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What Should Government Do To Overcome Inequality?

Aired December 16, 2013 - 18:28   ET



ANNOUNCER: Tonight on CROSSFIRE, the budget battle moves to the Senate. Will it attract enough Republicans to pass? And what does it say about our priorities?

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: While we don't promise equal outcomes, we've strived to deliver equal opportunity.

ANNOUNCER: On the left, Stephanie Cutter. On the right, Newt Gingrich. In the CROSSFIRE, Cornell West, a philosophy professor, and Ross Douthat, a conservative commentator. What's government's role in overcoming inequality? Tonight on CROSSFIRE.


NEWT GINGRICH, CO-HOST: Welcome to CROSSFIRE. I'm Newt Gingrich on the right.

STEPHANIE CUTTER, CO-HOST: And I'm Stephanie Cutter on the left. In the CROSSFIRE tonight, guests with different views about what government should do about the inequality in our country.

Today it looks like Senate Democrats have put together enough Republican votes to pass the new budget deal. A compromise that Congress needs to pass. Here's why.

Most important: it avoids a government shutdown. Second, it gets rid of those across-the-board budget cuts that were incredibly damaging, particularly to the middle class. Finally, it allows us move on. Let's set the bar slightly higher than just avoiding a shutdown and actually start to do the work the American people expect of Washington. How about addressing economic inequality?

If it's important enough for the pope to highlight for the entire Roman Catholic Church, it certainly should be important enough for Washington to take action. And instead of the same old ideological fights like big government versus no government, let's agree that the truth is somewhere in the middle and get something done.

GINGRICH: Boy, I hate to --

CUTTER: I'm sure you don't have anything to say about that.

GINGRICH: I hate to shock our audience, but I think a lot of what you just said is right. CUTTER: Whoa!

GINGRICH: The biggest disappointment to me in this whole budget process, and there's no question Paul Ryan is a brilliant person, but this was really just addition, subtraction. No real creativity, no really interesting useful ideas, no breaking out. And I think it's a disappointment.

And I want to turn. We have two really good guests tonight. Cornell West, a philosophy professor at Union Theological Seminary, and conservative columnist Ross Douthat, neither of whom is timid, shy, passive or lacking opinions.

So I want to come first, Cornell, to you. You've seen the deal. You understand the arguments both ways on this budget deal. Tomorrow the Democrats have to have every Democrat vote yes, even though it doesn't have unemployment compensation extension, even though it doesn't do anything about inequality. If you were in the U.S. Senate tomorrow, would you vote for this budget deal?

CORNELL WEST, PROFESSOR: I think I would begin with a speech that says this is Scrooge without the spirit of Christmas. It's too cold- hearted and mean-spirited. We need to have the unemployment benefits and so forth. And yet at the same time, I think I would still vote for it. Why? Because it's a moment of bipartisan coming together.

Let's make real the words about inequality that Barack Obama put forward and the words of Nelson Mandela. Appreciate your strong words for brother Nelson. Nelson Mandela, and say let's look at big banks, look at big corporation, strengthen our progressive trade unions, and make sure that we can stop this upward distribution of wealth to the 1 percent -- was it 1 percent of 95 percent of the new income since 2009?


WEST: Exactly, that's right. Because the neoliberal regime cuts across both parties.

GINGRICH: I want to -- I just want to note for the record one of those rare historic moments. That we just had you say that you would actually vote for something that is much too mild, much too meek, but you'd vote for the process. I think that's a very interesting position on your part.

WEST: But that's one reason why I'm not a senator. If I was locked within those constraints, given the dysfunctionality, I would affirm the process and say, let's be bipartisan.

DOUTHAT: I think I would vote for it for the opposite reason. I think it's an acknowledgement, and a welcome one, from both parties that there isn't actually going to be a process over the next few years because the political parties are too far apart on fundamental issues about the long-term structure of government.

And basically, what you've had over the past few years, it hasn't been pretty, but it's been a kind of weird bipartisanship where we've had some tax increases on the rich, which is the easiest part of the Democratic agenda to enact, and we've had some spending cuts and discretionary spending, which is the easiest thing for Republicans to do.

