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[inaudible conversations] >> it is great to be with you all to celebrate andd discuss n excellent new book of one of our country's most original and insightful economic thinkers, amity shlaes. over the course of our distinguished career, she is brought her wide range intelligence and feel for storytelling to some of our country's leading intellectual and cultural institutions. amity to serve as a member of the "wall street journal" editorial board, a columnist for the financial times and bloomberg news, and has taught economic history at the stern school of business. now in addition to a prolific book writing amity serves as a presidential scholar for king's college, chairs the board of the calvin coolidge presidential foundation and chairs the selection committee for the manhattan institute prize, and award she herself has one. her latest work, "great society a new history of the 1960s in america" is a stunning achievement. few decades have imprinted on the popular imagination quite as much as the 1960s and so many of us remember that they get for its most dramatic and turbulent moments. the assassination of the kennedys and martin luther king, jr., the march on washington and antiwar protests. neil armstrong on the moon and fighting at vietnam. her focus is not the trauma the play that on television screens across the country so much as the failure of washington to control these events and direct the show. indeed, generation politicians came to realize that the centralized hierarchical and highly regulated model of political economy that dominated postwar america has stopped working. yet more than just a technical failure, amity captures the feeling of the country run from the top down. america put up with the machinery and culture of mobilization during the two world wars ended early years of a nuclear cold war but at some point that old american yearning, , swashbuckling, independent-minded, mistrustful of authority was bound to reemerge. .. >> thank you. if youcannot hear me please let me know . thank you. a book about the great society deserves great thanks. my thanks to the manhattan institute president, ryan and salaam, its former president who is all always here, vanessa mendoza and peggy for hosting this event. i'd like to thank mypublisher for harpercollins .my agent andrew wiley and his colleague who is with us. i'd like to thank the coolidge foundationfor supporting me . certain friends including thomas smith, jim pearson, kim dennis and the kings college, especially josiah peterson worked on research. i'd like to thank my family, my husband and my daughter flora who areboth here tonight . the first sentence of the thbook is a question. why not socialism? this is a question we asked d ourselves last night when we watched the presidential debate. how do we answer it? question all centrists, all common sense people, all market people want to be able e to deliver an answer. we all feel an obligation to undertake the long-term investments in projects that would open american minds so that american minds see the challenge and tragedy of socialism. we want to share the record of the past or the record of venezuela so that when they come to vote or these businesses and families, younger americans recognize what is not useful policy but where are we? it's november in 2019. educating is a long-term investment and some of us don't have the heart for the long haul. we feel frustrated at the prospect of outcomes and perhapsoutright failure in our intellectual entrepreneurship . politics are much more funand instant gratification . all of us at some vanity people remember politicians, they do not always remember educators . we journalists, businesspeople, philanthropists, scholars, we want to be remembered to and sometimes we pick short-term projects for that reason tonight i'd like to tell you a story of a really long term object, a crazy project. this is the story which starts in the 1950s, features a company, a man and the american public. those are the three characters. it is indeed a story of a long-term failing project, of humiliation, of business shame and intellectual failure but the story which ends in the 1980s also reveals an unexpected payback . as some of you may know the characters but might appreciate hearing about them one more time. the name of the company was general electric . in the 1950s general electric road high. its factories in new york, massachusetts and connecticut employed many thousands. it was the industrial center in some ways. every year americans bought more tvs, radios or freezers. ge was not just a company, it was an icon. it served the space program, americans trusted general electric like it was said they trustedthe game of baseball . a good company that follows rules. as you know, the soviets in 1959 invited the us to create a display aboutprogress at moscow . america sent several modern kitchens and the lemon yellow one was general electric. most ge executives at the time, we're talking about the late 50s like executives at most companies at that time had a set view of how capitalism worked. a private sector was invincible. it was like a workhorse or a move now. what it was supposed to do was to serve as that milk cow to the public sector. the government heard in the private sector like a domestic animal . john maynard keynes noted at one point, to ge or most of ge, that sounded