Transcript: Democrats Debate the Economy

Following is a transcript of an extra topic of conversation — the economy — discussed by the candidates after the NPR/Iowa Public Radio debate. It did not air during the radio debate.

The candidates attending were Sen. Joseph Biden (DE), Sen. Hillary Rodham Clinton (NY), Sen. Christopher Dodd (CT), former Sen. John Edwards (NC), former Sen. Mike Gravel (AK), Rep. Dennis Kucinich (OH) and Sen. Barack Obama (IL).

The debate was moderated by NPR hosts Steve Inskeep, Michele Norris and Robert Siegel.

SIEGEL: Senator Clinton, you remarked that our situation with China is constricted by the fiscal condition the country is in right now. All of you, as you look ahead at the prospect of being president, the possibility of a recession this year, how many years do you think it would take before the United States could set its fiscal house in order, stop running deficits, and get to a position where we don't have a mounting enormous debt that, in one instance, gives the Chinese such leverage over us in so many areas?

SEN. CLINTON: Well, I think our recent history shows that when it comes to cleaning up the deficits and debt that the Republicans leave us, it takes a Clinton to clean up after a Bush. And that's going to be very difficult because we've gone from a projected $5.6 trillion surplus to a $9 trillion debt. But it is among my highest priorities because I think the dangers we face from being so indebted to countries like China and so many others, including Mexico and everywhere else in the world, and the leverage they hold over us because of their ability to dump dollars, should they choose to do so, combined with how it has constricted our ability to invest in our future, is among the challenges we're going to have to address because I do believe that our next president — and I think that will be me — will inherit one of the most difficult domestic and global economic situations we've ever seen.

SIEGEL: Do you think you could right the ship in one term, you could set our fiscal house in order in that time?

SEN. CLINTON: Well, it took — it took eight years — from '93 to 2000. It just depends upon what the conditions are once we actually are in charge.

NORRIS: I just have one follow-up. You said it takes a Clinton to —

SEN. CLINTON: I did say that. Yes.

NORRIS: — to clean up after a Bush. I want to give you a chance to let you respond to something that I have heard over — and my colleagues have heard over and over since we've been here. In looking at the sort of hopscotch Bush-Clinton-Bush-Clinton, one of the things that voters keep asking, sort of saying out loud, is, is it really prudent or appropriate for two families to control the White House for more than two decades? Your response to that?

SEN. CLINTON: Well, I don't think it was prudent to have the Bush family in the White House at all. (Laughter.) That's been one of the unfortunate consequences of our recent history.

But what's great about this country is that people get to make up their minds to judge everybody who's running. There is no dynasty. There is no, you know, determination from on high. People get to vote for whomever they want or vote against whomever they want.

SIEGEL: Senator Gravel, the outlook for — for your administration.

MR. GRAVEL: I think the outlook is very, very bleak. We have a 50 to $70 trillion tax gap, and it won't be solved by any administration in a conventional fashion. The only way that I can see is by changing the culture, and the only way we can do that is by changing our system of taxation.

The income tax is very corrupt. It places the burden on the average American. If we can change to what I call a fair tax, a retail sales tax, we will then be changing the culture from a consuming culture to a savings culture.

SIEGEL: It would be less regressive than the income tax — a retail tax?

MR. GRAVEL: No, it will be just as progressive. In fact, it would be much more progressive than the tax system we have today. And that will then change us from a consuming culture to a savings culture, which will bring about the wherewithal to retire not only the government debt, but the private debt, which is just as debilitating as the government debt.

SIEGEL: Thank you, Senator — former Senator Mike Gravel.

Senator Obama, what's your sense of the future, economically?

SEN. OBAMA: I don't think we can balance the budget in one term because we're going to have a lot of pressing investment needs on education, on health care. But I think we can start putting ourselves on a path of fiscal sanity. That means ending the war, it means rolling back the Bush tax cuts on the wealthiest Americans, it means creating transparency in how we spend money, so we're cutting pork barrel spending, we are eliminating bridges to nowhere, we are looking at how the Pentagon is allocating its resources to make us more secure, as opposed to just fatten defense contractors.

And the long term — most important — we've got to fix our health care system, because that is the nightmare scenario. Medicare and Medicaid will create an enormous drag on our economy and our federal government if we don't fix it, and that involves creating a health care system that works for everybody and improves prevention on the front end.

SIEGEL: Senator Obama, thank you.

Senator Chris Dodd.

