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Nov. 25, 2008 - Rush Limbaugh Program
35:32
November 25, 2008, Tuesday, Hour #3
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Time Text
Okay, we're back, ladies and gentlemen.
Pardon me for being a little late here.
I was having a private communication, my official Sony concierge about a delivery that's stuck on a broken airplane.
Greetings and welcome back, Rush Limbaugh and the Excellence in Broadcasting.
Would you please rise?
Would you please rise?
Thank you.
You're going to have to start getting into the habit of this.
Be seated.
Whenever I approach the EIB microphone, everybody rises.
I, Rush Limbaugh, live from the office of America's Anchorman behind the golden EIB microphone, 800-282-2882, if you want to be on the program.
By the way, folks, I read the most hilarious thing last night.
I didn't print it out and bring it in here because, well, you know, you just keep.
I'm now hearing it's going to be a negotiated item once we get unionized with card check in here.
The fact the staff's standing up when I approach the microphone.
Well, you go ahead and think that way.
You think card check's going to get in here?
We don't have enough people here to qualify.
You want to unionize.
The battle's on.
As I was saying, ladies and gentlemen, last night I was reading, I was doing show prep, and I came across the funniest thing.
I didn't print it out because it was so obviously a parody, but it reads.
I wish I had printed it out because it reads like a genuine news story.
Let me ask you a question.
Who is the one obvious person not yet named to the Obama cabinet from the Clinton administration?
Who is the one person that Obama has not yet named who was prominent in the Clinton years?
Exactly right, Monica Lewinsky.
They're bringing back every, even brought back Alice Rivlin to do consultancy.
I'm sure that Madeline Albright will be, you know, prancing around over at the State Department doing some things undercover and behind the scenes, theoretically, but figuratively under the cover.
But Lewinsky, and this little humor, this satirical story, had Monica Lewinsky being appointed to a position at the State Department for a host of valid reasons.
She has exhibited amazing oral skills, which are crucial to the acts of diplomacy.
She is very, very economic, saves everything, including her wardrobe, which would go a long way to help Obama's plan to cut budgets and so forth.
But there were other things in it.
It was just hilarious.
I still have it on my home computer.
I'll print it out and I'll bring it in tomorrow.
All right.
Barry Ritzholtz, a financial blogger, has run the numbers on the bailout.
And he cites a guy named Jim Bianco of Bianco Research who crunched inflation-adjusted numbers here and compared some previous federal government expenditures to the current total of the bailout.
Now, depending on where you look, the total bailout money today is either $6 trillion or $7.4 trillion.
These guys, they just ran it up to $4.6 trillion.
And it's more than that now.
It's at least $2 trillion more than that.
Now, the Current national debt is like $7 trillion.
I think something maybe it's higher than that.
But regardless, that's irrelevant here.
This current bailout, calculated only up to $4.6 trillion, has cost more than all of the following government expenditures combined.
Are you ready?
The Marshall Plan, the Louisiana Purchase, the race to the moon, the SNL crisis, the Korean War, the New Deal, the invasion of Iraq, the Vietnam War, and NASA.
All of those combined in inflation-adjusted dollars equal $3.92 trillion in today's dollars.
This bailout is more than all of those combined.
Now, would you like to hear the inflation-adjusted dollar amounts for each of these line items?
The Marshall Plan back when we did it cost $12.7 billion.
If we did it today, and it rebuilt Europe after World War II, for those of you who voted for Obama, if we did the Marshall Plan today, it would cost $115.3 billion.
We rebuilt Europe for $115.3 billion in today's dollars, and we have just spent, according to these guys, $4.6 trillion on bailouts of the U.S. financial industry.
The Louisiana purchase in today's dollars would cost $217 billion.
Now, for those of you who voted for Obama, the Louisiana purchase was Thomas Jefferson's.
It's how we got New Orleans and much of the territory all the way to the left coast.
And it gave us the Lewis and Clark expedition, which Jefferson ordered to go find out what the hell we just bought.
The race to the moon in today's dollars would have cost $237 billion.
That's more than the Marshall Plan and the Louisiana purchase in today's dollars.
The SNL crisis, we bailed out the SNLs and fixed that.
Today's dollars, $256 billion.
Back then, it was $153.
