doubt a weaker economy works for the budget and stronger economy is a lot better for the budget. the challenge is how to move the economy. is not easy to move $15 trillion economy. >> thank you. i do have a question about sequestration by want to submit for the record. as part of situation as we're looking at we need to understand the impact of that and i appreciate the information you put out on that but the significant impact to sequestration needs to be understood by the committee. i submit that for the record. and will turn it over to mr. hensarling. >> revenues today are roughly at 14% of gdp. doesn't your latest estimate under a policy baseline show that revenues go back to their historic norm of 18% in 2014? >> a little over 15% today and improvement in the economy and other factors that we push off. >> the alternative fiscal scenario which is the policy baseline shows spending going from historic average of 20.5% to 34% of gdp. is that correct? >> that sounds right. >> with respect to revenue one is episodic related to lack of economic recovery. is that a fair assessment?

the economy is underperforming in demand is too low. the government budget deficit is a component of demand surges reza. it is an equation. huckabee wrong? raise government to deficit spending and a commie should recover. the reason this fails is the economy is a little more complicated than a simple equation. the model it is based on ignore something else in the economy a process called financial intermediation. basic function of financial markets. the problem is that when government runs more deficit spending it has to borrow the money. when it borrows the money that money is not available for private sector you say you have not increased total demand. all you have done is shifted around. now advocates for this policy will say yes but there is so much saving and people are doing anything with it. corporations are sitting on the money. yes they are but that is not an issue. they don't put it in the mattresses. they have put it available to the financial system which intermediates it to those who needed. it is fiscal -- adding to the hea

the way you get more revenue is get the economy going the government is a big winner when the economy is moving. right now, we've got -- we've thrown a big, wet blanket over the private sector economy. we' borrowed too much. we've spent too much. we're dramatically overregulating every aspect of the private sector. in our country. and now we're threatening to raise taxes on top of it. that's not going to get the economy moving. >> isn't the reality, leader, that you laid out the political playbook for republicans, and that's to make this president a one-term president. you laid that out before. is it your view that it's political malpractice to do business with the president on this point? and by taking any tax increases off the table, to either jump-start the economy or deal with the deficit problem down the road, you say, we're not going to give him anything now. the window is closed, let's have it out in the election? >> no, the window is not closed. i mean the election is next year. in case anybody forgot. it's not this year. we're in the middle now of a process that i think is go

the impact on taxes. raising taxes in this economy. that's the kind of sustenance that republicans will feed on and say, we just can't do it. and you've warned against it, as well. you think there's too much emphasis on taxing the rich? >> well, first of all, i believe that the -- that as you look at how we're going to balance this budget, and get a hold of the debt over the long run, clearly everyone has looked at it. all the bipartisan commissions, extremely good work done by alan simpson and erzkin bowles and their commission. they say you've got to have spending cuts and economic growth if you want to bring the budget back into balance. you have to have all three. and the least harmful tax increases are the ones that senator mcconnell, and people who agree with him, hate the most. and that is restoring the tax levels that were there when i was president for those of us in high income group levels. that's the one that does the least harm. i agree we ought to have corporate tax reform. i agree that in this world, where there's a lot m

all would be nice, as they could stimulate the economy. investment strategist doug roberts says it's basically the fed's attempt at the wealth effect. >> it kind of creates what they call a virtuous circle. everybody feels a little bit better because the market is going up, so they go out and spend a little bit more. and, in turn, that kind of acts as a trigger to get the economy going again and creates a circle that repeats itself. few fed watchers think operation twist will have a big effect on growth, but financial markets are counting on it. >> the stock market has really priced much of this in, and really what they're looking for in the upcoming statement is whether operation twist is really a prelude to qe3 or at least qe2.5. >> reporter: by qe3, roberts means another round of aggressive bond-buying from the fed. some experts would love to see that come this week, but most say don't count on it. suzanne pratt, "nightly business report," new york. >> susie: our next guest has some strong opinions on how to get the u.s. economy growing

