First let me discuss the moderators.  A successful format would make them inconsequential but unfortunately this debate was not a successful debate from the perspective of the concentration of attention.  I believe CNBC failed miserably.   Two primary moderators, John Harwood, Maria Bartiromo, asked questions and they periodically called in reinforcements.  Jim Cramer was totally obnoxious in the way he asked every question as though he could only talk at the highest level decibel and emotionally shout questions that required no such emphasis.  Even the friendliest question sounded like the response to an argument.  The other periodic visitors to ask questions included Steve Liesman, Rick Santelli and Sharon Epperson.  I admit to having heard of Rick Santelli prior to this debate but I had no idea who the other personalities were.   I didn’t find any of them particularly impressive.  

Too many questions were posed as an attempt to suggest a moral answer.   Would you allow this industry to fail?  Would you allow student loans to be pulled out from under young men and women?   Would you allow people to lose their homes?  This type of leading question is unfortunate in a serious debate.  No one wants to see someone lose their home or experience hard times as a result of a program ending but we have to look at this from a completely different perspective as we seek a the long term solution to the problems of this country.   The solution as with all solutions will involve pain and some will feel that pain more than others.   I have confidence from statements already made that even Ron Paul who accurately cites the lack of federal authority to do many of those things it currently does would transition programs out and try to cause the least pain for everyone. 

Other questions are best described as cheap shots.   Issues on their own will divide candidates where there is a disagreement.  There is no need for the moderator to try to create that controversy.  There is no need for the moderator to try to get one candidate to call another candidate a name or accuse the other candidate of “pandering” for votes.   There is no need for one candidate to be asked to judge another candidate.  I find this unprofessional from people I must depend upon to gain insight to the mind of each candidate.   

Rick Santorum

Santorum drew one of the short straws.  As usual, Santorum was asked fewer questions.  He did answer most questions well but Santorum has not yet caught on.   One might ask whether the reason Santorum isn’t doing any better might be because he is not being given the opportunity but one must recognize that he isn’t getting more opportunity because he isn’t doing well.  The only thing that will apparently make Santorum a candidate will be if he does well in Iowa.   The questions he did answer, he answered well.   Most significant perhaps was his response to the call for government to help N. Dakota ramp up their energy industry to help them access and retrieve the energy located below the ground.   Santorum said he would not involve government in this.  Let the market work.  

He also defended his position that manufacturing needs to be lured back to America by zero tax rates.   More significantly perhaps was that he pointed to his level of involvement in the legislative achievements that dealt with issues now being discussed.    He wrote the bill that provided for Health Savings Accounts.   He reformed Welfare.  He suggested block grants to states for Medicaid.   The list is impressive.   I don’t believe there is any doubt about it.  Santorum has spent many years on the right side of economic and fiscal issues. 

Michele Bachmann

I can’t help it.  Beat me up for making this “sexist statement” but I do not consider it a slight to Congresswoman Bachmann for me to say she really looked great tonight.   She was a definite rose among a lot of thorns on that stage.   Now that I have said that let me also say that Michele Bachmann also demonstrated herself to be a strong, intelligent and able woman equal to any of the men on that stage.  Can she not be that and be pleasantly attractive too?

Michele also drew a short straw and didn’t seem to get as many questions as did Romney, Cain, Perry and Gingrich.  She hit the nail on the head many times despite this.  Capital is fluid.  When the government over- regulates and over-taxes capital will move to other more friendly markets.   She emphasized the need to lower taxes, reduce the regulatory burden, repeal Obamacare and Dodd-Frank, and once again legalize American energy.   She also emphasized the need to control immigration.  

She accused Obama of going to “General Axelrod” for ideas of how to cure the economy when he should be going to the Job Creators of America.   She wants to make the tax code more fair and one of her means of doing this would be to return everyone to the tax rolls.  Every adult in this country has a responsibility to participate in financing this government.  I agree.   

