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YOUR BOTTOM LINE
The Fight for Undecided Voters; Getting Tough on China
Aired October 27, 2012 - 09:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CHRISTINE ROMANS, HOST: Thanks, guys. See you at the top of the hour.
Good morning. I'm Christine Romans.
Ten days until the election and polls show a dead heat. Still undecided voters out there, President Obama and Governor Romney spending millions to get their vote, especially in battleground states.
Check out this CNN electoral map. The states in yellow are up for grabs. Blue are safe for Obama. Light blue, leaning Obama. Red, those are safe for Romney. And light red leaning Romney.
But what will it take to win over those undecided voters, what do they want to know?
"Saturday Night Live" had this take.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Before you get our vote, you're going to have to answer some questions. Questions like --
UNIDENTIFIED MALE: When is the election? When do we have to decide?
UNIDENTIFIED FEMALE: What are the names of the two people running? And be specific.
UNIDENTIFIED MALE: Who's the president right now? Is he or she running?
(END VIDEO CLIP)
ROMANS: But in real life, undecided voters sound like this.
(BEGIN VIDEO CLIPS)
UNIDENTIFIED FEMALE: I want there to be continued job growth.
UNIDENTIFIED FEMALE: I don't care. Don't say Republican, don't say Democrat, just get it done.
UNIDENTIFIED FEMALE: I have not heard anything other than this tough guy rhetoric, and numbers that don't add up.
UNIDENTIFIED MALE: It's really critical right now, to make the best decision.
UNIDENTIFIED MALE: A lot of people need relief, and I'm not too sure the election is going to give it, no matter who gets elected.
(END VIDEO CLIPS)
ROMANS: Wow. I hope he's wrong. We're taking you across the country this week.
CNN's chief business correspondent Ali Velshi is in Orlando. He's on a battleground bus tour this week and next week, rolling from Florida to Ohio.
And our Miguel Marquez joins us from Denver. He's been traveling all over the Midwest and the western U.S. talking to voters. He was just in my home state of Iowa.
Let's start with Ali. You know, the economy still the most important issue for Americans. A CNN/ORC poll shows 48 percent, Ali, of registered voters put the economy at the top -- budget, health care, education, all of them up there.
What are you hearing from the undecided voters? What is going to make them make up their mind?
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Well, let's just be fair. They're a small piece of the pie. But if you're in Florida or you're in Virginia or you're in Ohio, states that are not decided, you could actually decide this election.
And what these undecided voters seem to want is specifics. They don't want the promises they have been through the last four years. They're prepared to do the hard math. They want to see the actual equation.
So, they don't want to hear 12 million jobs in four years, they want to hear exactly how you create 12 million jobs in four years. They don't want to hear tax cuts or 1 million more manufacturing jobs, they want to know specifically how you're going to do it.
From Mitt Romney, they want to see the math. And from Barack Obama, they want to see, hey, you couldn't do this for the last two years, you did say it was because of Congress, but what happens if you end up with the exact same congressional makeup? What is it you're going to do differently now that you didn't do before?
ROMANS: I want to go to Miguel quickly. You know, you're right there in Colorado, Miguel, where the unemployment rate is higher than the national average, 8 percent. It's higher than the national average. You were just in my home state of Iowa where the rate is 5.2 percent.
So, on paper, people in Iowa should be less worried about unemployment than people in Colorado. But you know what? All across these swing states, people are worried about opportunity, they're worried about future jobs and the quality of jobs they have right now.
MIGUEL MARQUEZ, CNN CORRESPONDENT: Oh, absolutely. The big thing, sort of what Ali was talking about, politics are emotional. What people can't see is what the future is. They can't see where Barack Obama's going to take the nation. They can't see exactly where Mitt Romney's going to take the nation.
We've talked to voters across the battleground states. And in some places there's not so much undecided as they have a soft preference for one or the other. They sort of like this one, but could go over to the other one.
My guess is a lot of people don't end up voting on Election Day and it comes down to the battleground states and getting people out to vote and which campaign has the most organization on the ground to get them to the polls to vote.
ROMANS: It's so hard also to sort of judge, guys, I think what the unease is, that people even with jobs have right now. We've got a new survey out this week that found that 34 percent of middle class Americans, they think their retirement income will be 50 percent or less of their current income.
Median income in this country is about 50 grand. Do the math. You can't live on half of $50,000 in retirement. You can't.
The same survey found middle class Americans believe their out-of- pocket health care costs will be about $47,000 in retirement. Most estimates put it much, much higher than that. A quarter of Florida's population is over the age of 60.
Which issue specific to older Americans are you hearing about in Florida right now?
