 These are my favorite types of forums I really enjoy having opposing views and having a nice dialogue on differing views and I enjoy having a very engaged audience. I'll give you a quick run through of the format for those of you who may not have been to a forum event before. We will tend to spend about 30 to 45 minutes up here on moderating discussion on a few general topics and then we turn it over to you to engage with the speakers. Give your thoughts, have some questions. I only ask that you respect everybody else's time. People want to ask questions or apply them themselves. So please try to keep your remarks or questions as short as possible. I'm proud to introduce our panelists tonight. I think this is going to be a great discussion. First to my far left, he probably doesn't have any people say that to me. Dr. Jarnberg serves as the Executive Director of the Anne Rand Institute and the Anne Rand Center for Individual Rights. ARS, Washington DC based public policy art. He's a prominent advocate for objectivism, the philosophy of novelist Anne Rand. Dr. Brook is a continuing editor of the Objectivist's Objective Standard, continuing author to the anthology Winning the Unwinnable War and co-author of Neo-Conservatism and a Bictionary for an Idea. He's a weekly guest on the front page hosted by PJTV, the first center-right online television network broadcasting over the internet. He makes frequent guest appearances on national radio and TV with objectivism's unique perspective on current events. He's a popular speaker at universities, public forums, industry conferences, academic panels, community and professional groups. His recent talks encompass the moral foundations of capitalism and individual rights. Our next guest in the center is David Kellyan. David is the co-founder of Demos, a public policy institute based in New York City and serves as senior fellow and editor of PolicyShop.net, the Demos blog. He's a regular commentator on television and radio and his articles have appeared in numerous newspaper and magazines. In addition, he's the author of eight books including The Cheating Culture, Why More Americans Are Doing Wrong to Get Ahead and The Moral Center. Kellyan received his BA at Hampshire College and his PhD at Princeton University. Please join me in welcoming our guest. Applause So, let's start with a softball. The forum is from the government here to help. Obviously, trend over the past few years, government has been getting more involved in issues from healthcare to banking and other areas. I'll let you both start with just a general philosophy statement. How do you see that trend continuing and why do you think it's either the right or the wrong way? Yeah. Well, I hope it continues. And I think it's the right direction. You know, just to be clear when we think of government, it's not some kind of alien entity. Government is us. Government is a tool that we have to use to do things together that we cannot do alone. And the role I see for government, mainly, is to kind of create the public structures which undergird success in our society, prosperity and a decent standard of living. And so, I think that a key reason that government has been doing more is because there's some big unsolved problems in our society. Health insurance, millions don't have a classic case of a problem that the government has stepped forward to try to address. And the economic collapse of recent years. We still have over 9% unemployment. In my view, that's because government has not done enough. So, just as a very brief set of opening remarks, just to underline the point that this is a tool that we have collectively to use. And the question is not what should government do. The question is what do we as a society want to do together? I can see a bit. No, let me start by first correcting you, Dominique. This is not a recent phenomenon. This is the phenomenon of the last, you know, 80 to 100 years. Government has systematically, no matter who's been in power, no matter which party has run the White House or Congress, government has grown every single year since at least at the odds of administration probably going back to Teddy Roosevelt. So, this is not a new phenomenon. It's an attempt to use government to solve perceived problems, you know, and usually they're framed in terms of perceived problems with the marketplace. This is a tool, as David said, that's being used for close to 100 years. But we have to remember what kind of a tool this is. Yes, government is necessary. We're going to agree on that. I'm not an anarchist. I don't believe government should disappear. I believe we should have a government, so let's get that off the table. And we should have a strong government. You know, a government that does what it does really, really well with whatever amount of money it needs in order to do it. But it should do only one thing. And that is to defend our individual rights. In other words, to defend our freedoms. It should leave us alone. And what it should do is protect us from the cooks, the thieves, the fraudsters. The bad guys who use force against us. Other than that, it should just leave us alone. And I would argue, and we can get into more detail with this, as we go along through the evening, I'm sure we will, I would argue that all the problems that David has mentioned, or the two that he's mentioned in particular, health insurance and economic collapse, are consequence of the last 80 years of government intervention. That is, it's easy to see with health insurance. It's a little bit more complex to see with economic collapse because there's more parameters going on and government involvement in that area has been around for so long. But once you dig in, to me it's obvious that the problem here is not too little government, or way too much government. I agree with David that this is not an issue, this is an issue of what we want. We get the government we deserve, right? You know, people blame politicians, but it's not politicians, it's us. Politicians just reflect back to us what our values are. So the real question is, what kind of society do we want to live in? And I want to live because government is forced. I think we have to be very, very careful in what we let government do, because forces is a powerful thing and a bad thing when it's initiated. And I think that most of what government does today constitute initiation of force, and therefore a bad thing. Let's just stick on that point of force and protection. I too believe that a key role of government is to protect us. And I think that there are many different ways that government can protect us. Government can send police officers into our neighborhood to protect us against street level criminals. Or government can protect us against other kinds of dangers and harms. For example, it used to be before 1966, cars didn't have seatbelts. There were very few safety standards around automobiles. And there was tremendous carnage on our highways because Detroit was making these cars, which were extremely dangerous. Government stepped in in 1966 and said we need to protect consumers against being killed in an automobile accident because of unsafe defective vehicles. The result is that auto fatalities have dropped by 400% since 1966. Now, if you ask me being saved by government because you're not driving a Corbeir, a debt track, or because government has forced Detroit to put in airbags or seatbelts, it's just as good as being saved by the cop from a murderer in your neighborhood. I don't see much difference there. I think there's a huge difference. One is clearly a personal choice. Why shouldn't I be able to drive a car that is a danger just to me? Indeed, I might be one of those people who can't afford a car with a seatbelt because new cars are expensive. If you track the prices of cars since all these safety features have been introduced, they're priced out of the car market. There's significant percentage of population. So what do they do? They buy used cars, used cars, which are less safe in significant ways than those new cars. Have you guys ever seen the movie Taco? I recommend the movie only because now I'm assuming the movie is correct now, which is a stretch because it is Hollywood. But at least according to the movie Taco, Taco was about to introduce a car with seatbelts in the 1950s and was stopped and really destroyed by the intervention of governments and to a large extent by intervention of government in cahoots with the big 301 competition. And this is what happens when government gets into the business of dictating this is good, this is bad, this will save life, that won't save lives, is that once they get that power over the life of business, one of the things that happen is that business now have this need to go to government and fight and argue and lobby and ultimately they succumb to being in bed with government, which at least Taco the movie portrays the big three as being, and manipulating the market for their short-term benefit. We see it short-term because the big three didn't do too well, ultimately. I don't think, you know, you could argue that seatbelts have saved lives, I think they save marginal lives if you consider the fact that it's very, very likely, I think a certainty that they would have been introduced. Anyway, it just might have taken a little bit longer and again I think some people were priced out of the market so they still drove very riskier than mobiles. But the point is, there's a principle here. Once you violate the principle, once you let government start dictating what products are good, what products are bad, what is safe, what is not safe, then the government starts violating each of our rights, it starts using that force in clearly inappropriate ways and, you know, we get the government that we have today which is involved in almost every aspect of our lives and is leading us towards economic, economic, cultural and I think moral calamity. So even if it were true that seatbelts wouldn't have been introduced without government, which I think is very, very