Story of war, politics, griftopia, and his most recent book, insane clown president. During our live threeour conversation, we would take your , and facebook questions on mr. Taibbis career. Live from noon to 3 00 p. M. Eastern, sunday. Next, a look at the impact Government Policies can have on u. S. Property rights. We will hear from former Trump Campaign economic adviser stephen moore, and a panel debate on the affected landuse restrictions can have on low income americans. This event was hosted by the Heritage Foundation. Good morning and welcome to the Heritage Foundation. I am the director of the center for free markets and Regulatory Reform here at the Heritage Foundation. I asked for those of you in the audience to please make that last little check of your cell phone. Make sure that they will not interrupt the proceedings today. We will get started right now. The event today is really designed to celebrate the publication of a new heritage special report on big Government Policies that hurt the poor and how to address them. The United States is a very compassionate country and we have an awful lot of government activities that affect poorer members of our population in one way or another. We have welfare programs, welfare spending that adds up to well over a trillion dollars these days and that can be in things like health care, direct income support at one time or another. We are not here to talk about those policies today. We want to talk about another set of Government Policies, those that are put in place for what seemed to be on the surface very wellmeaning purposes and in fact they made the necessary they may be necessary policies of one kind or another for government. But if you look at the second or thirdorder effects of the policies, they have a negative effect on poor people. The kind of policies we are thinking about are policies that have two main impacts. The first is the impact on prices. The free market is not going to work very well or work at all if government is changing the relative prices of goods or labor or capital and there are lots of programs that government undertakes that have some sort of impact on prices and unfortunately because consumption is a bigger part of the expenditures of poor people, those kinds of policies tend to raise the prices of consumer goods tend to hurt poor people more than they hurt rich people. And the second set of policies are those of that interfere with the opportunities of people to work. These would be restrictions like occupational licensing or i suppose you could put minimum wages in this category. Things that interfere with the ability of poor people especially to get into the workforce and take care of themselves. That is going to be the focus of our program today. I think youre going to be surprised at how many policies there are. We identify several dozen in the publication and i think were just scratching the surface. Fortunately, we have very eminent people to start us off today. Our keynote speaker for the event is at dr. Don boudreaux and don, i would say i would have to say is one of the leading economic educators in the United States of america. And im just going to find his actual resume in my list of papers here because i want to tell you he is a senior fellow with the Frederich Hayek the program for advanced study in philosophy concepts. He is a professor of economics, a former chair of the Economics Department at george mason. He studies free market capitalism that is not a word you hear very often these days, we ought to hear it more. He specializes in globalization law and economics, and antitrust economics. He is the author of one of the very few blogs online that i go to every day. Hayek, and icafe recommend it strongly for those of you who want to know what is really going on in the economics world. After don speaks, were going to have commentary and hopefully a conversation. Steve moore is a visiting fellow here at the Heritage Foundation. He runs our project for Economic Growth that focuses on a broad range of topics, including tax reform, budget, and Energy Policy. He is a senior economic analyst for cnn and took a leave of absence for his duties as heritage to join the Trump Campaign as a senior economic adviser to thencandidate donald trump. He is the author of several books including his most recent fueling freedom exposing the mad war on energy. Please join me in welcoming john boudreau. [applause] dr. Boudreaux thanks, jerry. Im pleased and honored to be here, especially with steve. When people say that i am an economic educator, that means i no longer do economic research. I dont think thats true, but i believe that economists the world can better use more Economic Education than use yet another journal article putting a curlicue in some esoteric point. I think that is revealed in the state of current public understanding of economics, of the contents of the public debate during the most recent national election, or any sign of the state of the publics economic understanding. I think it is incontestable that the state of the economic understanding is pretty poor. It seems to be the worst in my lifetime, which unfortunately, is rather long at this point. On the one hand, this fact is understandable and forgivable. Economics, even at the most basic level, in a unique way thinking about reality, its not difficult, but it does take some effort. It does take some time and willingness to learn a new way of thinking. To use a famous analogy, it take a willingness to see beyond what is immediately obvious to look at what is less obvious, and to wear those lenses requires to put those lenses on and use them require some effort. Once that effort is put forward, it is not difficult. You wind up seeing a lot about reality that would otherwise remain out of vision. In one sense, its not appropriate to scold people for not understanding economics. We live in a world where we are all busy, we have different jobs, we have a great deal of economic specialization. To spend time learning economics means you spend time away from your job and your family and taking care of personal matters. I cannot scold anyone for not learning even basic economics. Maybe it is no more appropriate to do that than to scold an economist for not learning the details of carpentry. I dont know anything about carpentry. The difference is the fact that i dont know anything about carpentry, that doesnt affect the state of public carpentry. Things seem to be working pretty well with carpentry. The problem with economics, if you dont understand economics, you can still vote and make public commentary. The lack of understanding when it is displayed through the voting process, displayed through public commentary process, the results are bad economic policies. My not understanding carpentry doesnt inflict bad carpentry on the rest of the world. Peoples lack of understanding of economics inflicts that economics on the rest of the world. I dont have any solutions to the problem. I wish i did. If i did, i could probably make a lot of money. I point the finger of blame on my fellow economists. We have done a poor job since the time of adam smith of conveying an understanding of basic economics to ordinary people. There are some people, Milton Friedman being the most notable. Mises,n, ludwig von there are a handful of other excellent economists and excellent public communicators. We have too few of those. The basic truths are not out there in the public mind. I tried to distill the basic truths of economics as they are relevant to todays Public Policy debate and ive distill them down to the convenient number of 12. I couldnt quite fit them into 10. Here are the basic truths of economics as i see it. If these truths were better understood by the general public, the state of the public debate and hence the state of politics and policy would be better. It would not be perfect, but it would be better. These are in no particular order except maybe the first one. Number one, there is no such thing as a free lunch. I like that phrase. You all know what it means. That means that every benefit have a cost. That does not mean the benefit is not worthwhile pursuing or grabbing, but it has a cost. Every benefit has a cost. Often, these costs are unseen. The flipside is a lot of costs have benefits. To be sound economically, you cant just focus on the benefits you