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tv   [untitled]    May 12, 2011 4:00pm-4:30pm EDT

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the dollar is in the dumps so how to fix that a once radical idea only found at the end of the rainbow may not be so radical anymore but will this move make the us economy as good as gold. and crude intentions on capitol hill this as c.e.o.'s from major oil companies get grilled over subsidies and tax incentives so as they get a public lashing from senators for anything really came. to life in the school that the united states was the greatest country in the world because if you just work hard you can be part of this magical middle class what middle class might
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not be the once american dream and now a distant memory for many living in the u.s. as the middle class dies in america it's growing elsewhere we'll take you to india to see the economic boom there. and there it's thursday may twelfth four pm in washington d.c. i'm christine freeze out there watching our city. well have you ever heard of the expression as good as gold well it's starting to take on more and more meaning these days and more people are talking about returning the u.s. economy to the gold standard and i know you're thinking this sounds crazy a radical idea and it once was reserved for seemingly radical people but things are changing steve forbes well known businessman c.e.o. of forbes and editor in chief of forbes magazine couple time presidential candidate
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is an interesting prediction he said which is of the gold standard by the united states within the next five years now seems likely since that move would help the nation to solve a variety of economic and fiscal monetary ills and it's not just forbes author and investor jim rogers also says the situation is getting worse he predicts problems and came down hard on fed chairman ben bernanke saying quote the money doesn't understand economics he doesn't understand finance he only understands printing money and we can't drupal the amount of money in the next slowdown but let's talk more about this i want to go to c.e.o. of gold line scott carter he is in our los angeles studio. so scott obviously something you believe in gold but you have been in the minority for a while in sort of the radical class of people how's it feel now that your ideas are becoming a little bit more mainstream. well i think christine thanks again for having me i think many people are starting to see the value of gold as
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a part of their portfolio for diversification it's always been a great hedge against a falling dollar or inflation and that seems to be what the issue is here it's a dollar issue and gold is shining very brightly as a result of you know on if the dollar was as good as gold or that other people would want to buy and this is a quote also from steve forbes but let's look around and support that actually with what's going around or around the world this year mexico but around one hundred tons of gold that's according to the mexican central bank one of the global implications here. but i think it's a key point central banks used to be not sellers of gold they were providing most of the supply of gold in the marketplace most recently the central banks have either been holding onto the ball that they've been on or they've been buying gold so not only mexico but russia has been buying gold the central bank of india bought a significant amount of gold a year and a half ago we know that china is building up
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a gold supplies so clearly central banks who really are in the know with regard to fiar currencies or paper currencies they want to diversify against or away from fewer currencies in gold as one of the asset classes of choice that they may it does seem that you know in contrast to maybe the euro zone i think there's a lot of lost confidence in the u.s. dollar sort of confirming you know. there's a lot going on steve forbes people know that something is wrong with the dollar he said so i want to get your take i mean working for gold mine you know and what happens next we implement gold we bring back the gold standard to the united states as it was you know until world war i and what changes here is there's the economic crisis hits our. well i think what changes is that are put handcuffs on central banks and i think that that's really what jim rogers and steve forbes and others are saying is that we have to control the amount of money we're printing right now
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as you said the dollar used to be reserved as or stated as good as gold and not many in the world think that right now in fact there was a phrase that our currency your problem was an old phrase and the world is not happy with the fact that they are holding a lot of our treasuries and it's losing value also christine the big fact is that we continue to add to our debt we're spending about a trillion and a half more every year than we're bringing in in tax revenues and that is only devaluing the dollar long term at goldline we talk to individuals that are concerned about their buying power and that's why they're buying gold as one way to move away from dollars and have another asset that might perform well in a weaker dollar environment you know it's really interesting just this week we had a bunch of leaders out from the financial area areas in a china coming to town to talk to some of our biggest leaders here are they spoke with vice president biden they spoke with secretary of treasury geithner secretary of our secretary of state hillary clinton amount of variety of issues that i think
