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Dec. 29, 2008 - Rush Limbaugh Program
36:32
December 29, 2008, Monday, Hour #1
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Welcome to today's edition of the Rush 24-7 podcast.
Well, for those of you in government, I hope you're enjoying your vacation.
For the rest of you, back to work it is on this Monday, December 29th.
Hello, once again, everybody.
Jason Lewis here, Minnesota's Mr. Wright, filling in for America's Mr. Wright.
El Rushbo taking a few days off over the holidays.
He will return a week from today, I do believe, January 5th, that would be.
In the meantime, we'll try to hold down the fort here.
I'll be here today and tomorrow.
Walter Williams is back on Wednesday, and Mark's dying on Friday.
We've got a best of, of course, Thursday.
So stay right here to the Excellence in Broadcasting Network.
You don't want to go anywhere else.
I'll tell you, did you have a good Christmas?
I had a great Christmas.
I actually worked out quite a bit.
I was working, going to the gym in Minnesota in the wintertime.
That's what you do.
You go to the gym unless you're an ice fisherman.
Ice fishermen don't go to the gym because it's right from the asylum to the lake, back to the asylum to the lake.
It just never ends for those people.
But I still could not get a good night's sleep last night.
I can't figure it out.
I went, and this is pretty good for me.
I'm a 53-year-old guy.
I mean, you know, I was a lot of fun before plumbing.
I'm telling you, I'm old.
I ran three miles at the gym, and I was so happy with myself, I went home and had three beers.
I don't know what that means, really, but nevertheless, still couldn't sleep.
So I'm a little groggy this morning as we get back into the swing of things on the Excellence in Broadcasting Network, 1-800-282-2882.
And don't forget RushLumbaugh.com if you're checking out, if you're going online.
Anyway, lots to talk about.
Did you see?
Well, obviously you didn't.
Most people don't.
But if you happen to come across Meet the Press yesterday, it was one of the more egregious examples of why nobody but nobody trusts NBC or the mainstream media.
First of all, is there a law in Washington on these Sunday morning programs that says the deck has to be stacked against the right?
Last time I looked, even a moderate like John McCain got 47% of the vote.
So wouldn't you think on a panel on Meet the Press or the other programs, let's say ABC and George Stephanopoulos, wouldn't you think the panel would be somewhat evenly divided?
You know, two conservatives, two liberals?
Wouldn't you think, why is it always three or four or five to one?
You had David Gregory, liberal, disguised as a journalist, moderating.
Then you had this wacko columnist for the Washington Post.
You had the usual suspects from Newsweek and everyplace else.
And then you had one guy from National Review.
And that was it.
That's balance.
That's balance.
And this woman from the Washington Post was going on and on about how Bush got us into this economic hole because of selfishness.
Selfishness.
Could we at once dispose of this bizarre, perverted view of what is self-interest and what is selfish?
Self-interest is the American dream.
That's why we're here.
Ours was an economic revolution.
We revolted against the Stamp Act, the coercive and intolerable acts.
We had the Boston Tea Party and no taxation without representation.
Although they should see it with representation, it's just as bad.
Regardless, it was an economic revolution.
That's really what our revolution was all about.
And the idea wasn't selfishness.
The idea was self-interest.
Rational, prudent human beings doing what they can to promote themselves.
What's wrong with that?
Selfishness is when you expect somebody else to do something for you, i.e., you want a bailout.
You want a handout.
That's selfishness.
This woman on Meet the Press had no clue at all.
How do you talk about the housing crisis without ever talking about Fannie Mae and Freddie Mac?
How do you talk about the housing crisis and blame it on Bush and company without ever talking about Freddie and Fannie?
They were the enablers of the mortgage crisis.
That's how we got in this particular mode.
You take away Fannie and Freddie, and you've got no housing crisis.
When you insure these subprime mortgages, Wall Street was going to leverage them.
What did anybody expect to happen?
When you tell people to make bad loans, they make bad loans.
That's exactly what happened.
And yet you look at the Democrats, Chris Dodd and Barney Frank that ran cover for these people, and we wind up in the same boat every time when government interferes, when government misallocates resources, when government distorts market incentives.
If it weren't for the matchstick of Fannie and Freddie, I'm telling you flat out, we would not be in the mess we are in today.
They ended up buying $1.6 trillion of bad mortgages.
They held them in their portfolio.