just fine. a milk cow was content with the government. the tennesseevalley authority essence of a government e project and ge executives at the top like it very much. ge found that the tva was one of its biggest customers. they didn't mind serving gethe space program. these executives, military-industrial complex. unions existed by virtue of very strong union law. and they demanded big pay packages, all right ge could pay that. social experiments by the federal government, american business could pay that. the expansion of healthcare, the us could pay that or perhaps a longer leave for young parents. that's just a joke. something like a longer leave for young parents in the early 60s, we could pay that to area heavy unions we could pay any load area stalin was said to have joked that the only country rich enough to affordcommunism was the united states . why should it not be true? why should it not be true? in the 1960s, just some benchmarks for you, the dow jones industrial average was approaching a record level of 1000. it seemed only amatter of months before the dow would pass its landmark .but there was one aging, underappreciated executive at ge who saw things differently. he was an older guy. he was a vice resident of labor relations and the name of this man was lemuel ricketts. he believes growth didn't come when a government pay hetaxes or hallway are believed growth took place when a lonely scientist in a dumpy lab had an idea and flaunted the world. an idea like the lightbulb, a ge idea. bulware believed the burden of government spending and the burden of union demands backed by government would gradually strangle american competitiveness . even a little bit of socialism. he said could do damage. the reason our 1959 kitchens were better than russian kitchens was filled with those all long-term investments of inventors at the beginning of ge. the reason the companies thrived was that the goods were affordable but the high wages and prices would render ge uncompetitive. in the end the russians would make better kitchens. nobody could quite imagine japan at this point. that was the scope of the imagination. it was the god-given e assignment and view of lemuel boulware of a pristine company like general electric to inspire america to return to old capitalism and the problem was urgent, boulware said. i'm going to read a quote from him. the current rapid trend has to be changed or we lose everything we cherish. the younger executives at general electric found boulware ludicrous. he wasn't modern. his superlatives irritated them. and in public many agreed with this evaluation fortune magazine described boulware as a figure who combined the folksiness of a kentucky farm background with the fervor of the washing machine salesman . the other executives at ge did not worry, they were the future. boulware was approaching retirement. by 1960 or 1965 he would be out anyhow. let him grant him his recliner in delray beach. still, boulware determined to use his final years and hours to make his own long-term investment in saving the future , ge and america's . he wanted to teach americans the nature, the death, the preciousness of the gift they had in capitalism. he spent millions of ge money mimeograph and pamphlets explaining thevalue of markets . he wore down where ge operated, that the high wages and all the extra social benefits force companies to leave. one such town was pittsfield massachusetts, and industrial center. he warned the people, grass will grow in pittsfield if pittsfield didn't wake up to the importance ofcompetitive prices and wages and costs . boulware used new media, in his case that would be television to reach the people, creating a tv show some of you have seen call ge theater to showcase traditional american values. he hired staff including that actor be ge's spokesman. remember, the actor was a union man, a democrat who admired glenn resident roosevelt and the new deal. still i won't say his name yet but this actor was hired had poured potential. we have our c-span audience so let's stick with the story. boulware kitted out a special ge house with all modern appliances kind of like the ge kitchen . for the actor to live in and boulware pulled the actor who wasronald reagan and adam smith , john locke with little essays added by henry catholic. he gave schoolbooks just like the manhattan institute does out and hoped they would be read. this actor, reagan was wasn't exactly popular across ge either. the younger executives didn't like having some kind of western propagandist and complain about reagan but for the few remaining years boulware was there they couldn't stop boulware and his actor and boulware since reagan all around to ge plants to explain all about the tva and the future of industry and the industry might move west and so on. then actor, he wrote speeches about the dangers of socialism and thatsocializing medicine was a bad idea. the tva was a bad idea . our could innovate faster when it was free to make its own decisions. maybe i drove power wasn't the only kind of power in the future of the united states and soon reagan began to take boulware's arguments seriously. he even boughthis son some ge stock . the year 1960 cast a dark cloud over ge boulware and boulware's propaganda mill . the justice department was investigating the company. in 1961 the new attorney general whose name was robert kennedy pulled together a strong case that ge