>>>THIS IS A BIGGER BUBBLE THAN THE ONE THAT BLEW UP IN 2008. WE HAVE MORE DEBT THAN EVER BEFORE. INDIVIDUALS, CORPORATIONS, THE GOVERNMENT IS LOADED UP WITH DEBT AND AS INTEREST RATES GO UP, THAT DEBT IS UNSERVICEABLE. LIZ: WHAT ELSE, PETER? THAT WAS EURO PACIFIC CAPITAL CEO PETER SCHIFF ON OUR SHOW YESTERDAY SHINING A HARSH SPOTLIGHT ON OUR NATION’S MASSIVE DEBT AND DEFICIT. HUGE NATIONAL PRICE TAGS FACE US RIGHT NOW. HURRICANES MICHAEL AND FLORENCE CAUSED WIDESPREAD DAMAGE ACROSS THE SOUTHEAST. THE GOP’S PROMISE TO GET FUNDING FOR PRESIDENT TRUMP’S MULTI-BILLION DOLLAR BORDER WALL AFTER THE MIDTERMS, TO CAPITOL HILL SIMPLY TRYING TO KEEP THE LIGHTS ON AS ANOTHER BUDGET DEADLINE LOOMS IN DECEMBER, JUST IN TIME FOR THE HOLIDAY SEASON. BUT WITH NEWS THAT CORPORATE TAXES COLLECTED BY THE GOVERNMENT ARE DROPPING TO THE SKIMPIEST LEVELS IN 75 YEARS, IN PART DUE TO THE CORPORATE TAX CUTS, WHERE WILL THE GOVERNMENT GET THE FUNDS TO PAY FOR ALL OF THIS? GORDON GRAY OF THE AMERICAN ACTION FORUM SAYS THE MONEY’S THERE. MAYA McGUINNESS SAYS IT IS NOT. THEY BOTH JOIN ME NOW. I WILL BEGIN FIRST WITH YOU, GORDON. LET’S START WITH THE HURRICANES ALONE. MICHAEL, A THE TWELFTH BILLION DOLLAR DISASTER TO HIT THE UNITED STATES THIS YEAR ALONE. JUST WITH THAT, TELL ME WHERE THE MONEY’S COMING FROM.>>WELL, IN THE NEAR TERM, I REALLY DON’T WORRY ABOUT THE U.S.’S ABILITY TO RAISE THE CASH TO PAY ITS BILLS. JUST THIS WEEK, BETWEEN THE THREE-YEAR AND TEN-YEAR TREASURY NOTES, THE TREASURY PUT OUT $50 BILLION IN A SINGLE DAY. BETWEEN NOW AND THE END OF THE YEAR, WE ARE GOING TO IN GROSS TERMS ISSUE ON THE ORDER OF $2 TRILLION IN DEBT. THAT’S NOT NET, THAT ALSO INCLUDES THE PART THAT’S REFINANCING EXISTING DEBT BUT THERE’S A MARKET FOR OUR DEBT. PEOPLE WANT TO GIVE US THEIR CASH FOR OUR DEBT SO WE CAN LIQUIDATE OUR OBLIGATIONS IN THE NEAR TERM. THAT INCLUDES STORMS AND OTHER BILLS COMING DUE. BUT I’M VERY CONCERNED ABOUT THE MEDIUM AND LONG-TERM STATE OF OUR FINANCES AND GROWING DEFICIT. WHEN THE INTEREST RATES DO EVENTUALLY NORMALIZE, WE ARE GOING TO BE PAYING MORE IN INTEREST AND DEBT SERVICE THAN ON THE MILITARY. LIZ: THAT’S WHY THE NEAR TERM IS ACTUALLY CRUCIAL AND IMPORTANT. MAYA, THE GOVERNMENT’S COFFERS, ARE THEY FLUSH WITH MONEY?>>WELL, GORDON AND I OBVIOUSLY AGREE THE LONG TERM AND MEDIUM TERM IS A REAL PROBLEM, BUT WITHOUT QUESTION, THE SITUATION WE ARE IN RIGHT NOW IS INCREDIBLY PROBLEMATIC. AS YOU POINTED OUT IN YOUR LAST SEGMENT, THERE IS A WHOLE LOT GOING ON IN THE WORLD RIGHT NOW. THERE ARE SECURITY ISSUES, THERE’S NATURAL DISASTERS, THERE’S STOCK MARKET GYRATIONS. THE LAST THING YOU WANT IS AN UNHEALTHY BALANCE SHEET WHICH IS NOW WHAT WE HAVE IN THIS COUNTRY, AT THE VERY TIME WHEN OUR ECONOMY IS GROWING, OUR DEBT IS GROWING EVEN FASTER. IN MANY WAYS, IN