People were swapping or literally handing out credit default swaps, a form of insurance, based upon the implicit guarantee that, well, don't worry, if your bond goes bad, the government will bail you out.
They induced the moral hazard.
It's a little bit like the savings and loan crisis.
If you go back to the early 1990s, when the government said, well, don't worry, savings and loan executives.
We will insure every deposit your depositors make.
So you go ahead and make as many bad loans as you want.
We will insure it.
So as a depositor, I don't care.
I'm going to give a deposit to any particular savings and loan executive, knowing the government's going to bail me out.
The executives didn't care.
They were going to make bad loans, riskier loans, try to get the highest return with the most risk because they knew the government would bail them out.
The same is true for Fannie and Freddie.
And yet when somebody tried to limit Fannie and Freddie's mortgage-backed security portfolio, i.e. the Bush administration and others, who stood in the way?
It wasn't selfishness.
It was Barney Frank.
It was Chris Dodd.
It was the Democratic Party.
It was Barack Obama, in point of fact.
You go back to 2005 and there was a bill, in fact, to limit the exposure of you, the taxpayer, to subprime mortgages.
It was defeated in the Senate Banking Committee.
It was defeated by the usual suspects, the people getting the big contributions who protected Fannie and Freddie.
They got the big contributions from Fannie and Freddie, Barack Obama, Hillary Clinton, Chris Dodd, and many others.
Now, there was some Republican culpability here, some Republican lobbyists to keep the hands off Fannie and Freddie.
But primarily, this is a Democrat scandal, which is why Meet the Press didn't want to talk about it, which is why the mainstream media keep blaming the economic malaise on George Bush.
It's selfishness.
Selfishness is not working 60 hours a week instead of 50 to provide for you or your family, or for that matter, your relatives.
That's a healthy self-interest upon which all a human condition is founded upon.
No, selfishness is when you expect others to do the work and you to receive.
That's called government.
So let's get our terms straight here.
Oh, and they were talking about Iraq, and it was all presumed that the Iraq was a failed enterprise and all of that.
You know, I find this rather interesting.
Article in the New York Times today about how the TV news folks are winding down operations on the Iraq war.
The Iraq war has evolved and the military strategists generally agree that tensions have moved to Afghanistan.
That's where the incoming president is going to focus.
In the early months of the war, so says the Times, the television images were acute.
They were abundant out of Iraq.
Viewers' appetite for stories from Iraq, you know, couldn't satiate their appetite.
Now they're waning.
And it's amazing what a little success will do, isn't it?
But yet the false premise on Meet the Press yesterday was, well, it was, you know, this Iraq war is really what did Bush in.
Really, I did a little research last night when I saw that program, and who do you think said this?
Quote, the threat of Saddam Hussein with WMDs is real, but as I said, it is not new.
Any idea?
Try John Kerry.
How about this one?
Yes, he has chemical weapons.
He has biological weapons.
He's trying to get nuclear weapons.
Any idea?
Try Nancy Pelosi.
How about this one?
On Monday night, President Bush, I think, spoke for all of us.
I know of no one who really disagrees at all.
There is no question that Iraq possesses biological and chemical weapons and that he seeks to acquire nuclear weapons.
Hmm.
Oh, yeah, that was Chris Dodd.
Folks, if we were duped into this, the CIA or somebody duped Bush into it or Bush lied and we went to war, then the Congress lied.
They voted for military authorization.
They said these things.
The British lied.
The UN and 16 resolutions at least, which were violated, they were lying.
How is it the people, this is so similar to the economic malaise which we find ourselves in.
How is it the very people who were as responsible for quote-unquote the Iraq war, the Democrats who voted for it, and also responsible for Fannie and Freddie igniting the firestorm of economic recession?
How is it that those people are now in charge telling us how we're going to get out from under this?
Does that strike you as odd?
Well, it doesn't strike me as odd when you watch Meet the Press and that sort of thing.
The duplicity never seems to abate.
By the way, one thing on the economic situation before we get going with calls and the rest of the program today.
Could I just say something that has been bugging me for quite some time?
And I don't mean to lecture, but it is time that we all man up.
There was an article in the Wall Street Journal this morning about this Russian professor who thinks the United States is going to break up in the year 2010.
The economic crisis, a whole host of problems will literally cause us to break up into different parts.