the u.s. economy. the statement that came along with the decision read, "there are significant downside risks to the economic outlook, including strains in global financial markets." >> "significantly" wasn't in the last three meetings. he put that in this time, and that, i think, had a little trepidation to traders' minds when they saw that. we knew the economy was weak, but now it's getting significantly weaker going forward. that was a key word. >> reporter: some experts also noted that investors were upset about the division among fed members. and, traders also said the extra bit of stimulus from the fed, in the form of reinvesting mortgage debt, barely moved the needle for stock investors. >> i wouldn't say that it's a real non-event, but it's not enough to move the market. we just don't think it's going to work. at the end of the day, is this going to help unemployment? probably not, and that's the key. we need people working to get mortgages. >> reporter: the story was a bit different in the bo

but just two months after the attacks, the economy was growing again. the recession of 1991 was caused by the savings and loan crisis, and also lasted about eight months. but, there are some important differences now compared to those periods. >> the united states economy was able to recover quickly out of those. now, a lot of that was monetary policy-- lowering rates, readying credit to build again. we don't have that flexibility today. >> reporter: best case scenario? most economists hope the economy muddles along with slightly less than 2% growth in the second half of the year. next year doesn't look much better. and it could take years before there's a serious dent in unemployment. so, whether or not the u.s. technically enters recession in the coming months, it may feel like one for many americans. erika miller, "nightly business report," new york. >> tom: stocks were broadly lower as federal reserve chief ben bernanke did not give investors any new reason to be hopeful a change in policy was coming very soon. here's today's chart of the s&p 500. af

in the global economy i mean are we asking too much of the fed right now. the federal reserve should focus on one thing and one thing only which is to maintain a stable dollar european central bank actually has the right idea they have a single mandate now they're not maybe not doing a great job of it but their single mandate is to preserve the value of the euro we have what's called the dual mandate in the united states where the fed is supposed to somehow preserve the value of the dollar but also be an economic manipulator and somehow try to generate more employment and more growth and that's where we get these easy money policies and things like that which of course as we've already discussed go really work or if they do work they give us inflation which of course is actually a net negative in the long run so the problem is the legal dual mandate isn't that's a problem but the real problem is that the politicians and the central bankers can't resist the temptation to try to artificially goose the economy there's always this pressure to artificially lower

the people that have been hurt most by the president's economy, the obama economy is the middle class taxes for the middle class. >> robert, is it responsible for any politician left or right to offer tax cuts when we're talking about a drastic need for deficit reduction. >> the drastic need is grow the economy. the president put forward a bill with many proposals the republicans support, payroll tax cuts, giving working families $1500 extra through tax cuts, great incentives for employers to create employment. romney is doing political posturing and it is an example of the type of conflict that paralyzed this economy. i would make this point to you. we have seen the economy grow in sectors of our country. we've seen tremendous growth in pittsburgh through nanotechnology. we've seen cleveland expand through the cleveland clinic or silicon valley come back. we are seeing economic growth emerge when there's cooperation between the government and private sector. the problem, in washington it's just the opposite. they were elected to oppose cooperation. >> last word, will. >> i would say

up al gore and of speaks to watford amaryllis professor michael hudson about the outlook for the u.s. economy stay with us. for the full story we've gone to. the biggest issues get a human voice face to face with the news makers. hello again the no come to swap live the interview felt an artsy a mother's love and today we're going to talk about money but other people's money and what's more important than our money. politicians and the columnist from i round the world have gathered in the russian city to. take part in the global political front the decision makers are going to discuss among other things how to avoid future economic crisis but does it mean the path out of the current economic recession is already clear and where does it lead here's the participants in the forum to wall street financial analyst professor michael. one of the goals of these two years here is love the little balls for us to find out how to reduce the gap between the rich and the poor the economic crisis doesn't shake europe and america is still a serious threat to the future of the euro zone has in doubt just rece