VELSHI: Well, there are three. The first one, of course, is Medicare. They want to understand this better. And this is the one area they're just not that clear on. And, of course, some of them are saying, just don't touch it.
Others are concerned about Social Security, and whether that will remain solvent.
But the other issue you have to keep in mind, some of these people have investments, either savings, which they're not earning any money on, or actually stock market investments on which may have taken a big hit in the last few years.
So, they also want this president, who is going to be for an economy, who is going to help America stay stable, and have the stock market grow. Because some of them have 15 or 20 or 25 more years to live and they want to know they'll have enough money to pay those bills you're talking about.
ROMANS: And, you know, Miguel, each state has its own thumbprint, if you will. And I guess as you go from place to place, are you finding that the pundits and politicians may be saying, what people are feeling around the country, but people have a different view of things than you're getting I guess 50,000 feet? MARQUEZ: But people have a different people have is, OK, both these candidates may be fined, they both have great plans. But how are they going to get it done in such a partisan environment.
They saw a hellish recession. They've lived through that. They saw Barack Obama come into office with this great hope, and sort of this sweeping mandate of change.
They saw it get bogged down in politics and they're not entirely sure another four years with Obama is going to fix it, but they're equally unsure whether four years of changing track with Mitt Romney is going to change it. So you have people, like me, like you, like just about everybody, caught in the middle. What is the right way to go?
ROMANS: All right. Miguel in Denver, we'll continue to watch your travels. Really great work this week, Miguel.
And also, Ali Velshi, in a few hours, we'll up on "YOUR MONEY," and we'll be talking more about Florida and these swing states. Nice to see you, Ali.
All right. Up next, China, a dominant topic at this week's presidential debate -- we're going to tell you whether China is more threat or opportunity.
But first, there are more than 1.3 billion people in China. That makes up what percentage of the world's population? Is it (a), 9 percent, (b), 19 percent, (c), 29 percent? No Googling. I'm going to tell you on the other side of the break.
ROMANS: Nineteen percent of the world's population lives in China. It's the biggest foreign holder of U.S. debt.
It dominated the conversation at the week's presidential debate on foreign policy. Both candidates had a lot to say on China on the campaign trail.
CNN's Tom Foreman fact-checks their claims.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We're going to insist China plays by the same rules as everybody else.
MITT ROMNEY (R), PRESIDENTIAL NOMINEE: In part by holding down artificially the value of their currency, it holds down the prices of their goods, it means our goods aren't as competitive and we lose jobs. That's got to end.
TOM FOREMAN, CNN CORRESPONDENT: The pledge from each candidate is clear, I will crack down on China, but can they do that and do they have their facts right? But let's look at the numbers first.
Are we losing jobs to China? Yes, we are, about 2.75 million over the past dozen years, many of them manufacturing jobs. If look at this map from the Economic Policy Institute, you can see that it's not even all over the country.
The places with the darker orange color on a percentage basis have lost more jobs to China. So you have Oregon and Texas -- and look at California over here, 3 percent of their jobs in the past dozen years lost to China.
The candidates say this is largely happening because while America allows its value of the dollar to be set by the free market and that determines the cost of labor, that China manipulates the cost of its currency, the Yuan, so it can control the cost of labor because they have a lot of people they need to employ. They'd like to keep labor costs low to attract a lot of business.
Now, it is difficult to do a one to one comparison because productivity is very different between the U.S. and China. But let's look at this way as much as we can. If you had a U.S. factory and you wanted to produce something there, by the time you paid a laborer all the benefits, all the salary and everything else, that's going to come out to about $34 an hour.
To do the same thing in China, it is more like $2 an hour. So the Chinese government has structured its infrastructure and everything else to support this idea, to bring factories in, to take advantage of that cheap labor and to put inexpensive products out to compete on the world market. And, boy, does it compete.
Look at this graph, showing what has happened since 1985. This is how many Chinese products we were importing in 1985. And it has gone up and up and up and up so that -- this is a recession right here, by the way, that little dip there -- it's now reached levels up here, dropped down a little bit more, but tremendous increase in the number of Chinese products coming into the United States since 1985.
But now look at what we're sending over there. U.S. products in 1985 were about even with Chinese and now not nearly as much. It is far behind.
What can a president do about that? Well, they could put some kind of a trade barrier in place to stop the Chinese imports.
But if they did that, China would probably respond with trade barriers to U.S. products going there. They could say to U.S. companies, you can't go over there and take advantage of the cheap labor.
But if that happens, those companies at a greater disadvantage on the world market, on top of which, you have to remember China has been buying a lot of U.S. debt. If China stopped doing that, it could make it hard for the government to borrow money to keep operating.
