tv After Words with Don Watkins CSPAN May 14, 2016 10:00pm-11:01pm EDT
bookstores this coming week and watch for the authors in the near future on book tv. >> c-span, created by america's take cable television companies and brought to by a public service by your cable or satellite provider. >> next up on afterwards, i ran ran fellow don watkins discusses income inequality with diana roth of the manhattan institute. >> host: don, i have enjoyed reading your terrific book. on unequal is unfair, america's on got a and commit inequality. it is so thought-provoking provoking to say that inequality is not a problem. could you you start off by telling us why inequality is not a problem?
spee2 let's start off by what is economic inequality. i think it's usually equated with the rich getting richer and the poor getting poorer. inequality just means a gap. we can have a gap because some people are getting richer and others are getting poor and we can also get because people are getting richer at different rates. inequality can also rise or fall for different reasons. so one reason might be that some people are being really productive. you have a man and amazon employed thousands of people, creating tons tons of value by pioneering new invention. so he's going to get richer than me then say my wife was a teacher. she is i think a great teacher but she is only providing economic value to a few dozen people at a time. on the other hand, there are things that can increase inequality that are bad. that are unjust that take advantage of people. so bernie made off. he is going to steal money through fraud. so the reason i say inequality is not a problem as well were concerned is is not how much money you have but how did you
get it. did you get through something that was fair or through process that was unfair? when you try to equalize people who earn their money honestly that is something we are challenging in saying that is not fair way to treat people. >> host: we hear also that the middle-class is is stagnating and that inequality is one of the causes. what you say about that? would you say to these people? >> guest: i think you have to be clear that wise of the critics of inequality have made it such a central claim, this this idea of middle-class stagnation? i think it's because americans have a sense that we do not live in a zero-sum world. when you achieve something through your work it does not come at my expense. when they built dams and amazon it didn't make me worse off, it may be better off. so if you want to convey to people that we live in a zero-sum universe so to lift up we need to bring others down which is really what the inequality campaign is all about, in order to do that you have to be able to show
something to the effect that the guys at the top got there at your cost, by disadvantaging and taking advantage of you. that's really why this claim of stagnation has become central to them. the ideas that the middle class has stagnated, will use stagnated, will use different start dates for generally 1979. i think this is wildly implausible, just a common sense that if you ask someone would you rather be making 50,000 dollar today dollars today or hundred thousand in 1979? given the advances in medicine and everything that is happened in the internet and computer technology around, given our bigger houses, very few people would take that bet. the question is then, what then, what does this claim based on. what it is based on his claims that look at statistical aggregate.
so the idea that we are supposed to have in our minds is the idea of i started working in 1979 and i have not gotten a race for decades. but that's really not the scenario we are talking about. what were what were talking about is a certain statistical category has seen its wages not increase much overtime. statistical doesn't necessarily show what's happening to you and me. for instance to say that middle-class income have stagnated over four years, the composition of who is being counted can change. so we have different trends in immigration, we have seen an influx of immigrants primarily from poor countries. they come here to the united states and now they earn more than they did in their home country so they are better off. we are presumably unchanged. we are making whatever we were making before. yet what is going to happen with a median income when you have this influx of
people take low paying jobs, it is going to go down. even though everybody even though everybody is in the scenario better off. or you can take the fact that what the statistics look at his household income. but but the composition of households has changed over time. in the 1970s we saw a rise in divorce rates so if you are a couple making $50000 per year who gets divorced and even if they get a raise to say $35000 a year, statistically that makes us look worse off because no two households are making 35 instead of one making 50. so these factors lead to the statistics that claim that we are stagnating, but if we look around us and to really take a careful look at the statistics i don't think you can justify that claim. >> host: so unequal is equal is unfair is there any taxation at all to help people at the bottom? >> guest: i think the question we need to ask is what we need government for? we need government, there's no question about that and certainly not an anarchist. the reason we need a government is -- to think about go back
before the founding fathers. the basic set up by the government was unequal. for some people are born rulers and some people are born the rule than if you wanted to rise in life you had to get the favor of someone who is one of the rulers. >> host: but before the founding fathers life was brutish and short. we don't want to go back to those days do we. >> guest: my point is this. that is the ultimate rigged system when you have these entrenched, on equal, politically unequal groups. the real incitement of the indictment thinkers like the founders was each of us is equal and the fact that we have equal rights so the government's job is not to rule us, it is to be her servant, the protector of our rights. but what happens when it protects our rights equally? what happens when it protects your freedoms the way that protects my?
