JUDY WOODRUFF: President Clinton, thank you very much for talking with us.
PRESIDENT BILL CLINTON: Glad to do it, Judy.
JUDY WOODRUFF: So we’re talking on the eve of the Clinton Global Initiative, where the focus is once again on jobs. And as you know, that’s also very much the focus, that and the economy, of this year’s presidential campaign. So I want to ask just a few questions about that to start with.
This latest jobs report last week — disappointing, only 69,000 jobs created across the country. The unemployment rate is up. Doesn’t that seriously undercut President Obama’s efforts to say that things are moving in the right direction?
BILL CLINTON: Well, that means it’s something he needs to talk to the American people about.
But to me it doesn’t, for two or three reasons. One is I think that the jobs creation has slowed down partly because maybe we were a little robust in the winter, because we had a warm winter, and maybe that’s given a slower spring. But the big factors are Europe, which is, like, casting a pall over everything, all this trouble in Europe where unemployment is three points higher in the eurozone than it is here. And it’s slowed down growth in India, China and Brazil, too, as well as here. That’s the first thing.
Secondly, I think that the government has real ability to generate employment through infrastructure investments and aid to state and local governments, but the Congress won’t pass the jobs plan. And we’ve had, in the last 27 months, 4.3 million new private-sector jobs, but we’ve lost 600,000 public jobs because we didn’t continue what the stimulus had done there.
And then the third thing is we’re still working out of this housing thing. If we could accelerate the rate — and it does seem to be picking up now — accelerate the rate in which all these mortgage issues are resolved, then I think you would see, particularly on the part of small businesses, a lot more borrowing, a lot more investment, a lot more activity.
JUDY WOODRUFF: But if there are three or four months like this last one, where the jobs report is so — is moving down, some people are saying the president’s goose is cooked politically.
BILL CLINTON: I don’t agree with that. I think, for one thing, he would be in trouble if that happened and the Congress had passed his whole jobs plan. But they didn’t, and they are explicitly advocating — and so is Gov. Romney — an approach that looks like the approach the Europeans are trying to get out of, which is austerity first, which drives up unemployment and interestingly enough drives the government deficit up.
And he says, let’s grow now and adopt a 10-year budget plan that drives the budget down. They’re saying, let’s have austerity now and adopt a 10-year budget plan which, according to all the independent analysis, would actually add a trillion or two dollars to the debt because of their big tax cuts. So I think he’s really just got to talk to the American people and trust them with the truth here.
This is a very complicated thing. If you go back 500 years, the average financial collapse takes five to 10 years to get over, to get back to full employment — full employment. If there’s a mortgage collapse, which we’ve had for the last couple of hundred years periodically, it’s closer to 10 years. What he’s trying to do is to beat that. The American people are – they want things done the day before yesterday, so they don’t like to wait 10 years to do anything. And there’s too much misery out there. I would say he’s on track to beat that pretty quickly by quite a lot.
And America still has the world’s largest economy, still the biggest exporter and still has enormous strengths. We are younger than Europe and Japan. We’re going to be younger than China in 20 years. We’re the most diverse economy in the world. We’re importing manufacturing jobs again. We’re bringing them home. For the first time since the ’90s manufacturing is growing. And it looks like it’s going to continue for three to five years.
We’re going to be OK. This is the agonizing fits-and-starts phase. Assuming no collapse in Europe, we’re going to be OK. And the Europeans appear to be trying to put together a sensible response on the banking side and eurobonds to invest in infrastructure to grow the economy. So if that happens, I think he’ll be fine. I think he’ll get through it.
JUDY WOODRUFF: But there is a great debate about this, and you’ve given it a lot of thought. But what is more important when it comes to job creation? Is it lowering tax rates, or is it government investment?
BILL CLINTON: It depends on what the conditions are when you start. Right now it’s government investment, because we’ve had lower tax rates — the president hasn’t raised the tax rates. He wants to raise the tax rates over the long run to the upper-income people as a part of a debt reduction plan over 10 years. He hasn’t proposed to do anything to contract the economy right this minute. And when there is almost zero private activity and no demand for money, interest rates are virtually nothing. The interest rate on a government 10-year bond yesterday was a quarter of a percent. If you assume inflation is at 2 percent, that means somebody that buys a million dollars in government bonds is paying the government to keep their money. I mean, it’s amazing. Under these circumstances, it’s more important that the government gin up activity and put people to work, and especially if you can attract private capital, which we could with that infrastructure bank proposal that has Republican and Democrat support.
