David Bahnsen joins the podcast today to talk about the Build Back Better bill and why its passage in the House might be at best politically meaningless for Democrats and at worst their Armageddon before we go on to discuss his book, There's No Free Lunch, about economics and human flourishing. Give a listen.
This is an unofficial transcript meant for reference. Accuracy is not guaranteed.
some guy Come to the Commentary Magazine Daily Podcast today's Friday November nineteen, twenty twenty one. I am jump out towards the editor commentary magazine with me, as always executive at a green waldheim, jump senior writer. Symbolism high Christine I can associate editor nor Rossman Heine our job and joining us today, our old friend, the head of the bonds and grew barter of the deep sea today that calm and dividend cafe bad, come those letters and the author of the new book. There is no freedom. Should we will be getting to animals David bonds and high David Warehouse,
hello! Everyone thank you for having me. the pleasure to have you you're right, you're, you're, up early on the West Coast and then probably of eleven live in the life. Unlike some us, although even I were honoured to attend the Book Party, for there is no free lunch here in New York last weekend, He had several delicious day, coax him a seem to be And in an enjoying Leah, join the martinis and it was a very lively and the M M M fun event and more so Riddick them that a person who has written a daily work than that, They tend to be something of a daily devotional dedicated to free enterprise. One would have thought that this would have been a more sober, more sober, But many people were enjoying the grape. I would say at your party why
I assure you that the author of the book was not enjoying the grape, and so I suppose, if there is no free lunch to me as well, about free blues for everybody else, but there wasn't there. So. She ended with the bar tabs. I will very judged about my martinis now about what you're martinis you were you or I will. I will say that it was a really startling thing to be in a room of people again with people and their cops like one of the things one hasn't seen in the last couple of years is kind of like the elementary experience of being at a party where some people are like, I realize is thy love you. I love you so much like had left me with one of those people of obviously have, but just as there is pent up demand that chasing too few goods there is pent up the man for having experiences that our lubricated bye, bye from
patient. So anyway, I think I'd run. I strongly suspect that the people who have felt that pent up demand- finding other ways to meet their supply, need throughout the pandemic. So we heard and, of course the the role of relaxation man, the ability to order such goods where by male, I'm sure, contributed heartily to their to their enjoyment anyway, to move on so more pressing matters are where more immediate matters. I guess, as we are beekeeping has arisen. Is is preparing to vote on the build back, better bill, which appears now, we now have settled on a price tag, In the media of around two trillion dollars, I want to repeat number two trillion dollars because couple weeks ago, excuse me a couple weeks ago.
Somehow it mystically become one point: seven, five trillion dollars and now apparently it's two trillion dollars. Everybody will remember. I hope that since March cellular Joe Mansion was a course voting on this version of the belt, as this is only the house said he's not willing to go above above one point: five trillion. the house built two trillion so now quickly. What there doing Khazar apparently passing a bill that will die in the Senate, which is, I guess, what a lot of us expect anyway by its an interesting politics, because there's gonna be this vote M and it's actually maybe fundamentally going to be meaningless, except laying the groundwork for the republican campaign against Democrats and twenty twenty two, which shares a very convenient they ve been handed a convenient set of love of of power.
see issues the Bacon attack Democrats on for their feckless. Listen, then, the exuberant spending and all that, speaking of lubrication, you need together the congressional Budget Office as yes, please last night, which produced in other broke the log jam as it were. So this but it has been working on the bill back better Bill and it came back with the time lines which is we should start with that. Will over the course of a decade, three hundred the sixty seven billion dollars to the deficit? Now that's a lot, but it's not cosmic, a lot which seems to be all that anybody cares about. It needs to be monumental, bending a monumental deficits. In order to to talk to me, anything. You know historic and that's all anybody wants something historic. What happened here, however, is that the White House says it the affair The overall see the cost estimate came about fifty billion dollars.
Below their estimates there estimates, but that was good cause. Even more and when you think about all the revenue that it's gonna generate, then you know it is. Its total totally sensible- it's not so profligate that its I found the sensibilities, moderates and one by one. Moderates in the house fell in wine last night and will be voting for this today. All this is gimmickry. I don't think he's gonna satisfy these. The more reticent members of the Senate and including John Major, who haven't said anything but kissed and Cinema, has said that she is. You know her position hasn't changed and she said Jude, making some very sceptical noises The gimmick here is that the red, there is going to be produced on the backup. Taxes are going to rise, and eventually we had the IRA is gonna. Get all this new money is going to hunt down tax cheats, we're gonna get like four hundred billion dollars at attacks sheets. Nobody knows how much money the IRS is not collecting, by definition,
because they don't know what people are paying in taxes, that's the point of this. You can actually game out that revenue. You can't, The tax revenue, but again, this is way down the line. Ten years down the line and all the spending as front loading, so they spend nearly eight hundred billion dollars right up front. That's the deficit. its eight hundred billion, is not three hundred and sixty whatever billions, and then eventually we start to pare that back with new taxes, new revenue, new iris enforcement, most of which will be forthcoming. So if you're even remotely sceptical about deficit spending. This thing should be raising a lot of eyebrows in its David you your your business, your entire professional model deals with the interplay PA six of policy and all of that- and so I am struck by the fact that the that we have a report on a bill, adding there's. No, Three hundred and seventy billion dollars to the deficit, which probably higher anyway,.
of real, I'm sure attire. But but I mean it's higher, it will be. There will be some inundations over the course of the next couple weeks and make it clear that attire and then there is this whole mysterious coat. Question about how much the Irish can collect. More than collecting now by hiring a whole bunch of agents to audit a whole bunch of people and them then been enforced things better to the tomb According to the Biden, people of hundreds of billions of dollars, which seems preposterous, I mean you could say that about anything at any time that in theory you can hire million auditors and then they could get a trillion dollars back. I suppose, if we develop, if the logic is that each auditor can generate, you know five times as income, his eye is salary him in What he, what he audits, are something anyway.
