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Developed country. we can't afford it and we aren't going to be competitive if it keeps going this way. >> do you believe we don't have a debt and deficit problem? >> no. i think his point is when you look and see the big charts where the big red looming debt into the future, i always want to ask people, draw the line on what part of that is medicare. what part of that is health care costs. and we've seen that in terms of wage deflation when our wages don't cover. that's because health care costs have gone up. and because housing costs have gone up. used to be a third of all of our costs we sp...

>> well, i've said all along a lot of the things that have been discussed very openly on the floor of the senate, things like health savings accounts, reconnecting the consumer to the cost of health care, doing things with flexible savings accounts that were modified in obama care. i think we haven't done enough cost containment of health care. the president has said over and over again, we don't have a debt and deficit problem, we have a health care problem. we pay too much. we think by the end of this decade it's going to be 20% of what we do in our economy. that's too much. it's twice as mu...

The same happened in the recessions of the 1980s, '90s and early 2000s. but that correlation changed with the most recent crisis. this time steep jumps in unemployment with very limit impact on inflation. part of the reason why this happened is that central banks have taken on an unusually ak vis role in the last few years. the federal reserve and other central banks have pumped vast sums of money into the financial system. under normal market circumstances, that could lead to hyperinflation. but in the current scenario with very slow growth, with wage deflation, it has led to stability. u.s. ...

Unemployment with very limit impact on inflation. part of the reason why this happened is that central banks have taken on an unusually activist role in the-few years. the federal reserve and other central banks have pumped vast sums of money into the financial system. under normal market circumstances, that could lead to hyperinflation. but in the current scenario with very slow growth, with wage deflation in rich countries, it has actually led to stability. u.s. inflation has had a roughly steady at 2%, lower than the global average. this is a significant policy success and what it it means ...

Productivity and growth, high taxes and sclerotic state-owned companies. these are not the problems we face now. today american and european workers struggle to keep up their wages as technology and globalization push them down. wage deflation, not inflation, is the pressing problem. western economies face global competition with other countries building impressive infrastructure and expanding education and worker training. they face a two-track economy where capital does well, but labor does not. where college graduates strive, but those without strong educational skills fall behind where ine...