was colluding with other companies like westinghouse to fix i prices on the turbines it sold to the tva. the justice department went to court and the judge sent the ge executives tojail . the irony was undeniable. there was ge's propaganda department wamouthing off about free markets even as ge cheated the american taxpayer. this was a terrible blow for ge and for boulware. the company looked like the worst hypocrite in the world. people felt betrayed by their trusted company. it was like the blackrock scandal of 1919when this happened to ge , a national betrayal, ge stock went in the toilet. the actor was fired. ge theater was canceled and lemuel boulware got pneumonia and did retire to delray beach. the subject of the great society only deepened the sense of failure for such a venture . ge itself deep in its cooperation as did many other companies with thefederal government . the news on boulware's tv set mocked his old efforts. american voters turned away from socialism, they thought social democracy was just government expansion sounded nice. they voted in lyndon johnson and a socializing program, we can call it that, the great society. johnson promised to cure poverty to make america an even better place, a great place with an even stronger economy and they did create the beginnings of our national healthcare system that we're getting now, medicare. this era, the great society leader did strengthen unions and johnson was only the beginning. one of the revisions of the great society in this book is a revision of richard nixon. in my research i discovered nixon actually expanded government as johnson had before him and in some areas even more rapidly. and other presidents just had it on, if you want to magic imagine a great and crossing process of program upon program. we got charles murray at the manhattan institute was the first to layout the numbers and prize winner john cogan laid out a few more. some of you were at that event . there's the scope of what the great society yielded. by 1980 health and medical costs were 16 times the 1950 cost in dollars. by 1980 public assistance costs were 15 times the 1930 costs. insurance costs were 27 times their 1950 level and housing costs were 129 times their 1950 cost. if you recall last night one of the candidates guested we needed to spend more on housing. so what happened? the great society failed. the government expansion did not eradicate poverty. it in fact the reduction in the poverty rate, it was already coming down and flattened out and we ended up with 10 percent and stayed there. the programs shackled americans into dependence. generally speaking there was th a terrible morning after effect of all the great society binge. the economy began to flail as it never had before.you know that unemployment went towards 10 percent and we know that interest rates went past 15 percent. the high cost of labor under policies backed by the government did drive american companies to leave town. grass did grow in pittsfield. justice boulware as predicted the great fire thriving center of detroit and become the rust belt and i write a lot about that and great society. the dow jones industrial average day below 1000 for a generation. today, younger americans believe an ever rising stock market is their birthright . they expect nothing else so you want to stop and contemplate that duration from the mid 60s until the 80s area even in a nominal terms with great inflation we didnot pass 1000 . imagine if today we had to wait until 2035 to get to the next barrier. in my book, what i learned in writing it is that you don't have to be socialist kall the way to be damaged. indeed, boulware was right, even a little socialism does incredible damage. this is not zeno's paradox, it's the highest road to serfdom, you do eventually get there and in fact sooner than you think and the whole while you can imagine boulware who lived decades beating himself up about the failure of his effort at el enlightenment but as you know, one figure was enlightened and didn't care. that was the actor reagan he decided to try politics and ryhe took his standard ge speech out of the can and gave it on tv. it practically word for word, america had to choose socialism or not area this became known as the time for choosing speech and then the actor ran for governor of california where he challenged the great society numerous times including the legal department that came out of our poverty program and he put the policies of ge into practice. government restraint, saving money, fighting expansion of welfare, personal dignity , respect for markets and when he did run for president and one, it was 1980 and it really was no longer the morning after effect of the great society. it could be mourning in america . the entire counterrevolution reagan brought that morning in america came out of those little boulware pamphlets that len had so lovingly prepared . boulware's long-term investment that no one remembered had paid off in a magnitude that was near unimaginable. markets arrived i'll stop and say there are several lessons from thegreat society. that's one of 12 chapters in this book . first of all the lesson, the overarching lesson ofthe book is that government is rotten planning . no matter how much it spent, you get a perverse outcome. the second lesson is that a private project or a philanthropic project, one of ours that looks like a complete goof or a failure in