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Quest Means Business
Clinton: I Will Make the Economy Work for Everyone; Republicans Urge RNC to Dump Trump; Record Close for U.S. Stocks; Macy's to Close 15 Percent of Stores Nationwide; Egypt Gets $12 Billion Bailout from IMF; Analysis: Clinton, Trump Will Increase Debt; Arianna Huffington Is Leaving the Huffington Post; Uber Drivers in London Will Have to Learn English
Aired August 11, 2016 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, CNN ANCHOR: The market is closing at a record. It's up 117 points. Just over half of the 70 point went up straight out of the gate.
He's preparing for the gavel. This better be good after this lead-up. For such a market, we would have thought we would have got better. I'm
declaring that a wimpy gavel, on Thursday, the 11th of August.
Tonight, don't give him a break. Hillary Clinton tears into Donald Trump's tax proposals. A black Thursday for Macy's. America's most famous
department store is closing 100 shops. And the last post by Arianna Huffington. She's leaving the website that bears her name. I'm Richard
Quest. We have an hour together to put all this into perspective. And of course I mean business.
Good evening. Today Clinton-onomics took on Trump-onomics in the battle of the presidential election. Barely days after the Republican nominee gave
us his economic plan in Michigan, Hillary Clinton was there and revealed her vision. And in doing so, she gave us the Clinton economic plan and in
doing so delivered a blistering critique of her opponent.
Now, there were many strands to the Clinton plan. Indeed, there's no one overarching proposal that you can grab hold of. Let's start with what she
said about the question of trade. On trade, she has pledged to stand up to China, and in doing so she's going to appoint a new post called the chief
trade prosecutor whilst tripling the number of enforcement officers. But this is new. She said that she would be in favor of targeted tariffs in
those cases where countries broke trading rules. And when it comes to the Trans-Pacific Trade Partnership, she is in agreement with Donald Trump.
(BEGIN VIDEO CLIP)
HILLARY CLINTON, U.S. DEMOCRATIC PRESIDENTIAL NOMINEE: My message to every worker in Michigan and across America is this. I will stop any trade deal
that kills jobs or holds down wages, including the Trans-Pacific Partnership. I oppose it now. I'll oppose it after the election. And
I'll oppose it as president.
(END VIDEO CLIP)
QUEST: And it needs to be remembered that earlier on, of course, she was in favor of it. But Mrs. Clinton has always said that was before she saw
the final structure. On the question of infrastructure, which seems to be the backbone of much of her proposal, there is massive proposed increases
in infrastructure. The analysis of the plan, which would include tax breaks for cities and for states and for individual businesses creating new
jobs, would create 10 million new jobs. Mrs. Clinton claims that Donald Trump would cost 3.5 million jobs. We're going to fact check for you in
just a moment. Because it is a crucial part of the election campaign.
The elephant in the room, of course, is Donald Trump himself. Now, when it comes to Mr. Trump's plan, which we heard on Monday, with his three tax
brackets, with his elimination of the estate tax, with his raising the childcare tax deduction to unlimited levels. Mrs. Clinton said take his
total plan and it would cause a recession. She says it opens a loophole. She's referring to the pass-through and the carry-through taxation of
companies and individuals, which would, she believes, allow Donald Trump to halve the tax rate on the income from his companies. Most importantly, she
attacked him for the lack of specifics.
(END VIDEO CLIP)
CLINTON: What are the differences between Donald Trump and me? Is I'm telling you what I will do. I'm laying out my plans. And I will stand by
them and want you to hold me accountable for delivering results.
(END VIDEO CLIP)
QUEST: So we need to put it all into perspective, particularly this idea of who creates the most jobs. The CNN reality check team and the fact
check team has been looking into this in some detail. Cristina Alesci is here.
CRISTINA ALESCI, CNN CORRESPONDENT: Hi, Richard.
QUEST: There was a long speech, 12 pages or something of it. What are you going for particularly, what did you look at?
ALESCI: Well, there are number of things I want to go for. But on this question of whose plan would create more jobs. Clinton keeps saying 10
million jobs would be created under her plan versus a loss of 3.4 million as you pointed out on the screen. But you have to kind of dig a little
deeper into the Moody's report to get to the bottom of what's what, right? If left alone, the economy itself, whether -- if Donald didn't implement
any of his policies, if Hillary Clinton didn't implement any of hers, the economy alone would generate 7.2 million jobs.
What Hillary is talking about is under her plans, essentially it would generate an extra 3.4 to 3.6 million jobs. That 10 million figure is the
economy working on its own right now plus the extra incentives she would provide. Now, on Donald Trump's side of things, she's cherry picking the
numbers in the time frames a little bit, because Moody's says if you do apples to apples comparison of the time frames, you're looking at a decline
of about 400,000 jobs for Trump versus the 3.4 that she cited.