The California Republic, Mexico will control Texas, Canada will control Minnesota, which may be an improvement.
I'm not altogether certain.
But the point is, it's silly.
It's absurd.
It's not going to happen.
But why does this guy get away with showing up on Russian television, spouting this stuff?
Why is he taken seriously?
Because his whole premise is based on panic.
His whole premise is based on a self-fulfilling prophecy that Americans are going down the tubes because they think they're going down the tubes.
And this does get back to the mainstream media here.
This recession is nothing compared to what our forefathers have gone through.
I mean, zip-zero nada.
It's not even at the level of the 1981-82 downturn when we had to wring inflation out of the economy.
And then we had the longest peacetime expansion in post-war history.
Not even close.
We have become such a soft entitlement society that we think we're immune to the business cycle.
We think we shouldn't have a downturn.
We think we shouldn't save for a rainy day because recessions never happen anymore.
And when they do, oh my God, it's a crisis.
Turn on the news media.
This quote-unquote recession.
And by the way, we are in a recession.
I'm not disputing that.
And we are going to go through a recession.
That's the only way to get out from under this malinvestment, this artificial boom that the government has engineered with Fannie and Freddie and easy money and massive fiscal irresponsibility.
The only way to deleverage is, in fact, to go through a recession to get rid of all the malinvestment so we can get back enrolling again.
If housing goes up five-fold, it's not going to stay there.
It's going to come down.
But the recession itself will be only as bad as you make it.
If we panic like Treasury Secretary Paulson and Bernanke, if we listen to the media or the Democrats and a few Republicans, then this recession will be worse.
It will become a self-fulfilling prophecy.
Go out and do the things you always do in your life.
Man up and make those investments in your business.
Don't hunker down.
Don't be scared.
I mean, there's a lot of psychology in the business cycle.
There's a lot of psychology in this.
And if we don't really, quite frankly, man up and just say, you know what?
Yeah, recessions follow good times.
We'll get through this.
And I'm not going to cower.
I'm not going to hunker down.
I'm going to persevere.
This thing's going to be a lot quicker.
It's going to be a lot more palatable, if you will.
But if we listen to the media, if we listen to the Dems, worst economic crisis in history, government's got to grow leaps and bounds.
It becomes this self-fulfilling prophecy.
Everybody, you know, quits buying or everybody quits investing, even more importantly, because the economy is never going to turn around.
Hogwash.
It's going to turn around.
We've been through much worse.
I'm Jason Lewis in for Rush Limbaugh today on the Excellence in Broadcasting Network.
1-800-282-2882.
I hope your Christmas was great.
I am Jason Lewis.
We're back on the Rush Limbaugh program.
Glad you could join us on this Monday as we get back to work.
Already a call from a public employee.
You know, we had a bet going, and by God, I think he wins.
That did not take long.
We'll get to the phones momentarily as we continue here on the Rush Limbaugh program.
I suppose we ought to touch on the situation in Gaza before we get to the phone calls, and then we'll open it up for your thoughts and comments on everything we've gone over.
A couple of thoughts on what's going on in the Middle East this weekend.
As you know, Israel decided to launch some serious air raids into Gaza to keep the strikes or the rockets from propelling into south, the southern part of Israel.
There was a ceasefire that expired in mid-December, and as soon as it expired between Israel and Hamas in Gaza, why, the rockets started launching again from the Gaza Strip, from Gaza by Hamas into southern Israel.
So Israel said, well, that's enough.
We're going to go into Gaza, and they did.
Now, I'm not saying with an invasion, although there's talk about that.
But they are going in with airstrikes.
And as we know, the damage has been very, very severe.
And they're sending a message that we will not tolerate people launching rockets into our nation, which ought to be a fairly common sense solution here or a common sense point of view.
But there are a couple of interesting points.
The conventional wisdom says, well, okay, but was the Israeli response disproportionate?
That is, the number of those rockets that were launched into southern Israel did not involve casualties.
There were minimal amounts of casualties.
And therefore, why is Israel going into Gaza?
And, you know, I don't know how many are dead now, two, 300 probably, and wiping out the infrastructure of the security force in Gaza and going after Hamas to disarm them effectively.
And that's going to be debated on.
It always is.
And then, of course, there's the question, well, if they invade Gaza, are they going to end up actually strengthening Hamas in that beleaguered part of the world?
Because isn't that what happened when they went after Hezbollah in Lebanon?