the shorter medium-term may not turn out to be a complete failure in the end. sometimes a project is just early and sometimes that holiness is good . commit on the point of view of the voters. who learned about markets from ge when reagan talks in the cafeteria of factories. some of those tens of thousands of meetingsbetween reagan and ge did have an effect . those voters understood what reagan was saying when he spoke up as a politician but there was another way for the tamerican worker. they emerged in 1980 as reagan's famous blue-collar boat. another point more obvious but worth mentioning is that the great society offers a lesson on trustingyour own judgment . if you suspect that a program has been good, it probably isn't . if you suspect a program might be good, invest in it . think of the institutions that inspired you as a child and lay the plans for your own institutions. much of the work that i do in the manhattan institute does, is trying to plan the seeds. theoretical seed can be the most fruitful seed. a third and final point, individuals matter. without manhattan institute scholars, individuals dollars there would have been no broken windows policy . without boulware, no reagan. >> if you think your name like i'd like toraise a theoretical glass of wine will be remembered for doing this work , you may be wrong. i'm standing right here in ht manhattan in 2019 with you. three decades after the death of that obscure the executive everyone in this room is raising a mental glass to reagan, his public policy work but also most of all, raising a glass to the name of lemuel boulware. thank you very much. >> raise a glass i have agreed to take a few questions. >> yes sir. i won't have that yet. how are you? >> i'm michael myers, the right coalition. when i think about a great society two things come to mind. lbj and the race revolution in america. the civil rights revolution, the riots in the streets. lbj's response to that was the great society, helping blacks get out of poverty, helping blacks overcome societal discrimination and what i remember about the great society is was that lbj was abandoned by people who opposed the vietnam war and the only people stuck with him were the naacp civil rights agenda. class my question is for you, what about the civil rights revolution in america? how can you not touch on that in your book and how can we explain the great society without talking about race relations. >> it is my book and very extensively. this was justone chapter . the book looks at civil , so we have the civil civil rights act which came before as you know the voting rights act and basically the voearly rights are great and important and revolutionary and without them, we wouldn't be where we are. the later laws, particularly following thehoward university speech of president johnson were more about benefits . that is, positive rights, what people get and when i argue is that those benefits didn't help for people, white or black. they kept them poor. for example, today we had the hillbilly elegy book that's so important, oh my gosh. appalachia, what can we do. kind of struggling group that has in its pathologies in addition to poverty. in the 1960s, we had an appalachian law in order to improve appalachia but it didn't help appalachia, it just made life harder their accustomed to people to getting benefits. so i divide in this book, i marked the divide at johnson howard university speech. i think johnson got ahead of his keys. and i do have a very, we can move on but i do have a long treatment of the 1964 convention at which the mississippi delegation was not seated and the decision kind of betrayal by organized labor with johnson to turn away those people because they needed the vote of the regular mississippi party. >> i'm excited to read your book, it seems like the rightful successor to your forgotten man but which was also excellent. there seems to be two schools of thought on the political right about the welfare state. the first is it was bad and counterproductive, the second which is more modern and more accommodation or centrist is that it basically does enough or about enough and if you include transfers and tax credits into poverty rates, since 1960 you'll see that a lot of these programs helped to reduce poverty and we shouldn't accept the left-wing narrative that we need to do so much more and tax so much more and do so many more transfers and embrace the scandinavian or european type of welfare system. where do you come down on the ocenter-right point of view that there's basically enough transfers now so kind of accept the great society. >> that's a very important question and when you count poverty, you can how to count it with benefits or without. when you go without, there are a lot of poor people so what are we doing? i would argue we are anesthetizing people. one of the, that is their becoming so accustomed, they don't see a way out. you don't see an opportunity to work. they don't believe they can work so i think it's destructive even if it keeps people quiet area clearly some of the benefits of the 1960s, particularly the money that flowed in chapter 4 from the office of economic opportunity to the cities was meant to calm people so they wouldn't lie. the money got caught in bureaucratic traps and because people were angry about genuine problems such as the bigotry of the police in los angeles but i don't think you can buy out people. i