[ applause ] over the last ten ceo councils right at the top of your priority list, first has been tax reform and right after that, education. What you have meant by that is developing the skills and skills training to make sure that you have the workforce you need for the next decade. Finding people who bring into your companies that can execute the type of work that you need done in a new technological world. So how does the white house plan to address your concerns . Matt murray, the executive editor of the wall street journal is going to interview betsy devos, the u. S. Secretary of education, who is very much focused on this particular aspect of your agenda. So please join me in welcoming them. [ applause ] secretary, good to see you. Nice to see you, matt. I think its fair to say, first of all, that education for this audience over the years is probably always the number one concern for many people whenever we poll our executives. So i know theyre keenly interested always in the state of education. And weve already had a lot of talk at the conference over the last day and a half on things like a. I. , things like the digitization of the workplace, and disruption and changes that already are happening and that we all think are going to accelerate in the coming years. I want to start by asking you, you have been on the job now almost a year. Whats your overall assessment of the preparedness of u. S. Workers today for this world and the world thats coming . Your honest sense of where we stand on training our workforce. Well, let me say its first an honor to be here and to have a chance to talk a little bit about education today. And the specific question about preparedness of students for the reality of today and tomorrow, i think we have a lot of opportunity for improvement. There certainly are students that are leaving high school and college well prepared for the world that awaits them. But i think the reality is that much of the systems that we have been relying on in education for decades now really tend to be backward looking versus forward looking. And its my goal at the department to really bring a focus to in the k12 area, really empowering parents and students in a new way to find the education environment that is really right for them, that is going to stoke the curiosity that is innate in every child. And not sort of beat it off by the time theyre in third or fourth grade. And then when you look to beyond 12th grade, what are the myriad of pathways that really are available but not yet really highlighted or emphasized in any meaningful way. I think for several decades now, we have given the subtle or not so subtle message that the only successful path to adult life is through a Fouryear College or university. And i think thats been at the expense of lots of great opportunities. We know that 6. 1 million skilled jobs that require some level of Education Beyond High School are going unfilled today. And so the opportunity is really there to step back and look more holistically at those opportunities, starting as early as perhaps middle school, exposing kids to what some of these different pathways might be. So lets break it down. Lets talk a little bit about k12 and then we can talk about post k12. Just to be clear then. I mean, i dont know if you put a percentage on it, but when you think about how prepared, how many of our students are prepared for the world in the way you think they need to be, are half of them ready for this today . Is it probably lower than that . Is it just the students who get the opportunity to go to the private schools or the right Charter Schools or have a certain opportunity . Or how badly are we failing, do you think . Students everywhere in every school in this country, theres at least one or a handful of students that for them thats the right environment, and theyre being prepared and theyre being challenged in the right way. But when you think about the fact that kindergartners starting kindergarten this year face a prospect of having 65 of the jobs they will ultimately fill not yet having been created, you really have to think, i think, differently about what the role of education and preparation is. And in talking with a lot of Business People and others who have to ultimately employ individuals, the skills that we really have to be preparing kids with, i think, are simply put in four areas. Critical thinking skills. The ability to collaborate and work well with others. As we do in all of the rest of life. But not so much in school. The ability to communicate, both verbally and in written communications, well. And then creativity. And my observation of a lot of students today is theyre not having their needs met to be prepared in those areas. Theres a lot of tension on this issue. We have had a lot of programs over the years now from the left and the right, and from the government and from outside the government, whether its race to the top or common core, theres been a lot of ferment around it, but we dont really in the abstract seem to have moved the needle a lot. Why not . Why cant we really see that kind of change . Whats going wrong either with all of this with all of these ideas . I think we have tried to fix things from the top down. Theres been very heavy involvement on the part of the federal government in education for the last number of decades. With the hopes that we would see improving results and different results. And the reality is that our performance in aggregate, as compared to the rest of the world, has not only been stagnant, but its continued to slide. And so i think we really are at a crossroads, i believe, and i hope that a lot of the folks here today and those with whom you work will look differently at the way you enact, engage with and get involved with education. So thats actually a good segue to the poll question i want to ask, if we could put the question up. If we can just prepare it, i want to talk about the department as you see