July 25, 2010

SEC. GEITHNER SAYS WE’RE SEEING A MODERATELY PACED RECOVERY

DAVID GREGORY: But, “unusually uncertain,” there’s the prospect of a double dip recession. There are economists who have said you don’t normally see this kind of anemic pace of recovery once a recovery begins.

SECRETARY GEITHNER: I—I think I disagree slightly in the sense that—now remember, this was a recession caused by a set of policies that left us with a $1.3 trillion deficit when the President came into office. An economy that was falling off the cliff. Millions of Americans had already lost their jobs. The recession was a year old at that point. And given that we’ve been living beyond our means as a country, Americans had been borrowing too much—and you had a huge growth in risk taking and leverage in the financial system, what you would expect is a more moderate paced recovery than as typical—and that’s what we’re seeing. But again, you are seeing a recovery. You’re seeing private investment expand again, job growth starting to come back. And that’s very encouraging. And if you look at what private forecasters say about the economy, they see an economy that’s gonna continue to grow, strengthen moderately over the next 18 months or so. And I talked to businesses across the country, and I would say that is the general view, an economy that’s gradually getting better.

‘MOST AMERICANS UNDERSTAND IT’S GONNA TAKE SOME TIME TO HEAL THIS,’ GEITHNER SAYS

SECRETARY GEITHNER: The economy is starting to heal again. You’re seeing growth, manufacturing, private investment recovery, those are encouraging signs. But we’re living still in a lotta challenge till the—‘cause the scars of this crisis ran so deep. And I think most American’s understand it’s gonna take some time to heal this.

SEC. GEITHNER SEES DOUBLE DIP RECESSION AS UNLIKELY

DAVID GREGORY: So just to be precise, you do not believe in the double dip recession, that it will get worse before it gets better?

SECRETARY GEITHNER: No, I don’t. I think the most likely thing is, you see an economy that gradually strengthens—over the next year or two. You see job growth start to come back again. Again, investments expanding, manufacturing get a little stronger, exports better. Those are very encouraging signs. But we got a long way to go still.

SEC. GEITHNER SAYS THERE’S STILL STIMULUS COMING DOWN THE PIPELINE

DAVID GREGORY: So, why not stimulate more? Why not spend more to do something to create more jobs?

SECRETARY GEITHNER: There is a lot of stimulus still in the pipeline. You saw Congress move this week to expand unemployment benefits. The Senate is about to consider a very powerful package of—of tax cuts for small businesses, help small businesses get access to credit, that’s very important. And we think there’s some more things Congress can do to, again, to help reinforce this recovery. But, we’re in a transition, David, from the extraordinary actions the government had to take to break the back of this financial crisis, to an—a recovery led by private demand. That transition is well under way, it’s gonna continue, it’s gonna strengthen.

STIMULUS AID STILL REMAINS, BUT DIALED BACK

DAVID GREGORY: You’re saying that indeed, government should take its foot off the accelerator of stimulus.

SECRETARY GEITHNER: You know, we have already moved very aggressively to unwind and walk back the emergency measures we had to put in place in the financial sector. Those were very effective bringing down the cost of borrowing. We brought a lotta private capital in. So that was the right thing to do then. We dialed those back very quickly. Right now, we still think there’s a good case for the government acting with targeted measures to help small businesses, and help the unemployed, help states keep teachers in the classroom. Those are sensible, good steps. But we have to make this transition to a recovery led by private companies.

SEC. GEITHNER SAYS GOVERNMENT CAN AFFORD TO EXTEND UNEMPLOYMENT BENEFITS

SECRETARY GEITHNER: David, we can afford to do it this way [extending unemployment benefits], I’m completely confident we can. And if you look again at what we’re paying to borrow now, we’ve got very low interest rates as a country, in part because people around the world, and Americans have a lotta confidence in our capacity as a country to make sure we manage to do so.

U.S. CAN AFFORD TO EXTEND TAX CUTS TO MAJORITY OF AMERICANS, SEC. GEITHNER SAYS

SECRETARY GEITHNER: Again, we are proposing to make sure we’re extending tax cuts that go to 95 percent of Americans. We extend a bunch of tax incentives to businesses to help encourage hiring investment. We think those are sensible, affordable steps. We can—we can afford to do that now. But we have to make some choices too, and we have to make sure we can continue to earn confidence around the world that we’re gonna have the will as a country to bring these large inherited deficits down over time to a much more manageable level.

SEC. GEITHNER SAYS LETTING THE BUSH TAX CUTS EXPIRE IS ‘FAIR AND GOOD POLICY’

DAVID GREGORY: Even democrats, and the Chairman of the Budget Committee says, “Bad idea to raise taxes on wealthy Americans—until you’ve got a recovery on sounder footing.” Any wiggle room on that—any—

SECRETARY GEITHNER: … I don’t think that’s quite a fair description of Senator Conrad’s views. But I won’t speak to them. But I’ll say what the President believes, and I believe this is, the right thing—thing for the country, the fair thing, the responsible thing for the country now, is to make sure we leave in place and preserve tax cuts that go to more than 95 percent of working Americans and compliment those with a set of incentives for businesses to expand and hire. To make that possible, and to do that responsibly, I think it is fair and good policy to allow those tax cuts that only go to two—two to three percent of the highest earners in the country, to expire as scheduled. The country can withstand that, the economy can withstand that, and I think it’s good policy.

OBAMA’S ‘MODEST LEVEL’ OF GOVERNMENT COMPARABLE TO THAT OF PRESIDENT REAGAN’S, SEC. GEITHNER SAYS

DAVID GREGORY: If deficits are unsustainable, can you give an example yet of a painful choice that the President’s prepared to make to bring our fiscal house in order?

SECRETARY GEITHNER: Well—absolutely. I mean, again, he’s proposed to freeze discretionary spending, to keep the overall size of the government at a very modest level as a share of our economy. If you look again at what the President’s proposing, he keeps the overall size of government at a very modest level, comparable to, lower than was in the Bush Administration, comparable to what President Reagan presided over.

SEC. GEITHNER SAYS TRAUMA OF ECONOMIC CRISIS WILL BE ‘PROFOUND AND LONG LASTING’

DAVID GREGORY: But hasn’t the world fundamentally changed, and the markets that you simply cannot expect to get the kind of return on investment that you’ve enjoyed and so many Americans have enjoyed for so many years?