were going to create very different amounts of wealth because we have different abilities, we make different choices, some, some of us want to go and become a teacher and press that is what a successful life is, whether we go up from where parents work, or down where parents were, that's a successful life is. other people want to be had punch managers. other people want to start new companies. you are going to get inequality if we get equal freedom. >> host: right. yes. but what it out the people who want to start hedge funds cannot do that because they have a poor education? do you think the government has any role in making their opportunities more equal by making sure they have a better education? >> guest: no. absolutely not. i realize i skipped the skipped the important essence of your previous question which is does the government have a role to help out here. so let's let's start with the idea of equality of opportunity. i think it is been a mistake to talk about equality of opportunity. it can mean one of two things. one very good, one very bad.
on a level playing field that we all play by the same rules and that is what the political equality that i was talking about a moment ago means. it it means your freedom is protected equally to my freedom. the way that phrase has been used especially in the last 70 years or so is to mean equality of initial chance as a success. it means the fact that if you are born to parents who are a little richer or if they give you a good education or is one a gala terry and philosopher said that they did something some monstrous as to reach you, you are to have an unfair advantage. now it's true we have on equal opportunities and there's no way to change that. but one important fact needs to be kept in mind at all times. one persons opportunity does not come at anybody's expense. the fact. the fact is, take the example of bill gates. malcolm gladwell wrote a popular book a few years ago in which he pointed out that we give bill gates all this credit for succeeding, but he went to school, they they had computers when nobody else had computers. >> host: it was not just he went to school when nobody else had
computers, he got up in the middle of the night comes not come to college, programmed computers and then went back to bed and his mother was wondering why he was so hard to wake up in the morning. >> guest: that highlights two things. what we have been better off if nobody, it bill gates did not have access to those computers question now, we would be way worse off. everybody would've been a loser. the second point is precisely that, a lot of what matters in life is that the opportunities you have, but what you do with what you have. a lot of our success in life is really about turning things that do not look like things into opportunities that are opportunities. one quick example. we tell a story in the book, susan book, susan peterson had been a guest on the show shark tent tank which is a great show. she had a business making this stylish baby moccasins for kids to wear. she started with this but she
could start it into a business can she didn't have any money. did she complain about not having equal opportunity. no, what she did was ask her brother who had a window business if she could follow him around for the summer, keep the discarded window frames and so she is following him around, banging out the glass and at the end of the summer, he turned the aluminum in for $200 and that is how she started her business is how she started her business and now it is successful. if you had asked if she had any opportunities, just in the abstract, you would say oh no, she doesn't have any money. but because she set a goal for herself and she took the responsibility for achieving it, she was able to see something that was an opportunity, potential opportunity and then act to turn it into success. that's what you want to see. stop looking at others opportunities and start looking at was open to. but then just a highlight. no, i think the reason you can have the government promote one persons opportunities is the only way can do it is that other people's expense. what i'd like to see as the government stop taking away peoples opportunity
which i think it does way too much of. hopefully we'll get to talk more about these. if you just take things like the minimum wage which now in california where i live they're going to hike up to $15 per per hour for the next few years. occupation licensing laws, education system that leaves too many americans, particularly poor poor americans without a good education. these are really the the things holding people back. it's not that they haven't got a big enough handouts comments that they've gotten handicapped by government interventions. >> host: with increases of the minimum wage then skill people can't get a job set all and it's troubling that this is spreading it across the country. new york state might be the next. just in the name of getting rid of any quality. >> guest: so there's a debate in the literature about one side says the minimum wage creates unemployment, the other says no we look at the studies they don't. i think we can think about this in a simple way.
which way. which is this, if i cannot find somebody willing to offer me $15 per hour to work, that minimum wage it says illegal for me to work. and i come at this book in this issue from the perspective of philosophy. in particular one of the things philosophy is concerned with his justice. i would say even if it were true that 99% of the people at a higher wage and only 1% of the people get stopped from working by something like the minimum wage, that is unjust. you cannot prop up some people buy a blithering in the futures of other people who are unable to take that first step on the road to success. >> host: academic economists conclude that it is just a young and unskilled that are hurt by these increases in the minimum wage. it really is those who we are preventing from getting there put on the first rung at the career ladder. it is very troubling that in california and perhaps in new york, teenagers are not going to be able to get jobs.