it. The Education Department, as we know from the time it started has been sometimes a lightning rod on both sides of the aisle. And its been talked about and written about for you that, you know, you have been cutting the budget. There are jobs you have not been filling. You have been streamlining the department. Whats your philosophy of what the department can do and what it shouldnt do . And how do you want that how do you want the role of the Education Department to be defined . I think theres a much larger role for states to play. It is the role of the states, and this administration is very embracing of federalism. The every Student Succeeds act that Congress Passed at the end of 2015, which is just now starting to get enacted really returns a lot of the flexibility and control to the states for k12 education. Right now, were receiving the plans. Reviewing them, and its my goal to approve every single plan that follows the law that Congress Passed. Now, the interpretations in those states will be different. And thats good. And we hope that states will take the opportunity to be creative in how theyre addressing the needs of students in their states. We also hope that states will work with their local communities and with local School Buildings to give the kind of flexibility thats needed to allow for new creative approaches to be taken and to be embarked upon. Okay, so our poll question, do you favor does the department favor taking a greater role in driving k12 agenda, lesser role . Looks like more of the audience is with you, although i see the numbers are still shifting around. Very dramatic to watch it. A lot of people changing their minds. Let me press on that a little bit. Because it also feels like theres always been, especially for the united states, from a national perspective, a tension between states and the federal role in terms of what should be standard for everybody and what should be localized. And thats a persistent tension point. Something common core was trying also to address. So, you know, and it goes to a larger question i think that you wrestle with because you like to highlight programs that you think are unique, programs that you think are great. You have talked about the new Charter Schools, private schools, you have talked about them in Public Schools. But what should be the minimal acceptable education attainment. There is a really inequality problem in our education system, isnt there . If you have money f you have luck, if youre in the right community, you might get a great one. Lots of people dont. How do we raise that floor . Well, the reality is that probably most of us, if not all of us in this room, have had the ability to choose our childrens educational settings. And the reality also is that there are many, many parents, a High Percentage of our population that dont have that power. We havent tried actually empowering parents to make those choices. And to pursue an education environment that is right for each child. That has, i believe, stunted the creativity in the Education World for decades, really. We still fundamentally operate on a model that was brought to us 150 years ago by the provisions,prussia prussians, a country that no longer exists sxrk we have not deviated from that proach, yet everything has changed. I believe if and when we empower parents to make that right choice for their child, that we will see the kind of creativity entering education that we really need to see, that will ultimately prepare students to be active participants in the workforce and i would argue even as important or more important to be job creators themselves. Is there a particular Public School model or community that you look at as an example of how the needle can move, whether its new orleans or some other place that you have seen that kind of creativity. A number of states have adopted some choice programs. And were starting to see some beneficial results in the states. Florida probably being leading among them. Louisiana has certainly adopted a form of choice. Its a little more limited in scope. Indiana is another state. Ohio, wisconsin. But all of these are still at relatively small scale. So we havent we have not had a state or a situation where every single parent in that state actually has the power to make that choice for their child. And i hope that some time in the not too distance future, well see that. When we reflect on what the role of the federal government and the department of education is, visavis the states, its important to remember that 90 of the funding comes from within the states. And yet i would say probably 90plus percent of the regulation has come from the federal level. And again, the results that we have seen with that entry into into that trying to make everybody conform to a one size fits all approach has not the results have not been positive overall for students in this country. And again, i mean, the critics of choice would say, well, thats all well and good if you get a chance to choose your school, but that still dooms many kids who dont get into the right school, they get into a worse school or a more minimal school. Isnt that a risk of choice . Again, we have tried it isnt one of those programs that has been tried in some places and we see improvement in the school here, improvement in a school there, but you still have a lot of kids kind of doomed to poor schools, right . How do you address that problem . I think fundamentally, if the demand is there, theres going to be response to demand. I would actually refer to florida, where again, theres the broadest range of choices and the greatest number of students taking advantage of those choices. Where there are districts that have a fairly High Percentage of students opting to go to a school other than their assigned school, all of the performance in that district has improved. So it says to me that with even more of those options and more of those opportunities, were going to see even better