tv Bulls and Bears FOX Business August 18, 2013 1:00am-1:31am EDT
government grossi in freedom yields. that is ever show. begin for watching. we will see you next three. thatmercy". >> we'll hear more from these guys in the after the show show. thank you. >> see you tomorrow. consumer sentiment falling and even while retail sales for the month of july held up. some companies are sounding th alarm. walmart, macy's, joseph a. bank, nordstroms worrying about their shoppers. is that payroll tax hike hurting consumers? hi, everyone, i'm brenda buttner. this is ulls & bears". let's get to it. we have gary smith, tracy burns, jonah, john layfield along with steve murphy. thank you. so, john, should d.c. be heeding
these retailers' warnings? >> of course they should be. there's plenty of time since they're all on vacation right now to look at the news. the presidents that have done best lowering taxes have spurred the onomy. look at president coolidge, rornld reagan spurred the economy, when he lowered them, he later raised them, but to get the economy going, he lowered taxes. walmart said they're hurt by lower income sales. a 2% payroll tax increase, the payroll tax cut was put in place. it hurts lower income. if you're in the upper middle class, if you're higher, it doesn't affect you at all. with high gas prices, lowest labor partipation rate since the 1980s and the economy stagnant, it hurts consumers significantly, yes. >> it's not just lower economy because we saw macy's, nordstroms, they have to fire their piano player or something, th is really hitting everyone. >> it's simple, right?
you tax me more, there's less money in my paycheck. that's the bottom line. that means they're less disposable income for me to go to nordstrom's and buy a pair of shoes. instead what i have has to go to pay my bills. taxes hurt, bottom line. they'll continue raising them, which means this economy is not going to get better. >> steve, you buy that? >> nope, it's completely i will logical. our greatest economic pros sparety in history occurred in the '90s when we had exactly the same -- >> we had a tax bubble. >> -- as we have right now. no, throw out the '90s. the tech bubble didn't boost the economy. we had strong economic growth with exactly the tax structures we havtoday. the problem is people don't have money because there's no wage increases. that's the macro economic problem is. you have over population liing from paycheck to paycheck. of course, the idiocy coming out of washington by default and about downgrade and about
government shutdown, that doesn't help the economy any either. >> well, gary, bottom line, taxes, do they help or hurt the economy? >> well, they always hurt the economy. up, going back to the point that steve made, let's stipulate that he's right. the big difference then in the '90s the government spent a lot less as a percent of gdp. when you raise taxes you're taking it from an efficient source, the market, the consumer, and giving it, by definition, an inefficient source of spending, the government. go through their zillion programs they run, cost overruns, the government spends less efficiently than we do. here's the statistic everyone should know. since the recession arted, median household income is down almost 10%. and even with all the stimulus it hasn't budged at all. unemployment has come down but median household income has flat
lined at an historic low level. that's the reason can you take -- you can look at the increase in taxes, obama care, red tape, all that. government needs to get out of the way and let people keep more of their money. >> all those companies all got sales boosts when we had a temporary sales tax cut recently. you can't, they're having less sales. no one likes taxes. at the end of the day this specific tax goes from your paycheck to florida to people who are retired so they can go to nordstrom's and walmart. if we would keep it inefficiently low, we would have to raise government taxes. >> when they cut the payroll tax, joe, that money went to gas instead because gas prices were so much higher. it was -- it didn't go to --
>> it was a boost to the economy. how do you -- >> it didn't go to nordstrom's. >> the payroll tax going in and checks going out to social security -- >> d.c.'s not going to take on social security. that's not going to happen. >> jon? >> what steve said is exactly right. the taxes in a healthy economy are not going to affect this but we had a housing boom that did help with this. this is not a healthy economy. we have 47 million americans in poverty and growing, record numbers right now. when you have an economy that is not healthy, the thing to do, and history has proved this, not to raise taxes. we cannot expect the government to be more efficient. we would be better off if they never came back from vacation but they should not raise taxes. >> consumer sentiment was at a six-year high in july.
