brought of the fear of the soviet empire and the cold war. america became focused on a different set of problems in the economy. this will turn the public's attention to other issues. the he will talk about running government a more efficiently. that is the same thing that president clinton did with the reinventing america. this president came in asking vice president biden to have a task force. we will go back to that. we will have the middle class task force. we need to see that they are dealing with the problems of the middle class. what you will see is that the focus will be on the environment. this is an administration focusing on ways to move our dependence on foreign oil. we are talking about solar projects, a wind projects. we are looking to use federal dollars. we will talk about how this is creating real jobs. they will be talking abou

we are told that the fed is a great stabilizing agent in the economy. we should not be questioning it because it brings scientific management to bear on our money supply. who could question that? this is for our own good. even the left which prides itself on its slogan question authority falls completely silent when it comes to the fed. that is taking question authority too far. i intend to do that. we are inclined not just to accept whatever we are fed by the establishment especially when the establishment has been obviously so wrong. we are inclined to ask fundamental questions that are normally passed over. normally what happens when there's an economic crisis of this kind is we get people on one side saying we need to blow borrowed money on non such project and that will make people rich and the other side says let's print up a lot of money. the first two are complete the juvenile and will make the situation worse. this has nothing to do with austria on lot of early figures in the school came from austria. this is important because the austrian schoo

or to the whole economy? and if so, what's the philosophical justification for the interference in the right of contract of a willing lender to loan as much money as he wants to, to a borrower? >> banks. the justification is that your right to lend o'barr on an unlimited basis and/or your ability to hold the entire economy hostage begins. multiplied across the economy borrowing without any room for error just results in nationalization. we saw this in the 30. we saw it again over the past two years. and we can't -- one of the lessons of the modern way of creating credit through securities is you can't protect credit from the excesses of speculation just through the uninsured deposits. we have to have some consistent limits across these financial instruments, because these are the instruments of credit. now you still have fluctuation, optimism, pessimism, and you should. but you can't hold the economy hostage. we've always had limits on borrowing, even outside of insured deposits. margin requirements for stocks

the emerging economies. have a year ago it in the penal year i made two points, one was that the recovery will be relatively muted given the size of the fall in production that we have experienced in the second observation was that the strength will depend on the emerging economies because emerging economies have become of the driver of growth in the world economy. that's especially true for emerging asia, if you look at their contribution to growth. not the size of the economy is that still only 25 percent of of world economy but their contribution to growth was more than 50% during the boom time for the crisis, but much more important their contribution to growth and investment is significantly larger than the contribution of investment. !a&!u&@ Å >> their production levels are higher than in the crisis. while in the income country, production is still 12.5% below than before the crisis. you see a big difference between the emerging economies that are really leading the recovery, and the high-income country

the u.s. you economy. i will say this. m in immigrant sending countries. and we need to think about that. i think that it would be very good for the foreign press to underscore that, that we need a complementary set of economic policy discussions in the immigrant sending countries that have to complement this immigration reform because the bottom line is, if we do it right, there's going to be less demand for easily exploitable low-wage labor coming into the united states. >> we have time for one more quick question. the gentleman in the back. >> bob samuel son, "newsweek." this is for the study's author. i'm a little bit perplexed as how you can describe the period of the late 1980s when with icra was implemented as a period of weak labor demand. unemployment peaked in december and november of 1982 at 10.8%. the average in 1984 was 7.5%. it continued to go down until the recession of 1990/91. so the period of immediate implementation was a part of very strong economic and labor market growth. >> well, i could put up the gr

and so, if that 50 mile-an-hour train we call the u.s. economydoing very well, as it was in the 1990s when we were creating 22 million jobs, even some mistakes done bysy makers, that economy could absorb. and so, in the year 2000, at the end of the year 2000, had you been sitting as the director of the aggressional budget office, you would have been telling us, we're looking at budget surpluses for as far as eye can seeing something over 5 trillion dollars, correct? >> yes. i think that's right. >> so with the inauguration of new president in 2001, would you have been advisinging that president, mr. president, looking at 5 trillion dollar deficit over next 10 years. >> surplus. >> that is the train moving in that direction. unfortunately you were not the budget director in the year 2001. you're the budget director in 2010 and rather than looking at a budget surplus, you're advising this congress and the president we're all looking at massive budget deficits. but those deficits, that are massive, weren't created last night, or even last year, corr