results ultimately. Okay, and then we were going to come back to post k12, and we were talking backstage about the fouryear degree. It sounds like you would like a world that has many more options for students than just thinking in terms of the fouryear degree. Tell us a little bit about your thoughts on how we can develop, i guess youre thinking about vocational schools and other options, pathways to careers and succe success. How badly are we lacking in other ways forward for students today . Well, first of all, i think we need to be honoring of those various avenues and various pathways. And i think to a large extent, we have stigmatized them for the last couple decades or more. And we have suggested that they are lesser than and not as good a choice as our options as a Fouryear College or university. And yet today, we know that only about 30 of students will ultimately ever graduate from a Fouryear College or university, and we have, as i mentioned, 6. 1 million jobs that require some level of Education Beyond High School that remain unfilled. And we have, you know, a lot of exposed to learning about those options and those opportunities at a much earlier stage, as young as and as early as middle school. What can you do, what can the government do specifically to seed and fund those . Is it all up to private enterprise, up to states, up to institutions . Or can you encourage them, whether its through tax policy or through other kinds of i think its really important for businesses to engage with their local Community Colleges, for example. Or other local institutions, if you have needs in your community that are going unfilled or in your business that are going unfilled, i have seen several examples, several great examples of Community Colleges that have partnered with industry in their region and have planned out curriculum and certifications to specifically meet those needs. And very often, i mean, i have talked to many students who have entered those programs and taken a year, nine months to a year of microdegree for something, and then they will go and work for a few years and come back for another level of education. And i think a major shift in Higher Education to the acknowledgment that there is really no traditional student fundamentally anymore. The percentage of students that go directly from high school to a Fouryear College or university and graduate in four years is the minority of the population. So really, again, giving honor and respect to all of these different opportunities and helping kids actually learn early on whether they like to work with their hands or whether they really do want to sit at a desk and do something that requires them to sit and think all day. I recall a young lady i met down in the orlando area who had been a clerk in a circuit court. And had done that for a number of years and became bored to death. So she went back to the local Community College and took a class and was now doing advanced manufacturing wiring for one of the Aerospace Industries in the area and couldnt have been more thrilled with the work she was doing. She said i love my job. I go there every day, cant wait to get there. Thats really thats really something for all of us, really. College is going to become, i suppose for many people, sort of a recurrent experience over your life if you want to retrain and try different jobs. So the system needs to adapt for that going forward, i guess, for different kinds of students. Let me ask you about yourself, if i can. Obviously, you have had some bumps at different times. In your tenure. You have had some tough criticisms from political opponents. And even at times, i think, doubts from supporters. And so you faced your skeptics at different moments. In just the last couple weeks, there were a lot of rumors going around you were thinking about stepping down. Are you thinking of stepping down . Absolutely not. Do you expect to be here for your full fouryear term . I do. Okay. The opportunity to try to make the Education Future better for kids all across this country, i mean, thats been my lifes work for 30 years. And the opportunity to try to do that in a different way is just an unbelievable opportunity for me. Let me just press. Are you getting the support you think you want to get from the white house and from the congress for your agenda then . Indeed. Yes. Lots of friends on the hill. And the president and the white house has been very, very supportive. I mean, look. We recognize that there is latent potential in so many of our young people today. And were doing them a disservice by not insuring that they all have an equal opportunity to get a great education. Lets go to questions from the audience. Questions. Right here. Tell us who you are. Im a believer in the cause. You have to say to yourself, i think, that inner city Public School education is maybe the biggest shame, i think, in this country. And yet you look at michelle, she would say she was more successful, but its a suicide mission. I think, matt, thats what youre saying. How can this country really fix education in the poorest parts of our country, where without education, i dont think there is progress . Thanks for the question. And i would just challenge all of you. You have you all have spheres of influence. You have opportunity to get engaged in your own communities. You have opportunities to engage in your states, to advocate for policies that will actually change the Playing Field for all families. Especially for those families that dont have the means that we have to be able to choose for our kids. Unless we fundamentally change that, i think everything not everything that we have done, but much of what we have done to try to change and reform education over the last several decades has been merely moving the game pieces around on the game board. And it is not a winning strategy. We have an opportunity to fundamentally change the course for kids today and tomorrow by giving everyone the