Wednesday night’s Republican debate will probably be remembered for Rick Perry’s amnesic moment or Newt Gingrich’s promise to fire Ben Bernanke, but it was a sign of the times that the first questions to the candidates were on Italy, and what they’d do about it if they were President of the United States.
It was also a lesson in how to debate.
Here’s CNBC presenter Maria Bartiromo kicking things off:
And we begin with you, Mr. Cain. I want to begin with what we saw today, another rough day for our money, for our 401(k)s. Once again, we were all impacted by the news that the Dow Jones Industrial Average dropped 400 points today. The reason, Italy is on the brink of financial disaster.
It is the world’s seventh largest economy. As president, what will you do to make sure that their problems do not take down the U.S. Financial system? It is the world’s seventh largest economy.
As president, what will you do to make sure their problems do not take down the U.S. financial system?
And frontrunner Herman Cain’s response (our emphasis):
CAIN: Let’s start with two things. First, we must grow this economy. We have the biggest economy in the world. And as long as we are stagnant in terms of growth in GDP, we impact the rest of the world. We must do that.
But we’re not going to be able to do that until we put some fuel in the engine that drives economic growth, which is the business sector. This administration has done nothing but put stuff in the caboose, and it’s not moving this economy. We must grow this economy, number one.
Number two, we must assure that our currency is sound. Just like a dollar must be dollar when we wake up in the morning, just like 60 minutes is in an hour, a dollar must be a dollar. If we are growing this economy the way it has the ability to do and at the same time we are cutting spending seriously, we will have things moving in the right direction in order to be able to survive these kind of ripple effects.
Contrast laggard Jon Huntsman’s response a few minutes later:
So we wake up this morning, and we find that the yield curve with respect to Italy is up, and prices are down. So if you want a window into what this country is going to look like in the future if we don’t get on top of our debt, you are seeing it playing out in Europe right now.
You are seeing the metastasy (ph) effect of the banking sector. And what does it mean here? What am I most concerned about, Jim? I’m concerned that it impacts us in way that moves into our banking sector where we have got a huge problem called “too big to fail” in this country.
We have six banks in this country that combined have assets worth 66 percent of our nation’s GDP, $9.4 trillion. These institutions get hit. They have an implied bailout by the taxpayers in this country, and that means that we are setting ourselves up for disaster again.
Jim [Cramer], as long as we have banks that are “too big to fail” in this country, we are going to catch the contagion and it’s going to hurt us. We have got to get back to a day and age where we have properly sized banks and financial institutions.