>> guest: i think it is sad and tragic, it ignores the main thing that people need to succeed, this is really the story of american history, is an open road, and open road to success. go back before we had a welfare state, before the the government was doing anything to lift people up. here's a time when human beings only had economic progress for a short amount of time. yet, people were able to calm and build successful lives for themselves because here, opposed to their home countries, nobody was going to stop you for doing what you judged at best for your life. i think the same thing is true here. the more we open the road to productive achievement and stop putting blockades and barriers in the way of it, that is what really is going to allow everybody, regardless of where they start to have the maximum opportunity to achieve success and happiness. >> host: when used in your book quote that no one can exploit you with a voluntary trade,
there are charlatans who prey on the uninformed, look at buyers of the who thought they were by and let missions vehicle, do you think there's any role for the government such as the federal trade commission to make sure that what people are saying is true, or do you think there is any role for loss of her children say under some age, such as 15 or 12 should not be allowed to work to avoid exploitation? >> guest: the essence of a moral society when it comes right down to is voluntary. we interact voluntarily. we basically reach a mutual agreement or we are free to go separate ways. nobody can do something to us with our our consent. so the question is, in cases where someone sells you a product that is different than what they promised you, that is exactly when we need the government to step in and say that is not what that person consented to.
when he agreed to pay 20,000 dollars for that car is a car that was going to operate a certain way. i do not think you need by glittery precatory bodies, i think you just need laws against fraud, and so on. because what regulatory bodies do is basically, they they don't prescribe criminal behavior, they prescribed and proscribed productive behavior. they dictate how people produce and they decide what kind of deal and we arrive at. it is not regulation to tell carmakers when you sell somebody something it better be what it was. it is a regulation when they say your car has to get this kind a gas mileage and it has to have this many seatbelts and it has to do xyz. rather than leaving leaving that up to the mutual choice of buyers and sellers. as far as children the government has a responsibility to protect the rights of children, but i don't think that applies in so-called child labor laws which i think are on the whole, pretty damaging. on the one hand they're unnecessary when you are concerned with the
well-being of a child. parents, were so rich now that parents not going to send their kids into a coal mine. the first thing parents do when they achieve a certain level of economic success is sin their kids to school. that that is why you see child labor going away before there is ever laws against child labor. it was on its way out because of economic progress. those laws actually make it much harder for kids who are excited. instead of playing nintendo or or whatever the videogame system is, they would love to have a job where they can earn money, gain responsibility, you know you know who suffers most from those laws? the poor kids. one of my best friends were read about in the book, jeremiah, he was basically thrown into the foster care system at a young age. the main thing he did not have was his own money so he could actually be himself so that he could gain a foothold and start building a resume and achieving success.
this is one of the barriers. until you hit some arbitrary hd by the government you're allowed to out there and waste your life or hang out on the street corner or do any kind of unproductive thing that you want. the one thing that you cannot do is be productive. i think that's unfair to young people. >> host: don't you think there should be a loss in children, if they're under under certain age have to be in school. what if i know it's not very common but what if there were parents who would say look, i'm going to send the children out to wash cars all day because our family needs the money or something like that. shouldn't that be prohibited? >> guest: i think you have to have that government defined what we consider abusive children but after that it has to be up to the parents judgment. that brings you down a very dangerous road for a number of reasons. the basic one is now the government gets to decide what qualifies as an education. i things one that is one of the
worst things you can do. were worried about putting the government in charge of our healthcare decision which i agree. that's a scary thing. putting them in charge of the ideas, and the values that children are taught, we've taken that for granted over 100 years. i think the biggest risk is not a handful of parents once in their kids to school. i think the biggest risk is that schools are taken over by bureaucracy rather than opened up for choice, for parents being free to decide what ideas their children should be taught, for innovators to come in and find exciting, effective effective new ways to educate children. there's a government rob him with schooling today does not educate many children particularly those growing up in the poorest neighborhood. >> host: yes. one of the topics that is on radar is the presidential election. it has been really interesting to see how much support bernie sanders has with his talk of inequality. it is really driven his numbers. much higher than they would've been otherwise. can you talk about why that is? >> guest: this gives us to really what is going on in today's day.