dubious, not worth it, still long. So let's stick on the car theme because this is one of the topics I didn't want to get in the opinion from both of you on. I mean, that is, I did well on the industry. That's one of the biggest, I'd say, areas at least in the last few years where we saw government intervention. We had a very major part of our national economy under pressure and the government stepped in in a very big way. I'd like each of your thoughts briefly on did you think that was a successful bailout? Should government, is that a proper role for government and should government be choosing industries in which they buffer to keep going? Well, I certainly think that it was a successful bailout. We still have an auto industry here in the United States. The workers of GM are actually going to get bonuses this year without that intervention. We could have seen the U.S. auto industry virtually disappear. And in my mind, that's a major success. That money is being repaid if it hasn't all been repaid already. It's an example of, you know, you don't want government stepping in left and right all the time to bail out this company or that company. But when you have a major industry in the United States an industry which has been hugely important to this country's success economically that's about to go under. I think that that is a case where you want government to play a proactive role. And again, it is, in a way, that's a form of protection as well because you have tens of thousands of workers not only auto workers, but the subcontractors who depend upon the auto industry the businesses that also depend upon the auto industry sell to auto workers all at risk because of this financial crisis and government stepping forward and playing a proactive role. So yes, big success. This is a fundamental difference between this kind of protection and the kind of protection that's involved in police and the military and otherwise. And that is that this kind of protection involves using force against innocent bystanders whereas Protect Me From Thieves doesn't involve using force against me. Where does the money come to bail out the industry? It comes from bondholders in this case. I mean what Obama did to bondholders in the Chrysler and GM is one of the things that this economy and our legal system will pay for for generations. Basically, he eliminated contract law in order to get his deal done. It was one of the most devastating and horrific things that a president has done in terms of respect for the court system contract law and how contract was respected and we will pay for that freely because once you set a precedent like that it's gonna happen again. But the point is that somebody was sacrificed. Somebody had to pay in order to protect X number of people. So for Chrysler's employees to preserve their jobs and yeah clearly they preserved their jobs somebody else had to give up something. Why? Why is it their fault that Chrysler goes bust? It's not my fault. It's not the bondholders fault. It's not the fault of a lot of other people who landed up having to pay the bill. So there's a difference here. One type of protection by protecting rights at nobody's expense other than the bad guys. Here it's about violating some people's rights in order to give goodies to other people. Now let's talk about the economics of it. One of the most disastrous things that has ever been done in the American auto industry was the bailout of Chrysler in 1981 I think it was by the Reagan administration. Not only was it this... And one of the reasons for disasters was because it worked in the short term. The government got all its money back plus interest so they now think we're good at this. We can save industries. But what is the consequence of the Chrysler bailout? The consequence of the Chrysler bailout is this bailout. The consequence of the Chrysler bailout you saw it immediately after you saw it in the 80s and you saw it in the 90s was the fact that more hazard kicked in more hazard means your downside is protected when you know you can't go bankrupt because the government will bail you out. You don't make the effort to be as good as you could be. You don't make the effort to be world-class. And that's exactly what happened in the American auto industry. Chrysler was for a brief period a really good auto company coming out of the bailout. But then if you think about the hell, you can cruise because we get into trouble with your bailout. It was they engaged in a disastrous policy. Built lousy cars were competed into the ground by the Japanese and more recently by the Koreans. And the auto industry fell apart. And that's why it needed this car to bail out. Now what have we taught these auto companies now? Don't worry, be happy. What have we taught the employees of these automobile companies? Don't worry, be happy. You don't have to make the best cars in the world. You don't have to be competitive long term. Just make the same old crap you used to make. Not grander for a few years don't make better cars. But then they'll go back to making the crap and they'll have to bail them out a few more years from now. Instead, they should have gone into bankruptcy properly. They should have been woken up. People should have had to pay for the mistakes that they've made for years and decades including the workers, including management, including shareholders that should have been wiped out, people wiped out at least in Chrysler. Some holders should have taken a hit. Everybody involved in those companies should have taken a hit. According to the law, the way the law dictates that you should do it. According to the contracts that were signed. And what would have happened? What would have happened was that some of those assets would have been sold. They would have still been automobile manufacturers in the United States. It would have been a lot less than it is today. There's no question about that. But then they would have felt, okay, now we really have to compete. against the Japanese and the Koreans and the Germans and everybody else. Because there's real downside. And when the bond holders would have given their money, they would have said, give it to them because we want to make sure that you guys can survive. Because we don't want to go through bankruptcy again. Shareholders would have been really diligent with management. Instead, you're going to get the same story over again, I don't know how long it takes. It takes five years, it takes 20 years. And by the way, like the government has now received its money back. GM stock has to go up, maybe with a decline of three times. But anywhere between two to three times where the government is going to get its money back. But they probably won't. And they'll learn to do all the lessons that they could be good at this. David, do you have a response to that? Well, this story about the American government being responsible for Detroit making bad cars that I don't really think holds up. For one thing, the auto industry is abroad. Japan and Korea's auto industry have benefited from major state involvement and support much more in many cases than the United States. So this notion that the government, the big government, is what is what ruined Detroit, I think is just false. Okay, but maybe we can move on too. Yeah, yeah, well, we'll cover a lot of topics and I know that there's other topics out there. I want to address this next question to John Brooke. A major presidential candidate recently called Social Security of Ponzi scheme. And I don't as someone who doesn't have to believe that there might be there, and it's a personal view. But on the other hand, I do see Social Security as an area where government has tried to help protect people in terms of providing proper assistance down the road when they retire. What you've used on Social Security, I know we're going to get different answers here, but what do you use on Social Security and do you buy into that statement that's a Ponzi scheme? Well, I pretty pissed off because I called Social Security a Ponzi scheme about ten years ago. I know people who called it a Ponzi scheme even before I did. So, Perry, you know, didn't attribute it to the people who should be attributed to. I think that's really a Ponzi scheme. I actually think it's worse than a Ponzi scheme. Because you had a choice of whether to participate in road off scheme or not. With Social Security, you have a gun pointing to your head and you have to participate in the Ponzi scheme. You have no choice. Try not paying your payroll taxes and you'll see what happens. You go to jail. So, this is a Ponzi scheme with forceful idea which makes it much worse. Now, why is it a Ponzi scheme? A Ponzi scheme has one particular characteristic. And that is that the returns that you pay people come from their own capital that they put in. Not from return on the capital but from their own capital. Plus from the money being put in by new people. Right? So, that's why as long as you have lots of new people coming into a Ponzi scheme, it seems to work. This is how Bernie Mader worked for a while, right? Because as long as you can convince more people to put money in, you pay the old investors out from their new money and you can keep that going for a while. The problem is once the base starts shrinking once you get pure and pure pay into the system and you've got more and more investors that now want their money out and now you can't pay them out and that's when the Ponzi scheme collapses. That's ultimately what led to Bernie Mader collapsing. It wasn't the SEC. It was in very nature of a Ponzi scheme which is self-destructive and you're seeing exactly the same thing with Social Security. What happened in Social Security seemed to work great. As long as there were a lot of young workers and very few people were timing and their time and age was also very close to where you died. The time and age when Social Security was supposed to initiate was actually above the average life to continue out of the state. Then it's easy, right? As long as you keep getting a