As as somebody who who who looks at these things, I mean the notion that you could take a bill say that it costs threaten seventy billion dollars and because of the madness of the last ten years. People don't go. What did you just say to me? A three hundred and seventy billion dollar increase in the federal deficit. Are you insane is this It means the interesting you know I went back and I was looking cause. I owe a couple years ago is gonna write a book about the year nineteen. Seventy nine said spending was a huge issue with nineteen. Seventy nine I mean there were give out it was. It was like one of those King points that you know drove every people knew that you know the federal. was in nineteen, seventy, nine billion dollars and air
remember, the big criticism of supply side economics was not class. Envy tax reduction, marginal tax rate reduction, the big concern on supply side was the impact deficits. There was sort of this by partisan concern that tax cuts would enhance deficit spending. That was the big evil. So I think that
in a period of time where, where the comma goes, where the decimal goes, the number of zeros on the right side, those things kind of don't matter, and yet of course they they add Dino exponential math too, to the problem. I do believe that there is a problem of people, not appreciating the difference between the national debt and annual budget deficits. I think that there is this confusion that causes people to just say. Well, it all sounds bad, but the world still turning so whatever I do think in this case it was very clear. This is generally the case. This
The issue was not economic. It was not mathematical. The anticipation, the superior and c b o numbers was political. It was whether or not it would give political cover, two people to either vote for it or give them covered two, not vote for it and I kind of thing the number came in and the worst possible spot where I think no is right if it had come in and actually honestly collected eight hundred billion. That gave a lot of cover two, probably thirty house Democrats to not vote for it, but it's three hundred and sixty seven and sort of this little spot where people can shrug it off and obviously no already said it. This issue about IRS collection,
is tat a logical absurd. How do you know what you are not collecting unless you could be collecting it and if you could be collecting it? Why aren't you collecting it so patently absurd, if I were score, yet I'd put it as a negative, I'm assuming that some people out there that are paying more than they should be another, that Boeing we funds throughout this whole process. That's the way I look at it. It's just ridiculous. There is also the messaging problem of the irish component of this bill, which is always struck kind of the average American is sort of alarming this idea of yet this is a great idea when we're all worried about a lot of major issues and were in the middle of getting out of a pandemic, let's emboldened the IRS even more to start digging into people's denote the personal business, and I think that that I mean this bill is shaping up to be a situation where the Democrats are putting themselves on the back for giving huge tax breaks for the extremely wealthy does that they will
the wealthy will get a lot of tax breaks out of all of this, and then you know Equally, throwing money at people who already rely considerably on public assistance and what not into their becoming this party, where the vast middle, which they need to win back to some extent, is being told not not even engaged but told. This is all for the benefit of society and you just have to go along at the same time that the messaging is based on class warfare because the messaging is, if you don't, two embolden. A more are flyer, as you just one war, millionaires and billionaires to get away with not paying their taxes right, but let's start with the millionaires millionaires, because. The twenty seven team, revocation or limitation on these state and local tax deduction right, which was after what ten thousand dollars, some like that
Was used to offset tax cuts bookings pass the salt. limitation to pay for capital gains? its cuts and a reduction in the there were no red the capital gains tax, because our I'm sorry, I apologize corporate corporate tax That's an a reduction in the hot and the top tax rate and to offer that those costs they limited salt now. The logic of this bill. Not the Democrats wouldn't want to go back on them on the other stuff is your store. The salt deduction. But the other to remain in place. John, because the lowered the lower the lower top tax rate and the corporate tax That's remain in place, so it's the big
windfall for Thee Republican Business class. In the history of any thing this bill, by restoring the salt deduction, which of course also obviously it affects voters in California, in New Jersey, New York, Connecticut primary Lee and those are of course democratic states right, but of the rich people, know states. There were its fascinating. What I'm here, if you think about it, because it's got a terrifying. From my perspective. As I remember I'm fine, I don't care, I'm fine with it. I'm fine that, by the way is also, I will benefit from the top
Right now I mean, as well as a flood, sucking conservative, I kind of actually like tax cuts for the wealthy in part, because it produces more capital that you can be in a dedicated, valuable goods and services, and that generates economic activity. While I was taught you know that the horrors of top down- you know economics, but now we have four publicans against this programme, because it doesn't it benefits them. Should the expensive births per we must assume the expensive people farther down the economic ladder and Democrats now going to the mattresses for a task for the rich indicative of a profound poet. Colleagues realignment that's ongoing from the bottom up, but if Democrats become the already of tax cuts for the rich as well. As various feet, social sensibilities and you can see themselves yourself, marginalizing in a way that I don't I don't
and they fully internalized, but no, I do think it is fair to say that the Republicans who favour the salt deduction, as I do so, I'm one of these people that my taxes went up dramatically, not a little bit about lot. With the Trump tax cuts, and yet I overwhelmingly favour getting rid of the salt deduction. It's not because I feel I am opposed to tax cuts for the rich. It's because I am opposed to tax increases for one state at the expense of another Anne and that's the nuances being lost on the right here. There now jumping in to the class war. rabbit as they should it's a great political opportunity and the person that is allied with the right on this is Bernie. Sanders he's been more cogent in what they're doing politically abide. By doing this, I dont think the survives
Senate side. That's another! One of these tension points there all going into it, where people have drawn lines that simple someone just gonna have to embarrassingly cave, or this bill is not going to happen. Now is burnt, Bernie has flat out said he will. Not support this in this regard, and I dont know how to get around the David. You remind me of their republican talking point around the writ. The elimination of the reduction of the skull cap was that this is gonna finally convince blue state voters to go, go you know after their local taxes, after property taxes after their state level, income taxes are finally going to have a revolt in the blue states against their own tax regimes. That didn't happen, but I don't think I think it was that there either gonna revolt or they're gonna leave, and I think that did happen. I think the actions to low tax red states has been part be exacerbated by them.