And everybody sort of realized that, to get any further, Democrats would have to raise taxes on the middle class, which the Democratic Party -- Brother West here being an exception -- is not about to admit they want to do. And Republicans would have to pass cuts to Medicare and Social Security, which I think, to Republicans' credit, they're willing to admit they want to do but isn't going to happen with a Democrat in the White House.

So in a sense passing this now is a statement, OK, we're just going to do some small ball deals, and we're not going to pretend that these big issues are going to be resolved in what is now a lame-duck presidency.

CUTTER: I disagree with you, Ross. I think that --

DOUTHAT: I'm shocked!

CUTTER: I know you are.

DOUTHAT: Every day.

CUTTER: We've never disagreed before, but this is a first. You know, I think that there are lots of tax loopholes out there that could be closed that could fund critical programs to growing the middle class, to close that income inequality gap. We could raise the minimum wage.

And one thing that Congress didn't do, which a lot of us wanted them to do, is pass unemployment benefits. One point three million people are going to lose benefits at the end of the year. It's estimated that that would cost the economy, everybody, 204,000 -- up to 240,000 jobs.

My question to you is this is all happening over the holidays, about to have Christmas. People are going to be losing their benefits. We're going to see stories of increased hardship. Will the Republicans join Democrats in passing unemployment benefits when they return from the holidays?

DOUTHAT: My guess is yes. I -- and I would make a distinction here between you're throwing a bunch of different ideas out here, right? I think, look, there is a case, a decent case for continuing to extend unemployment benefits, maybe with more job training requirements and other amendments, as long as the unemployment rate is where it is.

That's very different, though, from something like raising the minimum wage, which is basically something that effectively makes it harder for low-skilled Americans to find work at a time when unemployment is still very, very high. So there's -- you know, there's sort of plausible liberalism, and then there's implausible but feel-good liberalism. And I think raising the middle wage is an example of the latter. WEST: I think back to the neoliberal regime that we're talking about.

DOUTHAT: I can feel it all around me.

WEST: We've had a bipartisan agreement on austerity. That was a mistake. Bipartisan agreement on deficit obsession. That was a mistake. Where was the creation on not just job creation but jobs with a living wage? Where's the empowerment of workers? And most importantly, I was blessed to spend time at Rahway Prison with my brothers for about seven hours, and you look at America through their lens and what do they see? No serious talk about the new Jim Crow and the prison industrial complex. No serious talk about poverty.

DOUTHAT: I think you are seeing some serious talk about prison reform from Republicans.

WEST: Well, Eric's movement, Eric's movement, brother.

DOUTHAT: From Rand Paul --

WEST: In Newt's new book, he's -- Newt's got a chapter on it that is actually, I think, quite challenging. And Eric Holder is beginning to talk.

DOUTHAT: Well, Eric Holder is adopting ideas that Rick Perry in Texas adopted first. So I think this is a case where once again the Republican Party is out ahead of the Democratic Party on addressing the issues you care about.

GINGRICH: Let me ask you a question that actually ties together this whole challenge of prisons and the challenge of unemployment compensation. It strikes me that there are -- there are large parts of America where we have got to find a way to have a totally new approach to job training, to education.

I'm very impressed with the Germans, who are the most effective economy in Europe, have 40 percent of their population goes into apprenticeship programs and learns how to do very sophisticated manufacturing. And they dominate large parts of sophisticated manufacturing. It's really different than our models.

And my question, let's take unemployment compensation. I would be eager to support extension if we attach some kind of learning and training program so that people were not just being sustained, but they were taking the time when they didn't have a job to actually substantially increase their potential job capability. I mean, could you support that kind of linkage?

WEST: I could certainly support that, dear brother. The problem is, is that if you have an economy where the major priority still is one in which big banks and big corporations dominated, you're not going to be able to generate the jobs that ought to be living jobs with a living wage once they actually come out of apprenticeship programs.

See, Germany doesn't have an economy in which they are so thoroughly obsessed with "privatizing," financializing. Of course, they don't have to militarize with drones and so forth the way we do. They don't have an empire the way we do. so that we can learn something from them.

DOUTHAT: That's because we handle some things for the Germans, so they don't have to handle it for themselves.