JUDY WOODRUFF: But is that going to be workable, President Clinton, with this European debt crisis overhang that you’ve just been talking about?
BILL CLINTON: Yes, because the German interest rates, believe it or not, are even lower than ours. But what will happen is — that’s what the Europeans are trying to do. They’re trying to figure out, number one, how can we avoid a bank run in the vulnerable countries? Greece is a special case, where they don’t have a good tax system and hardly anybody pays what they’re supposed to or anything like that. But the Spanish had a government budget surplus before their real estate collapse.
So the Europeans are thinking, we probably better do something to improve the security of the banks. An individual deposit is insured 100,000 euros. In America it’s now $250,000. So maybe they’ll take it up some and do some other things to stabilize the banks. Then if they can put together a eurobond that is backed by the biggest economies, it’ll be at very low interest rates too. And that’s what they’re talking about doing, moving away from austerity now to growth now.
You cannot balance a budget without three things. You have to have economic growth, spending restraint and an appropriate revenue stream. You can argue about the last two, but the first is clear. If you look at what happened in the U.K. when they tried austerity first, it didn’t balance the budget — because no matter how much you cut, if there’s no private activity, revenues are going to drop more than you cut spending.
JUDY WOODRUFF: But you’re saying there’s an urgent situation in Europe right now.
BILL CLINTON: Urgent. It’s urgent in Europe, and I think they have 30 to 50 days to fix it. And I think they’re – and they just need to send a signal out there. If they calm things down, and then we can increase activity here, I think, you know, we’ll get through this.
JUDY WOODRUFF: Just one question about Governor Romney and the campaign. You praised his business experience last week, his record. You said he passed a threshold test. I guess my question is how do those skills that he picked up as a – as a private-sector executive at Bain Capital – how do they translate, in terms of job creation, into being president?
BILL CLINTON: I think they have much more to do with the way you’d sort of manage the White House and the style you’d have. I don’t think they necessarily have any relevance at all to creating jobs. They might if the macroeconomics is right. But if you — if you look at the economic plan that he’s advanced, in my opinion it’s wrong on two counts: wrong in the short term, wrong in the long run. In the short run it calls for austerity now, which means more unemployment. And in the long run, it calls for tax cuts so big, with unspecified savings, that every independent analyst says it’ll add $1 trillion or two to the debt.
So I don’t think it — business experience does not guarantee success. If you go back to the Kennedy presidency, you look at the last 50 years, the Democrats have had the White House 23 years; the Republicans have had it 28 years. We’ve had 66 million private-sector jobs created, 42 million under the Democrats, 24 million under the Republicans. And you know, what creates jobs is a healthy level of investment, a well-prepared workforce, a commitment to new markets abroad and at home, and constant innovation and investment in research and development.
If you look at the places in America that are succeeding today — and I think that’s the key to what we should all be doing now; that’s why I’m doing this CGI America — it’s places where you’ve got creative networks of cooperation with Republicans and Democrats. But I don’t think that saying that I was in business and I succeeded, therefore I’d be a good president on the economy – it just doesn’t follow. There’s no evidence of it.
JUDY WOODRUFF: So before I ask you about CGI, is the Obama campaign wrong to continue to criticize Romney’s record at Bain Capital?
BILL CLINTON: Not necessarily. It depends on the facts of the case. That’s what I tried to say in the CNN interview. The equity business can be good if you – I’ve got a friend who buys failing companies, and he tries to turn them around. And he’s turned a bunch of them around, but not all of them. So sometimes he tried and failed. The effort was honorable. That’s a good thing.
There are lots of examples over the last 20 years where people used equity to take control of companies, got the companies in greater debt, looted the assets, caused more people to be fired and, in some cases, compromised the pensions. That’s a bad thing. That’s where you’re just — you’re buying something and looting it because you can.
I didn’t have any idea, when I was giving that answer, that I was wading into some controversy in the campaign, because I haven’t seen the ads, and I’m not following it, and I’m not really part of it. But you’d have to know about a specific case to know whether it was a good or a bad thing. But there are a lot of good people in that business doing good things. That’s the point I was making.