They couldn't quite figure out how to get out of there, and now Hezbollah is even stronger.
There's another point, though, that I don't think is getting enough attention here.
And that is, where was the Palestinian president in all of this?
Where were the Egyptians in all of this?
They all have a great stake in this.
Look, I'll be honest with you.
I happen to be for a two-state solution.
The official position of the Bush administration, and certainly the incoming administration, is a Palestinian state.
And I think that's a reasonable position to take.
But you're not going to get a Palestinian state if every time Israel gives up land, as they did in 2005 to Hamas and Gaza, you're not going to get a two-solution or a two-state solution if every time they give up land, they use that land to launch attacks on Israel.
You think they're going to give up the West Bank, the Golan Heights, or any place else, if every time they give up a piece of land, that their enemies use that particular newfound territory to launch strikes.
So it seems to me that Abbas should have been involved in this, putting more pressure on Hamas.
It seems to me the Egyptians who've had their own border problems with Gaza should have been involved in this.
You know, this is an intractable problem.
It is a very, very complicated problem.
And some people don't like the fact that some of us, some of us conservatives, think this two-state solution is a reasonable thing.
But you've got to understand what's happening here.
And what's happening here is every time we get close to something that might be a longer-lasting peace, quite frankly, the Palestinians blow it.
Ask Bill Clinton about Arafat.
They were getting close there, and Arafat all of a sudden withdrew and blew it.
And now you're getting this situation.
This, I think, is the big point here.
The Palestinians should have been engaged in this, putting more pressure on Hamas.
But that did not happen.
And now you can forget about any peace plan before the Bush administration is done.
And quite frankly, I don't think you'll see one going forward.
Now, there's talk in some media reports that Israeli leaders had synchronized the retaliatory attacks to their political calendars.
There were some moderate politicians running in the February elections there that wanted to appear strong against Hamas.
And so those usual doves in Israel did a 180 and went after Hamas for this particular political calculation.
And then there's also, of course, the thought that Israel was going to act before the next president was inaugurated, not knowing what his reaction was going to be, having a better idea of what Bush's might be.
Regardless, I think reasonable people ought to look at this and say, gosh, is there really an interest in a two-state solution at all?
And if there is, the Palestinians need to step up to the plate.
And so does Israel, for that matter.
But so far, the former hasn't happened.
1-800-282-2882, I am Jason Lewis.
Oh, one other thing on the economic issue before we get back or go to the break and then go to the calls.
Paul Krugman is at it again.
Paul Krugman, living proof that anybody can win the Nobel Prize.
He now says, well, here's what we need in this particular recession.
We need much, much more government spending.
And boy, he's getting it with Barack's $1 trillion stimulus package, the bailouts, another trillion dollars.
I mean, think about this.
We've already spent $1 trillion since Bush got elected.
Great to be back.
Great to be back behind the golden EIB mic once again in the Attila the Hun chair at the Illimbaugh Institutes for Advanced Conservative Studies.
Hello, once again.
1-800-282-2882.
Without further delay to the phones, we go in Michigan.
Matt, I knew you would call.
It was just a matter of when.
You're on the Rush Limbaugh program.
Hi.
Hi, Jason.
How are you?
I'm good, sir.
Hey, took just a little bit of umbrage at your opening comments.
You should have phrased it.
The lackeys in Washington are gone.
I see.
See, there's a lot of us in municipal governments that don't get this time period off.
And we're spending all of our time slaving away, trying to get our budgets right, and just flat being there to serve the public.
But you've got time to call the Rush Limbaugh program, which is good.
Well, of course I do.
I've been a Rush listener since 88.
I do have to say this.
I do enjoy it when you were behind the golden EIB microphone.
Matt, thank you very much.
Look, of course, there are a lot of good and dare we say conservative government employees.
But when you're making an offhand comment or even a serious point, and that was a bit of levity, a meager attempt, albeit, but nevertheless, when you make those points, you make them for the rule, not the exception.
If I were to say that, look, we've got a crisis in education, primarily because education is being conducted in America today for the benefit of the National Education Association, the union, that doesn't mean there aren't good teachers.
There aren't a few conservative teachers.
But the fact of the matter is, and this is an inconvenient truth, the majority of teachers and the majority of certainly of members of the NEA are liberals.