WEST: That's true. That's true. But --

DOUTHAT: But here's the question. Here's the question for the liberal side of the table. If you look at President Obama's second-term agenda, right, and he gave this speech about inequality. And I think there's actually a big distinction between focusing on inequality and focusing on social mobility, which is what I think conservatives should be for.

But just take inequality.

WEST: Yes.

DOUTHAT: What is the centerpiece of President Obama's remaining second-term agenda? It's an immigration reform that, by design, would dramatically increase levels of low-skilled immigration for the foreseeable future.

Now, maybe that's the right thing to do for other reasons of social justice and sort of justice for people outside America's borders, but there's almost no question that, if that passes, it will increase inequality by creating more competition for exactly the kind of jobs for people coming out of prison and so on.

WEST: And you're absolutely right. As long as the neoliberal regime remains in place, then that divide-and-conquer strategy will be operating between brown and black and white and so forth.

DOUTHAT: So you're saying as long as --

WEST: But what we need -- I love these pictures. McDonald's and Wal- Mart and Wendy's and so forth. We need workers coming together across race so that, on moral grounds, we must ensure that our Latino brothers and sisters are treated with dignity. But they need to come together as citizens and as workers to get some accountability to big banks and corporations.

GINGRICH: We are going to continue this. It's obvious that this particular budget deal isn't going to solve anything, but at least the government is still open.

If we care about the poor and if we care about compassion in this Christmas season, where do we go from here? In the last month Pope Francis has been focusing some very strong language on this problem. We're going to ask our guests about it next.


GINGRICH: Welcome back. In the CROSSFIRE tonight, Cornell West and Ross Douthat. The Senate is getting ready to vote on the budget compromise. All signs point to it passing tomorrow. Here's the problem. Washington continues to be trapped into small incremental agreements that merely avoid disaster so the government won't close. That's progress?

Pope Francis, however, is raising the standard dramatically by pointing to the gap between the very, very wealthy and the very, very poor. The pope has said bluntly he is not a Marxist, and frankly, most of what he's saying is in scripture.

In this Christmas season, it's hard to argue Jesus wasn't radically concerned about the poor. The question is, what can government do that actually will help rather than hurt?

And I want to ask this question, Cornell. It's something that I was really struck with.

We are on the edge of the 50th anniversary of the war on poverty, and it strikes me that there has to be -- if conservatives need to be concerned about the poor, liberals need to be willing to put all of these bureaucratic institutions up and look at them critically for whether or not, in fact, they're helping rather than hurting.

WEST: And I think we have to be very honest about serious talk about redistribution. People are afraid to talk about redistribution. Within rule of law, it is not only necessity; it is imperative. It's the only way.

Twenty-two percent of our children of all colors living in poverty in the richest nation in the history of the world. It's a moral disgrace. Some kind of redistribution has to take place and not by programs only. Jobs with a living wage.

But I love the pope. I think, in fact, that Edward Snowden -- we've seen the triumph of Edward Snowden and his recent decision. Edward Snowden probably should have won that Man of the Year for "TIME." But I love Pope Francis, because he's a prophetic voice. His tone and his tenderness having to do with the humanity of poor people of all colors. We need that in the discourse.

DOUTHAT: God intervened with "TIME" magazine, so there was really nothing that could be done.


CUTTER: I think the one thing we all agree on is that we all like Pope Francis.

But, Ross, I want to ask you a question. There's no question that government programs can be better in terms of creating opportunities, putting people on a road to opportunity. In fact, the president has put reforms in place and here was his message earlier this month in his economic inequality speech.

(BEGIN VIDEO CLIP) BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Progressives should be open to reforms that actually strengthen these programs and make them more responsive to a 21st century economy.


CUTTER: So the president --

DOUTHAT: Who could argue with that?

CUTTER: Well --

WEST: The problem is the response to the 21st century economy, that's what needs to be contested. The 21st century is a neoliberal economy. That's what needs to be called for.

