Roundtable II: This Week in Politics

James Carville, Mary Matalin, Peggy Noonan, Paul Krugman and Jonathan Karl.
3:00 | 10/07/12

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Transcript for Roundtable II: This Week in Politics
john McCain has been dead wrong. I love him. As my mother would say, god love him, but he's been dead wrong on the fundamental issues relating to the conduct of war. I would like more opportunity for this. I like being able to answer these tough questions without the filter even of the mainstream media kind of telling viewers what they've just heard. No one in the united states senate has been a better friend to israel than joe biden. I may not answer the questions the way that either the moderator or you want to hear, but I'm going to talk straight to the american people and let them know my track record also. That was four years ago. The next vp debate is thursday night. Working on the roundtable we'll preview that in just a little bit. Peggy noonan, paul krugman, jon karl, mary matalin and james carville. The unemployment numbers that came out friday. I got to say, peggy, I was surprised first thing at "gma," the numbers come out, the first tweet you get from jack welch raising a question about them. Ed gillespie didn't bite but what is that about? Oh, it's about widespread skepticism towards the actions and efforts of the u.S. Government to begin with. Second, I don't think anybody in america looks at the number, whether it's 8.2, 8.4, 7.7, and thinks that's a real reflection of reality. Everybody in america thinks they're not counting the number of people who have stopped looking, the number of people who are underemployed. At that point the 7.8 number almost becomes academic. Nobody has faith. Look, we know it's a lousy labor market out there. It's not what you want to have, however, it's an improve ing labor market and not because of one month's numbers but one month, the whole thing, jack welch probably coming from the corporate world, he doesn't quite understand how it is to fudge government numbers. But the -- if you look over the past year, which is what you should do, you should not look at the numbers, there's a clear improvement. It's clear that adjusted for the changing and for the aging of the population, the number of people with jobs this year of the relevant population is rising, clear that the payroll growth has exceeded population growth. So this is an economy that is slowly on the mend, and in a way the aberration was not this last month's number, but the previous unemployment rate didn't fall even though the underlying situation was -- you know, you brought up a trend over the last year and I'll come to you in a second, jon. This chart showing that trend across several presidencies of the last year of an incumbent running for president and does show, mary matalin, that president obama is the improvement in the re-election year is in the green zone where presidents get re-elected. The real world peggy alluded to. Real medium incomes have fallen twice as much under the obama recovery as they did in the bush recession. At this point in time under ronald reagan's policies, which governor reagan has a 21st century application of, jobs grew at five times the rate they are. Let's look at the states with 17 governors, republican governors instituted reforms. Those states are growing their economy and creating jobs at twice the rate the national one is. This is about policies. We know they've worked. There is no recovery in the history of any recessions or depressions that have been as slow and as poor as this one and the revisions upwards -- yes, it does, professor/dr. Krugman. It's completely totally true. I don't make up numbers. Well, but just look at them then. The fact of the matter is this is actually a fairly typical slow post-financial crisis recovery, which is picking up speed, so although it's terrible, and I've been bitterly critical of policymakers in general for not doing more, the fact of the matter is we are clearly now in the upswing where you can see the beginnings of a turnaround. The challenge for romney is that, look, it's not just the unemployment number here, consumer confidence has been up for six weeks in a row, you've got the stock market is up. You have housing prices are up. There's a sense that things are still bad but getting better, battleground states. You've got the governor of florida going around talking about the recovery in florida. You've got republicans -- republican governors. In ohio -- yes, but how do you run against the economy when you have republican governors -- as you said -- they're being replaced by republicans are growing the economy. You have -- you have a situation where welch put this out. Now, here's a party that a large number of believe in creationism and deny global warming, think that obama was not born in the united states, believe that tax cuts raise revenue so -- and -- it's not surprising they're going to believe somehow or another to be -- this is economic birtherism. That's what it is. You have to keep your eyes just for a second on the fundamentals. Thank you. One of the reasons people don't think things are getting better economically is not only because they have eyes, but because they know our fundamentals are bad, the spending is terrible, the tax structure isn't competitive. They're looking down the road and seeing -- and prices have doubled. Health care premiums have gone up. Move to not make it better. Maybe change would be a good job in order to get growth. But that's an imaginary