is it that bernie sanders have tons of chrisman sex appeal or that he actually has some ideas that have some power. i think it is the power of the ideas. a comes from two things. number one, he is standing up for a moral ideal. this ideal of any equality. the second is that he has on his side of moral narrative. it tells us when you abide by my ideal you flourish and when you abandon the ideal you flounder. this you have no doubt heard that this is when america really reached its golden age in the postwar era. when the government supposedly fought income inequality and we all did better. what happened in the 70s which is usually equated with blaming reagan, starting in the 70s what
happened is we abandon that ideal. the 1% took over, started rigging the game, we moved, we moved in a radical free-market direction and the results is that they got all the games and we all stayed made. so the lesson is supposed to be fighting equality, things are are great, abandon inequality things are bad. >> host: so his message does have traction. it is been giving a lot of traction. he goes out there and he said texas should go up, 80-90%, people cheer and college students him, feel the burn. >> guest: i think when you have morality on your side, at least when you appear to have a moral ideal on your side that is very inspiring particularly to young people. >> host: they think that he is telling the truth and is coming from his heart. they see him as authentic area and had we fight that message or address it. >> guest: i think what's going on is he has this moral ideal,
take the ship reach college. he is going to help out people by giving them college. but also appeals to those on earn, could because the message kids take away is hey, maybe hey, maybe i will get out these college loans. when you combine for the unearned and moral ideal people crusade for something and the only way to pose that is to challenge the ideal. so long as you grant that free college that makes you a good person, then they can come out and take that strong stand for. if all they're doing this saying i want to bail out her hand out, you're not going to see that crusading spear. the thing that is happened and i think and i think what is really tragic about this discussion is that the critics of inequality, people who do not want to see the government expanding how much wealth it takes from people, expanding how much control it has over people's choices, people support free enterprise markets. they have not really had much to say on this issue. when we started writing her book. you know how many books the left put out on this issue?
probably 45 per year. how many of the inequality critics put outcome at that time, zero. zero. biggest issue already two years ago, since then there has been two books, one by a canadian professor not too many people have heard of unfortunately even though his book heard of unfortunately even though his book was quite good. and then another by thomas soul which had some good elements but it only addressed the small subcomponent of the debate. it cannot address the whole thing. when we do see the debate addressed and focuses on challenging the statistic and saying inequality is not as bad as you think or challenging the solution say we agree, we should minimize any quality, but if you remember rand paul during the presidential debate republicans will reduce inequality better than democrats. the trouble the trouble is, both of those concede that economic equality is an ideal. the problem is speaking of inequality is an ideal then we are in trouble because economic freedom is
immoral. we talk about this with - versus my life. i free-market leads to nothing resembling economic inequality. it. it leads to progress for everybody, that but very different progress. we have a lot of work to do. we have to challenge their ideal and narrative and we have to present a counter i deal and that is what we do in the book. >> host: yes. it certainly is a very much reading it i enjoyed it. it was a very much worth picking up and adding it. what seems to concern many americans is not inequality per se but mobility. we talk about people who start off low and they get they just want to get better off. that seems to be more important than economic inequality. what to say about that?
>> i definitely think that is true. a lot of our concern when it comes to fairness is not that gap. it is that our people are able to rise. are there able to rise by their own efforts even if they start out without a lot of wealth, without a lot of the things that people on the effluent side of the scale have. i think there are a few things that are important to keep in mind about mobility. first of all, mobility is not declined, most researchers agreed mobility in america has not really declined over the last few years. even as economic inequality has been rising. we have a mobility problem. the danger is thinking about mobility and in purely financial terms. you'll see these charts, how many people move up from the bottom quintile into the top quintile or until the middle. i think that is the wrong way to think about it because the goal in life is not to move up to a
particular q. week quintile. it's to find a krieger happy at, you can be self-supporting at, and build for yourself a fulfilling life. so, i mention my friend jeremiah. he started at the bottom and is now a teacher. i teacher. i don't know exactly how much money he makes but i imagine teachers probably don't make enough to get into the top 10% are top 20% of earners. but isn't that success. should we regret that he did not become an investment banker because he smart enough to because that would've gotten him to the top. people would say. >> host: people would say that we have to pay teachers more and that their level of giving back to society does not really square with the amount that we are paying. so his program from new york proposals where teachers teachers would get paid more in exchange for giving up tenure to teach. >> guest: that's funny. that is quite revealing. of the
union. no, i think teachers should be paid as much economic value as they can generate in the market. the problem is we don't have a market for education today so it is not clear what teachers should be paid in a sense of how much economic value are they really adding. the basic question is then, how should we think about mobility if we should not think about it by looking at these mobility tables. i think the way you think about it is, are there barriers for preventing a person from rising. are there barriers prevent stopping a person from rising. i think what it comes down to his government intervening in the economy in a way that prevents a person from rising by productive achievement. or productive merit. >> host: there are so many. for example occupational occupational -- >> guest: there's a million examples, maybe some that particularly annoying you but here's one that annoys me. but they can't find anyone to employ me and so i think i'm going to go out on my own and
teach or perform hair braiding because it is a skill i'm good at. let's say i know a bunch of people who want to pay me to do it. in many states i can't do that. it's illegal to do that to get a license from the state. >> host: you want me to braid your. i'm really good at that but as it. >> guest: as a trade i have to spend hundreds and sometimes thousands of dollars getting the license. where the people most likely to become hair brighter zen who are the people least likely to be able to afford a process like that? it is precisely the poorest people who need every ounce of freedom to really get that step on the road to success. that is just one of many examples. >> host: they were even closing down children's lemonade stands in some states. >> guest: absolutely. a lot of the lemonade stand is about teaching the lessons of entrepreneurship. i think that that teaches one of the mason lessons of entre entrepreneurship which means you
need permission to do on from the government to do almost anything. there's there so many barriers particularly for people starting out from the bottom. we talk about the minimum wage and education. here's one more area. everything. everything the government does that drives up cost of the things that we buy is a huge barrier in opportunity because it means i have to work that much harder just to make a living. when the government funds in affordable housing crusade a lot of what it is doing is driving up the cost of housing as more people are demanding housing. a lot of the restrictions we see by the epa on energy production, such as the whole ethanol scandal such as it is it drives up the cost of energy. who are most affected by that question what the people that do not have that big a budget and cannot afford higher energy cost. >> guest: the bottom 25% spend their money on energy, and oil on the top% spends 4%.