Her comments on Fannie Mae and Freddie Mac were accurate and also to the point.  Fannie and Freddie have collectively asked for another $13 billion in bailout money from the treasury yet in this environment the company is paying $13 million in bonuses to its top executives.  How does one justify this from a GSE (Government Sponsored Enterprise)?   I agree with Congresswoman Bachmann.  This is not only ridiculous but in this economy it is an unconscionable slap in the face to every taxpayer.  This is as Michele described crony capitalism at its worst. 

In the area of healthcare Michele described how Obamacare made the cost of healthcare even more expensive.  Its goal was cost containment but from the beginning she knew as did many others among us, including myself, that Obamacare adds an artificial stimulus to the market and simply will not work.  Congresswoman Bachmann also called for Medical Malpractice reform.   She didn’t have time to go more deeply into this but this could come in the form of tort reform, especially a loser pays rule in the court system.  

When the conversation moved to China she talked of national security issues.   Apparently we allowed the Chinese to dump computer chips into our market that provide potential for hurting our weapons systems.    Why on earth would the DOD purchase equipment to be used in sensitive military assets from the Chinese?  Perhaps of greatest significance is that our interest costs will be enough to soon finance the Chinese Army.   I find this appalling and I emphatically agree with Mrs. Bachmann that we must stop the madness and stop borrowing from the Chinese.  We must retire this debt as soon as practically possible.   

Newt Gingrich

I really can’t say anything more about Newt than I have already said in prior columns.   He is the brightest light on that stage.  

His first sentence on question one about the economy was his call to fire Bernanke.  He called for an audit of the Federal Reserve and he asked to see the Decision Documents for 2009 and 2010.  We need to see who the Federal Reserve has bailed out, who they refused to bail out and why.   He pointed to the fact that the reason for the tax policies promoted by Republicans is to get industry working again recognizing this will create a greater likelihood of someone earning a paycheck and thus cause welfare to be left behind.

In Newt’s characteristic way he once again slammed the media.  At one point the moderator, Maria Bartiromo took umbrage.   He asked why it is that most of the media and certainly the Wall Street Occupiers do not try to understand history.  He asked the media to ask those Wall Street Occupiers the simple question, “Who will pay for this park if you cause these businesses to fail?”   He pointed to Henry Ford and Bill Gates.  Neither began as wealthy people but both developed ideas into huge employers and profit generators.  It is because of profits and the desire for more profits that jobs are created.  When the job has value a person will be hired.    He emphasized that a growing economy produces both profits and jobs, something that still seemed lost on Maria Bartiromo.  

Newt agreed with Romney regarding the need to allow the market to play itself out and eliminate the foreclosures.  Until this happens, the housing market will not be able to recover and the values of existing homes will not rise.  Newt called for the repeal of Dodd-Frank as did others this evening.   It kills small banks and small businesses.   Because of Dodd-Frank, banks profit more from foreclosures than they do from short sales.    In direct response to the questioner as to how to save the housing market, Newt said that when jobs come back, the housing market will come back.  

One moderator attempted to catch Newt in a Gotcha Moment.  He pointed out that Newt was paid a sum of money by Freddie and Fannie and he was asked what he did for that money.  Newt immediately responded that he was not a lobbyist. That he was hired as a historian.  He gave them advice and they did the opposite.   

When all the participants were asked to respond in thirty seconds as to what they would do upon repealing Obamacare, Newt told the moderator, it was Maria again, that the question itself was absurd.   She was asking that he provide a response in thirty seconds as to what he would do with 18% of the country’s GDP.   He pointed to his suggestion for Lincoln-Douglas style debates with Barack Obama.  He suggests seven of them.   As to the general answer Gingrich favors restoring the Doctor-Patient relationship.   Send Medicaid back to the states with block grants.   Focus on brain science and fix healthcare rather than fixing the bureaucracy.  

Gingrich provided some history on Social Security.   He pointed to 1968 when Lyndon Johnson put the Social Security Trust Fund into the General Fund.   It was an advantage in that it hid his huge deficits.  Now, more than forty years later it is no longer an advantage to have that Social Security Trust be a part of the General Fund.   He wants to separate it and deal with the trust as a separate issue.   The country should pay back what it has taken from this fund.  I might add, with interest!  