The Korean War, $54 billion back in the 50s.
Today's cost would be $454 billion.
The New Deal.
Today's dollars estimated to be $500 billion if we did the New Deal today.
That's half a trillion.
We have spent $4.6 trillion.
The New Deal was half a trillion in today's dollars.
We have spent $4.6 trillion and probably more than that.
At least six or seven.
The invasion of Iraq, $597 billion in today's dollars.
The Vietnam War.
Back in the era of the Vietnam War, it cost $111 billion.
To do it today would cost us $698 billion.
And NASA, this is not the race to the whole NASA budget.
Over the years, $416.7 billion.
In today's dollars, it's $851.2 billion.
Maybe this is an annual cost here for NASA.
Yeah, it's an annual $416.7.
So all of these add up to $3.92 trillion.
Marshall Plan, New Deal, Louisiana Purses, race to the moon, SNL crisis, a la and we have spent the $4.6 trillion.
The only comes close as World War II.
And even that cost less than what we have spent.
But at least in World War II, we were producing something, and everybody was working, and there was a tangible result, and that is we were able to stop David.
We were able to stop Hitler.
I mean, we did a great thing in World War II.
And again, I have to emphasize this is using a figure of $4.6 trillion as the bailout today, which is far, far more than that.
Ladies and gentlemen, in August of 2007, I was fortunate enough to be invited to the White House to have dinner with President and Mrs. Bush up in the residence.
And for two hours prior to dinner, I was taken into the treaty room in the residences down the hall from the Lincoln bedroom with President Bush and Ed Gillespie, who had replaced Karl Rove.
And the president took me around the world and told me what was going on and where, what was being done about it, what the challenges were and so forth.
No secrets were divulged.
When he got to China, he said, most interesting conversation I've ever had with Hu Zhintao, Chinese Premier.
I asked him, I said, who?
What's your biggest challenge every day when you get up?
What is your biggest challenge?
And the president told me that Hu Zhintao's answer was, I have to create 25 million new jobs a year, and I got to keep them in the countryside.
Because if those people ram my cities, I lose control over them.
I can't handle any more population in the cities.
And I remember, after having that meeting, I came back and shared some of what the president had told me.
So you may remember that story.
I have two stories.
One is from the Times of India, and it's from Beijing.
Chinese leaders have finally admitted the country is facing a grim situation on the employment front owing to the global economic crisis.
An official survey has shown that demand for labor has fallen 5.5% in the third quarter of this year across 84 different cities.
Yin Weimin, the head of the Ministry of Human Resources, said that labor discontent was a top concern of the Chikom government as the employment situation has turned grim.
The government is clearly worried that among jobless workers, unrest would result in protest demonstrations and unruly scenes, in which case they'll just pull out the tanks, but they, you know, they don't want people to see that.
The past weeks have seen strikes by taxi drivers in four cities and a workers' riot at the party headquarters in Gansu province.
China has nearly 150 million migrant workers who have left their rural homes in central and west China to work in the factories of South China.
The extent of unemployment caused in factories cutting back production following loss of export orders is still not known, but the numbers might prove to be big enough to cause social tension.
You have to love those words, social tension.
Here we got millions of people with jobs, no job, nothing.
It's a powder keg.
And they're leaving the countryside.
And here's a companion story from strategypage.com, datelined a couple days ago.
Civil unrest in China is a growing problem that the government's trying to hide.
Mobs attacking the cops or government buildings is an increasingly common event.
The news gets out via the internet, not the government-controlled media, the causes corruption in the police.
And among local government officials, these are all communists.
Most Chinese see membership in the Communist Party as a license to steal because only party members can be government officials, which includes the cops and military commanders.
The government admits that these incidents occur, but refuses to release details.
Information gets out via the internet, and that indicates an increasing boldness, apparently born of desperation, on the part of the protesters.
This indicates that many officials at the local level are not listening to the growing government pronouncements about fighting corruption.
And it goes on to the whole point of this story is that the Chikom government is facing this revolt because there is a rural rebellion.
That Hu Jintao is failing in his stated necessity to create 25 million new jobs out in the countryside.
And one of the reasons is the U.S. collapsed.
I mean, we're not importing as much because there's disposable income's down and spending all this money on nothing.