action assault, I mean I'm sure, that's true, and it is very interesting argument that you know really didn't get belgian. Has it's too complicated about whether or not sorted out represented a kind of federal subsidy of high tax states because it will live in it the pain of of of state local taxes, pretty early on the professional class that might actually gather to lobby against it. I mean it's a funny thinkers David from actually made about a good crack about this. The other day, which is that, the elimination of the salt production while keeping you know what, while the other, that taxes were caught in a major looked like it benefits hedge funds, measures against orthodontist and
You know, people who run large landscape businesses and the word the return of the salt deduction? Is their revenge like their, thereby there I'm back what they they need. If you work in New Jersey and you make hundred thousand dollars a year. You won't have you know you, you may find it adds value year running of gardening business like you lost, you have a huge tax increase and now they're getting theirs back, whereas the corporate tax cut didn't, do them any good. So it's fun I just think of it as a matter of logic, what we see with the reduction in the small tax nor the she's been beyond the limitation of the deduction four percent local taxes, is something that we talk about all the time, which is that the tax code, when the as yet echo was used in the post war era too. Africa of national expression for national gulls like home motor.
Chip is a good. Therefore, we should have a hot. We should have a united stand attack, that action on the mortgage interest for homes tube to stimulate home, purchasing make people owners and all of that and the one this sort of effective. The fact that which also lead inexorably to the financial meltdown of two thousand and eight is now in arguable, but just get rid of it in the middle, I mean that that's the point one. It's like they're. All these taxes that were put in place that ended up having tax decisions having these horrible long term, the queen of the biggest one. I think I think everybody agrees was Asking the deduction for healthcare expenses to the company, gives you insurance as opposed to it's going to? U individually, is the taxpayer being admitted. thereby accompany idle
anybody in the world who studies health care who thinks this decision was happened, you know in the post, really immediate aftermath Roma to wasn't a disastrous mistake, but it's not the worst thing it with a snap of your legislative fingers is all but impossible. The entire american economy has been structured, a redwood dealing This reality and you can't just eliminated, after transition. You have to have this. You have to do that. You blah blah blah blah and that would serve the same with salt in some ways like it's good, that its limited in some ways you would have to them deal with the other car look what you say. ok, you know what now your state is gonna have to go. Or it state local taxes, so that you don't have a big taxing You will find it can't be done in a year, even if they
honor to even if you had a power, but you know we're move or revolt, a taxpayer revolt that led to the kind of things that you want to happen the state level. Those changes can happen in the same way. You can just era We pass a limitation and the deduction these are complicated. Matters What's it like gum, like doing brain surgery like you can't just cut, you feel like you're, cut something and then and then you'll see some other part of the brain will be effected anyway. That's my what? Why would they? It is very interesting to point out for those who been following their own internal debate on this salt deduction. Is that the big compromise that I think would have been politically potent? Is They had brought a higher level, assaulted action back, but limited it to income levels, and they were one point talking about four hundred thousand another point, even going up to a million and two things
What happened to that are very interesting. First of all, the Democrats that are demanding there is restoration, assaulted action be in this bill were satisfied with it. They wanted on no cap on income level, but number q. If they had done it, it wouldn't a move. The needle there are basically was no we'll financial impact on loss of salt deduction for people in between four hundred and seven hundred thousand, where it became a very big deal, was exclusively in the pretty much well under the seven figure income levels, and so as they were scoring it, they kind of and I have to admit that the salt deduction lost the Trump past was a tax increase only on rich people, and that that talking point it needed to be eliminated, so they and reinforced it the other way. So, anyway,
we're having this conversation about, like the angels dancing on the head of a pin. I don't see any indication from what is happened in the last two days with salt with the seabed. Swimming or anything like that that this bill isn't dead anyway, whatever the house does it's dead Two five hundred billion dollars more than Manson, once Cinema doesn't like. If Sanders doesn't like the salt abduction there's all this stuff in the house is there to satisfy house progresses, it's not it's. It's not gonna be law. a big house today likely to be law, but that means it's messaging bill as as Noah has been saying over and over again, and the weird thing about that is: they act
We think this is the right message me. That's the part that baffling to me, I mean every every signalled I've been getting from the american people is that we have no, no, not at all, stop stop combat like this is not what we are concerned about and they have steam rolled along, and I think you know whatever happens with the mid term elections. They will have only themselves to blame. If this is the message, I think he's gonna resonate right now than we could ask a question of if its image on belong, I grades not what actually was the purpose of happen. Marthy marathon speech, ok, so Kevin Mccarthy. People, though no spoke last night from Thursday night into Friday morning for eight hours and thirteen minutes it had two purposes, one of which was he wanted to. The speech longer than the speech Nancy blows it gave in immigration and twenty eighteen, which was eight hours in two minutes. with you hear democratic yelling and screaming about how Kevin Mccarthy, just you know, blow Viet afraid hours. He didn't he didn't.
The fire. This was a this was a long held grudge, the pillows made them all sit there for eight hours. While she spoke about immigration, so he was gonna, make them said all night and listened Talk about bill back together. You know that that that that was answer. That's a weird heavy little internal house game that got played the other part is the I didn't really listen to the speech, but I gather that will look at it is that it was the way the Mccarthy was laying down the markers for the Republican Parker somewhat. They were gonna say against it because he went through But systematically ready, so I'm gonna talk about every section of this two thousand page bill and show you why every single thing alive, it's bad. So by doing that, my son, you know collating all that evidence in information he created road map for the attack.