and so, if that 50 mile-an-hour train we call the u.s. economyis doing very well, as it was in the 1990s when we were creating 22 million jobs, even some mistakes done bysy makers, that economy could absorb. and so, in the year 2000, at the end of the year 2000, had you been sitting as the director of the aggressional budget office, you would have been telling us, we're looking at budget surpluses for as far as eye can seeing something over 5 trillion dollars, correct? >> yes. i think that's right. >> so with the inauguration of new president in 2001, would you have been advisinging that president, mr. president, looking at 5 trillion dollar deficit over next 10 years. >> surplus. >> that is the train moving in that direction. unfortunately you were not the budget director in the year 2001. you're the budget director in 2010 and rather than looking at a budget surplus, you're advising this congress and the president we're all looking at massive budget deficits. but those deficits, that are massive, weren't created last night, or even last year, c

where possible to the extent possible into the global economy. it is tied to the market economy. and where it rises, it does bring very different attitude towards religious values and towards dealing with the west and towards issues that particularly matter to us. which is extremism, which is attitudes toward al qaeda, etc. it is not secular. in other words, and we shouldn't expect it necessarily to be. what matters is not whether or not it's secular, but what kind of engagement doesn't foresee, what kind of attitude does it see. now, middle-class and of itself is not a huge amount. you don't need -- is not the entirety of society. but we don't have anywhere stable, prosperous democracies and you have stable, prosperous middle-class. and so in other words, muslim codgers are going to go the way of latin american countries, eastern european countries, they have to produce that segment of society. and we also know that when you have that kind of a middle-class, and when it can define and dominate the public countries, then you see a shift in a direction in which those countries thin

the negative feedback loop bacb to the economy. hose aspects of this particular cycle that had so much to do with the intensity of the downturn. . . cycle that had so much to do with the intensity of the downturn. now what about the reactions of the policymakers to this? i think i would have to say as i have always said in observing policymaking with regard to the ideal situation in the economy and what we can create and a test tube in macroeconomic policies to get what we should get in terms of the objectives and the timing you know frankly that is impossible in the practical world of policymaking because too many things interfere with that. what he can do we cannot do in what he can do we cannot do in the laboratory of the feder policy makers. i think once recognized leader in 2007 by the federal reserve and the congress and the bush administration and in the obama administration 2008, 2001 policy actions were taken fast and furious and we've heard about that from allen already today. and in the too late, too slow, too timidly and

households, not the overall economy. i am also heartened to see there was a section in the study with the headline effective immigration reform must address future flows. i wish i could have every member of congress chant that over ten times each morning before they tackle immigration reform. if we just legalized the 11 million who were here illegally and crackdown on in enforcement, toughen enforcement we are just doing 1986 all over again. that is with the immigration and reform act was about. the missing leg of this tool as secretary napolitano put it, right here last month, is to make a provision for future flows, some kind of temporary worker program, guest worker program that is essential. if that is not part of the immigration reform, it is not worth doing. we are just setting ourselves up for failure. itis want to point out that kate who did come out with the study and i have a few copies if anybody wants it but again the results were remarkably similar. the cato study is based on the model that is actually used b

so the economy slows down. hat is the idea of maintaining -- deflating, is to make the economy slow down so that prices would fall. eventually they will start to rise again, but will take unemployment in the interim. there is no way we can do this and keep it on an absolutely level playing field all the time. the best we have done -- the federal reserve is now 90 some odd years old. the best period it had was from 1985 approximately to about 2003. we had low inflation and rapid growth. and the best evidence of that is that people stopped complaining about the growth rate. we had minor recessions but not big recessions. we have the longest period of sustained growth in the history of the united states. looking back on that, what did people complain about? the distribution of income and they say this and that about the period -- but that was the best period for macroeconomic stability. problems of education, productivity growth, those things were problems that create the difficulties in the distribution of income

and for the help of the economy. learly, it's a very, very critical -- crucial issue that we try to address the cost issue in health care. >> thank you. we share your concern. let me move to the financial regulatory policies that chairman dodd has put a bill forward, a bill has also come out of the house. and one of the issues is the to the to fail issue. and i think everyone of us are concerned about a. we have different approaches to that issue, but let me ask you this. in chairman dodd's proposal, there is a systematic risk resolution mechanism that would allocate the risk, attempt to allocate the risk, and it would exempt community banks at a 10 billion-dollar or below level. i have concerns about using the asset test, because at $10 billion you could include funds that are highly leveraged and inherently risky to our financial system. but you would also exclude asset heavy midmarket committee banks that pose no threat. do you have a recommendation as we are working through this, for how you could measure a financ

