This is a rush transcript from "Hannity," April 1, 2011. This copy may not be in its final form and may be updated.
SEAN HANNITY, HOST: The unemployment rate inched down one-tenths of one percent to 8.8 percent this month, according to statistics release by the Labor Department earlier today.
So why does the economy still feel so sluggish? Well, The Wall Street Journal clues us in as to what may be one of the key factors and that is that Uncle Sam is now paying a far more prominent role than ever before.
This op-ed reveals that twice as many people work for the government than in all of manufacturing combined. It reads, quote, "Every state in America today except for two -- Indiana and Wisconsin -- has more government workers on the payroll than people manufacturing industrial goods."
Joining me now with reaction from the Fox Business Network, Nicole Petallides is with us and the host of "The Willis Report," Gerri Willis.
Guys, good to see you. All right. First of all, all right, I'm happy that unemployment rate went down. We are still not creating jobs at a significant rate, number one. Number two, we are not counting millions of people that are underemployed and have stopped looking for work. This is not an honest number.
GERRI WILLIS, HOST, "THE WILLIS REPORT": You know, we have 13.5 million Americans who don't have jobs right now that need to be put back to work. If you factor in the rate as it is described to date, 216,000 people a month, it would take us five years to put those people to work and that is not even counting the people who will enter the workforce during that time period. We are a long way from full employment.
HANNITY: Why the discrepancy, Nicole, when you have Gallup saying it is 10 percent right now, and not 8.8 percent. Why do we have that discrepancy?
NICOLE PETALLIDES, FOX BUSINESS NETWORK ANCHOR: Well, everything appears to be much better than what it really is. What you are seeing is that people who are long-term unemployed, that continues to go up. People who were getting involuntary or part-time jobs --
HANNITY: It's worse than what we think.
PETALLIDES: Yes, exactly. So, it appears like it is better but it really is worse. People have taken jobs that they don't necessarily want. They are taking part-time jobs and wages are not increasing at all. They are actually less than one percent whereas consumer prices are going up 4.6 percent. You are seeing government jobs coming off a little bit. That is some good news I guess. But we would like to see some competitiveness for some of those government jobs, transportation and garbage and that would save states some money as well.
HANNITY: Aren't we supposed -- isn't this unprecedentally bad in terms of a post so-called recession growth period?
PETALLIDES: Oh, yes.
HANNITY: And when I look at all the other factors, I think this really needs to be -- every other key indicator that we look out here, national price of gas has gone up three times, you know, from a week ago.
WILLIS: Doubled since Obama took office, right.
HANNITY: It doubled since Obama took office. We have seen the resurgence of inflation now that is emerged.
HANNITY: And Jay Carney's denied that it's even happening right now.
WILLIS: It's absolutely is happening, look at what's happened with food. Look what's happened with gas. You know, the government says, just look at core inflation, takeout food, takeout gas. But I don't know about you, but I'm paying that every single week or month.
HANNITY: Yes. And you know, what, and by the way, if we add to that, looks like we may be hitting another housing bubble where this is what started this recession in the first place.
PETALLIDES: Housing is stagnant. Housing stagnant. You may see some of these employment numbers that look a little bit better but housing is one thing that certainly -- and this is really what people value right, is their home, but their equity of their home really hasn't improved. On the contrary, the prices of their -- the value of their home has actually gone down. They are not seeing that.
WILLIS: It's worse than stagnant. We are in a double dip now.
HANNITY: In terms of the housing market.
PETALLIDES: Yes. It's really detrimental.
HANNITY: That's right. But wait a minute, if this precipitated what happened the first time with our recession -- look, how many homeowners are now saying, you know, what? I'm so far under water, I'm not going to pay, I'll stay in here rent-free for a year until the police come and throw me out?
WILLIS: A lot of people are saying that, about a quarter of Americans are under water right now with their mortgages. Not everybody takes that view but some people will. Look, Americans are in trouble right now. And it may be that the elites have gotten better, Wall Street is making better money as Nicole can tell you very well, CEOs the best profits they've ever had and pay for CEOs up dramatically, there was a USA Today story today. But when it comes to regular Americans are caught in this vice grip, the value of their homes going down, income stagnant, going nowhere, inflation going up.
HANNITY: And employment opportunities now are not what they used to be. If there is a job opening literally, you know, there is a zillion people out there just on the unemployment lines --
PETALLIDES: Trying to get a job.
HANNITY: -- that are trying to get a job.
PETALLIDES: It is very difficult to get a job and what we talked about was the wages, right? You are making less than what we are seeing with inflation. So, millions of Americans are really being squeezed.
And as far as the government jobs, I mean those -- what we are seeing with the states is that they are having to pay, the money is being made to pay their benefits and for the local and state governments. And if you have some competitiveness, they are free to have competitiveness for these fields, and that would actually save the stated some money.
HANNITY: So, is it possible if we look at all of these metrics combined because the media was going insane today, you know, they are just looking to place an altar in front of the, you know, "The Anointed One" and light candles and say oh, thank goodness, Obama is here, forgetting record debt, record deficit, a second housing bubble, unemployment, unprecedented heights and dishonest numbers. Are we saying then, are you saying that you think economically things in this country are getting dramatically worse and we need to be concerned?
WILLIS: Well, look at this. OK. We have supposedly been in a recovery for almost two years. It's about time for another downturn. I got to tell you, June of 2009 was when the recovery.
HANNITY: Thanks a lot, Gerri.
WILLIS: I know it's bad news --
HANNITY: What other good news do you have on a Friday night?
WILLIS: Consumers typically turn economies around. They haven't been here this time.
WILLIS: We need the consumer to get better.
HANNITY: What does it mean when government has more jobs than manufacturing and industry combined for the country? In other words, aren't they saying we are not producing?
PETALLIDES: Well, that is actually true. I mean, on the one side, we have to be fair and just say, when manufacturing over 25 years, technology has improved. So, people can make more stuff with less, right? But at the same time, you don't want to see more government employees than private sector, right? And that is what we are seeing. That's what our generation -- I mean, are we raising kids to work for the Department of Motor Vehicles and that is what this op-ed piece was saying...
HANNITY: By the way, I met the nicest lady who watches this show that works for the Department of Motor Vehicles.
PETALLIDES: I'm all for it. I'm all for it, Department of Motor Vehicles.
HANNITY: I didn't have to wait long. She was nice.
PETALLIDES: Good benefits, right?
WILLIS: She has a job forever, Sean.
HANNITY: Well, she deserves it. You know, it was the first time I had a good experience at the Department of Motor Vehicles.
PETALLIDES: I did, too.
HANNITY: You did too. All right. You might have had the same lady. She was a big Fox fan and I was appreciative.
All right. Guys, I really appreciate it. And so, your prospects, double dip recession?
WILLIS: It could be.
PETALLIDES: I mean, housing, housing is really a problem. Housing and inflation, those are the two things to watch, housing -- and also the food and inflation for cotton and inflation for gasoline, these are the things that we are going to keep an eye on.
HANNITY: Last word.
WILLIS: Stagflation. I think that is where we are headed. Low growth, high prices. Get your Jimmy Carter sweater on.
HANNITY: Stagflation, that means misery index coming.
HANNITY: All right. Guys, good to see you both, thank you.
PETALLIDES: Thank you.
WILLIS: Thank you.
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