And the majority of government workers, especially those who belong to AFSME or some other union, and that's where unions are growing the most in government, are liberals, even though you're an exception and a few others are exception.
So you can't literally get into a dialogue in talk radio or anyplace else, quite frankly, making certain you're speaking to the exception to the rule.
You've got to speak to the rule.
So understand, of course, I understand you're out there, but still, the vast majority, and by the way, this is a huge problem for the GOP.
A party that continues to grow government, grow government at every level, with more environmental programs, with more quote-unquote educational programs, with more mass transit programs, with more student loans, a party that grows government is not going to be around long enough to see the end of that because you can't continue to grow government and expect conservatism to grow.
People who get a check from government over time tend to actually support that entity that's giving them their checks.
And that's human nature.
So when I make these broad brushes about governments, understand I'm very cognizant of folks like you.
Matt, thanks for calling.
Have a great holiday in Baltimore, Maryland.
Joel, you're up next on the Excellence in Broadcasting Network with me, Jason Lewis.
Hi.
Yeah, I missed you said my name, Joel.
Hi.
Yes, I did.
Before I ask my question, sir, I would preface it with something I've been reading lately, some John Maynard Keynes, a good old Keynes.
Who I used to.
Oh, I see.
You've taken economics in college then.
They don't teach economics in college.
No, all they teach is Keynesian economics.
If you take a look at Samuelson's textbook, used to be the preeminent book.
That's all aggregate marginal propensity to consume aggregate demand curves.
It's all Keynesian.
It's all hogwash, and it doesn't account for what I can actually observe in a real market.
And this is why I used to think Keynes was something of a fool, and he just had just overlooked all the real science of it.
But now I understand that he was just a Bolshevik and wanted to create what he called the Solarius.
He wanted a class of salaried people in power.
Well, let's explain to the audience when we talk about John Maynard Keynes or Keynesian economics.
Let's explain a little bit what we're talking about.
Keynes came along at the height of the Depression with his general theory and said, well, the problem with a downturn is that the markets will adjust to high levels of unemployment, high levels of idle capacity, and the only thing to get them out of this malaise depression is the priming of the pump through government spending, primarily cutting a few taxes for consumers, but primarily government spending to increase aggregate demand.
And if demand goes up, why then people will produce to meet the demand?
Of course, Keynes was, you know, if it weren't for, I guess, the lack of knowledge at the time or even today, but Keynes had been answered, you know, 100 years before by Jon Stuart Mill and Jean Baptist Say, says Law, which says supply creates demand.
You don't need to create demand.
If you and I go to work and produce something, what we produce is our demand.
And so when Keynes says we need to increase demand, when Paul Krugman says it, he's a Keynesian socialist, what they're really saying is we're going to reduce demand in the private sector.
That's how we tax or that's how we borrow.
And then we're going to pump up demand in the public sector.
There's really no net increase in demand.
It's a zero-sum game.
All you're doing is substituting the wisdom of government for the wisdom of the markets.
Right, which is absurd.
I don't even think Keynes bought it based on some of his work that I'm reading now.
Well, initially he didn't buy it, but he had to come up with something for the general theory, and it was the standard.
Look, Richard Nixon famously said in 1969, we're all Keynesians now.
But I don't know how much empirical evidence we need to show that it doesn't work.
If government spending to increase demand could lift economies, we wouldn't have had the depression.
Right.
It doesn't work.
It doesn't work in theory based on a definition of man.
I mean, we are what we are.
And if that's considered for a moment, I mean, you treat economics like a science and you can't be a statist.
And you can't do politics.
You treat politics like a science, political science like a science, and you can't be a Democrat nowadays.
Well, I got to go, but the point I think you're making is there are ironclad rules of nature.
In fact, some would call it natural law.
It's in the nature of humans to react a certain way.
And we react for our own best interest.
We will not work perpetually for the benefit of strangers or the collective.
And those laws are immutable.
They're just like the physical laws of science or the physical laws out there in nature.
There are the laws of human nature.
And when you try to defeat those, you're going to end up with malinvestment.
You're going to end up with an economy that isn't producing.
And it's funny, you take a look at all of the countries that have tried to prime the pump.
The United States tried it throughout the 70s.
And it wasn't until Reagan disabused ourselves of this that we started to grow.
And we've grown for the last, what?
All throughout the 80s, all throughout the 90s, and for the most part of this decade.