>> guest: and a fourth of a type edge it is a lot. there's a lot of ways in which it's becoming harder. if were really concerned about people being able to rise by merit the first obligation is to stop making it harder for them. >> host: what would you say to people who say we need to have more renewable energy, solar and wind even though it drives up the cost of energy because that helps the planet? do you you want to help the planet? >> guest: this is the big question but what i would say is i want to help human beings. i want to help human lives. the way that you do that fundamentally is leave people free to use the best energy for their lives. let them decide whether it is oil, natural gas or whatever. >> host: but then other people come and say this is polluting, this is increasing greenhouse gas emissions, this is causing global warming or climate change. what what would you say
to that? >> guest: how do we sum that up in a few sentences. i i would say this. if we actually look at the big picture pluses and minuses of the use of fossil fuels, it is, i think without a question, on net hugely beneficial to human beings. if we want to understand how human beings went from living from 30 until a.d. it is precisely because we have had to cheap affordable abundant energy. i don't don't think the argument we hear against fossil fuel actually hold up. >> ..
what fossil fuels do is give us the ability to cope with any clay -- climate. but the quality debate, one of the major things that we are told is that the -- we need to expand the power of government in order to equalize people economically and expand the power in order to prevent us from destroying the planet for fossil fuels. no matter what it is, it's always take away freedom and wealth from individuals and give more power to the government and these have become the two major arguments, the environmental argument and quality argument for expanding the government today. so we are tackling the inequality argument here. i should just add a close friend of mine wrote a book tackling the environmental one. so, you know, let's see, i would say we've got the problem solved.
>> host: we have to make sure people read and take seem. >> guest: that is the hard part. >> host: they say we should be more like scandanavia. >> guest: i worked with a colleague who is from sweden and one of the surprising things i found was that actually if you look at the history of say, sweden, what you find that it supports the complete opposite of the conclusion of what we are usually taught? >> host: why is that is -- why is that? >> guest: sweden versus america. we are often told that sweden is the socialist country and america is a capitalist country.
we are pretty much comparable in government economy, it's just different. much higher taxes, but actually much less damaging regulatory in many ways than america. so they're about comparable in that sense. sweden started off as one of the poorest countries in europe if you go back a few hundred years ago. one of the poorest countries in europe, it then quickly became one of the richest countries in europe is because it became one of the free market country. in many ways, it was more free market for many years than the united states. it became very rich, very unequal, very unequal. and i think roughly the 1960's you start to get sweden where it moved into the direction of
dramatically increasing taxes, dramatically increasing wealth distribution. it was a pretty -- it went very far in the direction of a social democratic redistribution state. the result was that the economy basically flatlined, things got really bad, you didn't see the economic growth, you didn't see the entrepreneurial verb, you weren't getting a ton of new companies. what happened, it shrank. well, eventually the sweden said this is not working and in more recent years started liberating economy and they've done really good economic outcomes, but what's happened income inequality start today -- started to grow again. you see a testament to the kind of case we are making. if you're concerned about economic progress, what you want
is not economic redistribution, what you want is economic liberation. >> host: we do need some things, for example, we need street lights, we need certain things that only the government can pay for and because of that we need to have taxes? >> guest: you need to differentiate between two things. we need to pay for the things that the government does that protect all of our freedom, particularly the military, the police, there's no question about that and, you know, you can debate about what are the best ways to raise the revenue. redistribution the government instead of raising founds protect everybody's freedom and property, thais bay takes some people property's property so that they can give it to other people and there's never a jfción for that. >> host: there shouldn't be any government social safety net no income tax credit, no food stamps, no unemployment insurance, no housing vouchers, no medicaid?