A wooden them more effectively, I mean like yeah, ok, agree, I mean it's a guy, don't necessarily see the strategy, thereby wooden more effective. One had bidden to just allow them to pass this thing literally at midnight, I mean- isn't that the better talking point. Look I hold no brief for Kevin Mccarthy said: don't don't make me don't make me threaded defend his actions. I think he's not good at this job and the Amazon behaves or some behave of a kind of a disgrace. I'm not I'm, not, I'm not here to say anything. Nice have a car, they just explaining what I think he thought he was thought he was doing, and also sticking it to the moderates, who are going to k, but you said I'm in that week. We know that there's at least one moderate, there's one house moderate Democrat Golden of Maine. It was going to vote against it and remember Get forty vote against head then it dies, but
assume that they're not gonna get those four which is actually why the salt thing is there like, in fact the moderate, but the moderate blackmail worked and we think policy Policy personally want salt, and I guess her district wouldn't mind saw. But but you know, I mean I don't think they would have wanted there. I mean that that that direction is there to get just got home of New Jersey and you know very seven or eight different. Accredits, who would otherwise have sensibly voted against the bill to vote for it because it has the bloody that they want. It's the ultimate earmark and they got it. so they have to vote for it. Even though, even though they probably know it's not gonna be law, but they can go back to some say I thought I thought I got this. I got that progress is to agree
to making sure that this incredible and justice being done to you- and you know or ass ten New Jersey? I don't even know we're gonna timers distances to sell his in New Jersey, five, which is the very upper part of the state, going all the way from Brazil and alpine eggs? Yes, so Alpine New Jersey, where, where they're gonna were wrappers and do you know, celebrities live like I fought for you. You now said that is just one part of his district. Glad at district is by no means ass light, but anyway, I'm just saying so he got what on it, and then they therefore getting the moderates tempted to vote for it? I guess. Am I crazy, though? Do you see David? I mean you're, not at your, not a political prognosticator, but you follow us both these anybody, I mean, do you see any way, shape or form that what's passing the house hear something that mansion is going to gives going to say all right? You know they trimmed it
I mean I just don't don't see how you know it's only one vote killed the paternal. Now I dont see call mansions in a book worth and I don't see how Bernie Sanders is going to vote for it. The in a lot of ways. The house is done something fascinating, cuz they've, given a bill back to the Senate, that both the moderates in the progressives are going to have to to chew up a little bit the bigger I suspected, then what happens? Is the Senate does a Passing a bill and that where the rubber meets the road is what the house will deal with the Senate real struck bill because I think that's effectively, gonna be an entirely different bill and an eye I don't know how to get it done by end of the year and again, a part
I really monumental cave, which is entirely possible- I wouldn't predict who will cave, but apart from a cave it just simply can't get done. So I'm I'm still in that kind of fifty slash fifty camp, where I think a lot of you have been that they're open and I did they do not get a better build back, better built, I'm a bog done at at all. I think that's entirely possible. I'm used to describe the process here for people who are not giving up on it. So the Senate, obliged to pass the house bill. In fact, it's very rare that what happens is there's a house bill past the house. The Senate passes its own, version of the same bill, but is not it is not the same. I mean in large measure it dazzled. Out of the same stuff. But it is a slightly different bill.
and then there was a process called reconciliation that budget reconciliation, but where the bills were people from the house and people from the Senate negotiate over the final language that attempts to harmonise the two bills and balls things being amended things being cut out lengthening the times of certain types of spending all that stuff, at which point the that has to be voted on again by the house and by the Senate at that point that the vote is on the same bill. It. Presumably if it as the house and sending them goes to the president for signature. So this is up one of a five step process, the houseboats said it votes. There is a reconciliation process that produces a harmonised bill and then the house votes, and then the Senate votes again then the president's actually six steps. So this is actually step one on a stick step.
That will be could be interfered with at step too. where there is no Senate bill because mansion Sanders cannot agree on the bill, Like mansion and Sanders can agree that may be solved should be removed from it. Which will then eliminate the salt expense but SAM. will want X, Y Museum Mansion wont. In any case, if you eliminate the solid, spends the bill goes back to the house and no longer has the salt expense in it. Then the moderate vote against the moderates in the house. but against the bill? Why would they vote for it so where you sly said we're going into this bizarre moment where the house will celebrate its passage of this bill. That is, there the on on arrival in the Senate, except if its image,
politely different version that will then not be acceptable to the house anyway and may not be capital to the Senate, like I don't know how you write the bill that the Senate's going to pass so that it goes out into two thousand and twenty two at which point we're deep into the mid term. Cycle and all the psychological pressures that are going to be on Democrats. If the generic ballot, a question is to produce new double digit republican advantages and then You know you have object. Panic overtaking though the progressive commentary, yet, which dominates centre left media. All of them are gonna, be saying that we're gonna lose horribly. If you dont pass this, it's not going to pass, and then we get something akin to the bloody frederick idle conflict within the Democratic Party rather than actually positioning, the party is political alternative to republican obstructionism, but but I have a question about that: no idea,
I think you're right that media will be staying and there may be some true believers in the far left in the Congress who believe if we don't pass something we face this electoral disaster. But don't you think that there are also some who know the opposite to be true, that if they do who pass it they face toward the so sure gap or how many divisions today have there are there any levers of power to command within within the press within centre left media, but I'm from the votes yeah. What are they matter? what he's genuine JANET, genuinely look at the twenty twenty one outcomes cuts that the that sort of existential crisis that was imposed on Democrats lasted all of what forty eight hours convince themselves at all they have to do to avoid a nightmare is the exact same thing I ve been doing for the last year it having here
parking high level that would till they convince himself I'm only referring to three or four or eight honest and an astute house. Democrats who know the opposite to be the case or or even one senator, who knows the opposite to be a case. I dont think them. I think Twenty percent right on what the media narrative will be, but I'm saying factually, I think, there are some who know that they are worse off electronically passing this, then, if they don't I mean look up. The situation is that you have an interesting Marjorie, Margolis residents, key problem next year. The problem is this, which is that we go into twenty twenty two. The bill Campi Campi finished until twenty twenty two. That point it looks like it's Armageddon, no matter what right