SECRETARY GEITHNER: I think it’s hard to know. What you want people doing is making better decisions, more careful decisions about how much of their income they spend, how much of their income they save. What they use those savings for, how much they borrow. And I think the trauma caused by this crisis is gonna be profound and long lasting. And you’re already seeing it induce, I think ultimately healthy, and necessary change in behavior, because people are already saving more of their income. And I think that’s gonna be a good thing for the country.

SEC. GEITHNER TO PUSH FOR CAPITOL GAINS TAX TO BE SET AT 20 PERCENT

DAVID GREGORY: Would you like to see the capital gains tax stay at 20 percent?

SECRETARY GEITHNER: I would.

DAVID GREGORY: And so you’ll push for that?

SECRETARY GEITHNER: Yeah, and—and we don’t wanna see the rate of dividends—exceed that either, because again, we wanna make sure we have policies in place overall, across the economy that’s going to make sure we’re encouraging investment, encouraging growth as this economy recovers.

MORIAL: ‘MR. BREITBART THREW A FIRECRACKER IN A CROWDED ROOM’

MARC MORIAL: If we take the proper positive steps coming out of this experience, we can be better off. There are three things I observed. One, don’t forget that this—started when Mr. Breitbart threw a firecracker in a crowded room…He threw a firecracker in a crowded room. He yelled “fire” in a crowded theater. And doctored a video which caused an innocent—hardworking, responsible woman whose story was a racal—racial reconciliation, to be cast in a negative light. And then it began from there. So, that’s certainly an important takeaway.

DUNN ON SHERROD INCIDENT: ‘HOW IS THIS SUDDENLY BARACK OBAMA’S PROBLEM?’

ANITA DUNN: But I think there are a couple of things here. One is that this extraordinary screw up happened and it was bad. The White House and Vilsack moved quite quickly to fix it. And I think that’s what people need to do when they make mistakes. I think that the broader question, though, which is, you know, how is this suddenly Barack Obama’s problem? He has written an entire book about race. In his book Audacity of Hope, he devotes an entire chapter. He made the speech in 2008.

RICK SANTELLI DEFENDS TEA PARTY REGARDING RACE

RICK SANTELLI: First of all, we should have zero tolerance for racial discrimination. Period. Beyond that, if the indirect question is, “Is the Tea Party racist?” I think the real question is, “Are the racists in the Tea Party?” And I would contend that statistically there’s going to be racists in any group. I think the Tea Party is more a thought, more a feeling, more a philosophy than it is a party…. And if you connect the dots, ultimately, what we are—the Tea Party seems to represent is a movement that we can control spending and we can have good strategies without negatively impacting minorities which might be higher proportion of some of these programs that get affected by spending.

MORIAL SAYS PRESIDENT WOULD BENEFIT FROM CIRCLE OF RACE ADVISERS

MARC MORIAL: The President would benefit by a broad circle of external advisers and maybe some internal advisors who have the experience, particularly in the South—the contemporary experience of the Civil Rights Movement—that could serve as a sounding board. And I think that this President would benefit and every president would benefit by having those type of people—those experiences in his circle of advisors.

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WEB LINKS FROM TODAY’S “MEET THE PRESS”

Geithner confident of avoiding double-dip recession

http://bit.ly/b2uXd6

Geithner: Job growth will ‘gradually’ get better

http://bit.ly/aWMsLE

Fighting a lost war on financial reform?

http://bit.ly/cIgTWz

Geithner on preserving affordable housing

http://bit.ly/clgCFY

‘Economy can withstand’ expiration of Bush tax cuts

http://bit.ly/bw2kEy

What does Sherrod saga say about politics of race?

http://bit.ly/caB0hc

Panel addresses economy, Bush tax cuts

http://bit.ly/c8uYiP

Morial: Rangel has ‘right to be heard’

http://bit.ly/aIBVBY

# # #

Below is a RUSH transcript of this morning’s broadcast (7/25/10), mandatory attribution to NBC News’ “Meet the Press with David Gregory.” A final transcript of the program is available at: www.mtp.msnbc.com

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DAVID GREGORY:

Mr. Secretary, welcome back to the program. Thank you for having us down to your office.

SECRETARY GEITHNER:

Good to see your, David.

DAVID GREGORY:

I wanna ask you about some of the broader economic—outlooks that we’ve heard across the the spectrum this week. An important one from the Fed Chairman—Bernanke who said this week that the outlook is “unusually uncertain.” And I wonder if to you, to the President, that means you fear that things are gonna get worse before they get better?

SECRETARY GEITHNER:

I don’t think there’s anything unusual about the fact that given the severity of this crisis, this recession, given how bad it was just 18 months ago, that Americans are still living with—some caution, some sense of caution about their future. I think that’s natural, unavoidable. But you know, the economy’s now been growin’ for almost a year, a little more than a year, private sector’s creating jobs again. The economy is starting to heal again. You’re seeing growth, manufacturing, private investment recovery, those are encouraging signs. But we’re living still in a lotta challenge till the—‘cause the scars of this crisis ran so deep. And I think most American’s understand it’s gonna take some time to heal this.

DAVID GREGORY:

But, “unusually uncertain,” there’s the prospect of a double dip recession. There are economists who have said you don’t normally see this kind of anemic pace of recovery once a recovery begins.

SECRETARY GEITHNER:

I—I think I disagree slightly in the sense that—now remember, this was a recession caused by a set of policies that left us with a $1.3 trillion deficit when the President came into office. An economy that was falling off the cliff. Millions of Americans had already lost their jobs. The recession was a year old at that point. And given that we’ve been living beyond our means as a country, Americans had been borrowing too much—and you had a huge growth in risk taking and leverage in the financial system, what you would expect is a more moderate paced recovery than as typical—and that’s what we’re seeing. But again, you are seeing a recovery. You’re seeing private investment expand again, job growth starting to come back. And that’s very encouraging. And if you look at what private forecasters say about the economy, they see an economy that’s gonna continue to grow, strengthen moderately over the next 18 months or so. And I talked to businesses across the country, and I would say that is the general view, an economy that’s gradually getting better.

DAVID GREGORY:

So just to be precise, you do not believe in the double dip recession, that it will get worse before it gets better?

SECRETARY GEITHNER:

No, I don’t. I think the most likely thing is, you see an economy that gradually strengthens—over the next year or two. You see job growth start to come back again. Again, investments expanding, manufacturing get a little stronger, exports better. Those are very encouraging signs. But we got a long way to go still.

DAVID GREGORY:

You see this magazine, I have The Week and—and the headline is, “Where are the jobs? The recession is over, but no one is hiring.” Why is particularly private sector hiring apparently so slow?