rkers in the economy? kers in the economy? well, in our economy right now today, about 70% of the economy is driven by consumption will. that means it's driven by the money that you and i and everybody else spends. so if you take a small but not insignificant chunk of workers and you give them a raise and you give them better working conditions, then those folks will have more money to spend, as the prior research says, they invest more in their communities but they also are going to increase their spending on basic goods like food, housing, education. that's going to have a positive effect for the economy overall. it' going to boost economic demand especially in low-income communities, and a positive reverberating effect throughout our economy. that's exactly what the papers measure, the positive reverberating effect from paying these workers the wages that other workers receive. but, second, there's also a productivity gain. you have a lot of workers here in this country who, because they do not have the

, the older economies, and the emerging economies. question is how do you explain that? what is the outlook for the feature-term future for these two major croups, the merging economies and the older, established industrialized economies. the first person to whom i would like to put that question is hans timmer. >> thank you very much. phil said that the recovery is very synchronized in nature. that is true. we were talking about global downturn and global recovery. the fact that is synchronized, given that fact, it is very interesting to see that there are major differences between the emerging economies and the rich economies. and that are major differences within the developing world, within the emerging economies. half a year ago in the panel here, i made two points. one was that the recovery will be relatively muted given the size of the falling production that we have experienced and the second observation was the strength will depend on the emerging economies. because emerging economies had become the driver of gross in the wor

certain practices from the mature economies into the emerging economies. . mature economies into the emerging economies. >> i would like to move to the next question. this gentleman on the second row. >> my name is james bond and i work at a meter, which is part of the world bank group. we spent a lot of time on the financial crisis. my question is to philip suttle, and i want to ask him what will happen to the pace in europe, portugal, italy, ireland, greece and spain. in terms of what an unwinding of the eurozone would look like if it became unmanageable and the whole place falls apart. >> good question, and i'm sure desmond will have comments about this as well. i worry because precisely those links are so tied. you know, we have legal structures and physical structures that are not easy to on one, compared to, say, argentina going off -- or britain during of gold in 1991. i think what it leads one to is the conclusion that -- i will not use the akron, but those countries that you mentioned, they have to tough it out. you would have to use multi year aust

let's just focus on the crises in the wealthy economies. and so, we focused on what we later khaldun you will see it in the book, the big fight. the big five for the famous nordic crises, sweden, norway, finland in 1991, spain in 1977 and the biggest of all, in the world's second-largest economy, japan which began in 1992. and, the basic-- and this is not saying it with hindsight. at the time we said we really are following the script here. these crises were preceded by a big asset price balloons, the equity markets and the real estate markets, lots of indebtedness of. we have been running huge current account deficits, and we compared the u.s. data to the average for these crises. in the run-up and the subsequent after the crisis unfolds in their concluding remarks-- the concluding remarks be presented were we will be lucky if this doesn't happen again. what was the response, even in 2007? we are not an emerging market so these are not emerging markets we are talking about. these are advanced economies but the perception was the same, this

the economy is on steroids. you ve a huge stimulus now. the fed is buying up mortgage-backed securities. rates are low. what happens when all of this ends? nobody knows. there's not enough demand out there because consumers are not -- >> you heard dr. romer say it can't end. >> consumers can't borrow as they did before. houses are worth 30% less than before. we're going into an economic territory that we just don't know anything about. we've never been here before. and that's the big issue. it scares everybody in this town for 2010, it's scary for the economy overall. >> can the president get congress to go along with what he wants them to do? >> i think with minimal steps. which is what he's really talking about. i think a lot of this, george, is psychological. the fundamental questions, a lot of it is psychological. businesses are hiring temporary workers because they're not confident that this is going to be sustained. consumers had a good christmas season. but then they have been pulling back. they're not confident it will be sustained.