We have fifteen democratic retirements from the house. That's can accelerate after Thanksgiving is my guess, particularly if one or two more generic Paul's that show Democrats being slaughtered. So they're gonna lose. like all these by moderates- we're gonna lose their lives, they may not run or that they were already like reconcile themselves to incredibly tough, either way, if they vote for it, there nailed if they don't, both for their blame for it anyway, even if it doesn't pass whatever it is Therefore they might have a weird incentive to pass it on the grounds that they will at least pass it because they're trying to be part of a historic, democratic effort to make the call better and to save the vice president was the story with a Lama care. It was also the story of the bombing care. The Democrats at two hundred and fifty eight members in the house and in your Philip president, filibuster perpetrating the Senate right, but what up my
point the point that I'm trying to make here is that you could have these nine or ten moderates who were alike but we're Friday. The way so do we vote against it, because we really do. We realise that we genuinely don't like it and we think that is a disaster for the party and for the country, and we are going stand the sward. It it's not really something that the do stand, sort things yelling stop right, that's what we do not then or today, Where did they vote for it? Because it's like, while we're democrats- and you know all things being equal sure, we'd one is much spending as possible. We are just in these districts that made it impossible for us to really advocated for it, but we're we're toast anyway, and if we vote for it we will get an ambassadorship to Liechtenstein. You know I mean you know by buying, will take care of us will get what he wants. So we don't really
how about that. We don't know what happens in the house which still comes down yet again to Mantua Cinema permitted. That that's where we are, the house is not gonna save America from the building better Bill House Moderates American, save America from them back better built. Only mansion cinema gonna save America from the bill by better bill. One or the other is my view it doesn't even matter so what happened there doesn't matter. Why? they would shift gears. That's the question all the time there would tell you that they will say now They will go with some people predicting this mansion and send them a cave, and I think that's what a few of my friends Nationalreview think is going to happen, and I was thinking about that. How could you have a worse broke outcome for yourself than the cave. At this point I give mansion caved and everyone who likes that he's holding
round. Moderates blue dog. Obviously you know folks on on the right there. They're gonna hate him, but then It really can endure himself to the left again like. Are they all of a sudden, gonna say? Well yeah, you put us through hell for eight months, but you came around so we like you, I mean I think Mansion Cinema have politically absolutely no benefit with the left by caving. At this point they are persona non grata for ever in that party, and at this point their best political fortunes combined with what you're forecasting that the day they are best to hold the wine and help killed this bill.
it is interesting to cinema. Just gave a big sit down interview with washing imposed, and she says I mean everything. She says that interview reinforces your point David. I mean she's like no one's gonna. Tell me what to do her. Independence is her brand people in Arizona clearly like it, what it there's nothing in it for her, especially the center, I mean there's, but she doesn't need that she's already got a politically she's got back up at home. And she won't be target by Republicans Africa. I saw, but it was something along the lines of members of the Senate Republican Conference, saying that they didn't next, The parties to really vigorously challenge her for her real act either way: she's not up for reelection, fell by twenty twenty four anyway, so the whole the hall old situation is preposterous. She is not at risk in the end in the next election cycle, and it this bill will pass the idea if she will be held accountable for her vote three years
before you know her. In twenty twenty four, particularly if. Those very suburban people, like Arizona Arizona is a state that is seventy percent supper. I mean it's not even urban. It's like seven percent Maricopa County- is mostly a suburb. It's like seventy percent of the votes like that is the vote that will Ok at cinnamon, say you know she she's she's, independent doing what we think is necessary, since the Democrats is that too much of a Democrat she'll do things ever bubble like if she thinks their best for the state like? That is a fact. Ass. The bland,
she's also by the way, redeeming genetics politicians because she's not unlike PETE Buddha judge in the horrible better, like she's, actually real genetics personality like everything about how she postures politically, which, as a journalist or I just appreciate at a personal level, so that that Corky nets- I love it with area. We should we should we should. We should go into that more of another time before we do that. When we talk about born and bred sheets, we spend one third of our lives and bed pure organic sheets from Bowen Branch Mega, truly special gift. Hizbollah branch makes the highs sheets by doing the right way, not the easy way husband and wife Dream Scott Missy talent, founded Bowen Branch to create a new standard and betting by doing things that way and there your him sheets are there all time best seller, their beloved, for so many reasons like how they get softer with every single washer. You find that now at now that you ve had them you're gettin, softer well having had the opportunity to wash them get they ve been replaced briefly, but one thing:
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Many people who already instinctively believe a lot of the right things about economic conclusions, in other words, I'm fine more and more people who have an impulse towards a free market orientation there's something intuitive about the risk reward basis of free enterprise, the allocation of resources they find to be more efficient in this
the stem there's a sort of a political alignment today that makes sense for a lot of people, but I dont think its ever been particularly intellectualize. They dont think its ever been necessary foundation. Lies in this book is intending to highlight the first principles that I think caused me to become a relentless advocate of a free society and, of course, as a person a face, it was incredibly important to me that the judeo Christian ethic sit at the foundation of free enterprise in contrary declaration of the biggest defensively enterprise we see today, which is mostly from secular rationalist, and I think that
Creating a big part of the problem that young people, if they are at any point defenders are Pfanner prize, are almost always randian and I do not think that is a sustainable multi generational platform for free enterprise. The last it's why I think lately the progressives have been winning the argument with younger people. So I wanted to do a few different things and yet so much of what needed to be said is already been said. So I extracted from the masters of old various economist at a written things that I think need to be reaffirmed and then added my own. Kathy commentary two two hundred and fifty such declarations. So can you give us an example of you know? a page from your devotional like what what what like, what what are some of your favorite truths here
you, don't like every one of them as their truth. We should like them whether their inconvenient or unpleasant or not, but I'm is hard because I'm getting ask that question in a lot of interviews and I'm changing my answer at each good changed it because you have two hundred and fifty answer is true, but I think that people then go to the books website and look at more than one interview, we're going to find me contradicting myself on my favorite but of course, as possible. My favorite this changes day by day. What I want is fanatically, my we are definitely those that reinforce free enterprise and any in any way whoever you can onyx as something that ought to be towards the aim of human flourishing on the notion that he can onyx is supposed to be a mathematical or scientific exercise, is, is effectively why people have turned into such a technocratic discipline. I do see it as the ultimate social science innocence of it being the study of human action.