first of all in the american economy and it looks like that the economic problems so far have. led to a run off popularity of right now wing ideas in that says will the tea party for one year and does that mean that the us left today is incapable of offering the society offering business any any breakthrough ideas ways of overcoming the probably it certainly is capable and. because senate the representative from ohio has often said however it doesn't get much of a hearing and the left is so confused. by the fact that a democratic president obama that is leading the move to the right mr obama is known to the right of the republican party the tea party people such as michele bachmann voted against the bank bailouts the republicans voted against the bank bailouts this is a democratic program and the democrats are very much like tony blair's labor party in london moving to the right of margaret thatcher that's the irony of this the labor party's and social democrats throughout the world are moving to the right of the old rig

the economy is not a fixed pie. when you expand the labor curve, a simple economist will say the price of labor goes down and we're all hurt. the more people that work here, the more people that are chasing jobs and we're all doomed. wrong. the expansion of the available labor force creates opportunities that did not exist before. you have innovation and entrepreneurialism that increases the actual size of small and medium-sized businesses. they consume and that expands the demand curve. you have a dynamic economy for 90% of u.s. born workers that enhances their wages. the other 9% got whacked up side the head with globalization and immigration and everything you can list and they need help. getting rid of immigrants doesn't really help them. the final point is if you look at the last 15 years, 25% of publicly traded companies in the united states are essentially from the bay area region and one out of four was started by an immigrant. we have great data on this because it's all transparent. you can look it up. you c

still feels like the economy is bad. does matter in politics, sometimes stronger than reality. >> candy crowley, diane, greg, nice to see all of you. have a wonderful weekend, folks. >> the president wants $447 billion to create jobs. republicans are hardly ready to sign that check. is this about policy or politics? we'll take a look flex. sle. not with priority mail flat rate boxes from the postal service. if it fits it ships anywhere in the country for a low flat rate. that is easy. best news i've heard all day! i'm soooo amped! i mean not amped. excited. well, sort of amped. really kind of in between. have you ever thought about decaf? do you think that would help? yeah. priority mail flat rate shipping starts at just $4.95, only from the postal service. a simpler way to ship. i tell you what i can spend. i do my best to make it work. i'm back on the road safely. and i saved you money on brakes. that's personal pricing. american jobs act passed on the hill. he'll need support from republicans in congress to get that d

find out what's really happening to the global economy in these kinds of reports. for the fall we've got. the biggest issues get a human voice face to face with the news makers. to get that increase in three more months of defense take place across europe as the world's ice hockey community remembers the forty three victims of the plane crash in central an emotional ceremony has also been held at the stadium and bellamy is with the team that was supposed to play the seasons of. president barack obama lays out his much anticipated jobs and before congress this comes as stagnation of the job market in the world's largest economy raises concerns over their ability of the united states to put out how they can only price it. the u.k. government faces legal action as doctors demand a new inquiry into the shady death of an arms inspector was the man he revealed britain's new drug had no weapons of mass destruction ahead of the invasion. news from russia and around the world this is with me hugh national thanks for joining us and our top story of.

greece isn't a big part of the european economy. the fear is if greece goes down, a lot of its paper is being held by other european banks. they become ill liquid. and it could affect the u.s. financial system. but a lot of investmentors don't realize there's a big difference in the financial system today in the u.s. versus europe. in '09 after the crisis, the u.s. and the banks are very liquid. most banks have more cash than they want. the investors are more cash heavy than they've ever been, and corporate balance sheets are rich. in europe they did not reequiify or deleverage, so there's a bigger risk. and i think what has to happen in europe, is the government of europe is going to have to come together with a u.s. type plan to ensure the liquidity of the banks if there is a failure, and to let the banking system recover and reequiify. >> susie: now, investors are hoping that the federal reserve will come up with some new plan to revive the economy. what do you want to hear from policy makers? >> i think everyone thinks if we can

