like a scolding that your mother or preschool teeteacher would g the economy, you don't know how to share, and you are right. but it turns out that it was good advice when your mom said it and appears to be good advice now. looking at the pyramid here of the reagan and the clinton years and both bush years, the times were mostly good, but they were really mostly good for the rich. the top one percent saw the income rise by 280%. the rest of the country, not so much in the way of more money. now, people still had jobs though, and we were taking out a lot of credit so that the living standards were going up, so we didn't think about it all that often, but this is where the things began going wrong, and where we could begin seeing that we knew how to make a few people very rich, we weren't learning how to make the middle-class richer, but we ignored it and figured it would go away, and inequality usually does in recessions, but we just had a pretty bad recession and how is it doing? getting worse right now. the second graph will help show you why the july job number bes broken out by education and the unemployment rate for people with college education are more with 4.3% which is amazing number and great economy and for workers without a high school degree, it is 15% which is basically a depression, and for workers more in the middle if you have a high school degree and maybe a bit of college it is 9% or 8%. i didn't know how to take that, but a week ago i interviewed a nobel prize economist michael spence who is a critical thi thinker, and spends half of his time in italy and he spends his time not talking about economy, but he studies the global economy and he just wrote a book about the global economy. when we spoke, he made a point i had not heard before and he said what we are doing in america compared to what other countries are doing in the recessions is that we are quote trying to keep our lifestyles going and the way we are doing is that to put all of the burden and the pain of the recession on the unemployed and leaving the employed untouched. a counter example here is somewhere like germany where the government is paying businesses not the fire people, and so that the way they are handling the recession that everybody is seeing the hours cut back a little which means a lot of people get paid less, but not cut back on jobs in which a few people get paid at all, and they are sharing the burden and sharing the pain across the workforce and we are not. but, you know, this has been going on for a while in our economy. if you pick up a copy of this month's "atlantic" magazine, you will see an article called "can the middle-class be saved" and it is by donald peck and it is one of the most important pieces you can read on the economy. if you go to our facebook page, we will have a link there so you can read it yourself. the important point of peck says that the crisis we are in shows the brutal underlying truth of the economy we have been in all along and the truth of uncovered by the refinancing of the homes and the low apr credit cards and the tech bubble and a truth that we can no longer run away from. we don't know how to share the prosperity or the pain and we leave the unemployed to fend for themselves and the rich to amass as much money as they can which turns out to be a lot of money and hope it is all going to work out, but it is not. it is not working out at all. without a healthy middle-class everything else will fall apart, too, and businesses will fall apart, because no one is buying the product, and deficits explode because people are not making enough to pay the income taxes, and more on that later, and the housing market crashes because you can't pay the mortgages. that is the genius of what your mom told you about sharing. not because it is good thing to do, but if you don't share and everybody else does not either, everybody will end up worse off. >> and joining me now is donald peck the author of the book "pinched" and don, thank you for being here. >> pleasure, ezra. >> one thing i didn't get into the introduction here but which squa scared me frankly is how you go to the economic pain tearing away at the social fabric and how more marriages are ending, and more children born out of wedlock marriages. can you tell me more about that? >> yes, ezra. one thing is that it has affected the genders in different way. it is the manufacturing and men are thrown out of work in this period, and when people struggle generally and especially when men struggle and economically insecure and out of work, they don't marry. and men and women do have children, but they don't marry when they are economically insecure. and what happens as a result is that children they have often struggle when as is usually the case their parents don't stay together. so, when you have families marked by economic insecurity, and when you have communities marked by economic insecurity, you see the character of those families and those communities changing, and you know, if unemployment is high enough for long enough in those sorts of places, the problem can actually become intergenerational which is what we saw in the 1970s in inner cities, and manufacturing suddenly left the inner cities in the 1970s and black