The Cycle | March 18, 2013
>>> according to gallup polling, americans are more pessimistic about this country now than at any time in the last half century. we're not alone in that thinking. the world economic forum places the u.s. as only the seventh fittest economy in the world. we're ranked 34th in primary education and health care . our macro economic environment is 111th. that cannot be right. our next guest says the notion that we're losing our competitive edge is widespread and pervasive, it is not necessarily correct. ed mcbride is the washington bureau chief for the author of the special ro on america competitiveness. welcome, sir.
>> thank you for having me.
>> would you like to tell me, and i welcome the message that things are not as bleak as we've been told. please. talk us off the ledge.
>> well, as you said, there is a the love hand wringing, a lot of reports. these dire statistic that's seem so dreadful. it is almost impossible to remember they're true. 111th? that's to do with the size of the national debt basically. but what all these gloomy sort of hand wringing accounts neglect, they focus on washington and on gridlock and on the failure to resolve all the questions about the budget and they don't look at what's going on in the rest of the country. the good news is, that in the rest country, people aren't sitting around waiting for politicians in washington to solve their problems. they're getting on and addressing the kinds of issues that people in washington keep thinking will hold the economy back. so they're addressing the problems with education. they're addressing the problems with infrastructure. they're encouraging innovation. they're changing the way government regulations are written and encouraging investment and helping the economy along. of course the failure is still holding the country back. there's a lot that will help the economy. and it provides a model. should washington ever get its act together, there are lots of great ideas out there for how to revive the economy.
>> one of the things the report mentions that is happening at the federal level , continued investment in r&d. which you say very important to the future economic growth and the country. i'm wondering if the sequester cuts will damage that. and there was an op ed from the department of energy 's national laboratories . it was titled, the sequester is going to devastate u.s. science research for decades. they said this drop in funding will force to us cancel all new programs and research initiatives, probably for at least two years. is that going to put a damper on our future prospects?
>> if the sequester holds in its current form for the ten years that it is supposed to, then yes, the answer is there will definitely be horrible consequences. i think before we go to the bad news, you need to give a little context. the good news is that america has been investing in research and development . it has been investing in science and technology at a very high rate. in 2009 , thanks partly to the stimulus, the u.s. investment matched the previous high at the space race at 2.9 of gdp. that amount of money being poured into public and private research. so we've come down a little because of the budget cuts already put in place and we've come down much more because of the sequester. that speaks exactly to what i was argue ewing in my special report . the federal government tends to either not really help or actively get in the way. in this inassistance it would be actively making things worse if it started. and theoretically neither party wants that. you hear the president say all the time that investments in scientific research are so important. and even on the republican side , there is an acknowledgement that this isn't the top of their list to cut. so hopefully we won't go ten years at the levels laid out in the sequester and those ill effects won't happen. if they did, it would definitely be damaging.
>> i want to get this one in. you write from a competitiveness standpoint. you're expecting and you think it is necessary that we have immigration, overhaul of the immigration laws . obviously there is a lot of flux. what do you think are the most important things we would need?
>> as far as i'm concerned there is no such thing as bad immigration. i don't want to say that anything is unimportant. immigrants get up and go. they bring innational networks. i don't want to say we can leave any part of the immigration reform out. clearly the bit again where this bipartisan agreement is the stem piece. the skills workers. there doesn't seem to be any question that they contribute massively to the economy. anybody with an advanced degree, it doesn't have to be from an american university , although there are plenty of those people. but anybody with advanced degrees in science, math, engineering, any technical field. if more of them were allowed to come to america or even the ones who are here for whatever reason after studies, were allowed to stay, that would provide a huge boost to the economy. that seem to me essential.
>> indeed. thank you very much.
>>> we're about 30 minutes before the closing bell ask the markets are in turmoil as cyprus contemplates a tax. it owes the eu central bank $7.6 billion to keep its banks from collapsing. it is closely tied to greece' economy. because of that, shared in its financial crisis . e.u. leaders say it is a money laundering hub. the government wants to tax accounts to come one the money. so if you already paid taxes on income or whatever will be taxed again and taxed hard. nearly 7%. meaning you'll have an $8,700 tax levied on you. if you managed to sock away more than $100,000 euros, you'll be forced to hand over at least 13 grand. banks in cyprus are closed today and will stay closed until thursday as parliament closed on the plan. nearly all atms are closed as the people withdraw as much as they can. now there are fears bank runs elsewhere and others, imagine if it happen here. what would we do? cowboy bill says close my accounts, bye bank! share your thoughts with us and cowboy bill. up next, a sign of the time. did you know, women and girls now outperform the guys at every level of schooling? why are women still earning less? we'll explore that question and so much more. [ male