QUEST: So true but misleading.
ALESCI: Exactly.
QUEST: What else did you find in the plan? When I was listening to the plan, I mean, they're both long on rhetoric, but at least Donald Trump has
some very eye-catching proposals. It's hard to get excited by the income earned tax credit for working -- which might be very important, and I'm
sure working families -- but when you look at the plans and you just see them, his is more exciting?
ALESCI: Maybe. I mean, I think Bernie Sanders supporters are pretty excited about the Buffett rule, right? She's talking about a minimum
amount of taxation on anybody with adjusted gross income of $1 million. Anyone who makes that amount of money will be taxed a minimum of 30
percent. This has got very rich people in this country very nervous, right? And this is the point of distinction that she was trying to make
throughout her entire speech.
Hey, Donald Trump says he's for the little guy, but read his tax plan, because if you dig a little bit deeper on the details that we do have, it
would seem to be that the benefit flows for the most part to the upper income brackets, not to the middle class. And Hillary is saying, look,
under my plan, 98 percent or 95 percent of Americans won't see new taxes. It's that top 5 percent that I'm going to tax the heck out of and I'm going
to make sure that they are paying their fair share. But for whatever reason, Donald Trump's message about I'm for the little guy is resonating
and her message that she's for the middle class is somehow not resonating. Because he's doing better in the poll numbers than she is when it comes to
the question of who will generate economic activity.
QUEST: Because if you just lower the rate of tax as he is suggesting, that does look better until people question how much income tax do I pay, what's
my nominal versus effective rate.
ALESCI: Exactly, thank you, Richard.
QUEST: Good to see you, we'll require your duties many more times before the election.
Alan Blinder, calls Trump's tax plan has been called a gift to the super rich. Mr. Blinder's served as vice-chairman of the federal of governors
and joins me now. You heard the plan. It's full in its details. The question is does it resonate. Will this be the sort of plan that creates
the excitement necessary to get ordinary people to say it's a plan we want to work with? Alan Blinder can you hear me? We appear to be having a bit
of trouble with Mr. Blinder.
The Trump campaign has already responded. We will be coming back to Mr. Blinder, my apologies to him, that he can't hear us at the moment. The
Trump campaign has responded already, saying, right now the American economy is only working for the rigged system in Washington and on Wall
Street. Yet Hillary Clinton is running to keep things as they are. Clinton's plan today will short-circuit our economy by raising taxes,
increasing spending and killing jobs. Joining me now, Peter Navarro, economic adviser to Donald Trump, also an economist and business professor
at the University of California at Irvine. Let me check that you can hear me. Can you hear me?
PETER NAVARRO, BUSINESS PROFESSOR, UNIVERSITY OF CALIFORNIA IRVINE: I can hear you so loud and clear, it's wonderfully refreshing, I feel like I'm in
a Shakespearean theater. Well done, sir.
QUEST: Let's hope it doesn't turn into a tragedy before we're finished. Of Keynesian proportions, sir. The reality is what Mrs. Clinton pointed
out today is that her plan does give more benefit to more ordinary people, bearing in mind that the consensus is, Donald Trump's plan benefits the
better off.
NAVARRO: All right, let me see if I can make this really simple. Under Trump's plan, everybody gets a tax cut. Under Clinton's plan, everybody
gets a tax hike. Now, let's do a little fact checking. I love this fact checking. I'm going to say some things and later on your people can fact
check me. We start with the fact that all of Clinton's numbers were generated by Mark Zandi, who she did not name by name, but who is a major
contributor to the Democratic Party and Hillary Clinton, number one. Number two, --
QUEST: Sir, there's nothing wrong with that.
NAVARRO: Nothing wrong with that. Oh, --
QUEST: Provided the numbers are correct.
NAVARRO: There is something wrong with that, because she said that he was an adviser to John McCain, trying to imply he was a Republican and an
independent. That was a cooked deal. There's lies, damn lies, and statistics from Mark Zandi. Let me give you a couple of more. South
Korean trade deal which secretary Clinton negotiated. She promised that it would create 70,000 jobs. It cost us 75,000 jobs and doubled our deficit.
NAFTA. She promised us 200,000 jobs would be created by NAFTA. We've lost 850,000 jobs so far and our trade deficit went from zero to $60 billion. I
could go on and on with this. The point is that whatever she said today, there's absolutely no credibility. Plus, this whole idea she's going to
crack down on China? This is beautiful. The guy who negotiated the deal with China that's gotten America and Europe into such a mess is named Gene
Sperling. He is her chief trade adviser. And he's the guy that made this whole mess to begin with. How is she going to get tough at China with him
at the helm?