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the main issue that they really needed to touch upon was about these financial issues and the fact that a lot of people are looking to china as sort of moving in the right direction what would happen i guess if the gold standard is implemented here in the united states in terms of that relationship with china and with the fact that well i think a very interesting and well that's true they do on a lot of our debt and i think there's a symbiotic relationship they don't want to see the dollar decline but they also don't want to see the united states in a recession because their economy is so linked to our g.d.p. growth but the fact is that it's important for the u.s. to have a strong dollar the world's reserve currency has to be strong and we cannot continue to increase our debts in our deficit so what. happens if there's some sort of gold standard well that would certainly limit the amount of dollars we could print central bankers will hate this by the way but it would put handcuffs on them and what they could print it would force our congress to live within our means which is
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good and bad it makes for a strong dollar but it also has some short term economic pain you know by the way christine we have a history of this it's not that long ago that we were on the gold standard it's only been forty years since we close the gold window under the notes that millions nixon administration so for most of our. existence as a as a country we've been on a gold standard it's only not been the case for forty years it's only been forty years but it was started to sort of like the take taken away i think around world war one time there and it was ben bernanke who said that the reason that we got into such have bustling bursting economy was because the gold standard was let go what about people like him who frankly are making some pretty big decisions right now they're in the positions of leadership and they're fighting against bringing the gold standard back that happened there i mean well that's a great point you get you have two schools of thought and i'm not an economist but you have keynesians you have austrian school of economics and a lot of times there are different viewpoints on what should be done so for those
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who are flexibility in being able to print currencies kind of like our current federal reserve chairman the gold standard will never be adopted but for those who want consistency and they want to hold a limitation on the amount of dollars that can be printed and then a gold standard will do that very effectively so that is the debate that is going on in the marketplace in what drives alternately the decision on gold when you think back though what's happened since one thousand nine hundred eighty one the u.s. dollars lost eighty two percent of its value since we went off the gold standard so that is a significant decline in our buying power another way to say is that everything cost more today because of the decline of the dollar and that trend is continuing in. it's starting to become a major drag on our economy and that's why this debate in my view is in the in the media and certainly on the hill in washington d.c. i want to go back to something you were saying about putting handcuffs on the central bank i mean seems to me it's really hard to handcuff the people you know
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it's hard on the police force in a way i mean implementing this gold standard would take the reins away from the elites here in my city and we take the reins away from those that preferred to manipulate the currency and to do what we've been seeing over these last few years i guess it's going to get your prediction on how we move from this as an idea of putting it into action where everyone's happy well that's right i'm not sure how the transition will take place i think steve forbes put a beachhead out there that says we've got to get control of our dollar the gold standard is our history that is one option i think you're absolutely right though christine is that the power of the fair is the ability to print money the ability to raise and lower interest rates if that limitation is removed or they're there flexibility is removed then the central bankers have fewer arrows in their quiver to address the economy and that's the chief argument against a gold standard however i think the pro of
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a gold standard is there the view that we will not get control of our debts and our deficit unless there is some sort of forced medicine like a gold standard like a balanced budget amendment we've had many things that we need to quit printing money we need to quit spending beyond what we're bringing in in tax revenues a gold standard is one option to do that i think an interesting question would be is that if we were on the gold standard in one nine hundred seventy one and every dollar was backed by gold what were the price of gold have to be today to go back to that scene point and i think that many people will be shocked at what the price of gold would have to be certainly an interesting question carter c.e.o. of gold line in our los angeles studio. well we've seen it all before from goldman sachs the b.p. c.e.o. was brought before congress to be grilled about their misdeeds by the tireless defenders of the american people the congress but through these so trials lead to
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real reform or are they a useful cerate as big oil dollars continue lining congressional pockets are just killing ford has more on the tough talk and the big profits of america's big five i think you're out of touch deeply profoundly out of touch and deeply and profoundly committed to sharing nothing and you have an easier time convincing the american people that a unicorn just flew into this hearing room than that these big oil companies need taxpayer subsidies or we have to pay you and your caving all right knowing the cost is not a certainty it's a legitimate tax deduction the c.e.o.'s of america's big five oil companies were in congress today you know that he championed the free market we love to compete i mean that is what we thrive on competition they were on the hill to defend something very different tax incentives credits and subsidies you know four billion dollars worth of man but if you see big oil companies who raked in a collective thirty five billion in the first quarter of two thousand one lone as
