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Gary Cohn on best ways to use stimulus money

Gary Cohn on how to help unemployment situation: use federal stimulus money to spend on infrastructure and give people new jobs in new industries.

Video Transcript

ADAM SHAPIRO: The next stimulus that we get-- there's going to be a stimulus, as you pointed out. What do you want to see because--

GARY COHN: Well, we hope there's going to be stimulus.

ADAM SHAPIRO: President Trump wants there to be stimulus. He said $2 trillion plus, whether Republicans in the Senate will go there. But what should it look like? We've got-- we're in New York City right now.

And you've talked about this. The restaurants-- 50% to 60% of restaurants here are going to go out of business. And that's not unique to New York. That's San Francisco, Chicago, major cities, small cities across the country. What do you want to see in the next stimulus?

GARY COHN: So the first thing I care about is jobs. And really, when you talk about jobs, you're talking about small businesses. As we know, unfortunately, the way the last economic shutdown worked is that the large businesses were all able to stay open. And they were deemed essential. And they were able to keep their employees.

And so when you're talking about jobs, you're talking about small businesses in America. You're talking about the restaurants. You're talking about the dry cleaners. You're talking about the hair salons. You're talking about the bakeries. You're talking about the delis. You're talking about all the businesses that you see on Main Street America all over.

So the first place I think we have to go is we have to go into the small businesses, and we have to go to job creation. It's some combination of PPP. It's some type of economic stimulus for small and medium-sized businesses, and for those that can't even stay in small, medium-sized business. We're going to have to help with unemployment benefits in this country.

ADAM SHAPIRO: When you talk about job creation, how do you put people to work in an industry that, for instance, restaurants are only allowed to have 25% capacity? Or even, we had on Ed Bastian from Delta Airlines. He's cut his workforce. He's had to, and it's a lot of early retirements, from 90,000 there down to 74,000. How do you do job creation in that kind of environment?

GARY COHN: So I think we all recognize that the travel leisure hospitality industries, entertainment industry, they're the industries that are really suffering. They're all based on travel. They're all based on densification. They're on people meeting, people being together. That is the toughest industry to come back. And I think it's going to be a long, slow slog to get back.

ADAM SHAPIRO: Should we give these people universal basic income? I mean if it's going to be that long a period?

GARY COHN: So it's going to be a long period to think about. What I think is we have to start thinking outside the box. We know we're going to need a long recovery period for this. So we've been talking about things like infrastructure in this company-- in this country for a long time.

Why don't we take a big chunk of this federal stimulus money and really turn it into something that we desperately need in this country? We not only need to modernize our existing infrastructure. We need to think about what a real, true infrastructure for the next century looks like.

ADAM SHAPIRO: How does that help, though? I hear what you're saying, but how does that help a waiter or somebody who's worked in those kinds of service industries?

GARY COHN: We're going to tape them, and we're going to give them new job opportunities in a new industry, in a new place where they can get a new job. And we're going to move people from the waiter industry, or from the restaurant industry, or from being a chef, or from being in a hair industry, into a new industry. We're going to move enough people out where there'll be less competition in those areas, where you'll start migrating people into different industries. So we'll move people into new opportunities.

So if you think of a country like the United States that still does not have a modernized air traffic control system-- we're still land-based air traffic control system, which seems a little bit out of date. We're one of the few major countries in the world that doesn't have a GPS-based system. I think we're one of the few major countries in the world that doesn't have high speed rail system. Why wouldn't we take some of this major fiscal stimulus and start building? Those are tens of millions of jobs, high paying jobs.

ADAM SHAPIRO: How much? Are you talking the $2 trillion-- they were talking about a trillion dollars when you were in Washington, and it never materialized.

GARY COHN: We were definitely talking about a trillion dollars. If you're talking about these big fiscal stimulus plans, instead of just giving people money, which I'm supportive of right now, why don't we give people money and employ them in something that's going to make the country more efficient and more competitive for the next century?

ADAM SHAPIRO: When you say give people money, are you saying universal basic income? Are you saying through [INAUDIBLE]

GARY COHN: I'm saying unemployment benefit. We've got to allow people to live, to get through this crisis. So what I'm saying is I acknowledge that right now, as the economies are shutting down, Congress slowing down, restaurants are going to be less busy since we're dining outside. And it's cold and wet in a large part of the country.

ADAM SHAPIRO: Retail stores as well.

GARY COHN: And a large part of the country is getting colder and colder and tough to eat outside. Restaurants are going to have to lay off people. Airlines are going to have to lay off people. Let's take the stimulus money, and let's spend it in a way where we can employ people. People get up and go to work in a way that's socially distanced, it's safe, but we can build a better infrastructure in this country.

ADAM SHAPIRO: Let me ask--