QUEST: All right. We can parse the numbers as you rightly point out, backwards and forwards, to some benefit. But fundamentally, coming back to
this idea that Hillary Clinton prosecuted today, let's take the estate tax which she says gives Mr. Trump and his family a $4 billion benefit, but
doesn't benefit 99.8 percent of America. She has a valid point with this estate tax. People always bang on but it but actually it really does only
benefit the much better off, the truly wealthy.
NAVARRO: If you look at who the estate tax really applies to, it's a lot of small businesses and medium-sized businesses, family-run businesses. So
what it is, it's a tax on that. So I'm not buying that at all. In harkening back to one of your countrymen, what I saw today was basically a
Keynesian style approach. Basically the whole thrust of her plan, my friend, is to tax the rich, tax the middle class, tax businesses, use those
funds to make this massive government spending investment in infrastructure. And then hope that somehow that ignites economic growth in
the rest of the economy just like John Maynard Keynes said it would in 1930s. Well, guess what, this is the 21st century and our businesses in
America are just beaten down by taxes and regulation. The Clinton plan is old deal, Robin Hood, Keynesianism. It's just not going to work.
QUEST: Can I put something to you, and I'll freely admit we have not given you notice of this but it's only happened in the last few moments.
NAVARRO: Here we go. Off the news cycle.
QUEST: No, no. I think you'll find by the end of the day this will be the news cycle. CNN, we've obtained -- there's a letter now going around from
a group of former Republican Congressmen, which they're going to deliver to the RNC, urging the RNC to pull its support for Donald Trump. The letter
to the RNC says, given the catastrophic impact that Donald Trump's losing presidential campaign will have on down ballot Senate and House races, we
urge you to immediately suspend all discretionary RNC support for Trump. I've only just read this. You're only reading it at the same time and
hearing about it at the same time. But I think we both can say it's not going to happen. But can recognize the dynamite nature of it.
NAVARRO: But let's understand what's going on here. Every 50 or 60 years or so in America, we have a reformation of our political parties. That's
what's going on here. And if you look at the Republican wing that Donald Trump is blowing up, doesn't want anything to do with, there's two elements
to it. One is the foreign policy regime change, nation building kind of thing that's turned the Middle East into a powder keg. Hillary Clinton
spends billions of taxpayer dollars, getting ready of Kaddafi in Libya, now we've got ISIS controlling it. Republicans were part of that.
The other part is the economy. These Republicans are the ones who banded together with Hillary and Bill Clinton to basically do all these bad trade
deals that pushed all our manufacturing offshore. So those Republicans -- Donald Trump will wear that kind of thing like a badge of honor, because
those are the people who have wrecked the Republican Party and made it possible for him to rise.
QUEST: Professor, we look forward and we invite you always on to QUEST MEANS BUSINESS to joust and put the point of view. Thank you, sir.
Now we must return to Alan Blinder in Princeton. He served as the vice chairman of the Federal Reserve's Board of Governors. My apologies to you,
sir, that you were unable to hear us initially. But I can see that you can now hear me.
When you heard Mrs. Clinton's speech today, the Republicans have immediately fired back that it is the traditional tax and spend and that
eventually everybody does pay more taxes, and surely they have a valid point when you look at the plan.
ALAN BLINDER, FMR. VICE CHAIRMAN, FEDERAL RESERVE BOARD: They do. But you've got to look at who pays the taxes. There are no taxes for -- no
additional taxes for anybody earning $250,000 a year or less. I think that covers most definitions of the middle class. As you were just saying with
Mr. Navarro, a truly tiny sliver of people, a truly tiny sliver of people, would pay a lot more estate tax under Clinton than under Trump. Trump is
the one who wants to change it, by the way, to let those people off the hook.
The biggest difference, however, by far I think, although nobody has run the numbers yet, including me, is what she is now calling the Trump
loophole, which is this, that under the current system, pass-through entities, LLCs, limited liability companies, small businesses, some of them
not so small, but not giant corporations, the income passes through to the owners and gets taxed as personal income to the owner. I'm such an owner.
I'm a part owner of a small business. It shows up on my tax return. I pay personal income tax on it. He wants to cut that rate to 15 percent, 15.
It's now 39.6. And that will be enormous benefit, I imagine, if Trump pays any taxes, that will take care of it.
QUEST: Do you not feel, though, that the fact her plan lacks a big idea? It's got philosophy underneath it but it lacks the big Trumpian, I'm going
to slash the seven bands to three, I'm going to abolish the estate tax, I'm going to put an unlimited level on the childcare. What she has is a plan
that's got huge detail but doesn't generate excitement.
BLINDER: That may be right. But if there's one idea, it is to raise the taxes of the very rich, people over $5 million a year, who are going to pay
a 4 percent surtax over their current -- and the Buffett rule. The Buffett rule has a lot of attention and has a certain cachet to it, I think. The
way Warren Buffett put it, it was wrong for his marginal tax rate to be lower than his secretary's. I think most people agree with that.