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the most vulnerable americans make a lot of money that's fine it's american way. but it also seems maybe the subsidies . are not really that necessary anymore but can it go phillips slammed those who want to end those subsidies as an american did you really mean to question my patriotism and the patriotism of the twenty eight other united states senators who are co-sponsors do you believe that president obama is an american because he has proposed cutting oil subsidies do you believe that former president bush speaker boehner congressman ryan are un-american because they have expressed cutting oil subsidies the plan which ink america's one point three trillion dollar deficit by twenty one billion over ten years and with gas hovering around four dollars a gallon and everything on the chopping block it was an opportunity for senators to show they feel americans pain do you think that your subsidy is more important
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than the financial aid we give to students to go to college could you answer that yes or no but it's very difficult question for you like big tobacco and goldman sachs before them boy that timberwolf was one shitty deal how much of that should you deal did you sell to your clients after june twenty two thousand and seven parading c.e.o.'s before congress so representatives can be grilled on generates press that leads to little reform the same oil companies testified in two thousand and eight and two thousand and five when gas prices spiked although c.e.o.'s then said they did it in a tax incentives you all have done as major oil companies a dramatic about face this morning in two thousand and five all of you were there mr maule but all of you said you did not need cacs incentives to drill for oil and could they you've come and say you've got to have them when oil was at one hundred
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dollars a barrel i just think up position defies common sense and big. oil's response to the extent to taxes or higher in the united states will look elsewhere to the extent that foreign tax credits are limited will it be even more difficult for us to compete overseas as well so with all the provisions that have been considered it will make it more difficult for us to do business raise the cost of doing business ultimately produce less in revenue for the u.s. government fewer jobs and. move against the president's agenda of reducing important oil commerce expected to go on the close big oil tax loopholes act next week but let's hope what nine million of lobbying dollars flowing from chevron twelve point four million i mean from exxon nineteen point six million coming from conoco phillips and seven point three million i mean you have america it's unlikely the public interest will be able to speak louder and black coal he when ford artsy washington d.c. all right so these c.e.o.'s of these major corporations enjoying some of the best
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most profitable years of their lives and gas prices are soaring meanwhile and what about those millions of americans who lost their jobs who were basically left in the dust of the two thousand and eight financial collapse which about just still settling joblessness is still at a peak so we want to know where is the working class headed in this country are the corresponding honest us your church going to delve into the struggle. the u.s. was once home to the picture perfect american dream a house a car and a job symbolize the middle class as the core of a prosperous country yet for an increasing amount of americans some or all of these are now out of reach this country was founded on the ideals of life liberty and pursuit of happiness so how can you be happy if you can't pay your rent how is this american a new initiative from the new america is littered with millions of homes lost and abandoned with the unemployed officially at over thirteen million still queuing to
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get a job does this mean the middle class is disappearing in the us there have been four pillars that supported the american middle class the chance to retire the chance to send your kids to higher education you know graduate school university a chance to work and afford a confortable standard of living and access to medical care and if we work all four of these pillars or chip cracked or sway today over sixty percent of americans see typically live paycheck to paycheck leaving little for college fees mortgage payments or retirement the u.s. is increasingly being divided into rich and poor with a traditionally large center and middle class being squeezed out the bottom fifty percent of earners today on less than one percent of the country's wealth america's gone from the most egalitarian nation on earth back in the one nine hundred sixty s. and early seventy's and now with the gap between the rich and the war is the widest in the united states than any of the industrialized nations so why every indian
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see the middle class is dead in america can look comes from a traditional american middle class family the twenty three year old college graduate lives in a rented basement and says middle class jobs just don't exist anymore i was taught all my life in the media and school that the united states was the greatest country in the world because if you just work hard. you can be part of this magical middle class i'm part of a generation of youth who will never have the so-called american dream finding work on average takes eight and a half months now and with six americans buying for each job the prospects for the country's youth look dim and the future of their lives is living in basements like i do you know some of them are becoming homeless others are going to prison there is increasing crime and drug use and things like that there's also the wars the military is you know they don't have a recruitment problem anymore now that the economy has declined so much. what has
