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Lou Dobbs on Economic Fallout From Japan Quake, Union Chaos

This is a RUSH transcript from "The O'Reilly Factor," March 11, 2011. This copy may not be in its final form and may be updated.

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BILL O'REILLY, HOST: Now for the top story tonight: If you diminish union power, how does that create jobs? Also, the big picture on the Japanese quake.

Here now to address those situations Fox Business anchor Lou Dobbs, whose brand-new program "Lou Dobbs Tonight" begins this coming Monday, March 14th at 7:00 p.m. All right. We'll be looking at that. Let's go to Japan first.

LOU DOBBS, ANCHOR, FOX BUSINESS NETWORK: You bet.

O'REILLY: I figure that country is out of the box for about a year now.

DOBBS: Yes.

O'REILLY: That's how long it's going to take to rebuild and reorganize. Is that going to have a ripple effect on the worldwide economy?

DOBBS: It will, of course, in terms of the markets. Tokyo is one of the largest equity markets in the world. Secondly, there is a perverse effect here and which is beneficial to the world economy. That is the material, the expertise, the labor that will be required to rebuild will actually be something of a boon, Bill, to the rest of the world. As a…

O'REILLY: Yes, I mean, they have to buy stuff.

DOBBS: Right.

O'REILLY: There will be a lot of donated stuff, too. But they're going to have to get expertise in there. But the Japanese economy is an insular -- and correct me if I am wrong -- economy. They don't buy a lot of American stuff over there, and in fact we always have problems getting our stuff into Japan and China. So I'm not seeing a big impact on the U.S. economy.

DOBBS: Right. I think that -- I think that's probably correct. Although some of our steel companies will benefit. There is apparently limited insurance company exposure to restoring and replacing that which is damaged in Japan.

O'REILLY: Yes, the Japanese have their own insurance companies.

DOBBS: So, at that level. But an insular economy isn't in this respect and it is a trading economy. They -- they export to the world. And much of the world is dependent on Japanese products.

O'REILLY: All right. Let's go to Wisconsin. Walker says -- the governor of Wisconsin -- says, look, I had to break the union, and he did. Let's -- let's be honest.

DOBBS: He broke it.

O'REILLY: OK, because I had to get costs under control so that I can then rebuild the state's economic picture to the tune of 250,000 jobs. How do you create jobs by breaking the union?

DOBBS: Well, we're going to find out more in his State of the State message, which will be next Tuesday. But what he is alluding to -- and I've talked with -- I have talked with some of the folks there in Madison, Wisconsin -- what he is alluding to is stripping away collective bargaining powers that constrain the ability of government to reduce the size of payrolls and, indeed, reduce wages. He is going to be saving the citizens, so he says…

O'REILLY: Yes, about $3 billion over three or four years.

DOBBS: Well…

O'REILLY: But how does that create jobs?

DOBBS: Well, it saves jobs because they won't have to raise taxes. And that's the point of this. The ability to constrain the size of government…

O'REILLY: Well, he's saying -- he is saying OK, because I got these givebacks and because I broke the union and they are not -- and they're not going to bother me for the next four years, then I -- I don't have to raise taxes, I can maybe cut taxes on some small business owners and what and attract more people into the state from the neighboring state of Illinois, which is jacking up taxes on everybody.

DOBBS: They got a labor force of three million people in Wisconsin. Just about 300,000 people unemployed or just about 7.5 percent unemployment rate. What he is talking about is within the margins of reality.

O'REILLY: Well, he has -- he has 250,000 and he's going to have no unemployment. It's going to be nothing.

DOBBS: But it -- it's an interesting idea. There is an interesting sidebar to this. And that is that the Republicans and this governor are also going to put a limit on property taxes in Wisconsin, which means that the municipalities, county governments will have to follow suit and start reducing payroll.

O'REILLY: Well, it makes it more attractive to live in Wisconsin.

DOBBS: Absolutely.

O'REILLY: If you're living in Illinois and you're getting hammered on every front, all you've got to do is get in the car and drive 30 miles…

DOBBS: Right.

O'REILLY: …and you have a good -- that's why New Hampshire does what it does.

DOBBS: Right.

O'REILLY: And it…

DOBBS: Correct. All one has to do is look at what's happening in New York. Net out migration maybe to Wisconsin.

O'REILLY: President Obama holds a press conference today, oil prices. Obviously, this is killing Obama. He's -- among independents his approval rating is down 10 points in a month.

DOBBS: Right.

O'REILLY: So here's what he says about the oil. Go.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Our oil production reached its highest level in seven years. Oil production from federal waters in the Gulf of Mexico reached an all-time high. For the first time in more than a decade, imports accounted for less than half of what we consumed.

(END VIDEO CLIP)

O'REILLY: I didn't know that.

DOBBS: Well, it's interesting in this little statistical war that is going on now between Republicans and the White House. The fact is that just about half of the rigs in the Gulf have been taken out of service because of what has been a passive-aggressive ban. It's also interesting that this president did not recommend a single policy advance here today at that news conference. And he chose to talk about energy on the second day of declines in crude oil prices since the run-up began.

O'REILLY: All right. But he -- if he is -- what he says is true, we are getting more oil out of the Gulf than we've ever gotten.

DOBBS: Right. Yes, I think, I want to give the president all the credit in the world here because he talked about for the first time in my memory domestic oil production.

O'REILLY: Supply side. Yes, supply side. That's it, right.

DOBBS: Hallelujah. The richest energy country in the world and our president is talking…

O'REILLY: He's still not going to go to ANWR no matter what.

DOBBS: Yes, we just got 90 -- 90 billion barrels of oil up there.

O'REILLY: All right. Lou Dobbs, everybody. Check him out Monday night at 7:00 on Fox Business Channel, a new show "Lou Dobbs Tonight."

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