QUEST: Are we heading to a situation where it's now clear what the fighting ground on the economy is in your view. Both candidates have to
give more specificity, but that usually comes down in the websites, down deep into the websites of each plan.
BLINDER: Not on the Trump website. Go look for it. I have.
QUEST: It's still early days. Sir, when you have crunched the numbers, as we move forward, we'll be grateful if you come back to talk us more during
the course of the election. Thank you very much indeed.
BLINDER: Thank you.
QUEST: Alan Blinder at the Woodrow Wilson School at Princeton, former Fed Governor.
Another hit for the embattled retail sector. The major U.S. retailer Macy's has closed 15 percent of its stores. Now turning for 10 of
thousands of retail workers that have been laid out already this year. In just a moment. QUEST MEANS BUSINESS, good evening.
(COMMERCIAL BREAK)
QUEST: Welcome back. The Dow Jones Industrials reached a new record close. That's worth a bell. 117 points, at 18,613. It was a report from
the international energy agency the IEA, that said the world's oversupply of oil is falling. Remember, we had U.S. numbers showing production was
roaring ahead. We had seen prices starting to come down.
The iconic department store is closing 15 percent of locations worldwide. It's Macy's, one of many bricks and mortar retailers trying to adapt to an
online world. The first store was in 1858 here in New York City. Herald Square, in 1902, the flagship moved to Midtown. It takes over an entire
square block, 1 million square feet of floor space. It says it's the largest department store in the world in terms of single block. I'm not
sure about that, whether Herod's is -- well, I don't know. Somebody will no doubt write in and put me right. Whatever, Macy's is famous for its
annual Thanksgiving Day Parade. A tradition that began in 1924. Now a hundred stores are to close. Retailers are surging and eating into the
bottom line. Paul La Monica is with me. But Macy's has also bought various competitors over recent years. The stores always seem to be busy
if not exactly delightful to operate in. What's gone wrong, why can they not compete whereas H&M --
PAUL R. LA MONICA, CNN MONEY CORRESPONDENT: Zara, Forever21.
QUEST: Yes. Why can't they?
LA MONICA: There are a couple of things at play here. One, the nation is over-stored. You talked about the iconic Herald Square location. I did a
Facebook live a few hours ago outside of it, there are plenty of tourists there. There are plenty of New Yorkers there. That store is not going
away. But malls throughout the country are struggling to attract consumers, especially these broad department stores that are getting
squeezed by price, not just from Amazon, but also the H&Ms of the world. Even Walmart, which has had a bit of a resurgence this year. So it's a big
problem for Macy's, for Sears, for J.C. Penney. Nordstrom though did report good results just a few minutes ago after the close and that stock
is surging as well.
QUEST: All right, now Nordstrom is a store that found its niche. It was the famous story that would tell you go somewhere else if they didn't have
it. But it's always had that cachet. In the same way that Saks Fifth Avenue has had a cachet. Macy's is perhaps a store looking for a purpose.
LA MONICA: Definitely. I Think That Macy's is struggling to find a new identity. It is very tough to do that in this world where, let's be
honest, I bought almost all of my Christmas presents last year on Amazon. Forget about "Miracle on 34th St." Jeff Bezos is my Santa Claus. And I
think a lot of Americans feel that way as well. It's a big problem for Macy's and other department stores.
QUEST: I buy socks and underwear online. If I want to buy anything else, I want to touch it. I want to feel it.
LA MONICA: But I'm talking about presents for the kids. That's a different story.
QUEST: You knew what you wanted to buy.
LA MONICA: I did, exactly.
QUEST: So You Weren't Browsing.
LA MONICA: What you do is you browse in the retail stores, and then you take out your phone, and you order from Amazon. It's a huge problem for
traditional retailers.
QUEST: Which is why Amazon's shares are up at 700 and something.
LA MONICA: All-time high like the rest of the market.
QUEST: Sir, what is a word -- where was the one with the market gone. It was going to be out a minute age. Now, the market was up at an all-time
high. There's no valid reason on an average Thursday in August for it to be roaring up, is there?
LA MONICA: Not at all. It's oil and consumer spending.
QUEST: Oil and consumer spending. LA MONICA: Thank you, sir.
QUEST: As we get to Christmas, I know what to do, I'll just send you the hyperlink of what to get me. Paul La Monica.
Egypt's economy, which is well and truly in trouble is getting a lifeline from the International Monetary Fund, in the form of a massive bailout.
It's a $12 billion emergency loan, and the payments to be spread over three years. Egypt is running record deficits. Foreign country reserves have
fallen very sharply since 2011. And of course, as it's an IMF program, in return for the money, there's a series of reforms from the Egyptian
government, both structural, governmental, economic reforms. I spoke to Chris Jarvis, who's the IMF mission chief for Egypt. He joined me on the
line by Skype and asked him, why the IMF is so confident to loan so much money to Egypt.