still feels like the economy is bad. metimes stronger than reality. >> nice to see you. thank you. >>> the president wants money to create jobs. congressional republicans are hardly ready to sign the checks. this is web-based trading, re-visualized. streaming, real-time quotes. earnings analysis. probability analysis: that's what opportunity looks like. it's all visual. intuitive. and it's available free, wherever the web is. this is how trade strategies are built. tradearchitect. only from td ameritrade. welcome to better trade commission free for 60 days when you open an account. i tell you what i can spend. i do my best to make it work. i'm back on the road safely. and i saved you money on brakes. that's personal pricing. >>> president obama wants his american jobs act passed on the hill. he'll need support from republicans in congress to get that done. that has the president questioning the intentions of some on the right. >> they supported this stuff in the past. but they are thinking maybe they don't do it this time

the economy is underperforming in demand is too low. the government budget deficit is a component of demand surges reza. it is an equation. huckabee wrong? raise government to deficit spending and a commie should recover. the reason this fails is the economy is a little more complicated than a simple equation. the model it is based on ignore something else in the economy a process called financial intermediation. basic function of financial markets. the problem is that when government runs more deficit spending it has to borrow the money. when it borrows the money that money is not available for private sector you say you have not increased total demand. all you have done is shifted around. now advocates for this policy will say yes but there is so much saving and people are doing anything with it. corporations are sitting on the money. yes they are but that is not an issue. they don't put it in the mattresses. they have put it available to the financial system which intermediates it to those who needed. it is fiscal -- adding to the hea

hello and a very warm welcome to our business update fresh concerns about the european economy have caused another wave of turbulence in the global stock markets stocks swing shockley by hundreds of points and while investors are way the chances of the meltdown in europe jacob knell for morgan stanley says russia doesn't have much to worry about so far. russia is actually a much better position and other central european countries and say turkey in the region because it has less strong trade and investment relationships with europe because it's more of a global trading country and it depends on the possible oval commodities such as all which depend on growth in emerging markets such as china and india above all so russia's fate is totally dark with the growth of china and india not at the moment looks reports and hasn't been affected by the downturn in developed markets as compared to other. countries i think russia reasonable with brazil as essentially a commodity exporter which is exposed to movements in commodity prices which are affected by global growth it's not like china and india w

obama's albatross, the economy? the congressional budget office reported this week that unemployment will remain high between now and the end -- question, why is the public lost faith in president obama? is strictly the economy or more than the economy, like are the voters who voted for change not seeing the change? >> democrats are still sticking with him. i think the problem is a combination of the policies he pursued in the first two years of unpopular with the public, most importantly obama care, and then the rotten state of the economy. when we're growing at 1% with one employment rate above 9%, there's not much to be happy about. and the ratings on key issues, jobs, the budget and the economy generally are all in the mid-20s, which is a disastrous place for him to be. >> you can buy a t-shirt that says, president bush wrecked the economy, and president obama can't fix it. and i think that's where we are. and the president from the democratic perspective has played it much too safe. he proposes modest efforts i

immigrants are a net contributor to the economy. it is easy to be distracted by the fiscal analysis which is about tax revenues and expenditures. entire categories of people at a certain phase in their life and a certain period in their economy are net users of tax resources. as it happens since we're running a big federal deficit right now, we're all net users of resources. if you add us you will up together, we're not producing enough revenue to cover the expenses of the government. people that are older, children, those are categories of people who are net drains on the economy. that's a fiscal analysis, not an economic analysis. so point number one for your friends who are not persuaded that immigration is a good thing, get them off the fiscal analysis and ask them to focus on the economic analysis. that's a bigger picture analysis. yes, a child of 7 costs money because they attend school and no, they don't work. the last time i checked, that was a good thing. later when they go on to do wonderful and innovative things, whether i

this is what the economy needs right now. the question is, if you think the economy's doing okay, i guess you're not going to act. but if you think this economy is far too weak and needs a jump-start -- so we expect there will be an entire vote on the jobs act in september. these are things that generally would not be highly controversial. things that have brought bipartisan support in the past. >> you and the president both understand politics. there will be things in terms of paying for it that the republicans won't agree to. the republicans say we can agree to certain things, including infrastructure bank which is important for creating jobs. so push coming to shove, would you rather take parts of it, or do you have to have the whole of it? >> again, there's any number of hypotheticals in the coming months, but we're going to continue to demand this type of action that is going to have a profound impact on the economy right now aimed squarely at the middle class. so the question really for folks in congress is, do they want

