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Is President Bush Talking Down the Economy and Talking Up an Energy Crisis?

Aired March 20, 2001 - 7:30 p.m. ET


BILL PRESS, CO-HOST: Tonight, charges that President Bush is talking down the economy.


GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: You know better than me that our economy is slowing down.


PRESS: And talking up an energy crisis.


BUSH: We got a problem with energy in America.


PRESS: Is he being realistic? Or is it just a ploy to sell his policies?

ANNOUNCER: Live from Washington: CROSSFIRE.

On the left, Bill Press. On the right, Robert Novak. In the CROSSFIRE, Congresswoman Nita Lowey of New York, chair of the Democratic Congressional campaign committee; and Congressman Roy Blunt from Missouri, Chief Deputy Republican whip.

PRESS: Good evening. Welcome to CROSSFIRE. They call him the maestro, but today, not even the maestro could orchestrate a recovery. Fed chairman Alan Greenspan cut interest rates but still the market tumbled, raising fears not only of a bear market, but of an actual recession -- with predictable political reactions.

President Bush said the shaky economy proves the need for his tax cut. The Democrats say it's all his fault. The market would still be strong if he hadn't been so negative in his public comments.

On energy, the opposite debate is raging. Reacting to California blackouts, Energy Secretary Spencer Abraham warned the entire nation faces an energy crisis that could change people's lives. Democrats counter that he and Bush are just trying to scare Congress into supporting new drilling up in the Alaskan wilderness. So tonight, two fronts: Is Bush talking down the economy? Is he talking up the energy crisis? Or is he telling the truth about both?

Back tonight as guest host on the right: former New York Congressman Rick Lazio.

Rick, get to you in a minute, but first a couple questions here for Congressman Blunt. Congressman, George Bush said something the other day that I actually agree with, believe it or not. He said it is the role of the president to lift the spirit of the country. Now, with that in mind, I'd like you to hear a few things the president has said recently about the United States economy. Here he is.


BUSH: Americans are hearing, and some feeling, the economic slowdown.



BUSH: We got a issue with our economy.


BUSH: Our economy is beginning to sputter.


PRESS: Every time we turn around, this guy is bad-mouthing the economy. Is that lifting our spirit or dumping on it in order to sell his tax cut?

REP. ROY BLUNT (R-MO), CHIEF DEPUTY MAJORITY WHIP: Well, I think the president's been very uplifting in the way he's conducted himself so far, the things he's been talking about, the way he's got his plan started. You've got to be realistic about things like energy and the economy. And the president didn't do anything to see those flattening-out quarters, the last six months of last year. This president wasn't president yet, wasn't talking about this issue. For him to ignore this, some say, if his father would have reacted a little more quickly in the first year of his presidency, that that flattening-out of the economy that occurred wouldn't have occurred, wouldn't have been as bad.

And energy -- I mean, all the evidence is there in California. This is a real problem. We need to react to that problem, we need to restore some sense of what's going to happen in the country over the next two or three years. That's what the president's doing. I think we're going to join him in doing that and make a difference.

PRESS: Well, let's stick to the economy for now, because the fundamentals are still strong. It's sort of like the glass half full or half empty. I mean, unemployment's still down to 4.2 percent, Labor Department says 135,000 new jobs created in February, retail sales are still pretty strong. Maybe the problem is that Bush really wants a look at the dark side.

Let me -- listen, if you would, please, to something that Senator Dick Durbin said on Friday, which I think puts it in perspective.


SEN. RICHARD DURBIN (D), ILLINOIS: Despite the advice of Chairman Greenspan and economists that we need to restore consumer confidence, the president has talked down the economy in an effort to talk up his tax cut. It appears that when President Bush looks at the economy he doesn't see the donut, he just sees the hole.


PRESS: That's it. All we hear is the bad stuff from him. You never hear the good stuff.

BLUNT: I think what you hear from him is a realistic appraisal of where we are and what we need to do about it.

PRESS: It's that bad?

BLUNT: You look at the last two months of last year -- the last two quarters, rather -- and for the first time in over a decade, the economy had flattened out. The stock market began to react to that really late last year. The president's really only talking about the facts, and the facts right now need some attention. We could ignore this until it became a problem that was unsolvable in the short term, just like the energy crisis is now unsolvable in the short term because it was ignored so long.

The president's not willing to do that. I think the country is very confident in his leadership. I think he does lots of optimistic, positive things. One of those is talking about what we can do to get this economy going again, and not have a real economic problem out there if we ignore the facts of the last two quarters of last year.

RICK LAZIO, GUEST CO-HOST: Congresswoman Lowey, how are you?

