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tv   The Rachel Maddow Show  MSNBC  May 19, 2012 3:00am-4:00am PDT

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and main street found its fight again. and we, the locals, found delight again. that's the power of all of us. that's the power of all of us. that's the membership effect of american express. so in this election everything old is new again. for example, the plane that candidate mitt romney flew from jacksonville to palm beach in florida yesterday, that was exactly the same plane john mccain used during his presidency four years ago. uh same flight attendant, even. that wasn't the only 2008 flash black this week. >> i do believe the economy, jobs, national security are by far the most pressing issue facing the country today. i also feel that every candidate needs to be fully vetted. that's something the mainstream media failed to do back in 2008 with barack obama. >> that is the conservative narrative about what went wrong
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the last election. that barack obama was never properly vetted. that the meet ya never fully checked him out. the mccain campaign didn't prove that he was radical in his politics. if the american people only known the truth back in '08. they would have never made the terrible decision to elect him as president, which is perhaps why so much of this week's news felt oh so very familiar. >> i don't know whether barack obama was born in the united states or not. i don't know. but i do know this, that in his heart he's not an american. he's just not an american. >> i believe that the president was born in hawaii. or at least i hope he was. but my responsibility as secretary of state is to make sure that the ballots in arizona are correct and that those people whose names are on the ballot have met the qualifications for the office
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that they're seeking. >> there's been big breaking news, ladies and gentlemen. it is on bright bart, barack obama, the first african-american president of the harvard law review was born in kenya and raised in indonesia and hawaii. that's actually what the research shows. and what is this from? it is from a book promotion put out by his literary agent, that barack obama approved of. >> in spite of a confession from the book agent that the error was hers alone, and the birth certificate the obama administration released last year, birtherism is alive and well. also bubbling up from last election cycle, obama's long severed relationship with pastor jeremiah wright. an ad featuring that relationship to a super pack billionaire who saw an on-air ad from '08 featuring jeremiah
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wright saying when he saw it, quote, if the nation had seen that ad, they never would have elected barack obama. the reemergence of reverend wright has spawned the reemergence conspiracy, that obama is a secret muslim. >> when i asked the reverend wright about this whole question of islam and christianity, he said barack obama was steeped in islam. he knew a lot about islam from his childhood. he knew very little about christianity. i made it easy for him to feel not guilty about learning about christianity without turning his back on his islamic friends. >> what does that mean? >> then i said to him, did you convert him from -- >> you did ask him that. i remember. >> i said did you convert him? he said, it's hard to tell. >> so barack obama once again a secret muslim born in kenya heavily influenced by an
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anti-american pastor. it's all new again. to be clear, this is not what mitt romney wants his campaign to be about. he's way too smart for this. he does not want to hit redo on the whackiest parts of 2008. as new york magazine points out, mitt romney's campaign is firmly focused on making this election be about what is happening now, making this about the economy. the last thing romney wants to be doing which he had to do yesterday is talk about things that distract from that message. things like reverend wright. that's like 2008 too. this was the exact same tension that john mccain had to deal with in '08, distancing himself from the attack lines with the same conservatives that wanted to be resurrect, like pastor wright. >> he's been going to the church for 20 years. his pastor, the church gave a lifetime achievement award to one of biggest racist, would you
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go to a church where your pastor louis fericon? >> obviously, that would not be my choice. i do know senator obama. he does not share those views. >> senator mccain paused for the long sigh. they also had to reject the birther argument. john mccain had to defend his opponent in the he's a secret muslim line of attack. >> i can't trust obama. i've read about him and he's not -- he's a -- he's an arab. he is not -- >> no, ma'am. >> no? >> no, ma'am. he's a decent, family man citizen that i just happen to have disagreements with him. that's what this is all about. he's not. >> mitt romney finds himself not only in the same plane but in the same boat as his predecessor.