same kind of opportunity that weve had for our kids. Other questions . Questions for secretary devos. No . Before i turn it back to matt. Here we go. Right here. Hi. Keith almond, ceo up in michigan. How would you describe your strategy or your key initiatives for the department to drive that change you talk about . So three main areas that im focused on within the department. And they all the first one is certainly k12 education. Starting with insuring that we implement the every Student Succeeds act as congress has intended. Thats a big piece of work. And secondarily, to advance policy that will help complement what states are doing to empower parents with more choices. Elieve that its really the states role to take on these policies and to do them in a way that works for their states. Theres lots of different mechanisms, but they have to really respond to and take the initiative within the states. And the federal government can come alongside and complement what theyre doing. The second area is with Higher Education. And as we have already talked about, the fact that we have many students that graduate high school, dont know what they want to pursue. Some of them go to school for a year and a half or two, and then drop out because they havent really found a direction or a passion for their future. We have to give students a much wider menu of opportunities, starting in high school and in middle school, to help guide them into a productive future. And i think, you know, you all, we all can be part of that. Then the third area of focus is really the department itself. And you know, the president has given us all, all the agencies, a directive to do a topdown review, not only of the operations and structure of every agency, which we are doing, and which we think we can streamline and simplify to a large extent, but also all of the regulations that have been part of that agency. And just the week before last, we indicated a rollback according to mackenzie report, by 2064, we will have negative employment growth. At that time, we can only compete globally if we are more productive. In other words, we have to really become very, very good in our emerging technologies areas and educating our school pipelines, the students in the emerging technology areas, all of the advanced computing, artificial intelligence, your advanced materials. So what are the government and the Current Administration doing, particularly the u. S. Doing in preparing us for such a future . Good question. That sounds very daunting, doesnt it . I go back to what i said earlier, that i think the most important skills to help a child learn are Critical Thinking skills, the ability to collaborate, the ability to communicate well, and the ability to be creative. And i would stress that fourth one, creativity, because i think for many students, they have they have felt the process of education, of going through school, is one that sort of sucks the creativity right out of you. And thats why im an advocate for many different models and many different approaches to be taken to offer students ways to learn. One of the most promising developments in k12 curricula is what i would refer to as personalized learning, which is really focused around a students ability to demonstrate competency or mastery of a subject matter, material, whatever. And when doing so, be able to move on to the next segment. Not measuring by the amount of time the child is sitting in a seat but letting them move on as quickly as they are able to, and really fostering that interest in learning as a result. Another promising approach is the inquirybased project approach. And we have seen pockets of this being adopted in schools around the country. But its not by and large. Theres lots of skepticism, lots of speculation about what might not work. I would say we need to liembraa lot of this a lot more. And a lot more schools need to be looking seriously at how they keep kids engaged in their own learning because that is going to ultimately help foster creativity. And ultimately foster those who are actually going to create jobs, create new opportunities for others. Secretary devos, matt murray, thank you very much. [ applause ] so the administration has a very ambitious economic plan, 3 Economic Growth. We have seen that a few times, a fee quarters over the last few years, but their intent is to get it up there, keep it up there, and perhaps grow from there. So what are the forces, the trends that could help or hinder that very ambitious Economic Growth target . John is a Global Economics editor of the wall street journal is going to speak with Kevin Hassett, the chairman of the white House Counsel of economic advisers. Please welcome them. [ applause ] thank you all very much. I actually want to start off this interview with you, by asking the audience a question. So the economy has grown at a 3 annual rate for the last six months. Im hoping, please put up your hand if you think the economy is going to sustain that pace of growth of 3 for the months ahead. About half. I would give it closer to a third, but well say a third to a half. The administration is looking for 3 growth. So theres some skeptics in the audience. Explain to the audience why were going to get that growth rate sustained. Sure, well, first, youre right that we have had a couple quarters in a row of 3 growth, but the first one of those was something of a weather related phenomenon, that there was a weak First Quarter because of the weather. But Fourth Quarter is looking like its going to be about in the same range. So were going into next year with a significant amount of momentum. If you look down into the nuts and bolts of the numbers, the thing that really jumps out at me is that its probably represented in this room, that Capital Formation has started to pick up this year. That Business Capital spending was really, really bad over the last few years. One of the measures we look at is something called capital deepening, and its sort of how much workers have better machines to work with and how much their productivity is going up because they have better machines. Capital deepening going back to the second world war, contributed almost a percent a year, but in the last few years, it went negative. There was more depreciation than there was investment in the economy as a whole, which suggested a pessimism. But right now, the business pessimism seems to have waned and Capital Spending is back up. I think that has to do with optimism with the tax reform and something to do with the president s regulatory agenda. Business investment is going to drive. Please raise your hand if youre planning to pick up your own pace of investment in the next year. The same people. Another third to a half. At least 70 y would say. The lights are bright. The Federal Reserve projects longterm growth around 1. 