lot of people putting money into the system and using that money to pay it out, then it works. But once it flips which is clearly flipping with the baby because that is a lot of people receiving stuff that they don't have people paying in. Plus, you reach 65 you're likely to reach 85 and many people actually are reaching 90 to 95. There's no way for that system to continue working. There's no way for that system to continue working. It's exactly in classical Ponzi scheme. Let me just ask you very quick and if you just give a very quick response to this. What's the solution then aside from Social Security? It might be Social Security worse than the fact that it's a Ponzi scheme is that it's game all, but I can't answer that in two seconds. If you let it come back to me, it's game all, it shouldn't exist, it should be phased out. You can't eliminate it, but you can phase it out and there are various methodology by which you can phase it out. Chile is a good example where they privatized it but there are lots of different ways in which you can do it, but the government should not be involved in a scheme a Ponzi scheme to try to guarantee anything for people of old age people should be responsible. So let me ask you David, and he says it's more people paying in not going to get out in return. Maybe there's an answer to that is it raise the limits or what do you think of? Well let's come to the finances in a second, but just on the sort of broad principle here. What Social Security is not a Ponzi scheme it's a social insurance program which is basically one of the great inventions of modern government which is that we as citizens collectively all kick in to insure against destitution in old age. Some of us need that insurance more than others. Social Security also has a disability and survivors benefit part so if you're you know you lose a spouse you lose a parent you can get a payment, if you're disabled you can get a payment. It's an insurance system and people at the bottom often benefit more in this system, sometimes not and it's insurance system that has worked phenomenally well. I mean once upon a time in America the elderly were some of the poorest people in our society. A lot of people worked until they died in 1945 half of men over the age of 65 were in the labor force today it's down to 15%. Why were they all working? Even as old men? They had to work. Otherwise there would be no support for themselves. Even in 1960 when America was a hugely prosperous society a third of all elderly lived in poverty you remember the sort of stereotype the elderly people living off of cat food well that used to be the reality and then what happened is we beefed up the Social Security system starting in the late 60's and early 70's by making payments more generous by pegging them to cost of living and inflation and we created a system that actually protects elderly against poverty which is one of the greatest fears people have in life. The notion that you're going to be an old person with no resources whatsoever totally vulnerable. Well thanks to Social Security and Medicare which we can talk about that is less of a risk. Today under 10% of elderly people live in poverty still too many because those benefits still aren't generous enough. Now as to the question of Social Security's long term finances this is not where the big fiscal challenge for the United States lies. It's more in the healthcare system. Most Social Security experts, the people who've been the commissioners in the system suggest that Social Security can be made solid over the next 75 years through a series of kind of nips and tucks a combination of pretty small changes. Trim benefits for more affluent more affluent recipients slow down the cost of living change the formula by which cost of living increases are made raise the cap on payroll tax. It's supposed to cover 90% of wages it's fallen behind and some other sort of small incremental steps like that can be taken to make the system solid for the next 75 years and protect people against poverty. This is government at its absolute best when we as a society come together to solve a problem that had deviled civilization you know for millennia. Let me just say first I agree about the finances. Social Security is not a problem. Social Security can be fixed fairly easily with the kind of combination of stuff that David mentioned. I would also increase to a time age I think that's probably part of that package you didn't mention. Social Security is not a financial problem. It can be solved. Medicaid what is a magnitude larger fiscal problems the fundamental problem is that Social Security is a moral problem. It is a decadent, horrible program that actually encourages people not to say not to think about the responsibility for themselves in an old age not to buy insurance or the proper kind of insurance. It destroys proper long-term care type insurance markets with these things relatively cheap if we bought them young but we don't even think about it and care about. It's also it's a system that rewards in my view the worst kind of behavior. It rewards the responsibility. It rewards the person who gets a paycheck and spends it all the next day instead of and it penalizes the person who gets the paycheck and saves a little bit of money for old age. Those are the people who get penalized because of the turn they would get that money and the most conservative investment you could imagine is all exceed the return they'll ever get on Social Security. What it does is it rewards irresponsibility and it penalizes responsibility. We can draw pictures of millennium that as far as I know at least 100 years ago the life expectancy was well under 65 and 200 years ago life expectancy was below 40 so people haven't reached old age in recent time. There's actually nothing wrong with men looking after the age of 65 I certainly hope I'm looking perhaps the age of 70 and some people are going to be responsible and save and they're going to do fine and other people are not going to be responsible and not going to save and they shouldn't be responsible. Just to be clear I mean Social Security is a form of saving. We're paying payroll tax every time we get we are saving through Social Security. This is one of the brilliant things about it. It is compulsory saving. It is making us save because as we know a lot of people don't save and it's not because they think Social Security is going to be there to solve all their problems a lot of people don't think Social Security is going to be there. People when they have 401Ks don't put enough away because they want to live in the moment so Social Security is a fantastic way to force people to be responsible by saving and as for oh yeah they could get a better return from the stock market well how many people in this room like their retirement security depended upon the stock market. We've had we've had two major crashes of the stock market in the last 12 years that have wiped out people's retirement security those people who are about to retire me having your money in the stock market is great unless you do that money when the stock market is down and that doesn't even get into the questions about fees and the cost of the newization Social Security in fact is an excellent deal. But David that's a strong man I never mentioned the stock market I said in the most conservative investment you would do better with putting in CDs in the bank every year all the old CDs you do you make a better living and buying an annuity you do better buying an annuity than you would with Social Security it's not forced and you the responsible one don't land up having to subsidize those people who are too lazy or whatever or too short term or too irresponsible to put their money I am going to get less from my so-called saving account because I am subsidizing other people who are not going to save I want to subsidize and if I want to help them that should be my choice this goes back to the point government is forced government is forcing us to save that is wrong it is evil for somebody to tell you how to live your life your life is yours to live are you pleased and if you don't save your problem you cannot pull a gun and force me to provide you with the time David I'll give you the last word on this one and we'll move on nobody is pulling a gun this is a choice that we this is a choice that we together as a democratic society have made Social Security is a hugely popular program and maybe the most popular social program and if you don't like paying payroll taxes I'm sorry this is what happens when you live in a democracy individuals don't get to make all of their own choices and this is something that Iran is going to come back to again and again this notion that we should all just be able to opt out of the social contract that we shouldn't have to do certain things just because we don't want to do them well that's not the way the real world works there's no social contract we'll move on to another topic but we can always come back to this in a little bit if anybody wants to fall off I want to talk a little bit about an agency I know well and I won't interject my personal or day job into this but the FDA is an agency where there's definitely strong views on both sides some people argue that the FDA is woefully underfunded and needs to be beefed up to get more involved some people would rather see it go away you can imagine who has who may have which view so David I'll let you have the first one on this one talk about the FDA and what do you think the state of it is and should it do more well the FDA is one of the oldest regulatory agencies we have it was created in 1906 it was partly a response to the furor surrounding the publication which famously revealed the horrible truth about slaughterhouses and how our meat was made and since that time it has grown and taken on a lot of new responsibilities as we've seen the rise of the pharmaceutical industry and a number of other things I mean I think that before we had the FDA thousands of Americans died of food born