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joining us now is the host of melissa harris perry. melissa harris perry. >> funny how that works. >> why is this coming back? what do folks feel the actual upside is going to be? they didn't have much to attack him on, so they had to find things. here he has a record and he's been president for a little while now. >> i think that's part of what, if i wanted to tell the most reasonable story, a story that didn't include my own version of this sort of narrative of people being out to get you then my story would just say, look, the fact is that the economy is getting better in ways that point toward re-election. he's moving down toward that 8% unemployment which he himself set out, and the romney campaign set out. he's had significant foreign policy successes. when looking at the domestic and foreign policy successes of this president, they figure better to kind of go on the attack of him being scary and foreign.
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but that is really me being the most charitable that i can possibly be. in fact, i suspect it is a little worse than that. there's an assumption that the american people are still easily swayed by the most sort of base and crass, emotional sort of racial attacks and attack that is are fundamentally about making the president seem as though he's, as we have heard literally there, not an american. >> i wonder if it's really so thought out. i think one of the challenges mitt romney has in the election or the republicans have in the election is there's this conservative ecochamber and the vision that you have of barack obama has become so divorced from reality is a guy who needs a teleprompter to speak. he is truly un-american. and that vision has sort of led them in all directions strategy-wise. these attacks make sense in that
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world, but when you go to middle america and people who are not in that kind of thing, it turns them off. >> i do think some of this has to do -- i agree. i also think, as i watch john mccain in that moment or remember his speech in 2008, despite the fact that's a candidate who i never supported and with whom i disagree on fundamental issues, i can look at that and smile. i can say that's a good moment for that candidate. that's a person behaving as a state's person. i do have to ask, what is it about president obama that makes it so difficult for his opponents to see any sort of humanity or any sort of american shared identity because it's part of what president obama did so beautifully in 2008 as a candidate, was to take his own biography and make it a star i biography among many americans. >> now americans have a shared biography with him, that's part of the story. so i guess that is, in the end,
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what i can't figure out. i do think a lot is sincere, but why the cynical part of the rains hasn't taken over yet. if the secretary of state make this is an issue, it is going to be a huge issue that will derail romney for weeks. it seems out of party loyalty, he would quiet down. >> trying to think ant it, maybe the idea is to get us confronting this instead of something else. obviously tomorrow we are going to talk about the jeremiah wright moment, about this sort of recalling, but we'll also point out that maybe the leak is the story. it was never going to be a strategy, but it was going to be a leak to get these days of coverage to get us the ones to be talking about it. perhaps there's something else we're not talking about as a result. >> melissa harris-perry, i'll see you tomorrow morning. >> glad to have you. >> you can catch the show saturdays and sundays from 10:00 to noon eastern. thank you so much for being here. still ahead, nobel prize
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winner paul clemente will be here. plus a real live republican senator. stick around. [ donovan ] i hit a wall. and i thought "i can't do this, it's just too hard." then there was a moment. when i decided to find a way to keep going. go for olympic gold and go to college too. [ male announcer ] every day we help students earn their bachelor's or master's degree for tomorrow's careers. this is your moment. let nothing stand in your way. devry university, proud to support the education of our u.s. olympic team.