>> no forcing one person to work without pay so that other people can get paid without working. >> host: so if they get in trouble, they have the social safety net to fall back on? >> guest: no, i call that working without pay. if something wants to get paid for my services and i don't get to decide where that money goes to, i may not want it in that now, i'm not against the safety net if you want to call it that, bad things can happen in life and you have to be prepared for them. bad things can happen to the people you care for and you want to do something about it but all of that can be taken care of voluntarily. my previous book roosevelt care focused before and after the welfare state. one of the things that happened before america and really started in 1935 with the social
security act, was that there were challenges involved in industrialization, well, whraps if i lose a job, what do i do in retirement to take care of myself and take care of my family and what was happening is people were starting to find private voluntarily solutions to these. first of all, they would say much more significant amount of money than we do today but there was rising insurance in terms of unemployment insurance, although that was ovni -- ovni legal. private insurance. mutual aid societies where i could join health care benefits or in some cases a play to stay if i was elderly and i couldn't
support myself and, of course, there's abundant charity. why should we make a social safety net if want to call that voluntariy rather than coercive, different people have different values. >> host: probably worked for some people some of the time but we have all seen photographs of people standing in line for soup during great depression. are you saying life was better then and not having food stamps is an advantage? >> guest: wouldn't you be shocked if i said, yes, that was the ideal. >> host: i'm just interesting in your answer. when people are left free you
don't get wide spreed depressions. >> host: less regulation and the government should have -- federal reserve should have consistent monetary policy to say the rule without at the same time saying that they shouldn't be any social safety net. they don't have to go together. >> guest: the question is don't we need. history shows we don't need it and the great depression far from being an example, look what would have happened if we didn't have one, really it doesn't count as an example because the great depression is precisely the fact that we did have all of these government interventions in the economy and so if if you keep the government out of things, then private voluntarily charity is abundant and we are
so much richer now and this is way more less of a concern. i don't see it as a problem. what i see a problem as society that treats people not as individual that we owe respect for freedom and property to but who divide society into recourses and to burdens, burdens when we need handouts, resources exploited by society when we've achieved something. i don't think it's a way society treats people, it's the way as independent beings who have the right to be left alone to pursue their own happiness and success. >> host: if they fall down in the street of a heart attack, we don't have any obligation to help them get on their feet, we don't have any obligation to give them medical care, if they're starving we don't have obligation to give them food? >> guest: well, you're saying we, who is we?
>> host: society as a whole. >> guest: you have to ask which individuals have which responsibilities, if it's my friend or even somebody that i know around the neighborhood and i see like their house burned down, yeah, i have a certain obligation, it's part of having integrity, the people i care about when the chips are down i'm going to be down and assist them. >> host: say that someone who is very nasty like a republican and that person doesn't have any problem and no friend to bail them out, are you saying that there's no government entity that has a moral obligation to bail them out? >> guest: no, that's one reason why you shouldn't be a jerk. if you actually want people to help you and be nice to you, you actually have to be a trader, repay the favor. i'm against the idea that one person's need is a entitlement. when we think about the question, we often think about ourselves as the one doing the helping, yeah, i want to help people. i would hate somebody staffing
in front of my eyes, so would i. that's not an issue. you can free anybody in free society and historically people do. the question is this, let's say you're sick and need an operation and can't afford. would you think i'm entitled, i don't care if they're trying to build their business, i need something, you know what, i'm going to march over to my neighbor's house demand that he pay more my operation. i ask thousands of people that question, i have yet one person to say, yeah, that's how i would act, ask and understand if they said no, all right, i'll go ask somewhere else and that moral attitude should be reflected in policy. this isn't about helping people. this is about it's your need entitlement regardless of what you have gotten to that position and i never heard an argument for why it is an entitlement.