SECRETARY GEITHNER:

They’re—I think businesses across the country, you know, again, faced with the prospect of an economy falling off the cliff, are still cautious, still very cautious. So they’ve been trying to get as much productivity out of their employees as possible. They’re in a very strong financial conditions—though, and I think that’s very promising. Because there are a lot of pent-up demand, and there’s a lotta capacity still for them to step up and start to invest and hire again. But you’re seeing it start—you know, we’ve had six months of private sector job growth. Not as fast as we l—like, not as fast as we need. But I think you’re gonna see it, again, gradually start to get better.

DAVID GREGORY:

But why—why are businesses uncertain? Is it what’s happened in Europe and Greece and—and other places? I mean—in other words, businesses are making money, they’ve got cash, but they don’t—

SECRETARY GEITHNER:

Yeah. They are.

DAVID GREGORY:

•           seem to wanna invest it.

SECRETARY GEITHNER:

Again, the most important cause, I think, is the scars caused by the depth of the crisis, what that did to confidence. You’re right, though, to mention Europe. You know, when people got very worried about Europe in the spring, it did hurt confidence. You saw equity prices fall around the world, and that—that absolutely had an effect. That increased a little more caution. But that, I believe, is a temporary factor. Europe’s moved very aggressively. And they’re starting to get more confidence back in Europe, that they—they have some tractional policies and they’re gonna be able to put this behind ‘em.

DAVID GREGORY:

But you still have—both the—the political and the economic reality of this headline. Where are the jobs? And—the both political and economic reality is that most Americans, based on—a variety of polling, do not believe the administration’s claim that the stimulus has made things better—rather than left things largely unchanged. And the criticism is, primarily from the left, that the stimulus was never big enough to really match up to the severity of the crisis. So, why not stimulate more? Why not spend more to do something to create more jobs?

SECRETARY GEITHNER:

There is a lot of stimulus still in the pipeline. You saw Congress move this week to expand unemployment benefits. The Senate is about to consider a very powerful package of—of tax cuts for small businesses, help small businesses get access to credit, that’s very important. And we think there’s some more things Congress can do to, again, to help reinforce this recovery. But, we’re in a transition, David, from the extraordinary actions the government had to take to break the back of this financial crisis, to an—a recovery led by private demand. That transition is well under way, it’s gonna continue, it’s gonna strengthen.

DAVID GREGORY:

So you’re not prepared to say that more public works government spending is necessary?

SECRETARY GEITHNER:

We got a lotta challenges left—left in the country still ahead of us. We have very high rates of unemployment, very high levels of long term unemployed. We wanna make sure we’re strengthening the competitiveness of American companies across industries. And we’ve got some long term fiscal problems, they’re gonna be a challenge for the rest of the country. And we’re gonna work to fix those problems we inherited, but the best way to do that is to make sure we’re growing, private investment starts to come back, private firms start to hire again, the government can help, but we need to make this transition now to a recovery led by private investment.

DAVID GREGORY:

And that’s an important statement.

SECRETARY GEITHNER:

It is.

DAVID GREGORY:

You’re saying that indeed, government should take its foot off the accelerator of stimulus.

SECRETARY GEITHNER:

You know, we have already moved very aggressively to unwind and walk back the emergency measures we had to put in place in the financial sector. Those were very effective bringing down the cost of borrowing. We brought a lotta private capital in. So that was the right thing to do then. We dialed those back very quickly. Right now, we still think there’s a good case for the government acting with targeted measures to help small businesses, and help the unemployed, help states keep teachers in the classroom. Those are sensible, good steps. But we have to make this transition to a recovery led by private companies.

DAVID GREGORY:

You talked about extending benefits to the unemployed. When the President did that back in November of last year, he trumpeted the fact that it was paid for, that it wouldn’t add to the deficit. And yet, the complaint from Republicans this time is no such promise here, this will add to the deficit. Why was it important then to make sure it was paid for, but not now?

SECRETARY GEITHNER:

I think this is the responsible way to do it. You know, my job, David, is to help make sure we can borrow to finance the obligations that Congress gives us. And I think it’s a prudent, responsible way, given the scale of the emergency, the scale of the damage still facing America, that we finance these additional support for the unemployed, as well as the support for small business. We think there’s a good case for doing it now. We wanna do it in an overall, fiscally responsible way. And as you know, the President has proposed a series of measures that will cut our deficits in half over the next several years. That’s important too for future growth. We’re gonna make sure we get that balance right.

DAVID GREGORY:

But again, it was important to be paid for then, but not now?

SECRETARY GEITHNER:

David, we can afford to do it this way, I’m completely confident we can. And if you look again at what we’re paying to borrow now, we’ve got very low interest rates as a country, in part because people around the world, and Americans have a lotta confidence in our capacity as a country to make sure we manage to do so.

DAVID GREGORY:

Indeed, that’s the argument that is sided by those to say that government should spend more, because the cost of borrowing right now, there’s all this debate about stimulus versus the debt. A lotta people saying government spending is out of control, but you just made the point. It doesn’t cost a lot to carry the debt right now. Why not spend more to create jobs when they don’t appear to be materializing from the private sector?

SECRETARY GEITHNER:

It’s a difficult balance. Again, we are proposing to make sure we’re extending tax cuts that go to 95 percent of Americans. We extend a bunch of tax incentives to businesses to help encourage hiring investment. We think those are sensible, affordable steps. We can—we can afford to do that now. But we have to make some choices too, and we have to make sure we can continue to earn confidence around the world that we’re gonna have the will as a country to bring these large inherited deficits down over time to a much more manageable level.

DAVID GREGORY:

Let me talk about the achievement of financial reform legislation that you’ve worked so hard on. The—the pay czar Ken Feinberg has been working on—compensation, just issued a new report saying that at the height of the crisis, you had some of the biggest banks paying bonuses that were not warranted. Do you have any way to get any of that money back?

SECRETARY GEITHNER:

You know, he spoke to that earlier. Congress did not give him the authority to do that, but they did give him authority he used very effectively, to change how Wall Street was paying its executives. And he did an enormously important job in trying to make sure that we have in place—ways to make sure these guys don’t go back in the future—don’t go in the future back to paying executives to take risks that could imperil the stability of the economy. He did a great job, limited authority, but he used that authority very well.

DAVID GREGORY:

The—the issue is, are we fighting a lost war on financial reform? To what extent do you look at this regime of new regulation and say, “Well, there’s still a wait and see aspect to this, in terms of whether it can really do the job the next time.” Because we don’t know what the next time’s gonna look like.

