Why is solving inflation such a partisan issue?
Wall Street Journal's Bill McGurn, Fox News contributor Leslie Marshall and Washington Post's Marc Thiessen discuss economic management amid rising prices.
This is a rush transcript of "Special Report" on November 11, 2021. This copy may not be in its final form and may be updated.
(BEGIN VIDEO CLIP)
JAKE TAPPER, CNN ANCHOR: Do you think that Build Back Better in its current form is essentially dead because of inflation?
RON KLAIN, WHITE HOUSE CHIEF OF STAFF: Quite the opposite, Jake. the Build Back Better bill is the best answer we have to bringing those costs down.
TULSI GABBARD, (D) FORMER HAWAII REPRESENTATIVE: What this bill is going to do is make inflation worse. It's going to increase national debt. It's going to make things harder for our small businesses. And ultimately it's going to make people more dependent on a government that already is encroaching too much in almost every part of our lives.
(END VIDEO CLIP)
BAIER: The White House chief of staff and former congresswoman, Democratic congresswoman Tulsi Gabbard, talking about inflation there. "National Review" had their editors write this about Biden's inflation problem. "We need more truck chassis, but current trade policy creates a combined tariff of over 200 percent on importing them. Labor policy designed in the early 20th century has allowed unions to entrench inefficiency and freeze labor productivity in the transportation sector. Environmental regulations in California have prevented the expansion of port capacity. The federal government has prioritized transitioning away from fossil fuels while begging OPEC to pump more oil. Build Back Better either leaves those problems untouched or exacerbates them. It sees government created problems and prescribes more government as the solution. It won't work."
So why are these experts on two different sides looking at this massive bill seeing completely two different things. Let's bring in our panel, "Washington Post" columnist Marc Thiessen, Leslie Marshall, Democratic strategist, and Bill McGurn, columnist for "The Wall Street Journal." Bill, the inflation thing is so real that everybody acknowledges it now. It's just that how to prevent a going forward is being debated.
BILL MCGURN, COLUMNIST, "THE WALL STREET JOURNAL": Right. And of course, it's not just Republicans. Larry Summers also has worried about it openly, and Joe Manchin worries about it quite rightly. And the reason I think we have this is because we are asked to believe all these fantasies that this won't cost a dime. First, we were told there is no inflation, that it's transitory, it would end in September when people went back. None of these things are turning out.
The political problem for Biden is that you cannot spin inflation. People see it. They feel it when they get a sack of groceries, or they go to the gas pumps. Even my kids, who are not political, see that. And the problem Joe Biden has is that it's going to affect the passage of Build Back Better as a reconciliation bill. And I think also is going to affect the veracity of his claim that he doesn't tax anyone who earns under $400,000. If you have raging inflation, your paycheck is being eroded. And that's why they're call the impact on people at the bottom of the pile the cruelest tax.
So I think there is a big problem. And you ask why people are pursuing this. I think it goes back to the dominate dynamic of this. Progressives that are pushing this are largely in safe seats. Moderates are really Democrats in swing districts worried about winning reelection.
BAIER: Yes. Leslie, we do have this nonpartisan Tax Policy Center saying that they look at Build Back Better and see tax increases for middle-class. And some of it deals with SALT, the state and local taxes and what's in there. But there are two very divergent views of what this legislation as we don't even know what it really is, is going to do.
LESLIE MARSHALL, DEMOCRATIC STRATEGIST: We have that not just because of politics. We also have that, as you can see, Bret, from economists. I can find you 10 economists that say this is bad. I can find you 10, maybe 20 that say it's good. But a woman that I trust greatly is our Treasury Secretary Janet Yellen. She said, look, here is the reality. We've had inflation before in the 80s. We have it now. We will have it into next year.
And the reason for that and we didn't have in the 80s is COVID. Not only are we getting beyond COVID, even though we do still have the virus, we are not in the midst of a pandemic, we have more people going out, we are buying more. That is a good thing. The bad thing is we weren't ready for this. And the suppliers, the manufacturers worldwide, not just here in the United States, weren't ready for this.
We as Americans and as consumers do have a secret weapon, it's called buy American. We wouldn't have clogged ports 30 minutes from me, the largest port in the country, which, by the way, doesn't have the standards that the infrastructure bill will bring it up to that any other ports in the world does with our competitors internationally in this global economy.
So are we in a tough time right now? Absolutely. Will this get better? Yes. Do we need to be a bit more patient? Yes. And I say as one of the most impatient people on the planet.
(LAUGHTER)
BAIER: Marc, the president said the stimulus checks that came out of the COVID financing from Capitol Hill, he said caused some of this inflation problem, conceding that it's only growing, not shrinking.
MARC THIESSEN, COLUMNIST, "WASHINGTON POST": He's right. They pumped, you had $300 billion hole in the economy, and they pumped $1.9 trillion into it with stimulus checks and with child credits, and with the unemployment supplements. And as a result, the personal saving rates in August was $1.7 trillion that Americans were sitting on. So people have lots of money to spend, but they're not in a hurry to get back to work. And so that created this crisis.