american people have -- do things to expand the economy. if they are not confident, they will do the opposite. their limited opportunities for the president. the lever does not exist that you could: put millions on payroll, but the margins incentivize some activity. the president spoke about a need for a jobs credit. i have and to think that makes a lot of sense. and economists said, you should put that out there. those businesses ready to expand very likely will allow them to expand, so there are things you can do with the margins, but certainly between now and the end of next year there is no lover to pull to put massive amounts of people on payrolls. >> you talk about the economy. how can washington improved consumer confidence. the more you talk about how well this is doing and the less likely people feel it in the real world, the more washington seems to be detached from reality. that is one of the dangers. >> the investment banks, which will -- which caused the wreck were the first to show record bonuses. people are furious about a lot

contrast this with the advanced economies. we're looking at very high, rising unemployment rates the much of this year which will weigh heavily on growth. this will contrasts greatly with those from previous decades. what is the repercussion of these differences in their outlooks? capital increasingly is knocking on the doors of emerging economies looking for investment opportunities. the growth fundamentals are stronger and yields are higher. in ways there policies have been quite prudent. >> the third question i would like panelists to address even though you may have already hinted at it or spoken explicitly about it is" really major risks do you seek? and what degree of confidence do you have for your expectations? the first person of like to address it is uri dadush. >> ok, first of all there are downside risks to this forecast. let's take a consensus. there are both upside and downside risks. i want to stress that. it is not just about downside risks. the second thing, the gamut of possible outcomes is more narrow than it

if that is a key time for the labor market and economy. it's the economy going again. i did not think you need a large impact to make a significant and -- difference. the other issue with the jobs tax credit which is a very reasonable concern is the concern about gaming. there is a potential for that. but there are ways to design it so you can mitigate the most serious forms of that. we will hear about those with the administration announces the tax credit today. there are a couple of other versions in the senate. once we take a good close look at that, i think it will become clear that it was designed in a way to address this issue. i think it is -- at the end of the day, i could be wrong. who really knows? it is worth a shot. moreover, cbo when asked what they would do to jump-start the job market, at the top of the list was this job tax credit. these are all things said they considered and that is at the top. i say let's give it a shot. one other quick point, broody mentioned the bonus appreciation. there is some evidence that it worked

xxxxxxxxxxxx >> our final big topic of 2009, the economy. e first quarter of 2009 saw the economy decline at an annual rate of 6.4%. the government offered cash for old gas guzzlers during the summer sparking auto cash for clunkers you may remember, but the economy continued to hemorrhage jobs. the unemployment rate hitting 10.2% in october. the highest figure in 26 years. in early december, the president hosted a jobs summit at the white house and this was the year, as you see the dates there on the timeline for the economy. we're back with the fan. a.b., an overview? >> well, i think that this, here we sit still one in five american workers unemployed or underemployed. we're looking at a recovery where the economy's going to grow, but we're not going to see improvement in unemployment soon enough. this is still a huge, huge problem. we have deficits growing, we have to continue to provide unemployment benefits. we have no revenue coming into the government at the rates we need to cut into the deficit. this is the political problem that the

the first quarter. brit, where are we with this economy? lways been the chance that the economy, because the united states economy is fabulously resilient, might despite everything begin to recover. and sometimes when the economy begins to recover, it takes on a certain momentum and the next thing you know we have people being hired right and left. we could have a robust recovery in process, where even if the unemployment rate hadn't come down that much, people would be convinced that we were in a recovery and there was a lot to hope for and the political weight of the downturn would be off the democratic party. these most recent job numbers that that is less likely to be so. you noted that the president is now going to make this the focus of 2010, which suggests that he didn't really make it a focus of 2009. what did he do? first, it was -- he went along with that staggeringly wasteful and expensive stimulus package, which has not had the desired effect, obviously. and then he made this turn toward healthcare reform, which has little if any

for most people thatç is the economy. r job? d that's not a good story for most people. >> what about that, mr. barbera? >> iç agree with dean very much in the sense that jobs are key. the take i have which is not the conventional wisdom right enveloped the economy late last year or early lastç year and throughout much of year was a panic about cash. you thought your banks might go bankrupt. you thoughtok they might pull your wires and so you slashed inventories and you also slashed your work force. if youok look at the data in terms of the amount of job decline over 2009 it was wildly in excessmy of what you would have expected based on the g.d.p. decline. most everybody expects a snapback forç inventories. i do too. but i think you're going to be surprised about the snapback for employment as somebody who sort of has to deal withç the details of the monthly pulse of the numbers. if you look at that sharp decline in joblessç claims, that surge in the purchasing managers index, those traditionally are followed by mate