SEN. DODD: Yeah, Robert, I'm a pro-growth Democrat. And I believe that you — I think putting a time frame on this would be a rather difficult answer to give. I don't think any of us can answer that question absolutely, knowing the problems that are out there.

I would not wait even until January of 2009. I think energy policy and health care policy need to be something you begin to work on immediately, and I plan on doing that in November of 2008 after the election. They've got to be a top priority here because the health care issue is no longer just a health care issue, it's a massive economic issue for us.

I also believe we need to have progressivity in our tax code, but also incentivize the various elements in our country that do create jobs in this nation, who have been disadvantaged, and eliminate the tax breaks that encourage businesses to leave the country, so we can offer some optimism and hope for people about economic opportunities for them here. Trade policies — I will never sign a trade policy that doesn't have labor standards, environmental standards and health standards in it to create wealth in countries with whom we trade so there's an opportunity for growth in that area as well.

These are the basic elements that I think we need to address immediately to offer people a sense of hope and confidence that our economy is going to improve dramatically.

SIEGEL: And Senator Biden, the question is to you.

SEN. BIDEN: I'm extremely optimistic. I have incredible faith in the American people and the ingenuity of the people if just we lead them. Number one, if you start by ending the war in Iraq, that's $2.5 billion a month we are spending. If you change the tax policy in this country, eliminating a trillion dollars worth of taxes over the next couple years going to people in the top 2 percent; if you in fact have an oil policy — just by having a rational oil policy, we could take down the — the — the fact that we're now being charged 30 percent more for every barrel of oil because of speculation about war; if you have a health care policy, which the country is ready to embrace, you can radically make American companies more competitive when they compete internationally; and if you deal with these things straight up with the American people, they're ready to front-end make an investment, make some sacrifices in order to provide this opportunity.

I'll conclude with this. Name me another country in the world you'd want to be the president of that has a better opportunity, a better opportunity for economic advancement and significant growth over the next 20 years.

SIEGEL: I won't answer, because that could make for a much more complicated debate even than talking with the seven of you for this country.

Senator Edwards, your sense of what could be done in four years.

SEN. EDWARDS: Well, the most important thing is we know from history that growing the American economy and being able to sustain that economic growth over an extended period of time requires both lifting people out of poverty and strengthening the middle class. Those are the times when the American economy has been on the kind of firm foundation that sustained long-term economic growth. The middle class in this country is struggling mightily these days. We've become a country where wealth and power has become concentrated in a few, and most of America's having a hard time.

So the question is how do we get rid of the structural deficiencies in the American economy that are creating that environment? There are a variety of things that we need to do. Universal health care, which others have spoken about, is crucial. Half the bankruptcies in America are the result of health care costs.

Our dependence on oil is strangling the American economy, so we need an aggressive effort to get off that dependence and get toward cleaner alternative sources of energy. We have to lift people out of poverty by raising the minimum wage to $9.50 an hour, expanding the Earned Income Tax Credit, strengthening the right of unions to organize in the workplace. Protect people's assets by having a national predatory lending law, having a housing policy that actually works. Our housing policy in America is dysfunctional. It concentrates —

SIEGEL: Could it all lead to a balanced budget in one term?

MR. EDWARDS: I think it would take two realistically. And can I mention one last thing?

SIEGEL: A very short one.

MR. EDWARDS: Also making it easier for kids to go to college. I think all those things in combination grow and strengthen the middle class, which is crucial to eliminating the deficit.

SIEGEL: Congressman Kucinich, you have the last word, your sense of the future of this country's economy over the next four years.

REP. KUCINICH: Well, with Senator Clinton saying that it takes a Clinton to clean up after a Bush, Hillary, I want you to know, this is the first argument that I've heard for you to be on my ticket, so I'm glad to hear you say that.

I think that we need to recapture the Democratic Party's tradition of providing economic opportunity for people. Here's how I would do it. Jobs for all, a full employment economy where the government becomes the employer of last resort when the private sector gets rid of jobs. We have to create jobs. Rebuilding America, a new WPA, put millions of people back to work rebuilding our roads, our bridges, our water systems, our sewer systems.

Put millions more back to work building new micro technologies for wind and solar, lowering our carbon footprint and enabling a transition away from oil, coal and nuclear, and — and have a not-for-profit health care system. And I'm the author of that bill, H.R. 676. Medicare for all, it's the only way to go.

Thank you very much.

SIEGEL: Congressman Kucinich, thank you very much, and thanks to all of you.

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