Everyone was asked what to do about the high student loan debt.   Gingrich told us this began as a $15 million program by Lyndon Johnson and the unintended consequences include the likelihood that students will stay in college longer.  Detachment from the immediate monetary obligation has allowed students to tolerate tuition increases they would not tolerate otherwise.  He emphasized that students need to go to class, study, graduate, and emerge from college debt free.  He spoke of a program that allows students to do this without incurring debt.  

On the issue as to why Governor Schwarzenegger of California contracted with a Chinese firm to build a bridge, Newt asked the $64,000 question.   What is it about American regulations that make it cheaper for the State of California to go to China to build a bridge than to build it here in the United States?   He favors raising the pain level when the Chinese steal technology but he also admitted that no one on that stage really has yet identified the best way to do this.  

Mitt Romney

One of the first questions of the evening went to Romney and it concerned the cause for a drop in the Stock Market today; Italy is in dire financial trouble.  Should the US help? What can it do to avoid this impacting the US?   Romney’s answer was to allow Europe to take care of its own problems.  We cannot support a TARP for Europe. 

While there in Michigan Romney pointed to the damage CAFÉ standards have done to the auto industry.  Those in Michigan should already know but Romney reminded them anyway that government gave GM to the UAW and gave Chrysler to FIAT.  What should have happened is that these companies should have proceeded normally through the bankruptcy process.  We have laws that deal with these issues that the Obama Administration chose to ignore.  

Romney was asked whether he would keep a CEO burdened by the charges against Herman Cain.  It was a cheap shot and totally inappropriate.  Romney demonstrated his poise by deflecting the question as not belonging to him.  

With regard to the conflict that the CNBC moderators tried to create between profits and jobs Romney tried to teach the moderators that profits allow businesses to grow and then hire people.  Obama doesn’t like business.  Romney wants to see business expand and be profitable. 

On China Romney said China is cheating.   They are stealing intellectual property.  They are manipulating their currency to hold down the price of their goods.   He would label them a currency manipulator and if necessary he would apply tariffs on goods they sell us.   Romney emphasized his love for free trade.  Predatory pricing is no good.   The strategy is to drive others out of business with the plan that at some later date when competitors are gone they will increase those prices.   Currencies should be allowed to float. 

Herman Cain

Herman Cain had a strong evening.   His first question was about character issues and sadly about the accusations that have surrounded this last week and wasted all our time.    Cain responded that the American people deserve better than someone being tried in the court of public opinion based on unfounded accusations.   Cain values his character and integrity.   This was a good, strong answer!

With regard to 9-9-9, Cain indicated this is more fair than the current structure.  As to how this would not become 19-19-19 he responded that tax codes do not raise taxes, politicians do.   People will hold their feet to the fire because all the taxes will be seen and no longer hidden within the prices of goods they purchase.  

With regard to Fannie Mae and Freddie Mac, Cain would privatize all GSEs.   He wants to unload these two organizations to allow the market to determine the future of the housing market.   Another good strong solution!

With regard to Obamacare and what Cain would do if the GOP was successful in its repeal, Cain pointed to HR3000 as already written.  It allows decisions to be with the doctors and the patients.  

On the question of whether the government should stop Boeing from opening its plant in South Carolina Cain emphatically said open the plant.  Government has no role in this controversy.  

One humorous note on overregulation was his reference to the need to repeal Dodd-Frank.  The other two things wrong with Dodd-Frank are Dodd and Frank.  

Rick Perry

Rick Perry failed again in this debate.  His largest gaff was his failure to remember the names of all three departments he would eliminate after telling us there were three.   We all have been caught in moments like this and as such I was embarrassed for him.  At the same time, Perry was on a stage debating other competitors for the GOP Nomination for President. 

Another of the foolish questions was asked of Perry.  Do you believe businesses can be profitable and still hire people?  This was probably the most ridiculous questions asked all evening.   Face it, this was a stupid question.   Perry’s response was, “Better be.”   I really don’t know what more he could have said to anyone who would ask that kind of question. 