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a decline is military spending i'm a teacher there's teachers laid off left then right this is the future of our country and we are spending more money i mean a tremendous tremendous billions being spent on war on the war machine priorities how do you devastating effect on middle and working class america and melanie samuels runs a food pantry in new york she says the face of hunger in america has drastically changed and now we're seeing people that do have an education and used to have decent jobs no one lie coming in teary eyed crying they never thought this would happen to them some forty percent of the forty three million food stamp recipients today are working americans and every fifth child now lives below the poverty line america grew prosperous on the belief that the next generation of workers would live better than the first but nowadays the outlook for the future is anything but
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optimistic we're going to see more and more of a squeeze more people on food stamps more people with kitchens and more malnourished hungry children in this country no question as the foundation of the middle class continue scramble concerns are growing that the heart of the american dream could stop eating altogether and if the middle class collapses the face of america in the twenty first century could become one this country has never seen before. archie. new york. and we've got to talk more about that so joining me here is to talk about the dying middle class is tom hartman host of the tom hartman so right here on our t.v. and i don't time you also if this is the object you know so much about you've written a book rebuilding the american dream where you looked into this in depth the numbers certainly saw it but what do you think are the clearest signs that the middle class is shrinking and shrinking well we've seen the wealth of the middle class wiped out i mean used to be that seven and from fact before reagan became president seventy eight percent of americans had defined benefit pensions in other words they could
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retire and they got a check until the day they died i mean that's down into the twenty's or thirty's now it's just wiped out before reagan became before basically what we're looking at is thirty years of things before reagan became president we were the largest importer raw materials in the world we brought iron ore into this country we made it into things like radios t.v.'s cars we were largest export of finished goods and we would lars what world's largest creditor we are now we've completely reversed that in thirty years we are now the world's largest debtor we're the largest importer of finished goods and the world's largest exporter of raw materials we've become the mining operation for the world and the consumer and and as productivity is can steadily increase during the last thirty years wages of flattened out this is a radical change from the previous two hundred years almost numbers always tracked in a film that gap people use their credit cards and they use their home equity and now the middle class is tapped out there come a point there i mean it kind of interesting that you point to president reagan who seems to be the one good old calway that
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a lot of conservatives point to as the best president of our generation and yet you're looking at him and saying you know he significantly changed things talk a little bit about those policies and how much you think they're still in place and sort of the politics that plays into them like my wife makes the joke that much i'm sort of going to say it all started with reagan it's when reagan was brought into power by two groups of people two groups of conservatives there were the russell. kirk conservatives who wrote nine hundred fifty three were called the conservative mind that is still the bible of the movement it was it animated william f. buckley it motivated barry goldwater it was and still today it is like most one of the most important books and and and kirk's worldview and that conservative worldview back then this was in the fifty's kirk was predicting that within the next twenty years thirty years because of this growth of the middle class we'd seen an enormous social instability and that that social instability would be a bad thing for america and sure enough it happened you said the spectrum of the
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fifty nine fifty three ok right sort of some rights movement right that's right out of the anti-war the year before brown versus board of education and he basically predicted these things and so in the seventy's you had people like william f. buckley jr and other conservatives thoughtful conservators looking at what was going on and going oh my god this is incredible women are burning their bras you know kids are say hell no i'm not going to go to war that you've got african-americans are demanding their rights you know gays the stonewall riots are you know it's like this is things are out of hand and their cities are burning i mean there were riots you know and so they said you know william kirk was right we've got to get rid of this pesky middle class so there are the ideologues taking on the middle class and then there's a predator is gone yeah ok we can make some money on this thing and they took down the middle west and really really interesting thoroughly what's happening here is a trend that we've seen changing but there's transferring it a different direction in other countries for example india they're seeing the growth of a new middle class an r r r g correspondent for history there is there right now
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and she's talking about what's going on and what's making this happen or take on. tell you all is living the dream age of twenty eight the former investment banker is now running a restaurant and bar in the heart of south delhi then years ago if i were to tell me about this from my father would have given me for but you have to finance it wouldn't just fight i'm open to being missed in my own can because you. but in the past ten years india has experienced enormous change and with a came a new set of hopes for the world's youngest population is a market is huge the opportunity to. ordinances they can spend money tales bar is located inside this small town of around six hundred macca malls that have sprung up in india within the past decade and it's driven by the desire to get a good brand and is one of money. so combine the desire and ability
