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Bulls & Bears
This week Brenda Buttner was joined by Gary B. Smith, Tobin Smith, Eric Bolling, Pat Dorsey and Tara Dowdell.
Democrats Pass $116 Billion in 'Stimulus'; More Spending Bills on Docket
Eric Bolling, Fox Business Network: They keep coming up with spending bill after spending bill. This bill is 28 pages. H.R. 4213 has things like $175 million for Indian reservations, $185 million for domestic film production, are you kidding me? How about Puerto Rico getting $185 million for its rum? How about the wool trust, the cotton trust, teachers get their benefits. Everyone gets their beak wet. The problem is, it's not creating any jobs, and it's just creating a lot of spending which will just turn into a lot of taxes.
Tara Dowdell, Democratic strategist: There are elements and measures of this bill that aren't going to directly create jobs, but there are some elements that absolutely will do so and have a track record of doing so. The Build America Bonds program was highly successful under the stimulus. The money is leveraged and it provides lower-cost financing to states. So the projects that it actually goes to fund are much larger and the economic impact is far greater. There's a project going on in San Francisco that was done through this program. Hundreds of construction workers hired, underwriting firms received $1 billion in fees. And this is going on around that country. Critical infrastructure projects that move people and goods through this economy have to happen. There is an economic and a public benefit associated with this program.
Tobin Smith, NBT Media: As this thing gained momentum this week the market got weak. Let's just look at the facts. Medicare: the same group that passed ObamaCare and said they wouldn't raise reimbursements to just put in $24 billion. Does that create one job? No. They did take Medicaid out but then they put unemployment back in. We know from Larry Summers that when you extend all these benefits, it keeps people from going out and looking for jobs. You might have a new bridge, but this money is an absolute waste just the way the other ones were.
Gary B. Smith, TheChartman.com: It's going to create jobs but what the Democrats always ignore is that these bills don't create any net jobs. All the government is doing is robbing Peter to pay Paul. Eric and Toby mention this insane spending in here but they forget the tax side. There are increased taxes on hedge fund managers, venture capitalists, multi-national firms, oil companies. But there's $1 billion spent on summer employment programs, all of which could have been avoided if we hadn't hiked up the minimum wage. We'll spend $100 billion and in the end employment will still be 10 percent.
Pat Dorsey, Morningstar.com: The only thing that creates jobs is time. Businesses gain more confidence, they have higher aggregate demand, they hire more people, and that's just a function of time. Nothing is going to bring back the jobs that we've structurally lost in construction, structured credit, mortgage brokering, because they're just gone for quite a long time, until the housing cycle repeats again in 20 years. I do reject that the slide in the market is tied to this bill going through Congress. That is utterly false. It's tied to what is going on in Europe. The spending to be worried about is the 75 percent of the budget that's going towards entitlements of which the current package under discussion is just at tiny drop in the bucket.
New Fears Offshore Drilling Crackdown Will Bring $5 Gas
Eric Bolling: At least $5 per gallon gas is already on its way! The moratorium in response to the oil spill on 33 oil rigs which equals about a million barrels of U.S. oil per day coming off the market. We were at $4.25 two summers ago without any oil disruptions.
Tara Dowdell: The announcement of offshore drilling expansion and freezing had the inverse reaction to oil prices. So no, I don't think this new freeze will cause a spike in gas prices.
Tobin Smith: All these new fees and taxes that are going to be imposed on oil companies are eventually going to be passed on to the American consumer which could have us all paying more at the pump.
Gary B. Smith: When we started to get up to above $4 we saw a dramatic drop in demand. In other words people just stopped driving. So, as prices go up, consumer demand shuts down and prices retreat
Pat Dorsey: Oil is a globally traded commodity. The oil we produce off the shores of the U.S. is not very large in the context of global supply. Frankly, this ban doesn't matter one way or another.
Rallies Break Out Today in Arizona Calling for Boycott and 'Buycott'
Tobin Smith: It's a recession! This is not the time or a place for Americans to be boycotting our own good and services while we're struggling to pull ourselves out of a recession. This will absolutely hurt the economy.
Tara Dowdell: People have a right to boycott and that's what makes America great. Unfortunately, Arizona didn't look at the unintended consequences of this law. And these unintended consequences are not good for Arizona's economy or the America's economy.
Eric Bolling: This will actually help Arizona's economy! For every boycotter there's a "buycotter". People will flock to Arizona businesses and buy their products. Let Arizona handle their problems, don't boycott them "buycott" them.
Pat Dorsey: This won't hurt the economy at all. Whatever people don't spend in Arizona they'll spend it somewhere else. It's not like Arizona has the worlds only supply of some mineral that we all need.