men disproportionately fell out of work and trouble finding work again and that began a cycle of familial disappointment and familial disillusionment, and social problems that has existed since en. >> and so to push on this a minute, this can get into the situation where the recession of the fathers ends up on the sons. and you go into this article that the recession will end and then be back to normal, but been in pain for a while, but what people found is that when there is a recession that even the kids of the folks who lost their jobs in that recession, they will have lower earnings in their lifetimes, too? >> that is exactly right. we are underestimating the damage of staying in the period, because we assume that recessions are temporary, but deep long job recessions have permanent consequences, and permanent consequences on the unemploy and if they are unemployed long enough have a hard time to get back into work and consequences of children as well and children of struggling children will not do as well as a result of the period. >> and when did this begin? when you talk about the loss of the middle-class, it is going much beyond the housing bubble, and when sort of do you date this change in the capacity to bring folks who weren't that highly skilled or educated into the economically-secure lifestyle and when did that deteriorate? >> in the 1970s when we moved past the pure industrial economy for one thing, and that is when technology really began to take a bite out of jobs available to people with a high school degree, but not a college degree, and that is also when we began to unwind a more progressive system of taxation and redistribution. and i think that all of those, tho factors in conjunction have hurt the nonprofessional middle-class and high school dropouts. >> this gets to a point that you make in the piece which is that in our sort of post-war boom, and when the middle-class was healthier, you had the rich paying marginal tax rates of 50%, and we had a pretty healthy economy in this period? >> yes, we did. and as we have oriented the economy in a way that is likely to maximize the income of the most highly educated and the most skilled, and the most able, we have also reduced the burden on them, and we have asked kind of a less and less of them, and you hear people like warren buffett saying, that this is crazy, you know, we shouldn't be doing this, and that is right. i think that there is a tendency sometimes to de demonize the ri these periods, but we should celebrate their great accomplishms, but however in a country that is arguably losing the middle-class where millions and millions of people are really struggling right now, i think that it is fair and appropriate to ask the rich to bear a higher burden as they did in the golden era of the economy. >> and don peck, the book is called "pinched" and you should read it in the terrific article and you should read it. >> thank you, ezra. we have laid out the problem and it is dire, but it is time for solutions. stick around. [ male announcer ] this is coach parker... whose non-stop day starts with back pain... and a choice. take advil now and maybe up to four in a day. or choose aleve and two pills for a day free of pain. way to go, coach. ♪ [ announcer ]o, coach. who could resist the call... of america's number-one puppy food brand? with dha and essential nutrients also found in mother's milk. purina puppy chow. or will soon, you're starting a whole new journey. and, like many people, you're probably wondering, where do i go from here? consider an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company. call now for a free information kit and guide to medicare to get started. basically, medicare only covers about 80% of your part b medical expenses. the rest is up to you. a medicare supplement insurance plan helps cover some of those expenses. and that can save you up to thousands of dollars a year in out-of-pocket costs. plus, you can keep any doctor who accepts medicare patients. together with medicare, an aarp medicare supplement insurance plan could be the kind of coverage you're looking for. in fact, it could make a world of difference. call now for your free medicare guide and information kit about aarp medicare supplement insurance plans, insured by unitedhealthcare insurance company. welcome back. hopefully the beginning the of the show convinced you that the economy we had before the crash was not good enough, and yet, you never know it by listening to the politicians most of whom are stuck in either the '80s if they are republican or the '90s if they are a democrat. >> in his eight years in office, he helped swing open the doors of opportunity and prosperity to millions of americans. >> i love what ronald reagan said, and i have to read this to make sure i get the quote quite right and he said that governments don't reduce deficits by raising taxes on people. government reduced deficits by controlling spending and stimulating newwell. >> we balanced the budget 12 years that row and george bush inherited a $12.6 trillion surplus and not debt and deficit and 22 million jobs having been created before he took office. >> we need to get back to the reagan model n. this case by implementing the policies of growth. this