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Euro Pacific Capital CEO Peter Schiff on Americans' dependency on the government and how it will impact the elections.
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Much to talk about the economic reality and the political fallout first to Peter Schiff CEO of Europe Pacific capital Peter your take.
Of course Mitt Romney is absolutely right that a significant percentage of president Obama's voters.
Have in fact been bought or paid for.
You know they now depend on on the welfare state because of the adverse effects that it's had on the economy in -- perverse effects it has on individual incentives.
Government programs breed dependency are I don't Romney is right he's not the -- explain that in the 32 sound bite.
-- I have some numbers on that though Peter -- let's focus on number one at -- percentage of Americans can do not pay any net.
Federal income tax I'm not gonna get into the payroll tax I'm not gonna get and estate taxes sales taxes.
But up that percentage a lot of them don't pay federal income tax because of tax breaks that they get safe for having children and in that group.
They're bound me Democrats and Republican -- It's a legitimate issue to raise it more people need to pay federal income tax to fund just our defense for example.
But it's not gonna win you an election when you talk about taking something away from people.
Well I'd say I'd.
Say that who Obama is gonna win the lion's share of the vote among people who aren't paying income taxes after -- -- your message is lower taxes and you're not paying any income taxes what do you care all you hear about -- that's gonna reduce my benefits did most of the people who -- not paying income tax because they -- children it's because they're relatively war I mean if you're if -- upper middle class -- the middle class your children aren't -- eradicate your tax liability you have to have a pretty low income.
-- before aren't just having children is gonna completely eliminate your federal tax liability.
But a lot of people are getting checks from the government whether it's food stamps whether it's welfare whether Social Security whether to pension whether to paycheck.
And it's difficult to win the -- of these people if you're promising to take those checks away or diminish those checks and you don't have the ability to educate them so that they understand that they would be better off -- an economy that didn't have all those checks coming from the government warning and so why is correct -- focus on different voters.
The 49%.
Of Americans who get some sort of government assistance federal government assistance and that does include.
Includes everybody in -- household.
But it also includes people who get -- security checks.
And Medicare checks and again to the point because in many ways Paul Ryan's bid nitty gritty of his plan.
To try and reduce our spending and cut Baghdad has been sidelined to that point you cannot win a presidential election yes or no.
If you're gonna target yes well you know.
Entitlement problem -- where Republicans and Democrats debt.
If that's the problem you have with democracy -- delay Harry -- I think said -- Massey said the government is an expert.
-- breaking your leg and then handing your crotch and saying you -- without -- couldn't walk.
And it's difficult for -- to explain to the people we're now hobbling around on crutches.
Not that the government broke their leg before handed and that crotch.
And so he needs a teller free market story which is more nuanced and more complicated than -- can get to a thirty seconds sounds like that.
But you know the Democrats are gonna try to make out like Mitt Romney doesn't care about people were living off the government but he cares about him he just understands that getting their vote is gonna be difficult that -- he wants to be president he has to appeal to people who are paying federal income taxes and who are feeling the burden of the big government -- -- -- more likely to accept his message of making government.
Small yes or no before these problems are fixed it's going to -- and crisis.
Of the catastrophic proportions in terms of runaway inflation and higher interest rates -- -- Fortunately we're gonna get that catastrophic crisis the Federal Reserve is now guaranteed it with its operations screw otherwise known as QE3.
So this is coming we're gonna have this crisis and hopefully we do have an opportunity do the -- -- -- believe me it's gonna be -- -- when the bond market collapse -- the dollar collapses prices go through the -- Nobody wants that money that the Federal Reserve's restricting -- and then we have a real crisis that will make 2008 look like a Sunday school -- Housing -- yes or no answer -- -- thank you can't yeah I think -- then bailout by march all us.