In an attempt to have the horse push the cart Perry was asked whether a housing recovery wouldn’t create jobs.  Perry said, pull back the regulations, and get people into jobs and then the demand for housing will return.    

Perry had one of his more effective moments when he responded to a question via video from the CEO of Caterpillar.   There is a reason why Caterpillar moved two of its divisions to Texas.  It had nothing to do with their being Republicans or Democrats, job creators wanted an environment in which they would be able to keep more of what they create.   But then he stepped into a hole by saying his tax plan among all those presented by candidates on that stage was the only one that would work.  Then he told us he would eliminate three departments and couldn’t name all three.  He did later tell us the third he could not remember was the Department of Energy and he had previously named the Department of Education and the Department of Commerce.  

Perry emphasized, as all need to remember to do, that when discussing Social Security, no one currently dependent or soon to be dependent upon their entitlement would be affected.  Other candidates would do well to remind themselves to always remind seniors this is true.  

Ron Paul

Had I never heard Ron Paul before I would be a supporter because of this debate.  He shines on economic issues and the impact of government involvement in markets.   It isn’t that Paul wants to hurt people by allowing foreclosure to take their home.  It is simply that he recognizes that until the government gets out of the way the market cannot correct itself by weeding the bad loans from the banks’ portfolios.   The market must determine what this paper is worth, not the government. 

Paul said the disease is spending.   In year one he would cut $1 Trillion from five departments.  He would get rid of the price fixing done on interest rates by the Federal Reserve.  He pointed to M1 being up 30% and he warned of coming inflation.  Love him or hate him, Paul is right.  

In response to that question as to what he would do after he repealed Obamacare, Paul said he simply wanted government out of the healthcare business.   Republicans have this natural propensity to replace something they don’t want with a program that addresses the same issue but in a different way.  Wouldn’t it be nice if they would simply say, “Nothing, nothing at all?”  At the same time Paul said he would transition Medicaid away from government and not simply allow those dependent on it today to fall.   

Paul favors elimination of the Department of Education (as do I).   How would he make education more affordable?  Paul tried to teach the moderator something about economics.  The reason these costs are so high right now is that government is involved.  The current situation couldn’t do a better job of demonstrating the failure of current policy.  There is no authority in the Constitution for the federal government to loan people money.  Students would pay for education the same way they pay for cell phones or computers.  The price of college will decrease when government gets out.   

There was another example of cheap shots from the moderators when Paul was asked whether he believed Perry was guilty of crony capitalism as governor in Texas.  Paul deflected the question.  I would have liked it better had he simply told the moderator that the question was inappropriate.  

John Huntsman

Huntsman responded to a question regarding the structure of the economy and the belief some have that the rewards of capitalism are not shared more equally between the top one percent and the bottom ninety-nine percent.  His response was that he wanted to be president of the ninety-nine percent and the one percent.    He pointed to how Obama is working to divide the country and he wants to bring it together.   People are tired of seeing their money go toward bailouts.  

He demonstrated empathy in that candidates have lost sight of the fact that there are people who tuned into tonight’s debate who are upside down on their homes and will suffer as a result of any potential solution.   He favored a means of right-sizing Fannie Mae and Freddie Mac and removing the risk from the taxpayers and placing the risk back on the banks.  

Huntsman favors repeal of Obamacare as does everyone else.   He would like to address questions of cost containment with fifty governors and do a better job of harmonizing medical records and close the gap on the uninsured with affordable insurance.  

With regard to the flat tax Huntsman pointed out that everyone on the stage was a theoretician but he instituted a flat tax in Utah and this makes him a practitioner.  

In a last desperate gasp the moderator tried to get Huntsman to accuse Romney of pandering for votes.  I do not object when controversial issues cause candidates to expose differences in opinion but I do object to a moderator who would overtly try to create controversy on their own. 

All candidates get good grades for tonight’s debate.   If I were to pick winners I would say Gingrich, Romney, Paul and Cain get A’s but no candidate gets less than a B.  CNBC gets a D- for their part this evening.