All this money is not.
Can you imagine if the U.S. consumer was spending some of this money?
And oh, well, that's a pipe dream.
Nevertheless, I just found these two stories interesting because it was just, what, 14 months ago that President Bush told me that this is the biggest challenge that Hu Zhintao, the Chikom leader, has, and here it's coming to pass.
The president said he told Hu Jintao, who you've already lost control, buddy.
You've already lost control.
I mean, you've got your police state and so forth, but you've also got people clamoring for cars and nicer homes, cheaper gasoline, and so forth and so on.
Capitalism has made its way in.
Now, I haven't lost total control, but this stuff, when the people in the rural provinces start migrating to the cities, they got big problems and it's starting to manifest itself.
We'll be back.
Thanks, Mr. Engineer, for playing this song, reminding me where my Sony order is stuck.
Here's a good song, Johnny Rivers in Memphis 1965 or 1966.
Hell, Rushbo, half my brain tied behind my back just to make it fair.
Pittsburgh and Sean.
Glad you waited, sir.
Welcome to the big program.
Thank you, Rush.
Hey, I was just telling your call screener, you know, everybody who's talking about, you know, should we bail out the consumer or bail out the big three when it comes to these cars?
I mean, why not do both?
I said, why can't you set up like a rebate system on a scale?
Like, if you have good credit, you get a $2,000 rebate that goes directly to one of the big three, whichever one you buy the car from.
If you have less credit, give them up to like a $5,000 credit.
That way, you're helping the consumer, you're encouraging them to buy a car, and you're helping the big three at the same time.
You know, you have a great idea, but you're not going far enough.
If you have a great idea, you need to go all the way.
It's just, well, no, no, stick with me on this.
It's just like this whole bailout plan.
You know, Obama, he thinks it would be very worthwhile to have 2.5 million new jobs for the government or saved for the government, people doing roads and bridges and so forth.
And he thinks this is going to be very instrumental in reviving the U.S. economy.
Well, if this is a good idea, why stop at 2.5 million new jobs?
Why not just hire every American to work for the government?
If working for the government is what brings about economic prosperity, then Obama should just hire every one of us.
And that was true.
So that's the reason why are we switching more toward a service economy?
Exactly.
Now, your idea, why go through all this rigmarole of credits and rebates and so forth?
Why not just have the government buy everybody a brand new car?
They can keep the cars they have or trade one in that they don't want because many people are multiple car families.
Just have the government buy everybody a car and look at what that would do.
You make sure that the cars are American-made.
I don't know if I agree with going that far, but I mean, if they're going to give the big three the money, why not encourage people, I'm saying do it that way, to encourage the people to actually buy the cars instead of just giving them the money and doing what they're doing with it now.
And then six months from now, after more.
Well, in order to get people to buy the cars, they're going to have to have cars people want to buy.
And that's going to be a problem because the bailout money is going to have requirements attached to it that they've got to go green.
They got to go alternative energy.
They got to go small.
They've got to build cars that a lot of people don't really want.
So basically, they're going to force them to dig the hole deeper.
I think there's an effort here to green as much of American industry as possible on the basis that we need to stop global warming and so forth and so on.
This is a dream for these people, Sean.
This is a dream for liberals who have been dying to run as much of American business as possible with all these businesses traipsing up to Washington with their hands out.
You can attach all kind of conditions you want once you hand out the money.
This is why I don't accept freebies.
I do not, I refuse.
I mean, somebody, you know, give me a piece of gum, don't misunderstand.
But I don't, I don't, I don't take, I don't, because I don't want to be obligated.
I don't want the strings that come into it.
Somebody, that's why I would never run for office.
I mean, the pay cut's the primary reason.
But the next reason I wouldn't do it is because you've got to go out there and fundraise.
And the moment you hold your hand out and you ask people for money, there is an expectation attached to it.
Now, in an ideal world, the expectation is that the person giving you the money will be satisfied if you just stay true to your ideas and your ideals and principles and do everything you can to implement them.
But a lot of people, as we all know, when they donate particularly large sums, have tangible expectations that go beyond ideas and ideals.
And that I couldn't do.
I have tried to set my life up my whole life so that I didn't need to depend on anybody, so that I didn't have to ask anybody for any because I've been through that.