A pleasure to be with you.

PRESS: You two New Yorkers. Give me a break.

LOWEY: I'll even wait for your question before I answer.


LAZIO: You're the chief of the Democratic Congressional Campaign Committee, so you're in charge of electing Democrats. And the spin is in full gear right, isn't it?

George Bush is being accused of using straight talk to push his agenda. It's all a product of vast right-wing conspiracy. Let's look at what President Bush said today in explaining why honesty is the best policy.


BUSH: This is going to be a very practical administration. We will view problems, analyze them, and deal with them. We'll be as up front as we can with the American people. We'll explain when we can get something done quickly, and we'll explain when we can't get something done quickly. We're not going to shirk from the problems with which we're confronted.


LAZIO: Isn't it a pleasure to have a president who talks honestly with the American people?

REP. NITA LOWEY (D), NEW YORK: Rick, I'm hoping that this president can talk up the surplus as well he has talked down the economy. In fact, I find it extraordinary, whether it president, or the Prime Minister Cheney, whether it was in December or January of February...


LOWEY: We've seen the economy change. We had a healthy economy. People were working. We have never seen such a robust economy. Suddenly, Dick Cheney and this president have been causing things to go down in a tailspin. In fact, the day that the House voted for the tax cut, the stock market had its biggest tumble.

And you talk about energy policy. With respect for my good friend, the president has said: "OK, California, you take care of yourself," and I haven't heard him say anything except predict a crisis in New York. I think all this business of an energy crisis without any leadership from the president is an excuse for the president to go drilling in ANWR our most precious resource, rather than show some leadership in a real policy.

LAZIO: Let's cut through the spin and get right to the facts on the economy, and where we've been over the last year. Because if you look at the numbers first -- let's look at Nasdaq, where Americans are investing -- almost half of Americans are investing in the economy. During the Clinton year, this last year, dramatic drop in the Nasdaq. If you look at economic growth, it didn't just begin to deteriorate when George Bush was president. It began to deteriorate under the watch of Bill Clinton. As a matter of fact, you had a dramatic decline in the third and fourth quarters of last year. See the numbers up there right now.

The question is: Wouldn't it have been the right thing for Democrats in Congress to support the Republican initiatives to lower taxes back then so that tax relief would have been helping the economy right now?

LOWEY: Rick, let's look at this tax cut. First of all, the president proposes $1.6 trillion tax cut. The Republicans in Congress in the House don't even think that's big enough. Every special interest is walking the halls of Congress. We want a special interest for this corporation, for that corporation -- we want a break, an additional tax break.

LAZIO: But last year...

LOWEY: And in fact...


LOWEY: In fact, Rick, I just want to say that if you look at this tax cut that's being proposed, 2/3 of it doesn't even happen until the year 2006. So, come on, this tax cut won't have any impact, and the people are pretty smart. If you look at consumer confidence rates now, it's pretty high. If you look at what they're predicting for the future, it begins to go down, because they don't have any confidence in this president's tax cut, in his policies. They want to see a budget. They want to know that we can have a reasonable tax cut while rebuilding our schools, while keeping our parks clean for the next generation, preserving our air and water...

PRESS: I can see you want to jump in, Congressman. Go ahead.

BLUNT: Let me just say a couple of things, here. One is, if you don't want to cut taxes, there's always a reason not to do it. A tax bill that I think Rick and I both voted for a couple years ago -- $792 billion over 10 years -- we're barely into that 10 years now. It was too big, it was irresponsible. It was -- there's really nothing wrong with the pieces of it as I recall at the time. It was just too big.

Now everybody says: "Oh, if we only had a $900 billion tax cut for this 10-year period." When the last time we a tax cut on the table, it was 792, and it was too big, There's always a reason for some people not to want to cut taxes. The tax cut is not a problem.

You know, I thought that we would see the president have to be blamed for the economic slowdown about a year from now. Never really occurred to me that within 60 days becoming president, he'd be blamed for that dive in the Nasdaq that the chart that was put up a minute ago showed happening beginning last July.

PRESS: Well, I want -- I want to talk to you about that market, because I'm an investor in the market. I still think it's the place to be. And like a lot of investors, you know, you look to this administration for leadership. You look to them for reassurance. You look for them to confidence in the market. Again, I think it's the president's job and the rest of his administration.

So yesterday, here's the treasury secretary, Paul O'Neill, out there on the stump, and he gets a question from the audience. Tell us about the market. OK. Everybody is listening. Here's what Paul O'Neill has to say.


PAUL O'NEILL, TREASURY SECRETARY: I want to say something about the markets. I think the markets go up and the markets go down. And if you've been watching them as long as I have, you know that and you anticipate that. And it's not clear to me that there's some high utility in me noticing every day what's going on.