budget begins by lowering taxes. >> we are not going to get back to the reagan model. we are not going the figure out how to go back to the 1980s or the 1990s, because we don't live in the 1980s or the 1990ss and those economies were based on those moments and worlds and worlds that are not as globalized as today and not outsourced jobs or automated or computerized and china and india were not competing for our jobs and worlds where unions were stronger, and worlds where jobs were more plentiful for those without education, and we are not going backwards, so we have to figure out how to go forwards. and a couple of men who thought a lot about it is the found over the build a dream.com, and the author of the book "darwin economy" which 'm loi i'm looki forward to reading. robert, let me begin with you here, and let me start broad. what comes next when you think of where the american growth will come from in the growing decades, where are you looking? what sectors? >> well, you know, i think that we won't see any real growth until we get demand back into the economy. we are suffering right now from a severe shortage ofwell, and businesses are not spending, and consumers are not spending, and the only people left on the scene to make a power in the decision is government. as it turns out, there are a huge list of items that need to be done with bridges crumbling, and sewage system ises failing and water systems subpar and the workers who know how to do the jobs are sitting idle, and the machines we need to do the work are idle, too, and the world wants to lend us money at low interest rates and get the economy back on its feet is job one. and then we can worry about where the jobs will evolve from there. >> let me push you on this, because i agree with you, but say we did all of the infrastructure and the demand and where would it come from because as i tried to wla outla the first segment that we had a consumption bubble, so what do we do to replace a demand from housing bubbles and things that are actually sustainable? >> well, it is a great question and as one pundit said in the housing bubble, what the american economy does is to borrow money in the chinese and build houses that are too big for us. we can't obviously keep doing that, and the long-run source of competitive advantage has been ideas, and that is what we are good at. the only way an economy succeeds in the global scene is to be relatively good at something, and we are still relatively good at that. there are people all around the world clamoring to get into the institutions of higher learning, but the share of patents worldwide that's been going to americans has been steadily declining and we are cutting the inh research budgets, and inf, and it is time to invigorate the competitive advantage and we can't cut those budgets to hope to remain competitive. >> well, that goes to your group's agenda called rebuild the dream. when i read that i thought, well, i don't know if we with can rebuild the dream, but we need to discover what the next one is, so what is your vision of that? >> well, first of all, i think that we need to be very clear that the last economy, the one that crashed had three problems wit. it was based on consumption rather than production and based on credit rather than thrift and smart savings like our grandparents and based on ecological construction rather than restoration. it will be more productive and conservation oriented and big components of green chunks of the economy where you are talking about energy, et cetera, and the problem is where we are now which is in the ditch to on the road of prosperity again, we have to have america's government to be a partner to the american people, and uf unfortunately washington, d.c. is trying to add more pain to the pain, by having the government go missing in action. in the country, traditionally those who have done well in america have been willing to do well by america in a crisis, and there is the first crisis we have ever had where some people think it is more important for rich people to keep hording and grabbing the money and let the middle-class go under the bus. we have to stop demonizing taxes. we have set up in the country a beautiful system in which the entrepreneurs can do well in the tax dollars and great roads and literal workforce and courts that work and social stability which is paid for by taxes so that the businesses can do well. and when they do well, they are supposed to pay america back in the form of good wages and fair taxes. if they break that deal, which is what is happening, and keep all of the gato gains, they are boyfriend in the world, gimme, gimme, gimme and don't give back. >> and ben, what is interesting is that you brought up campaign finance reform and it is not about jobs and green energy, but it is how the government works to make the decisions which struck me as sort of a smart thing to include there, because the process by which we sol problems seems toe ma s to me t some reform and fixing before we solve them. do you want to say anything about that? >> yes, i do. thanks for raising that. rebuild the dream.com which is an effort to fight for the middle-class and save the american dream, and we have to reinvent it, but we have to be