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mitt romney, let me introduce you to how things in the economy really are. things in the economy, let me introduce you to mitt romney. that's coming up next. wake up! that's good morning, veggie style. hmmm. for half the calories plus veggie nutrition. could've had a v8. this one's for all us lawnsmiths. grass gurus. doers. here's to more saturdays in the sun,
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the story state of the u.s. economy. >> america counted on president obama to rescue the economy, tame the deficit and help create jobs. half the kids that are graduating from college can't find a job that uses their skills. half. the length of time it takes an unemployed worker to find a job is the longest on record. we can prosper again with a powerful recovery we've all been waiting for. the good jobs that so many still need. >> president obama has failed on jobs. that was the message from mitt romney in iowa. it was a message that was just slightly undercut when news organizations began pointing out that the iowa economy is not so bad right now. iowa has one of the lowest unemployment rates in the country. the unemployment rate has dropped to 5.1% from a month ago. earlier this month mitt romney took his campaign to virginia. he railed against president
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obama for how horrible the economy is right now. >> he said he measures progress by whether we're creating jobs to allow people to pay mortgages. he hasn't been creating jobs. they have not been doing what they do to create jobs in virginia. >> president to into ma has failed to create jobs in virginia. that's a good sounding message. it's a good campaign but it's massively undercut by the fact that the unemployment rate has fallen from 7.3% at the beginning of 2010 to 5.6% now. virginia governor bob mcdonald who was standing next to mitt romney when he just said that has released $400,000 worth of job ads talking about how good the economy is. the basis of his message is that the economy is worse than when president obama took office, or at least made worse by obama's policies and we should hire romney to fix it. in all of these states that he's
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traveling to, not only is the economy getting better but there's republicans in the states that want to take credit for it. that played out perfectly for romney during a trip to ohio a month ago. mitt romney and ohio's governor jonathan kasich met with a group of college kids there. mr. romney pushing the awful message tried to prod the college kids into talking about how awful it is. >> i've seen some numbers that were just published about the number of young people that are graduating from college that are getting jobs and that are getting job that is are consistent with their skill level. and it says only about half of america's graduating seniors are able to find ork work or find work that's up to their skill. are you seeing a better record than that or are you seeing a lot of folks finding it difficult to find a good spot? >> right. probably a lot of folks having a difficult spot. that's the message, there are no
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available jobs. and then ohio governor john kasich stepped in and stepped all over mitt romney's message. >> we have a website called ohio needs jobs. there's probably about 80,000 jobs listed on there where there are openings. >> really? >> yes. >> you need to tell your friends, it's ohioneedsjobs. if you look through that you'll find a lot of real exciting opportunities. >> you can almost see the pain on mitt romney's face as john kasich is talking about how many jobs are available in the state. it is a total contradictory message from the one romney was trying to push right there. governor kasich was asked about the glaring contradiction after the event. >> it's almost like there were conflicting messages. romney's message was we got to bring jobs here. we're really hurting. the obama administration has failed everywhere, including
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ohio. then you're saying, hey, kids, we got all these jobs going on. we're creating jobs like crazy. >> i've told -- first of all, we are creating a lot of jobs. >> he's right. ohio is creating jobs. the unemployment rate slowly ticking down as it is all over the country. 48 states have seen a drop in unemployment rates over the past 12 months. this can be an inconvenient truth, particularly if you are mitt romney. not only is the economy getting better, but the republicans in these states are proclaiming the economy better. it is republican governor john kasich of ohio, republican governor rick snyder of michigan, republican governor scott walker of wisconsin. but it may be even worse than he thinks. earlier today the conservative texas public policy foundation attempted to brag about how great the economy is under governor rick perry.
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josh sarbino tweeted, quote, texas has been adding jobs now for 21 consecutive months, 21. that is impressive. benjy says it's been 26 months nationally. part of this goes to show that politicians are always lying and exaggerating and spinning when taking sole credit for jobs and blaming others for job loss. the economy is driven by much more than decisions by politicians. europe as you'll hear about will have a lot to do with our job creation this year. mitt romney can hardly say that. he could say that while the economy is getting better, it's getting better slowly than any of us would like, but job growth could have been faster does not have the ring that obama hasn't been creating jobs. as my colleague greg sergeant pointed out, mitt romney has been very poignant about what he
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would have done. mitt romney has a bit of a message problem. maybe he should look at the obama birth certificate. that starts in your mouth. it tickles up your spine and punches you in the face. a good kind of punch. one that lights the fuse that starts the day you didn't see coming. ♪ you follow that feeling and every chew takes you somewhere new. so yeah, maybe it's more than just a little piece of gum. trident. see what unfolds. and then treats day after day... who gets heartburn so yeah, maybe it's more than just a little piece of gum. well, shoot, that's like checking on your burgers after they're burnt! [ male announcer ] treat your frequent heartburn by blocking the acid with prilosec otc. and don't get heartburn in the first place! [ male announcer ] one pill a day. 24 hours. zero heartburn.