But it’s much more relevant to look at what he did as governor and what he proposes to do as president. Even though most people are very cynical about us politicians — I’m not in this business anymore; I can say this — there’s astonishing consistency throughout history with people running for president actually doing their best to do what they said they’d do when they ran.
And in the few glaring exceptions, we’re almost always glad — like Franklin Roosevelt promised to balance the budget. He got in; there was a depression; he realized he couldn’t. We’re glad he didn’t. Franklin — Abraham Lincoln promised, in his first campaign for president, not to free the slaves. We’re glad he didn’t keep that commitment. But by and large, people do what they say they’re going to do.
JUDY WOODRUFF: So the Clinton Global Initiative, this is the third year that you’ve expanded the focus to working on creating jobs in this country. Why are so many companies and business owners still reluctant to hire? We’re told they’re sitting on $2 trillion in cash.
BILL CLINTON: They are.
JUDY WOODRUFF: What is holding them back? And I remember having a similar conversation with you about this two years ago.
BILL CLINTON: Yeah. I think there’s several reasons. One is this uncertainty about what’s going to happen in the global economy because of all the European issues is having a big impact, particularly on a lot of the bigger companies.
Secondly, even though the banks — several banks are actually accelerating their small business lending now. And 61 percent of the small businesses in a recent survey said they expect to grow in the coming year and they need more capital. There’s still banks that are constrained because they haven’t resolved enough of this home mortgage business. Quicker we get that through, the better it’ll be. I think that’s a problem.
The third thing is that there’s not enough of what is generating opportunity in the boom places in America — in San Diego, Silicon Valley, Orlando, around the health training in Cleveland — where you say: This is an idea for the future. Let’s everybody get on it, let’s do it. That’s what Rahm Emanuel’s trying to do in Chicago with the first urban infrastructure bank. He’s trying to say this is worth your investment, because we know we can put people to work, we know it will add to the value of our city long term and we know what will promote economic growth. And that’s — that third thing is what I’m trying to do. I’m trying to figure out how to get people to look at the wealth that’s all around them and invest in it.
JUDY WOODRUFF: And you – one of the things you do at the Clinton Global Initiative is get companies – business leaders to make commitments that they will get involved. Give us just a couple of examples or a couple of names of companies who’ve done this and how it’s turned out.
BILL CLINTON: Yeah. Last year, the AFL-CIO said it would get partners and spend $10 billion over the next five years to retrofit buildings, because construction workers can’t be fairly expected to build a lot of new houses and a lot of new office buildings. So in the last year, they’ve already spent $165 million. They’re about — they’re ready to contract over $400 million more. And we’ve finally have gotten some partners who’ve given us some free time to figure out a way to franchise this so we can put these projects together faster and move this money quicker. That’s a good example.
Last year, the Carnegie Corporation said that the president had asked for 20,000 teachers in science, engineering, math and technology, so-called STEM forces, that they would provide 20,000 of them. They had, I think, 27 partners and they said, we’ll raise $20 million. They now have 115 partners. They’ve already raised $24 million.
JUDY WOODRUFF: In the private sector?
BILL CLINTON: Yeah. Total private sector. But they’re going to pay to train these teachers to go into the schools, to prepare people to do this work. So that’s a good example.
We had a group — an unusual group with operations that hire — that train and — or try to place military veterans in jobs, because their unemployment rate’s 25 percent above the national average. So a group of people from the entertainment industry out west, mostly in Hollywood, said, we will work with these groups to figure out how to do this. And together, they said, we think we can put a half a million veterans and their spouses in jobs over the next two-and-a-half years and create another 100,000 jobs in the mental health area, providing help for those with post-traumatic stress syndrome. And they’re on the way to keeping their commitment.
So that’s the kind of thing that we’re looking for. And this year, what I’m trying to do is to emphasize — last year, I just tried to give a landscape of ideas that had worked. This year, I want to try to show the process that works; that is, why is Joplin, Mo., for example, coming out of its devastating tornado more quickly than other cities have come out of natural disasters? It seems like it’s because, instead of having a grand plan that they took years to put together and wanted to cross every T and dot every I in advance, they decided to just go and look at where the local potential was and let the entrepreneurial spirit of the community flourish. And why is Cleveland and why is Pittsburgh — why are these two cities rebranding themselves as health care meccas for the 21st century, training people, including middle-aged, non-college-educated unemployed workers, for the health care jobs they know will be there, whatever happens to the health care law before the Supreme Court?
