What's really behind slowdown in hiring?

Separating economic fact and fiction


This is a rush transcript from "Your World," April 5, 2013. This copy may not be in its final form and may be updated.

ERIC BOLLING, GUEST HOST: The job market taking a major hit. Now, is the media helping Democrats make some major excuses for it?

Welcome, everyone. I'm Eric Bolling, in for Neil Cavuto, and this is "Your World."

Eighty-eight thousand -- 88,000, that is how many jobs were created last month, well below the 200,000 expected, the jobless rate dipping to 7.6 percent, as more than Americans simply stopped looking for work.

The labor force participation rate hitting its lowest level since Jimmy Carter was president. And now this from the Associated Press, saying the weakness may signal some companies are worried about steep government spending, sequestration cuts, AKA, even though the bulk of the cuts have yet to kick in.

Senate Majority Leader Harry Reid also citing the cuts, saying -- quote -- "Only Congress can undo the serious effects of Republicans' harsh austerity," but no mention of the hike in the payroll tax, which is blamed for consumers clamping down on spending, or a Chamber of Commerce study survey finding that the health care law is now the biggest concern of and for employers.

To market watcher right now Craig Smith on separating the fact from the fiction.

Craig, what is it? Is it government spending slowing down because of sequestration? Or is it consumers not spending?

CRAIG SMITH, CEO, SWISS AMERICA: Well, you and I both know what it is, Eric. And this is what is funny.

I watched you talk about it on "The Five" back in December. I have watched Neil talk about it right here on "Your World." I have watched Fox Business anchors -- which, by the way, if you get it, you should demand it -- talk about it, that when you go to raise taxes on the top 2 percent of American people, you are going to lose jobs. And guess what? We're seeing that slowdown right now, Eric.

BOLLING: Right. Let me just jump in here.


SMITH: When you raise taxes on all middle-class Americans with the Social Security tax that had to go up...

BOLLING: Right, that.

SMITH: ... that means less money for people to go out to eat out and so on and so forth.

I was thinking about it for the average $250,000 wage earner. Think about it. He has $10,000 more in taxes this year. There goes the gardener. There goes the maid. And now when -- like, in my own situation in my own company, we lost a person this year to attrition.

We're not replacing that person, Eric, because I don't know what I have to deal with, with ObamaCare. I have to make sure I protect all my other employees because they get private insurance.

So you and I both know what it is.


SMITH: And if it was sequestration -- sequestration was Mr. Obama's idea. So, one way or another, why doesn't this president take credit for what is happening and give us some leadership to turn it around?

BOLLING: Craig, you hit on it earlier in that answer. But it wasn't that 2 percent -- it may have something to do with the 2 percent, the top 2 percent earners getting their taxes raised. It was the payroll taxes. The payroll tax increase hit every American.

It just wasn't the top 2 percent.

SMITH: You bet. Absolutely.

And as I said, that means that, you know, $1,000 average person, now all of a sudden they can't maybe have that night out where they go down to grab a pizza or a movie show. That means that that restaurant owner can't hire more people or maybe even have to lay somebody off.

But, you know, when I saw the statistic today, that I'm sure you saw, Eric, 663,000 people left the work force in March. That now puts it 90 million people have left the work force; 9.4 million people have left the work force since Mr. Obama took over the White House.

If you were to adjust that for population, I could argue that we have the lowest historic rate of working-age people working in America. We can't continue on this path, Eric. We have 0.6 percent GDP. Until we...

BOLLING: Craig, let me jump in here.


SMITH: ... we get growth back, we're not going to get, you know, this thing turned around.

BOLLING: Allow me to jump in here.

If you add those people that keep leaving the work force, if you add them back in, you're talking about 12, 13, maybe even a 14 percent unemployment rate.

SMITH: You bet.

BOLLING: But here's the question. All those people that leave the work force, they're living on the government dole. They're relying on the government. Where is the incentive to get them back to work?

SMITH: Amen.

Look, they get unemployment. Chronic unemployment, by the way, now is 4.6 percent of our work force, 40 -- 40 percent of our work force, 4.6 million people. But you're right. First, you get unemployment for X-amount of weeks. And if it's more than 27 weeks, it's chronic unemployment.

Then, if that runs out, you go on to disability. Last month, we had 82,000 people join the disability ranks. That's now nine million people getting disability. Then you get some welfare if the disability runs out. Then you get food stamps.

Eric, you and I both know, and Neil knows, these numbers don't work, and what is amazing to me is the administration can say -- say it and nobody challenges it. Last night, he said automatic weapons killed those children back East. No, they didn't. Nice to raise three million bucks, but it's not the truth.

BOLLING: He misspoke there. There's no question.


SMITH: You won't lose your doctor. You can try to keep your doctor. Well, we're going to lose the doctor.


SMITH: Your premiums won't go up. My premiums have gone up, Eric.


SMITH: When will somebody hold this man accountable that you can't keep telling -- I don't want to say a lie -- you can't -- you can't keep avoiding the truth and not have it catch up with you sooner or later.

BOLLING: Sure. Sure. All right, Craig, we're going live it there. Thank you very much.

SMITH: Good seeing you, Eric.

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