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once upon a time, stephen held the record for the farthest flight by a paper aircraft. he gave his plane a name.
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so row lock that apparently translates to leaping flame, which i did not know. he spent the entire summer working on his throwing arm and in september '03, he set a record of 207 feet and four inches. that record held for nine years until this february. >> there it is. there it is. we are all over that one. that's going to do it. get up there, get up there. that thrower is 27 yield joe ayube. a former quarterback where very serious players play ball. he threw that plane 226 feet and 10 inches. i'll do the math for you. he won by 19 feet, 6 inches. huge. straightforward. you hold a record and a better guy comes along and takes it from you. the guy on the right in the blue shirt folded that paper airplane.
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collins is noun as the paper airplane guy. he's designed lots of different kinds of aircraft. he published his own book and has his own app out. he says he didn't have a good enough arm to go the dance. he outsourced it. the quarterback and the paper engineer share the record. stephen is a little miffed. the now 23-year-old mechanical engineer is not saying it's invalid but bringing in a proxy into the paper airplane throwing doesn't sit right with him. competitive paper airplane flying had always been in my mind. what can one person do with one piece of paper? using a ringer is problematic. i don't think that's the spirit of the competition. john collins didn't break any rules. in fact, someone called the decision to outsource the paper airplane is a smart way to win the record. what this comes down to is not
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what is fair, but what feels fair. not all playing fields are level. sometimes you think you're throwing a cleverly 8 1/2 by 11 piece of paper under the same circumstances as everybody else and suddenly you find you're not. there's other bigger news that brings up questions of fairness and whether we're playing the same game. that's coming up later in the show. time for the "your business" entrepreneur of the week. mariah finley is founder of citrus lane. customers sign up and once a month get a surprise package of baby products. instead of hiring someone she
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did her own marketing group and customers to fine-tune her business. for much, watch "your business" on msnbc. cerl? yummy. [ woman ] lower cholesterol. [ man 2 ] yummy. i got that wrong didn't i? [ male announcer ] want great taste and whole grain oats that can help lower cholesterol? honey nut cheerios. that can help lower cholesterol? last season was the gulf's best tourism season in years. in florida we had more suntans... in alabama we had more beautiful blooms... in mississippi we had more good times... in louisiana we had more fun on the water. last season we broke all kinds of records on the gulf. this year we are out to do even better... and now is a great time to start. our beatches are even more relaxing... the fishing's great. so pick your favorite spot on the gulf... and come on down. brought to you by bp and all of us who call the gulf home.
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this is how we tame the unwieldiness of air travel, until it's not just lines you see... it's the world. don't look now but there's something funny going on over there at the bank, george. i've never seen one but that's got all the earmarks of being a run. >> that's a clip from the christmastime classic, "it's a wonderful life." it's also a time capsule to look back at the great depression. frank capper released it in 1946, shooting it right after the great depression. he remembered what it looked like. that clip is what a lot of it looked like to ordinary american. that is a bank run. and the great depression had a lot of those. a bank run is a self-fulfilling collapse of confidence.
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people for whatever reason, maybe a rumor, maybe an actual global financial crisis, become worried that the bank won't have enough money to pay them back. it won't give them their money. so they run to take it out of the bank. but banks aren't like a giant safe where everyone's money sits. a lot of the money a at any given time is loaned out. here is jimmy stewart explaining why his bank couldn't give everyone their money back. >> i'll take mine now. >> no. but you're -- you're thinking of this place all wrong, as if i had the money back in a safe. the money's not here. your money is in joe's house. that's right next to yours, and in the kennedy house and mrs. makeland's house and a hundred others. >> whether the bank run was justified in the first place, the fact of a bank run makes the fears valid. even if everything had been just fine, now the bank can't pay everyone back because they never expected everyone to demand their money back all at once, so the bank collapses.