willing to defend it. what we did is to ask americans and normal people, do you have any ideas for saving the economy that does not involve destroying medicare and social security, and we got 26,000 ideas and the one that came up almost inevitably though was you have to strengthen american democracy. we can't keep pretending that the corporations are real people and give them more rights than ordinary folks do and let them get everywhere. every good organization in d.c. has the been choked up by this swarm of corporate lobbyists who do not represent the best in america, but the worst in corporations. once we deal with that, we can rescue the political system and also our economy. >> and ben jones and robert frank, thank you very much. >> thank you. coming up, we are going to simplify, simplify and simplify and maybe henry david thoreau said it right, and boy, health care is ripe for some of that wisdom. opens its doors or creates another laptop bag or hires another employee, it's not just good for business -- it's good for the entire community. at bank of america, we know the impact that local businesses have on communities, so we're helping them with advice from local business experts and extending $18 billion in credit last year. that's how we're helping set opportunity in motion. crisp, clear, untouched. that's why there's brita, to make the water we drink, taste a little more, perfect. reduce lead and other impurities with the advanced filtration system of brita. ♪ ♪ [ male announcer ] unlike some car companies, nissan is running at 100% which means the most innovative cars, are also the most available cars. nissan, innovation for today. innovation for all. an accident doesn't have to slow you down. with better car replacement, available only from liberty mutual insurance, if your car's totaled, we give you the money to buy a car that's one model-year newer... with 15,000 fewer miles on it. there's no other auto insurance product like it. better car replacement, available only from liberty mutual. it's a better policy that gets you a better car. call... or visit one of our local offices today, and we'll provide the coverage you need at the right price. liberty mutual auto insurance -- responsibility. what's your policy? he needs some gellin'. yeahhhhhhh. gellin' is like having a teeny tiny foot masseuse in your shoe. you like ? nice ! dr. scholl's massaging gel insoles. outrageous comfort, all-day long. one of the weirder political success stories of the last couple of years is a respectable harvard professor who focuses on bankruptcy law and looks like a peanuts' character and hero on the left and i'm talking about elizabeth warren who has formed a exploratory committee to run for senate, and according to paul krugman, has the most financial foundation to run of any public figure in a long time. it is not that she was calling for consumer protection before it was cool, but she understood what consumers needed to be protected from, the complexity, the complexity that lawyers hide from people who need to know about them, and the complexity that a bank gives you everything that you need to know about the credit card and the mortgage and yet you can't understand any of it and you are taken by surprise when your rates are tripled a year later. >> so, in 198 1980, a specific example the bank of america credit card agreement was over 7,000 words and now their contract is 30 pages by the time you add up all of the inserts and 30 pages of dense unreadable legalese. >> warren had a great idea of how the handle it. you force the firms to offer plain vanilla documentation that people could understand and imagine that. but banks and credit card companies and other learneds weren't so enamored with her solution and fought that idea and largely won and they were able to stop her from getting the nod as head of the consumer protection agency she helped to found, but quietly in another part of the government, there is another successful attack on the complexity that most of us buy and few of us understand, health care insurance. a little noticeable provision mandated that insurancers who want to sell have to issue a nutrition label for the product. very few agencies agree on the label and how lit look,it will so instead of this, consumers will get this. elizabeth warren would be proud. you know what is easier to read? tweets from the show. follow us oun twitter @twitter.comlive, and you can find me at twitter.com/ezra klein and i'm also editor at the washington post, and death and taxes are sure things, but not so much if you are a republican running for president. stick around. [ man ] they said i couldn't win a fight. but i did. they said i couldn't fight above my weight class. but i did. they said i couldn't get elected to congress. but i did. now i'm trying to make it in music. ♪ sometimes when we touch ha ha! millions of hits! [ male announcer ] the new hp touchpad starting at $399.99. ♪ try this. bayer aspirin? it's not a heart attack. new bayer advanced aspirin's for pain. it has microparticles and enters the bloodstream faster. works twice as fast as before. did you invent this or something? dr. eric first, from bayer. wow. [ male announcer ] new bayer advanced aspirin. welcome back. the show today