ROMANS: I'm joined now by Peter Navarro, professor of economic policies at the University of California, Irvine. He's also the director of the documentary film "A Death by China." That was a fantastic analysis by Tom Foreman. And there are more dimensions to this trade situation. Just flat-out government subsidies of an industrial complex there, military complex in China, right?
You also have vast, vast levels of stealing, intellectual property theft, huge concerns the American government is on record about. That goes beyond the currency issue, which you heard a lot about in the debate. And the wage issue, Peter.
So you've got five or six different levers here with China, and at any one time the president's only moving one of them.
PETER NAVARRO, PROFESSOR, UNIVERSITY OF CALIFORNIA, IRVINE: Yes. You know, the one thing I would add to Tom's analysis is, sure, China has cheap labor, but my research indicates that the far bigger advantage that China has in the world market is from everything else it does, and that includes, as you indicated, the currency manipulation. Huge, huge, huge illegal export subsidies, the theft of our intellectual property, the right in China to put anything you want in the water or air. And basically, labor conditions which are essentially indentured servitude.
So, there are a lot of moving parts. The question, of course, is what do we do from a policy point of view?
Now, the Romney proposal to crack down on Chinese currency manipulation is interesting, because it was the same thing Obama promised in 2008 that he didn't deliver on. Is it a good idea?
Well, the advantage of that is simply if you brand China a currency manipulator, it gives you the right to impose countervailing duties. If Chinese currency really is undervalued by 20 percent, 25 percent, 30 percent, you would be able to put tariffs on Chinese goods, which would help all industries.
The other thing I would say about Tom's analysis, is this whole thing about we only lost 2.5 million jobs. That's just dead wrong. It's a lot more than that, because since China entered our market, Christine, in 2001, our growth rate has dropped by two-thirds. And we've been failing to create 2 million jobs a year, over 20 million --
ROMANS: And the wages, some argue the wages of the jobs we have been stagnant. And some say that is directly related to globalization --
ROMANS: Not just China, but China the biggest player.
But let point from White House -- let me bring in a White House defense here, because the president pointed out in the last debate that the dollar is right now at its most advantageous for exporters to China since Obama came to office. He actually said the most since 1993, I think, that we're moving in the right direction.
They have let this currency float a little bit in that band. Isn't that a sign of progress, that the Chinese are listening?
NAVARRO: Well, let's see. Let's look at that claim. First of all, it's a very parochial claim by the president. He doesn't really see the big global picture.
Here's the problem, yes, the Yuan has gone up some. But the dollar's gone down more over the last two years. So that fits peg to the dollar by China is actually hurting every other country in the world, including Europe, which is in the tank. So that's number one, when you talk about the president's view on that.
The second thing is, if you look at when the president took office, Christine, the trade deficit with China has grown every single year and is now going to breach $300 billion. Over the course of his term we've added over $1 trillion in debt to China.
And the bottom line here is that China's currency won't be properly valued until we don't have a trade deficit with China.
ROMANS: Peter Navarro, we're out of time, but we'll talk about it soon. Great having you on again.
NAVARRO: Thanks so much, Christine.
ROMANS: All right. I want to know how you can make $70,000 a year with an associate's degree? It's one of the best jobs out there and it's growing. They need you. And it can't be outsourced.
I'm going to tell you about that job right after the break.
ROMANS: America needs more jobs. After that hellish recession, job creation just has not been strong enough. Nearly 60 percent of the jobs gained in the recovery, by the way, have been low wage jobs as well. And we've only seen strong employment growth in a few sectors, a few sectors that stand out.
Leisure and hospitality, for example, and the service sector and health care. Last month alone, 38 percent of jobs added were in health care. It's one of the few fields where you can make a good salary without a bachelor's degree.
Dental hygienists make almost $70,000 a year on average, with an associate's degree. It's a great job if you don't mind bad breath. We spent a day with one dental hygienist to get the dirt on cleaning teeth.
UNIDENTIFIED MALE: How are you?
CHARMAINE DAVIS, REGISTERED DENTAL HYGIENIST: How are you? Good to see you.
UNIDENTIFIED MALE: Nice to see you. Thank you. ROMANS (voice-over): Charmaine Davis loves her job.
DAVIS: Lots of people love dental hygienist. I love, love hygiene. This is my passion. This is my career.
ROMANS: Flexibility, high pay and growing command put dental hygienist at the top of this list of best health care jobs, ahead of audiologist, occupational therapist, physical therapist, and optometrist.
DAVIS: We'll get started and then we'll do the oral exam.