JUDY WOODRUFF: But it sounds like it’s not getting any easier to persuade these corporate folks to get involved. . .
BILL CLINTON: The big corporations are. Although we’re going to have a couple – you’ll see. We’re going to have some, particularly in California, some very big energy users make some commitments that will create jobs by cutting their energy use and therefore helping their bottom line long term. We’re going to have some good new commitments.
But I think the most important thing now is to try to get people to adopt everywhere what’s working somewhere. If we can get 10 or 15 big American cities to do what Chicago’s doing with its urban infrastructure bank — and I’m working on a way to get that done that makes it easy for them to do – that would be huge. If we could get 10 more partners to package this $10 billion the AFL-CIO can access, either from its own fund or its partners, we could put that money out in three years instead of five, if we could put that money out in three years instead of five, it could have a huge impact on the American economy.
JUDY WOODRUFF: Just two other quick things, President Clinton. One is, you mentioned what presidents do, that they promise they’re going to do. One of the things Mitt Romney’s talked about doing, on day one as president, he said, I’m going to declare China a currency manipulator. This is something that a lot of presidential candidates, even President Obama have talked about: getting tough on China. But once they get into office, they find out it’s a lot harder than that. Do you sense –do you believe if Mitt Romney were elected, he’d be different, that he would get tough on China?
BILL CLINTON: Well, he might — look what our government has already done. We’ve already cited for violating the trade rules in solar panels and in wind towers already, and that’s because they oversubsidized and overproduced them. That’s the real story of the Solyndra loan. What happened after that Solyndra loan was given is, Solyndra was a technology that was markedly more efficient in converting the sun to electricity than the flat panels. But it was also much more expensive, and they had to get it to a certain value to be productive. After the loan was made, the Chinese came in with $32 billion in more subsidies — $32 billion. So there was no way — it just collapsed the market. So they’ve already done that.
Now, will he declare them a currency manipulator? He’s going to have to think about it, because he’s going to have to look at how much of our debt the Chinese hold and how dependent the world is on seeing their continued success. That is, it wouldn’t necessarily be good for America if there were a total collapse of the Chinese economy. That would cause a lot of trouble.
So do they hold their currency down? Absolutely. But it’s probably better to go after them on a case-by-case basis than to launch a broadside attack on their economy.
JUDY WOODRUFF: Last thing: money in this campaign. And we’ve heard from the Romney folk, people supporting Mitt Romney, it’s going — they’re going to spend a billion dollars or more in this election. We expect President Obama’s side to spend almost that much if not that much. Is that the kind of campaign we just have to get used to from now on?
BILL CLINTON: You could argue that $2 billion is not too much to spend for an economy that’s over $15 trillion. I personally think it’s unnecessary. Particularly when you’re running for president, we’re going to know who they are. They could do five debates instead of three, for example, or whatever they’re going to do, and do that.
I don’t like it because once you get past the informational stage, you’ve got that much money, it’s basically being used to target specific audiences with carefully tailored negative messages that confuse the issue. But the Supreme Court has said that we can’t limit it. So unless we’re prepared to overturn the Citizens United case, and even – maybe even Buckley v. Valeo before that, we’re probably not going to do anything about it. And – but I think it’s too much.
JUDY WOODRUFF: And is the country worse off as a result?
BILL CLINTON: Well, the country’s worse off if it confuses rather than enhances their understanding of the real differences. However, I worry about it less in presidential races, believe it or not, than congressional races, governor’s races, other’s races, for a very simple reason. We will see these people. Huge numbers of us will watch these debates. We will watch them on the evening news, and we will form opinions. Now, those opinions might be influenced by these negative ads we see, or they may not. But the American people have got a pretty good feel for this. They’re much more vulnerable to them in the off-year elections where the turnout is smaller, where people can be discouraged from going to the polls and where they don’t really know their member of Congress that well or their senator or their governor that well. That’s the real danger, that the whole guts, the infrastructure of American political life, could be infected by this.
I think the president — I know a lot of them are worried about these super PACs, and I’m a little worried about it, but I think he’ll do just fine in the debates. And you know, he can get his voice out there. And Gov. Romney may be worried about what the Obama campaign says, but he’ll have his chance in the debates and he can get his voice out there. That’s better.
JUDY WOODRUFF: President Clinton, thank you very much for talking with us.
BILL CLINTON: Thank you.