CUTTER: But also, Dr. West, we have to acknowledge that in rethinking these programs, you've got to take into account that some people don't want to rethink them. They want to just eradicate them, get rid of them and that's many times what the debate is on the Hill. Food stamps --


DOUTHAT: Here's the challenge for progressives, right? Progressives built a set of programs, a set of entitlement programs. Medicare and Social Security, that basically were designed to disguise the fact that they were, as Dr. West would put it, redistributing, right? So, you pay Social Security taxes, you may Medicare taxes and so people have the idea I'm just getting out what I paid in.

The problem is that's not what really happens, right? You actually -- a typical Medicare recipient gets back vastly more from Medicare than they pay in, likewise with Social Security. So what's happened to liberals is that these programs are essentially crowding out the rest of the federal budget.

If you want to know why liberalism has so much trouble getting traction for straightforward redistribution, it's because entitlements claim more and more and more of the federal pie.

CUTTER: You do a very good job making this about liberalism instead of talking about the problems of conservatism and that was my question to you. Where is the conversation amongst Republicans to reform these programs for the better rather than just slashing them and getting rid of them?

DOUTHAT: I think you've seen a pendulum swing basically. You had an era under President George W. Bush where there was a lot of talk about compassionate conservatism and doing exactly that, thinking about reforms that focused on poverty and so on. The Bush presidency ended, I think we can all agree, fairly badly. Some of the things that the Bush presidency tried to do with home mortgages and so on ended up blowing up in their faces and --

(CROSSTALK) DOUTHAT: And you had this swing, a swing towards a more --

CUTTER: Slashing the education budget.

DOUTHAT: Smashing the education budget under George --

CUTTER: Slashing the education budget.

DOUTHAT: No Child Left Behind increased the budget.

CUTTER: No Child Left Behind was basically an unfunded mandate. And he didn't fund it, which was the largest problem.

GINGRICH: Are you saying education funding hasn't gone up?

CUTTER: No. I'm saying that we -- of all of the investments in this government, we have given under George Bush tax cuts to those at the top, slashing critical program that say grow the middle class, including education.

GINGRICH: As a matter of fact, as education funding gone down a single year in the last 12 years? Has it gone down a single year?

CUTTER: New, has it gone down? Has it gone up enough?



CUTTER: Has it gone up enough?

GINGRICH: This is like your kids saying I need a Ferrari for Christmas.

CUTTER: No, it's not --

GINGRICH: And you're saying --


CUTTER: It's like we're saying we need a skilled workforce.

WEST: No, no.

DOUTHAT: No, and the deeper question --

WEST: No, I think --

DOUTHAT: -- and what are you willing to say, we need to actually tax the middle class to pay for the education spending increases that you want. Again, I think, Dr. West would say --

CUTTER: Or asking everybody to pay their fair share.

DOUTHAT: -- we'll do it.


WEST: As long as it's fair.

But I think Stephanie is making a strong point. Namely, when you look at what's really at the top, military, taxes that are almost subsidies for agribusiness, subsidies for corporations and so forth, what is left over is something that we try --

DOUTHAT: But again, your question was about conservatism. Who in the Republican Party has been most willing to take on defense pork and potentially even agribusiness? It's often been the Tea Party wing of the party.

The ultimate answer to your question is I think there is actually a real rethinking going on on the right now with figures like Senator Mike Lee of Utah and others looking at new approaches on poverty and other issues.

And I completely agree. The Republican Party has not had much of an agenda for the past few years because it's just been focused on opposition, but I think that's target to change.

CUTTER: We did have a Ryan budget.

WEST: No, but I mean, but brother Newt's got some ideas. I've been reading him recently that try to combine some of the notion of the right wing populist. The populism I like. The right wing I don't. It can be too racist, xenophobic, homophobic, and all a whole host of other things. But the populism I like --

DOUTHAT: They're two great things that go great together.

WEST: But they usually can't execute, because you've got Wall Street sitting there. You've got corporate America sitting there. And I'm telling you, if we don't hit Wall Street, big banks and big corporations head on, we're not going to go anywhere.

GINGRICH: First of all, Wall Street has been as close to the president as --

WEST: I know. I'm the first to say that. I'm the first to say tat. Wall Street and the president --


CUTTER: They're not very happy with all the Wall Street reforms that he has passed. So --

WEST: There are a lot of things I'm critical of, but I like the speech if he can follow through, and that's he's discounting us (ph).