illnesses this was just sort of one of the basic realities of life which is that maybe you eat something and die right and that is something that we now sort of take for granted that we don't have to worry about I mean there's E. coli here and there certain kinds of outbreaks but for the most part when you buy something and serve it to your children you're not worried that they're going to die as a result and that is a huge triumph of modern government one that you know we don't even reflect on so much because it's just been such a kind of basic part of our texture we take for granted that when our doctor gives us a prescription and we use it that we're not going to die at some horrible side effect that was not seen because those drugs have been tested and you know to be sure there are problems with the FDA and let me just say in general I think that government has problems just like large corporations have problems just like any large institution has problems there are problems with government there are things that need to be streamlined it would be great if it were possible to streamline the drug approval process so that people could get vital drugs more quickly but that shouldn't distract us from the fact that this is a vital role and a big problem of the FDA is that it is often in recent years not offered the protection it needs to offer so I mean we were chatting up here about the drug Vioxx that people will remember from a few years ago that Merck introduced and you know Vioxx ended up being a very dangerous drug that killed a lot of people a lot of people died because they took Vioxx and it turned out that there had been some trials that suggested that maybe Vioxx would be a deadly drug and that the allegations are that Merck started to sweat that under the rug because it had the potential to be hugely profitable that's where we need a stronger FDA in those kinds of situations so as you can imagine people forget that the jungle was a piece of my rocking fiction after all it was not meant to be a non-fiction work and it's never been scientifically shown to be true but put that aside I believe the FDA kills many many more people than it helps and I'd like to talk about Vioxx because I think Vioxx was a fascinating example of what I think is wrong with the FDA so here was a drug that became a painkiller basically that many people who had arthritis and other diseases that involved intense pain took it and it turns out that in a significant fraction not a negligible fraction of people, Vioxx created heart disease and people had strokes and heart attacks and some people died of it of use of it on the other hand Vioxx some people swore that it was the only drug that prevented their pain and for some people that pain was so excruciating that they would be happy to take the risk of heart disease and a heart attack in order to be able to take this drug in order to avoid the pain that it inflicted to what government does government is forced it prevents those people from doing it why shouldn't a person have the option given that information to take a choice with his doctor should I take Vioxx given all the risks or shouldn't I take Vioxx why can't a woman with breast cancer make the choice given the knowledge that we have today about, I think it's Addison that in a few cases save women's life in many cases has no impact why shouldn't she have the choice of deciding I want to take this drug I know it probably won't work but it might, I mean not anyway why should this be a decision made by individuals with a doctor rather than a decision made by some bureaucrats about what drug we can and cannot have now if you do away with FDA what would happen what would fill the gap because the argument would be what would get this information it's easy for you to want to say this it provides us with information about the risks and it lets us know well there's a huge market for this a huge market for this information why have an enterprise would fill the gap there would be lots of labs that would come in probably not lots but a few labs that would come in and test the drugs and they wouldn't ban drugs what would they tell you is what are the positives what are the negatives what are the risks and you it's your life after all it's not daylight you make the decision what to take and what not to take and what kind of risks you're willing to take with your life for what kind of a benefit who should play god here who should be in a position to tell us what kind of risks we should take with our own lives and with our own health that's something we as individuals should do with our positions well I don't think that we should be making life and death decisions based upon what we're told by a pharmaceutical company interested in making profits says is good for us or for that matter unfortunately being told what doctors think because as we know the pharmaceutical industry has fundamentally corrupted the medical profession the pharmaceutical industry spends twenty billion dollars at least marketing its drugs ninety percent of that money is spent trying to influence the drugs that doctors prescribe and as we know there have been all sorts of huge scandals almost every single American pharmaceutical company has been sued by the US Justice Department for illegal practices when it comes to marketing their drugs and particularly around influencing doctors to push them to with cash gifts with incentives with other kinds of perks to prescribe some drugs over others this is exactly where we need a neutral body that we can trust because leave this kind of stuff to the market and people are not going to be protected so again it comes back to the sort of fundamental role of government we together deciding that we want to protect ourselves against these possible dangers we're going to start moving into the audience portion soon so if you want to ask questions again as Jennifer said you can start lining up with either of these two microphones here remember that if you ask a question you are sending to being recorded I'll give you a last word and then I'd like to get to the audience one of the greatest injustices that anybody this is true of Republicans and Democrats because they all do this one of the greatest injustices we committed in our society demonized drug companies these are the companies that are making the drugs and making the medical instrumentation that makes it possible for Americans to live to be in the 80s and 90s and not just Americans most drug discovery most medical innovation happens in this country 75% of all medical innovation in the world happens in the United States because we're still the freedom although that's disappearing very quickly these are the companies that have allowed us to live to be 85 and in many cases today growing up of cases 95 and over 100 these are the doctors and drug companies that make it possible for us not only to live that long but to live healthy lives into those ages the idea that they are somehow poisonous and killing us went all out and suggest quite to the contrary we're living longer better lives than ever before these are something that's heroic virtuous companies that make human history and they should be celebrated if you gave me two institutions one institution tells me that they're providing me information based on the profit motive because they make money doing it and another institution that providing information actually doesn't just provide information but of course forces me through their actions one way or the other in order to preserve the common good or the public interest I take that profit motive any day any day I'll give you the last word on that well on that point I do hope we get to the topic of predatory lending at some point one last point about the pharmaceutical industry you know I agree with you Ron that these pharmaceutical companies have done some amazing things and just as a general point I think capitalism does some fantastic things I mean this is a phenomenal system capitalism the market for creating wealth for creating inventions for giving us things like you know the iPad or Viagra he's from Pfizer you know I mean like we all benefit from the market from capitalism but it is also a dangerous system and it has you know it has some negative downsides that we also have to manage as a society and I think what we want is to kind of get the balance right you know we don't want so much regulation to kill the goose that lays the golden egg but we don't want so much of a wild west situation that there's a lot of kind of casualties because there's not enough protection from people engaged in unscrupulous pursuit of profit so audience questions I'm going to start over here I'll alternate back between the microphones and again please try to be considerate for those standing behind you I disagree with both of you that social security can be same let that go speaking of Governor Perry three counties in Texas opted out of social security more than 30 years ago people are their workers are retiring at more than twice the rate that they would get from social security the death benefit is runs up to more than 800 times that of the $255 that social security pays you couldn't buy a coffin for that so my question is this to Mr. Callahan what logic do you defend the use of force to prevent workers from participating in private systems what's the morality behind that and Mr. Brooke I believe your Ph.D. is in finance I suppose you would have something to say on the economics of this if you would well just to clarify the workers who are that's opted out of social security are public workers in municipal governments public workers are allowed to opt out of social security in some cases and yes public sector workers often do get better return than they would from social security because their pensions can be invested anywhere and their pensions are invested often in hedge funds highly profitable investment investment vehicles they get a better return and as a result social security has only been invested in US Treasury securities because