that practically all of economics has largely been lost even by many on the right and so there's a whole lot of quotes from people. I gave him a costly obviously looted armies famously coin the phrase human action, but, but I think even people like my dear friend, Father Roberts, Eureka, who I was just with the accidents, do the other night celebrating his retirement. There are groups now that are really focused on this anthropology of free enterprise rooting it as If we study a man an and for me that being studied, and in the garden him being created by God, as a creature of rate innovative, productive and creative capacity. So there's a number of true sums, highlighted in the book on that theme. Those probably enemy me more than anything else, but then by the
I get to higher on the knowledge problem, I'm totally sidetracked again. So there's a lot of nuggets. There. human flourishing is it is it is it is. It is a term. That time, I think, is increasingly important can I do. I do feel like we are now finding per part politics or moral politics in dove contest over this very idea that, if the pump serve society. Politics are, our system is to allow people is to remove barriers to human flourishing, sir that individuals are find themselves in. A position to the most of what God gave them whatever that might be. that is. One
That is one view of what the purpose of our politics should be. The other view of the purpose of our politics is that is there to relieve suffering and provide a basic life for everyone and two Equalize outcomes to the extent possible so that, rather than individuals flourishing, which obviously can happen at different weights, different levels and in different ways, people end up at the same place. human flourishing itself I'll be glad, I would just argue that they, don't you end up in the same place, that if the alleviation of suffering is equated with human, flourishing and suffering is defined,
is merely the delivery of a material need which is not my definition of human flourishing. Then that can be used as a slippery slope towards all types of central planning. Now I agree I was actually saying my view is that that that the left side The political ledger is now increasingly rather than trying to create the conditions under which individuals are free to flourish that they were create a mass right to living certain basic level that everybody should be at and that if who are too high of above that level. You are who are gaining unequally and if you are too, if you are below that level, you need to be lifted up through sergeant s means to maintain you at that level in part by down the people using the means from the people who
I find themselves far above it, and that, as opposed to the question of whether were organised around saying our purpose as creatures and guy its image is too is to take the better of what God has given us all individually and MAX why's that, as part of a tribute to God's creation, let's say- and that view is now that view is deemed by many people, the one that I just described as as as as evil big It creates inequalities of outcome. What I think their view, is more consistent with marxist materialism that at the end of the day, on their historical materialism I urge them to believe that the human need being met. Their basic level is sufficient is adequate. Is the policy aim? I think it requires an answer
how would like the one I write about the book to define for rushing with a spiritual dimension and existential dimension and if you cannot make life, is merely one part of the whole orbit of flourishing. I define it for the high school students that I'm teaching you can homage to the semester is the spiritual and material peace abundance harmony, harmony enjoy, that is the goal of human activity, now be dangerous definition, for I think many modern adherence to leftism to hold to, because it would require them to have a very diminish role of the state in public life and so the free society, the free and virtuous society that I envision in in brookie and tradition. I believe, requires us to have our definitions,
and the definitions of economics, of an economy and of human flourishing are all wrongly defined by progressives and, unfortunately, are becoming oftentimes defined rights wrongly by some on the right, and so the book does have various subtle corrections. To some of these. Means taking place within a realism with populism and so forth. Can can I ask you I think that I agree with your perspective and in particular the point about it that we can just offer economy now based answers to what are in fact kind of questions of meaning and purpose. and the right has tended to try to do that. But what he? How would you respond? What is the sort of free enterprise and more the ecumenical answer to people who say look human nature shows that people will give up freedom for comfort and convenience. We know this, we washes do it all the time lately they ve So, given up freedom for
safety or a sense of safety, the pen but being in being an example of that. So my question is what is just sort of free enterprise response to that deeply embedded? part of human nature, when the state itself is also encouraging a certain approach to safety in comfort and actively some cases trying to limit freedom. Why dont think that there is an answer apart from the evolving, is probably the contemporary, whose written most eloquently about this and again. I think this is very much in the burka and tradition. We have to inform the moral sensibilities there has to be a moral education, restoration mediating institutions, because fundamentally this to me, is the story going all the way back to the people wanting a king in for Samuel the temptation
terrorism is always messianic. It has always been a desired. Replace self government, with with statism I don't think that that is just an economic challenge. It is a political one but bottle and of course, is one that is rooted in his other cultural and even spiritual maladies. But I think that the incentive structure of economics that free enterprise represents is not mere one that we can tempt people with you get a better quality of life. If you give up a little safety for the kind of more opportunistic risk reward structure were offering, I think it fundamentally has to be rooted in the argument for dignity and the argument for that sort of earned. Success Arthur Brooks used to talk about a lot and- and I think, you're exactly right. There are plenty of people who just aren't kempt
and we see this right now posed covert like I think. A lot of people can make more than acts by going back to work with a satisfied to make acts not working, and there is this challenge that comes out of that, because it doesn't up meeting the macro economic problems as well, and so the book taken holistically writes about the virtue and discipline in character that is necessary for enlightened free enterprise. World view to take hold in this society. Well, you know, dignity is an important word and you use the word dignity and it's very much again. an interesting challenge to the to the left, because It is missing from their diagnosis of what needs to happen for people, which is that
It is not just a fantasy to say that providing people with money that they do not earning, makes the money cheap unless meaningful to them providing for the people. You love. Gives meaning to the act of earning money. You then use to the support here. Family, your children, your loved ones. Your relatives, your community, in the form of charitable. Contributions in your own labour and all that and that that we all understand that this is a. This is something that affords you a kind of self worth because of the day Maybe you work that