8 . We were talking about a 3 growth rate. What do you see that the fed isnt seeing right now in terms of the economys long run prospects . First y have an enormous amount of respect for the independence of the fed. As a former fed economist, i can say theyre an elite bunch. But i think that, you know, if were talking whats growth going to be like ten years from now, then whatever we do now will have be less impactful on growth because it will change the level but not necessarily the growth rate. In the long run, there are underlying factors like population growth that are determinant of gdp growth. In the near term, we have a Business Tax Reform plan that i think it looks like its highly likely to pass. It seems like everybody who is counting votes seems to be optimistic. And its going to repair a badly broken Corporate Tax system. You know, the oecd, probably a decade ago, told us that we needed to have a corporate reform in the u. S. Because were chasing all the capital offshore, and if we fix that, then well get a surge in Capital Spending in the u. S. , which should drive gdp growth up in the short term. Right now, i dont know what the feds assumptions are about whether the tax reform passes, but i would guess if you reduce the user cost to capital by about 15 , which is our estimate of what it does, then that 15 reduction cost of capital should increase gdp growth. Are you saying that 3 growth is possible for the short run but not so much for the longer run . The 1. 8 number i said might actually be given it depends how far you go out. There are a lot of things that can be a stimulative for growth more than just a year out. Like attempts to increase labor force participation, the idea that being close to full employment, becoming an attractive place for capital to locate again should mean theres going to be a lot new factories going in the u. S. , that should lead to more labor force participation. It could genorth of 1. 8 , but the retirement of the baby boomers is a really big deal. It used to be that Labor Force Growth would give us maybe about a percent more Economic Growth in the background for the potential gdp than we could expect seven or eight years from now, so for sure, at some point, then the positive effect of the things would affect the level but not the growth rate. I want to talk about the level of unemployment, now 4. 1 . This is a level that economists sometimes describe as at or even below full employment. The idea being that if it goes much lower, the economy risks potentially overheating, creating inflation or wages growing faster than are sustainable or even potentially a new bubble. Would you say where we are right now is a level consistent or even below full employment. When i started at the fed, they had a natural rate of unemployment estimate that was about 6 . Then i remember, this was a long time ago that i worked there, that they reduced it to about 5. 5 in the five years i was working there. I think we found that Unemployment Rates below that can be consistent still with stable prices. I think the opportunity right now is if you look at the history of business cycles, its precisely now when labor markets are tight in places where you start to see income inequality decline and wage growth increase. If we were to take that sort of magic moment where things are teed up to reconnect people to the labor force, give them a wage hike, improve income inequality, and then we at that moment reform our tax codes so that lots of factories want to locate in the u. S. , then it could really be transformative for our economy. The way to think about it is one of the things the has received a lot of attention is the fact that theres a lot of geographic inequality in the u. S. Distressed areas with high Unemployment Rates. And then areas, colorado, they have about half a worker for every job opening. If you look at surveys, they say the biggest problem is they cant find workers. If we become a territorial system with a 20 rate, people are going to want to locate their factories in places where theres workers. I think its a historic opportunity to bring the jobs home. I want to come back to the geographic issues that you just raised. But just to stay on this point, so were in a position where theres real opportunity, but we have also seen in periods in the past where we had unemployment at or near 4 or even lower. We have seen financial bubbles. In the late 1990s, we got a stock market boom that wasnt susta sustainable, and then again in the mid2000s. Is there a risk if unemployment keeps falling, well get a financial excess and given the way that you see stocks behaving right now, is that a signal that the economy or markets are potentially overheating . I think theres definitely always that risk, and the one thing we have learned is that as soon as we think that the risks are low, thats when the risks start to head upwards. But going back to whether its sustainable or not in a relationship between the low Unemployment Rate and their sort of forecast for the future, think about it this way. If the Unemployment Rate is 7 