see and ignore the call or see the costs and ignore the benefit. You have to look beyond the first stage. You have to look past the first act. There are several acts in an economic play and it doesnt end after the first act. Number two, as a general rule, each of us spend our own money more carefully and productively than we spend other peoples money. This seems to me to be indisputably obvious, but judging from the Public Policy that comes out of this town, it does not seem to be obvious to other people. A reigning presumption among many people, mostly people on the political left, but not always, if you take money from person a and give it to person b, then person b will spend person as money better than person a will spend that money. I dont get it. It seems to me obvious that each of us, as a general rule, stands spend our own money more carefully than we spend other peoples money. Number three, when the cost of an action rises, people will not take the action. This seems obvious as well. Its more costly for me to do something, im less likely to do it. Probably the most fundamental proposition of scientific economics is the law of demand. It is a fancy way of saying when the cost of taking an action go up, youre more reluctant to do it. You will find some alternative way of pursuing your ends. Ends. Number four, there is no fixed number of jobs in a country or a globally. The socalled lump of labor fallacy is indeed a fallacy. People on the left, on the right, in the middle, up and down, often fall for this lump of labor fallacy. If these jobs are destroyed, what will people do . I think this is a grotesque fallacy, it is belied by history. One of my favorite statistics is looking at the u. S. Labor force and u. S. Number of jobs. Civilian labor force number of jobs. In 1950, some 67 years ago, u. S. Labor force was roughly 60 million people. Today, the u. S. Labor force is roughly 155 million people. About 150 larger than it was just 67 years ago. And the amount of joblessness today is a little bit higher, a percentage point or two as it was in 1950. The labor force, the number of people in the economy were seeking jobs in the sector has gone up, so have the number of jobs. It tracks the number of people in the labor force pretty carefully. We see this as women enter the workforce, a Larger Population enters the workforce, jobs are created. As long as the economy is reasonably free to employ those people. Number five, just as there is more than one way to skin a cat, there is more than one way to succeed economically. I confessed, i have never skinned a cat. Ive heard this phrase. I would like to say i would never skin a cat. Im glad to know academically there is more than one way to do it, but i do know, not from personal experience, but from my reading of economics and economic history, theres obviously more than one way to succeed economically. If the cost of one way of pursuing business rises, competitive entrepreneurs find another way to conduct business. Theres not one way to conduct business. Successful and dynamic entrepreneurial businesspeople are on the lookout for alternative ways to conduct their affairs. Number six, consumption and not production is the ultimate goal of Economic Activity. Thats the ultimate justification. Not to employ people, but to create goods and services that make peoples lives better as they judge them. Number seven, dont be misled by number six. Economic growth is caused by, driven by increased production. It is not caused by increased consumption. Increased consumption is a happy result of increased production. Number eight, nothing about a political border changes the nature of trade. Any problems that arise when nebraskans trade with koreans arise when nebraskans trade with kentuckians. Number nine, therefore, when foreigners sell to us, they do so only because they wish to buy from us or invest in our economy. Foreigners are no more willing than we are to accumulate lots of pictures, monochrome pictures of dead american statesmen. But to listen on the trade debate on the left and the right, you would swear the goal of most foreigners is to harm us by sending us things like steel, cars, and consumer electronics, in exchange for ever larger pictures of George Washington and abraham lincoln. As much as i admire George Washington, abraham lincoln, and jefferson, and benjamin franklin, and ulysses s. Grant, none of us engages in Economic Activity to acquire these pictures. We do it because we want to spend those pieces of money or to invest in them and the same is true for the chinese, germans, mexicans, and all other foreigners. Number 10, a trade deficit is neither a symptom of poor domestic economic performance, nor is it a source of economic performance. It is usually quite the opposite. I dont think there is any topic now that is more misunderstood, at least across the political spectrum, than the topic of socalled trade imbalance. The trade deficit, as many of you, i hope, know in this room, but if you dont know a trade deficit or the better term is current account deficit. A trade deficit is offset by a capital account surplus. America runs a trade deficit, that means america is running a capital account surplus. Foreigners are investing more in our country. I fail to see how that can be bad for us. I fail to see how a trade deficit reflects poor economic performance. Usually when i invest, i invest in companies and in sectors that i think have promise. If someone tells me that company is on the ropes, that company has a poor future, i dont rush to invest in it. I rushed to take money out of it. Number 11, a trade deficit is not necessarily debt. People on the right and the left, and economists are to blame for this because of the language we use, incessantly describe increases in the trade deficit as increases in american debt. It is not the same thing. It can become debt, but its not identical with debt. In principle, every trade can become nondebt. It can mean that but it does not typically mean that americans are going further into debt. It can mean that, but it does not necessarily mean that, and the incessant description of the trade deficit as a source of increasing american debt is very dangerous, because it leads to misunderstanding about what the nature of a trade deficit is. Number 12, and this should appeal to steve, because its about his great teacher, the most important and scarce resource, as julian simon taught, the human mind in free markets. Human creativity is what makes our lives and standard of living possible. We talk about Natural Resources all the time. There is no such thing as Natural Resources. Resources arent naturally productive. Resources are made productive by human creativity, figuring out how to use them, how to transform them into goods and services to make our lives better. These points, if misunderstood, guide us away from good policy. Why they may be meant to help pooroor, they hurt the especially. I will talk briefly about minimum wage. Minimumwage legislation is the poster child for such a misguided policy. It seems so right. This person is paid less money than we think they should be paid, lets order the employer to pay them more. The trouble with that is, as the cost of taking action rises, people are less likely to take action, the cost of employing lowskilled workers goes up, fewer lowskilled workers are employed. Until about 20 years ago, there was widespread consensus among economists that minimum wage has negative employment effects. By the way, thats not the only effect it has. Minimum wage can change the nature of jobs. Even workers who keep their jobs, some employers will make those workers work harder. The employer becomes less willing to let the worker use worktime to handle personal business. There are a lot of ways to adjust to a minimum wage for an employers standpoint, but one of the ways is to employ fewer low skilled workers. It knocks them out of a job and getting paid zero per hour is worse than getting paid whatever you would be paid if you had a job in the absence of the minimum wage. Even worse, its not the loss of current income. Thats bad enough. Its the loss of job experience and job skills that you get when particularly a young person and an unskilled person. And also the distribution of the harm created by the minimum wage is notable. I have a teenage son who was raised in