I didn't want to go through it again, and I don't want to be obligated to anybody.
And there are ways of doing that.
And so that's why this bailout money is going to come with so many stipulations, you don't even want to think of it.
Doing show prep last night, and I came across so many stories that made me think that they're spoofs.
There's got to be a spoof.
I'm not reading this.
This cannot be a real news story.
And with so many internet sites out there now doing spoofs, I said, I wonder if I'm getting scammed here.
And this one turned out to be real.
It's from the South Florida Sun Sentinel.
The Florida governor, Charlie Christ, said yesterday that he is considering a holiday season moratorium on home foreclosures here in Florida, a move similar to a 90-day foreclosure ban sought by Governor Schwarzenegger in California earlier this month.
Chris told reporters at the Capitol in Tallahassee, I think it'd be a good idea to be able to do.
I want to work with the banking industry and I want to do it in a way that's not harmful to them.
And we want them to continue to succeed, to continue to loan money, but we want to stop foreclosures.
Now, can you understand why I thought that was a spoof?
We want to continue to succeed.
We want the banks to continue to succeed, and we want them to loan money, but we don't want to have foreclosures.
Excuse me.
Governor Christ is a Republican.
We want the banks to succeed.
We want the banks to continue to loan money, but we want to stop foreclosures, especially during the holidays.
Well, Kay, I don't know how you do this.
I really don't know how you have the banking industry succeed, have them to continue to loan money, but then not foreclose on the people who don't pay them back.
I don't know how you do that.
In California, Governor Schwarzenegger has asked lawmakers to enact a 90-day stay on home foreclosures similar to what President-elect Barack Obama proposed at the federal level.
Both these guys love John McCain, too.
Chris and Governor Schwarz.
I'm sorry, folks, I'm speechless.
I genuinely am speechless.
I mean, these are Republicans talking about this, and this, you know, I'm reading this, and I fight the urge to burst out laughing.
It's got to be a spoof.
This is something a liberal would say.
Well, we love the banks.
We want the banks to keep lending money.
And we want them to make money.
And we don't want them to foreclose on anybody, especially during the holidays.
Oh, okay.
Good.
Sounds like a plan.
Write it into law and sign it.
Here's Tim in Chelsea, Alabama.
Hi, Tim.
Welcome to the EIB Network.
Retired Army Ditto's Rush.
Thanks for being on AFN all those years.
Thank you, sir, very much.
The big three auto makers have an opportunity, if they grow a spine, to stump break government out of their business the same way Big Tobacco missed it 10 years ago.
10 years ago, Big Tobacco could have broken the government from bothering them by doing two things.
Just saying, we're not going to sell any cigarettes in the United States for amount of time, and we're not going to buy the tobacco from the farmers.
To protect the taxes, government would have defecated themselves, granting them immunity from those.
This is an interesting idea, I got to tell you, because it goes to the point, we've had all these people talk about a cigarette's kill, tobacco's kill, can't advertise it, can't do this, got to get Joe Camill out of there.
It's so bad, ban the product then.
It's causing health care costs to scar.
Ban the product if it's so bad.
But they won't ban the product because they won't do it out the tax revenue.
So your point is that Big Tobacco could have just said, fine, we're punting America.
Yes, sir.
And big three automakers can do something similar to get Congress out of their business by doing two things.
They could declare the bankruptcy now before they take a dime of government money to do the reorganization, and they could reincorporate as part of the reorganization in the Bahamas.
Therefore, they get rid of all the standards that apply to domestic automakers.
Yeah, well, you know, that has about as much chance of happening as big tobacco.
Well, they've got no spine.
Now, see, here's the thing, though.
Members of Congress already do this.
There's another story today.
There was a story yesterday in the New York Post about Charlie Wrangell.
You know what he's done now?
Now stick with me on this, Tim.
All right, sir.
Charlie Wrangell has declared that his home in Washington, D.C. is his primary residence.
He declared it as a homestead so he doesn't have to pay taxes there.
Well, that means he's no longer representing his district.
Right, but he also has primary residence in New York.
It may not be primary, but he declared his place that he lives in Washington to be homesteaded.
Members of Congress do not pay local D.C. taxes because their official residence is somewhere else.
