Ex-Sen. Bill Bradley: Washington Paralysis Could Bring 'Another Meltdown'

Tuesday, 08 May 2012 10:16 PM

By Jim Meyers and John Bachman

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Former U.S. senator and presidential candidate Bill Bradley tells Newsmax that “vicious political combat” is needed in Washington to deal with the “polarization and paralysis” gripping the legislative process.

The New Jersey Democrat also says the failure of both parties to deal with pressing issues could lead to the creation of a third congressional party to “jar” Democrats and Republicans into bipartisan action.

And he predicts that the United States could be headed for “another meltdown” if significant changes aren’t made regarding the financial industry.

Bradley was a star basketball player with Princeton University and the New York Knicks before he entered politics and won a Senate seat from New Jersey in 1978. He was re-elected twice, and ran unsuccessfully for the Democratic presidential nomination in 2000.

Today Bradley is a partner at the investment bank Allen & Company. His new book is “We Can All Do Better.

See the exclusive exerpt from the Newsmax interview with Bill Bradley below:






In the book Bradley outlines a program calling on the federal government to provide 30 percent of the cost of hiring new workers, which he says would create at least 7 million new jobs.

In an exclusive interview with Newsmax TV, Bradley explains: “With this proposal not one dollar of federal money would be spent that didn’t create a job. A company would hire someone and not fire anyone, and 30 percent — up to $25,000 — would be paid by the federal government for two years. It would be a $50 billion program. The result would be unemployment dropping dramatically.”

Asked if he has pitched his proposal to anyone in Washington and if they have been receptive, he responds: “Yes, I have pitched it to a number of people, and no, they have not been receptive.”

The reason for that resistance, he speculates, “might be a little bit of ‘not invented here.’”

He was also asked if the nation needs more fiscal restraint or more stimulus.

“I think we need both,” Bradley declares.

“The original stimulus wasn’t big enough. The issue is how do we stimulate good-paying jobs. I think there are a couple of things to consider. One is that nonfinancial corporations have $1.8 trillion on their books in either cash or other liquid assets. The question is how do you get them to spend part of that money on creating jobs in this country.

“I suggest there are a number of things we need to do. One is to address the confidence level. We simply have to get agreement in November on a $3 trillion to $4 trillion deficit reduction package. My hope is that the package would not take effect for the next two years but there would be structural changes in entitlement programs and defense programs and taxes that would lead to long-term deficit reduction.

“But deficit reduction isn’t enough. There are 66 million people in America living one paycheck away from economic crisis. The vast middle class has not moved forward. The reason corporations say they don’t hire is there is no demand, so you have to generate demand.

“That’s why I suggest that we embark on a massive infrastructure effort that would have 50 high-priority items on it, like high-speed rail, a new air traffic control system, all of which would be the economic foundation for growth in America for the next 50 years.

“Then you might get some of the money out of the corporate treasuries. If the corporations spent 30 percent of their $1.8 trillion on hiring people, that would result in an unemployment rate of 5 percent.”

The country needs these kinds of reforms or else “you’re going to have continued polarization and paralysis while the situation gets worse and worse in terms of middle-class families, in terms of investors looking at the long-term deficit, et cetera,” Bradley tells Newsmax.

“Sometime in American politics, points of view have been irreconcilable. Right before the Civil War comes to mind. But usually it is decided through vicious political combat. It is bloodless but can be vicious. What happens then is either one side wins decisively and therefore can enact their program, or there has to be bipartisanship.

“If neither the bipartisanship or the dominant victory take place, then that opens the way potentially for a third congressional party to enter the picture as sort of the can-do party. It is the party that lays out the tough positions and could win 20 to 25 seats. It then can be at the fulcrum of power in Congress and maybe jar each of the parties to take on their sacred cows and deal with the issues.”

Bradley commented on the Dodd-Frank Wall Street Reform and Consumer Protection Act, which President Obama signed into law in July. The law,  named for its sponsors, former Sen. Chris Dodd, D-Conn., and Rep. Barney Frank, D-Mass., covers a vast array of financial institutions from small banks and thrifts to the insurance industry and giant Wall Street traders.

The law “made marginal changes but didn’t fundamentally change the system,” he says.

“There’s too much of a possibility for banks to use depositors’ money to speculate. There’s too much leverage in the system. There is too much lack of regulation of derivatives. And unless these things are addressed we could have another meltdown.

“A really good bank will be able to survive, but how many really good banks that guessed right on everything were there?

“As I point out in the book, I think the financial crisis was the function of public policy mistakes” including the “Fannie Mae and Freddie Mac fiasco where we lent money to people who couldn’t afford to repay it, and the Federal Reserve keeping interest rates so low for so long,” Bradley adds.

He also criticized moneyed interests in Washington for “watering down” needed reforms.

“Money has prevented things from happening. During Dodd-Frank consideration, $318 million was contributed to politicians in Washington by the financial industry, $145 million was contributed by the healthcare industry, $75 million by the energy industry. So it shouldn’t be any surprise that we have watered-down financial reform.

“Unless we’re willing to do something about money in politics, we’re not going to have a political process that addresses the real concerns of the American people.”

Offering his take on Saturday’s election in France, in which socialist Francois Hollande defeated incumbent President Nicolas Sarkozy, Bradley says: “The dynamic was that Hollande ran a better campaign and Sarkozy hadn’t delivered.

“Hopefully Hollande will keep in mind [Francois] Mitterrand [the last socialist president of France], who went way left when he came in and then pulled back and stayed in the center. That’s where I hope Hollande will be.”

He adds that the election could ultimately have repercussions in the United States if it leads to the collapse of the euro: “If the euro crashed I think that would feed back to the United States in terms of worsening unemployment.”

To buy a copy of "We Can All Do Better," please go here.

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