Fairfax County, a nice, wealthy suburb, good schools. My son has never had trouble getting a job at the minimum wage. When he was 16, he was an unskilled, typical 16yearold. Although he thought he knew a lot. But he never had trouble getting a job. What the minimum wage does is when he was 16, he was an unskilled, typical 16yearold. Not only strip some lowskilled workers of jobs, but the low skilled workers that are disproportionately harmed by this are minorities in the inner city. They are the leaders who dont have their own personal means of transportation. They are the teens more likely to have to stay home to help babysit siblings. They are the teenagers who have gone to failing government schools. The employer for understandable reasons, when the cost of hiring a worker rises, employers go away from those workers and it becomes more costly to hire kids even like my son, but the risk of hiring innercity teens is even greater than hiring teens from Fairfax County or montgomery county. So it is the teens from the inner cities that are harmed the greatest by the minimum wage. There is a raging debate in economics today. Does the minimum wage really destroy jobs or does it not . The bulk of the evidence still shows that the minimum wage destroys jobs and that the bulk of those job losses are among inner cities and especially poor families. There are people who dispute this. The empirical evidence, i think, is conclusive. There are people who say empirical evidence is not conclusive on the matter. If you read the new york times, you would swear the empirical evidence is conclusive, because they conclude the minimum wage has no effect on the number of jobs. You can find, if you want, evidence in the literature that lowskilled labor, among all goods and services in the world, is the one good service that is immune to the law of demand. Him when the government pushes up the cost of using it, somehow employers say, ok, we will pay more and not attempt to protect our bottom line by adjusting. The second policy these are the two policies that upset me in my daily life the first is minimum wage, the second is trade restrictions. Another example of unseen harm. Its trite to say, but it deserves repetition given the debate we had in the past election, that you can protect certain jobs with higher tarriffs. When you raise tariffs on steel, foreigners make fewer dollars selling steel to americans and if they make fewer dollars, they uying fewer dollars b exports from america. Jobs are lost in those sectors. Foreigners have less money to invest in america. Fewer jobs are created by foreign investment. Americans pay higher prices for steel and products made with steel. Meaning that americans pay less money on products that do not have a lot of steel input in them. Jobs are lost in other sectors. Its very difficult to find evidence of this in the empirical record, if you are looking for specific jobs. Because its difficult, its easy because its difficult to find evidence of the losses, its easy to demagogue trade as a source of economic decline. The evidence on the prices that people pay for trade restrictions is pretty clear that trade restrictions raise prices, and the bulk of those price increases fall on poor and middleclass families. Rich people pay them as well, but the higher prices are the percentage of a familys income, the higher prices fall on family income. If you raise the price of imports with trade restrictions, the percentage of income that poor families will pay for Consumer Products will be much higher as a percentage of their myome than the percentage of income or really rich peoples incomes. My time is i think i will pass my time, actually, but just keeping in mind those 12, or you can rejigger the arrangement and come up with a few more, condense them a bit, but basic common sense principles about , ifway the world works people understood those principles, they would better understand Government Policies that appear on their face to help the poor, that appear on their face to promise a rejuvenation of americas middle class. They are in fact more likely to do the opposite. Thank you very much. [applause] hi, everyone. Don, i love your 12 iron laws of economics. I think they are fantastic and i want to post those on my wall. I think theyre words to live by. I thought i would just give you five or six examples of policies out there that are meant to help the poor that actually hurt the poor. Then by the way, were going to save a few minutes for questions. Let me quickly start by saying about two to three weeks ago President Trump came out with his budget with some increases in the budget in some areas but like the military budget, but big reductions in social spending programs. The last couple weeks, i like most of what is in the budget, it makes a lot of sense. I have been defending it. Every time i defended i get called a reporters who say, how can you support these policies . Dont you have any compassion . This is going to rip holes in the safety net. Dont you believe in meals on wheels and afterschool programs for people and so on. I just wrote my weekly column on this government is not compassionate. Government cannot have compassion. You and i as individuals can have compassion. Im not compassionate if i take your money and give it to a poor person. That is what a lot of these policies do. It is a kind of false compassion. Even with respect to meals on wheels, that is one of my favorite examples. When i debate liberals on tv or on the radio they say, you just dont feel any compassion for these people because you want to cut meals on wheels. I say, wait a minute, i participated in meals on wheels. Once every few weeks we make sandwiches and i help deliver meals on wheels to people who are elderly people who cannot get out. It is a great program. I love the meals on wheels program. But there is a sense out there that if government does not do it, it will not get done. That is simply not true. There is no reason that the meals on wheels program, if it is successful i think that is adequately Successful Program incredibly Successful Program cannot be done by charitable individuals. These programs would probably work better if government were not involved at all. Let me just mention a few examples of policies that i think clearly are hurting poor people, not helping them. Im just going to go down the list quickly. First, Energy Policy. I just recently wrote this book on the energy revolution. Liberals are against it. They are against fracking. Ever you go, everywhere you go it is horrible, we have to , shut down fracking, is going to destroy the planet. They are tried to hold back this energy revolution. One of the things that we found in our book is there is this program out there that liberals love called the lowenergy Energy Assistance program. I dont think we have to have the government subsidizing peoples air conditioning and heating. But we have this program out there and it is because the poor cannot afford to heat their homes and airconditioned. It turns out that program is about 1 billion a year. What we found is that because of fracking, which has substantially reduced the price of natural gas, it used to be 10 and now it is about three dollars, this was a huge reduction in the price of electricity and utility bills for people. What we found is the benefit for poor people from fracking and this huge increase in natural gas is worth about 4 billion a year. Fracking has done four times as much good for low income people as the low income Energy Assistance program. So what do we just get rid of that and have a policy that lowest prices. That lowers prices . Thats a good example. The second one is foreign aid. Foreign aid is a program that is a classic example of good intentions by liberals. We are going to help people in africa or people who are hungry in the middle east or wherever. It turns out all of your friends in the economics profession who have devised all these wonderful programs, there is zero evidence they had any effect on Economic Development. A good example of that is Economic Development aid to africa over the last 40 years we dont know exactly the number, somewhere between 50 billion and 100 million. 