SECRETARY GEITHNER:

We don’t. And that—that’s the basic strategy that is reflected in this bill. The best way to make sure we’re protecting a financial system from future crises, we won’t know the source, we won’t be able to anticipate, preempt all those crises, is to make sure the system runs with much thicker shock absorbers, much larger cushions, financial resources against loss, much stronger capital buffers so that they can withstand the kinda shock losses you’ve faced in a recession like this. That’s the most effective thing you can do. And the—this reform bill gives the government authority it did not have to make sure the system runs with these much more conservative constraints on risk taking.

DAVID GREGORY:

As someone who’s concerned about the overall growth of the economy, the role of education, innovation, manufacturing, does it trouble you that 25 percent of our economy is the financial sector, which doesn’t actually make anything besides money?

SECRETARY GEITHNER:

I don’t know what—how large the system’s gonna be in the future. You can’t really tell. But what we’re determined to do, and what the reforms will do is to make sure this system goes back to its core purpose, of taking the savings of Americans and from investors around the world, and allocating those to people with an idea. Not just the largest companies in the country, but to small businesses with an idea and a plan for growing. That’s what systems have to do well. Our system, at its best, was the model for the world in doing that. And these reforms will make sure we preserve that basic strength.

DAVID GREGORY:

A couple questions about—housing and taxes. The housing market is still in a lotta trouble. It’s propped up with mortgage modification, with the—the tax benefits of buying a new home. That’s now gone, home sales have gone back down. Modifications have not worked, it still has not met the goal of—avoiding four million foreclosures. I’m curious to know whether the President and you are committed—to three critical areas. The tax credit for mortgage interest—the credit provided by Fannie Mae and Freddie Mac, and the housing goals, particular for low income Americans. Are you still committed to those three pillars?

SECRETARY GEITHNER:

I’ll say the two things that guide us going forward now. One is, we wanna make sure that we do what is necessary to make sure Americans have the ability to borrow, to finance the purchase of a house. And we bring stability to house prices, we help repair the huge damage done by the housing market. And you’re s—you still see, it’s still in a lot of distress. But we brought a measure of stability to house prices, interest rates have come down dramatically, millions of Americans have been able to refinance, take advantage of lower rates, which is much more money in their pockets. And we’ve put in place a very carefully designed mortgage modification program to help people who have a chance to stay in their house—take advantage of that chance. Now, we’re gonna make sure we continue to do what’s necessary to, again, repair the damage of this housing crisis. But, we have to reform the system. We have to bring to Fannie and Freddie, to the GFC’s, and to the broader housing finance market a better set of policies that make sure we can deliver affordable finance for housing without leaving the economy vulnerable to this kinda crisis.

DAVID GREGORY:

But the housing goals, because that’s a big part of what Fannie and Freddie were doing, of course. Again, they—they guaranteed most of the debt, the mortgage debt that’s out there in the country.

SECRETARY GEITHNER:

They do.

DAVID GREGORY:

And the government has now taken them over, and they were private—heretofore. But is it a goal of getting people into homes, is that still the goal? Because that’s part of the problem, right? You had too many people in homes that couldn’t afford to be there.

SECRETARY GEITHNER:

David—we’re gonna take a careful look at a set of reforms that are gonna be good for the country going forward. And don’t leave us vulnerable to this kinda crisis in the future. I personally believe that there’s gonna be a good case for the government preserving some type of guarantee to make sure that people have the ability to borrow to finance a house, even in a very damaging recession. I think there’s gonna be a good case for that.

DAVID GREGORY:

So Fannie and Freddie should not be dismantled?

SECRETARY GEITHNER:

No that’s—that’s different. I think—we’re not gonna preserve Fannie and Freddie in—anything like the current form. We’re gonna have to bring fundamental change to that market. But, I think there’s gonna be a good case for taking a look at a preserving or putting in place a carefully designed guarantee so again, homeowners have the ability to borrow, to finance a home even in a very difficult recession. But, we’re also have to take a look at the broad set of policies we’ve put in place to help encourage homeownership and particularly help low income Americans—get access to affordable housing. We’re gonna take a very broad look at how to best to do that, we’re gonna begin that process very quickly, consult broadly. And I think that there’s gonna be very broad support among Republicans and Democrats for a set of sensible reforms to fix this system.

DAVID GREGORY:

Let me go through this quickly as I can, some of the big tax issues. The Bush tax cuts set to expire, the administration’s plan is, let them expire, in other words, raise taxes on wealthy Americans above $250,000, but don’t—let them expire, keep ‘em goin’ for those $250,000-- or less. Even democrats, and the Chairman of the Budget Committee says, “Bad idea to raise taxes on wealthy Americans—until you’ve got a recovery on sounder footing.” Any wiggle room on that—any—

SECRETARY GEITHNER:

I don’t—I don’t—

DAVID GREGORY:

•            prospect of change?

SECRETARY GEITHNER:

•           I don’t think that’s quite a fair description of Senator Conrad’s views. But I won’t speak to them. But I’ll say what the President believes, and I believe this is, the right thing—thing for the country, the fair thing, the responsible thing for the country now, is to make sure we leave in place and preserve tax cuts that go to more than 95 percent of working Americans and compliment those with a set of incentives for businesses to expand and hire.

To make that possible, and to do that responsibly, I think it is fair and good policy to allow those tax cuts that only go to two—two to three percent of the highest earners in the country, to expire as scheduled. The country can withstand that, the economy can withstand that, and I think it’s good policy.

DAVID GREGORY:

Would you like to see the capital gains tax stay at 20 percent?

SECRETARY GEITHNER:

I would.

DAVID GREGORY:

And so you’ll push for that?

SECRETARY GEITHNER:

Yeah, and—and we don’t wanna see the rate of dividends—exceed that either, because again, we wanna make sure we have policies in place overall, across the economy that’s going to make sure we’re encouraging investment, encouraging growth as this economy recovers.

DAVID GREGORY:

If deficits are unsustainable, can you give an example yet of a painful choice that the President’s prepared to make to bring our fiscal house in order?

SECRETARY GEITHNER:

Well—absolutely. I mean, again, he’s proposed to freeze discretionary spending, to keep the overall size of the government at a very modest level as a share of our economy. If you look again at what the President’s proposing, he keeps the overall size of government at a very modest level, comparable to, lower than was in the Bush Administration, comparable to what President Reagan presided over.That’s very important. That is a difficult thing to do when we face so many challenges as a country. But, he’s also proposing, as you—as you said, David, to allow these tax cuts for the highest earners to expire on schedule. He’s proposed to reinstate a bunch of disciplines that helped produce the large surpluses of the Clinton era. Now, and those—those policies will bring our deficits down by more than half over the next several years.