has been about sharing. like your mother taught you, you need to share the burden and share in growth, and in the show, i will admit it, i have at times criticized the republican party for being too willing to say, you know, i know it is tough, but you are on your own, but there is one place that the republicans want to see the burden shared more widely and it is not a place that you would necessarily expect, it is the tax system. the republicans don't mean they want the rich to pay more, but rather lately they want poorer and seniors the pay more and want them to share in the burden of the federal income tax more fully, and here is rick perry. >> we are dismayed at the injustice that nearly half of all americans don't even pay any income tax. and you know, in the liberals out there are saying, that we need to pay more. >> and he is not the only one dismayed. here is john cornyn. >> according to the committee on joint taxation, 51%, and that is a majority of the american households paid no income tax in 2009, zero. zip. nada. >> i want to be very clear here the facts are correct. 46% of u.s. households are not expected to pay federal income tax this year, and that is according to a new tax report from the u.s. policy center, but have you ever wondered why? here is a hint. it is because they don't make enough money. nearly half of the folks who are not paying federal income taxes this year are not paying them, because they are retirees and not making income and so you would have to begin taxing the social security benefits and the government giving with one hand and taking it back the other, and the rest of them are poor, and they have a job that doesn't pay them much money or it is wiped out when they take the standard deduction or take a tax credit that helps them to boost up the income. and remember, income taxes are not the only taxes out there, and there are state taxes and gasoline taxes, and consumer taxes. so when you talk about the income taxes, you are purposefully leaving out the taxes that leave out the bulk of the tax bill paid for by the poor, and for what? what is the end game here? d the republicans want to raise taxes on the poor? they haven't said that. do they want to tax the retirees more aggressively? and i want to hear the next ten words 51% of americans don't pay taxes and so we should -- what? maybe i will hear them now. joining me is a editor fof tof nastional review magazine, and thanks for joining me, ramesh. so if 51% of americans are not paying taxes, and what are romney and the other republicans going to do about it? >> well, i have not heard much about folks who have the concern about what to do next, and in the republican primaries in 2009 steve longan ran on a platform of flattening taxes in new jersey which was raising taxes on people with low and middle incomes and the "wall street journal" supported him on that if i remember correctly, but of course, he was creamed by governor christie, and now governor christie, so we don't have a true test of raising taxes on poor people is a popular position, but i'm guessing that the answer is somehow no. >> i am going to guess you are right. but most people don't know that more americans are not paying income taxes, because we have made a decision to right a lot of the problems through the tax code. so instead of sending poor people a check, we give them a low income tax break, and it is a big fan of ronald reagan and arnold freedman and what is the big effect here? >> well, don't forget the child credit which wipes out a big tax liability. and there are concern from the republicans that the earned income tax credit may be susceptible to fraud, and work disincentives that people of certain incomes are discouraged from working because they would lose the credit, but what you have here is simpler than that, because you have two basic senses on the part of republicans to one, think that everybody should pay in, and not focusing on payroll taxes. and number two, they worry that if people don't pay taxes, or don't pay income taxes in particular, they all think that government is free, and they are all going to be supporting more big government spending which of course they don't want. and the trouble with that for a lot of -- well, a lot of problems with that, but one of the problems with that argument is that there is no evidence for it at all. >> right. >> and this is something i wanted to bring up with you is that i think that in theory, it is a plausible fear that if you don't get taxes from all, great, we will have a fair amount of more social spending, but the folks who end up voting are the people who are taxed and voting is more common as you go up the higher income scale, and not for the common lower down, and the people who are getting the benefits, so i don't know what the test that the republicans are applying to the theory actually is? >> and the other thing is that people who pay the payroll taxes think of themselves as payroll taxes and they don't think they are not taxpayers and they don't think that the government is free for them and most voters don't make a sharp distinction between the payroll taxes and income taxes in the first place, but because it is all money coming out of the check. >> and one thing that