50 billion and 100 billion. But when you look at countries getting the aid, the countries that get the most aid actually fell further behind. Partly because those foreign aid programs created a dependency which actually limits Economic Growth and doesnt help them. If you were to ask the single most important policy to help poor people i dont think there is any question about it that the governmentrun schools in innercitys are the most in inner cities are the most devastating thing to lower income people and has created the cycle of poverty. You mentioned Milton Friedman. I used to have dinner with him every few months before he died in San Francisco. As you all know, he always said the single most important thing to help poor people was Universal School choice. We could in this city just one example, in washington, d. C. , where we are right now, the average poor resident of this city, mostly blacks and hispanics, could get a better education for half the cost in the Catholic School system. Were spending 20,000 per student in government schools. We could give them 10,000 to go to a Catholic School and it they would get a better education. The next one is Social Security. That will probably be second that should shock people. Social security helps poor people, right . Thats a great program. It makes sure what people grow old they do not become destitute. It turns out we ran numbers in fact, we just ran these with the actuaries in the Social Security administration. Instead of having the Social Security tax taken from workers every week, every paycheck, what if we just said to percent of a 10 of that, 10 of a workers paycheck would go into an ira account. They own it and accumulate the interest over the 40 or 45 years that they work. What we found is if you did that compared to Social Security, assume an average rate of return, that the average poor person would not only get a higher benefit from having this individual account, but they would actually be able to leave 1 million for the kids. So, let me cut to the chase, Social Security has robbed every lowincome family of 1 million. Thats not something youre going to hear a lot, but it happens to be true. Im going to make one more point, and that is with respect to progressive taxation. Progressive taxation is oh was is also something we say that helps poor people. Progressive taxation actually does not help poor people. He states that have the highest amount of progressive taxation, states like california and new york and connecticut and massachusetts, actually have had less progress for the portland ispoor in states where there no income tax or lower taxes. My favorite example of this is something were going to be debating over the next several months and that is the Corporate Tax. The Corporate Tax, we are told that is just a tax on very, very rich people who are shareholders in companies, and that is a good way to redistribute income. It turns out, nobody gets the effects of the things. The effect is connecting the dots when you have a Corporate Tax, the effect of the Corporate Tax is it reduces the amount of money that businesses invest in new machinery, equipment, building plans, hiring workers, and so on. There is almost indisputable evidence by my friend kevin hasset hiring workers, and so on. There is almost indisputablet on enterprise institute, and this has been duplicated by others, that the frontline victims of this Corporate Tax are not the shareholders of companies, they are workers who get lower wages and salaries because when they have less capital to work with, they cannot command the high kinds of wages they need. So, there are so many areas i will conclude by saying good intentions is not good enough. Most of what the left i will give them their due. In most cases they do have good intentions. It is just the results of their policies and of hurting the people theyre supposed to help. I want to add a 13th rule if i could to your excellent list. This is one of my favorites. It goes like this give a man a fish and he eats for a day. Teach a man to fish, and he works for a lifetime. There is so much wisdom in the economics rule. I would love you to add that one. Thank you very much. Why dont we just go right to questions because we are running a little behind. In fact, let me ask you a question on trade. There is an argument being made about trade, even among economists who are profree trade. I was doing something yesterday and this point was made trade is good, it raises da da da. But all these losers with trade. The people in pennsylvania, ohio, and michigan we not we are not compensating the losers for trade. I wonder how you would respond to that point. I only have a few minutes but i could talk for an hour. People talk about the losers from trade, they dont talk but the losers from protectionism. You can save some steel jobs, save jobs in the u. S. Prior u. S. Tire industry but putting tariffs on steel or tires. And you can see those jobs are saved. Those tariffs will destroy jobs elsewhere. It is more difficult to see where those jobs are destroyed but you can be sure there are jobs destroyed elsewhere. I dont know why we should protect these people in the Steel Industry from the forces of economic competition at the expense of the people in other industries. Protectionism has losers. Second thing i would say is there is nothing unique about trade that causes economic disruption, about international trade. Any kind of change in Consumer Spending patterns causes some jobs to decline, be destroyed. Other jobs to be created. When people complain about the job losses from trade, what theyre really complaining about is job losses from economic competition, entrepreneurial innovation, and dynamism. My favorite example is the polio vaccine, which is one of the Great Success stories of humanity. Polio is no longer a problem for people who were vaccinated against polio. But think of all the jobs that were destroyed. People who work in wheelchair factories, making iron lung machines. Nothing particularly to do with international trade, but we dont lament that. We understand that is how societies progress. It is the same thing with trade across international borders. It does destroy some jobs. It creates other jobs. But so does any economic change, any entrepreneurial innovation destroys jobs and creates others. If you really want to say we dont want any jobs to be destroyed, then you cannot stop with trade restrictions. We want to freeze all Economic Activity where it is. If you try to do that, that roadat hayek meant by the to serfdom. That would put us on the road to serfdom. I want to follow up on that. [inaudible] hold on. Just one second. You have two options and what one is protectionism and it protects steel jobs, and the other is free trade and maybe lose steel jobs, if it is just a tradeoff, what does it matter . In fact, maybe it is a loss to force workers who have been in the Steel Industry and had those skills for 20 years now waste their time learning new skills to get a new job in a new profession. Why should i prefer free trade over protectionism . Because what trade does, it does not increase the number of jobs, as some trade proponents mistakenly say. What trade it does is shift jobs over time from industries in which we have a comparative disadvantage to those in which we have a comparative advantage. Over time, trade moves jobs to where workers are more productive. When workers are more productive, their wages and standard of living are higher. If we protect steel jobs from competition, then what we do is cement jobs in industries that over time are less productive. Then the jobs that we are preventing from being traded, because those industries are more productive. Let me add one thing. This is a good time to be having this debate, because with the new age of Artificial Intelligence and Automated Vehicles and so on, the structural changes to the economy that are coming in the next decade are going to be credibly disruptive, and i mean that in the positive sense. The other night about a few weeks ago i had to give a speech in philadelphia and i drove back back late at night back to dc. There are not a lot of cars at 11 00 at night. I had never seen this before, a caravan of about seven trucks. Big 12wheelers, they were like a train running one after the other. When i passed it, i looked in the calves of the truck. Out of those trucks, do you know how many drivers there were . One. One. There were people in the cabs of the others, but they were moving forward like a train. One out of 11 males today are employed driving a vehicle. 