public you're talking about. Polls show that the economy is now dead even despite the lousy absolute state of the economy, people think that obama -- you know as well as I do spending continues to be huge but our tax system isn't competitive and everybody out there worries about that. Oh, my god. People's optimism about the economy is increasing a little bit. Broad spectrum of consumer confidence -- I'm going to say one thing about this whole conspiracy theory. I went down to bls and talked to the woman in her cubicle who wrote the announcement, 7.8%. There is not a single political employee in the entire bls right now, not one. I mean this is crazy town to think that it was -- when you say people don't most trustworthy. I mean, there are the inherent problems of economic data which are all science faction, but these are honestly constructed science fiction. Most people don't understand, you do, obviously, but how this is done. This is a survey of 60,000 households. George, eighth a survey. It last a margin of error. About 400,000 jobs it could be. The margin is 0.2%. You could have 8% unemployment. The survey of employers and households and they're telling the same story of an economy that is slowly on the mend, slowly but slowly on end. It's a belly crawl. It's a belly crawl. You like to talk about your data, professor. Here's political data. 80% or three-quarters of seniors, women, men and independents think that the obama policies did not help either their personal situation or the economy. Majorities of women, men, independents and seniors and small business believe that the obama policies have hurt the economy. This is about policies. It is -- you want me to read your data. I'm saying read our data. The reality -- the point is that in boasting about the unemployment number, you know, the obama people are making too much out of one month's number which everybody does but there's a fundamental truth that things are getting better. Not as fast as they should by a long shot. We're maybe a quarter of the way back from the damage that was done by the financial crisis, but we are making our way back. So when you look at both events, and let me ask you all to weigh in, how much did the race change this week? I think it changed. I think romney helped himself but I think this is a clarifying event because now the republicans are enthusiastic about romney, and they're The winner of this race will have real legitimacy. This is not going to be a thing where they say, well, he really didn't represent our caution. Now that -- if the president wins re-election, then you're going to see sort of policies along the clinton line when it comes to tax on top earners. You're going to see the health care bill stay in place. You'll see regulation of wall street stay in place and see these things happen. If by the same token if romney wins, he'll have the authority of an election behind him, so i think this gives the next president a real boost when he gets in there. I think one of the key things about the debate is it's change -- we will look back on it as an historic moment in this election. It upended things. This is what it upended. Barack obama was supposed to be the sort of moderate centrist fellow who looked at mitt romney, this extreme, strange fellow. By the time that debate was over, mitt romney seemed a completely moderate centrist figure who showed up as mitt romney the governor, not as mitt romney the candidate. Except that everything he used to clean his centrism wasn't true, so this is a question, does that start to take its toll over the next few months? I think that is unjust. I mean to say the very least -- he came -- when you say -- when you say my plan cover s pre-existing conditions when it doesn't and when your own campaign admits it doesn't, that's amazing. You have mitt characterized and you have lied about every position and every particular of the ryan plan on medicare from the efficiency of medicare administration to calling it a voucher plan so you're hardly -- it's a voucher plan. You're hardly credible on calling somebody else a liar. But the fact of the matter, i just think that pre-existing condition thing was a defining moment. It was saying this guy believes not only he can say something not true but something his own and say it in front of 70 million people. That's amazing. The other thing that offended was governor romney effectively shut down the legions that obama has erected against him and mitt romney, the real mitt romney is, what has belied all the stereotypes and demonic mischaractations of him, $300 million of attack ads so people got to see, as ed said, the real mitt romney, and they liked his positions and supported all those positions and liked hip as a person. Mitt romney also nailed the president on not working well with the other party and made the point that he can work well with the other party as he did in massachusetts. Yes, set the record for -- for vetoes in massachusetts. Yeah. Exactly. But I'm not -- democratic legislation, you have a veto a few things. The choice is going to be, do you go back to the clinton tax rates on people that earn over $250,000 and do you keep the health care bill in place or repeal it? Do you keep wall street regulation in place or do you repeal it? Do you have a foreign policy that leads with diplomacy, not war? That's going to be the consequence of this election. It may not be like everybody wants it but the new president is going to come in with real authority. Gladys knight getting back to your question, george -- static about