(BEGIN VIDEOTAPE)
CHRIS JARVIS, HEAD OF EGYPT MISSION, IMF: The government's got a good program which is designed to produce economic stability in Egypt, which is
important in itself, and which is also essential for growth. And growth in Egypt is essential to create jobs, which is really important in an economy
in Egypt's position, which has very high unemployment, and especially very high unemployment among young people.
QUEST: So what are they going to use the money for? And I realize it doesn't all get paid in one go, it's paid over time, it's conditional on
economic reforms. But what will the money be used for?
JARVIS: The money will help them get through a process of adjustment where they bring down their balance of payments deficit and bring down their
fiscal deficit. The money will be lent to the Egyptian government at a pretty low interest rate, because the IMF can afford to lend at low
interest rates. That will enable them to borrow less from their own commercial banks, which is one of the things that will help make more
credit available to the private sector. It would also help with their balance of payments, as they gradually adjust that to a position where
they're sustainable and don't need either for budget or balance of payments purposes to borrow from the IMF anymore.
QUEST: The reserves of Egypt's Central Bank have dwindled quite considerably over the last five years. Why is that the case? Is that
because they're having to support the currency, they're having to go into the market and support their own currency?
JARVIS: It's really because there isn't a match between the supply and demand of foreign exchange in Egypt. One of the things that we would like
to see is a more market oriented exchange rate. That's something that the Central Bank of Egypt would also like to see. They don't like dwindling
reserves either. So the idea is that there will be a more flexible exchange rate, and that the exchange rate will find a market equilibrium
where people are able to sell foreign exchange as well as buy.
QUEST: Now traditionally when the IMF lends, of course, you always have provisions within it for monitoring of these reforms. What's going to be
the barometer of success here?
JARVIS: Well, we are going to want to see an improvement in the external position. Reserves are beginning to increase again. We'll want to see the
budget deficit coming down. There's a plan to bring down the budget deficit. The primary deficit, which is what we're focusing on, to improve
it by 5.5 percent of GDP over three years. And we also will be looking for the government to implement its structural reform program. And by that I
mean reforms that will improve the business environment in Egypt, where they rank pretty low in most indices at the moment. Also reforms which
give more opportunities to create new businesses, more opportunities for women and young people to find jobs. Those are some of the important
structural elements of the program.
(END VIDEOTAPE)
QUEST: Now the candidates have laid out their plans. While they both increase the debt. And they say there's a large gap between the two.
We'll talk about the debt aspect of it in just a moment.
(COMMERCIAL BREAK)
QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. When the billionaire Wilbur Ross tells us why he's backing
Donald Trump on economic grounds to be the next president. And why officials in London want Uber drivers to take English lessons before they
get behind the wheel. Before that, this is CNN. And on this network the news always comes first.
One person is dead in twin bombings in the resort town in Thailand. Two bombs went off late on Thursday in the popular town of Hua Hin. Police say
a number of people were injured. At least two tourists were also involved.
Hillary Clinton has attacked her opponent's economic plan in a speech in Michigan, saying Donald Trump's proposed tax cuts would only benefit him
and his wealthy friends. She also said Trump is afraid to stack up American workers against the competition.
(BEGIN VIDEO CLIP)
CLINTON: If team USA was as fearful as Trump, Michael Phelps and same Simone Biles would be cowering in the locker room, afraid to come out to
compete. Instead, they're winning gold medals.
(END VIDEO CLIP)
QUEST: Talking of gold medals, in Rio Britain's Justin Rose has become the first golfer in history to hit a hole in one at the Olympics. He hit a
191-yard ace in the first round of the men's tournament. He's tied in fourth place.
In the pool, Russian swimmer Yulia Efimova has her chance to get her first gold medal in the games. She's to race in the 200-meter breaststroke final
later this evening. Her American rival, Lilly King, was eliminated.
So this week has been the week of economics from both candidates, and they have now both revealed their plans to us. Here's how much will go on the
U.S. credit card as a result. The U.S. currently has debt forecast of $29.1 trillion. Under -- that's the current one. Now, under the Clinton -
- if nothing else changes, by 2026, that is what will happen. $29.1 trillion. Under Mrs. Clinton, her plan announced -- it might have to be
adjusted from what we've heard today, but it goes to $29.6 trillion.
Under the Donald Trump plan, $39.5 trillion. So according to the Committee for Responsible Federal Budget, the Trump plan dramatically adds to the
deficit. The Marc Goldwein is the senior vice president at the Committee for Responsible Federal Budget who came up with these forecasts. Mark, I
understand and accept that you got new figures from Monday from Mr. Trump with his higher tax brackets and you've heard from Mrs. Clinton.