He somehow got a homestead exemption in the district club.
This guy's got more apartments on a salary of $160,000, and he's got this vacation rental place down in the Dominican Republic where they catch him sleeping in the back of a hammock, which is a very interesting picture.
And Charlie Wrangel could probably serve as a consultant to advise Big Three Auto on how to restructure.
Where did you say the Bahamas?
Bahamas, Jamaica, wherever the tax breaks are the best.
Cayman.
Let's not forget the Cayman Islands offshore.
That's right.
You go over to Bermuda.
Go over there.
Now they get rid of all the requirements.
And if they need to, they don't sell autos in the U.S.
They just ship overseas to where their business is good.
Yeah, well, it's an interesting theory, but you know it'll never happen.
Oh, yes, sir.
People got to have a spine first.
Well, no, it's not even if they had the spine.
The auto business, look at all the domestic dealerships that go out of the suppliers, all of the that's part of your trick, right?
This is absolutely.
All right, you people, you want to tell me how to run the business?
I'm going to leave the country.
We're just going to shut down.
We're going to make cars in America.
And that would keep Congress would back off because they don't want to kill the cow.
I don't think, I mean, that's the theory.
I think it would make them so damn mad.
I think they'd make sure that nobody ever treated them like that again.
They'd put them in jail.
They'd do something, hold them in contempt at Congress.
They'd do something.
Well, you know, standing up for freedom is a fight.
You've got to fight the fight.
I know, but that's not what these guys in the auto business right now are looking at surviving.
And I just, you know, those are the kind of things that they're really fun to talk about, and you would love to see.
I would have loved to have seen big tobacco stick into these people.
I just would have loved.
Oh, I cannot tell you because that your product kills, then ban it.
You gracious public servants, if it kills, ban the damn stuff.
But you can't because you can't deal without the tax revenue.
You can't survive without people buying the product and killing themselves, as you say.
Hell, cigarette smokers deserve medals of honor or some congressional medal of what because they're the ones paying for health care costs right.
Well, I don't know anybody's paying for anything anymore except the bailout.
This is Peter in San Mateo, California.
Hi, Peter.
You're on the EIB network.
Nice to have you with us.
Rush, thank you for taking my call very quickly here.
The nation in World War II was actively persuaded to buy war bonds.
One of my professors from Stanford, Professor Elmer Fagan, cautioned FDR and Morgenthal that after World War II, we'd face a major inflationary period because of the debt.
Well, Morgenthal and Roosevelt argued that it doesn't make any difference how large the debt is.
We owe it to ourselves.
And Fagan argued it is crucial who owns the debt, the savings bonds.
Namely, the holders of the debt had a high propensity to spend rather than save after the war.
The result?
Inflation.
Too much money, chasing too many things, homes, cars, appliances, and furnishings.
That was a very instructive period, and it was remarkable because Fagan parted ways with Roosevelt and Morgenthal over this issue of what would happen after the war when all of this debt was going to be, all of these saving bonds were going to be redeemed, and the inflationary period we would have.
I'm not going to try and out-guess what's going to happen in the future here, but I think this was a very instructive period of how people didn't really know their economics and think it through.
Okay, well, no, tell them what give us the modern-day scenario.
What's going to happen after this?
Because there's no World War II here.
Oh, that's true.
All of these debts that are out there, all of these loans and everything, are going to have to be paid back at some point.
Who says?
Well, of course, if they want to wave a magic wand and put it aside, but this economy has just gotten upside down.
But I thought Obama's going to fix this with his infrastructure program.
Yeah, and the moon's blue, too.
Yeah, well, we've got to fix the crumbling roads, the crumbling bridges, and the crumbling schools, and the crumbling states, and the crumbling mountains.
There's a lot crumbling, and we're going to fix it.
I'm jazzed.
Okay, well, Peter, thanks for the phone call out there.
I appreciate it.
So I guess we are to expect hyperinflation after a while with all this.
Either that or a very bad deflationary cycle.
And it, mm-hmm.
Mm-hmm.
If the foreign - no, the danger of - Snerdley just asked if foreign governments are buying all this debt, don't we have to pay it back?
Theoretically, yeah, you have to pay everything back, but I called your attention to the national debt, which never gets reduced.
