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CNN Today

Robert Reich: 'We Ought to Spread the Benefits of Capitalism'

Aired January 22, 2001 - 1:20 p.m. ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

LOU WATERS, CNN ANCHOR: Domestic policy no longer is the responsibility of Robert Reich, but it's still his passion.

Secretary Reich served under three U.S. presidents, most recently as U.S. labor secretary under President Clinton.

He's written eight books, the latest of which is this one, "The Future of Success."

Secretary Reich, or Professor Reich, whichever he prefers, joins us now from...

ROBERT REICH, FMR. LABOR SECRETARY: Your highness.

WATERS: Your highness...

REICH: Your highness to anything.

WATERS: ... OK...

REICH: How are you, Lou?

WATERS: ... in Washington today.

I guess you saw Phil Gramm and Zell Miller out there talking about tax cuts. Can you, in a nutshell, tell us what we saw there, and whether or not you think this is a good policy?

REICH: Well, it -- we're going to get some sort of a tax cut. I think that the Democrats are ready to do that.

The real question is how big the tax cut is going to be, and secondly, who is going to be the major beneficiary. Is it going to go mostly to people who have high incomes, or mostly to people who have more modest means?

WATERS: The surplus, where it's politics by surplus. Is this surplus deal -- is that -- is it real?

REICH: The surplus is -- well, it's an accounting of projection.

There is an inconsistency in Senator Gramm's statement because, on the one hand, if the economy really is slowing down, as much as he says, to the point where there does need to be a tax cut as a stimulus, then we are probably not going to see the big surpluses that are projected. Those projections assume that there will be not a recession or a big slowdown.

WATERS: Yes, there is almost a sense of urgency. What Zell Miller was saying, we need tax cuts now before the surpluses fritter away, as he put it.

REICH: Yes, well, you can't have it both ways. That is, you can't project a huge surplus and also expect, at the same time, that the economy is going to slow to the point where there are not going to be very many surpluses.

WATERS: OK, so we've got the tax proposal now before the Congress. I expect we can see a big fight about that.

I want to get to your book, though, which is titled, once again, "The Future of Success." And in it, you say that folks are getting richer but less happy in their lives. Explain that.

REICH: Well, the economy, Lou, has been remarkably robust and good for most Americans, not all Americans but most Americans over the past 10 years.

But the fact of the matter is that this year, the average American couple with children is working seven weeks more than they worked 10 years ago. So people are working more, they're working harder, they are under great stress.

And this gets back to the tax-cut issue. I would say, why not have a tax cut that benefits average working people the most, so that they can afford child care, they can afford health care, they can afford to go out and do a lot of the things they need in order to deal with the fact that they are working so much harder these days.

WATERS: You, also -- in your book, something that's considered your most controversial idea propose the nest egg, $60,000, for every 18-year-old.

REICH: Well, we -- a lot of people, they get to be 18, they get to be 20. They need funds both for college and also to invest in the stock market, or to invest in a business. And they don't have any way of getting on that escalator that, through most of the '90s, some people who were doing quite well are on.

And it is possible to give people a nest egg that they can use to save and also be capitalists. You know, capitalism is not a bad word. We ought to spread the benefits of capitalism and make investors of more people.

WATERS: I guess you may have seen the chief economist for the U.S. Chamber of Commerce, says it's typical, time-worn, left-wing, socialist proposals.

Do you -- what's your reaction to that?

REICH: You know, I disagree with that. I think that even the Bush administration will see that average working families do need some help. Their children need some help. Day care, child care, health care, good education. George W. Bush has already introduced new legislation with regard to schools.

And the issues here should transcend party lines. There should not be liberals or conservatives, certainly not calling each other names.

I don't suspect that my new book is going to become the bible of the Bush administration. But I do hope that it does provide some fodder for people to understand what working families need in this new economy.

WATERS: You hope, at least, they will read it.

REICH: Well, they'd better at least read it.

WATERS: OK.

REICH: And you, too, Lou.

WATERS: I will. I have it, I will.

And good luck in your new and relaxed life, Robert Reich, former labor secretary.

And the book, again, is called "The Future of Success."

Much success to you.

REICH: Thanks very much. Bye-bye.

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