>> ERIC: WELCOME BACK.

TONIGHT, WE'LL TALK ABOUT THE SHUTTERING OF THE HOUSING STABILIZATION SERVICES PROGRAM AMID FRAUD ALLEGATIONS, WELCOME TWO BROADCAST LEGENDS ABOUT TO HIT THE STAGE AT THE CHANHASSEN DINNER THEATRES.

AND OUR POLITICAL PANEL IS STANDING BY.

>> Cathy: SURE IT.

BUT WE START TONIGHT WITH ECONOMIC NEWS.

IMPORT TAXES FOR PRODUCTS COMING INTO THE U.S. ARE NOW HIGHER THAN THEY HAVE BEEN IN A CENTURY.

LAST FRIDAY, PRESIDENT TRUMP FIRED THE HEAD OF THE BUREAU OF LABOR STATISTICS FOLLOWING A SLOW JOBS REPORT.

THAT’S WHY WE’VE INVITED LOUIS JOHNSTON TO JOIN US TONIGHT.

HE’S A PROFESSOR OF ECONOMICS AT THE COLLEGE OF SAINT BENEDICT AND SAINT JOHN’S UNIVERSITY.

ALWAYS GOOD TO SEE YA.

>> BRINGIN' THE GOOD NEWS.

>> Cathy: THE MARKETS WERE UP TODAY ON WHAT NEWS?

>> THEY WERE.

WELL, JUST ON THE FACT THAT THE TARIFFS HAVE GONE UP AND IT HASN'T CAUSED A COLLAPSE IMMEDIATELY.

SO IT'S LIKE, OKAY, WE GOT ANOTHER DAY.

>> Cathy: THE TAR IFF, EVIDENTLY THE REVENUE FROM THE TARIFFS, $50 BILLION A MONTH.

>> IT'S A LOT.

WHEN YOU RAISE TAXES FROM AN AVERAGE OF .5% TO ALMOST 20% ON GOODS COMING IN, YOU'RE GOING TO RAISE A LOT OF MONEY.

NOBODY EVER ARGUED OF THAT, IT'S WHAT THE EFFECT OF THAT GOING TO BE?

>> Eric: NOW, DOES THE SUPREME COURT GET A PIECE OF THIS ON THE PRESIDENT'S ABILITY TO DO THIS?

>> YES.

SO THE SUPREME COURT'S GOING TO RULE ON WHETHER THIS EMERGENCY DECLARATION THAT THE PRESIDENT HAS USED TO IMPOSE THESE TARIFFS ACTUALLY COVERS THE SITUATION THAT HE SAYS IT DOES.

SO, SINCE THE '30s, THE PRESIDENT HAS HAD THIS EMERGENCY -- THIS EMERGENCY POWER, THEY RARELY INVOKED IT, NOW HE'S GIVING IT A TRY.

>> Cathy: HOW SUCCESSFUL HAS TRUMP BEEN IN GETTING THESE CONCESSIONS?

THESE TRADE CONCESSIONS.

>> WELL, T'S EALLY HARD TO SAY.

THERE'S THAT OLD JOKE ABOUT HOW WHEN YOU STOP HITTING YOUR HEAD AGAINST THE WALL, IT FEELS GOOD BECAUSE YOU STOPPED.

I MEAN, WE STARTED THIS WHOLE THING WITH VIRTUALLY NO TARIFFS.

AND, SO, NOW THESE DEALS WE'VE COME UP WITH ARE HAVING INCREASED TARIFFS NOT ONLY ON GOODS COMING INTO OUR COUNTRY, BUT ON OUR PEOPLE SENDING GOODS ABROAD.

SO IT'S MAKING IT MORE DIFFICULT, NOT ONLY FOR PEOPLE TO TRADE WITH OTHER COUNTRIES TO BUY THEIR STUFF, UT TO SEND OUR PRODUCTS, OUR FARM PRODUCTS, OUR MANUFACTURED GOODS, THINGS LIKE THAT.

THAT'S GETTING GUMMED UP.

>> Eric: YOU'RE A PROFESSIONAL ECONOMIST, WHO WORKS WITH DATA.

>> YES.

>> Eric: AND I WONDER IF YOU FEEL THERE'S SOME MONKEY BUSINESS WITH THE LABOR STATISTICS.

>> ABSOLUTELY NOT.

I WAS SO DISTURBED WHEN THEY FIRED THE COMMISSIONER OF LABOR STATISTICS LAST WEEK.

THERE'S NO WAY HAT THERE'S ANY KIND OF RIGGING OR ANYTHING GOING ON.

THEIR METHODOLOGY IS CLEAR TO EVERYBODY, EVERYTHING THEY DO IS TRANSPARENT TO THE ENTIRE ECONOMICS AND STATISTICAL COMMUNITY, THEY'VE BEEN USING THESE METHODS IN ONE FORM OR ANOTHER BACK TO THE 1940s.

>> Cathy: BUT THERE ARE REVISIONS, THOUGH?

>> THERE ARE REVISIONS, BUT THAT'S BECAUSE AT HEART THIS IS A SURVEY.

THERE'S ONLY A FEW THOUSAND PEOPLE THAT ARE SURVEYED EVERY MONTH, AND AS NEW INFORMATION COMES IN, WE CAN ADD TO THAT TO GET A BETTER, CLEARER PICTURE.

>> Cathy: AND THOSE REVISIONS COULD NOT BE MANIPULATED?

>> NO, NO WAY.

>> Cathy: I'M WONDERING, THEN, ABOUT THE RIPPLES OF THE FIRING OF THE HEAD OF HE BUREAU OF LABOR STATS?

