In an interview with former Clinton Labor Secretary Robert Reich on Monday's CBS Early Show, co-host Erica Hill wondered if higher gas prices in the wake of Mideast unrest were the result of some sort of fraud: "We've seen prices skyrocket....Is the public right to feel taken advantage of in some ways here, or even scammed?"
Even the liberal Reich didn't accept the premise: "Well look, a lot of this is supply and demand. The country can feel a certain sense of taken advantage of. But some of this is the demand that's coming from China. I mean, you have developing nations all over the world....And their oil needs are very high. And so they are also putting pressure on oil prices. It's not just the Middle East."
Hill never identified Reich as liberal or even informed viewers that he served in Bill Clinton's administration. She simply introduced him as an "economist and former U.S. Labor Secretary" and promoted his latest book: "...also the author of 'Aftershock: The Next Economy and America's Future.'" At the top of the show, fellow co-host Chris Wragge touted Reich as "one of the nation's leading economists."
Earlier in the interview, Reich warned of the damaging effect higher gas prices could have on the economy: "Americans are still trying to get out of the gravitational pull of the great recession....And so, the higher gas prices at the pump undoubtedly are going to be a blow. It's not going to dramatically slow down the recovery. But it could definitely slow it down." On Sunday's Face the Nation, New York Times columnist Thomas Friedman actually called for taxes to keep gas at $4 per gallon indefinitely, even while acknowledging the economic damage it could do.
Here is a full transcript of Hill's March 7 interview with Reich:
ERICA HILL: Joining us this morning from Berkeley, California, is economist and former U.S. Labor Secretary Robert Reich, who is also the author of 'Aftershock: The Next Economy and America's Future.' Good to have you with us this morning. As we just heard from [business and economics correspondent] Rebecca [Jarvis]-
ROBERT REICH: Good morning, Erica.
HILL: Good morning – she laid out that picture pretty well for us. The President can, of course, tap into these reserves. But if there is enough supply, as she pointed out, from an economic perspective, does it make sense to do this?
REICH: It probably makes sense to do it, or at least to suggest that he will do it to effect the price of oil futures. But I'll tell you, Americans are still trying to get out of the gravitational pull of the great recession, Erica. And so, the higher gas prices at the pump undoubtedly are going to be a blow. It's not going to dramatically slow down the recovery. But it could definitely slow it down.
HILL: And that perception may help a little bit. Libya, as we've talked about a number of times on this program, is the 18th largest oil producer. 18th. But we've seen prices skyrocket, as we just heard from Rebecca. Is the public right to feel taken advantage of in some ways here, or even scammed?
REICH: Well look, a lot of this is supply and demand. The country can feel a certain sense of taken advantage of. But some of this is the demand that's coming from China. I mean, you have developing nations all over the world who are coming out of the recession much faster than the United States and Europe. And their oil needs are very high. And so they are also putting pressure on oil prices. It's not just the Middle East.
HILL: Let's turn now and look at this latest jobs report. On Friday the Labor Department reporting that 192,000 jobs were added. Unemployment dipped to 8.9%. This had a very positive response it seemed. But you are a little bit more measured when you look at this and to you the headline here is not necessarily the jobs but the wages. Talk to us a little bit about that.
[ON-SCREEN HEADLINE: Employment Outlook; Reich: Mixed Messages From Job Numbers]
REICH: Well, 192,000 new jobs is very good. Let's not, you know, let's not say that this is a bad trend. This is a good trend. One of the problems, however, is that the new jobs we're creating, if you look at the 1.2 million new jobs created over the last year, those jobs, in general, are paying less than the 8 million jobs we've lost between 2008 and 2009, and the beginning of 2010.
And so the long-term trend is troubling. The long-term trend, Erica, is lower and lower wages and benefits. I mean you see it, a lot of people have had to give wage concessions to their employers, or provide give-backs, or say, 'Okay, we'll take a higher co-payments, deductibles on our health insurance. We don't want to, you know, we won't take quite as much pension. Or you don't have to contribute quite as much pension. Or we will be fired and we'll go on as a contract worker, and we'll do pretty much what we were doing before, but we won't have any of the benefits we had before.' And this is the story that's going on much around America, and has been going on for years now. But, the great recession accelerated it.
HILL: And the concern there, of course, is that it's really hard to come back from that. Appreciate your insight this morning. Thanks for being with us.
REICH: Thanks, Erica.
— Kyle Drennen is a news analyst at the Media Research Center. You can follow him on Twitter here.