what does that tell you? >> it tells me a couple things. number one, it's highly volatile. the consumers don't have -- number two, the consumers don't have enough money to sustain that sort of viewpoint. they simply -- excuse me, with income levels flat over essentially two generations now, only women going in the workforce has allowed the middle class to keep pace with where they were 40 years ago. eventually, it's going to run out of steam because there just isn't enough consumer buying power. >> again, it comes back to tracy's point that if you take taxes -- if you hike taxes, you take money out of people's wallet. tracy? >> yeah. so that's why the median income hasn't gone up because my taxes have. >> no. >> no? how could that not be participate of equation here -- >> your taxes haven't gone up compared to historical levels. >> have you done a tax return recently? i used to do them for a living.
taxes have gone up a lot 37 everyone shod take note of this. you have taxes on everything under the sun. you are taxed to drive your car to and from work every day, your gas tax has gone up, there's less money in your paycheck today than there was ten years ago. >> and, gary, we've seen energy costs go up, education go up, even food prices are going up. that's another tax in some way. >> exactly. i think that's what tracy's getting to. it's not just the line items you put on your 1040, which are numerous these days, but you're right, it absolutely is. it's the cost of commuting, the gas tax, the food prices we pay. everything has gone up. the bottom line, the average household out there has less to spend. that's a fact. because they have less to spend, retailers like walmart, dollar general, et cetera, et cetera, are suffering, and they're going to continue suffering as long as that income stays low and the
bigger point probably, that high unemployment rate stays as high as it is. >> in fact, walmart is warning basically that things are not going to get any better. what does that say when the world's largest retailer when they say, sales are going down? >> that could construe the upper end of the economy is doing better. that's not their target audience. i will say -- you guys are talking about half the equation. the you said gas prices, that's going up this year and interest rates are going up a lot recently. that's what consumers and investors are more concerned about than payroll tax increase. you spend less, means less drive, less gas demand and the government is borrowing less beuse they don't have to offset that artificial tax cut. we've seen interest rates go up less. >> that's got to be the last word. thanks, guys. coming up, neil predicted it. harry just confirming it. time to brace yourself for
you say if big labor gets its way, all wrkers will pay no matter what state they're in. >> brenda, exactly. look, this is a simple equation. you need to understand, everyone should understand, what monopolies -- what unions are. unions are basically monopolies. they exist to charge higher wages than the market will bear and provide fewer jobs. i don't blame the union. that's their role. by attacking these governors. they're attacking competition in the form of workers. the less workers in every one of those states, the more the unions can control and extract higher wages and more secure jobs for their employees. that's why everyone in the country should fear unions growing instead of, thankfully, shrinking like they have, because you'll get the same thing times a thousand, that we will in auto industries, airlines, everything, where eventually eventually crumbled those businesses. >> shouldn't the union be
praising and be embracing of what they're doing in these states instead of targeting them? >> well, no, absolutely not. for two different reasons. one, the reason gary just described, its their workers being laid off. most of the afl-cio membership is come he posed of public union members, public employees, period, and that's who's being laid off. the big economic question we have here is are we going to invest in education. all the governors have cut teachers. all of them have cut funding for education. what's the long-term eonomic impact of us having aless educated workforce? it's devastating for users have other countries. >> john, theg in these states. it's more pro-business, doing better under these governors. >> yeah, you look at states like wyoming, spending on education. you look at chicago, a union-based city that cut 2700 teacher. that's not an apples to apples
comparison. what gary said is right, this is about competition. unions have gone from high 30% of public employees down to 7%. days of frick and carnegie steel mills are over. if you're a member of a union, understand, your dues are going to sway some political race somewhere in the country. >> tracy, why should people, taxpayers in other states, be worried about this, that unions are targeting these governors? >> because they're looking for membership. that's what they want here. that curveball on education came out of nowhere. the unions should care less about education. think about it. they want their membership higher. that's the bottom line. they are targeting right to work states because they don't favor unions. they're targeting auto industry in rht to wrk states because they want unions to go german auto union style. you get unions involved.
the price of the stuff they're putting together is getting higher. th means you and i will pay for it at the end of the day. >> i think these governors are doing a good job making had their states business friendly and encouraging businesses to move to their state. they're not making the states employee-friendly. that's half of the equation. companies will move there because taxes are low but high-quality workers want to move to unfriendly states like california because the lifestyle is better and schools in the top ten. >> california? >> yeah. that's why all the businesses in california move to texas. >> they have sunshine. >> the schools are not good there. taxes are high. >> workers won't follow them. >> that's why they're moving, jonas. i'm telling you -- you can have no unions and have what i'm talking about. a state has to give them a reason to live there. you'll never get high quality workforce in low tax states because -- >> john is jumping in here.