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that would be bad enough. banks are contagious. people hear about the bank collapsing and they are worried that will happen to them. they run to get their money out of the bank taking down another and another. the united states used to have a lot of bank runs but after the depression, we ended them once and for all. the fdic ensures all bank deposits today. if your bank collapses, the government gives you your money back. so we don't have bank runs on anymore. what's going on in europe is a bank run with a twist, it's a country run. the run began with greece. they lied about their budget situation. turned out they were deep, deep, deep into debt. at the beginning this didn't scare investors too much. they thought the eurozone had an fdic. they thought rich countries like germany they would always get their money back, but they were wrong. the run is in the financial market where investors don't
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want to loan them money and in their banks where ordinary greeks took out 700 million euros on monday alone. but greece is tiny, so who cares if it defaults. think back to the terrifying logic of bank runs. if one indebted country goes down, will the next? and that's the worry. the if greece can fall to a run, what about portugal or ireland or spain or italy? suddenly it's become easy to see how the euro, that grand flawed experiment in monetary political union, could come apart at the seams. we are not talking about this in prospect, either. things could fall apart within a matter of months, not years. economics and more important political could be huge. joining us now is winning economistnd the author of "end this depression now."
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it's a new book that i've read, which is fantastic. thank you for being here, paul. >> okay, hi. >> first, because you're smarter than me and you know this issue better than me. are there any corrections? did i mislead the audience about what's going on in europe? >> the one thing i would say is this is not jimmy stewart's bank. the trouble is that there are real problems. it is not just a crisis of confidence, even though that's happening, too, but it is that greece is fundamentally incapable of paying. unless there's a change in european policy, so is spain and italy. it's a panic on top of an underlying problem of bad policies, not so much on the part of the southern europeans, greeks have accepted on the part of europe as a whole, so this isn't just a matter of calming things down, they have to change things in a much more fundamental way. >> what happens to us if the euro falls apart? we see country runs and they are not able to stop it? >> so the first question is,
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where does it stop? if it's just greece, then that's bad, but it can be contained. if it spreads, the worry is this will take out spain, italy and portugal, which will happen if the european central bank doesn't provide trillions of euros of cash. and if they don't, at the same time say, okay, enough of this austerity business, we're going to provide some growth so you can grow your way out of this. if that doesn't happen, the whole euro breaks up. then two things happen. it's going to be bad for the european economy, at least initially. it's going to be a hit to the economy, which is going to hit u.s. exports, which is serious because we do export a lot but not that much. we only sell about 2% of what we make to europe. so that's manageable. the question is, does this then spread to where it disrupts financial markets here, too? does this turn into a super version of the fall of lehman brothers? i guess, i think that's not going to up what. i think the european central
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bank can contain that bit. i think the federal reserve can probably contain it here. i wish i was 100% certain of that. i'm talking long here, but last thing to say is, the political consequences. i mean, europe, the european project, europe as a place of prosperity, peace and democracy, that's a crucial part of this world we are living in. if that falls apart, boy, it's going to be an uncomfortable place for the next generation. >> one thing that's been confusing to people, you've been talking about how in order to get past this crisis, germany and the european central bank need to become more comfortable with inflation. i think folks think of it as bad. how would inflation help? what would that do? >> the most important thing right now is that there was a huge bubble, not so different from the bubbles here, but there was a huge bubble in housing and other things in southern europe, which led to their costs and their prices getting out of
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line. so right now you have spain that's probably 30% too expensive relative to germany. that needs to come down. but if it comes down through deflation in spain, that's devastating. that means years of very high unemployment. it also mean that is the burden of their debt becomes ever worse. if instead a significant part of it takes place through deflation in spain or inflation in germany, the germans wonts like it, but that's probably much more of a feasible solution. so a higher overall rate of inflation in europe turns, it's still going to be painful for spain, it will still be painful for italy, but it turns it from being pain that will kill their economies to pain that might be tolerable. plus, overall, a lot of debt was taken on, a little bit of inflation reduces the burden of debt everywhere. this has been the way we have gotten out of a lot of debt problems in the past. so inflation helps there, too. that's the reason we could use a bit more inflation, too, but the europeans crucially, they cannot make this adjustment.