there are people who said oh we can invest social security in the stock market because that's too much big government so one reason social security hasn't been invested in a more balanced portfolio is precisely because of those concerns in terms of the question about force I mean this is the nature of insurance if an insurance system is to work it has to participate in that insurance system because if only the people who think that they're going to need the insurance to participate then you have then you have an insurance system which ends up not working like this is why this is the reason for the mandatory healthcare the individual healthcare mandate that everybody needs to have health insurance in this society pools are going to have enough healthy young people people who often opt out similarly with auto insurance that everybody needs to have auto insurance not just the people we know to be the bad drivers well that's just not true so insurance functions fine with only some people participating as long as it's a diversified pool you certainly don't need everybody to participate in insurance but insurance pool to function and there are lots of examples of that from home insurance to auto insurance in states that don't require everybody to participate there's no fact that many auto insurance companies those insurance pools within those companies still function even if everybody else is with other companies so there's absolutely no reason everybody has to participate in insurance policy but social security is not insurance policy social security insurance is voluntary that's a nature of insurance you buy it, you cannot buy it you can renew it that's the nature of insurance policy social security is a system that forces us to participate in it and there are insurance financially insurance is going to be lower you're right, I don't think any of us at least I don't want the government investing in social security and stock market and hedge funds they would be the dominant player and it would basically be a form of socializing American industry and making the government the largest player in corporate America so I'd like this I'd like this social security to avoid that as much as possible but yeah I mean for a time we would return formal money to a Tirees annuities would return fall grade returns to a Tirees that does social security for those who participate those who don't won't get anything and that's the problem for David right he's not willing to let those people who are irresponsible and won't buy those policies he's not willing to let them suffer the consequences of their bad decisions and he wants those people who are responsible and that's why he's there I say no, I say we shouldn't use force that is responsible next question Hi, my question is for David you've mentioned several times tonight that you don't believe the government is doing enough in a number of areas so my question to you is do you ever envision we will reach a point where in your professional opinion the government is doing enough to help all these endangered constituencies that you might look like that's a great question but also maybe you aren't going to talk about maybe an area where you don't think we do I see the kind of society I would like to live in is a society where government played a more active role in ensuring health care for all and removing in that direction if we live in a society where everybody had health security that anybody knew that if they got sick there would be treatment for them and they could have care and they weren't going to go bankrupt as a result they weren't going to lose their home I mean a huge number of personal bankruptcy something like 30% or more are caused by medical debt people who get sick even people with insurance who get sick and end up losing all of their wealth and I think that that is not the kind of civilized society that I want to live in it kills me when I buy a newspaper from some guy on the street selling a paper and I think that guy probably doesn't have health insurance that guy gets sick he's going to be wiped out I don't want to live in that kind of society I would also like to live in a society where government played a massive role in dealing with the biggest threat of our time which is climate change and the fact that we are a disagree yeah while I I'm not surprised you know that we're basically creating a future in which our grandchildren are going to face very serious climatic disasters that seems to me an easy problem to solve that government should play an interventionary role there in a very simple way which is raise the price of carbon and let the market do the rest simple kind of intervention anyway I could go on but I see that there's a lot of things that we're still not doing ultimately I'm not imagining that I want to live in a Sweden or something this is I think the United States is a society which once a kind of more robust balance between the market and the government I think we can get that balance right but after 30 years of deregulation and beating up on government I think that we're still a ways even with two years of a bone we're still a ways from getting that balance right so you are how about an area where maybe we don't do enough in government yeah we don't do enough to catch crooks because we're too busy with the nonsense that is the regulatory environment that it is that we've created and I think the classical example is my favorite example is the Boney Mado here's a crook here's somebody clearly stealing that we both agree should go to jail right to me this is the only legitimate function of the SEC is to catch Boney Mado this is their job both find people who is stealing billions of billions of billions of billions of dollars from hardworking people you know whoever it is and he wasn't the only one there was a bunch of these Ponzi schemes going on in a country during the 2000s and it took years and years to catch them but Boney Mado is unique in this sense that SEC got memos from a hedge fund manager two years in a row six, seven years before they caught him telling them exactly what he was doing and they ignored it now why did they ignore it it's not because they love Boney Mado but Boney Mado was a very prominent guy so there was a certain political cache that he had which I think explains SEC's political so they wanted to avoid it but I think there's more to it than that the reason they didn't do it is because they didn't have time they were too busy watching me because you know I when I talk I have to report what I do to the SEC I have to fill out 10 Gs and I buy part of it 5% of a company the regulations calm down and if I buy 10% I have to explain my purpose and they have to read this stuff and they have to determine if you're a good guy they're so busy monitoring economic activity legitimate legal and economic activity that they don't have time to catch the cooks so that's what I think what we need is you don't need to add it to the budget you need to reduce the budget but if you eliminate all the junk that they do which is 99% of what the SEC does and just focus on criminals that actually catch a Boney Mado wait a minute I want to have a comment on healthcare how about we go to the next question and we'll keep going on I'm in the SEC let's keep going I'm sure we can always come back there are a lot of topics on the table still back to Social Security 2002 trustees paid economists 75 year projections on Social Security Medicaid they wouldn't put it in the documents it was 45 trillion it rid of the total military budget 45 trillion is a big number BU economists I'm waiting to make a point we'll discuss a solution with it I wrote a book in 2004 it went to 66 trillion here no people see no people are you aware of the generational accounting issue what are your suggestions let me just deal with the numbers because I think the numbers are interesting hopefully there will be another Social Security Medicaid those three programs are in accounting terms in unfunded liabilities of about 100 trillion dollars depending on how you do the numbers it's 104 90 something but it's something in that range most of them an overwhelming number there is Medicare and Medicaid the dominant proportionality is that Social Security Medicare and Medicaid and interpayments on the debt consume every dollar of revenue in 2015 under very generous assumptions in terms of economic growth between now and then these issues are big issues these are not small numbers these are big numbers let me just make a recommendation there's a study out there called USA Inc by a woman named Mary Meeker who works with client bookings and she's got a 300 PowerPoint presentation just the numbers it's a document the left and right are signed off on Al Gore and some Republicans so she's just an adult and the numbers are quite stunning and really interesting because she puts her in graphs and she shows you exactly what's going on so those are kind of just from a physical perspective that's kind of the challenge that we face as an economy David? Sure I do think we've talked a lot about this the question, but we'll move on to another topic Thank you I have a larger sort of philosophical question we've heard that the reason individuals sometimes can't make our own decisions is because we live in a society and we're subject to a social contract because we do and Dr. Brooke very briefly said almost under his breath before he moved on to another topic that there is no social contract so Dr. Brooke would elaborate on that statement Yes I don't believe there is such a thing as a social contract the contract is something that we consciously purposefully voluntarily enter into when you have a contract you do something consciously to exercise that contract you're born you didn't choose to be born you didn't choose to be born where you were born so I don't believe there is such a thing as a social contract I think there is one I think you have to look at it differently this is the way I look at our lives in this society I believe that human life depends on