CAN’T WAIT TO SEE YOU AT 2 P.M.
CHARLES PAYNE.
LET’S GO TO FRANCIS NEWTON STACY
ON THIS, CAPITAL DIRECTOR OF
STRATEGY, JON HILSENRATH WITH US
AS WELL, WALL STREET JOURNAL
GLOBAL ECONOMICS EDITOR, FOX
NEWS CONTRIBUTOR, FOX BUSINESS
CONTRIBUTOR, YOU NAME IT.
JON, THIS IDEA THAT WE’RE
RUNNING A DEFICIT LIKELY OF $2.3
TRILLION, THAT’S WITHOUT
STIMULUS -- SO, OBVIOUSLY, WILL
ADD SIGNIFICANTLY TO THAT WITH
STIMULUS -- NO ONE SEEMS WORRIED
ABOUT IT.
MAYBE DOWN THE ROAD THEY’LL BE
WORRIED ABOUT IT.
YOUR THOUGHTS.
>> WELL, FIRST OF ALL, I’M
HOPING YOU GUYS CAN TELL ME
WHERE THESE MONEY BOOTS ARE AND
HOW I CAN GET INSIDE ONE OF
THEM --
[LAUGHTER]
I’VE JUST BEEN HOLED UP AT HOME
FOR A LONG TIME.
YOU KNOW, NEIL, YOU’RE
PROBABLIES ALSO TOO YOUNG TO
REMEMBER BACK -- PROBABLY ALSO
TOO YOUNG TO REMEMBER BACK IN
THE ’90s WE HAD THIS IDEA OF
BOND MARKET VIGILANTES, RIGHT?
WHENEVER WE GOT BAD DEFICIT
NUMBERS OUT, INTEREST RATES
WOULD GO UP, AND THERE WAS A LOT
OF PRESSURE ON WASHINGTON TO
DEAL WITH BUDGE DEFICITS, AND
THAT’S WHY GEORGE H.W. BUSH AND
BILL CLINTON DID, BECAUSE THE
MARKET DEMANDED IT.
THE MARKET DOESN’T DEMAND IT
NOW, AND AS LONG AS THE MARKET
DOESN’T DEMAND IT, WASHINGTON’S
NOT GOING TO DO IT.
CHARLES IS RIGHT, IT’S A MONEY
BOOT, AND THEY’RE GOING TO KEEP
GOING.
WHAT I’M WATCHING IN THIS DEBATE
RIGHT NOW, WHAT’S HAPPENING WITH
THAT MINIMUM WAGE.
BECAUSE THAT TELLS ME SOMETHING
ABOUT HOW MUCH INFLUENCE THE
LEFT IS HAVING ON POLICY BECAUSE
YOU CAN HAVE A REAL DEBATE ABOUT
WHETHER THE MINIMUM WAGE IS
COUNTERPRODUCTIVE OR HELPFUL TO
LOW INCOME HOUSEHOLDS.
YOU COULD ARGUE THAT WHEN YOU
RAISE THE MINIMUM WAGE, IT GIVES
COMPANIES A DISINCENTIVE TO
HIRE.
THE LEFT IS PUSHING HARD FOR IT,
AND, YOU KNOW, THAT’S THE WAY
THIS IS GOING, THAT TELLS YOU
THAT THE LEFT IS WINNING THESE
DEBATES.
NEIL: YOU KNOW, THAT’S AN
INTERESTING ARGUMENT, FRANCIS,
BECAUSE AS SOON AS I HEARD THIS
OUT OF NANCY PELOSI, WE’RE
SENDING THAT $15 MINIMUM WAGE
THING, YOU KNOW, TO THE SENATE,
I COULD JUST IMAGINE JOE BIDEN
SAYING, REALLY?
I MEAN, DO WE HAVE TO BE DOING
THIS RIGHT NOW IN.
>> WHAT ARE WE LOOKING AT WITHIN
THE DEMOCRATIC PARTY?
THERE’S GOING TO BE AN
AGGRESSIVE BACK AND FORTH ON
THIS.
I DON’T THINK THIS’LL END
PEACEFULLY.
I DON’T THINK IT’LL DISRUPT THE
STIMULUS, BUT I DON’T THINK IT
WILL NOT REVEAL SOME INTERNAL
FIGHTING.
>> NO, IT’S ABSOLUTELY TRUE.
THE $15 MINIMUM WAGE IS THE
JUSTIFICATION FOR THE INFLATION
BEING CAUSED BY DUMPING ALL THIS
STIMULUS INTO CIRCULATION
BECAUSE PRICES ARE GOING UP.
I MEAN, LUMBER HAS GONE UP
MULTIPLE HUNDREDS OF PERCENT,
FOOD COSTS HAVE GONE UP AT LEAST
12%, IN SOME CASES UP TO 40%.