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if the european central bank says that overall european inflation is going to be below 20%, 2% for the next five years, that's the end of europe. that's the end of the lower inflation rate. >> paul krugman. thank you for much for your time. >> thank you. still ahead, i will talk to real live republican senator about stuff we might actually agree about. ♪ why do you whisper, green grass? ♪ [ all ] shh! ♪ why tell the trees what ain't so? ♪ [ male announcer ] dow solutions use vibration reduction technology to help reduce track noise so trains move quieter through urban areas all over the world. together, the elements of science and the human element can solve anything. [ all ] shh! [ male announcer ] solutionism. the new optimism. so i wasn't playing much of a role in my own life, but with advair, i'm breathing better
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by the name of mr. davies. he made physics more than theoretical, he made it real for me. we built a guitar, we did things with electronics and mother boards. that's where the interest in engineering came from. so now, as an engineer, i have a career that speaks to that passion. thank you, mr. davies. if you updated your status today to say i just made a gillion dollars on facebook's ipo, then you and facebook aren't just friends, you're best friends. what that means for the rest of us is coming up next.
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there's a kind of war going on in the republican party over the question, what do republicans care about more? reducing the deficit or cutting taxes? these two things are in conflict because in order to reduce deficit, republicans need to make deals with democrats. in order to cut deals with democrats they'll have to put revenues on the table. democrats won't be willing to do major spending cuts to poor people and seniors in the republicans simply say, no, sorry, the rich are not going to pay a dime more. those republicans who are solely concerned with taxes have a leader. they have a general, a powerful unelected enforcer who has achieved an almost mythological status in washington.
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he is grover norquist. >> since creating tax reform, for ronald reagan's behalf back in 1985, norquist has been responsible more than anyone else for rewriting the dogma of the republican party. >> republicans won't raise your taxes. we haven't had a republican vote for a income tax increase since 1990. >> and this was your doing? >> i helped, yeah. >> it began with a simple idea of getting republicans all over the country to sign a note called the taxpayer protection pledge promising their constituents that they would never ever vote for anything that would make their taxes go up. >> speaker gingrich's tax pledge back in 1998. >> once they sign the pledge, grover norquist never forgets. the more signatures he's collected, the more his influence has grown. >> i think to win a republican primary it is difficult to imagine somebody winning a primary without taking the pledge.
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>> that was the cbs' steve kroft talking to grover back in november. since then incumbent dick lugar faced a primary challenger, his name was richard murdoch. he was one of those republicans that refused to sign the pledge and he endorsed murdoch. last week luger was defeated in the indiana senate primary. he only endorsed him a week before the primary. his no-taxes pledge gets a public relations boost. republicans become more afraid of it. it becomes more powerful. that grover norquist plenlgs says not only can you not raise a tax rate, but even if you close a tax loophole, that money can't go to the deficit. it has to go back into a tax cut or else he will consider that a tax hike. for years and years he was an
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unchallenged force within the republican party, a unilateral king maker. many have signed his pledge, at least until a year ago when arguably the most conservative republican in the senate broke rank. >> but here's -- if people's taxes go up in some way, it would appear to be a violation of the pledge that you signed with taxpayer protection pledge, and this piece, you vow to oppose any debt elimination or reduction of credits unless matching dollar for dollar reducing tax rates. if taxes go up in some capacity, would you not be in violence of that pledge? >> well, i think which pledge is most important, david, is the pledge to uphold your oath to the constitution of the united states or a pledge from a special interest group who claims to speak for all of american conservatives when, in fact, they really don't.