>> host: let's say you need to -- to take sake of argument, you need heart surgery and you go to your friend, would you give me the money for heart surgery, your friend might want to give you the money and not afford the magnitude, taking a few pennieses from everybody depending on their income so that when you needed your heart surgery there would be pennies from many, many people to help you with the heart surgery and there would be a fund, a risk pool so that you wouldn't have to depend on one friend. these are questions about the economy is at scale and where you might say the government has a role to play in enabling these things to happen as a safety net. >> guest: this is one of the reasons why insurance is such a
great innovation, we can get the economies of scale and we get them voluntarily. this is why it's so important because we can decide if it's worth it to us. now the problem today health care is a complex situation because it is so controlled by government that we take for granted the things would be as expensive as they are, insurance would be as expensive as it is. we have a whole section in the book where we talk about some of the ways where government intervention is really made health care in america a combination of really, really good that is we see a lot of innovation, progress and really bad, one of the way that's bad it has driven up price enormously precisely because it hasn't left the market free. >> host: that's true, we have severe problems in the delivery of health care just because of lack of competition and the lack of the ability to get bear bones health insurance. but it doesn't mean that it always works for everybody and i
would contend that we need some kind of safety net because we don't want a society where if someone doesn't have any friends there starving or dying of an early death and it's very troubling to me that you don't see the need. >> guest: the kind of scenario you're talking about is not really a realistic scenario that in a richland where people feel toward one another and there's somebody out there that's not going to have any friends, family, neighbors, no private charity willing to help them out, the idea that that is the really scenario we are talking about doesn't make a lot of sense. but i want to separate two things. i think it would be great if today we were debating should the government have any role in safety net. i think that's a good debate to have. i think that's very different from debating economic inequality. the economic inequality is what happens to one and a million
person or maybe less who can't help themselves and doesn't have anybody to voluntarily help them. what it says we need to equalize and the core of that is the idea that we need to bring down people at the top in and of itself. so it's not about solving problems with poor people. let me give you one example. capital in the 21st century, chief proposals for fighting inequality are marginal tax rates of upwards of 80%. global wealth tax of up to 10% and inherentance tax and says, this is not about raising money to help the poor because he argues high taxes never raise that much in revenue. this is about raising big fortunes. now i submit that that is have been different. it's a different kind of debate than what do we do about the
very exceptional case of a person who is in need and having trouble finding support that even if the person disagrees and says we need some kind of a safety net, they can see that there's something morally corrupt even though you by admission it's not going to help that poor person. >> host: right. just completely, very, very impractical because it's very difficult to calculate wealth, wealth changes every minute with markets changing and values changing so implementing a wealth tax is extraordinarily difficult which is why governments rely on income tax, but there has been a lot of animosity as you say towards some people and a lot of money such as ceo's and the government is trying to rain in ceo pay in some different areas. interestingly enough there's been a lot less towards rock stars such as madonna and lady
gaga and targeted at ceo's rather than artists and sports players who people think have earned the money that they get. can you comment on that? >> guest: yeah, part of the reason is it's very easy to see the value of what a lebron james does, like we can see, hey, he's a spectacular player and people love watching basketball. one of the really weird things about ceo pay we are taught to have very strong opinions about how much a ceo should get paid, but if you ask most people what does the ceo do, i have yet to get a decent answer from most people. >> host: they manage company. >> guest: people have no clue why that's important. obviously the people that we know who are experts and study this stuff they have some idea of it. but it's not well known and yet we are supposed to have a view of how much they should get paid.
the fortune 500 biggest countries -- biggest companies in america between two and $200 billion in revenue, you know what the average pay for the average ceo is 10 and a half million dollars. that's a lot of money. i'd be happy to take a percent of that, nevertheless, when you compare it to the scale of the companies that they're running or you compare to what lebron james makes, lebron james made something like 20-x million dollars last year as basketball salary. it does not seem particularly outrageous that ceos of these companies are making that amount of money particularly not when you look at how important their job is and how hard it is. everything around us, the tv cameras, air-conditioning, heating, the fact that we got here in a car, the fact that i got to this side of the country on an airplane, all of that was made by entrepreneurs, managers, by businesses and all those businesses were headed by ceo's
and as we have seen just in obvious case apple with and without steve jobs, it's clear ceo can make a huge difference there. >> host: yeah, that's true. it's because people understand basketball, they understand madonna, they just don't understand ceo, it's not you think they have animosity towards business? i was thinking they have animosity towards business. >> guest: it's both. it's the lack of knowledge. we are taught to be suspicious of business in general. if i was going to boil down to what our book is really about at the end of the day, it's a celebration of productive achievement and one of the biggest injustices in history is businessmen -- what's the most famous term associated with the businessmen of the 19th century, robber baron. the idea that they robbed people. what transformed this country from a country that was, you know, basically a swamp back