This is really part of the Reagan revolution that we're still enjoying, even though now, because we had a massive increase in government spending, quite frankly, in the last few years, we had a massive investment in Freddie and Fanny.
We had regulations all over the place, from Andrew Cuomo at HUD to the Community Reinvestment Act to Fannie and Freddie itself and their affordable housing slush fund for politicians.
This wasn't a failure of capitalism.
This has been, in the most recent downturn, a failure of regulated markets, a failure of mixed economies.
That's what this has been.
And if we want to get back to producing, we want to get back to production, which is the first object of any good government economic policy, and that production will create demand.
Again, I can't reiterate this enough.
This is something called Say's Law.
Supply creates demand.
And if, in fact, you and I go work someplace, the idea of working gives us a check with which to spend.
The demand is always going to be equal to the supply.
When government tries to artificially create demand, they destroy it in the private sector, or worse than that, they print money, which is what we're doing now.
And that's going to devalue the dollar and wipe out everybody's 401k if we don't get a handle on monetary policy pretty soon.
Anyway, we've got David and Kathy coming up at 1-800-282-2882.
We'll squeeze our break in now and come back with more right here on the Rush Limbaugh program.
So don't go away.
Once again, having more fun than a human being should be allowed.
This is my Christmas present, filling in for the big guy.
El Rushbo, probably teen it up as we speak someplace, enjoying his well-deserved break.
He'll be back on Monday.
As I mentioned earlier, I'm in tomorrow.
Once again, Walter Williams on Wednesday.
Mark Stein on Friday.
Best of rush on New Year's Day.
Don't want to miss that.
All right here on the Excellence and Broadcasting Network.
Back to the call as we go.
Chippewa Falls, Wisconsin.
And Kathy, you are on the Rush Limbaugh program with me, Minnesota's Mr. Wright, Jason Lewis.
Yeah, thank you for taking my call and good day.
Well, that's my job.
I'm not as intelligent as some of the rest of your people, but I've been in a luxury business for many, many years, most of my life, and the service end of it, not the luxury end of it.
And have had to finally decide to go out of business about three years ago when I noticed a change in behavior of my clients, subtle, when the World Trade Center went down.
And then, of course, 9-11 changed a lot of things in their behavior.
And finally, to survive, I chose to stop doing it because the expenses and the capital input was more than I was ever going to see in terms of even a break-even point.
So I've been living this and have been a small economic indicator way prior to all this media hype and recession talk and depression and whatnot, way before it even became popular.
And my comment basically is, I've got a trusty pitchfork here that's unbiased and could be used in either direction, up, down, sideways, or whatever.
And I think all this talk is great that we're analyzing this to death.
What are we going to do?
And I'm ready to go unfortunately.
I'm ready to build my business back up again.
But I don't, I think the crucial factor here, and I've listened to you talk this morning, and the crucial factor that I'm struggling with myself in what kind of client do I want, is trust.
Trust.
Who wants to invest?
Who will invest?
Can you trust the investment?
Yes, that's a great point.
We do not.
Let me be clear about this.
We do not have a consumer spending crisis.
We don't have a spending crisis.
We're spending money like drunken sailors.
That's not fair to drunken sailors.
The government's spending money.
What we've got right now, to use the Keynesian lingo, is a liquidity trap or an investment crisis.
People are not willing to take a risk to open a business.
Hence, all that savings is sitting there buying treasury bills at 0%.
And so the question for government is not, okay, here's what we're going to do.
We're going to take all that money that people are willing to loan the government because they're not loaning it to your business or somebody else's.
And we're going to build green schools.
We're going to put wireless internet on school buses.
We're going to build another bridge to nowhere and another bridge to nowhere, another light rail line that you don't need.
And when that one's over, we're going to build another one.
That's just another stimulus bubble that will pop as soon as we realize we can't keep borrowing money.
You can't solve a debt crisis by taking on more and more debt.
Sooner or later, we're going to have to deleverage, go through this downturn, and then get going again.
So the question, it seems to me, Kathy, is the government policy ought to be looking at, okay, what do we need to do to get confidence in the investment community and get people not just to spend, get, I mean, we need more savings in the United States.
We've been relying on foreign capital.
But what happens in a normal economy is savings equals investment.
You save your money.
Somebody else at a bank or a venture capital fund takes that savings and they loan it to a businessman who increases the productivity of his employees with a new plant, new tools, and then everybody gains.