PRESS: Congressman, that makes me want to go out -- I want to go out and slit my wrists when I hear that. I mean, what is this guy?

BLUNT: I think...

PRESS: Market goes up, market goes down. Duh!

BLUNT: He was saying just what you said, Bill: You stay in the market, you don't watch it every day. I think that was actually a positive thing.

PRESS: But he exuded no confidence in the market at all.

BLUNT: Well, now, his presentation style, you would be much better at judging that than I would. I think what he was saying you invest in the market for the long term, and if you're in the market for the long term, I don't think anybody in that kind of market has any concern right now, particularly if we enhance the economy with some tax relief from the tax overcharge that the American people have sent the federal government.

LOWEY: Just if can you explain to me how the tax cut will have any impact if two-thirds of it doesn't even take effect until the year 2006. And I think we in the Congress can be cavalier -- and maybe Bill Press can -- and leave the money in and let it go up and down. But I was talking to someone just the other day -- I was getting a haircut -- who saw his whole lifesavings go, because so many of the people who are barely making ends meet are now investing in the market. And they can't sit it out. So they were beginning to sell, and that's when hysteria sets in. And then they hear the president saying, oh, it's going to go down, it's going to go down, it's going to go down.

BLUNT: Well, a tax cut over a 10-year period has the ability to restore the economy...

LOWEY: Their savings are gone...

BLUNT: ... has the ability to restore the economy...

LOWEY: Ten years from now?

BLUNT: ... if you don't follow this silly idea of a trigger.

If people know that the tax cut they're going to get in their business or in their home income is a tax cut they can plan on. If you know that your small business is going to go from 39 1/2 to 33 percent in taxes, not 39 1/2 to 37...

LAZIO: And that's what Alan Greenspan -- that's what Alan Greenspan says.

BLUNT: Absolutely. LAZIO: Isn't this also part of a take-no-prisoners political strategy?

You know, when I was in the Senate race, Nita, I said the upstate New York economy had begun to turn the corner, but that we needed to do more. People on the left piled me on, saying, oh, Lazio's a pollyanna, he's not realistic.

And now we see that it looks as though the tables have turned and that it's the left now who's trying to paint George Bush as out of touch.

Let's go look for a minute at what budget chief Mitch Daniels said on Sunday.


MITCH DANIELS, WHITE HOUSE BUDGET DIRECTOR: They're probably disappointed that the president is talking plainly and associating himself with the difficulty that some Americans are experiencing. They would have liked it better if he had indicated an indifference or not talked about it. Then, they could have accused him of being out of touch.


LAZIO: Telling the truth shouldn't be a liability, should it?

LOWEY: You know, Rick, to me this is bigger than just which team is going to win, the Democrats or the Republicans. When I visit schools in districts in the metropolitan New York area, I see roofs that need replacing. I see kids in classrooms, when it rains, they have to run from one end to the other. I visit classrooms where they don't have enough computers.

If we don't have a total budget, how can we provide for tax cuts, continue to pay down the debt, continue to invest in education and health care and preserving our park? It's a good thing that we didn't follow the George Bush plan on preserving Social Security and invest part of it in the stock market.

LAZIO: That was the same argument that was made...

LOWEY: Those savings would...


LAZIO: That was the same argument that was made when we paid down the debt and lowered taxes a couple of years ago.

PRESS: Time to take a quick break here, and we'll move on from the economy when come back to energy. The president's been accused of talking down the economy. Is he also guilty of talking up an energy scare?


LAZIO: Welcome back to CROSSFIRE. I'm Rick Lazio, sitting in on the right.

More bad news this week on energy shortages and a continuing stock market decline. Is George Bush telling the American people what they need to hear or has he created a crisis in order to sell his agenda?

Joining us to debate those questions tonight: Congressman Roy Blunt of Missouri, chief deputy majority whip, and Congresswoman Nita Lowey of New York, chair of the Democratic Congressional Campaign Committee.

LOWEY: Unfortunately, Rick.

LAZIO: But you know...

LOWEY: Unfortunately, Rick, I haven't seen any leadership on the part of George Bush. He is saying to California you take care of yourself, and then he's announcing that there's going to be an energy crisis in New York, which brings me back to the good old days when he said drop dead, New York.

What is the plan?


In fact, Spence Abraham, the secretary, wanted to do away with the Department of Energy. Do you remember that, Rick?

LAZIO: But you know, here's what I want to know: You have blackouts that are creating confusion and concern in California. But soon, coming to a city near you, maybe New York, blackout. Are we going do wait until we see the Statue of Liberty dark or the Empire State Building before we begin to do something about it? Don't we want leadership? Don't we want to get in there and begin...