SO WHAT’S HAPPENING IS YOU’RE
HAVING THE BOTTOM OF THE
K-SHAPED RECOVERY WHERE THE
PEOPLE WHO ARE NOT BENEFITING
FROM THE STIMULUS NOT ONLY ARE
THEY HURTING FROM A LOSS OF
EMPLOYMENT, BUT THEY’RE HURTING
FROM AN INCREASE IN A COST OF
LIVING.
AND SO THE BAND-AID APPROACH TO
THAT IS TO RAISE THE MINIMUM
WAGE TO $15.
THE PROBLEM WITH IS YOU DO
STIFLE THE RECOVERY BECAUSE THIS
IS A BAD TIME TO PUT PRESSURE ON
BALANCE SHEETS WHEN YOU HAVE A
LOT OF COMPANIES, BECAUSE OF THE
PANDEMIC, ON THE BRINK OF
BANKRUPTCY.
NEIL: YOU KNOW, GUYS, WE’RE
GETTING SOME, YOU KNOW, DETAILS
ON WHAT THE PRESIDENT IS TELLING
THESE MAYORS AND GOVERNORS, AND
ONE OF THEM THERE IS A NEED
RIGHT NOW TO HELP STATES WITH
UNEMPLOYED PEOPLE AND OPENING
SCHOOLS.
SEPARATELY HE SAYS, JON, HE
WANTS TO KNOW MORE FROM
GOVERNORS AND MAYORS WHAT THEY
NEED IN THIS COVID RESCUE PLAN.
WELL, TO A ABOVE AT LEAST -- I
DON’T KNOW ABOUT THE MAYORS, BUT
CERTAINLY TO A GOVERNOR, THEY
WANT HELP.
AND THE MORE MONEY THE BETTER.
AND I SUSPECT THERE IS THIS
ANXIETY AMONG REPUBLICANS WHO
SAY, WELL, YOU’RE ACTUALLY
BAILING OUT GOVERNORS WHO, YOU
KNOW, HAD A HISTORY OF PROBLEMS
IN THEIR STATES, AND THEY WANT
TO BE BAILED OUT FROM THAT.
I MIGHT ADD THAT A COUPLE OF
REPUBLICAN GOVERNORS ARE AMONG
THOSE WHO ARE REQUESTING SOME
AID MAYBE FOR DIFFERENT REASONS.
BUT MY POINT IS THAT SEEMS TO BE
A MOVING TARGET THAT GETS A ROT
MORE EXPENSIVE. -- A LOT MORE
EXPENSIVE.
WHAT DO YOU THINK?
>> YEAH.
THERE’S A COUPLE OF THINGS TO
PULL APART HERE.
ONE IS THAT WHEN YOU LOOK AT
STATE AND LOCAL BUDGETS, THERE
WAS A LOT OF FEAR LAST YEAR THAT
THEY WERE GOING TO, THAT THESE
BUDGETS WERE GOING TO COLLAPSE
BECAUSE THERE WAS SO MUCH STRAIN
ON THE RESOURCES FOR EMPLOYMENT
BENEFITS, MEDICAID AND THINGS
LIKE THAT, AND THEY DEPENDED ON
SALES TAX REVENUES WHICH WERE
BEING HIT.
WHAT HAPPENED WAS THEY WEREN’T
HIT AS HARD AS A LOT OF PEOPLE
EXPECTED.
PART OF THAT WAS BECAUSE THEY
DID GET A LOT OF FEDERAL AID
LAST YEAR, BUT IT WASN’T AS BAD
A CRISIS AS PEOPLE EXPECTED.
SOME ECONOMISTS SAY, WELL, MAYBE
IT’S GOING TO HAPPEN THIS YEAR
INSTEAD OF NEXT.
SO, FRANKLY, I JUST DON’T KNOW
HOW DEEP THAT STRAIN IS RIGHT
NOW.
IN TERMS OF THIS IDEA OF
PROFLIGATE STATES AND LOCAL
GOVERNMENTS, FOR A FEDERAL
LAWMAKER TO MAKE THAT ARGUMENT,
IT’S KIND OF LAUGHABLE BECAUSE
STATE AND LOCAL GOVERNMENTS HAVE
TO BALANCE THEIR BUDGETS.
THEY HAVE RAINY DAY FUNDS.
THE FEDERAL GOVERNMENT IS
RUNNING UP TRILLIONS AND
TRILLIONS OF DOLLARS OF DEBT
EVERY YEAR, AND FOR THEM TO BE
CALLING OUT STATE GOVERNMENTS,
LIKE I SAY, IT’S KIND OF A JOKE.
NEIL: ALL RIGHT.