That's real investment, not government investment.
How do we get that individual to do that?
Well, here's what you don't do.
You don't tell them, well, don't worry about investing in the private sector.
Don't worry about investments for increasing productivity.
We're going to build another light rail line in San Diego.
Or Salt Lake City is going to get more mass transit.
We're going to have a vegetative roof on the target center in Minneapolis.
Those are going to be public investments.
So you don't worry about investing in the private sector.
That will never turn around the economy.
I agree.
And another thing you mentioned, which I am personally involved with all these years in this luxury business, I was teaching children.
And we're not getting our money's worth out of the schools.
When a college student tells me that I'm tougher than any college instructor they've had, it scares me.
Yes, not because I may or may not be tougher because those college instructors aren't tough enough.
Now we're one of the survival tactics we're doing is we're taking on some foster children periodically.
It's a service I see that is desperately needed.
These kids are desperate.
But I've got to let you go, dear, but here's what you've got to understand.
You could not be more correct.
The amount of inputs that are required to get our educational output is a national shame, quite frankly.
But what you do get when you invest in government at any level, whether it's higher education, whether it's mass transit, whether it's any particular government infrastructure, you get more government workers.
And that's what Paul Krugman wants.
That's what socialists want.
That's what the unions want who understand their only growth sector is government unions, the millions of teachers and public employees who have been unionized in the recent decades.
That's the fastest growth area.
And they understand if they can reach the tipping point, they can get more people on, quite frankly, the dole in America than people who are paying taxes, the game is up.
We will never be able to turn it around.
And that is the goal here.
It has nothing to do with an economic turnaround.
The only way to get this economy going again is to get private sector production going again.
And the way to do that is to encourage and incentivize investment.
You lower the capital gains.
You don't raise it, as Barack Obama plans to do in 2010.
You lower the dividends tax.
You lower the top marginal rates that encourage work.
You don't give another rebate or even a lower middle class tax cut to people that will probably turn around and save it anyway.
The purpose of tax cuts is not to put more money in people's pockets, although that's a good thing.
The purpose of good tax cuts is to encourage investment and production.
That is the only way we can all benefit without some sort of Darwinian dog-eat-dog survival of the fittest queuing up to government to take money from other people.
I'm Jason Lewis, and you're on the Excellence in Broadcasting Network.
Talents on loan from Rush.
Welcome back, everybody, to the Russian Limbaugh Program.
Jason Lewis sitting in for the big guy today.
Right back to the phones we go in Tempe, Arizona.
David, thanks for waiting.
You're on EIB.
You're very welcome.
I have a client that talks to me about she's left of center.
I am not.
And I want to know about the effects of Phil Graham's bill of 1999 to the present crisis.
He deregulated.
Boy, do they get their talk?
Yeah, don't they get their talking points down?
It was deregulation.
Yeah, that's right.
But the way that I'm reading what I'm reading about this is that was originally the bill, and then the Community Reinvestment Act got some teeth in it.
What, four times they re-voted for this thing?
Well, let's say they finally got it right.
Understand, your friend is trying to vie for a guest commentary on Meet the Press, no doubt, totally ignoring the elephant in the living room.
That was regulation and government intervention that got us into this artificial bubble of easy money and the moral hazard of insuring all of these subprime mortgages.
That's what got us into this mess.
But when you talk about Glass-Steagall or the repeal of Glass-Steagall that allowed insurance banks or banks, I should say, to own investment houses and the like, let me tell your friend or ask your friend, where would Merrill Lynch be today?
The fact that Bank of America was able to buy Merrill Lynch saved that company.
They would have ended up like Lehman Brothers going under completely if Glass-Steagall were still in effect.
It was deregulation that saved that big part of quote-unquote Wall Street.
But when you talk about the real essence of the crisis, you couldn't be more right.
You not only had the CRA that was beefed up, but you had Andrew Cuomo going in there at HUD under Clinton, increasing the mandates for affordable housing and subprime lending.
You had Freddie and Fannie, but by definition, have nothing to do with the free market.
They are government-sponsored enterprises out there with their affordable housing mandates, thanks to Barney Frank and Chris Dodd, out there buying up junk paper and telling everybody the taxpayer will insure it.
And sooner, sure as shooting, we did.
$200, $300 billion worth.
How could that possibly be a fault of deregulation?
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