and youre a firm and want to increase your output, you could get a cheap worker off the unemployment line, but if the Unemployment Rate is what it is now, and youre like the Colorado Company that has listings but there arent a lot of people applying, what you have to do is invest in increasing the productivity of the people you have. And that productivity increase will transfer into wage increases. The data suggests that true. So that happens. If that happens, we get the productivity enhancing Capital Formation, then we can expect this to be a sustainable higher level of growth that would affirm the expectations of markets. I dont think its possible that the sort of productivity enhancement we need to stay at 3 is something that anyone reasonable would project if we dont pass the tax reform. Therefore, i think this whole thing about the market, the market might already be ahead of itself if the tax reform doesnt pass. When you say might even be ahead of itself, explain what you mean. Sure, well, for the market is like an expectations mechanism for the future. It looks at all the Different Things that might happen and puts probabilities on them and says on average this is what we think is going to happen. If you think about why prices are where they are right now, it must be because the market has factorled in some probability that this tax reform, which would be quite good for the u. S. Economy, will pass. If we learn it wont, that will be bad news for the marketer exactly how bad depends on what the probability is built in. Thats something i dont know. Do you think its fully priced in . No, i dont. I could guess we could actually ask right here, you know, the people again like how many people here think the odds are greater than 70 that the tax bill passes . Yeah, almost nobody. So maybe, but how about greater than 50 . Or around 50 . So thats about thats about as many people who think were going to get 3 growth. Yeah. So i want to talk to you a little bit about what happens when theres another recession. This expansion is now more than eight years old. We have never had an expansion go longer than ten years. Whats the governments role, and by that i mean in fiscal policy and also in Interest Rates, Federal Reserve monetary policy, when we go into another recession, which if history is any guide, could happen some time in the next three or four years. First, i dont think that the evidence is too convincing that recoveries die of old age. Very often, theres an event, a precipitating event that causes the recovery to end and recession to begin. Theres an economist at the university of california san diego, jim hamilton is his name, who has looked at postwar recessions and found for example, that very many of them if not almost all of them, start with an oil shock. That is pretty much unpredictable. So recessions are going to come into our future, for sure, but i dont think that the odds of recession in the next year are unusually high just because were eight years in. What is this administrations tool kit and what tool kit do you see in the central bank . I again respect the independence of the fed, but the fed has a big tool kit its used in the past, and if it continues, if the recovery continues and it normalized monetary policy, the more theyll have an ample tool kit to draw on. The literature has suggested that the fed is more nimble in recessions and that attempts to use stimulus has often been too late, and there was the old fact that the committee very often has announced were in recession after the recession is over because the data are backward looking. If you wait for them to say youre in a recession to have a stimulus, then its not clear that youre going to be timely. But absolutely, if a recession were to happen, then fiscal policy would probably be part of the mix. And thats something that even now, cea, were studying and starting to think about options because you dont wait for the rainy day to buy an umbrella. What are the options . Particularly, we have very low inflation right now, its possible that Interest Rates arent going to go much higher in an environment like that, what other fiscal options that this administration would look at if we hit another downturn . One of things we learned, for example, something we have studied a lot since the summer, is the shovel ready project idea is not necessarily a good one. Infrastructure investment is a really great investment for our economy. Its something the president has talked a lot about since the campaign, but youre not necessarily going to get Infrastructure Spending out in the next six months to stimulate the economy, but other things such as tax variables have a quicker response. Youre pulling that lever now with tax variables with the major overhaul. Which is hopefully an insurance policy about what were talking about. If we become the most attractive place on earth to locate, then theres going to be a big increase in Capital Formation in the u. S. , which would be some timely insurance this deep into the recovery. I want to talk to you a little bit about fed policy. You signed a letter to ben bernanke in 2010 calling on the fed to stop its bond buying programs. Whats known in markets as qe or quantitative easing. The fed didnt stop. It kept doing it. Who was right, who was wrong . In terms of whether that was an Effective Program or an inEffective Program . You or ben bernanke . I wrote the letter in the past before i am in the white house where its really important that i respect the independence of the fed, and if the fed looked back at that history and decided that they needed to act in a similar way, then i certainly wouldnt want to be engaged in the public debate with them on that. I think at the time, that a few of us thought that Forward Guidance could probably accomplish a lot of the things that they were trying to acco accomplish with qe and thats what prompted us to write the letter. Certainly, the idea that inflation risks were lifted and significant, which was something that some of us believed at the time was incorrect, so the fed thought at the time they could do this and that it wouldnt create even potentially much of a medium term risk of higher inflation, and that certainly occurred. We had growth and we didnt have a big uptick in inflation. We have a question from the audience, a real question were going to ask them to use their machines to answer about globalization. So we want to very the view of the audience on globalization. Has globalization been good for business . Let me see, hard for me to see here. I can see. Okay, right down here. So its a pretty unanimous view that globalization has been good for business. Almost everybody. 