. >> next a speech from the clegg on the british economy. the liberal democratic leader made these remarks anduring a conference. this is about 40 minutes. >> thank you. >> thank you. >> friends, we have now been in government for 500 days. it is not easy. none of us thought it would be a walk in the park. i suspect none of us predicted just how tough it would turn out to be. we have lost the polls. we lost seat. we lost the referendum. i know how painful it has been to face anger and frustration. some of the may have even wondered if it will all be worth it in the end. it will be. today i want to explain why. above all, i want to pay tribute to you. your resiliency. your grace under fire. i have been genuinely moved by your spirit and our strength. thank you. thank you for never forgetting this. one of our defeated members said that of losing was part payment for ending child protection, he says i except it in my heart. that is the liberal spirit. that is something we will never lose. it is the spirits it is the same spirit -- is the same sp

given the relatively slack performance of the economy. where i think consolidation will cause difficulties is in the small towns of america where there may be only one or two institutions, neither of whom may survive. it the put further pressure on as the economy tries to recover. >> susie: and we hear from so many banks, small and medium size businesses, that it's very tough to get loans from their banks. why do we keep hearing this? >> those comments are sporadic and geographic. if you run a business in a town where two or three of the banks are in trouble and operating under agreements by regulators that frankly don't allow them to make loans you could be suffering the consequence of that. to be frank, the large banks and most of the regional bank that is have healthy balance sheets are desperately trying to make loans in this environment, because whether we like it or not, banks can't make mon fethey can't make loans and certainly we're not going to make money investing in government securities yielding one or two or three percent. so

a lot of good but the economy was a good drag you had a couple of years but economy was contracting a bit but on the whole the economy was expanding quite fast i thought you had only had thatcherism under tony blair we are you know we can't be carried out of if we still have it we like it a father got a wife but my point is you can have factories and you can have that kind of structural form in the economy was shrinking at six six percent seven percent a year i just i just think it's impossible it's too but it's too much to ask of a population you can have in a popular you could have an economy that's growing two to three percent a year is still a big ask it's tough for people people lose their jobs people have to change the kind of work they're doing industries have to change it's very very difficult it's easy to sit around a t.v. studio and say you have structural form is actually hard on the ground but to have that kind of intense contraction just because it's not going to let these point is a good one though again about diversion development but the problem is that unlike england

>> those levels of debt are a burden on the economy. they reduce our output and our incomes relative to what we would enjoy a if we had done less borrowing and more savings. >> this committee has been tasked under the budget control act of finding 1.5 trillion dollars in deficit reduction over a tenure. what is the size of the economy over the next 10 years? >> the gdp today is about 15 trillion dollars. we think it was over the next 10 years down. yet in the calculation, i would be happy to hear from you. >> justice and never tenures, 150 trillion. are talking about 1% of our economy, are we not? in terms of rough numbers. the reason i want to point out this number is you mentioned the impact of making decisions about spending that might have impacts on the economy. i just to put into perspective over the next 10 years that these reductions that we are asked to find a the next 10 years roughly represent 1% of the economy. i'm talking very rough numbers. >> i think that sounds about right to me, congressman. i agree, the problem is or lo

