Hello and welcome to cross talk were all Things Considered im Peter Lavelle the Economic System known as comfortable as in has generated more wealth than any other system in history in many ways it is defined maternity itself hundreds of millions have been lifted out of poverty however some has also witnessed growing income inequality the appeal of socialism currently on the rise. Talking capitalism im joined by my guest Geoffrey Tucker in new york he is editorial director for the American Institute for Economic Research in los angeles we have piii and he is an independent economic and geo political analyst former commodities trader and Strategic Planning advisor and in indianapolis we Cross Alexandra hudson she is an independent scholar writer consultant and speaker right across cycles in effect that means you can jump in anytime you want and i always appreciate go to pi 1st because i one of my rules on this program we always go to the person that got up early is that you got up really early for those programs and im very much appreciated by you know theres a lot of talk about how capitalism is. Performing and for home and we look at the generation x. We look at the middle millennial as we see the attraction of socialism in the polls so my question is very broad and its a very deep question at the same time as it is capitalism working if it is for whom go ahead. Well its a great question. My kind of response question is whether capitalism whose capitalism i mean its 201920 years ago we had the strongest economy known to man with you know Everything Technology and the promises of the internet and efficiency the lowest real rate of unemployment back then versus real unemployment right now being a multiple of what the government states that it is so why was capitalism working so splendidly back then versus the over indebted over leveraged version of it right now it really begs the question over if its classical kind of adam smith and David RicardoJoseph Schumpeter capitalism as taught in college and grad school or if its more of an i and randy unserviceable of the fittest at any and all costs by any means necessary vulture market fundamentalism that is built on increasing amounts of Financial Leverage and speculation versus actual manufacturing productivity and this is stand ability of a middle class i dont think its working in the same way that it had in decades past ok its good alexander in indianapolis i mean i think thats the point here is that i had im actually for capitalism ok i dont want any misunderstanding but im i want to work for everyone or more people than its working for now ok because we we see you know we hear you know depending on what side of the political aisle you are you know how well the economy is doing well its doing really well for rich people and that is undeniable when it goes a little bit further down i think its a lot more nuanced than the talking points that you hear on c. N. N. Or fox go ahead alexandra. I think i dont care right there its always more nuanced than the talking points from here on fox but im going adam smith himself wasnt naive and he recognized he wrote in his wealth of nations about that that that free markets would produce in a coup. He wrote for every rich man there will be 500. 00 porn and write but for him the universal opulence that free markets would produce was worth was worth it and we see that empirically objectively that that capitalism has has done a lot of good and reducing global poverty the number of times it was all those who live on a dollar a day has reduced by 80 percent in the last 3 and a half decades and so you cant you cant argue with with with facts like that ok jeffrey more or less the same question to you i mean theres a lot of being zire t. Particularly in the United States in europe theres a lot of austerity theres not a lot of hope actually ok i mean its treading water in europe in the United States again depending on how you want to interpret numbers i mean im glad the stock markets doing really well but that doesnt really tell you how the average person is living i mean i think theyre very much separated they have been for the last 40 years so i mean it is capitalism serving the interest of the majority in shouldnt be more than just a majority everyone go ahead jeffrey. Very specific reasons i think why growth levels declined over the last 40 years and this is i think what were really talking about here and you know people have expectations that every generations can be better off than the previous generation right there so that was the way we lived there was in support of postwar era and thats something happened you know in the early ninetys having just read about the state of growth and i think that something thats not capitalism its over regulation everythings over the regulators very difficult to have for if you are of i. P. O. s that we used to for example just because the stock market is heavily everywhere you regulate Financial Regulation is afflicted us in a grim way ever since 2800 when they tried to fix the system and actually made everything worse worse it has produced too much leverage. This is again i think were using the wrong term. Its like that capitalism i think is really regulation and central banking. Just a lack of access as wrap of the growth levels and some some level in some way its outrageous actually that weve weve come to this expectation rolling out to grow what. 2 percent a year this is crazy in the gilded age you know we had double double digit growth because the economy was much freer if we would free up the Financial System to get some sound money. Get rid of the regulatory barriers and heres whats interesting about whats going on right now with the trumpet ministration in some ways theres a lot of deregulation and thats good in other ways theres even more i mean what trump has done to trade is is creating a kind of chaos and its increasing prices at eliminating export markets and distribute supply chains and its really massively reduced Investment Business investment in particular in the Manufacturing Sector sector in the u. S. And thats only going to reduce grows more and guess what people are going to blame not protectionism by regulation once again you know but you were pure capitalism oh its not working its not working so i think we have the wrong name for the problem well i dont think i think yeah i think its actually the right goal to find regulatory i think it is to write me because thats what people are saying ok as a juxtaposition to socialism so i think thats been working here in a pie let me go back to you i mean one of the most important things