>> i made -- i'm in california right now. i'm from texas. understand the migration. theye mad at governor perry. the ads, we have low taxes to no taxes. that's where they're moving. jonas, the demographics are completely against your argument. workers are and companies are leaving california in droves. especially to texas. >> certain kinds of companies that can do that but certain ones need high quality workers to support the tax base. >> jonas sounds like a union organizer to me when he says high quality workforces. we have high quality workforces. they're in the state and local government and teacher unions and they're grossly overpaid. a high quality workforce is someone that has a job. that's the point we're at right now. >> jonas, just -- we have to go. jonas just wants to be a southern california dude again.
tracy, is this necessary or no? >> it's ridiculous. they don't need any more of our money. if my school needs high-speed internet, they'll ask me and i'll give what i can. we all know, when you give tax to government, we don't know where this money goes. i don't to want give another dime. >> my cell phone bill, there are so many taxes on it. jos, is this a crazy idea? >> no. i'm disturbed these schools don't have high-speed internet. i can't believe they can't afford that. and then they have sports program i'm paying for, my property taxes. the school has to generate the next steve jobs, not the next athlete hero. they need an hero, not another sports athlete. they need money to do it. i think we've taxed wealthy enough. how about something progressive. tax the phone, everyone will pay for it. >> let's go to the real athlete here. john, what do you think? >> look, jonas is wrong about qualified workers in texas but he's right about the need for
high-speed internet in schools. i work at at-risk kids. i understand how important it is in schools but taxing cell phones? how indicative of this administration is this, free pizza for everybody. we'll tax cell phone. why don't you tax swimming pools? this is ridiculous. >> they do. they tax swimming pools with property tax. >> property tax goes up and -- >> there you go with california again, swimming pool. stooefshgs even you don't think this tax makes sense. >> i think the federal government should lead the investment in school to make sure every one has high-speed internet. i'm against using a regresses ive tax to do it. we've had a big regresses ive tax increase with payroll tax being restored to its previous level. >> don't taxes require congressional approval? >> apparently not under this administration where, you know, the emperor rules everything. you know, we get taxed whether we like it or not. that's number one point, brenda. maybe the most important.
the other thing is, i do not agrewith steve. the federal government, as tracy implied, should be out of the education business. they haven't had a successful education program in the last 100 years. their banner program head start has proven to be totally ineffective. we practical double what we spend per pupil, education scores haven't risen. this is another goofy idea by the federal government that won't work, will cost us and is not anywhere that i can find in the constitution. >> last word, tracy. >> i mean, i don't know. maybe they should start charging teenagers a tax because then you could fund just about everything in the worldwide. >> charge them per text. >> that's a good idea. >> thanks, guys. thank you, steve, for joining us. we appreciate it. >> my pleasure. up next -- >> let me buy you these drinks. i feel bad about today. >> thanks. >> well, those days may be over. more than 6 0% of men saying
>> kids are expensive. john, your prediction? >> geek and chic. marissa mayer in "vogue" magazine. good for him. yahoo! up 20%. >> bull or bear? >> i don't like yahoo! >> your prediction, gary? >> i like walmart. we talked about it. lousy outlook. i still think it's a great stock. 25% rise from here in a year. >> jonas, what do you think? >> it's more of a target economy again. >> very good. your prediction, jonas? >> two-thirds of men don't think they have to pay for a dinner when they go on a date. this is why birth rate is too low in america. let me say, you can solve this problem, pay for dinner,and be a cheap skate because you can get two for one -- >> no wonder you're not married.
>> any dead beat man who doesn't open a door for a woman and make her pay -- so much alimony to my husband, i'm never having dinner again. "cavuto on business" up next. >> did harry reid let his party's real health care plan out of the bag? good morning. it looks like democrats go along with with the bad private health care in america. that's not me saying it, although i have often said it. more on me later, my favorite subject. now back to the senate majority leader and what he was saying when asked about whether he was actually working to scrap our present health care basis. >> we are far from having something that will work. >> eventually, you think we'll work beyond -- >> yes. >>