water, was totally poor into by 1914 the richest country in the world. it was in large part the actions of people like carnegie and people who really created these new industries, modes of organization and far from robbing people, if you look at the price of steel or the price of oil as rockefeller are getting richer, the cost of what their producing is going down, down, down as they supply a nation with later gasoline, and as they apply a nation with steel. and today in our own time we have seen a real smearing of any businessman who is successful, even steve jobs. within weeks of his death you started hearing people, but he didn't give a lot to charity. >> host: that's true. i read that. >> guest: this is a person who had created company and made
millions of thousands of peoples lives better and lift the standards of other companies who started thinking about the user experience at a better level and yet because he didn't give away the money that he earned he was vil anized. totally unfair. >> host: yes, yes. what message you want people to take from your book? >> guest: debate about inequality is debate about what's happened to the american dream and how do we revive it. one side has blamed it on the rich and seeing the solution as penalizing the rich. if you want to boil down our solution in a sentence, is that the way to move us in a better direction and revive the
american dream is to liberate productive ability and to celebrate productive achievement. >> host: yeah, yes. what are your main recommendations for doing so for expanding the economy, having more economic growth? what do you think presidential candidates should be saying right now in terms of how to get out of -- >> guest: oh, my goodness. first of all, let's end this corporate welfare. let businesses compete as a free market, no subsidies, no bailouts new york city special loans, let businesses have to prove themselves in an actual free enterprise situation. i would say also let -- let's stop putting barriers in the way of people rising particularly people starting at the bottom. let's get rid of the minimum wage so people are free to find ways. let's get rid of the insanely
occupationing licensing situation that we talked about. let's stop the government from making things so expensive through completely unnecessary and ineffective things such as the ethanol subsidies. let's make it easy as possible in terms of people start rising. i would like to liberating education, i think what's happened in nevada where parents are given more control and more choice with regard to education is a good sign. i would like to see more of that and innovators running to nevada so that we can really education become cheaper and more effective for all americans. and then finally -- >> host: did you see what happened in louisiana when the governor chip-changed, children
were not allowed to opt e schools anymore before allowed cd and f school and when the democratic said they couldn't drop out of c school. >> guest: it's concerned with everybody making about the same of their lives. so for instance, one of the things -- i take this debate personally, i do okay. my family does pretty well and i have a 3-year-old daughter and a 1-year-old son and basically the view of inequality critics is that when i try to give them more opportunities, i'm doing something wrong. there pursuit of happiness is less important than somebody born to a poor family. i think that's outrageous. each individual's life matters to him and the people that he loves and cares about and each should be free to make the most of it. the idea of holding some people down even if it's justified by
lifting people up, i think the least you can say that has nothing to do with the american ideal of unlimited opportunity. >> host: is there some country that does better than the united states, here you've outlined a program for us, is there some country that's followed it and has had more economic growth? >> guest: i mean, overall i still think we have been the most productive and greatest and free nation overall. i think certainly there's things in other countries that are better. i think in certain ways there's more economic freedom in hong kong today than in america. as i mentioned with the regulatory side of things, i think there's more economic freedom in some ways in escandinavia than there is in america. i still think that overall this is a country that has, you know, the greatest wealth, the greatest amount of opportunity and -- and at the root a love of opportunity, living in an opportunity rich society is not
easy because you aren't entitled to anything. you do have to take responsibility. you aren't guarantied that job for life so you always have to be learning and trying and really going out there and giving it your all to make something of your life and a lot of people in this world, a lot of people in this country but thankfully not a majority, they don't want that, they want to be taken care of, they want security, but that only comes that kind of security only comes at the ebbing pence of other people, so if we want a society where everybody has unlimited opportunity to make the most of that you are lives, well, here is the place to fight for it because here is really where you have the sense of life, emotional culture commitment the self-made man and individual that's rising by merit and ability. so we can learn a lot from the other countries, at tend of the day there's something special about america that we should be fight to go build on. >> host: well, i certainly agree
with that don and everybody should read equal is unfair and get the different perspective on inequality that you don't get from the press today. thank you so much. >> guest: it's been a pleasure. >> c-span, created by america's capable television companies and brought to you as a public service for cable and satellite provider. >> book tv tapes hundreds of author programs around the country all year long. here is a look at some of the events we are covering this week. monday at the hudson library and in ohio covering author howard means, he will talk about his book 67 shots. we are also recording an event with journalist andrew, aught o
-- author of the nazi hunters. profiles men and women who have dedicated their lives for tracking down nazi war criminals. tuesday book tv is at the library the latest book, parenting and politics from george washington to barack obamament then on wednesday we head to baltimore for a look at the history. thursday joshua cooper talks about his book the seven cents. mr. ramo, vice president of kissinger associates will be in talk. on friday we are back in new york city for forum held at the john j college of criminal justice.
that's a look at some of the author programs book tv is covering this week. many of these events are open to the public. look for them to air in the knee fur chew on book tv on c-span2. [inaudible conversations] >> welcome, to our heritage foundation. we welcome those who join us on heritage.org, for all the guests in house we ask last courtesy check that cell phones and other noise-making devises have been