do believe we be stronger if we had a menu of opportunity rather than entitlement. >> nick gillespie, i'm partway through your book which i'm enjoying. i'll be glad to learn how to pronounce lemuel . could you talk a little bit about the relevance of your book to contemporary debate, about redistribution and about growing the welfare state ? which is really kind of new right now. people saying we need to be redistributing things much more then just to make it more complicated, what is the role of being in the cold war versus 30 years out of the cold war and how communism as a both an alternative model and a threat to the american way of life, how to play in e departments about getting benefits? >> can i answer the second first? the question relates to attitudes towards socialism though younger people today have nothing to compare to. i have not served in the military by and large. i haven't seen a lot. so they love an idea. younger people in the 1960s and my book as a chapter on the porsche ron statements, that would be people born 1940 or so. they were less nacve. they were still nacve but they were less nacve because the war was closer. because communism was closer. because their older brother was in the korean conflict. so now we have massive nacvetc to deal with and that's a problem. another parallel between that period that i would say nick, i think we're a bit liberated because if progressives can call for socialism and talk about socialism then we can talk about socialism without being labeled as renovators. this doesn't have to do with moscow. there are a number of progressives who make foolish errors in my book, few of them were actual traders. their problem was that they were wrong about their ideas domestically so we can talk about socialism now to without involving the soviet union and so on. but is there something else? i tried to do a good job. i always want to say one other thing, in the book i tried to capture the romance of socialism so you think about when young people go on a trip . they go to a latin american country and they see more social democracy or they go to scandinavia or their outraged. in my book i have a character who goes on a trip that is sort of an intellectual tourism. it's called looking for socialism and the character is tom hayden. recently ompeter collier died and peter gave me a picture of a comb that he had that tom hayden gave me. it was made from the fuselage of a downed american jet. it was a north vietnamese knickknack of pride and bragging that said hundreds of american planes downed and someone back home made a fuselage of a downed american plane to tom hayden who gave it to peter collier so tom's trip is a very romantic trip. and absolutely intellectually lazy, crazy in fact because he doesn't see the reality in hanoi at all. he had probably gotten away from the bombing and i wonder whether he didn't want to be blamed for bombing tom hayden but that's the story of the romance of socialism which is so present today. and tom's own confusion. the end of the chapter, he decides that socialism is wonderful because it's never finished and as long as it's not finished, no one may criticize it. that's the beauty of it. >> i believe we have time for one more question . >> my question is whether there is a society that has ever successfully woken from socialist anesthesia. is there a model that we might follow to walkback socialist tendencies ? >> i don't want to say something bad has to happen before we wake up but that's the usual pattern. the country gets knocked on the head. the country inflates and the country regroups. that's most countries. i do believe americans love business and the more young people we can expose to traditional common sense ideas, i'm talking about for each or decca or reading books thatthey unfortunately don't get to read in high school or learning about calvin coolidge . i see theyrespond with great excitement . i hope sirhan will permit me to plug my foundation. we have a scholarship for academic merit at the coolidge foundation so it's like a specialized school in newyork with a rhodes scholarship . it's really about academic merit and its quite serious competition we only have four scholarships a year because they're veryexpensive. it's a full ride to college . and we already ashave 15,000 kids who have registered to apply for four scholarships this year. what do those kids want? they want the money. they want independence from their parents rhythm they want to not have to fill out the fafsa a lot of them also like the idea of doing things on your own. so i think it's important for all of us to send signals to young people that you will be rewarded for enterprise, for trying, for doing things on your own area and currently our system doesn't particularly do that. it's more a reward system about how you can figure out about what you can get from the point of view of a 17-year-old so i think it's quite easy to change the political culture if you focus on 16 to 20-year-olds and show them what's in it for them and also play to their natural wisdom which they have and say we understand that you might think this and you might not be wrong. please join me in thanking o amity. >>. >> and i encourage all ofyou to buy a book . for a friend, buy a copy for your enemy. all of them will be enriched by the experience of reading this wonderful book . [applause]

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