You know. If you read the Thomas Picky or what you know, it is the quality that is entirely absent from contemporary left, liberal economic, Is this notion that these are people That all of this is about making sure that people are in a position to leave meaningful. Decent wives- because now that we no longer really have to work in the United States, for example, about actual starting? You know how do people leave meaningful lives and a lot of the solutions that are proffered. completely silent too, that we now spend twenty years with this horrible. You know story about the increase in suicides, the massive increase in depression, the massive increase in the use of you, no anti dumping, this this this world in which people are saying that their sole sick? They are? They are they are making,
very clear millions upon millions upon millions of people that they are experiencing sicknesses, Not the sole, because no care is being taken to Tipp teach amber, provide them with the means by which they can live, led the a dignified life. That is the answer to that kind of soul, sickness and anything up to David's point. It has nothing to do with their material welfare. These people who can get more sufficient calories into their bodies little have have tvs, and some This is cars, and you know of clothing and all the rest. What what what it used to mean to be, to me to be below the poverty level had somewhat. to do with material deprivation, and that's not even what is that
what is what we're talking about, we talk about the horror of being born America. Now I think that the idea of being a supply side economist, has to transcend the idea of lower marginal tax rates, that, for me, I believe, the production side of the economy, is not only the healthiest and sort of sin qua non of all economic activity, but it is the vehicle for this existential saw, feeding need in society for people to be able to be more productive. I can make the argument better when I rooted in the fact that they were in fact created to be productive by an incredibly produce. God and that, when we form of social organisation for society around there being to cast a people, not rich and poor, but productive and consumptive
there are some people who are just really not that good, not that productive, not that smart, not that industrious, not risk takers. They need to be taken care of by those who did get the productive gene. That is the implicit bossa fee of all left. This Deacon onyx, the some people are simply made with less dignity than others. Apparently and my belief recognising this guarantees exist in education and economic well being out of the womb, so to speak. That fundamentally, out of creation. Gods view the view that we ought to have in the way we think about economic, societal formation is that all people are capable of being productive and- and I don't think that the right has formulated its economic messaging around- that excess central message.
For quite some time, gimme a second you just talk to goes about moving parts because the best bacon the best take the best check him in the best Samuel I read, won't come from the world to restore the only find on the family, farm and cod independent alaskan, freshmen. That's why I need White box dot com. It delivers grass FED grass finished beef and lamb, pastured pork and chicken and wild caught alaskan salmon direct your door. Their animals are raised outdoors, their fish swim, wild in the ocean and willing to meet is free of antibiotics, normally sugar and all the other junk. You find pre packaged in the meat I'll sign up at Blink box, dot com commentary to get a year of ground beef for free and what makes you want delivered with your first box change. It you get it cancel any time you will
get free ground before a year. If you go and joined them wink movement today, at one box, dot com, slash commentary right now, listeners to show get free ground beef, For a year, monk was founded by my generation farmer, who is featured on shark tank hosts Kevin Larry, said it's the best bakings ever tasted Jamie silent off. Of the ring video doorbell invested in mind, so join the movement near the best ground, beef you'll ever taste, but for a limited time, spelled Emmeline K, Box, dot, com, slash commentary, that's wink box, dot, com, slash commentary, David. Couldn't let you go even though we are approaching the our market, but we can let you go without some in inflation. Talk so I do not deny as
We economic realised that the statistics show that at this present moment, inflation is right and that inflation is accorded the stats inflation up six percent year on year. What you believe is that the is that a lot of people misunderstand what is going on here and think that there is something going on in In policy terms both the passage of legislation in the behaviour of the fad that people are attributing to democratic ledges, so what you oppose and FED behaviour, which you also, I think, oppose That is not actually the car that has not actually, if you were gonna bet on the long term, circumstances you're gonna economy, betting on us, moving into an inflationary period is exactly the wrong bat and avoid misunderstanding.
of what actually giving go on over the next decade, and maybe the next generation now think that The fair summary, I would argue that my opposition to the government spending those is more fervent than those who are arguing its inflationary, because the argument don't pass this bill it's gonna make the economy too hot. Very bizarre argument, what its goal Do a sucker growth out of the future. That's would excessive. From indebtedness does- and this is not a controversial opinion and I don't think it's very disputable excessive from an indebtedness, sucks growth out of the future, that is a distant patient, airy reality overtime. If we define inflation as price escalating, we are suffering. The six point. Two is very disingenuous because
that would require people have said we had deflation a year ago, and I didn't hear anybody saying it is three point: seven percent analyzed for two years and without food and energy, its two point: six percent, but food and energy matters so that data to me, as can odd three point: seven percent for two years is going back to preach hobo levels. This is a byproduct right out of the money. Supply is higher times lower velocity, so you're getting less inflationary impact for the monetary side. But then you have prices going higher with a really dramatic collapse in the delta between demand and supply. The there's some factor today, s that are temporary and some factors that are gonna, be longer lived more,
I am convinced that the temporary nature of the supply chain issues, ex semi conductor and more convinced a longer term problem on the labour shortages. If the FED guy of all quantitative easing tomorrow, no tapering just immediately stopped all bond by and go by hot a press conference to say there will be no additional government spending it wouldn't new one bit to hire. Eighty thousand truck drivers that are needed immediately to get the country reopened forget the supply activity that is necessary to meet the delta in demand is a chain of circumstances that does not make for a very good conversation on Fox NEWS does not me. For a good tweet from republican Senator, fully supportive and you- and I have emailed about this privately fully
the board of Republicans, making all the political a out of this, they want has its going to help them. It's going to be effective, there were brought it up, last summer's on the pod cast people dont care why prices are higher. So I'm fully cognizance of the pragmatic nature of where we are in this conversation. But I am an economist, not a politician, and I cannot let the record state something the entire multi multi multi trillion dollar bond market is screaming as economically absurd, which is that we have this huge fear of long term inflation, because the present policy, we have a massive fear, Japan, if people are saving less, and that means you get less investment which mean get last productivity. Someone could break apart my algebraic expression any time they want and tell me what part is wrong. Do