here we had to get to keep moving here apply you know the consumption is the most important part to be Economic Growth right now but if that is under strain it is under strain i mean the number of people that have low paying jobs now is extraordinary and the savings level is negligible a shock can really hurt tens of millions if not hundreds of millions of people and it seems to me that if youre not concerned about peoples consumption because that is the golden goose that lays the egg here that drives the. Cami shouldnt we be looking more at families and keeping Families Together and speaking as a conservative it seems to me that makes much more sense because this whole financial ization of the economy just makes the rich super super rich which is just fine with me but i worry about the middle class go ahead pie i mean what middle class kind of. You know what i was saying earlier as far as you know the postwar war phase of a middle class a building has been dissipated over the past 20 years. You know people in suburbia and rural parts are wondering why the number of homeless have skyrocketed they attributed to laziness or and or drug abuse 2. In part because dad dad a proper dad a real transparent dad is not plentiful from the government and hence it causes confusion so that people blame citizens especially after the 08 crisis which tweaked the economy it was already in over leverage system the government came in to leverage to do even further amount of debt in the system thats announced is a multiple of grave multiple of what it had been before the real rate of debt including for instance a derivatives notional value of derivatives contracts globally is in the hundreds of trillions of dollars not even a number at that point we face catastrophe in a 2nd Great Depression in less than 90 years and yet people are calling it a Great Recession theyre evading it the other thing earlier you were mentioning. Capitalism versus socialism i mean the confusion is over there is a socialism existing within america in the u. K. Its a socialism essentially for the rich oh d yeah oh for fuss and its basically take if it was genuine capitalism which involves competition comparative advantages as written about. Then what as recorded written about what youd have as is failure of going concerns that are not going anymore instead you had a socialism come in and bail out banks calling other banks very back back of the curtain political decisions that were made over Lehman Brothers and bear stearns specifically and youre about to have a reprise of it because theres so much leverage in the system collaterals not being trusted in between banks and counterparty Insurance Firms and yet the fad and very counter democratic and counter a capitalistic practices is keeping its mouth sealed over whos in trouble how theyre in trouble why theyre in trouble how many further tens of billions of dollars per night is being put into the overnight lending reposed market in order to bail out already bankrupted firms because they know better nobody else in the in the in the thats all it is is that evil of understanding their lucid ation thats what they said in prior to the 2008 crisis here alexandria hi kind of got ahead of me here and what i wanted to ask is that there is a common criticism and i think its an interesting characterization is that there is socialism in america and its for the rich and its the its the really everybody else has to go through the rigors of capitalism there is something to that go ahead and indianapolis. Yeah its its interesting i think the most effective way of defending capitalism today is through the words of the father of capitalism himself out of smith who is an intellectual hero of mine and smith said over and over again in his famous book the book that made him famous ms day the theory of moral sentiments that any system any all good Economic System free markets or otherwise would only be as effective as good as the people who as the virtue of the more ality of the people who who lived under the system and i think thats thats true today in theory of moral sentiments miss talks about did the need for Human Embassy the need for compassion the need for and the need for sympathy and i think that that is one problem with the rise of inequality today where its increasingly of that there that that the case that there are 2 americas where people in upper echelons of society have no idea how people and the irish lions live in the struggle they have so so. Well ken i think thats one reason why we see socialism on the rise ok im going to go to a short break here you know one thing i want to say here the one good thing about having your own program we get to talk about adam smith another really smart people i like that ok after a short break well continue our discussion on capitalism today with r. T. This is kaiser report coming to you from an undisclosed bunker in the middle of nowhere so get ready for the apocalypse in the zombie infestation and ilan must have a saltire together. Ok in the special can something we can benefit says the men of the. Book to get us a little bit also if. You talk to home dont think in russia think was over forget it. The commune talked about earlier complete pressure we have the most feel some of the muscles of the. Russian outlets eligibility for the International Competition says that state this includes events like the Tokyo Olympics and the fee for world cup in qatar if i am in the early as last. Year where you can go just as it was 4 years ago in moscow antidoping plavix at the center of the scandal so who tampered with the doping samples database and one does greegor you want you could have to do with it and you know shes stupid because weve got to pull a mean you know put us in a bucket with the sportsmen that hes the push on the show you ship by to expose me on the front of a little bit so the pollution youre doing is not. Welcome back to crossfire where all Things Considered im Peter Lavelle you were discussing capitalism. Ok lets go back to jeffrey in new york and in my introduction we to i mentioned the important issue of inequality and any society all societies through history when you have a ratio of inequality gets so high you have political instability and its something everyone should look at and i think that really accounts for a lot of the discontent around the globe is because that ratio was hit a certain Critical Mass how do we deal with that inequality here i mean i said in the 1st part of the program you know i dont have this whole you know Elizabeth Warren mantra you know Bernie Sanders mantra against billionaires i dont im not