10 years from now it will be close to zero, because everything will be automated. That will cause huge disruption. The interesting thing is this is hardly the first time we have seen these kinds of disruptive technologies. Probably the most Disruptive Technology in history was the tractor. 120 years ago, one out of three americans was growing food. Today it is two out of 100 grow more food than we can possibly eat. This is the big topic today, disruptive technologies. Robotics is going to change factories. What do you have to say about that . Is that something we should fear or embrace . I think it is something we should embrace. We always say we want the world to be better for our children. Thats the way you leave a better life for children. To let workers and other resources move into more dynamic and productive places. The best way to handle the disruptions, i think, are some of the things you mentioned. Lower Corporate Taxes. That will increase the rate of business creation. Get rid of a lot of occupational licensing restrictions. Get rid of the minimum wage, because that prevents the creation of jobs. There is a lot you can do to make the economy more adaptive, more quick to absorb into new industries, resources release from once displaced by trade or by innovation. What we should not do is cement things in place. Do you think were going to see the end of work . No. As long as human beings have unmet needs, we will have the need for human beings to work. One last question, then we have to wrap up. Why dont you each ask a question, because you both have your hands. . Ow are we doing on time the poor dont vote and generally dont engage in policy debate. So who in the republic looks after the poor . Who actually represents the kind of policies you just recommended . One of the main fallacies we hear today, especially from the white house, is buying american, hire american. Can you speak a little about that . Does made in america even matter . I think that definitely hurts the poor. Very quickly on that last point, we see these labels, made in america, they dont mean anything anymore. The only correct label is made on earth. [laughter] i stole that from the cato institute, but it is great. What the made in label means now is final assembly occurred in, but it doesnt mean its made in china or america. Even relatively simple products like clothing, they contain inputs and ideas from all over the world. The label just happens to be the place where code or your cell phone or glasses were last assembled. It is meaningless. But it appears to have meaning it does not have. In terms of your question are you asking who in politics . I would say the Single Person who comes to mind is rand paul. I think he gets this. He is more of a libertarian bent. This is apropos to what we were talking about. Its a perfect example of government intentions run amok. The two industries in america with most rapid increases in prices are health care and education. Those are the 2 industries with a price system doesnt work well because you have the government subsidizing or operating them. When you ask a liberal, why do we have the government involved in health care and education . What is the answer . To make it more affordable. Gee, theyre doing a great job. I think the lesson here will conclude with this, government intentions are not enough, good intentions are not good enough. We have to look at the policy results. In way too many cases, policies that are supposed to help the poor actually hurt them and add to the the left is so obsessed, fellow economists are so obsessed now with income inequality. Some of the work we have done shows liberal policies actually increase income inequality, not reverse. Thank you, don, that was a fantastic presentation. We will move forward with our second panel. [applause] ok. As we are transitioning the panels, i will briefly set the stage. Im going to intro what we are going to focus on. I work here at the Heritage Foundation. Project for Economic Growth. Essentially what were going to be doing is were going to focus on certain areas, specifically that affect the poor in terms of government their intentions to help. This chart demonstrates the Household Spending as a percentage of aftertax income. By quintile of income. You can see, it really does hammer home the point that some of these policies really are affecting the poor. Lets just look at housing. The lowestincome households spent nearly 60 of their aftertax income on housing. That is compared to 26 for highestincome earners. It is because of programs like rent control and various regulations against your use of private property as well as government takings for Economic Development. These are all programs hurting. Another one is energy. You can see it on the list as well. These are things that are really impacting prices as well. Leading to families having to choose between not eating for a day, paying the energy bill, or foregoing medical coverage to pay the medical bill. I will let the panel talk about that and im going to briefly introduce them. Our first speaker will be marlo lewis. Energy at thein Competitive Enterprise Institute in washington, d. C. His Current Research chiefly includes areas in science, economics, law, and the politics of Global Warming. He has been published in the washington times, forbes, national review, investors business daily, among various other publications. Hes appeared on various Television Programs including the Oprah Winfrey program. This is great where he provided counterpoints to al gores an inconvenient truth. I didnt get to see it, but ill youtube it. Its already 10 years ago. Well, its probably fantastic. Next, were going to have ronald utt. Independent economic consultant, author of recently published books, the war of 1812, guns of iron and the forging of the american navy. Previously he was the Senior Research fellow here at the Heritage Foundation. He wrote on housing, transportation, privatization, urban revitalization, land use, and Growth Management. In the 1970s he was the director of the Housing Finance division. In 1987, president reagan appointed him to leave his lead his efforts on privatization of federal activities. Hes the editor of several books, 21st century highways how privatization can help solve the infrastructure crisis, and a guide to smart growth. Finally, an allaround good guy, just a wonderful guy, darren bakst. Before joining heritage, he was policy counsel for the United States chamber, focusing on food and Agricultural Policy and Regulatory Reform. For nearly seven years he worked at the john locke foundation, where he worked extensively on Property Rights, environmental policy. He has appeared on cnn, quoted in usa today, wall street journal, washington times. He is an attorney. We will forgive you for that, dan. Will just bring up marlo right now. Marlo thank you very much for the kind introduction and dredging up some ancient history. For you,a little datum but that was a fun moment. And we just recently passed the 10th anniversary of al gores an inconvenient truth, so hes back, although he has less power than he had hoped to have even only a few months ago, for very obvious reasons. What im going to talk about is how biggovernment Climate Policies hurt the poor. And here, im pleased to quote from an alum of the Heritage Foundation who was briefly with the Trump Administration and who is coming back, and that is david chrysler. The thing to understand about Climate Policy is that almost all Climate Policies are either explicit or implicit taxes on carbonbased energy. What you can see on your screen, i just thought david said it so well, hydrocarbon fuels provide 85 of energy in the United States. A tax on Carbon Dioxide will drive up energy costs. These Higher Energy costs work their way through the economy, reducing income and reducing employment. David and nick and kevin and other folks at the Heritage Foundation have done numerous studies of cap and trade programs, which is an implicit carbon tax, or they have actually looked at the effects of carbon taxes set at various levels. For example, one study they did was a carbon tax set at the alleged social cost of carbon as calculated by the obama administration. Another study they did was, lets translate the cleanpower plan of the Environmental Protection agency into a carbon tax. Or lets look at the Energy Information administrations analysis of the cleanpower plan and then plug that into our own model. Heritage has its own model based on the Energy Administrations National Energy systems model. And the effects are always the same. Any kind of carbon price that is being debated today which is nowhere near as extreme as it could get will always have the same basic effect, that you reduce cumulative gdp growth by Something Like 2. 