Worries mount 'tax time bomb' threatens jobs recovery
Can problem be fixed before January deadline?
- Duration 7:49
- Date May 5, 2012
Can problem be fixed before January deadline?
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Only a 1151000.
New jobs in April -- a whole lot weaker than what was expected and not nearly enough to keep up with population growth.
We'll summit Forbes blaming it all on the ticking tax bomb that smoking job creators in less than seven months.
Dozens of tax cuts set to expire is that.
Threatening a jobs recovery -- -- I'm David has been a bucket of Forbes dot box let's go -- just quit.
-- goes Iranian Victoria Barret Elizabeth MacDonald John Candy and -- -- -- Michael Xavier -- Start with you David the potential for tax increases is killing the economy we sort in the -- -- -- this week.
Where what happened was the index came in lower than both a year ago in two years ago we're seeing it in stock prices which based on forward earnings are cheaper than they were a year ago.
That should not be what's happening in a recovery and Rick this is what is smoking the job graders in the private sector that's why they're not hiring.
I actually I would say that sometimes worrying can be a very good thing -- We have a unique opportunity coming in the lame duck session that's gonna come around after the election.
And my sources tell me that the pressure of the bush tax cuts and by the way when I say sources I mean the the trainer over the -- Actually I saw little personal -- does.
-- -- -- congressional sources are telling me there is a real appetite to use this opportunity with people fearing.
The expiration of the tax cuts to use it to actually get something done.
In December to start fixing some of these problems so let's let's hope this pressure stays on I think it could be a very good thing.
Well he MacKey used to cover -- is still cover texts but you were like the expert at the Wall Street -- want taxes and everything -- look at all of the tax cuts that are set to expire it's kind of silly to say they're set to expire because they've been in existence for ten years but.
Dozens of them.
Yeah we've got the lunatic complexity of the tax -- hanging up business hiring in this country.
And when they expire some by -- some also say it would cut two percentage points at a GDP growth.
Mean we're already at 2% GDP growth meaning the economy with flat -- possible double dip.
But the problem with -- DC is that it according to fed.
Official -- Richard Fisher out of Dallas you say you know stop kicking the can over the Fed to do your job congress and job creation.
You know the Fed has already done enough it's tripled its balance he's not a size of Germany and it's got two trillion basically in -- -- you know locked up in the S&P 500.
You gotta get some incentive there to get that -- unlocked to create jobs and Victoria.
Don't think -- if taxes are going up by better I better hold my cash.
That's certainly true I do you know what -- trainer at the gym thing.
Look at how I I would just -- over your sources -- You know -- in all seriousness yes David you're absolutely right incentives do matter and if you're a business owner.
You're clever you're looking at Washington you realize they're spending much more than they're taking in and that means they're gonna have to take in more and that's gonna come right out of your pocket.
And that means you're gonna be hesitant to hire it's quite simple I don't understand why we're making the United States and in hospitable place to do business.
John Candy -- -- jobs figures on Friday were an ambiguous who was actually clear they were bad numbers less than expected.
-- yes unemployment -- down 010110.
Of 1% but that's just because lot of people quit looking for job.
Absolutely and and taxes won't help taxes are a price they -- priced placed on work and -- price placed on investment the price on both the senate to go up and 2013.
But my -- guess is the markets have priced in an extension of these tax cuts already -- certainly president -- certainly president Romney is going to extend them if he's elected.
And as I believe the economy will not improve under -- under President Obama.
President Obama is going to seek an extension of these two I think taxes missed the greater point which is the dollar is what's holding back recovery but.
Rick I've heard the president is already telegraphed that if he is reelected there -- some taxes he's gonna allow the rise including those on the on the top tier.
I think what the president's really doing is setting up the lame -- that that I was talking about earlier what we have an opportunity for real negotiation also.
Let's keep something in mind what we're looking at right now is not just about taxes.
Interesting report out yesterday that shows that that executive compensation is going through the roof.
While workers' wages remained stagnant -- we -- sorry economy.
Where we is -- why can't president had interview here I have a democratic congress he had a chance did to change our library has it happened where.
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- We haven't seen allotted to go -- and every day there is a chance for negotiation if falls apart -- why -- the blame game here.
But if we're relying on negotiation and I think were -- -- -- I got up as optimistic here's my good buddy Rick because the democratic controlled senate hasn't presented a budget in three years all they do is attack -- the Republicans present from the house and the I don't agree with your comments on their President Obama.
The gap between lower income people on the rich has widened that's actually true go ahead a Mac.
You know -- Mexico has a budget crushing.
Like seeing something to cheer about there -- You know here's a deal I mean it's magical thinking to think that you know it's a problem -- CEO pay -- get it you know we don't like median income -- but the issue is -- to get back to prosperity when you have a labor force that it's about the less than half of the entire population with the boomers retiring when the labor force participation rate is at levels of 196919791981.
That's really bad TV more people working to find the entitlement programs a guy.
Wants I saw polite Victoria -- and go ahead Victoria.
Two key -- I I agree with bland and and what's happening here too -- really troubling is we're not seeing small business growth we're not seeing small business is being created and that's I think in part because we have this.
In hospitable environment that we're -- that where they're facing incredibly high taxes.
She doesn't pay the corporate tax hadn't -- small businesses are paying a higher tax rate they are -- -- -- app.
-- -- big corporations have all the lawyers and lobbyists are watching John Gotti now we are not area businesses the heart of the economy but they're the ones -- to going to be hit.
When that top tier tax increase goes down right exactly.
Then they certainly will.
He's a lot of small -- small businesses of course -- paying at the at the individual income tax rate but I think Rick's numbers that he sites just about every week need to be addressed.
Implicit there is from the same people or at the top every year -- people look at that are at the bottom.
And in truth Mark Zuckerberg is about to make twenty billing and IPO.
Ten years ago he was in high school so to assume that graceful -- talk about it it income inequality that's a beautiful thing that -- enterprises being rewarded.
In the US the people the -- or an ever changing team picture.
And -- -- -- that is one of the beauties of the American system whether it's Democrat or Republican who's in charge we do have this flexibility.
People who are who are billionaires one here the next year they're not and you get new billionaires.
Yet that that's kind of that's swell but that we talk about misleading numbers look.
You guys you guys want to blame the president because CEOs are taking all the upside.
And putting it in their -- no instead of anyone you certainly when I -- -- as instead of instead every supporting a workforce where we see their productivity skyrocketing.
I don't understand -- you blend that I'm the president I don't know what are active recovery since 94 what we have now.
Is an economy that's -- -- totally dependent on government borrowing and the Fed printing money and as John pointed out it's done nothing but destroyed that the dollar.
And we have no job all right on that happy note can we get --