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>> a lot of people thought he was crazy for launching this fight but he's not alone. in politico, a small but increasingly vocal group of freshman republicans are publicly rejecting the idea they are beholding grover norquist's tax reform plan. there are not many of them yet. political reports say other freshman members have been privately struggling with the pledge. you don't want to be the only house republican to break the pledge. but you can be one of many who jump to make a deal. and it seem that is more and more republicans might be mentally preparing themselves to make that jump down the road. joining us now is oklahoma republican senator tom coburn, a member of the simpson bowles fiscal commission, author of "debt bomb." a bold plan to stop washington
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from bankrupting america. thank you for being here. >> good to be with you. >> you're a conservative guy. what do they say about your attitude against the taxpayer pledge? >> it's a non-factor. just some constructive criticism. i think it's totally overblown by the press. we agree that the government shouldn't grow. we want the lowest tax rates we can have. we don't want to raise taxes on anybody. simpson bowles had me and senator greg on it. we voted for reforming the tax code which would raise revenues. we had 33 senators vote to eliminate the ethanol blending tax credit. it's overblown. we want to fix the problems in the country. we're willing to have increased revenues for the government. our problem with the grover tax pledge is he randomly picks what he decides is a tax increase.
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i would tell you that eliminating tax credits and tax gimmicks and tax loopholes is eliminating spending, it is not raising taxes. >> i think this is an important point. the tax code has these things called tax expenditures. they give people money to help buy a house. they give oil companies money. they give money for ethanol, millions of other things. they are bigger than medicare. they are huge. with more than a trillion dollars according to the tax policy center. alan greenspan says he should be considering spending. and donald marone says they should be considered spending do. you consider them spending, or are they just spending disguised as parts of the tax code? >> i do. >> one thing that can be hard to figure out given there's been many republicans, almost all of them, who have signed the pledge is, is it just them in a negotiating position? you mentioned behind closed
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doors in simpson bowles there were varying degrees, willingness on the side of republicans, to raise taxes above where they currently are now in regards to the deficit deal. if it's overblown, what should people take of the fact that so many republicans have signed it? >> i'm not sure. in the heat of a campaign, i would tell you i don't think indiana, grover had any bearing in indiana, most of it was about repealing the affordable care act, not about taxes. it was about not spending money that we didn't have on things we don't absolutely need. so what i would say is the reason we're stuck on senator isn't grover. the reason we're stuck on center is we haven't heard from the administration what they're willing to give in terms of entitlement reform, saving medicare, saving social security and what can we do to reform the tax code so the revenues to the government actually come up. they are historically too low, most people agree with that.
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the point is what we have is tremendous advantage this last week. the flood insurance bill that i held up in the senate, why did i hold that up? because it has a billion dollars www.of subsidies for flood insurance for people's second and vacation homes on the coast. should hard-working american factory workers and service workers pay and subsidize somebody's second vacation home? that's spending in the tax code. accords to grover if you eliminate that subsidy, you're raising taxes. >> you're a member of the fiscal commission. it's productive and came out to some degree with bills. so let me ask you about the democratic side of this, too. when you and your fellow republicans get together with democrats behind closed doors, is there more agreement than people just watching what happens in public in washington? >> by far. by far. when we all get together and talk and the cameras aren't rolling and the press isn't there, everybody knows we'll have to do a lot of changes to
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medicare. everybody knows we'll have to reform social security to make it sustainable in the long run. the question is how do you get the mix of change. in the entitlement programs and the tax code. nobody says it shouldn't be progressive. how do we make sure somebody on social security has enough money to survive if that's their only source of income. how do we do those things and where is the grand bargain. we are going to get there because the rest of the world isn't going to loan us the money. the question is why aren't we doing it now rather than piddling around with the politics of today. >> senator tom coburn, a member of the simpson bowles commission and author of "the debt bomb." which i read and is very good. you should all take a look at it. >> good to see you. coming up next, the facebook haves and have-nots.