is striking and you don't always hear this, but you will hear it in the clip from rick perry that i played earlier and pretty much every politician in the america the we they are talking about when they speak is the middle-class, and perry said he was dismayed and the we he identified himself were the rich people that the democrats want to raise taxes on. i thought that was sort of politically a little bit odd, because usually you don't hear the politicians in general and completely accurate they are rich, but you don't hear them admitting that all that often. >> and it is sort of we, the taxpayers, and another thing that is odd about this is that the republicans historically have talked about mobility, and sometimes exaggerating how much mobil there is in the country and saying that the guy is rich and maybe he won't be in a couple of years or the guy is poor and maybe not in a couple of years and just because you are not paying taxes on this year's returns doesn't mean you will be in five years from now when you are older and hopefully making more money and so forth and it seem likes the basic republican view that you don't just take a snapshot of the economy at one moment when you think about the distribution of taxes, because it goes out of the window on this topic. >> and one thing that goes more forward-looking in the conversation that i keep wondering if we will see much in the way of ambitious actual tax reform from the republicans in the field. and tax reform is big in congress right now and people are talking about it a lot, but i get a sense that it is chilled because the republicans belief if there is tax reform, it is revenue-raising, and do you feel that is accurate to see more bold moves on that this the primary? >> well, nobody in the presidential field on the republican side had, has a specific plausible plan. herman cain has the national sales tax which isn't plausible or desirable. governor pawlenty had a pie in the sky tax plan and he is not in the race anymore, but there is pressure on them tom can co with their own tax reform plans, and are they going to do more of the five or six or seven percent growth or something to conceivably pass the congress in a few years. >> but in herman cain, if you don't get the tax rebate back in 30 minutes or less, it is free. thank you. >> you are welcome. and first, e wawe want to h former president president clinton who is a new vegan, and he is 65 today. mr. clinton is showing no signs of slowing down. he is a international philanthropist, and sax player and former president, and happy birthday and many more. ♪ i like dat ♪ ♪ i like dat, all right [ male announcer ] mio. a revolutionary water enhancer. add a little...or a lot. for a drink that's just the way you like it. make it yours. make it mio. for a drink that's just the way you like it. have i got a surprise for you! yeah, it's new [ barks beneful healthy fiesta. gotta love the protein for muscles-- whoo-hoo! and omega-rich nutrition for that shiny coat. ever think healthy could taste so good? [ woman announcing ] new beneful healthy fiesta. okay, so who ordered the cereal that can help lower cholesterol and who ordered the yummy cereal? yummy. that's yours. lower cholesterol. lower cholesterol. i'm yummy. lower cholesterol. i got that wrong didn't i? [ male announcer ] want great taste? honey nut cheerios. want whole grain oats that can help lower cholesterol? honey nut cheerios. it's a win win. good? [ crunching, sipping ] be happy. be healthy. can i try yours? welcome back. melissa ray burger is in the newsroom looking at the story tas are developing right now. >> hi, ezra. we are told that colonel khadafy is making plans to flee libya. he could leave in days according to one official. the possible exile comes days after optimism from the u.s. officials who expect him to give up soon. we shall see. ezra, back to you. >> thank you, milissa. and when we come back, from one milissa to another. we will talk about class warfare. and also, a group of motorcyclists riding from shanksville to the pentagon. [ male announcer ] members of the american postal workers union handle more than 165 billion letters and packages a year. that's about 34 million pounds of mail every day. ever wonder what this costs you as a taxpayer? millions? tens of millions? hundreds of millions? not a single cent. the united states postal service doesn't run on your tax dollars. it's funded solely by stamps and postage. brought to you by the men and women of the american postal workers union. ♪ i'm jane wells with the cnbc market wrap. here is a look at how the stocks are doing today. i don't know if you have heard this, but they are all down. triple digits for the dow down 139 and change and s&p down 14 points and nasdaq down 35 points. parents, prepare for sticker shock in the back to school shopping. retailers have an average of 10% higher costs to account for the consumer costs. and research in motion is about to launch a service that will be called bbm music and it could be out as soon as next week, and we will see if apple gets geared? all right. we are looking at the squeeze on the american clas,s of how they are getting squeezed while the rich get richer. and we are not the only ones. we look at florida