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is going to do. today indians can get just about any international brand from hong kong to the u.s. to the u.k. it's access to this change the mentality of many to be for ten years the people. says the group is there the globalization is the. thinking in a very different manner india's economy is booming twenty five years ago ninety percent of the population lives on what than a dollar a day by twenty twenty five forty percent of the population here will be classified as middle class and with a growing income india is seeing a new culture of consumerism and brands from around the world are ready to cash in on it india is a huge country with one point two billion. and so even if everybody spends at ruby so it's a huge sum but despite the success most indians are aware that the country still
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has a long way to go and while things are moving in a new direction and there is a large portion of the population who is at risk of being left behind and that this baby is widening be able to go very rich plazas getting richer and the poor plazas getting poorer but largely middle class indians and especially the young working demographic try to focus on the positive and watch with pride as their country comes of being and is able to achieve a global status they always believed was possible it's. better for us i mean earlier western countries used to think that publishing is a burden but now i guess even the area lazing that the more the people the more the purchasing power the more the mining the more that number guns power that is difficult for the world to ignore preassure either r t new delhi india. someone to talk about this i mean we have not only a trial. and of the shrinking middle class in the united states but a growing middle class in other countries like india is so us you know the money is
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being spent people are getting jobs in what we would consider middle class ranges so let's talk about the contrast that's going on here mean you can't drive down any highway in america without seeing you know either homes foreclosed or southern factories these are factories that provided jobs for so many middle class americans there in contrast with what's going on in other countries like india where they're investing in their middle class yes and a large part of it has to do with trade policy in seven hundred ninety one alexander hamilton who george washington said we're going to do something about this when he was first when he was informed but he was elected president he had he henry knox came up of course and told me i was standing in this field he said in the six weeks ago to the president and he said i was off to do things say goodbye to his mother who died shortly thereafter and buy him a suit made in america it was illegal in the nicest make frank clothing at the time
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so washington. hamilton said we want to build an industry you know here in this country and most importantly this eleven point plan and seventy one was about the by congress in seventy ninety three and from seventy nine hundred three until the reagan administration we built things in this country because we protect our industries we subsidize their industries we had tariffs of our borders that was not an original idea to hamilton he took it from the british it was called the king his tutor plan king henry so seventh actually he stole it from the. dutch and so it's been around for a long time so you know what's happened over the last twenty years thirty years is that the indians and the chinese have picked up basically hamilton's plan and reagan and bush and clinton all abandoned it so that you know the policies here are directly related to what we're seeing we have no trade policy a sense of i mean other than you know joining the world trade organization and surrendering our sovereignty to a big national corporate transnational. russian let's talk about i know india is not the only country where things are kind of going right but i know that you on
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your show you speak a lot about germany and some of the things that they're doing there to to make sure their middle class is moving in the right direction well yeah first of all they have a trade policy that is highly protective which a lot of people complain about but it works just fine for them thank you very much secondly they're generating electricity like crazy they would if they're gone in ten years from virtually nothing and solar power generation to twenty thousand to twenty to twenty twenty gigawatts if you go out is a million watt so so it's it's that's the equivalent of about twenty nuclear power plants really briefly we're almost out of time but eleven point plan from alexander hamilton what are the next you know what's the five point plan that president obama and the future leaders of america should jump on in order to change things change the direction of this country number one go back to hamilton's plan number two roll back the reagan tax cuts on the super rich stop the crazy speculation number three
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rein in wall street bring that class stiegel. i'm not sure that i have five of these up ahead but i think that you could sort it seems that you know here in washington we see evidence of this all the time a lot of people that make decisions they may look like the elected officials but it's actually the people lining their pockets the lobbyists how do we get it how do we get says this is a promise and brought to us largely by the supreme court and you know it's going to have to i think frankly it's going to be addressed with an amendment to the constitution citizens united needs to be able to turn at some point in a certain think president obama would agree with you but a lot of others would not tom hartman host of the big picture there right here on r t thanks for joining us and that is going to do it for now but for more on the stories we covered that aren't see dot com slash usa also check out our you tube page you tube dot com slash the america i'm christine for we will be back here in a half hour with a whole lot more thanks so much for watching.

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