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.
JOBS REPORT SPARKING FEARS OF A NEW ECONOMIC SLOWDOWN
Gary B. Smith: The Fed has been putting a lot of cheap money into the economy. That's the good news--it's still sloshing around out there. The bad news is that it gets back to what we led with. The unemployment. The effective unemployment rate is about 15 percent. That has really not budged in the past few months. That's what's holding us back. You have that, an anti-business administration, the highest corporate tax rates in the world and a campaign about taxing the rich even more. Entrepreneurs are not wanting to start up their businesses and corporations are saying they're going to expand overseas. So, all these things together and combating what the Fed is doing. It's almost worse than a recession. I think we're going to muddle through like we did in the 70's and we're going to see a few more years like this.
Tobin Smith: One month doesn't mean anything. If you look at the overall data you have to throw out a lot of stuff. There were anomalies all the way through this number. We had the market down because the Fed decided to tell people who are addicted to Liquidity that maybe they weren't going to be writing checks for the next 25 years. I think that's a good thing, not a bad thing. The point that we're going into a recession says we had negative growth and there is no way. We are continuing to have sustainable growth.
Jonas Max Ferris: The only concern here is that we're already in stimulus mode with the artificially low payroll tax rate, zero percent interest rate and we're not creating that many jobs. That doesn't mean we're in a double dip recession. There's been a lot of money not made in the stock market by people who were predicting a recession in the past couple of years. It's a sluggish recovery. That's not a recession. It can keep stocks where they are. We're not going to have runaway growth. We're really not going to have it when they pull the punch bowl away in a year or two with the taxes and the low interest rate. That doesn't mean we're sliding back into a recession. There is still slow growth. It's going to take a very long time to get to the unemployment rates we had a few years ago before the last recession, but it's not a recession.
Julian Epstein: You have to look at the big picture. The big picture is at the first quarter of this year is the best performance in terms of job creation in the last six years. We've had four million jobs created in the last four years. Remember where we were coming from. When Obama came in 2009 we were losing 800,000 jobs a month. We were at -8 percent GDP. We're now creating somewhere between 100,000 and 200,000 jobs a month and we're around 2 percent GDP. Now it's just the question if you're looking at the glass three-quarters full or one-quarter empty.
Todd Schoenberger: The facts document this alone. In the last six months 70 percent of the new jobs created are of the low income variety (retail, hospitality, leisure). Those are not going to be the jobs to sustain growth. Therefore, if you have negative growth in quarters to come, that means we're headed into a recession. The documentation, the data, everything proves it for us.
DOCTORS TAKE ACTION AS HEALTH CARE LAW FAILS TO ADDRESS EXCESSIVE LAWSUITS
Gary B. Smith: Dealing with the whole problem would open up the health care system to the free market and we're so far away from that it's laughable. Tort reform would help cut costs, but the unfortunate part is that it's been studied. Apart from taxes on a national level, it's been studied in health affairs. It runs about $55 billion in savings. That sounds like a lot, but it's only about 2.4 percent of health care costs. It's a step forward, but it's not a huge step. It's a step we need to take though.
Tobin Smith: We need tort reform. Physicians tell you they do these tests because it's defensive medicine. If you look at Texas or California where they put a limit on tort reform when they looked at the numbers two or three years after those moves the test rates went down. Why? Because the doctors weren't scared. It's a simple fact and to try to cure the problem with regulation as opposed to getting the underlying disease, it doesn't make sense.
Jonas Max Ferris: In a free market you sue doctors and hospitals for screwing up. That is unfortunately what happens in the free market. It does raise costs and it leads to all these tests going on because doctors have to protect themselves. They do the tests so you don't sue them later. If the government stepped in and said you can't sue, there are no liabilities as a doctor, you'd see half as many tests done. There's no question about it. There would be lower health care costs. There are also tests that go on just so they can rack up bills. In this case, if you had tort reform you would have less tests performed. The doctors would come out and say you don't need to do these tests. They are a waste of your time, basically.
Julian Epstein: Doctors are talking about the fee for service system. The fee for service system is like asking a butcher how much meat you want to eat. We spend about 16 percent of our GDP on healthcare -- about $2 trillion -- much higher than European countries. The doctors are saying that as much as 1/3 of those expenditures can be attributable to wasteful, unnecessary procedures because you're building in a system where the physicians in the medical community can keep padding costs in the fee for service system. The bundle payment system is something that's been studied extensively in the medical profession. It's a significant way to cut costs without reducing the quality of care. Tort reform covers part of the problem, not the whole problem.
Todd Schoenberger: This is about power. You're giving the government the ability to restrict what a doctor can do. You want them to have free will when it comes to care. You don't want them to have to itemize costs when they're prescribing health care. That's something you want to stay away from as a doctor. That's what we've always had before. That's what makes our medical system so great. I'm not so sure it's about tort reform because it would have been an issue way back when and it's not. It's about government control.
STATES LOOKING INTO "MILEAGE TAX" AS GAS TAX REVENUE DROPS
Gary B. Smith: We're subsidizing these green cars and because we're subsidizing them we all get higher taxes. These higher taxes go to the inefficient federal government or the inefficient state government. All these roads and bridges could and should be privatized. That's where you get innovations like the HOV lane, which no government could ever come up with. Privatize it instead of giving all this money to the country that creates the big dig and wastes zillions of dollars.
Tobin Smith: Roads and streets need to be paid for. We've taken a system from 1935 and are applying it to 2012. We're smarter than that. So, let's put smart tags on our vehicles and have people who use the roads more pay a little more for their use fee than people who don't use them. You can't make the argument that we can privatize everything.
Jonas Max Ferris: This is a great idea because we don't take in enough income tax to pay for the roads. It's mostly paid for by the gas tax. The problem is asphalt prices keep going up, but the gas tax has stayed the same. The problem is there's a gap. We can either pay for it with general taxes, but that's not fair to the people who are driving. They should have to pay for it through some mix of a gas tax and a mileage tax. I haven't bought a gallon of gas in months because my scooter gets great mileage. So, I'm using all these roads and getting away with it. If you have an electric car you're not paying any gas tax. We have to get on top of this why the technology is growing and get these roads right.
Julian Epstein: We're about $10 billion short. The Bush administration said the interstate highway system and road system creates benefits for every single business and every single sector. The idea of privatizing is not realistic. A private company cannot build a interstate highway system. The idea of a tax right now makes no sense given the fragility of our economy. We have to do what we did last year which is take the shortfall from general revenues because this system is just too important.
Todd Schoenberger: You can't tax us right now. It's impossible. Every government is going to threatening. Bridges are going to falling down. They are going to use the I-35 bridge as their political motivation here.
Gary B. Smith: Google (GOOG) up 15 percent by Labor Day
Tobin Smith: UPS (UPS) up 20 percent by 2013
Jonas Max Ferris: FMC Technologies (FTI) up 25 percent in one year
Todd Schoenberger: Kraft (KFT) up 20 percent by January