Subject: Gramm vs. Reich: Big Government Alive and Well GrammNet Issue 1/14/98.1 Dear Friend of Phil Gramm, I'm sure you're familiar with Bill Clinton's famous statement that "the era of Big Government is over." Coming from the man who wants to socialize our entire health care system (one-seventh of the economy), the statement is a joke--or it would be, if his liberal media friends didn't promote it as a serious assessment of reality. The following debate between Phil Gramm and former Labor Secretary Robert B. Reich (fondly known by some conservatives as "The Fourth Reich") demonstrates that Gramm is fighting against Big Government on other fronts besides health care. It also demonstrates the capacity of Big Government addicts like Reich not only for total denial of reality, but also for complete evasion of any basic question. It's a brief debate, but I think you'll find it telling. Sincerely, David B. Levenstam, CPA, MT, MA ------------------------------- CNN INSIDE POLITICS 17:00 pm ET January 13, 1998; Tuesday 5:03 pm Eastern Time Interview With Senator Phil Gramm and Robert Reich GUESTS: Phil Gramm, Robert Reich HIGHLIGHT: Former Clinton Labor Secretary Robert Reich, and Republican Senator Gramm's talk about whether the era of big government is back. JUDY WOODRUFF, HOST: So the question raised: Is the era of big government, back? Let's ask our guests. Republican Senator Phil Gramm of Texas, who you just heard from, he is joining us from Capitol Hill. And, Former Clinton Labor Secretary Robert Reich is in Boston. Gentlemen, thank you both for being with us. Robert Reich, to you first. You just heard Senator Gramm's and Eileen O'Connor's piece saying yes, the era of big government is back. Is he correct? ROBERT REICH, FORMER LABOR SECRETARY: Judy, I don't think the era of big government is back. The proposals that the president is likely to put forward in the state of the union, are actually very modest. They are all paid for. He may be calling for an increase in the minimum wage, but again that is hardly big government. Your survey, and I've seen similar surveys shows that most Americans, at least in plurality, would like any government surplus to be spent on education, on health, on child care, on things that do give the average family tools for getting ahead, and there is a big gap between what people need to get ahead and what government, or society for that matter now provides. WOODRUFF: I want to ask you about that specifically, but Senator Gramm back to you. You heard Robert Reich who is saying that these programs are very, very modest. That they are all paid for in the budget. What about that? Senator Gramm? GRAMM: Can you hear me, Judy? WOODRUFF: Yes, I can. Did you hear my question? GRAMM: Yes, I heard your question. I think maybe to Bob they're modest, but I think as most Americans look at a week where the president proposed roughly 10 billion dollars of new expenditures related to welfare for immigrants. Had a major initiative related to expanding Medicare, the largest expansion of Medicare in 30 years. And that's a program that is already teetering on the verge of insolvency. A $20 billion child care program. I think these programs add up, but what they really show, Judy, is that the president believes that expanding government is the way to help people. Republicans believe that letting people keep more of what they earn, so that working families, that in 1955 were sending one out of every $50 they dollars they earned to Washington, if they had two children. Today sending one out of every four dollars to Washington. If you let them keep more of what they earn, they can do a better job of dealing with problems of education, of health care, of child care, and let's not forget when everybody is talking about balancing the budget, we still are taking $100 billion a year out of Social Security, and government spending it, maybe we ought to stop doing that and have a real investment program. WOODRUFF: Robert Reich, what about that? REICH: Well I am all in favor. And I think many Democrats, many (INAUDIBLE) are all in favor of a genuine investment program. Infrastructure in America, a lot of roads and bridges falling apart, but what better investment also, than in the education of our people, particularly our working class and poor kids. Many schools are literally falling apart, and also health care. If Senator Gramm wants to oppose a slight expansion in Medicare, covering about 300,000 additional people who have been displaced from their jobs, over 55 years old, or people between ages of 63 and 65, early retirees. If he wants to oppose that, well, that's his prerogative, but I can bet you that Democrats will make some hay, Republicans will pay the price for opposing it, because most people in America want that. WOODRUFF: Senator, what about the education proposal? More money to repair rundown schools. More money to hire teachers to reduce classroom size. REICH: Well Judy, I don't ever remember, especially in this age where big government is the driving force at the federal level anyway. I don't ever remember the federal government being a major engine in building schools and in hiring teachers. The incredible paradox here is, we have yet to balance the federal budget, and over 40 states have surpluses. I can see a tremendous amount of politics in a proposal like that, but I'm afraid I just don't see any policy in it. It seems to me, if we wanted reform education, what we would be doing is giving parents, especially low-income parents, in school where their children are in schools that are failing or are dangerous, giving them funds for a voucher so that they could have options that higher income people have. WOODRUFF: Let's let Robert Reich respond. REICH: Judy, the president will be calling for additional funds for charter schools, and that gives parents particularly parents in poor areas, more choice. But the senator said that federal government has not had very much, if at all, a role to play in public education, well that's simply not the case. Not only do we have the famous legacy of the G.I. Bill and all the college and Pell programs, but we also have the famous National Defense Education Act, which trained a whole generation of teachers of science and math, and we were responsible for some of the best education in our classrooms we've ever had. WOODRUFF: Gentlemen, it is a debate that will go on. We're going to have to stop it here, but we thank you both very much for joining us. GRAMM: Thank you. REICH: Thank you. WOODRUFF: Senator Phil Gramm, Robert Reich thank you both.