DAVID GREGORY:

Final question, the President talked about the fact that, like a lot of Americans who are saving for their kids’ education, his 529, or college savings plan for his daughters has gone down in value. A lot of people think about it—

SECRETARY GEITHNER:

Well, it’s come up dramatically—

DAVID GREGORY:

Come up dramatically, all right but it’s still—

SECRETARY GEITHNER:

•           from his first few months in office.

DAVID GREGORY:

Okay, (LAUGH) but this is a serious point, because a lotta people think about this—and about investing in the market for the future—as you passed a financial regulation. What is a fair expectation for Americans to have out of the capital markets if they see that as a place for savings, when for so many years we heard, “Hey, you’ll get 10 to 15 percent returns over the long term.” Is that what Americans can really expect?

SECRETARY GEITHNER:

I think what they can expect from these reforms is much more accessible, much more simple, much clearer disclosure, about the terms in which they can borrow to finance—education for their children, borrow to finance a home, borrow to finance a car, to get a credit card. Much more clear, transparent, simple disclosure than they had over the past several decades. And much better information about the risks you take in investing. That’s a sensible thing for the government to do. Now of course, you need people to be able to make responsible decisions. We can’t make those decisions for those individuals. They gotta take that responsibility themselves.

DAVID GREGORY:

But hasn’t the world fundamentally changed, and the markets that you simply cannot expect to get the kind of return on investment that you’ve enjoyed and so many Americans have enjoyed for so many years?

SECRETARY GEITHNER:

I think it’s hard to know. What you want people doing is making better decisions, more careful decisions about how much of their income they spend, how much of their income they save. What they use those savings for, how much they borrow. And I think the trauma caused by this crisis is gonna be profound and long lasting. And you’re already seeing it induce, I think ultimately healthy, and necessary change in behavior, because people are already saving more of their income. And I think that’s gonna be a good thing for the country.

DAVID GREGORY:

Secretary Geithner, thank you.

SECRETARY GEITHNER:

Nice to see you, David.

--

DAVID GREGORY:

I’m gonna pose that question to the roundtable. Joining me now to discuss all the angles of this, as well as the entire political landscape, as well, former Obama White House Advisor, Anita Dunn, CNBC’s Rick Santelli, the National Urban League’s Marc Morial, the Washington Post’s E.J. Dionne, and David Brooks of the New York Times. Welcome to all of you. Marc Morial, this was—as—as the conversation about race always is, it became emotional, politically charged, and it happened in a heartbeat. So, to you my question, are we better off for this experience? Are we having a constructive conversation about race in America?

MARC MORIAL:

If we take the proper positive steps coming out of this experience, we can be better off. There are three things I observed. One, don’t forget that this—started when Mr. Breitbart threw a firecracker in a crowded room.

DAVID GREGORY:

This is the conservative blogger, Andrew Breitbart.

MARC MORIAL:

He threw a firecracker in a crowded room. He yelled “fire” in a crowded theater. And doctored a video which caused an innocent—hardworking, responsible woman whose story was of racial—racial reconciliation, to be cast in a negative light. And then it began from there. So, that’s certainly an important takeaway.

The second important takeaway is the story of Shirley Sherrod and the Spooners. And that is a story of reconciliation. It’s a story of people—who came to respect each other. It’s a woman who was willing to admit—that she had some animus and that she worked to overcome it.

And the third thing I’d say—David, is this week in Washington—the Urban League’s gonna have 10,000 people here for our centennial conference. We’re gonna have a constructive discussion about race and education, race and jobs, race and health care. A constructive discussion. And I’d invite people to follow that discussion this week.

DAVID GREGORY:

And the President will be speaking there, correct?

MARC MORIAL:

The President will be there. Secretary Duncan will be there. We have Tim Kaine and Michael Steele. We’ve got business leaders. We’ve got a bit of a mix across the spectrum who’ll be there—to talk positively about the pressing issues that face the country.

DAVID GREGORY:

Anita Dunn, you worked in the White House as an advisor on communications matters. And I want to get your response to Maureen Dowd’s column in the New York Times this morning, because she’s got some sharp words quoting the African American Congressman—James Clyburn of South Carolina. I’ll put a portion up—on the screen. “’I don’t think a single Black person was consulted before Shirley Sherrod was fired. I mean, come on,’ said Congressman Clyburn of South Carolina. ‘The President’s getting hurt real bad,’ Clyburn told me. ‘He needs some Black people around him.’

“He said Obama’s inner circle keeps screwing up on race. ‘Some people over there are not sensitive at all about race. They really feel that the extent to which he allows himself to talk about race would tend to pigeonhole him or cost him support, when a lot of people saw his election as a way to get the idea behind us. I don’t think people elected him disengage on race. Just the opposite. The President shouldn’t give Sherrod her old job back. He should give her a new job, Director of Black Outreach. The White House needs one.’” Those are strong words.

ANITA DUNN:

Those are strong words, David. I think that there are a lot of people who look back at the last week and wish they had behaved very differently. I think there are plenty of people in the news media who wish that they had stopped and thought of the fundamental job of journalism before they started asking for reaction to something that wasn’t there—based on their original reporting.

I think that the NAACP wishes that they had not moved as quickly as they did. And I don’t think anybody is saying that the NAACP, you know, needs more African Americans. And heaven knows that Tom Vilsack who has taken responsibility and who has said how badly he screwed up. And the White House, which knows how badly they screwed up, have moved.

But I think there are a couple of things here. One is that this extraordinary screw up happened and it was bad. The White House and Vilsack moved quite quickly to fix it. And I think that’s what people need to do when they make mistakes. I think that the broader question, though, which is, you know, how is this suddenly Barack Obama’s problem? He has written an entire book about race. In his book Audacity of Hope, he devotes an entire chapter. He made the speech in 2008. He has publicly spoken more to this issue—and talked more about this issue.

DAVID GREGORY:

But there’s a—skittishness.

(OVERTALK)

DAVID GREGORY:

•           getting at is a skittishness about really confronting problems when they are—you know, when they spring up like this. However—whether there were screw ups made, to deal with them head on.

ANITA DUNN:

You know, David, it’s funny to me, because I think so much of this resulted from what was kind of a false meta-narrative that was developing last week. As you recall, I mean, you know, you talked about context and the President’s talked about context. The context for this was not just that Andrew Breitbart decided to edit—to put an edited video to make a point. He was trying to make the point that the NAACP is a racist organization.