MOST WAYS RIGHT NOW, UNFORTUNATELY, IT’S SELF-IMPOSED AND COMES FROM THE FACT OUR LAWMAKERS ARE REALLY NOT BUDGETING ANYMORE. THEY ARE PUTTING EVERYTHING ON THE CREDIT CARD. LIZ: THEY DID NOT EVEN CUT SPENDING. IF YOU ARE GOING TO CUT TAXES, THEN PAIR IT WITH CUTTING SPENDING. YOU HAVE CORPORATIONS NOW WHO WERE PAYING 35%, NOW IT’S 21%. THERE’S A HOLE NOW THAT NEEDS TO BE FILLED, AND WE ARE SEEING THE TAX RECEIPTS FROM CORPORATIONS COMING IN AT THE WORST LEVELS IN 75 YEARS. I THOUGHT FROM BOTH TREASURY AND THE PRESIDENT THAT THE TAX CUTS WOULD PAY FOR THEMSELVES.>>WELL, I NEVER BELIEVED THAT A TAX CUT WOULD PAY FOR ITSELF. HOWEVER, IT’S IMPORTANT TO PUT THE CORPORATE CHANGE AT LEAST IN CONTEXT. CORPORATE TAX RECEIPTS MAKE UP A RELATIVE FRACTION OF OUR OVERALL TAX COLLECTIONS, AT LEAST COMPARED TO INDIVIDUAL INCOME TAXES AND PAYROLL TAX RECEIPTS. SO THE RELATIVE DECLINE IN THE CORPORATE TAX RECEIPTS ISN’T AS CONSEQUENTIAL IN MY VIEW AS THE INDIVIDUAL RATE CUTS, WHICH WERE VERY EXPENSIVE. MY OWN VIEW IS THAT TAX REFORM SHUF BEE HUF BEE SHOULD HAVE BEEN DONE ON A REVENUE NEUTRAL BASIS. IT WASN’T. IT WAS ADDED TO THE DEBT. WE HAD $10 TRILLION IN BASELINE DEFICITS BEFORE THE TAX CUTS HAPPENED SO WE HAD A BUDGET PROBLEM. WE STILL HAVE A BUDGET PROBLEM. LIZ: MAYA, WHAT’S YOUR BIGGEST FEAR? HOW WILL PEOPLE FEEL THIS IN THE NEAR TERM, IF AT ALL?>>MY BIGGEST FEAR IS THE FISCAL SITUATION IN THIS COUNTRY IS REALLY A REFLECTION OF HOW BROKEN OUR GOVERNANCE SYSTEM IS, THAT WE ARE NO LONGER WILLING TO MAKE HARD CHOICES, TRADE-OFFS. JUST LIKE YOU SAID, EVERYBODY SAID THE TAX CUT WOULD PAY FOR ITSELF. IT WAS NEVER GOING TO PAY FOR ITSELF, JUST LIKE PEOPLE ARE ABOUT TO START SAYING NEW SPENDING PROGRAMS WILL PAY FOR THEMSELVES AND THEY WOULDN’T. WE DON’T HAVE POLITICIANS ON EITHER SIDE WHO ARE NOW WILLING TO SAY THESE ARE THE CHOICES WE HAVE TO MAKE IF WE WANT TO CUT TAXES. LET’S CUT SPENDING ALSO. THEY ARE NOT DOING THAT. THE RESULT IS IT’S GOING TO SLOW THE ECONOMY, IF AND WHEN WE HAVE A REAL DOWN TURN OR MORE DISASTERS, WE DON’T HAVE THE FISCAL ABILITY TO RESPOND IN THE WAY THAT WE SHOULD, AND IT’S GOING TO LEAVE ALL AMERICANS IN A WORSE ECONOMIC POSITION. WAGES WILL BE SLOWER, IT WILL HAVE A LONGER TERM EFFECT ON JOBS. ULTIMATELY WE ARE BASICALLY HANDING THE BILL TO OUR CHILDREN AND SAYING WE DON’T WANT TO PAY IT, YOU ALL DO IT. THAT’S NOT THE WAY YOU REMAIN AN ECONOMIC SUPERPOWER. MY REAL CONCERN IS THAT WE HAVE TO FIX THE WAY WE MAKE DECISIONS IN WASHINGTON AND WE HAVE TO STAY THE STRONGEST ECONOMY IN THE WORLD. LIZ: WELL, I THINK ANYBODY WHO RUNS A HOUSEHOLD KNOWS YOU DON’T RUN DEFICITS DURING FLUSH TIMES. WHEN YOU HAVE THE MONEY, YOU PAY OFF THE CREDIT CARD BEFORE YOU BUY THE MASERATI. WE WOULD LOVE TO HAVE YOU BOTH BACK BECAUSE IT IS A DEVELOPING