'This Week' Transcript: Economic Roundtable

STEPHANOPOULOS: All tax cuts? No increases of spending of any kind? Yet more economists say that investments -- the right kind of investments create more jobs than tax cuts.

DEMINT: Well, I'm not sure what economists you're talking to, but we've met with a lot of them over the last week. You can look back in history, and leaving more money in the economy through tax cuts is the way that works. And government spending is -- you can see little bumps.

But this plan is a spending plan. It's not a stimulus plan. It's temporary, and it's wasteful. And a lot of the spending is going to end up being permanent, George.

So we have to decide if we want to be a free-market economy and let -- and let the money stay there or if we want to be a government- directed economy, which is where we're headed with this plan.

STEPHANOPOULOS: You voted for the package?

FRANK: I did. And the -- I regret Senator DeMint saying that this is the American way. Let's -- let's just agree that we're all Americans here, Jim, and that nobody's got the American way versus presumably the non-American way.

And as far as spending versus tax cuts, I think we need to fix some highways and bridges. I never saw a tax cut fix a bridge. I never saw a tax cut give us more public transportation. The fact is, we need a mix.

We need -- and I think we've suffered from an extremism in this country in the past of relying only on private-sector activity and having too little government. It's possible to have too much government, no question. But it's possible to have too little. And some parts of this stimulus -- extending unemployment benefits, helping with food stamps -- you know, we have two purposes here. One is to stimulate the overall economy. The other is to go to the aid of some people who, through no fault of their own, have been damaged. You can't just look at the aggregates.

I think we've gotten in trouble by looking only at the aggregates. If the GDP goes up but income inequality greatly increases and a lot of average workers are feeling put upon, it's a problem.

But I want to see some improvement in our transportation structure. I'd like to see some improvement in education. We have state governments laying people off, cities being told they're going to have to lay off firefighters. A tax cut isn't going to keep the city of New Bedford...

STEPHANOPOULOS: Those are all the broad...

FRANK: ... from laying off firefighters.

STEPHANOPOULOS: You mentioned a lot of the programs, yet one of the criticisms the House plan has gotten is it also includes a lot of spending for things that don't seem to be stimulative, contraception, things like that.

FRANK: Well, you have some -- well, one, I thought, contraception was out of the bill. I guess the people resented the fact that it was out of the bill.

There is some money now I guess to fight sexually transmitted diseases. Those are jobs. By the way, very few people volunteer to fight sexually transmitted diseases. They get paid to do it.

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