LOWEY: You're right.

LAZIO: ... to create the generation capacity...

LOWEY: You're right.

LAZIO: But where have the Democrats been?

LOWEY: Where is -- where is the president of the United States? He was going to be cheery -- and he is -- and he was going to keep our optimism up. What kind of optimism is it to say, New York, you're going to have a crisis, California go handle it yourself? The only solution I have heard, and I think this scaring is probably a good rationale for what he considers the best solution, go dig in ANWR, our precious resource. Where's the leadership?

LAZIO: Wasn't the Clinton administration MIA on energy? Let's look for a minute at what energy -- former Energy Secretary Bill Richardson had to say in a moment of honesty: "It is obvious that the federal government was not prepared. We were caught napping. We just got complacent."

LOWEY: Well, Bill Richardson, may have made some statements which I felt were not correct, but, in fact, many of us have been work on this issue for a long time, and that is conservation, making sure we preserve our precious resources. The person who wasn't appointed president, in fact, Al Gore has been talking about energy policy a very long time, and conservation is really at top of it. I don't see any leadership.


PRESS: Let me bring you into this with a question, if I can, because I'm from California and I know the situation out there pretty well. I mean, what happened is Pete Wilson signed a bill. It was a bad bill, everybody was for it, Democrats and Republicans, in 1998 that deregulated one side but not the other side. The utilities could not charge any more money.

And now, you have Spencer Abraham, our energy secretary, out there saying -- I won't play you the whole byte because we're almost out of time -- saying that this is a crisis that's going to change everybody's lives in the United States of America. I mean, just because of Pete Wilson's dumb mistake doesn't mean you're going to have lights out in Manhattan. Isn't he exaggerating this?

BLUNT: Well, there really has been 10 years of neglect here. Whether it's alternative fuels, that kind of research, our relationship with our allies and our trading partners, that unfortunately, we get 60 percent of our oil from now. This was really an item of negligent in the Clinton administration.

And if I watched the news right yesterday, I don't think the president could time this blackout. Spencer Abraham and the president and others were meeting to try deal with this energy crisis while California is having blackouts because of air conditioning in March. There is a big problem. It didn't occur right now. This president is trying hard to solve it. He was meeting to come up with a policy after eight years of no policy at the very time this happened.

PRESS: Let me just say this, and I may disagree here with my friend, Nita, that I agree. I don't think any administration has had a rational energy policy since Jimmy Carter, to tell the truth. The problem with this administration is you hear nothing about alternative sources, nothing about wind, nothing about solar, nothing about fuel cells, nothing about conservation. All you hear about is drilling in ANWR. That is not the answer. It cannot be a one pony show.

BLUNT: You know, this administration has been in for almost 60 days now and that they don't have an energy policy that reverses the -- you say the neglect since Jimmy Carter, I'd say certainly the neglect of the last eight years in 60 days.

I think we have to wait and see what they're going to produce. They are working hard to do that. The vice president is working on it. Spence Abraham is working on. The president yesterday was talking about this when really -- when you have air conditioning crisis in March, you've got a huge problem.

PRESS: We've got a problem because we are out of time and we just always want more action. Congressman Blunt, thank you for being here. Congresswoman Nita Lowey, good to see you here.

LOWEY: Always a pleasure. Nice seeing you.

PRESS: And when we come back, closing comments. I'm going to tell you exactly what President Bush has to say to get this economy rolling again and Rick Lazio is probably even going to agree with it. Stay tuned for closing comments. |


LAZIO: It just kills the left, Bill, doesn't it, that you have a Republican, conservative president with soaring popularity talking straight with the American people, an economic plan to get the economy rolling again, and all the left can do is to try and smear him and drag him down?

PRESS: No, here's what gets me is that you have a president who is supposed to be a cheerleader and he sounds like a mortician. I mean, he's always around here saying how bad things are. My advice for President Bush, I think would help the economy a lot is if you can't say something positive, don't say anything at all. That's my grandmothers' advice. Say something positive or keep your mouth shut.

LAZIO: What he's saying is put the people's money back in their pockets, let them spend it, get the economy rolling. Let's acknowledge the energy crisis. Let's not put our head in the sand. Let's not do what we've done for eight years under the Clinton administration.

PRESS: He should say the economy is strong. From the left, I'm Bill Press. Good night for CROSSFIRE. I'll see you later in "THE SPIN ROOM."

LAZIO: And from the right, I'm Rick Lazio. Join us again tomorrow night for another edition of CROSSFIRE.



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