one ability that we have one characteristic of human nature and that is our ability to reason our ability to think our ability to project into the future our ability to plan our ability to reason I believe that society should be organized in a way as to leave us as individuals to be free to reason to reason our way to our own happiness our own success to our own values now what is the enemy of reason in my view the enemy of reason the thing that destroys reason makes it impossible to think makes it impossible to create makes it impossible to grow as an individual when there is a gun put at your head you don't have a choice if you do what the guy tells you with the gun and the head reason is out the window so the pseudo social contract the only agreement we need to have in this society and this is why we have government this is why the government is important is that the gun goes away if you think about human history force has dawned in human history human history is full of people forcing other people to do what some people wanted other people sometimes it was majority sometimes it was minority it was always through force the great revolution there was the enlightenment and age of reason and the founding of this country was a rejection of that idea and the idea that we as individuals have a right to our own life and as a continent nobody not a majority and not an individual has the right to force us to do something we don't want to do to protect us from criminals protect us from money made up protect us from people pulling guns on us that's it and other than that we are free to make our own decisions to our own rational values the way that we believe best serves our own hands David? well I mean the great advent of the enlightenment was that the king would not have arbitrary power over us over ourselves and we could use that power to create the kind of society we wanted and you know many people want protection from things beyond just a guy who might rob us or hurt us we also want protection against the company that might pour DDT into the river upstream or into might poison our well water as has happened in numerous places we want protection poisoning poisoning the groundwater resulting in cancer we want protection from that if your kid dies from cancer because some corporation was trying to cut its cost by putting toxic chemicals into the environment that's just as dead than if they were mowed up and robbed and murdered on the street we don't have to argue about that poisoning somebody is a use of force against them so one of the extension the other thing that we have decided to do collectively as a society is protect ourselves from massive economic misfortune from destitution from you know remember the new deal modern social safety that came out of the crash the great crash and the great depression this sort of huge economic disaster large numbers of people out of work and it's perfectly reasonable for a democratic society to come together to choose to create forms of insurance that will protect us against that kind of misfortune because you know if you're wiped out financially because of you know Wall Street has been turned into a casino and people are taking crazy risks with derivatives and what have you that's just as bad as having your house robbed that's worse than having your house robbed that is a form of not theft but that's a form of of real harm so nobody is forcing anybody to do anything we live in a democratic society we have made these choices collectively the minority does not always you know individuals don't always get their way there's certain things I would like to see government do that it's not doing there's certain things government does that you're on doesn't want it to do nobody always gets their way but I think that it is completely misleading to keep using this metaphor gun at your head that you know so security payroll tax this is somebody putting a gun at your head this is forced this is some kind of alien entity it's coming taking your money no this is a democratic society making shared choices about how to create well-being for all of us nobody always gets their way in a democratic society I do want to move on the next question that was a very good question I thought we had a good sorry I changed there but I do want to box there are people more people we're running close to the end of time thank you for that question I have a question about the FDA because that's kind of where I came in a statement was made by your on it said you said that an individual would be willing to choose a drug because the pain you know nothing can be worse than that so I'd like you to elaborate on how somebody who's in that much pain and that much mental stress would be capable of making a decision such as that and the reason I'm asking is because there was a drug Accutane which was like a skin killer drug and you know you're a teen you have acne you're like I would do anything well the thing is is that Accutane turned out to be very dangerous you know severe depression suicidal thoughts etc etc when you're a teenager first of all when you're young you're like I'll never happen to me you know like yeah okay maybe that guy over there but not me and so they were in that position to really take control of the risks so how somebody who's in severe pain able to evaluate and make a logical decision that somebody should be able to so what you're asking is if you as an individual are not in a position to make a rational decision who should make it for you right and I would argue that the people should make it for you is whatever you designate and I know I have a living will where if something happens to me and I can't make a decision my wife makes the decision if you're a teenager your parents should make those decisions if you're an adult and you have good friends and you don't think you're in a position but the people who shouldn't be making those decisions are a group of scientists and bureaucrats that attach for you who don't know your risk preferences who haven't talked to your doctor you know we talk about personalized medicine everybody wants to talk about personalized medicine personalized medicine would be great but we're never going to get personalized medicine with FDU because personalized medicine is about you your particular biological needs discussing with a person who knows this your doctor knows all your conditions and making decisions about the kind of treatment you as an individual needs no group out in Washington can make that decision for you now may I ask a follow up? well it's very interesting to say but would your life really have an objective opinion if she sees you in pain every single day but that's my problem it's not yours my point is this my point is this the majority doesn't have a white over my life 51% of the people don't have a white to decide what I should what drug I should take and what should not take each one of them they are and excuse my metaphor they are pulling a gun to my head because you know people this is a coup to people where they want to take a particular drug they've got a deal they've got the money to buy they go to the pharmaceutical companies and they are physically restraining from taking that drug because the majority 51%, 61%, 99% I don't care it doesn't matter don't think that that's good for them maybe you know I have a friend who is getting older and he's worried about those kind of late of life decisions and he's written a will that doesn't give it to his wife because he's worried about exactly your argument see he's given it to somebody else who trusts to make an objective decision but it's his life he makes that decision you don't make the decision for him you guys don't make that decision majority are not don't own your life this is why we talked about the enlightenment I said that it was about you owning your life David said we own our lives so the king doesn't do it we decide no the king doesn't do it you decide not to have another back and forth on the FDA but I want to pull out a kind of broader point here which is like individuals having enough information to make the right choice and one of the reasons we have government regulation whether it's over drugs whether it's over consumer products like cars is because of overwhelming experience and evidence it's hard for individuals to have enough information to make the right choice you know the world that Iran imagines would work effectively is one where everybody has perfect information to be able to make to be able to make these kinds of choices and I think that it's very hard to have that kind of perfect information if a drug is brought to market without going through proper trials and the pharmaceutical companies are pumping it with billions of dollars in advertising and they're paid off doctors are pushing it too and you know you're feeling some duress well you could make a decision that ends your life based upon wrong information and this is where actually you do want those scientists who are objective who are detached who aren't in the pay of the pharmaceutical industry who aren't a relative that just wanted to hear you stop complaining about your knee or something this is where we want that objective knowledge and we as a society have over time given the FDA more power to make those decisions and these regulations to protect food and drugs and consumer products from killing us these are very popular thank you very much for that question so my question is about the EPA there's been some growing sentiment against the EPA particularly by certain politicians who support smaller government roles take for example who has said that he would do all he can to limit the role of the EPA which is a job killing organization and yet at the same time there's a massive disconnect this is a man who receives massive financial support from the oil companies and through campaigning donations and his state has had record breaking consecutive days over 100 degrees is on fire there's significant scientific evidence that suggests there is climate change happening