So, let’s start with that kind of fun—fun box here. Then the week before that, the NAACP had had a resolution, okay, that called on the Tea Party movement to expel from it most anybody who harbored racist sentiments. The Tea Party Movement came back and said, “That makes the NAACP racist. They’re being racist—so—“

DAVID GREGORY:

All right. And this is a broader context.

ANITA DUNN:

This is the broader context, okay.

DAVID GREGORY:

Let me bring you into this, E.J., because you wrote in a column this week, “Yet the Obama Team was reacting to a reality, the bludgeoning of mainstream journalism into looking timorously over its right shoulder and believing that balance demands taking seriously whatever sludge the far right is pumping into the political waters.” What do we take from this?

E.J. DIONNE:

Well—yeah, that’s my column tomorrow in the Post. I mean, first of all, you asked right at the beginning a good question. Can we have a good discussion on race? We can’t have a good discussion on race if the facts don’t matter. And I think it’s—it’s not only that Shirley Sherrod was smeared. It was a perverse smear. Because if you look at that speech, what she was giving is a speech about racial reconciliation. She was saying poor Blacks and poor White have a lot in common. And this was twisted into—an allegation, false allegation which she was somehow a Black racist.

Now, what’s going on here? I think the traditional media are so afraid of being called “liberal,” god forbid they be called liberal—that they are willing to run with any kind of right wing propaganda and treat it as news. Challenging propaganda or not running it or taking your time before you run with a story, that’s not liberalism, that’s journalism. And I think that the right has been running this campaign for 30 years. They’ve had a lot of success. And we should worry about it. Whether you go and look over both shoulders. And you gotta look at the facts.

DAVID BROOKS:

There’s not only a right wing squabble media, I mean, there’s a squabble culture out there. There’s regular media. We were trained in one media. When I started working in Chicago, we were given a phrase. “If your mother tells you she loves you, check it out.” (LAUGH) And so, that’s it. That—you would never run an excerpt from—a speech, unless you saw the speech. That’s just unthinkable.

So, we were trained in a certain way. A different sort of media squabble culture has come up on the left and the right, which—which decides there gonna – they build audience by destroying other people. They don’t know anything about policy. They don’t care about government. They just want that squabble. And my—my rule is—I mean, for something Anita was doing, stay away from the squabble culture. Don’t get in there. And that’s true for us. And I would say that’s—

ANITA DUNN:

Let me just say something really quickly. That is easier said than done, when the White House Press Secretary walks into the room, and the only question people want to ask is, “How are you gonna react? What are you gonna do? What are you gonna do? What are you gonna do?” And you have a false—a false fact—an edited speech as—as E.J. said, that was designed to create this outcome that becomes quote “the news of the day.” Okay?

DAVID BROOKS:

Well then play by different rules, maybe before firing somebody, call them up and talk to them.

ANITA DUNN:

I couldn’t agree with you more there, ok?

DAVID GREGORY:

Rick Santelli, I want to bring you into this—as—as well. And because there’s a political dimension to this. You know, the NAACP making the charge against the—you know, the Tea Party. The Tea Party in some ways responding in kind by going after Sherrod. Eugene Robinson wrote this in his column—which was provocative.

“With the Obama Presidency some—has come a flurry of charges from the likes of Andrew Brightbart, but also from more substantial conservative figures about alleged incidences of racial discrimination against Whites by Blacks and other minorities.

“These allegations of anti-White racism are being deliberately hyped and exaggerated, because they are designed to make Whites fearful. It won’t work with most people, of course. But it works with some. Enough, perhaps, to help erode Obama’s political standing and damage his party’s prospects at the polls. This is a political strategy.”

RICK SANTELLI:

First of all, we should have zero tolerance for racial discrimination. Period. Beyond that, if the indirect question is, “Is the Tea Party racist?” I think the real question is, “Are the racists in the Tea Party?” And I would contend that statistically there’s going to be racists in any group. I think the Tea Party is more a thought, more a feeling, more a philosophy than it is a party.

And I think in February of ‘09, when I was the lightning rod for this movement in many ways, many different diverse groups of people, from all walks of life, all races, all from different areas of the socioeconomic spectrum, all intersect in an area that’s philosophical. And I think the issue is fiscal responsibility. But with that, there’s a less spending issue. Less spending affects entitlements.

And if you connect the dots, ultimately, what we are—the Tea Party seems to represent is a movement that we can control spending and we can have good strategies without negatively impacting minorities which might be a higher proportion of some of these programs that get affected by spending.

DAVID GREGORY:

Marc Morial, I want to bring you in. Back to this question of what James—Congressman Clyburn is saying. Which is that there is—an unwillingness by this Administration and this President to engage on matters of race, because of a kind of skittishness, not wanting to get too close to it.

MARC MORIAL:

Let me—

DAVID GREGORY:

Is that fair?

MARC MORIAL:

I think there’s two things—

DAVID GREGORY:

Because the President said—you heard him in 2008. We—we must—we can’t ignore it.

MARC MORIAL:

The President would benefit by a broad circle of external advisors and maybe some internal advisors who have the experience, particularly in the South—the contemporary experience of the Civil Rights Movement—that could serve as a sounding board. And I think that this President would benefit and every president would benefit by having those type of people—those experiences in his circle of advisors.

The second thing I just want to say is to what Rick said. What I saw from the Tea Party, and this is what many of us reacted to, were the aspersions on Congressman Lewis. Theaspersions on Congressman Clyburn. The awful billboard, certainly repudiated now, which compared the President of the United States, the elected leader of this great democracy with two of the worst figures in 20th Century history—Adolf Hitler—and Lenin. And what I ask myself, though, would I ever have seen a President Bush, a President Clinton, a President Nixon ever portrayed in that fashion. So, sometimes what people react to is not what’s stated, but they also react to what they think.

DAVID GREGORY:

But E.J., you made the point in a column, “Look, I mean—there’s extremists on the left. I mean, there are—there are movements that have people who go way beyond the pail on both the Left and the Right.”

E.J. DIONNE:

Actually, the point I made in that column, (CLEARS THROAT) was that going back in the 1960s, to the 1960s, when folks were burning flags, mainstream liberals were asked to repudiate flag-burning and they did. The NAACP did not say that the Tea Party is racist. They made a very careful statement, where they were saying that there is racism in the Tea Party and it ought to be repudiated.

RICK SANTELLI:

It’s in the Tea Party, the Democratic Party—

E.J. DIONNE:

No, but—

RICK SANTELLI:

•           and Republican Party.