first, talk about the politics of it. is this economy where we are right now and what's happening right now going to help or hurt the democrats, because we've got elections in 2010. >> it's going to hurt them. economy is weak. the chart you showed was really, really telling. from 4.9% to 10% is a big drop and it's going to take a lot to go back up. people are still going to be feeling the pain. >> joann? >> it is all about jobs. as you pointed out. jobs, jobs, jobs. as long as unemployment is there we'll have a lot of disaffection among voters and not only that, another really important issue that's going to come up in 2010 is going to be the foreclosure rate. right? you've got something like 14% of people who are already behind in their mortgages or in foreclosure. when people see their neighbors turned out of their homes losing homes, that's going to become a real political issue. >> and those are tight. ob obviously. the more people lose their jobs the more homes get foreclosed. >> unemployment goes down slightly. democrats get hurt i

the economy actually created jobs late last year in november. when employers added 4,000 positions, but that small, little gain ended almost two years of job losses and then by december, the layoffs resumed. >> oh, i so wanted it to be differ. >> i know. 85,000 jobs lost in the final month of the year. >> the grand scheme of things, has not been terrible compared to what we've seen in the last year or so. >> still, 85,000. >> a lot. >> unexpected and since the recession began now 7.2 million jobs lost. >> let's break that down. unemployment rate in particular, which is 10% on average. the jobless rate for blacks, hispanics and teens is rising. it's much higher than the national average of 10%. so look at the screen there. adult men van unemployment rate of 10.2%. higher than the average. adult women, 8.2%, why some call this a man's session. the manufacturing and construction jobs dominated by men have been heavily lost, whereas jobs dominated by women in education and health care have been growing. teenagers. unemployment rate for teenagers able

eastern time is the economy. president will describe detailed initiatives court middle-class families. details you can look forward to in the president's speech to not -- tonight. denver on the independent line. you are next. caller: thanks a lot, greta, you are doing a great job. host: what are your thoughts about the speech tonight? what would you like to hear? caller: there are a lot of things i would like to hear but specifically i would like for the president to talk about what he plans to do about local crime that is rampant across the country, and i would also like for the president -- all classes of americans, he needs to address that, i think. and all the callers calling in talking about what he needs to do here locally first -- i would suggest they need to get a little bit more education. but the main thing i would say, because i want to give someone else a chance, is especially those callers that are unemployed, don't have a job, if they go to their local library and just ask -- say they want to see th

bush years not especially successful, that the economy's problems today are due primarily to lack of demand and not supply. why did the bush administration, in your view, get it wrong? reaganomics, that is, and supply side economics. guest: well, keep in mind, the president's father raised taxes in 1990, and for this he was very widely criticized, and it led to his defeat in 1992. and i think that his son was never going to make that same mistake, and i think he felt that as long as he just kept cutting taxes and cutting taxes and cutting taxes that a large element of the republican coalition would be with him. and no matter what else he did. and i think that as a political calculation, that worked. the problem is it was irresponsible. as was much of the policies of administration. sh ]dj just for for example, i'm incredulous that so many republicans are complaining about the cost of the healthcare measure that's being considered, that at least is being paid for in one way or another, whereas they put forward a proposal to expand drug benefits for people on medicare and did not pay fo

does the housing market keep the economy in the dumps? >> it keeps it from gathering a stronger head of steam. i think if we step back, we can see that the home price decline has bottomed. it doesn't look like there's another huge leg down. however, with all these foreclosures still coming in the door, as it were, the chance for the housing sector to drive the economy stronger and stronger is quite low. it's not going to happen. >> glor: okay, our soothsayers. we appreciate both your time. happy new year to both you. still ahead here on tonight's cbs evening news, what is the reason for the huge number of whales gathering off the coast of california? >> glor: california's scenic santa monica bay is getting crowded again and nobody is complaining. whales have returned in force. scientists don't know why for sure, but one of the ocean's smallest creatures may be luring the biggest. sandra hughes explains. >> reporter: tracking a mystery, they follow an ocean footprint looking for the second-largest mammal in the world. >> that look likeaise

a year ago the economy was in freefall. ob loss was 714,000 per month in the month of january alone. retirement savings accounts had plunged by two trillion in the first quarter of 2009. the record budget surpluses had been converted to record deficits for as far as the eye could see. as president obama and this congress began 2009, this was the context, this was the economic and fiscal legacy of the previous administration. too many americans today still feel the pain of the recession. we received news today from the testimony from dr. elmendorf that the economy, we believe, is out of recession. but nevertheless, there is much work to be done to recover to full capacity. cbo's report today confirmed that the actions we have taken over the last year have pulled the economy back from the brink. cbo's report confirms that gdp will grow in 2010 and beyond and that the recovery act has had a positive effect. the report also confirms that the recession has taken its toll on the budget's bottom line, that focus on rescuing the eco