so my question is without a neutral body like the EPA how can someone like me stand up against the massive inertia of the oil companies whose profit lies in continuing to destroy our environment for example fracking which has been shown to be pumping toxins into our groundwater how can I when we rule that corporate money is speech how can I stand up against something as massive as an oil company without the EPA backing me that's one for your honor so first I want to go the other the second biggest injustice that we commit as a society going after drug companies is that we go after oil companies and maybe oil companies should be number one oil companies that benefit of humanity as much are more than drug companies you couldn't imagine your life it's unimaginable to you life without oil companies the products that we get from the plastics and the transportation and everything that is oil a lot of this room is built from oil it's just unimaginable so let me just say I'm a huge fan of oil companies I think oil companies are one of the greatest beneficiaries to mankind in human history now what do we do about environmental problems if I have time I'll say what I think about global warming let's keep this one quick quick we have a few more people I suspect based on my reading and my understanding of the environmental threats so-called threats that we face is that most of them don't exist and that the few that do exist the few that are true poison that David mentions and I'm sure there are others that's what government should be about that is government is there to protect us from violating our rights, our property rights when some chemical is out in the air clearly harming human beings then you know that's all of government to deal with that but that is a tiny fraction, a tiniest fraction of what the EPA actually does most of what the EPA it's astounding to me that somehow the EPA and the FDA and all these are somehow objective entities and this influence and more influence by political agendas of various parties than profit seeking organizations that are primarily influenced by money and long term money long term profit which is a much healthier thing can I give a global warming view? can you do it in 60 seconds if I could do it in a chance I'm willing to grant global warming so let's start with that let's grant the fact that the earth is warming I leave a willy to grant I'm going to say that it's even going to be somewhat catastrophic I think it's ridiculous and the scientists have shown it that it's going to be horrifically catastrophic but let's even assume that it's going to be mildly catastrophic that it's bad the solution is freedom, capitalism and technology let's get really really rich so that our grandchildren are so rich they can deal with it in their own way applause I'm going to give you a few minutes just on the EPA in my mind the EPA is another fantastic example of the success of government and if you want to be reminded of that visit China and go to one of those Chinese cities which are choking in air pollution where thousands of people are dying every year because of the dirty air in those cities this is what American cities used to be like not maybe not quite that bad but terrible enough that huge numbers of people were dying from air pollution we used to have rivers that caught on fire we used to have water that killed people because of the contaminants in it the environmental protection agency which we empower democratically to protect us has been a huge success in cleaning the air in cleaning the water in creating a higher quality of life in my mind Iran keeps saying this has been a disaster this has been a catastrophe actually I think American society has been doing pretty well over the past 50 years we've become one of the richest societies in history we have increased life expectancy from 50 to 78 since 1945 we have increased the kind of amenities that we all enjoy in terms of cars and homes the amount of education we get we have become a phenomenally rich society at the same time that we have seen the rise of the big government that he keeps saying is so catastrophic and I don't think that it's a coincidence that we have had the rise of this great prosperity and the rise of government over the last 60 years I think that government has helped create the conditions of that prosperity by helping create the modern middle class by creating what are we can drink air that we can breathe cars that we can drive without being killed and it's like I don't see where the disaster is here I think that this society is working pretty well with some ups and downs and that we have got the balance pretty right we have a lot of prosperity from the news that lays the golden egg from capitalism from this dynamic system and we have some government regulation to prevent bad things to protect us against economic misfortune we have a balance here we have a mixed economy that's been working pretty well thank you for that question this is a question from Dr. Brooke I think one of the biggest mistakes, although honest that the founding fathers made was putting these fireworks into the constitution which was provided for the general welfare what do you think was the actual intentions of the founders because you know if they foresaw what was going on today they probably wouldn't have put those words in there so what was that intention provided for the general welfare when they put it well I think they had a perception of the general welfare as the welfare of individuals, they were individualists they believed in individual freedom and individual rights and their view of the general welfare was that the government should not interfere in your ability to live your own life in the best way that you could live it so yeah I think the founding fathers would be horrified and would be devastated by what has happened to this country and let me just comment on why things are so bad first the improvement in human life, the improvement in quality of life and life expectancy and everything were far more dramatic from 1800 to 1913 than they have been from 1913 to today and again if I had time I'd give you lots of illustrations of that but that's where the real action happened in terms of the improvement and creation of the middle class and everything else it's gone bad since then absolutely this is like unfortunately it looks like it's going to take a major collapse of civilization but they have to listen to opposition because life is pretty good, why think but I think let me say this I think the real problem is what could have been what we're missing is what freedom could have resulted and I'm not just talking about the materialistic side we can talk about bad cause and fast cause whatever that's not what I'm talking about I'm talking about the sense of freedom that an individual can have in a free society I'm talking about the spirit of a free people I'm talking about the poor in this country who are being institutionalized into poverty who today are burdened with that entitlement mentality that is killing them not killing them materially because we keep them alive but killing them spiritually and Thomas Sowell I think is a phenomenal job to document what has happened particularly to the bad community since the introduction of welfare the welfare, the social security all these entitlements have destroyed the human spirit and particularly, you know Iron Man said this and I think she was actually the biggest victim of statism of state intervention of restriction on individual freedom and the victim is the ambitious poor the poor would want to have a better life they are institutionalized into poverty they are told that's not their role in life and they are told back and as a consequence the mobility of the poor's mobility and you know we're sure the social mobility in this country has deteriorated dramatically since the 19th century and the less poor are becoming rich and the less rich are becoming poor exactly because of the growth of government because of the growth of all these so this is much more of a spiritual materialistic issue as well but it's hugely a spiritual issue of what it feels like to be a free person this is what it feels like to have a gun placed in your forehead for a lot of what you do in life David, well done but before you answer David I just want to give you a since I like you so much and because it was raining earlier but we're provoking some mad thoughts here so I think we should keep going for at least another 10 minutes but if you go longer than 10 minutes I'm going to put a gun to your head David David's going to respond we have three more people up at the microphones and we can try to go quick well in 1960 before the war on poverty 22% of Americans were poor today we've had an uptake lately but the poverty rate has generally been about 12% or 13% so in fact, you know, Iran just gave a speech about how government has created all this new poverty and oppressed the poor actually government has cut the poverty rate virtually in half over the past 40 years another major achievement particularly along the elderly as for the founders, Iran says you know if they came back today they would be horrified if they came back today they'd be like oh my god it's still beer it's still working there hasn't been with the exception of one civil war there hasn't been all sorts of disruption and chaos there hasn't been the kinds of death squads and killings and political collapses that we see elsewhere we've had an incredibly stable democracy for almost 230 years a massive success factions, some of the founders were more on the right some of them believed more in big government like Alexander Hamilton, but those factions have managed to work together, they made compromises they come up with a balance they would be extremely pleased those founders I have another question primarily for Dr. Brook about the interest in both of your opinions Dr. Brook, I'm wondering what you consider the prerequisites to be to have the capacity to make rational decisions for themselves