get more productivity from less investment. That would be a peculiar argument, but I'll listen to it. Do you lesson about you get more investment from less savings. Now that one, I think, would be kind of hard just an identity equation: yours no investment that doesn't start with savings to technology so fundamentally, I'm saying something noncontroversial that we have a one and a half per cent. Yield on ten year government debt and basically two percent yield on thirty, your government debt and all the You have done nothing about go down as debt to GDP has gone higher, because government spending is a bad thing in excess of a capacity to serve it. We don't have the economic capacity to deal with this excessive indebtedness. Just like Europe dozen can decide. Japan doesn't
So that is the more nuanced argument. I just drove me five minutes to a on your podcast. I can't say it in thirty seconds on Fox NEWS, but I am thoroughly convinced that, economically for investors, which is my priority and those that are trying to avoid mistakes. The right made in Post war, a war too that this came out of Cato again Coke was a huge of a guy named Marie Ross barred. There was a big group out. Otherwise interesting, sensible right, an economic thought that everything thing was inflationary and it was aided by the circumstances. I can seventies that you ve talked about. So by a graphically quite a bit around the oil embargo, them Nixon, pulling us off. Standard and seventy one and all of these factors the created genuine. Commissioner realities. We say this. I know it
I am a broke, the back inflation. By raising interest rates, they raise interest rates to five percent tomorrow it doesn't do a single thing to get truck drivers back to work, Lily limits proposed to us a quick scenario because could see a nightmare scenario in every direction. For the right from what you said, which is to say the thing thank you, sir. Most injurious at present meaningly. Eighty thousand truck driver problem that can be cured overtime I may could be cured in six months. We don't know how I'm not sure I understand how but, let's just say, comin a blog and do it and then be carrying a will, be rare. Ok, so that, like in the middle of twenty twenty two, when things start to heart, sort of things start to harmonise the kind of explosive growth that everybody thought. I was gonna happen in twenty twenty one, but was into
but was interfered with, because covered were had had a more lingering effect than we expected. Actually things explode twenty twenty, two massive Egon, growth and twenty twenty two and in the inflationary, but none the less wages- may outstrip why inflationary results there are goods are being delivered, things being off loaded trucks are driving things are you know, things are just humming all long and the hairs nightmare for the right, the results, November. Two thousand and twenty two election may be bad just because of cyclical effects in the fact that people are going to blame Biden for the pain that they suffered this year. But you could look at twenty twenty four, let's say: or going into twenty twenty four. We could have a very healthy economics come stance in America that propels and transports Democrats forward hideaway.
For a little bit maybe like ninety six, a little bit for Clinton. Eighty four firm for a Reagan and then comes the deflation. That's your big you're! Looking at that, our way against the american future, and I think you think it's it's close right. It's not it's not far off while you. Let me ask you this, you said mention a six point: two percent increase in C p. I I think it's a somewhat disingenuous numbering, but as a headline it's true do you think Asian, meaning the movement higher prices from here to where they are a year. From now is gonna, be higher or lower than six point two percent I mean, let's put it this way. If its higher than six point two percent- and I mean you know- then we might all like look for you now to move to New Zealand. Wickedness inflation is, is there is positive? Inflation
add a decelerating rate of growth. That headline of three percent inflation off of what was six percent is going to be politically advantageous to Biden in my opinion, wrote an end. So what you have is I don't know if I would agree about two thousand and twenty four, because I think at that point there is going to be such a diminished return from the monetary stimulus in the economy. That is it it just in time possible to put that far out, but no, I think it's a very real risk for next year. The Democrats, by summer time want to run off of a totally different economic narrative, be the price increases that we face.
now are not all going to be cured by summer, but the rate of growth will very likely be going down. Its Anna, Sir we're gonna make people feel entirely better, but I do think that bedding all of our horses on this notion that we're getting nineteen seventies inflation, I can say, is inflation was not six months. It was basically the entire second half of the decade, combined with very underwhelming nominal gdp growth. That's where this term stagflation came from. There is very high nominal gdp growth right now and an so I, my own political feelings are how they are to your message: it s a somewhat immaterial. I'm more just saying that economically one
Term we have a real thing to talk about, which is the economic stagnation and lost opportunity and loss of growth that comes from excessive government indebtedness. Joe Biden muttered the biggest favor of his presidency from Christian Cinema, because if I'm right- which I am that the price pressures we face right now, upward price pressures are supply side driven. There is nothing they could have done worse than increase marginal tax rates on corporate income, personal income and investment income Christen Cinema took those things are now. Do I think that they are about to go past and art? Laffer tax cut a marginal rates, of course, not thou. So couple oddities inflationary pressures, real quick though, but they're not going.
do that, but they are released a voided, exacerbating that inflationary problem in a pretty profound way. Well, you know you can count. One thing you can count on Biden to do when faced with certain types of choices that will that that will either help him or harm him is that he will probably make the wrong choice based on the last eleven months. He has not to do things that are helpful to him and obviously he would if he'd do better, and so you know some of this does depend on him. Not stepping on his own recovery and I suspect that he'd he he will do that and that's part of what is missing from this. You know rank poetry, analysis of what the political consequences are economic situation will be. Eleven months amounts that they don't take into account. The fact that bite in the sitting there and will be doing things and they will have an effect now like he did,
Galveston and it's had this effect on him. You didn't have to do it. You chose to do it and he'll choose to do other things and right now you got to figure that whatever he chooses to do is going to be the wrong choice for him and for the country, and therefore, God knows what the effects of that will be eleven months from now or at eleven and have fun anyway, David Downloader by there's no free lunch. Two hundred and fifty and it's great to have you and for everybody, have a great weekend for Ayden and Christine and John Podhoretz keep the candle burning.
Transcript generated on 2021-11-19.