governor marco rubio. >> it is the class warfare and the language from a leader of the third world country and not the united states. >> it is true, because the united states of america is not a third-world country by any other measure except for by income inequality where we rank worst than the ivory coast and worst than cameroon, and 64th, in your face uruguay and jamaica and yuganda. uganda? yeah, uganda. keep trying, rwanda. it. >> it is about time we got one over on uruguay. and joining me is melissa harris perry hosting the last word with lawrence o'donnell who will be back in the chair tonight at 8:00 p.m. and how are you? >> good. except i have been watching the show all hour and it is a little depressing. >> well, yeah, we didn't get optimistic news today. >> yeah. >> and let me ask you a more optimistic segment that when we talk about the deluge segment which is about the op-ed where warren buffett said maybe i can pay more in taxes, because i'm extremely rich. >> right. >> but i didn't get a sense that the class warfare is a media and to some degree political invention, and that warren buffett and fair amount of folk are not talking about the fight between the rich and the poor and little bit more in taxes and little bit different in spending and it is vastly overblown given what we are talking about. >> well a couple of things are going on that should not classify this as class warfare, because we ask about the tax paying units, the tpus are households and families, and when we talk about the super rich we are not just talking about individuals, but the corporate tax rates and the collectives and institutions who are not paying money into the system despite the fact that we, as a collective, bail them out or who aren't for example when they are brought into local tis in ord to create jobs they are give sewn many tax incentives they are not creating into the communities aie communities, and so rich against poor households is not the case. we have a strongb tax identity here in the united states, and what is american exceptionalism is that i don't want to tax the rich is that one day i might be the rich, right. so that sense of class fluidity is precisely the thing that we are beginning to lose. >> and it goes exactly to the point that the poor don't hate the rich and they would like to be the rich, and also, this gets underplayed, but you saw it in buffett's op-ed and a couple of times in the last year that the rich are not so unwilling to help the poor and often say, for me the difference of 35% and 39% of the marginal tax rate of above of what i am making is not that big of a deal and yet we talk about this type of the thing in the political system like these are apocalyptic changes and we are on the tipping point as mitt romney likes to say, of being a capitalistic economy anymore. >> well, i come from a working class family, and i thought that in every single household, every single worker paid into the social security system, and those they take out of the taxes and everybody knows that, but the first year of my adult life, i was in my 30s when i earned enough money that in october i had finished paying into it, and then in november and december i had the biggest paycheck, look, i have a ph.d. at this point and i it had not occurred to me that what that meant is that persons just on, who only paid part of the year, and i thought, could we make the system solved by doing to keep withholding all 12 months regardless of what you earned and most people would di treasury, would be enormous. >> you can. raise exactly as much money. solvent, according to the congressional budget office, which i know because i'm a budget nerd. speaking of the budget and the economy, we talked on the show today about how we have had more trouble in recent years sorting out the economy by education. less trouble. very, very difficult for folks with a high school education to move into the lower class. we haven't talked about the way this is played out by race. for african-americans, unemployment rate above 15%. hispanics, above 11%. whites, under 9%. what is going on? what's the accounting for differences between the communities? >> typically we see unemployment rates double of that of white unemployment. the most shocking thing, the evaporation of wealth. not just an income gap which had been narrowing. not closed. narp owing. the wealth gap growing and growing exponentially in the past few years. the debt ratio in terms of what is of value, evaporated for blacks and latino especially for asian-american families. in this knt i think we have kind of a national fundamental psychological problem where when something good happens to us we think we caused it. when something bad happens to us we think it was the circumstances. >> right. >> when something bad laps to someone else we think that they caused it. and so -- we do this and then think, like getting an a or b on a test. i literally think although we behave -- if you weren't smart enough to be born into a rich family you don't deserve a quality education. if you say it that way, no one thinks children choose to be born poor, but we are making policy that literally keeps children not smart enough to be born into wealthy households poor for their whole