you've mentioned repeatedly that government force, or force in general might be one of the things that removes that, the ability to make rational choice I'm wondering what you think about things like coercion and where coercion might exist from social forces I'm inspired by your mentioning of poverty things like racism or sexism to what extent do those things remove the prerequisites that are for rational choice to exist and to what extent can your sort of model help deal with those issues and is that also a role for government in addition to dealing with more direct economic or physical force thank you for that question Dr. Brook I believe that every human being you know, as long as it's well functioning grain certainly people who don't do not have that capacity that humanity has the capacity to be rational capacity and I think it's capacity that matters because I think everybody has the ability to engage it and when they do engage it reality rewards them and that's great and when they don't, reality penalizes them and that's justice I don't believe that if we live in a society in which force is extracted you know, force and force is extracted by government that these other factors are indeed coercion I don't believe sexism of course it might be an obstacle it might be a challenge but I don't think it's coercion I don't think racism is coercion unless it's done by government and it's got a gun at the end of the at the end of the coercion racism is horrible it's evil but people are racist they're irrational governments of that are rationality in my view so I don't think it's a government's job to eradicate what it views as bad ideas, I think that's very dangerous I mean we all might agree that racism is a bad idea I don't think there's anybody in the room that doesn't agree with that but there are a lot of people in this room and I'm sure a lot of people out there in the street who think my ideas are pretty dangerous and maybe even coercive because there might be some young people hearing them I don't view that as coercive anybody has the ability to say you're wrong is wrong I don't agree with that everybody has an ability to say David is wrong everybody has the ability to say those people over there who won't allow Jews into their store they're wrong and we're going to boycott that store and not go into that store any of us are not going to go into that store so I don't think that these factors I don't think corporations when they hire 5 people that is coercion those are voluntary contracts you go into it and you go out of it so none of that in my view is coercion and when we try to control it that's when you get forced that's when you get real coercion and that's when you get the destruction of liberty and the destruction of freedom and the destruction of our ability to make rational choices the certain things for example I am not able to make a rational choice about my retirement I can't decide because 15% of my income is taken from me by force I rarely use that but keep a set to something else two more questions and let's try to keep them Dr. Gellin, if you were in charge of minimum wage law, welcome to Saturday I personally think it should be 15 or 500 dollars I mean the government is there to help me you want the minimum wage to be 15 no no but do you think it should be but you are from the government to help me yes I personally think you should make it 500 dollars yes it's the minimum wage question the minimum wage question actually the minimum wage question is a good opportunity to pick up where you are on the topic of coercion this notion that the only entity that engages in coercion in American society is government I think is fundamentally wrong in fact one of the reasons why we as a society empower government to do the various things that it does is because the market has very dangerous and coercive powers that we as individuals often don't have the ability to resist it has coercive powers in the economic realm I mean this was one of the critiques of 100 years ago in large trusts and the robber barons controlled American society basically through controlling the economy through these interlocking trusts and could crush small business owners like that we came up with antitrust laws in a way to ensure more proper competition corporations and private sector have coercive powers when it comes to the labor market if there is 9% unemployment as there is today actually you don't really have a lot of choice in terms of the jobs you take especially if you don't have a college degree you may not have many choices at all you take the job that you get and if there weren't a minimum wage law what would corporations be paying today what would Walmart be paying today in the absence of a minimum wage law 9% unemployment $3 an hour $4 an hour who knows they'd pay whatever whatever they want we created the minimum wage law we created the 40 hour work week we created other basic labor protections because workers didn't have the power even with unions themselves to resist the coercive power of business and to basically be it was a modern form of slavery if you have no other options if you have to take whatever job you can that's not that much different really than slavery that is where government came along to say that employers actually have to pay a basic minimum wage they have to pay overtime if you work more than 40 hours a week these labor laws gave us the modern weekend which didn't previously exist I would put the minimum wage if the minimum wage had kept up with inflation where it had from starting in 1968 we'd have a minimum wage of about $10 an hour which would still not be enough for many workers about 30% of people who work full time are not making enough money to afford basic expenses but it would be something so yes, raise the minimum wage so 10 bucks an hour of employment would be well over 10% I can guarantee that and one of the reasons it's 9% today is because of unemployment because of minimum wage because you can't employ people who produce less than whatever minimum wage happens to be unemployment rate is 4.6% in 2007, the minimum wage hasn't changed much but this is economics 101 when you drive a crisis something up and then the Android goes down this is not science fiction this is simple 1 plus 1 equals 2 we're going to go to our final audience question and before we do I just want to say thank you to all this very engaging conversation the questions were fantastic I can't believe an hour and a half has gone by already so give yourselves a round of applause I think it was David that mentioned at one point saying well we don't expect to have a culture like that of Sweden which sparked something in my memory which is that I was shocked when I was studying 19th century history to find out that in the middle of the 19th century Sweden had a couple of growing famines and so that people were leaving Sweden as much as they couldn't I realized that's when my great-grandparents came to the United States because they would have starved if they tried to stay in Sweden and so this to me this shows that cultures can improve and can enact social changes that dramatically improve the quality of life over the long term and as much as we may not want a nanny state like that in Sweden that we can see that they've been able to improve the quality of life dramatically since the time when everybody was starving I'll just note that the comparisons of the US to Europe are getting becoming moots because more and more the difference between the two is narrowing so the percentage of GDP spent by government includes state, federal and local government between the US and Europe is shrinking dramatically so the differences are pretty small we're not hugely capitalistic and we're not hugely socialistic we're variations on the mixed economy I've mentioned this before in a previous debate I can't remember but I would offer this wager because we'll never find out what happens but I would offer to lower all immigration restrictions between the US and Sweden and see which way the population flows I'm going to give you the last word here a mixed economy works it works America has been working over the past 60 years since the advent of an activist and expanded government we've created through a lot of these policies the modern middle class that we take for granted today unfortunately a middle class which is under siege expanded access to higher education and infrastructure that allows the creation of prosperity investments government investments in basic scientific research we've seen the rise of the social safety net system so that nobody ever falls too far and we've seen interventions in the labor market to ensure that workers get a fair wage and unfortunately over the past 30 years this mixed economy which has been working so well has come under attack through the kind of principle ideological ideas that Iran has been putting at it I think that he does believe this obviously there's a lot of authenticity there but fundamentally it is attacking a system that has been working based upon an ideological animus that I think the vast majority of Americans don't actually want to get rid of social security don't want to get rid of the minimum wage don't want to get rid of the FDA don't want to get rid of the EPA don't want to get rid of OSHA that protects workers from dangerous work environments don't want to get rid of a lot of the things don't want to get rid of Pell grants that help young kids poor kids go to college don't want to get rid of our public university system don't want to start infrastructure don't want to do any of these things but that is exactly where this critique leads which is attacking the public structures that make our prosperity and well-being possible and we need to really stand up against this so thank you for so great way to end I just kind of say wow I think you covered a lot of great topics I really really want to thank our panelists up here it was a great dialogue definitely a difference in philosophy but I really enjoyed the conversation thank you guys