95 . Whats your view on whether globalization has been good for American Workers . So i guess i already get to ask the audience, right, that its right there in front. I cant phone a friend. But no, i think globalization, of course, has been good for american business. Trade makes everybody better off in the end. This administrations view is that we have entered into a lot of really bad trade deals that have made americans worse off. How does that fit into your view . I think the president s view, he has spoken about this a lot, i have spoken with him and the other members of the team aunch about trade, is that trade deals could be a lot better. Theyre not always symmetric, but i dont think theres massive opposition to the idea that trade improves welfare in an economic model. We have a followup question which ill put up there real fast. Are you worried about the trump administrations commitment to globalization . Lets see if the answers vary at all there. It looks like were coming in a little bit more than 60 are saying that theyre worried about this administrations commitment to globalization. What do you have to say to address these concerns in the audience . I think that President Trumps view on trade is something that has been shared by president s of the past, if you look at the person who ran the ustr for other president , they very often were out there trying to improve trade deals to end asymmetries, to reduce nontariff barriers. They didnt have a lot of success. And President Trump thinks the trade deals could be made better. And i dont think that anyone can argue with that. The question is, can we accomplish that through negotiations. Is it also your view lets go to questions, if theres questions in the audience. We dont want to cut off your time with Kevin Hassett. Questions for kevin . If not, ill give it back. Yes, right over here. How often and how frequently do you interact with the president , and how have you found him to be as a student of empirical macroeconomics, Data Analysis in a way that he hasnt consumed before . You know, the interaction with the president , how often, is something that well keep between ourselves, but i have met with him often. And i really enjoy spending time in the oval office, that he dives deeply into issues. Has good intuition, is willing to challenge his own intuition. I have had a very positive experience. If i hadnt, i would dodge the question, but for sure. Hes a great boss. Thats been my experience. So if you only had two tools to generate Economic Growth, the choice being one, tax reform, or two, Infrastructure Spending, which one do you think would have a greater impact if you could wave a magic wand as of today . I think that we would start with tax reform and thats been the judgment of this white house. That i think that we have been working very hard on infrastructure. I think that i have been to six principles meetings since my confirmation on infrastructure, where people are really digging in and thinking about how we can have a 21st century infrastructure that supports the thriving economy that will be produced by our tax reform, but i think that prioritizing tax reform is the recognize thing to do because again, were the highest Corporate Taxed company on earth. You could ask another question, but when i go around and talk to business leaders, i have a hard time meeting someone who has built a plant in the last five or six years because the other countries are so much more attractive around the world, so i think prioritizing that was the right thing to do. When will we see the administration move forward on an infrastructure agenda . Is that a 2018 item . Whats at the core of it, public slaes private partnerships . Its still a work in progress, and youll definitely see a lot more on that after tax reform, and after tax reform is the current view that we have, and hopefully thats sooner than 2018. Other questions for Kevin Hassett . Turn it back to john. I want to ask you about stagnation. We have Larry Summers coming on after you, and hes made the argument that this economy is not in a position to grow more robustly because of secular stagnation, a dearth of Business Investment and consumer demand. Whats your response to this idea that there is a fundamental headwind to growth that cant be overcome . Its certainly possible that its true, but an alternative hypothesis is that Economic Growth has been negatively affected in recent years by higher taxes, higher regulation, and so on. And the fact that our trading partners have been cutting their taxes so much. In fact, i was just in paris last week talking to president macrons advisers who were cutting their rate to 25 . Theyre already starting with a rate below ours. So i think that anyway. If everyone else is cutting rates, are we cutting rates just to keep up . In other words, are we going to get the kind of growth boost you expect when everyone else is moving in the same direction . I think that if we cut rates now and start to participate in the International Tax competition, then theres a chance that those things will produce growth. And the International Evidence is that it will. And so in that case, the secular stagnation case is going to be refuted by policy changes that are affected