up again so people began to believe that the u.s. economy really was super resilient and recovering everything, so we were -- >> host: i said that at the time. you probably did, too. [laughter] >> guest: we were lulled into a false sense of security and the other is imaginary to but i don't like the metaphors that compare this to 9/11 because so many people died at 9/11 so it's not the same thing that there is one part that makes me -- which i think is a parallel. there were people who said we were vulnerable to terrorism. there were people who said new york would be targeted after all there had been a terrorist bombing. there were people who worry about terrorists commandeering an airplane that nobody charged with the security of the country ever imagined that al qaeda was so organized ticket hijack so many plants and fly them to so many buildings of the same time. well, similarly in this case i honestly don't think it occurred to anybody that so much of the financial house of cards was built on the assumption that house prices wouldn't fal

a year ago the economy was in freefall. month of january alone. retirement savings accounts had plunged by two trillion in the first quarter of 2009. the record budget surpluses had been converted to record deficits for as far as the eye could see. as president obama and this congress began 2009, this was the context, this was the economic and fiscal legacy of the previous administration. too many americans today still feel the pain of the recession. we received news today from the testimony from dr. elmendorf that the economy, we believe, is out of recession. but nevertheless, there is much work to be done to recover to full capacity. cbo's report today confirmed that the actions we have taken over the last year have pulled the economy back from the brink. cbo's report confirms that gdp will grow in 2010 and beyond and that the recovery act has had a positive effect. the report also confirms that the recession has taken its toll on the budget's bottom line, that focus on rescuing the economy will show up on the bottom line.

they campaigned for office suggesting they could fix the economy. presidents do not have as direct control over the you have unemployment rate is they would like to suggest. i wonder what you think about this white house's ability to affect unemployment between now and the important election coming up? guest: it is marginal. our describe the ship of state and the engine room. people believe if you push the right hon and energy buttons and levers and get all the right tax credits, the ship of state will run just fine. it is not a simple. in my judgment, it is about confidence. if they are confident, people buy a home, by sue, take a trip. if they are not confident, in a defer purchases -- there are limited opportunities for the president. the leaders to not exist for them to pull that lever and millions of people are put back on apparel. but you can at the margins and stimulate in incentivize. the president has spoken about the needs for a and wage and tax credit, the jobs credit. you should put that out there and say, if you're is the amount of money

but i watched the economy and the markets and been at the fed and you cover the economy and especially the fed for "the wall street journal" for many years and so far as i know, neither of us were out there issuing dire warnings in 06 or 07. why did this crisis catch so many people by surprise? >> guest: that's a good question and i'm not sure i have a complete answer. some of my colleagues in the press will make a question like that and point to have a dozen stories we did in the run-up to this crisis. and they would say we did see it coming but i tell them look, if we had done a better job and had listened more to the cassandras and less to the people who told us everything was going to be all right it might not have been so bad. so i want to start with the beginning saying the press didn't do as. >> host: neither did the academic -- >> guest: no, but i want to start from the beginning. actually one of the frightening things is the litany of people and the checks on the system that failed. it's hard to find something to function right. the best i can do is to say i think two things.

there is very little money moving through the economy right now. on the money meant for them from their relatives overseas, and because so many people are out of work there's no wages being paid. so it's like the circulatory system seizing up. there's just not enough money moving through an economy that's ready to spring into life. >> warner: and what about shelter, ray? president preval issued an international appeal earlier this week for 200,000 family-sized tents. is that going to be enough? >> suarez: well, there are already complaints from people on the ground that those hundreds of thousands of tents are aren't going to be enough, and if you accept the figuf some figure of some one million people out of shelter either because their homes have been destroyed outright or they sustained enough damage or because in the aftershocks people will not occupy them, yes that number is short. but the more disturbing part is, as i mentioned, more than two weeks into this tragedy, the tents are very little in evidence. you can get antibiotics from halfway

which is what the fed normally does. and an economy that was collapsing on employment going up and bernanke came back to his colleagues at the open market committee that does these things and says we've got to keep coming down to see you go and they did. and they are still there why. why did they do that? >> guest: the way the fed deals with a slow economy is to cut interest rates so it's easier for people to borrow and the lesson they felt they learned from the past from japan and from the 30's and things are bad the fed has to do a lot, it's a on the accelerator. as you know they didn't stop there. once they got the race to zero they kept going and found other ways to put credit into the economy buying securities in the markets to put money out there. so this is a grand experiment and frankly we do not yet know how this is going to turn out. some people think this has a worked so well given the amount of credit the fed put in the economy would have expected the economy to be doing better to let other people think they've put so much