life. >> one of the things people forget about wealth is that is the money used to invest in a child, money to pay for education, can pay for a home some day to begin building equity of their own. one thing people miss about the tax code talking about how much people are or aren't pay we dramatically lowered the tax on inherited wealth in recent years. taken the out of state wealth from significant levels to almost nothing in the tax field. we still redistribute income but sort of said, hey, if you were born well, good on you. we're living that alone chcts absolutely. again, though we have amare tock crazy, work hard you should get to keep it. that's not where the wealth is being passed. we're intergenerationally benefiting those who have parents that work hard, what we didn't do, not recognizing, intergenerationally passing on the inact to gain wealth for those born poor. even anti-tea party. >> stuart didn't go into it, low are to socially be able to move from the bottom of the bracket to the top. scares me when i larhear that. catch melissa on the last word tonight. right back to talk why no one should talk about christine o'donnell. [ male announcer ] this is lisa, who tries to stay ahead of her class. morning starts with arthritis pain... that's two pills before the first bell. [ bell rings ] it's time for recess... and more pills. afternoon art starts and so does her knee pain, that's two more pills. almost done, but hang on... her doctor recommended aleve because it can relieve pain all day with just two pills. this is lisa... who switched to aleve and fewer pills for a day free of pain. and get the all day pain relief of aleve in liquid gels. is it the new forty, i don't know. i probably feel about thirty. how is it that we don't act our age? [ marcie ] you keep us young. [ kurt ] we were having too much fun we weren't thinking about a will at that time. we have responsibilities to the kids and ourselves. we're the vargos and we created our wills on legalzoom. finally. [ laughter ] [ shapiro ] we created legalzoom to help you take care of the ones you love. go to legalzoom.com today and complete your will in minutes. at legalzoom.com we put the law on your side. what if we designed an electric motorcycle? what if we turned trash into surfboards? whatever your what if is, the new sprint biz 360 has custom solutions to make it happen, including mobile payment processing, instant hot spots, and 4g devices like the motorola photon. so let's all keep asking the big what ifs. sprint business specialists can help you find the answers. sprint. america's favorite 4g network. trouble hearing on the phone? visit sprintrelay.com. it's time now to "clear the air." throughout this week sitting in for martin we've spent time on serious subject matter. jobs, monetary policy, recession, the race for the white house, the work of the president, the urgent need for congress to do some work of its own. i want to end the week a little differently. call it "news that doesn't matter." by which i mine christine o'donnell. you remember christine o'donnell, right? the candidate who dabbled in witchcraft and lost the senate race. lost by a lot. not a u.s. senator today. did not come anywhere close to winning, but although i think she got a ton of media attention, you might say she cast a spell over them and is back in the news now. why? because she walked out on an interview with piers morgan because he asked about same-sex marriage or something? but the question isn't why she walked out. it's why was she on with morgan in the first place? what is news worthy? about christine o'donnell? in a week markets tanking at a time of economic stress and pain, a come wars is she on television ask she did not win the election. she has no power. nothing to fascinate the media. who does have power? the guy who beat her. the guy who is actually a sitting united states senator right now pap guy whose name most don't know. chris coonce. maybe a good time to check in with him. what do you know? he's doing something. i actually have some of those right here. in late june, legislation to amend the family medical leave act of 1993 so folks can take timeoff to care for same-sex spouse and a parent or partner. a grandchild or grandparent, the law does not let you do any of that. seems important. in may he came forward with legislation to amend the higher education act of 1965 so soldiers wouldn't see interest mounting on student loans while on active duty. seems like a good idea. in april, he pushed for 8-25, research and development tax credit permanent. congress extends is every few years. huge uncertainty for businesses. that's what the senator is doing. maybe it's time instead of covering christine o'donnell to cover him. thank you for watching. i'm ezra klein. martin bashir, the rightful resident of this chair returns monday. we're excited to see him again. you can always follow me on twitter and "the washington post."com. matt miller and "washington post" writer is in for dylan ratigan today. matt, take it away. >> ezra, great and eloquent as always. we've got the late ef on the market turmoil and the turmoil in the middle east. more on our push to get money out of politics, plus the question you'valways wanted scientific answer to.