DISCLAIMER: THE FOLLOWING "Cost of Freedom Recap" CONTAINS STRONG OPINIONS WHICH ARE NOT A REFLECTION OF THE OPINIONS OF FOX NEWS AND SHOULD NOT BE RELIED UPON AS INVESTMENT ADVICE WHEN MAKING PERSONAL INVESTMENT DECISIONS. IT IS FOX NEWS' POLICY THAT CONTRIBUTORS DISCLOSE POSITIONS THEY HOLD IN STOCKS THEY DISCUSS, THOUGH POSITIONS MAY CHANGE. READERS OF "Cost of Freedom Recap" MUST TAKE RESPONSIBILITY FOR THEIR OWN INVESTMENT DECISIONS.
Bulls & Bears | Cavuto on Business | Forbes on FOX | Cashin' In
Bulls & Bears
This week, Brenda Buttner was joined by Tobin Smith, Eric Bolling, Pat Dorsey, Matt McCall and Sarah Flowers.
Are Town Hall Protesters Saving the Economy?
Tobin Smith, ChangeWave Research: A lot of people were thinking that the Democrats' health care reform plan was this unstoppable train moving down the tracks. But these town hall protesters are showing that this train can be stopped. They really are taking it off the tracks, and hopefully this will lead to a better plan for reform that will actually grow business and increase ingenuity in the health care sector.
Sarah Flowers, Democratic strategist: What's getting lost in the mind of these protesters is the economy. Poll after poll shows the economy is the biggest concern for Americans right now. What we're missing in this discussion is how we're going to reform health care costs. The rise in health care costs is the number one reason most middle class Americans don't have more dollars in their pocket. People who get insurance through their employer don't know what it all costs despite the fact premiums are going up by 20 percent to 50 percent. If companies have to pay more to cover employees, that means average workers won't see a rise in wages, and thus a lower standard of living.
Matt McCall, Penn Financial Group: The fact of the matter is that our current economy has to deal with the biggest deficit in its history. Health care reform as it's proposed will add considerably to the deficit. The result is that the economy will get worse. The stock market's rally shows that the markets do not want the version of health reform being proposed.
Eric Bolling, FOX Business Network: I think the economy and the stock market are on different trajectories. The economic outlook shows that we probably can't afford health care reform as its being proposed. Yes, at President Obama's town halls we've seen almost nothing but supporters of health care reform. But at all the other town halls, we see significant numbers of people telling their Congressional representatives to slow down and really consider what the consequences of health care reform are going to be. What Congress is proposing seems to be very different from the reforms the majority of Americans want to see.
Pat Dorsey, Morningstar.com: Neither side seems to be focused on what really matters. Our physicians currently have incentive to do more but not provide quality care for patients. Doctors are paid for conducting procedures, not the outcome of a patient's health. That's the fundamental problem with how the health care system works today. Unfortunately, none of the plans in Congress address this core problem. But it's not just Congress--the people against reform aren't doing anything to solve this problem either.
Stimulus Cash for School Supplies Spent on Cigarettes, Beer: What?
Matt McCall: I thought all this stimulus cash was designed to create jobs. How is giving somebody $200 creating jobs? If you give a man a fish, he eats for a day. Teach him how to fish, he'll eat for a lifetime. The government is just handing out fish, rather than actually creating jobs with the stimulus. The thing is: other countries that passed their own stimulus bills are creating jobs.
Sarah Flowers: This is stimulus. We have to feel bad they're not getting crayons and scissors, but it is money being spent. Remember when George Bush sent $300 checks to all of us? This is all money that goes directly into the economy.
Tobin Smith: This is not stimulus. This is as stupid as when George W. Bush sent out stimulus checks to everyone. Going by Sarah's logic, if we break all the windows in our home and replace them that would stimulate the economy. It's ridiculous. Economic stimulus means you spend a dollar, but it creates $1.50 or $1.75. It increases economic productivity and monetary velocity.
Eric Bolling: This stimulus is creating nothing but free money junkies. Congressional enablers just keep this process up to buy votes for the next election. But eventually the money is going to run out. What we're left with are people who can't work, who are lazy, and just sit around on the couch all day.
Pat Dorsey: It sounds like having a voucher for school supplies would have worked much better if that was actually the intent. At the end of the day, infrastructure investment is a better enhancement of economic productivity than just cash handouts to people.
Is the Pay Czar Coming After Your Paycheck Next?
Eric Bolling: The pay czar is going to tell TARP banks what they can earn, and it's going to be low. I think non-TARP banks are going to look at the lower levels of pay TARP banks are giving out and lower their levels of compensation. TARP banks having wages set by the pay czar are going to lower and repress wages in the financial sector. It's never good when the government dictates the price of something--regardless of what it is.
Tobin Smith: This is high-end labor. The financial services industry already overpays and has a bizarre compensation model. Ultimately, these lower wages will stay within TARP banks. If I were a CEO, I'd be worried about the pay czar expanding his power down the road and deciding what other CEOs and top executives deserve to get paid.
Pat Dorsey: Executive compensation has been out of control for a long time. These TARP banks took government money, so the government is going to have some say in how the banks compensate their executives. What I'd be afraid of is non-TARP banks poaching top talent from TARP banks because they'll pay more. In no way, shape or form will this go across the industry. Only TARP banks will be negatively affected.