chairman, the economy is improving. we have put in place, a different policies in the last eight years. at least part of that when we look at the recovery act, i was very pleased that the effort by championed on class for concurs had such an immediate impact in a small amount of time and some economists have credited that with a boost of the short-term boost of gdp. it is not insignificant. it is important that different policies are beginning to swing this in a different direction and that is important. now we again are focused at are focused on middle-class tax cuts and on and innovation, a jobs, and i think that is very significant. i wanted to ask mr. elmendorf and also join my colleagues and thinking you for the incredible job that your staff have done project early on health care which was incredible, incredibly stressful 24 hour day effort and think each of you for doing that. >> thank you senator. >> you talked about infrastructure spending has a delayed. i assume the dollars that we passed last figure in the rec

contrast this with the advanced economies. we're looking at very high, rising unemployment rates the much of this year which will weigh heavily on growth. this will contrasts greatly with those from previous decades. what is the repercussion of these differences in their outlooks? capital increasingly is knocking on the doors of emerging economies looking for investment opportunities. the growth fundamentals are stronger and yields are higher. in ways there policies have been quite prudent. >> the third question i would like panelists to address even though you may have already hinted at it or spoken explicitly about it is" really major risks do you seek? and what degree of confidence do you have for your expectations? the first person of like to address it is uri dadush. >> ok, first of all there are downside risks to this forecast. let's take a consensus. there are both upside and downside risks. i want to stress that. it is not just about downside risks. the second thing, the gamut of possible outcomes is more narrow than it

the economy is growing again. it's growing so slowly we're only hoping next year we'll begin to create jobs again. we have millions of jobs that haven't come back yet. that could mean depressed consumer spending, bad for consumer marketers. it also could mean a lot of political populism, hostility to business and trade that could hurt us going forward. >> andy, we're coming into the midterm election year. with the public perceptions about the economy where they are, where do you think the economic talking points will be for this campaign? >> i think the economy, jobs, jobs in particular, is going to be the big thing, maria, for the election coming up. this whole cycle is really playing out true to form. the market responds first, then the economy gets its footings, jobs the last thing to recover. if the president and his administration can help make that unemployment rate go down, i think they'll fair well in the midterms. >> how does the financial services sector look in the coming year or five years? i mean, obv

, the people with a strong position in our economy? i think that debate will very much affect the elections. i also think we're going to have a kind of after-effect of our big health care debate. i think what you saw among religious groups, particularly christian religious groups, were a real difference between those who laid the heaviest stress on the moral imperative to getting everyone, or as many people as possible, covered through insurance; versus those who felt that the major emphasis on funded and how in this health care debate. i think that's going to have a continuing effect, because i think there is this dialogue, certainly in the catholic church that'm part of, but i think in all of our traditions, between those who believe the central emphasis of our religious group should be on a certain relatively narrow-- though they would way very important-- list of moral questions: abortion, gay marriage, stem cell research; versus those who say that the emphasis should be on a much broader agenda having to do with social justice and

the question is, where will the economy go in 2010? prices and the price that you pay at the pump? christine? >> hmm. we're going to peer into that barrel of crude and see where it's going to go. christopher steiner author of "$20 per gallon" how the rise in the price of gasoline will change our lives for the better. and steve hargreaves from cnnmoney.com be, right here. let me talk to you first, christopher steiner. you think oil prices are going higher. why? >> three reasons. one is supply. if you talk about the developing world, it's not so much the price that matters in the u.s. you talk about china and india. we've all heard cliches about the rising middle classes. that's largely true. right now there is a billion people on the earth who live lives like americans do. by 2040 there will be 3 billion people. long-term oil prices and demand are going to go up. secondly, supply. the iaea says we have to find three saudi arabias by 2030 to just keep up with current demand. to keep up with future demand we'd have to fine six saudi arabia

the economy is only now back on track. the white house figure the best thing for markets and certainty was to stick with the horse you already have host: you write that ben bernanke is in the midst of fighting for the fed's future on capitol hill. members are poised to cut back on the power of the central bank. guest: well, speaking of the financial reform legislation, the house has already passed the bill and the senate is still in the committee process. there is a strong sense that they want to curb some of the influence of the fed, especially in the senate to. also some of its supervisory powers. the administration's proposal had a central role for the fed. the house cut it back a little. but the senate wants to curb the role even more. you see this fed backlash over the months. host: our guest was educated at dartmouth college and at the london school for economics. the next call comes from easton, pa., on the independent line. caller: my question -- i only took one course in economics. the question a professor raised w