Have you heard anything that substantially alters your view that the Trump plan dramatically adds to the deficit and is that insignificant?
MARC GOLDWEIN, SVP, COMMITTEE FOR RESPONSIBLE BUDGET: Well, we previously estimated the Trump plan would add about $11.5 trillion to the deficit.
Maybe it's a few trillion lower now, but we still think he's going to have trillions of dollars of cost. And we still think Secretary Clinton's plan
is going to be basically be neutral, only add to the debt what is already projected under current law plus a couple of hundred billion.
QUEST: Right and if we focus on the Clinton plan for a second. To make it pretty much fiscally neutral she's paying for her infrastructure spending
by what, the higher taxes on the rich, and by charging corporations more to bring the text back?
GOLDWEIN: That's exactly right. Clinton has a lot of new spending. And she pays for it almost entirely with a number of taxes on the rich and with
a number of taxes on U.S. businesses.
QUEST: But what about her increased -- not just infrastructure, but the extra credit she's giving, whether it's to working families or education or
all the other things that she's added into what the Republicans are saying is a tax and spend traditional Democrat plan?
QUEST: Well, Secretary Clinton does have some tax breaks. But many of them are really just another form of spending. What's the difference if
the government writes you a check or writes you a tax break? There's one new one today, she says she wants to expand the child tax credit. That
might add to the costs a little bit but won't change the underlying story.
QUEST: The underlying story of Donald Trump's is of course that these -- this big rewriting of the tax code de facto to reduce tax brackets,
eliminate certain taxes, even though they accept there will be an increase in the deficit, they point out it will have a dramatically simulative
effect on the economy.
GOLDWEIN: Look, we've looked at how much it would take for Donald Trump to balance the budget with his plan. He would need 10 percent annual growth
for ten years. The modern U.S. record for annual average growth is 5 percent. Our projections are 2 percent. It's ridiculous levels of growth.
It's just not going to happen.
QUEST: You say it's not going to happen, but he will point to the Reagan era, where I agree, deficits did rise, but there was an element of growth
in the economy that had not been seen before, and although there were some criticisms of the trickledown economics, there is a large body of opinion
that believe that was the engine of growth that took the economy forward.
GOLDWEIN: I don't want to dismiss tax reform. Tax reform can certainly help growth. But in the Reagan era we had 3, 3 1/2 percent growth,
sometimes 2, 2 1/2. We never had 10 percent growth and we never will have 10 percent growth for any sustained period of time. So is going to take
more than just growth to make these numbers add up.
QUEST: Just to be clear about this, I want to be clear, your organization's position on this, in terms of partisanship. Because I can
feel viewers about to write, they're tweeting me even as we speak, make it clear where you stand.
GOLDWEIN: We are completely nonpartisan. We like lower spending. We like enough tax revenue to pay for it. Sometimes we agree with Republicans,
sometimes with Democrats. Our board is mixed about 50/50. We don't have a dog in this fight. We just want a fiscally responsible government.
QUEST: Sir, thank you very much. We'll talk to you more as we go through this.
GOLDWEIN: Thank you.
QUEST: Now, it's very difficult putting all this together to make sense for you, because you hear so many competing claims, which is why it's
important that we have people like our last guest on. But it's also important that you hear from the truly wealthy, the true entrepreneurs,
those people who know what they're talking about when it comes to big business in the economy. Wilbur Ross is a billionaire investor known for
turning around failing businesses. And he is a solid Trump supporter. He told me that the debt projections don't consider the totality of Mr.
Trump's plans.
(BEGIN VIDEOTAPE)
WILBUR ROSS, CHAIRMAN & CEO, WL ROSS AND CO.: First of all, all the details of it have not been put out yet. They're going to be further
details put out. I'm not so sure they had enough information to come to a very real conclusion. The tax brackets on the individuals are quite
similar to ones that Paul Ryan has been talking about and the people in the Republican side of the House. So those are probably analyzable. But you
have to take the whole economic plan together. And the real questions are how much good will there come from reducing regulatory burden? A lot of
people think that's $100 billion a year. If it is, that's that much more taxable income that will be in the mix. And if it impedes business
decisions, which I think it does, that will make more into the economy. So you have to take it as a whole, not take an isolated piece of it and pick
it apart.
QUEST: On the question that essentially the wealthier gain because of the tax plan, I mean, it is undeniable that if you take, for example, the
estate, the abolition of the estate tax, if you take, for example, the unlimited childcare benefit that will be a tax deduction, they will benefit
people at the upper end.
ROSS: Well, of course. But why should people at the upper end just be penalized? It benefits everyone at every end.
QUEST: So you don't find it troublesome that the wealthier would gain disproportionately versus the middle class or the less?