romney/ryan now. Thi is a new race after that debate. Imagine if romney had come in and had a terrible performance, you have what happened before and the jobs number on friday, it would have effectively been over. This now is a real race, republican fund-raising has picked up dramatically this week. Look at the crowds he had just yesterday in florida. He is a new candidate. He is somebody now who has enthusiasm. He definitely got back in the game but we'll be watching where the polls are in the battleground states, especially ohio. Let's look ahead to the vice Both vice president biden and paul ryan setting expectations this week. You're not going to rattle joe biden. Joe biden has been on the national stage, he ran for president twice, he's a sitting vice president. What I hope to achieve is to give people an alternative. I just want to make sure that when I say these things, that i don't have the congressman saying, no, no, no, I don't have that position or that's not the governor's position, and so it's mainly getting the factual predicates for everything. Now, this debate is going to cover a lot of topics including night, but, james, it is clear from talking to both ed gillespie and robert gibbs this morning they're going to continue to zero in on this whole issue of the romney tax cuts. Is it vouchers or not? What is governor romney's -- as they should. As they should, but what romney proposed was he was going to cut tax rates to 20% for everybody, that's $4.8 trillion over 10 years. What they're saying is how are you going to pay for this? He says, with unspecified, unspecified -- big bird. They should hone in on that. As paul has pointed out, paul ryan's plan just calls for cuts. Doesn't say what the sort of cuts are. That's a legitimate thing in an election. What could be more legitimate than that? Still the fact of the matter is that ryan -- despite, you know, however he manages to put it across and however how aggressively, romney is calling for his tax cuts for the rich, which he says he'll make up for and refused to say anything. This is amazing.U say I'm going to raise $5 trillion revenue but I'm not going to tell you how to offset those -- like you said, max cap deductions of $17,000. Hasn't committed -- no plan at all. It's amazing. 5 trillion. The only -- professor krugman's argument is to cherry pick data. He does not look at even the most recent study by harvard researchers, your sort of colleagues. That was a -- you can do it as long as you include people with incomes between 100,000 and $250,000. I didn't finish my point. The biggest impediment to our economy is entitlements and medicare and the ryan plan -- we're not just talking about a tax reform but regulatory reform that costs $10,000 per employee that's a drag on the economy and we're talking about fixing medicare, reforming medicare which the harvard guy said had his plan been in place would have reduced spending by 9% in one year. The guy is martin feldstein of -- I'm talking about the american medical association report. This is -- well, look, you know, romney has not given -- I don't understand why it's not clear to say we want to lower the rate, widen the base. We will work at -- this is a grown-up thing -- I will have a legislature. But, peggy -- we will work this out. Peggy -- ronald reagan did this reform, tax reform in '86. It was a negotiation. People are talking about '82. Ronald reagan signed on to one of the largest -- one of the largest tax increases -- that was a tax -- that's why -- tax reform -- kept it from exploding. Worked out -- you have to have some notion of what you want to do. The issue here is that, you know, romney has not put any of the details out. I mean, that is true. He's thrown some ideas. He said he's going to balance the budget in seven to ten years while doing tax reform, while increasing defense spending, not touching medicare. that don't add up but because romney has not given the details doesn't give the president the right to make them up for him. I mean, he is not going to have a $5 trillion net tax cut. Absolutely good at details -- that's not his plan. But I think to say there's a $5 trillion tax cut to be offset by mystery meat. You know, that's a correct statement. Or -- there's a $5 trillion tax cut, well, but we don't know what it is he's going to do but what he proposed is a $5 trillion tax cut plus he says, trust me, I'll do something he different. That's not a very good -- yes. What can be more legitimate than saying you're proposing $5 trillion in a reduction in revenue. How are you going to pay for this, and he says I'm not going to tell you, I'll just let the congress do it. So you say, no, these are the things you have to get rid of. Get rid of t child deduction or home mortgage deduction. And we're going to have -- he said it. You just don't listen to -- the end of the story -- you don't want to -- he already wrote the bill. Do you want him to be more specific so that you can rouse people against this or -- absolutely, absolutely. And keep anything good or helpful from happening with regard to cutting -- I think he needs to tell the truth. I do. You're right. I want to have all of you back after the next debate. We have a lot more to talk you obviously have a lot more to talk about. That was a fantastic roundtable. Thank you all, and for you at home that want to weigh in, jon karl will answer your questions @jonkarl. In just 60 seconds I go

This transcript has been automatically generated and may not be 100% accurate.

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