against billionaires i guess i really want more equality and im coming from a conservative perspective here because im looking at the health of society the health the health of the middle class is ok because i believe in the middle classes the rich im not so i dont care about them theyre rich go ahead jeffrey. You know theres 2 ways you can bring about more equality in society one is by lifting up the poor in the middle class to be richer and i think thats what that whats happened the data actually show this with the other way is just to just to abolish billionaires a buyers levelers leveling American Public to know leveling is not going to work at the best catastrophic so im actually i actually worry about the term equality here because of for so its a term derived from math so its very contingent on proper data my colleague phil magnus said has been running the numbers now for the last 5 or 10 years and hes got completely revised that on the show in that theres been no rise in inequality is such in the United States its about this since the 1960 s. A lot of that is being manipulated for political reasons i would caution you to just you know except. The prattle of that you get Mainstream Press about this whole time and look around to even question about this idea that somehow the the poor are suffering in this to america the last of it you know the poor have to do it have a so much access to Good Services like theres never been before that walmart so ubiquitous prices are falling for clothing and food americans just spend 3040 percent of the budgets of food now its less than 10 percent you know the basic access has been almost universal laws that i really sometimes i think a lot of this talk about inequality is just a bunch of convention about but nothing is done so this is perfect right but i think what were really interested is not more equality bit more opportunity looking for avenue but ok and i think thats going to come about through for the for the for the do very well for the deregulation so i think we should be a little more precise in our terminology what we want is is equal access and opportunity for everybody and for everybody to get richer right thats that thats what i think we should seek i was talking to a socialist by the way the on a on a train in new york. She said im a socialist and im like ok this is going to be a long trip and i thought out i asked her. About this isnt the thing that we want everybody to be universally rich she said no we do not because the rich always get rich at the expense of everybody else so and there so i think she is wrong and in a true Capitalistic Society every trade that takes place should be richly advantageous advantageously can all make wealth together and a cooperative yeah good way that live our latest perspective on why i lived in communist Eastern Europe in the 1980 s. Nobody has to tell me about communism in marxist theory i lived through it ok and it is a dead end full stop ok ok pi a lot of inequality to write a lot of and there was an enormous amount of inequality and communism ok i absolutely had to be good ski i want to keep the inequality going let me go to pai here but theres the perception i agree with ok jump in go ahead thats a point of program go ahead in a way yeah i agree with i agree with geoffrey were guarding the earlier statement that he had made a couple of things involving the issue of sound money that he had referenced as well as what he just said as far as opportunity if youre lazy and you know you just dont want to work then theres really kind of no need to kind of apply 3 the ball of equality to you however if you want to be socially immobile and youre willing to work you should be able to have some advantage within a genuinely Capitalistic Society agreed on them as we dont live right now currently in a genuinely Capitalistic Society jeffrey should really really evaluate what were genuinely living in the Federal Reserve is this socialistic of an institution by definition i mean marx was very pro central bank i agree with as ken exists and is being socialistic again as we had referenced earlier towards a very. A very small percentage of people that have purse unprecedented levels of Insider Information yeah and shared amongst each other and have managed to gain aggressively over the past certainly over the past decade let alone really since the dot com bubble burst or as you know your average joe that what she wishes to work harder have his or her kids. Do better than his or her generation did have it that much more difficult why because jeffrey was mentioning that inflation and and other data is not as bad as it seems it is ok if you be picky and choosey with regard to inflation youre not listing insurance premiums youre not listing education costs youre not listing medical costs that tend to put people into bankruptcy and and outright homelessness fairly rapidly then you know youre not youre not youre not youre being youre being totalitarian and i use that word tactically youre being totalitarian with regard to information dissemination to quote your rough paraphrase your guest in the midwest you need you know the smithy and morality that was referenced earlier resides on a bedrock of proper transparent credible honest information and the worst the system the bigger the lies and were suffering from systematically lying from the fed and the bureau of labor statistics and others on down to the point where people are unable to plan the currency itself is so graphic catastrophic lee debased that we didnt know what it means anymore and its by design an order then replace this dollar thats essentially a used dish rag by Something Digital nontransparent auditable and turn off of will for lack of a better word visa via the block chain within the next several years because the powers that be know what they what theyre doing. Theyve known that that all of the thief dollars per se is going to have a shelf life to it thats why we went off the Gold Standard back in 71. 