a new poll shows 46% of government employees believe the economy is getting better. but the numbers flipped for folks working in this private sector, 49% think things are worse and that has patricia powell flipping out? hide for cover! >> charles, i have to tell you first, my comments will not be made towards the military. the government workers who protect us all. >> an asterisk. >> i have an asterisk next to it. government workers, of course they are thrilled and good times are -- treasury doors have been opened up to the barbarian horse here and if you look at the salaries, 100,000-plus incomes in the government workers, the group has grown 50% in the last two years, during a period where we have been losing jobs like crazy in this country. if you look at the rate of growth of government pay, it has been growing at twice the rate of the overall economy, of course they are having a wonderful time and having a wonderful time on your dime. >> federal spending is what, 28% of gdp, the highest since we were fighting wars. >> and the money is rolling in and it is impossi

a year ago, the economy was in freefall. job loss was that 14,000 -- in january alone. mericans retirement savings account plunged about 2 trillion between the first quarter 2008 and the first quarter of 2009. the record budget surpluses of january 2001 have been converted to record deficit as far as the eye can see. if president obama in this congress began 2009, this was the context, this is the economic and fiscal legacy in the previous administration. too many americans today still feel the pain of the recession. we received news today from the testimony from your elmendorf that the economy we believe is out of recession, but nonetheless there is much work to be done to rebuild the economy in recovery to full capacity. cbo's report today confirmed the action we've taken over the last year have overcome back from the brand. theo's report confirms that the gdp will grow in 2010 and if the recovery act has had a positive effect. the report also confirms that the recession has taken its toll on the budget's bottom line, the folks in search underestimate economy is still

the american economy, the worldwide economy rests on what the federal reserve does. this is the tpefrb that told us -- this is the federal reserve that told us the subprime mortgage would not cause an economic breakdown. ben bernanke told us that fannie mae was well capitalized a few months before their collapse. we have to depend on the leadership at the federal reserve to tell us the truth. if our monetary system crashes because of bad policy, everything america's worked for, all our material wealth will be gone. and this country will see a crisis the likes of which it has never seen. this body is not taking this nomination seriously enough. we're moving ahead quickly when what we need to do is have a full audit of the federal reserve to look at what has been going on, look at their involvement with the current crisis and to make sure that they're on the right path. the constitution gives the congress the responsibility to protect our monetary system. years ago we delegated that to the federal reserve, but that does not relieve us of our responsibility. to confirm

there is very little money ving through the economy rig now. n the moy meant for them from their relatis overseas, and becausso many people are out of work there's no wag being paid. so it's like the cculatory system szing up. there's ju not enough money movinghrough an economy that's ready to spring to life. >> warner: and wt about shelter, ray? president preval issd an international appealarlier this week for 200,0 family-sizedents. is tt going to be enough? >> suarez: well, there a already mplaints from people on the ground that tse hundreds of thousands tents are ar't going to be enough, and if you accept the guf some figure of some oneillion peopleut of shelter either beuse their homes have been destroyed outrig or they sustaineenough damage or cause in the aftershocks people will not occupyhem, yes that numbers short. but the more dturbing part is, as i mentione more than two wes into this tragedy, the tents are very little evidence. you can get antibioticfrom halfway around the world, e syringes, gae pad, sneakers, hirts, but the tents th

and later in the morning, the carnegie endowment for national peace hosts a forum on the world economy in 2010. >> on c-span 2 this morning long-term care services. who provides long-term services, who gets them and who pays for the services? and whether or not congress will include long-term insurance in their final health care bill. that's live at 8:30 eastern. and later in the morning on c-span three, a forum on energy efficiency. those from government industry, and academia will discuss smart technology. that's live from the national press club at 10:00 eastern. the federal government reported a slowing in the growth of health care spending in 2008. but it levels it's still outpacing the overall any. more on the report from the centers of medicare and medicaid services. susan host this isçó 55-minute event. >> i'm susan denser, happy new year and welcome to our briefing on health care numbers. that is ritual as the medicare and medicaid services as well as health affairs to bring out these spending numbers every year, and we're delighted to be able to do that once more. this year w