E.J. DIONNE:

But no, this is—

RICK SANTELLI:

And more—

(OVERTALK)

E.J. DIONNE:

This is not the case. Look, there is a consorted conservative campaign, a part of the movement, a minority of the movement to use race to split people. Glen Beck says Obama has a deep-seated hatred for White people. J. Christian Adams, a Republican activist pushing this new Black Panthers story, says the Obama Justice Department is motivated by a lawless hostility toward equal enforcement of the law.

Now there are people playing with this racial politics out there. I am not saying, the NAACP certainly isn’t saying that this is the whole conservative movement or most of the conservative movement or most of the Tea Party. But it’s a part of this strategy. And people should condemn it.

DAVID BROOKS:

There are liberals who call conservatives racist as a matter of tactics, too. That happens, as well. Listen, I was out jogging, you wouldn’t know it to look at me. I was out jogging (LAUGH) you wouldn’t know it to look at me, I was out jogging on the mall. I was at a Tea Party rally, Tea Party rally. Also there was a group called the Back—Black Family Reunion, celebration of African American culture. I watched these two groups intermingle. Sitting at the same table, eating—watching concerts together. Among most of those people, there was a fantastic atmosphere of just getting along on—on a warm Sunday afternoon.

And so, there are people, but I—I was struck by a story of progress. A story of progress, that we’re making some progress to this. And this whole week, that speech was about progress. We now have a gotcha culture that punishes people that say terrible things. So, I think overall, it’s slow, steady—

DAVID GREGORY:

But can I—can I add into the mix here—in this week of this emotionally charged discussion came Senator Jim Webb, a Democrat, Virginia, who wrote an op-ed piece that raised a lot of eyebrows. We’ll put the headline—on the screen. “Diversity and the myth of White privilege.” The subhead, “America still owes a debt to its Black citizens, but government programs to help all people of color are unfair. They should end.” Anita Dunn? I mean, there are those even in the Democratic Party are saying, “Look, we have to have a real conversation about these issues.”

ANITA DUNN:

And I don’t think there’s anybody who’s saying we shouldn’t have a real conversation about these issues. But I also don’t think there’s anybody at this table or frankly most people in America who think that an edited two and a half minute clip that begins driving the news. That has reporters saying, “How is the White House gonna react? It’s a huge problem. It’s a huge problem. Are they gonna fire her? What are they gonna do? What are they gonna do?”

That’s not a reasoned conversation. I think a reasoned conversation is exactly what the President has tried to promote throughout his career. And that he has said we need to have. But let’s not mistake what’s been going on—over the past week for any kind of reasoned conversation. There was the rush to judgment on Shirley Sherrod. And now there’s a new meta-narrative, I think, based on another false premise. The idea that somehow Barack Obama is the problem with race relations in America or the reason we don’t have a conversation. I don’t think that’s true either.

MARC MORIAL:

David, I want to say this. One of the things this distracts from is the news of the week that the Senate cut out one billion dollars for summer jobs, but is prepared to spend $60 billion on a troop surge in—in Afghanistan. One of the things this distracts from has been the repeated use of the filibuster to block legislation and block measures that would help the economy and urban communities.

DAVID GREGORY:

Let me—

RICK SANTELLI:

Wait a minute—

MARC MORIAL:

That to me—that to me and the persistent use of the filibuster, it being used more times in the last two years than in the previous century to stop this—

DAVID GREGORY:

Quick—quick, Rick, hold the thought, though. I want to get your reaction to Jim Webb’s point in his editorial.

MARC MORIAL:

I don’t agree that—Latinos and Asians have not suffered discrimination in this country or that Native Americans have not suffered discrimination in this country. I think the question is how do you target and tailor policies that are gonna help all economically and socially disadvantaged people? And it’s a fair debate to have. But it also needs to be posited with facts.

Look at the Latino unemployment rate. It’s higher than the White rate. The Black rate is higher than the Latino rate. So, to suggest that there are not disparities—that affect the Latino community, that affect the Native American community. Most in depth, the African American community, we’ve got to have the discussion that Jim Webb wants to have, with facts. Real facts that give a picture of how life is in this nation.

DAVID GREGORY:

All right, Rick, make your point, then I want to take a break.

RICK SANTELLI:

41 cents of every dollar this government spends in fiscal 2010 goes to pay debt. It’s borrowed money. 41 cents of every dollar. Marcus, we have a three and a half trillion dollar 2010 budget. Let’s look at that $34 billion for extension. These people need help. But to think that this Administration and in Timothy Geithner’s interview, he talks about getting their fiscal house in order. And a three and a half trillion dollar budget, they can’t come up with a way to offset $34 billion in spending. It isn’t that the conservatives want to be mean-spirited. It’s that if at the end game, if the country is broke, everybody loses.

DAVID GREGORY:

All right. We’re gonna take a break here. We will pick up talking more about the Geithner interview, the economy and politics in our remaining—moments with our roundtable. Don’t go away. Right after this brief station break.

(COMMERICAL BREAK NOT TRANSCRIBED)

We’re back with our roundtable. So much to get to, and frankly not enough time. But Santelli’s taking over your role. He’s setting up the next topic beautifully. That segue artist that (LAUGH) E.J. normally is. I want to talk about the economy and—and some of what Secretary Geithner—said that I thought was—was pretty striking.

But first let me show you a couple of things. A poll from Bloomberg—just about a week ago, asking, “Are you better off than you were 18 months ago?” Look at that. 17 percent say yes. Worse off, 29 percent. Or about the same, 54 percent. That’s after the stimulus plan. Ron Brownstein in his column in The National Journal—says this.

“In the political context, polls suggest that an energized core of voters, possibly around 40 percent, has ideologically recoiled from Obama’s direction. That threatens Democrats, but their greater problem is that voters open to an activist government in principle are not convinced that it’s producing enough benefits in practice.” David Brooks, government has not proven to be the answer, and yet, that’s the fundamental argument from the Administration.

DAVID BROOKS:

Right. There’s been—there’s been a massive recoil in the past year. The Obama Administration has dropped about 20 percent among independent voters, in part because of the debt and other issues. But faith in government has plummeted back to its historic lows. Faith in Congress this week hit an 11 percent, the historic low forever. So, how do you persuade people that—you can do things when you have that kind of distress? And that hasn’t been solved.

The stimulus—obviously created some jobs. But the fact is it’s taken forever to get out. And the underlying reality is the more the debt goes up, the more people are scared. And the more they’re scared, especially small business, which is not investing.