ROMANS: The median income for dental hygienists is about $68,000 a year, according to government stat. Hiring is projected to rise 38 percent by the year 2020, above average for an industry already on a hiring tear.
More than 3 million health care jobs have been added over the last decade. And the industry is projected to grow nearly 30 percent by 2020.
PAUL KECKLEY, DIR., DELOITTE CENTER FOR HEALTH SOLUTIONS: The data clearly says that virtually every occupation in health care will see job growth ranging from primary care and general surgery dentistry, even psychologists.
But the largest number of new jobs will be mid-level jobs. These will be jobs of technicians, of allied health professionals, of home health aides, even health coaches.
ROMANS: Here's the pay for those top jobs in health care.
But not all health care jobs are created equal. There's huge demand for home health and personal care aids, but they take home about $20,000 a year. Good paying jobs like Charmaine's take an investment and more school.
DAVIS: I took the opportunity of doing it in the evenings. It was four days a week and I worked full time during the day and on the weekends.
ROMANS (on camera): Wow. So you were working so hard.
DAVIS: I was working really hard. But it was worth it.
ROMANS (voice-over): But these are investments you have to make in a career, right? A decision to not have a job, but to have a career.
DAVIS: That was my goal.
ROMANS: She needed an associated degree. The typical program cost 30 grand. Charmaine made the investment and is collecting the dividends. And we're not just talk about the money.
(on camera): And when they open that mouth --
DAVIS: When they open that mouth, nothing surprises me after 24 years. Nothing.
ROMANS: It feels good to get that plaque buildup.
DAVIS: It does. Do that polishing and walk out and get that beautiful smile, knowing that they're going to continue with their home care.
ROMANS: She's the real deal.
ROMANS: Good job security there for some of those health care fields.
The debates are over. Closing arguments started. Ten days left until you head to the polls.
But there are key issues both candidates are just flat-out ignoring. I'm going to rant on what we haven't heard.
ROMANS: In 10 days, we head to the polls, but there are still major issues both candidates have failed to address. Hello, Europe, anyone?
The deterioration of Europe's economy squeezing the sales and profits of U.S. corporations.
DuPont is cutting 1,500 jobs worldwide. "Forbes" says it will lose $1.5 billion in Europe this year.
Caterpillar just slashed its 2012 profit forecast again. It says, "We do not see signs the governments of the Eurozone and the European Central Bank will change economic policies to deal with the recession. We believe that the Eurozone is the most significant risk to our 2013 outlook."
Ouch! So, Mr. President, Mr. Romney, what role if any should the U.S. be playing in fixing Europe's debt crisis and limiting contagion? I ask. But all I hear is this.
Then, there's housing. Yes, the recovery looks real, but it's fragile. Foreclosures are at a five-year low but more than 500,000 homeowners still got a notice last quarter. Negative equity is falling, but 10.8 million Americans are still under water. Yet both candidates have been virtually silent on housing.
But the one thing that really gets me, the one I've been talking about for months, the fiscal cliff, massive tax hikes, massive spending cuts scheduled to take effect January 1st. Actually, it came up in the last debate when the president flatly dismissed it.
(BEGIN VIDEO CLIP)
OBAMA: It will not happen.
(END VIDEO CLIP) ROMANS: It will not happen. He's talking about the sequester -- the part of the fiscal cliff that mandates huge, sharp automatic spending cuts. He says it's not going to happen.
How can the president be so sure?
(BEGIN VIDEO CLIP)
DAVID AXELROD, OBAMA CAMPAIGN SENIOR ADVISER: Well, he can be sure because when the people vote on November 6th and the president is re- elected, a strong message will be sent that the American people want a balanced approach to solving this problem, and there are plenty of people on both sides who want to get that done and will get that done.
(END VIDEO CLIP)
ROMANS: Who want to get that done, but are they talking? No talks of Congress. No effort to make any real progress right now. Just a wait until after the election, and it will be all fine kind of thing.
Sorry, I'm not too reassured yet. That's an awfully big gamble when American households are facing an average tax hike of $3,500, when $109 billion in automatic spending cuts -- not well thought out or smartly targeted are set to take effect next year.
When the CBO has said going over the fiscal cliff will plunge the U.S. economy back into recession. I'm looking for some real answers. I'm looking for some real leadership.
And with 10 days until the re-election, it doesn't look like we're going to get it, not out of Washington, not out of Congress, and certainly not on the campaign trail.
What have you heard? Have you heard anything that you need to hear to make your decision? Tell me @ChristineRomansCNN on Facebook or via Twitter @ChristineRomans. Let's keep the conversation going.
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