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WORRIES GROW GOVERNMENT POWER GRAB IS HURTING JOBS, STOCKS
Gary B. Smith: Absolutely killing us, all you need to look at is headline unemployment number, it's remained locked in at the 9, 9.5 percent number and it's even higher than when Obama took office. As a sop to the unions or basically want to shut down its new plant and there goes thousands of jobs. Look at the oil industry, how long was the drilling in the Gulf shut down? When it finally opened, Exxon discovered the newest oil discovery in the past 25, 50 years or so. Look what it's doing to the banking industry, everybody thought it's cleaned up. Try to get free checking now days, the list goes on and on and on, government acts like a tax, moving resources from most effective to least effective, you talk even about the auto bailout. Great, GM jobs are created in a less efficient company where they could have been created at Ford.
Sarah Flowers: I fundamentally fail to see how an education training program is a power grab. And step by step, if you're looking for the first time in our history, there is less unemployment among the oldest group of workers and more unemployment among the youngest group of workers, why is that? Because the oldest group of workers are hanging on to their jobs because they have a greater skill set and the younger workers can't compete. We have to get the training to allow them to compete in that marketplace.
Tobin Smith: Remember training is a great idea if there are jobs, but we have a bigger issue which is the intervention of the government into the private sector, on a massive scale, and a scale that is preventing companies from growing. Remember, 70 percent of our economy is a consumer, the consumer is flat on their backs because we're not hiring and we're not hiring because we don't have an economic engine to drive it. When you get the hands of government, go back to the 70s and the 80s when we stood Fannie Mae and Freddie Mac started taking over mortgage business, every time we've gotten heavy into something you retard private market growth. That's where the real jobs come from.
Eric Bolling: We have an anti-job climate. Businesses aren't hiring, you look at Obama care, Cap and Trade and so many things driving businesses either away from America or driving them not to hire, they'll buy equipment, they'll do things like that, but they're not going to hire more people because they're afraid and frankly, they're right.
Jonas Max Ferris: Current government stuff over the last two years and the job market it depends on the industry. Banking was just bought up. I can't think of an industry that has a better employment picture because of government saving them. Anybody who tells you that doesn't know how great the New York real estate market is. The business was saved by the government. Let's move to another industry, I think that Boeing should be able to relocate to the South if they want to, in retaliation in some ways against the striking unions. However, will it hurt employment in America if they can't? No, because they're going to have to build where they are at a higher wage area albeit it will hurt their profits. Until Boeing is driven out of the country, which is a possibility down the road, it really isn't going to hurt US employment.
REPORT: 30 PERCENT OF COMPANIES PLAN TO DROP HEALTH BENEFITS DUE TO HEALTH CARE LAW
Tobin Smith: You don't have to be a conspiracy theorist. When children's insurance went away because they couldn't afford to offer it, which started the plan. Then this plan clearly made the choices such that no business would ever want to not pay the $2000 fine, which is what you get paid if you don't offer the coverage or the government has to kick in. You'd pay the $2000. Why? Because if you get them out of your system you're going to fix your costs. You know what your costs are going to be and this is exactly the plan all along. Everything I've read, everything I've heard from these guys before this came out, said single-payer is what they want and baby, and that's what they're getting.
Sarah Flowers: I think you need to look at the study closely. If it's done by the McKenzie Institute and you go to the methodology you'll note they educate their respondents, but don't tell you what they say to educate their respondents, which is why I think it's out of step with other similar questions that have been done by the Rand Institute, the Urban Institute, the Mercer Corporation, who don't find the same response. But the reason I think that is because between penalties and the tax offset that you would no longer make your company eligible for, it doesn't make sense for most companies. It would hurt their balance sheet.
Eric Bolling: Any way you slice it, let me educate your response, Sarah, the bottom line, the Association of Small Businesses is suing the federal government, in the 11th district with the 26 states right now trying to repeal Obama care because it will kill small businesses. They say enough, we don't want it. They can't afford to make the $2000 payment and can't afford to make the payments on all the premiums that are right now being jacked up in advance of Obama care.
Jonas Max Ferris: I think long haul this is going to turn into all government, except for high end jobs. There are a lot of things in the plan that are basically going to raise the cost to companies. You can't say there's no more ceiling on the insurance. Someone has $20 million dollars and can't kick out preexisting conditions. All of those raise the premium as if you wanted to buy the coverage. Many companies would rather just pay a relatively low fine. I've got to say I never liked the system where companies were responsible for our health insurance anyway that seems to be a drag on hiring people a good system is people who can afford to pay for their own insurance. If we go to that system and the government only picks it up for poor people, that would be great. I don't know if we're headed there. I never liked employer-provided health care and we'll get out of it slowly with this program.
Gary B. Smith: The reason you had employer-provided health care, it was a benefit to attract employees, just like any other vacation days, or you know, company cars and things like that, but I do agree with Toby. I think it was the plan all along. Beautiful in its deceit, if you will, to move people into the government-mandated health care. Unfortunately, it goes directly against what Bank of America said and comes back to what we talked about in the first block, it's a law of unintended consequences. Government gets into an industry. They don't think things through, because no one in their right mind can see every possible consequence. What will happen, people that like their company health care plans will be left to go into a federally run system, however, they won't have as good a benefits.
GOVERNMENT PREDICTING HIGHER FOOD PRICES SPARKS RECESSION FEARS
Eric Bolling: I think corn prices are driving all prices higher, food or toilet paper, gasoline. Everything is going up it's because corn has gone from $2 a bushel could be up to $7, up to $10 a bushel and this will cost us everywhere and that's going to drop consumer spending across the board.
Gary B. Smith: I guess I'm one of the people who disagree in this case with Eric. There could be, what Eric says coming down the road, hasn't shown up in the numbers yet. Just from the latest CPR report, I do agree meats, poultry, and dairy up 7 percent year to year, but other stuff like cereal, fruits, vegetables and beverages down below 3 percent year to year. I get this info from the Bureau of Labor Statistics, they look at the prices
Jonas Max Ferris: It's not across the board. I wish home prices were inflating and people's salaries were inflating but only certain items are going up. Their income is not going up and their wealth is not going up although the stock market has done okay and that creates a fear situation, I can't afford some things, especially if you're retired and living on fixed income and living on investments. These things are going up more than I'm earning and you spend less than that becomes self-fulfilling and could slow the economy down. We don't have official inflation, but I consider that a bad thing if it was the result of the strong economy it would be good.
Sarah Flowers: If food prices go up, that's not great for the average family. We need to solve this problem and look into what causes food prices to go up. Part of that is the system that we use to transport our food and the cost of fossil fuel. We're not going to be able to sit back until we change what we eat.
Tobin Smith: There's no question on a fixed income and average household, when the spending goes up on food, you feel less wealthy and feel like you're spending, taking from one pocket to the other hand. Will it kill our economy, no it won't. However, it hurts our household and when it hurts our household. Jonas is absolutely right. You spend less because you're more fearful. There's no question.
Tobin Smith: DuPont (DD)
Gary B. Smith: Apple Inc (AAPL)
Jonas Max Ferris: Pfizer Inc (PFE)
Eric Bolling: Exxon Mobile (XOM)