DAVID GREGORY:

But Rick Santelli, this is again—and the liberal argument, which I brought up to Secretary Geithner is, to challenge your point of view, “Hey, wait a minute. You’re raising—raising the red flag about debt. Yes, they’re unsustainable. But the cost of borrowing money right now is so low that when you’re in this kind of exigent circumstance economically, why not measure spending commensurate with the size of the—the financial hole we’re in?”

RICK SANTELLI:

Let’s cover three areas on that. First of all, when people get addicted to bad substances, usually the people that supply it, give ‘em really good prices in the early days. I don’t think it’s a great idea that we are enamored with the fact that we can sell so much debt, because it could all change very quickly. At the end of last year, a Greek six-month bond was around two percent. It’s more than doubled. And it’s only seven months—

DAVID GREGORY:

We are not Greek. We can print money.

RICK SANTELLI:

We’re not Greece, yet. But that could be the ghost of the economy of the future, if we stay on this unsustainable path. The other thing is there’s some of us out there—that don’t believe the stimulus or the recovery package or the TARP did what it sold. Matter of fact, my opinion would be that what we’ve done is we’ve created a six day cure for a three day flu.

DAVID GREGORY:

The issue of taxes, Anita Dunn, is front page on the morning papers today, in the Post and the Times. The Washington Post—front page, “Battle looms on tax breaks as—the Bush Era—cuts are at issue.” The New York Times, “Next big battle in Washington, Bush’s tax cuts.” If the Administration is serious about cutting the deficit, why keep any of these tax cuts going? Because extending tax cuts to the middle class, those $250,000-- $100,000 or less, is gonna cost—about $250 billion to do next year.

ANITA DUNN:

David, the President was very clear as a candidate in 2008, as President in 2009 and 2010, which is he believes that the middleclass of this country pays enough in taxes and should not have a tax increase. He believes that they’re stressed enough and that they’re—and that they lost ground over the last decade. And that he’s not gonna raise taxes on them.

DAVID GREGORY:

But let me just—

ANITA DUNN:

He was clear.

DAVID GREGORY:

•           I want to stop you on this issue of tough choices, because I pressed the Republicans on this. It is tough to say to the American People, “I know you pay too much, but I can’t do it now, if I want to be serious about the deficit.” Why not say to the American People, “You gotta sacrifice. We gotta get rid of all these tax cuts”? If—if it’s a bad idea, which is what Democrats believe, that the tax cuts were a bad idea.

ANITA DUNN:

No, Democrats didn’t believe all of those tax cuts were a bad idea. As a matter of fact, David, there were battles in 2001 and 2003 from Democrats to do things like double the childcare tax credit. Two—make the tax cuts more progressive at the bottom end. So, they didn’t believe all of those tax cuts were a bad idea. Either in 2001 or in 2003.

What they did believe and what they continue to believe is that—is that the very, very highest end and the people who did the best, the two percent, two percent of the 300 million people in this country, that they can pay a little more during this time. But in terms of the deficit piece of this, the President is absolutely convinced and is taking steps. There is a bipartisan deficit commission. And I know in Washington, bipartisan commissions come and go.

But this is a very serious effort. And they will come back with recommendations. There are gonna be tough choices in there. The President’s already directed his cabinet agencies to cut their spending. There are gonna be tough choices in there. And there have to be. Because I think everyone recognizes that.

DAVID GREGORY:

I’ve got about three minutes left. E.J., you can way in on that. But I want to show—the—the President spoke to the Netroots—Conference over the weekend, so this is a developing story about—the Obama agenda and some of the complaints from the left. And I just want to play a portion of that.

PRESIDENT OBAMA ON TAPE:

So, in ways large and small, we’ve begun to deliver on the change you fought so hard for. And we’re not done. We’re working to repeal Don’t Ask, Don’t Tell. We’re working to close Guantanamo in a responsible way. And thanks to the heroism of our troops, we are poised to end our combat mission in Iraq by the end of August. Completing a draw down of more than 90,000 troops since I took office. We’re moving America forward. And when we’ve come this far, we can’t afford to slide backward.

DAVID GREGORY:

What’s striking about that is that the President has a problem with independent voters, but he’s also got those on the left who are pretty disappointed.

E.J. DIONNE:

Right. And I think that’s important to the outcome of the election. I just want to say one thing on this tax issue. Warren Buffet very famously said that he pays tax at a lower rate than his receptionist. Because of the way we tax dividends and capital gains, the truly rich people in the country, according to a study last year, the 400 richest people pay taxes at a lower rate, in effect, than firefighters, than police officers, than shop clerks.

That’s why we need to raise taxes on the very wealthy to cover the deficit, because guess what? The tax increases on the wealthy do not have an anti-stimulative effect, the way tax cuts on average people do. Barack Obama was very smart to do that. He needed to do that. They’re—the Democrats are gonna be in trouble if their own people don’t turn out. Right now, Rick Santelli’s—Tea Party has really motivated a lot of people on the right. The Administration and Democrats have to do a lot more motivating on their side.

DAVID GREGORY:

Let me—get your thoughts about fiscal responsibility, but save me 30 seconds to talk about—Charlie Rangel, okay?

DAVID BROOKS:

Oh, I—I-- (LAUGH) cap gains rates, if they’re not gonna raise—they’re raising the rates of income tax rates. That doesn’t matter. Listen, my view of the—of fiscal policy in the economy, it’s just not that strong. We’ve learned you can pump a lot of the money, you’re not gonna get short term buzz. You should think long term. What can we do long term to get fair taxes, simple taxes, structure and innovation? So, I—I think the idea we’re gonna fix the economy or fiscal policy in the next six months or a year, it’s fallacious.

DAVID GREGORY:

Marc Morial, can—can Charlie Rangel survive the ethics trouble he’s in?

MARC MORIAL:

Last time I walked through the streets of Harlem, Charlie Rangel still has incredible support. And I think what this week tells us is let’s not prejudge Charlie Rangel. Charlie Rangel has a right to be he heard. And I think we need to hear his side of the story. He’s a great Congressman. He’s a great American.

DAVID GREGORY:

But Ani—Anita Dunn, the last thing Democrats want right now is a full airing of ethics charges against one of their members—when Congress rates at about 11 percent approval.

ANITA DUNN:

You’re arguing it could go lower? (LAUGH) Well, here—I—I think we—we have to think about what Marc Morial just said, because the reality is we should listen to him in context before we judge.

DAVID GREGORY:

All right. We are gonna leave it there. Thank you all. Pretty spirited discussion. We will be right back.

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