GINGRICH: Let me ask you about a very different kind of redistribution.

My hunch is, and I don't want to date it yet, before you're back in the show again. My hunch is you could take what we pour into certain social sector bureaucracies, and if you found a way to get it directly to the poor and skip all the people in between, you would radically increase their income.

WEST: I'm with you. I'm with you.

Nixon called for a guaranteed income. I resonate with that notion for the very weak and the very vulnerable.

DOUTHAT: But here's where we can draw right/left cleavage because I -- I'm with the speaker on the point that the best -- the thing the government does most effectively is just write checks. The layers of bureaucracy you put in place tend to do more harm than good.

But the problem with just writing checks is you end up creating a culture of dependency. So, what you need is a welfare state where those checks are tied somehow to work and family, in ways that actually foster upward mobility.

CUTTER: There's lots of great programs currently sitting in Congress that the president has proposed that do just that. So, hopefully in the New Year, we can take a look at those and create some bipartisanship around them.

But stay here. This is an important -- conversation for us to have. And we're going to come back to this. We want you at home to weigh in on today's "Fireback" question, exactly on this point. Should job training be required to receive unemployment benefits? Tweet yes or no using the #crossfire. We'll have the results aft break.

And -- next, we'll let our guests weigh in on a subject everyone, including "Saturday Night Live" is discussing.



UNIDENTIFIED MALE: That's right. I guess the truth is out. You heard of secret Santa. Well, here's a secret for you -- I'm black as hell!



CUTTER: We're back with Cornel West and Ross Douthat.

Now -- I'm sorry, Ross.

It's time for the final question. It involves the discussion that sparked this skit on "Saturday Night Live".


UNIDENTIFIED FEMALE: It doesn't bother you when people like Megyn Kelly insist that you're white?

UNIDENTIFIED MALE: Well, I'm surprised people that ever thought I wasn't black. Have you ever known a white man to wear an all-red suit?



CUTTER: OK. So, this is the question we've all been waiting for, and we're dying for the answer. What color was Santa? Or is Santa?

DOUTHAT: We all know Santa Claus was Turkish. Everybody knows it. St. Nicholas, third century, fourth century. Maybe Professor West can correct me.

No, look, this debate comes down to whether you think Santa Claus is a real person or not.

GINGRICH: Not on this show. Santa Claus --


WEST: No, but he's got a point about Turkey.

DOUTHAT: Santa Claus --

WEST: Emphasis being right at the center --


DOUTHAT: Santa Claus is a culture figure, can be any color you want.

But a historical Santa was Turkish.

CUTTER: St. Nicholas.

WEST: That's true. But no matter what color he is, he just loves the children. No matter what color they are. That's what's so magnificent about it.

James Brown had a song called "Santa Comes Straight Through The Ghetto." Why? Because sometimes, they were overlooked. The barrio, you go to poor whites, working class, brown, yellow, make sure you touch every child.

GINGRICH: Richard who works with us in makeup and makes us look better than we normally would had a great line. He said Santa Claus is what every child needs him to be, and the children get to define Santa Claus, not some TV commentator. I thought it was beautifully done.

WEST: That's well said. I just wish our public policy could reflect that in terms of the humanity of our poor children.

GINGRICH: Well, you do think sometimes at Christmas, there ought to be a greater capacity to slow down. And, you know, "The New York Times" series on the homeless children in New York City is really heartwrenching. It makes you just think how can a country this successful, this powerful, this wealthy, not find a way to bring itself together?

DOUTHAT: But it's -- I mean, Christmas brings out everyone's anxieties, though. That's the weird thing.

GINGRICH: Well, I want to thank Cornel West and Ross Douthat.

Go to Facebook or Twitter to weigh in on our "Fireback" question. Should job training be required to receive unemployment benefits? Right now, 68 percent of say yes, 32 percent say no.

CUTTER: The debate continues online at, as well as on Facebook and Twitter.

From the left, I'm Stephanie Cutter.

GINGRICH: From the right, I'm Newt Gingrich.

"ERIN BURNETT OUTFRONT" starts right now.