ROSS: The reason they gain what you call disproportionately is they pay a higher percentage in taxes right now. That's the only reason.
QUEST: When we talk about business and the ability to bring back jobs, it's a wonderfully -- it's a wonderful economic goal and desirable goal.
But is it doable? Those jobs went overseas in most cases for reasons of globalization, not just because of NAFTA or trade agreements. They went
there because of a shift in the nature of the global trading system.
ROSS: You can't separate the one from the other. NAFTA is part of the reason there was globalization. China's accession to the World Trade
Organization is part of the reason there was globalization.
QUEST: But the ideal that you're suddenly going to have coal mining in Pennsylvania again and shoe manufacturing across America, as a realist,
sir, you know that's just not economically viable.
ROSS: It's not economically viable with the EPA requirements that the Clinton program continues to impose. That's probably true. And that's one
of the reasons that Donald Trump plans to cut back on a lot of these burdensome regulations.
(END VIDEOTAPE)
QUEST: That's Wilbur Ross, the billionaire. We've done a lot on the issue of the two competing economic plans because it is at the core of the
election, in many ways. We'll talk about that in our newsletter today. The newsletter is being sent out even as we speak. Hillary's smorgasbord
economic plan, my Profitable Moment there. Have a read of it if you're not subscribed you really should do so now. It's arriving in your mailbox any
time. No markets are trading so you can digest the full blurb and takes that we've got and look forward to the future of tomorrow.
CNNmoney.com/quest.
She is what put the huff into Huffpo, and now Arianna Huffington is leaving her publication to her next venture. Brian Stelter joins me next.
(COMMERCIAL BREAK)
QUEST: The Huffington post will have to carry on without the woman who gave the website its name.
Arianna Huffington is stepping down as editor in chief of Huffpo. And she will devote her full attention to Thrive Global. It's a new health and
wellness company that she's launching. Huffington became a conservative media personality, Arianna, in the 1990s. When her then-husband ran for
Senate as a Republican. There as a political commentator, there's a wonderful picture of her from 1994.
Her political leanings would later change. And she ran for governor of California as an independent in 2003. But it was in 2005 she co-founded
Huffpo as a liberal news blog. It was meant to be an answer to the conservative sites that were dominating the internet at the time. By 2011,
26 million people were visiting Huffpo every month. It prompted the sale to AOL for $315 million. AOL, of course, itself majestically moved on.
Brian Stelter is here. Brian, we both known Arianna Huffington for some years. The woman is a firecracker by any definition. What's this all
about?
BRIAN STELTER, CNN SENIOR MEDIA CONSULTANT: Well, she has been running this site for over a decade. She's picking a very opportune time to leave.
Because there's changing happening within AOL and its parent Verizon. The Huffington Post has had some squabbles over the years with its parent
company. And now it's about to get more complicated, because Yahoo Is being bought by Verizon. So soon AOL and Yahoo in the Huffington Post are
all going to be in the same corporate family. There's probably some changes coming to the Huffington Post as a result. And she's stepping
aside now allowing the company to go through those changes without her being there.
QUEST: One has to give Arianna absolute credit for starting something, driving it forward. Huff post is a jolly good site.
STELTER: One of the biggest sites on the entire world wide web. She was able to create this partly through sheer perseverance, partly through
intimate knowledge of Google search. Making this site bigger and bigger and bigger, and by recruiting lots of her famous friends and other writers
to write, most time for free. But it also has hundreds of paid staffers who produce great journalism. So even though some of it is left leaning
and she's famously taken a stand against Donald Trump and she said she will continue to do that by the way, the site is now much bigger than herself.
It will continue to be the "Huffington Post" even though she won't be a part of it.
QUEST: She's just written a book on sleep. It's a very good one. And she's messianic on this issue of getting seven hours of good sleep. So
this new venture, where does it fit in?
STELTER: Thrive Global, it'll be doing workshops and other sorts of teaching opportunities, trying to encourage people to focus on wellness,
pay more attention to themselves and their bodies in this 24/7 workplace environment that a lot of us experience. The roots are in the Huffington
Post. In the coverage that it has had of these topics. Thrive Global will be launching in November. She told me this morning, she reached a
conclusion this summer that there was no way for her to be both jobs at the same time. She has to focus on the new job. But I believe part of this
probably is about the Yahoo situation as well. There are changes coming to AOL, and it makes sense for her to step aside and let the new company do
what it's going to do.
QUEST: Final thought. And I say this with huge respect for Arianna Huffington, they just don't make them like her anymore.
STELTER: She's been able to reinvent herself three or four times. You're absolutely right. A larger than life figure. And I don't see a crop of
people like her one generation below, I don't see them coming up the ranks.
QUEST: I mean, whether it's the Hearsts or even the Murdochs, they have an idea, they go out and persevere to prosecute it and it works.