>> WELL, I THINK WHAT IT DOES, IT ADDS TO THE UNCERTAINTY THAT WE'VE BEEN DEALING WITH EVER SINCE JANUARY 20th, WHICH IS, WHAT ARE THE TARIFFS GOING TO BE?

WHAT'S GOING TO HAPPEN WITH OUR STATISTICAL GATHERING?

SAME THING WITH POTENTIALLY FIRING THE CHAIR OF THE FEDERAL RESERVE.

IS HE?

ISN'T HE?

IS HE GOING TO RESIGN?

IS PRESIDENT TRUMP GOING TO FIRE HIM?

WE JUST DON'T KNOW SO IT'S CONTRIBUTING TO THE BUSINESSES FREEZING UP AND SAYING, ALL RIGHT, WE JUST NEED TO BE CAREFUL, WE'RE JUST GOING TO HOLD ON ONE RIGHT NOW.

>> Eric: THE PRESIDENT OF THE MINNEAPOLIS FED ARE SAYING, TWO INTEREST CUTS ARE STILL POSSIBLE THIS YEAR.

WHAT WOULD THE IMPACT OF THAT BE?

>> NOT MUCH, BECAUSE UNLESS THEY DID SOMETHING REALLY UNEXPECTED, THEY'RE GOING TO BE A QUARTER OF A POINT, THAT'S HARDLY ANYTHING.

SO MAYBE INTEREST RATES MIGHT BE A HALF A PERCENTAGE LOWER THAN THEY ARE NOW BY THE END OF THE YEAR.

>> Cathy: CAN I GET BACK TO THE JOBS REPORT FOR JUST A SECOND HERE?

>> SURE.

>> Cathy: MANUFACTURING DOESN'T SEEM GREAT.

>> NO.

>> Cathy: NOW THAT SHOULDER OF CONCERN, ESPECIALLY, I WOULD THINK, TO THE PRESIDENT.

>> WELL, IT'S A REAL CONCERN BECAUSE ONE OF THE THINGS WE DON'T TALK WITH IMPORTS, A LOT OF THE THINGS THAT MANUFACTURERS USE TO GOODS IN THE U.S. ARE IMPORTED.

SO, YOU IMPORT SMALL PARTS, YOU IMPORT SPECIALIZED MOTORS, YOU IMPORT RAW MATERIALS.

AND THEN YOU BUILD THINGS IN THE UNITED STATES.

WELL, THOSE THINGS ARE GETTING MORE EXPENSIVE, SO MANUFACTURERS IN THE UNITED STATES, THEY'RE SLOWING DOWN THEIR PRODUCTION, THEY'RE SLOWING DOWN THEIR HIRING.

>> Eric: WE HAD FARM FEST DOWN IN MORGAN THIS WEEK.

>> UM-HUM.

>> Eric: WHAT'S THE REPORT FROM THE FARM?

>> WELL, THE REPORT SEEMS TO BE THAT IF YOU'RE GROWING SOYBEANS, YOU'RE GOING TO LOSE MONEY, NO MATTER HOW MUCH YOU PRODUCE, BECAUSE THE PRICE IS LESS THAN PRODUCTION COSTS.

OTHER CROPS ARE NEAR THE MARGIN, BUT IT'S REALLY TOUGH TIMES.

THERE'S AN ARTICLE IN THE "STAR TRIBUNE" THAT I JUST CAUGHT ABOUT HOW THE NUMBER OF PEOPLE LOOKING FOR FORBEARANCE FROM FORECLOSURE HAS GONE WAY UP JUST IN THE LAST COUPLE OF MONTHS.

>> Cathy: DO YOU REMEMBER WHAT THAT WAS LIKE IN THE '80s?

>> I DO.

I TELL THAT STORY IN MY ECONOMIC HISTORY CLASS AND IN MY INTRO CLASS.

I'M VERY CONCERNED ABOUT THAT BECAUSE IN CENTRAL MINNESOTA WHERE I LIVE, THAT WAS A DEFINING EVENT.

AND IT COULD BE AGAIN.

>> Eric: IS THERE A FARM BILL IN OUR FUTURE?

>> RIGHT NOW THERE ISN'T, NOT IN CONGRESS.

>> Eric: OKAY.

>> Cathy: ALL RIGHT.

>> Eric: THAT'S WHERE IT WOULD COME FROM YOU.

>> YEAH, THEY'RE NOT DOING IT.

>> Cathy: WHAT ELSE ARE YOU GOING TO BE WATCHING IN THE NEXT MONTH?

>> ONE THING I'M GOING TO KEEP A CLOSE EYE ON, PRESIDENT TRUMP JUST APPOINTED A NEW FEDERAL RESERVE GOVERNOR, WHICH WASN'T EXPECTED, SOMEONE RESIGNED, NOW HE PUT IS CHAIR OF THE ECONOMIC ADVISORS TEMPORARILY IN THAT SEAT.

IS THAT GOING TO MAKE ANY DIFFERENCE AS TO HOW THE FED OPERATES?

IS HE GOING TO OPERATE AS SOMEBODY WHO IS KEEPING AN EYE ON WHAT'S GOING ON OR BE ANOTHER DISSENTING VOICE AT THE TABLE.

I'M GOING TO KEEP AN EYE ON THAT.

AND THEN I ALSO JUST WANT TO SEE WHAT'S GOING TO HAPPEN TO INFLATION IN THE NEXT COUPLE OF MONTHS.

IS IT GOING TO START CREEPING UP AS THOSE TARIFFS COME IN TO BITE US.

>> Eric: ALWAYS GREAT STUFF.

THAN