00 and thats not coincidentally the timing of that with regard to you know gradually dissipating. You know lifestyles and hollowing out of the middle class is because the currency itself is not ok Alexandria One of the things that its touched upon it already in this program but you know i think its something we should be really worried about is the generation in their indebtedness and their prospects prospects for the future when you when youre laden with so much debt you ended up living with your parents in your early thirtys youre not getting a job in the field that you study which you know that happens a lot but when you study something with studies at the end of it well you should be as a head a heads up youre not going to do that ok and being after university and getting a degree a degree youre in low wage jobs jobs and that is again this appeal of socialism because they see that its so insurmountable theyre not going to do better than their parents and that is vivid thats very real when youre living in the basement thats really real go ahead alexandra. I think youre right peter that this this issue of rising student debt and a dearth of well paying jobs has contributed to mistrust in free market system as being a system that works for everyone i absolutely agree but i mean as was mentioned by my fellow panelists just a few moments ago objective measures of standard of living are i mean were living longer where we are we are more educated you know a litany of these touchstones for for general well physical well being and objective standards of living are up yet i think whats important keep in mind is that we are not just you know physical beings were social beings were spiritual beings were emotional beings as well and we do have this sort of crisis of meaning where about a few moments ago peter you talked about the family how do we support the family we see the family breaking down the church breaking down communities breaking down all across the country and i think that people are displaced daily these are the traditional foundations of where people derive their meaning from and without those people are looking to to ideology it in this describes the rise of the inflation and tribalism and other radical ideologies as well and you also mentioned a little while ago peter Eastern Europe and your time there and i think thats a really powerful illustration theres a great book by a gentleman named Ernst Gellman called the conditions of liberty where he talks about this this struggle in the post soviet era where in the west we were well meaning and tried to airdrop these democratic and free market institutions on these post soviet countries and they didnt work because there was this lack of community this lack of social trust this lack of civic bonds between individual citizens that have been so corroded by years of mistrust under under communism and so i think its important for this missing in point that any system is only as strong as as individuals and individual communities as well you know its kind of a twist on that great churchill line. I capitalism is the worst of all except for all the others ok but lets go to jeffrey go back to new york but the other one thats being touted so much is socialism and on this program weve made a number of programs on the appeal of it i mean i find it a poor end but it does get a lot of traction and we have president ial candidates speaking about it in the most positive way and i think that is a disastrous plan to mean i think capitalism as it exists today echoing some of the things that pyatt say needs to be reformed in modified but dont throw it all out no way because i saw i saw the past and i saw the past and it failed well give the last minute to jeffrey go ahead. You know its been its been unbelievable to see the rise of social side the ology in the last you know 10 years and that says i never i was there i remember when theyre all collapsed in 1009 i thought well you know we dont have to worry about that in wherever we are socialist and where well here we are and socialism is that all the academia young people are supporting sure they know what it means waiver that means rule by a social media or something i think out of the know what socialism is new is popular and i worry about its an absolute cancer you know i do think it is 1st of all its an academic sort of exercises coming out of the universities which are largely subsidized by government and by this terrible stew student loan problem which is a very serious issue which is the sells itself a socialist a constitution because kids are getting themselves massively in debt and 66 figures and barely giving their green is not user degrees once they get out of college and then they get really bitter because theyve got another 20 years of payments going to have in the cab the car bare bankruptcy if they dont pay him the well i will tell him thats over like normal its all the time we have here are terrible and its all its all and all the jobs are we run a time and i want to know my own know here the and that educational system is a fraud and it should be ended in death for audit ok thats all the time. We have many thanks to my guess in New York Los Angeles and in indianapolis and thanks to our viewers for watching us here at our d. C. You next time you remember crosstalk rules. In his community there are people who believe that its ok. Its really hard there are no jobs and you see that ive got kids that ask and as a parent. I can come up with lots of arguments theres a lot of conflict in the game between the 2 most of the conflicts i would say over balls around money and most of them money is made. Close one on each other. Each other is good because the state of california alone makes 6000000000 dollars a year of to prison complex just to get some 20 a life where. You dont care anymore nobody cares about you so you dont care might anything. I am max kaiser this is kaiser report coming to you from an undisclosed bunker in the middle of nowhere so get ready for the apocalypse and the zombie infestation and your lawn lusk how does this all tied together host off to staceys well there was an interesting question asked on line and were going to look at it here because its a very good question fitting in with our ongoing themes for the past 10 years the question is is elon musk prepping for state failure this is an article from marginal revolution and they were looking at a tweet stream proposed by future pundit where he asked have you noticed that either on mosque is driving development of at least 4 technologies needed for easier living in a failed state news about Power Outages in california brought this home obviously hes doing it with the power walls and solar roofs but not just those during the electric Power Outages the gas stations couldnt pump gas but someone with a tesla car could recharge from their power wall so 3 technologies for a failed state but theres another cheap rocket launchers from space x. Do you see the relevance to failed states lets talk about America America is a country of rugged individual is an individual sovereignty we all have our sovereignty as americans i mean a lot of musk is a prototypical American Hero because hes giving people back in this country what they deserve and