5 trillion over the next decade and a half. You raise the cost of gasoline by about 30 . You reduce the cumulative purchasing power of a family of four over a decade by 28,000. You reduce employment growth, especially in the manufacturing sector, cumulatively by about one million jobs over a decade. And so, the people who are hurt the most, obviously, are the so, the people who are hurt the most, obviously, are the people who were the first to lose their job, and that is usually people at the lower end of the economic ladder. One of the most obvious points s maybe this should be added as the 14th law is that energy taxes are regressive. All of these Climate Policies that increase the cost of energy. Thats because people at the lower end of economic spectrum spend a higher percentage of their income on necessities like energy and food. So, this was the chart i pulled out of a study that came out a calledrs ago by roger the social benefits of carbon. But it shows that if you are a family earning more than 50,000 a year, he spent typically only about 4 of your income on Energy Related expenses, but if youre only earning up to 25,000 a year, then your spending now youre spending over 10 of your income on Energy Related items. And if youre only making about 10,000, which may be people are just starting out, young people and so on, then all of a sudden come its nearly a third of your income thats energy gas, utilities, and so on. Someone of the obvious point here is that if you really care people, you should want to ensure the government gets out of the way as much as possible so that energy is as cheap as possible, not that you should subsidize energy because energy decisions, but you should not artificially increase the price of energy. This is usually thought to only exist in europe, but exists in the United States today, but millions of people because Energy Related expenses consume 10 or more of their income. They have to make these painful tradeoffs between heating and eating. This is one chart that estimates how many low income families have to make these sorts of tradeoffs where you go without food or you skip a meal in order to pay your utility bill or you skip health care that month. You dont go to the doctor even though you feel sick. Rent. Fail to pay the these are real, painful choices for millions of people and the folks who pretend that this Climate Policies are just a great business opportunity, they the alternatein Energy Industry in the state imposed a mandate that guarantees you a market, but its not a Great Big Business opportunity for people on the edge. There was a wonderful datum that i just read this week, it was a piece in the wall street journal. Im sure steve has read it. Anyway, what he pointed out was that in germany, which is often looked to as a model for what the United States Energy Policy should be, because they have a system to subsidize solar energy and wind energy even though germany has been building more coal power plants than the United States. The reason for that is that wind and solar are intermittent energies. The wind is not always blowing and the sun is not always shiny. So the backstop, germany has had to build a lot of coal plants, which is very hard for them to explain in terms of being good stewards of the climate. In any event, what the system has done is increase the cost of electricity to about three times the u. S. Average rate. As a consequence of that, 330,000 people in germany last year had their electricity shut off because they could not afford to pay the bill. So, one of the things that we hear about in the climate scare is that heat spells will become more frequent and severe and people are going to drop like flies. To this extent, what they say is correct. When the average temperature of the planet increases, heat spells will become more frequent and severe. By how much . Who knows. But here is what is interesting from an actual Empirical Data standpoint. Over the last 40 years, even though air temperatures have increased, and a lot of that is simply due to the growth of urban heat islands. And actually people in the United States voluntarily exposed themselves to much more climatic warming than Climate Change is producing, just by moving from the rust belt to the sun belt. Something like millions of elderly people when they retire experience probably four times as much climatic warming when they move to sun belt areas than the United States has experienced as a whole in a century. So lets not get too worried about small changes in global temperature. But the point of this graph that im showing you is that heatrelated mortality in United States has declined decade by decade over the last 40 years. The progress continues. Why is that . Its because more and more people have air conditioning. Its most of the population, especially who live in any kind of warm population, now have air conditioning. Airconditioning is probably the single greatest protection against Global Warming of any technology in the world. But if you raise the price of electricity, there are some people who will decide in the hot, sweltering summer that they simply cannot afford to run the air conditioner, because that is when electricity prices peak and it is more expensive. So you dont want to have people put in the position where they have to choose between airconditioning their homes and paying the rent. But that is what can happen if we get europeanstyle electric ity prices. Now, there is a climaterelated policy where you might think, this can only benefit the poor. There can be no downside. That is fuel economy standards. After all, the point of fuel economy standards one point of it is to make driving less expensive because you are stretching your fuel dollar. Instead of going 10 miles a gallon, now youre going 20 or ultimately they wanted to go 54. 5, that is the goal of the obama administrations fuel economy standards. On average everyone should be going 54. 5 miles an hour by 2025. Isnt that a great savings . Except there is no such thing as a free lunch. That goals for Fuelsaving Technology as well. It raises the cost of vehicles by several thousand dollars. Heres the point here. Lowincome households, in order to buy a new car, typically need financing. They need to get a car loan. The car loan is based on a formula that has to do with the price of the vehicle and , therefore, how much money you have to pay per month to repay your loan, and how much income you have per month. It is roughly that if the car payment exceeds 40 of your monthly income you do not qualify for the loan. The good folks at the National Auto Dealers Association did a study it is already a couple years old, but it should be considered by the Trump Administration as it reassesses the obama administrations lastminute fuel economy decision in november 30, 2016. But what they calculated was the cost to meet the fuel economy standards in 2025 would have the result of pricing about 7 cost to meet the fuel economy million americans out of financing for a new car. That means these people would be priced out of the market for a new car. I suppose you could say, well , they could always buy a used car. Thats like saying, let them eat cake. What is it that only the rich should have the opportunity to purchase a new car . I think darren is going to cover thats like saying, let them eat this. Here is just a slide i think is very funny. The future is here. This is a photo from the 1930s , which showed in certain places in the midwest there were already dedicated pumps to put ethanol in gasoline. But the point is rather obvious. Im sure you will cover it. Tell me if you are not going to cover it, darren. It is simply that the ethanol mandate, the renewable fuel standard, is a Central Planning scheme. Look, lenin and stalin at least had the intellectual humility to stop at fiveyear plans. This was a 17 year plan. As a