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you know who this guy is, right? bono is one of the one-name wonders of our age. the singer and presence of u2, an enormously successful rock band. bono seems like a relatively nice guy. not just on the rock star curve, but generally nice for a human, nicer than you and i probably are. he spends an enormous amount of time raising money and doing activism for causes like aids in africa and has had an enormous impact on the issues. he acts like a family man and has been making great, great, great music with his band, u2 since before ronald reagan was
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elected president. bono has been making great music since this kind of hair was fashionable the first time. this is u2's first big hit before "beautiful day" and "i still haven't found what i'm looking for." a bit about your eyes make a circle. i don't know what that means in english, but it transitions into a lot of record sales and a fair amount of money. today the middle-aged bono with the good works for humanity and the nice family and the endless hits and the large-sized fortune, he became incredibly fantastically rich, quite possibly the richest musician in the world. passing paul mccartney. it's not as a reward for philanthropy and weirdly not because of his music. it's because of this. facebook went public today. the company sold stock for the first time. its initial public offering, its ipo, the term of art or acronym of art. in an instant facebook became a $100 billion company.
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along with other lucky people, that made bono richer than rich. in bono's case it is because his use of wealth, he already had a private equity fund called elevation partners. he invested in start-ups like yelp, dropbox and facebook. bono's firm bought a small stake of facebook a few years ago for the small fortune of $90 million. depending on how facebook fares on wall street, that stands to be an enormous fortune now, well over a billion dollars. bono being bono says he'll use most of the money for his charity work in africa. a real sense what they and all the other early investors are doing is good for the economy and is great even. their willingness helping companies get off the ground is what usually gets companies off the ground. that investor might been another kid in a dorm with a good idea that kept crashing the servers.
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one of the features is that the company did set aside stocks for ordinary folks to buy. for the trading count of $40 or so, you could have bought a splinter, not even a hair of facebook stock. but to have got in a big chunk when facebook was not already a $100 billion company, which is when bono bought it, you had to be rich and well connected like bono with millions of dollars to begin with, and you had to be the kind of guy that every guy could do backflips with. you take that call. everybody would take that call. this really is a story of modern equality in america. the rich and the powerful and the well connected getting richer and more powerful and more well connected. when you hear that line, the rich getting richer, this is how they do it. when i see the story of facebook, it is a story of modern income and equality. what i mean is people got rich in the early informsment investments are not smarter than everyone else and work harder than cops and teachers and truck
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drivers. but most of them don't even know how to code. you can lock them in a room for a year and they would never approach anything that went to 1,000 fortunes. consider the twins that stole the idea for facebook. they wouldn't be in the story at all if they didn't land in the elite school like harvard and they made many, many millions over having their idea stolen. and if you haven't checked in with them lately, they are making more money selling pistachios on tv because they are the really rich facebook guys. pay them more money, put them on tv! there is no moral judgment here. not a moral question why it is that bono gets to be a technology mogul. not a matter of right and wrong. bono has done nothing wrong. but you and i couldn't invest in facebook three years ago. that is a thing they don't have
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to worry about, inequality of income. with enough inequality of income, there is nothing approaching equality of opportunity. it buys you and your children opportunities. i don't mean to pick on facebook here. facebook. i love facebook and i use it every day. you can like my page. i beg you to like my page, but today in addition being a site i'm addicted to, facebook is also a metaphor for the insider/outsider dynamic at work in our economy. you and i create the content that gives facebook value. every time we post a picture or like or share things or play games or change our relationship status, facebook gives us a way to do that. we the public, hundreds of millions of us, give facebook value. we made it on our backs a $100 billion company. it is the inside who is the cash money out of the value. it is not in the main your aunt or uncle who bought a couple of shares. it's in the lawsuith