but the outlook for the global economy has got worse. so we need to do more, we can do more, and we will do more for growth and for jobs. because we're not in politics just to repair the damage done by labour, to glue back together the pieces of the old economy. we are here to build a new economy. a new economy safe from casino speculation. that's why a liberal democrat business secretary is putting a firewall into the banking system. protecting the people who have worked hard and saved. a new economy that safeguards the environment. that's why a liberal democrat environment secretary is creating the world's first green investment bank, spending three billion pounds to create green jobs. a new economy where the lowest- paid get to keep the money they earn. that's why a liberal democrat chief secretary to the treasury has put two hundred pounds into the pocket of every basic rate taxpayer and taken almost a million workers - most of them women - out of income tax altogether. a new economy based on skills. that's why one liberal democrat mi

in fact men have not adapted well to the industrial economy. college graduation among men have not risen substantially since 1980. men have not successfully transitioned into the services. growing fields like education and health care remain just as lopsided in employment towards women as they were at the beginning of the decade. what men have done is exited the work force. they have been doing it for years and more quickly since the recession. in 1967 among men with high school degree in prime working years 19% were working. today 76% are working. what does that mean? it has -- for consequences are more than one might initially suppose. family life is changing significantly in many parts of the country that are characterized by a blue collar work and communities where people overwhelmingly do not have college education. women don't mary men who don't have jobs or who are economically insecure but they do have children with them and those children can struggle when as usually happens their parents don't stay together. what are we seeing as far a

the fact ithis. we have a different economy. this is the third economic revolution and what andy grove from intel said was this idea that we're fighting a fixed plan... fixed mmunist economy, this is a battle between the free market and planned economy we now have a new for. it's called brazil, singapore, china, where we have nations that see themselves as teams and teams that have economic plans. our market fundamentalism is exactly the wrong medicine right now and that's what we saw in the debate in the republican party and that is going to kill the american economy in the long run. >> rose: you watched it last night? >> yeah. i pretty much agree mark and john. we know it's two-man race. obviously romney and perry there. romney is going to make the case he's aurnaround artist. the first sort of candidate c.e.o. and i think perry really is going to really double down. we've seen dhipl that in social security not clear whether or not he's left himself room to come iand say well, maybe it is a ponzi scheme but here's how we can re

and send the economic surplus into the banking system in order for the economy to survive that's the myth michael how do you think it's with so you can see me we expect to see the debt ceiling. again but the debt ceiling you mean relieved there is no way in which the ceiling cannot be raised because of the degree of military spending the off balance sheet the question isn't about the debt ceiling the question really is what changes are going to how is the government going to cut back spending on labor and on social security and on social programs in order to increase the military budget very substantially in order to give more bailout funds to the banks so so you sound pretty optimistic if i was a banker i would be very optimistic if i were an economist and this means that the economy will be moving into a depression for about five ten years to finish the question that's what it was to be next as you want and it isn't a painter nor a banker nor any economist at so you do your what makes you happy. understanding what's happening and my identity is basically a bit

, very destructive to the economy. look back and say we shouldn't have done that, the smoot holley tariffs and shutting down international trade was bad for the economy. free trade is where economists of all stripes. with comparative advantage, gains from trade, both nations are better off and i think shutting down trade or trying to severely restrict trade wouldn't work any better than now than it did in the '30's. >> doris, welcome to the program. caller: for "washington journal," i have -- i have a comment but first i want to say you have the heritage foundation on. some weeks you have the heritage foundation and the cato institute. are these your new best friends going here? and heritage guy said that one third of businesses said it was healthcare? i read that same thing. two-thirds said lack of demand. the rich do not invest in america. they invest in "emerging markets." those are in china and india. and then they want to say they're not committing class warfare, they refuse to take away subsidies for corporate je

the workers. right now i don't think anyone's winning in obama's economy. going to that nine percent will see obama's going to talk tomorrow he's going to give he's going to continue on the same old policy that in trying to introduce a plane that won't pass i think i think this is where i think we're all in bad shape because i'm ok why would say the middle class is in bad shape the billionaires are getting richer under bush they get again richer under obama they're doing just fine i. just i don't see that resolving any i'm. saying of james thing thank you both for being struck stuff that was coming out from secret must.