Every year's budget deficit gets added to the national debt.
But this, what's happening here is unprecedented, and it has never happened before.
There isn't the money to pay it back.
There's not going to be the money to even service annual debt payments.
We're going to have an annual budget deficit of $1.3 trillion, maybe more, in one fiscal year.
A budget deficit.
Well, that's not, they're going to continue to buy the debt, but they're not buying the debt in order to get it back.
At some point, I mean, maybe, but it's just like the federal government is telling Big Three Auto, you want the money, here's what you got to do for it.
The big danger here in having all this foreign debt owned by the CHICOMs is the leverage they hold and the whatever other foreign countries.
It's the policy leverage that they hold, and it is the threat of calling the debt.
It's the threat, okay, we need the money.
You give us the money, the threat that that's always hanging over you.
When you deal with loan sharks, deal with loan sharks.
Now, one of the reasons all these countries have been buying foreign debt is because we've been the economic leader of the world, and they've had an interest in our economy being strong and so forth, even while they compete with us.
It's a little bit more complicated than all this.
But look, folks, pay this back?
Pay it back?
Wait till you see what's going to happen to the federal budget once we start nationalizing health care, once we start raising taxes on, pay it back.
Arguably, there won't be paying anything.
I just saw that the Citibank deal, the government's taking an ownership stake in Citibank now.
So they're taking an ownership.
They're going to be taking an ownership.
Barney Frank wants to own 80% of the auto industry.
And while this hasn't been stated, it wouldn't surprise me if someday, if that ever happened, for example, that he would suggest in giving the union, let the federal government just give the ownership of the auto industry to the unions.
Anyway, quick timeout.
I'm long in this segment.
Got to take a brief timeout.
Be back.
Snurdley reminded me of something earlier, and it's true.
This time I went to New York and I did not get sick.
Zycam, baby, Zycam.
I used it on the way up.
I've started using it as a preventative now.
I've started using it.
I mean, the instructions say you're not supposed to do it.
Well, that you should do it when the first sign of getting a cold.
And I've started using it preventatively.
I mean, not every day until, but when I want to be in an airplane or be in an environment with a lot of germs and people running around, I start using it preventatively.
And I didn't, this is, usually I do get some sort of disease up there.
Zycam saves the day.
It really does work.
That's the greatest thing that you can say about any product and recommending it.
It works.
Z-I-C-A-M.
It's zinc, but it's in a liquid for what's it?
It's on the end of little Q-tip type things.
You swab the inside of your nostrils, you pinch your nose five seconds every four hours.
Miraculous.
David in Avon Park, Florida.
Nice to have you on the EIB network, sir.
Hello.
Good morning or afternoon.
Yes.
Hi.
Hi.
Yes.
Okay.
You want me to start then?
Yeah, yes.
Okay.
I'm a United Auto Worker.
I retired in 99.
My retirement salary was $2,200 a month.
The union negotiated contract, negotiated us dollar for dollar away.
In other words, when we get Social Security, we lose it dollar for dollar.
Now, $2,200, I get $1,100 from Gerald Motors.
I get $1,100 from Social Security.
Now, if that's breaking the bank, I don't know what is.
This, as I've said earlier, this is a tough thing for me because I have no quarrel with anybody earning as much as they can.
I am not at all like people who want to limit what people can earn, but I do think it ought to be earned and I think it ought to have value to it.
And when you pay people who aren't working, it's a great deal if you can get it, but at some point, the people doing the paying aren't going to be able to afford it.
Well, let me say something to you.
I worked 31 hard years there at Gerald Motors in three different plants, having to relocate twice.
The CEO of Gerald Motors right now is making $14 million.
Roger Smith retired at $2.3 million.
His biggest salary was $750,000.
Show me a man that's worth three times as much retired.
I know this age-old class envy argument about management versus labor is never, ever going to go away, but you know it getting into it.
You know it getting into it.
We all have hard luck stories.
I've been doing what I've been doing for 40 years.
I've been fired eight times.
I've been told I can't tell you how many times I didn't have the talent to succeed.
And I'm paying for my own retirement.
I'm not counting on anybody to pay me when I leave this because there's nobody who will.
We'll be back.
Stay.
And that's it, folks.
We've got to get out of here.
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