What Joe Biden said is exactly Joe Manchin's argument against the stimulus bill that he wants to pass. If $1.9 trillion is driving inflation, imagine what $4 trillion is going to do to the economy. So it's going to raise prices, it's going to overheat the demand side of the economy before the supply can keep up and drive inflation. So he is making Joe Manchin's case for him.
BAIER: Quickly, Bill, there is some pressure, obviously, from progressives who believe that their whole thing about linking the two bills fell apart. They voted on the infrastructure bill, it passed. They're going to have a big signing ceremony next week. But they need to see the other side of this, according to them. Are they going to get the votes?
MCGURN: That's a good question. We'll find out if the moderates hang tough. They didn't really hang tough in the House. We'll find out if Joe Manchin hangs tough. People keep saying he's going to cave, but he's not making statements like someone who is about to cave. So we are going to find out very soon.
It's interesting to me, again, the people telling us not to worry about this and don't worry, inflation is going to go away, they're the same people who didn't predict that we would be where we are right now. They didn't see it coming, assured us it would change, and they were wrong.
BAIER: And listen, it might be more than Senators Manchin and Sinema. There may be other moderates out there both in the Senate and the House who step forward. So we shall see.
OK, panel, stand by, if you would. Up next, the Kyle Rittenhouse trial and what's coming from it.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
KYLE RITTENHOUSE, DEFENDANT: People were saying cranium him and get him, kill him. People were screaming, and I just was trying to get to the police running down the road.
UNIDENTIFIED MALE: And you say I'm trying to get to the police. Why were you trying to get to the police?
RITTENHOUSE: Because I didn't do anything wrong. I defended myself.
DAVID HANCOCK, RITTENHOUSE SPOKESMAN: It is clear that this district attorney's office should never have brought charges. They did without any meaningful investigation.
The candidate for the U.S. presidency himself last year prior to the election called Kyle Rittenhouse a white supremacist. Joe Biden called him a white supremacist. That's appalling.
(END VIDEO CLIP)
BAIER: Well, Kyle Rittenhouse trial, as it's coming to an end here, has been gripping television to watch. The drama inside the courtroom, the interaction between the players.
We're back with our panel for some assessment. Leslie, as you watch this, would do you take away?
MARSHALL: There is so much here. As we said in the last segment, you can have people on one side or another of an issue see and say two different things, and that's exactly what we are seeing with this trial. Rittenhouse himself being brought to the stand as a defendant, very unusual, most so, obviously, in a self-defense case. Do people believe him? And that's going to be important, if the jury buys the emotional pleas that he was making to them. Not everyone does.
In addition to that, prosecution always obviously has the burden of the proof. Some people are saying too many charges and too strong. I don't think that premeditation has been proven yet. I think they are going to come down from first-degree on some of those charges to second-degree and might have to. There are many people out there in the jury of public opinion that thinks he will walk, but at the same time I do think there were a few times when the prosecution asked some very good questions, which is why did you come with 30 rounds of ammunition, why do you need 30 rounds of ammunition to help people?
And of course, each of those individuals who has been killed by him, there are three different situations when we watch the videotape, and we will have to see if the jurists agree with me on that.
BAIER: Yes. Marc, it is interesting to watch people pipe in on this case before it goes to the jury, before it is all decided. Representative Hakeem Jeffries from New York, who we should point out has been talked about in Democratic circles as a possible speaker down the road, "Lock up Kyle Rittenhouse and throw away the key." That's quite something if you're looking to dial down the emotions.
THIESSEN: Yes, it's outrageous, as is what Biden said about him. But look, there was a key moment today when they showed a video of one of the victims setting a dumpster on fire. And they might as well been showing a video of the prosecutor presenting his case, because the case is a dumpster fire. He violated his constitutional rights and scolded by the judge for bringing in the fact that he invoked his First Amendment right to remain silent. He got dressed down in front of the jury repeatedly.
And his star witness testified that Rittenhouse fired in self-defense. So I think the jury should not only acquit, the foreman should look at the prosecutor and say I award you no points and may have God have mercy on your soul. That's how bad it has been.
BAIER: Bill?
MCGURN: I see it slightly different from Leslie. I don't see two side. What's incredible to me is I see the prosecution making the defense side. Who's a persuasive witness that made the prosecution's case? Most of these things have come out by prosecution witnesses who are backing the defendant's story.
So again, I don't like to speculate, I'm not in the courtroom for all of it. But it is really astonishing that most of the witnesses that have been most powerful for Kyle Rittenhouse have been from the prosecution. I think it goes back to the first point, the case should never have been brought. If it were going to be broad, you would think that the prosecutors would talk to their own witnesses a little bit before they got on the stand.
BAIER: We'll follow it all, and we will take it, and when the jury has it and comes up with a decision, you will see it here on FOX. Panel, thanks. Have a great night.
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