STELTER: Maybe ten years from now we'll be sitting here and will be talking about the next Arianna. But I'll be surprised.
QUEST: Good to see you, sir.
STELTER: You to.
QUEST: You better get off because you've got your reliable sources.
STELTER: My nightly media newsletter, yes. Yours is perfect and then a few hours later mine comes out after yours.
QUEST: Yours is CNNmoney.com/media is where Brian's is. If you're not signed up for both of them will ask questions after the break.
When we continue, we're going to talk about how Uber. And how Uber drivers in London will be required to have a certain knowledge of the Queen's
English, after you've enjoyed a moment to MAKE, CREATE, and of course INNOVATE.
(COMMERCIAL BREAK)
QUEST: Private hired taxi drivers in London who are not from dominant English speaking companies will have to pass an English exam or risk losing
their jobs. It's the mandate that's been handed down from TFL, Transport for London. TFL says tests are to ensure safety on the road. Uber is
pushing back and is calling on the London Mayor, Sadiq Khan, to reconsider. They call the exam unnecessary.
It's called the B1 exam that Uber drivers from non-English-speaking countries will take. It's two hours long. It cost over $250. Now these
are the questions. So for example, it's the written part of the test. "Write an article for your teacher about a film that you've enjoyed. Write
about 200 words. Where you saw the film. What the film was about. Why you enjoyed it." And there's also part of the test that also deals with
listening and speaking English. Needless to say, the idea of a test for these drivers has people, particularly the Uber company, extremely angry.
I spoke to Garrett Emmerson, TFL's Chief Operating Officer, who defended the rule saying it's the same standard that the British government has for
many of its customer-facing employees.
(BEGIN VIDEOTAPE)
GARRETT EMMERSON, CHIEF OPERATING OFFICER, TRANSPORT FOR LONDON: It's the same standard as the home office requires for customer-facing jobs in the
U.K. And I think that's the key difference, is that private hired car drivers are dealing with the public, and our primary responsibility as a
regulator is to ensure they're safe.
QUEST: They're customer-facing jobs for the government, can be dealing with extremely complicated issues of social security, social services,
going to a help center, and things like that. You're hardly likely to get the same sort of requirement of depth, surely, if you're an Uber driver.
EMMERSON: Well, I think it depends on many things, really. It depends on the nature of the journey you're making, the particular needs of the
customer, for instance. And as I say, particularly the ability to understand written instructions and the terms and conditions of the
license. The legislation governing private hire driving in the U.K. is fairly complicated. The definition of touting and applying for higher, for
instance, requires a degree of nuance to be able to understand accurately the law as it stands. We think it's appropriate that drivers should be
able to understand these things.
QUEST: In terms of what others are saying, the criticism is that it's a protectionist move, it is a move that is designed of course to preserve the
area for the black cabs and for those other licensed drivers.
EMMERSON: Well, I think, you know, we've made it very clear from the outset, and as I say, we've been consulting for the last three months.
We've done three rounds of public consultation. Over 80 percent public support, incidentally, for this measure. And we've also had independent
impact assessment analysis carried out. And it's something that's been debated at considerable length by the Transport for London board. We've
come to the conclusion that we do require measures like this to ensure the safety of our customers.
QUEST: We went on the website, as I'm sure just about every journalist and everybody has, to look at the B1 level, and we did the listening part and
the grammar part. But the written part where it requires you to write an essay for your teacher about a festival in your country or you're going
into town to study at a college, write a letter to your friend.
Mr. Emerson, do you really think that's necessary for someone who wants to drive a car, to be able to complete that level of certification?
EMMERSON: As I say, I think it's not just about driving a car. It's not just about conversing with a customer. It's about being able to understand
and respond to questions in relation to fares, in relation to routes. It's about reading maps. It's about understanding written instructions, for
instance, that a customer may have. It might be understanding special requirements the customer may have, a disabled customer of some
description. It's also about being able to engage with ourselves as a regulator, understand the regulations and the requirements, respond to
directions that we from time to time may issue, and to understand the law as it applies to private hire driving in London.
(END VIDEOTAPE)
QUEST: TFL's director. We'll have a Profitable Moment after the break.
(COMMERCIAL BREAK)
Tonight's Profitable Moment. In the office we've been arguing all day about Uber's new opposition to new restrictions that Uber drivers in London
will have to have a certificate showing that they can read, speak and understand a certain level of English. The so-called B1. Some of my
colleagues believe it's simply unfair and it's a protectionist measure against Uber in favor of other traditional drivers. Others believe, no, if
someone will drive me around the city, I want them to be able to speak the language and understand that which I'm trying to say. Where do I come
down? Probably in favor of the new regulations. It just seems like common sense. And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in
New York. Whatever you're up to in the hours ahead, I hope it's profitable. We'll be together tomorrow.
END