result, 40 of the u. S. Corn crop is in effect free allocated preallocated to be burned in gasoline tanks. This artificially raises the demand for corn, hence the price for corn. Corn is one of the three main food staples in the world. Corn, rice, and soy. All of these staples compete for customers and land. When you raise the price of corn, you end up having repercussions throughout the global food system. What i had here was just a slide from a study by the center for regulatory solutions, that is part of the Small Business and after printer should counsel. Entrepreneurship council. They calculate for example that just in california over about 20 years, that the increases in food prices and also because ethanol impairs fuel economy, the increases in fuel purchases thats another cost would depress labor income by 18 billion. I dont think i have to go through the rest of it. You basically get the point. Heres a book that i think is wonderful. Also, read steves book. It argues the same basic thesis, although in very different ways. Its the moral case for fossil fuels. What alex epstein argues in this book is people producing and using fossil fuels did not take a safe climate and make it dangerous. It took a very dangerous climate and made it dramatically safer. This is one of my favorite charts that he sites. It was put together by a researcher at the interior department. It basically shows that in the 1920s, 472,000 people in the world perished from famine. Because famine reduced peoples access to food and water. Since that time, over one third of all the Greenhouse Gas emissions ever released entered the atmosphere, the world warmed up by almost one degree, yet faminerelated deaths declined by 99. 8 . If you look at it in terms of mortality rates, death per million, it was 99. 9 . This shows the fossil fuelbased civilization is highly sustainable. If it were unsustainable as the other side claims, this chart should be going in the other direction. You dont get a 99. 9 reduction in drought related debt from an Unsustainable Energy system. My point here is i guess im about to run out of time, so i should wrap up. My point is the main reason for this is that affordable, reliable, Plentiful Energy made the whole global Food Production system way more productive. Think of all the machinery that is used in farms today. They all run on fossil fuels. Irrigation systems all run on fossil fuels. Think about all the electrification and data management. A lot of that depends on fossil fuelgenerated electricity. Think about the transport of food from farms to cities or from fruit surplus areas to food deficit areas. Or just think about wealth in general. Wealth creation that allows for humanitarian assistance in the case of natural disasters. All of these capabilities and technologies are supported by fossil fuels. If we want to keep progress like that continuing, we should want to make sure that energy is as affordable as possible and not artificially raise the cost of it, which is what these policies are intended to do. I guess one more graph i will show, because this is really unbelievable. This is a chart put together by our good friend steve at the u. S. Changer of Commerce Institute for 21st century energy. And it shows what will be required to meet the Emission Reduction requirement for 2050 under the paris agreement. What it means is that in order to meet that target, todays developing countries will have to dramatically decrease their current projection of fossil fuels. Not just their future projections, but right now. If we assume that somehow miraculously developed countries like the United States reduce their emissions to zero by 2050, for the world to meet the paris agreements goal midcentury, todays developing countries will have to cut their Current Carbon backside Carbon Dioxide emissions by 35 . Realistically or unrealistically, developed countries only reduced their emissions by 80 by 2050, the developing countries will have to cut their current emissions almost in half. We are talking about an area of the world where more than one billion of people do not even have electricity. The potential for humanitarian disaster here for harming the poor, if countries are serious about implementing this program, is vast. With that, i will turn it over to ron. Thank you. [applause] ron thank you for the introduction and thank you for inviting me. I was here four different times in the past. More times than you, probably. I finally got it right and they let me stay and i actually retired. Talk aboutg to Government Programs that make housing unaffordable. Let me begin let me do this ok. Am i up . There we go. Let me begin by a quote how ah, there we go. Wrong button. Anyway, let me begin from a cover letter of ae report that was submitted, created, and written with the help of some heritage analysts in 1991. It was called the come commission. Kemp commission. In the cover letter to president bush, which is where the report was being submitted, jack kemp wrote, the commissions disturbing conclusion is discriminatory and unnecessary regulation constitute formidable barriers to Affordable Housing, raising costs by 20 to 35 in some communities. As a result, many lowerincome young families cannot find housing the other places of work and elderly couples cannot afford to live close to their relatives. This was done 26 years ago. It was called the kemp commission. Have things gotten better . Absolutely not. Despite the fact that, who could be afford to Affordable Housing . Particularly if it doesnt involve higher absolutely not. Taxes. In fact, many people are opposed to it. As i said, it has only gotten worse, largely because of additional zoning in the United States that has occurred over that period. The main reason it is not it has gotten worse is in large part due to the embrace of the Environmental Community over restrictive zoning, in what i call the war against the suburbs. About 20 years ago, they merged in the United States attached to the Environmental Movement. I call it the rise of smart growth, which restored the america. People lived much more closer to each other. They walked to work, the bicycle to work or took trolleys. Thats what they tried to do. Americans prefer to live somewhere else. Most want a singlefamily house, with a little bit of space and a little bit of privacy. That is gimmick and dream. That is the american dream. This disturbed progresses progressives in the Environmental Movement because people were behaving in ways they thought were irresponsible. They were using a land we could use for parks, agriculture. They were driving long distances to work. Driving long distances to buy food and go to restaurants and Wasting Energy and polluting the environment. And so, they began to look for ways to restrict people into tighter communities. By doing this, they used zoning essentially to discourage the expansion of suburban housing. Going back to who could be opposed to Affordable Housing and be in support of this, about 64 of the households in america who happened to be homeowners. The thing about restricting land is that anytime you restrict the supply something, the price rises. If you were existing homeowner, what is happening is his government regulations are enriching you. Your equity in that home rises. Pretty soon people realize these restrictions are worth a lot of money to them. An existingho has home is opposed to competition and new homes. So what you have is people who are essentially largely voting, the property owners, are the ones content to keep the system going. That is why it has been so difficult to alter it. 64 of american households are already homeowners. So, what do we care about the other people . People who have not moved into the community yet that youre keeping out dont get the vote in that community anyway. So you have a real problem here and it is getting worse. What i call antisprawl or landuse regulations that have become increasingly popular in the last 20 to 30 years. Portland, oregon in the 1970s drew essentially lines through all other cities in the state and said no growth can take place outside this boundary. It must be limited to agricultural purposes. All residential and commercial had to go within the growth boundaries. Portland went from being a very affordable place to being a very unaffordable place. People finally realized that referendums, which are popular in the pacific northwest, were used to undo and modify the growth boundaries so there is now some relief. Another way of restricting land is through service areas. Stafford county limits growth around the 95 corridor because they are not extending the sewage or water system beyond what they call the Growth Management area. Virginias a strong Property Rights state, so they cannot really prevent people from building outside. What we have is by right development. But that has to take place on a minimum size. You have to have a septic system and a well. So people they are buying their way out of these restrictive regulations and those who cannot are stuck in the corridor. Another way to do this moving on to the next is ok is through simple zonig. Zoning. Large lots. Loudoun county, these is the residence who had already got into Loudoun County were getting upset that more people wanted to come to Loudoun County. They were not happy with this because they wanted a certain level of policy and lack of privacy and lack of congestion but more people were following them because it was a Pleasant Place to live. So they essentially reserved the western portion of the county going out to West Virginia with large lot zoning. That meant the place is limited to either fiveacre lots, 10 acre lots, or 25 acre lots. So essentially they protected the wealthy set from the people who wanted to actually move there. The interesting thing is that people talk about unintended consequences. You cannot stop people from getting married and wanting to have a family and having children who want their own houses in the future. Population growth is inexorable, and so is housing. So what they have done is they have leapfrogged into West Virginia. One of the fastestgrowing washington suburbs is berkeley county, West Virginia. The people moving their are living moving there are living in virginia or washington , d c, and they are now driving probably 40 miles further to commute to work. We have had the opposite effect. Other ways of limiting housing growth, limiting it just to people who can buy their way out, you also determine what amenities must be in the house. You have some communities where all the housing must be brick facade or solid brick, which makes it more expensive. Lawns must be sodded. You must have sidewalks regardless of pedestrian traffic at all. And square footage. Are limited to a house that is smaller than 4000 square feet. Another popular form of limiting housing growth and rising prices and atari sprawl is impact fees. In many communities, Stafford County is not allowed to have impact fees. Any time someone wants the reason own their land for development, they say, whats the deal . In many cases in Stafford County, you have had instances where the price to get a zone for a house would be 25,000, developercourse, the the buyer,n to making housing more affordable. We do this by measuring what we call the median multiple. This is the ratio in any community of the median home price to the Median Income. Reconsider my colleagues who did quite it of work for the Heritage Foundation in the past. He considers anything over a multiple of three is not affordable. That is, Affordable Housing is if you can buy a house, a median house, at three times your income, which is traditionally what it has been in the United States. What has happened is the national average, which had been up to recently about 3. 0, is now 3. 9 throughout the country. But it very genetically from very dramatically from one community to the other. If you can see, we have some examples in california. California is probably being a very progressive state has the most severe land use regulations. They have had them since the 1960s and 1970s to disgorge discourage growth, or at least force people into cities and prevent them from going into the suburbs. Will me talk about a formal housing Affordable Housing as a multiple of three, in san jose, the median house costs 1 million. The median multiple is almost 10 times the Median Income in that very prosperous community. You think about all the young people who are coding at m. I. T. , and they are all excited to get a job at google or someplace. Theyre getting 120,000. They soon realize that he didnt apartment the sizable we had. The same thing for los angeles and san diego. They have strict regulations. The median multiple is 5. 5 times your income. Many people of modest income are priced out of the market. So let me just wrap up. 26 years later, a professor at m. I. T. Did a study of this. What he found was these costs are driven in large part but by artificial scarcity through landuse regulation. Thank you. [applause] thank you. Thanks for coming today. This is a really important project for us. I have worked in a lot of these regulatory areas that have been discussed. Also, food and Agricultural Policy. It became clear each time i was working on this issue areas, there are so many policies and regulations that drive up the price for consumers. The realities anytime a policy drives up the price for consumers, especially when it comes to need items like housing, gasoline, other energy it is going to be aggressive. You can safely assume it is good to be the case and it will have a disproportionate impact on the poor. That is one of the themes of this particular panel. I want to focus on food and agriculture. There are three policies i want to talk about. Two of them are a classic example of cronyism. Another is a classic example of arrogance. Cronyism. First, cronyism is a program that would make the soviet central planner blush. Central planning, onetoone, everything you can imagine in it limits how much sugar can be sold. It limits the imports into the country for sugar. The purpose of the program is to reduce the sugar supply and to drive up the price of sugar. Let me clarify. This is not an unintended consequence of a program. It is actually the goal of the program. Have an impact on the poor and all of us. So why do we have this federal Sugar Program . Why do we want to artificially drive up the price of sugar . To help a very small number of Sugar Growers and harvesters that exist. A lot of policymakers are helping these cronies at the expense of consumers. The cost to consumers is 3. 5 billion to 5 billion a year. They call it to the no cost to Sugar Program. Well 34 3. 5 billion is a cost. Just because it doesnt cost taxpayers money, it doesnt mean it doesnt cost us. We are the same people. Aty dont care, apparently the expense of the poor, we are going to help these cronies. But thats ok. Also, it comes at the expense of the much larger sugar using industry, the confectioners and many other manufacturers, including stable products, like bread. Aboutlly speaking, we pay double the price of sugar compared to the world price. Then it gets passed on to consumers. The other thing it does is it risks jobs. In a department of commerce a little old, but captures the point still. For every one sugargrowing threeng job, you lose confectionery jobs. The so that is your Sugar Program to help a very small interest group. The catfish farmers who are getting beat up by foreign a safetyon, there is reason. In 2008, as far as i know, there were no prices for catfish. Cdcish is considered by the and the fda as lowrisk food. The Government Accountability office, which is not known for using strong language, has repeatedly issued reports criticizing this program. It may have Given Congress a hint of what to do. One of the reports is this ram is shifting why is this a trade protectionist scheme . You have these Companies Providing catfish to the u. S. Countries will have to create a regulatory scheme that is equivalent to the ustas new regulatory scheme and it takes years to do this. Some countries may not even bother to create that kind of regulatory scheme. If they do, it will take a long time. So for that period of sun, there will be a monopoly for the domestic catfish farmers of america. The Senate Passed legislation last year, the congressional review act. Esolution the house did not pass it, even though 220 members begged leadership to pass it. The resolution would have in effect killed the program. 220 would have been enough to pass a resolution. Leadership can explain why they protect the cronies and not allow for a vote when you have that many legislators by the way, by patterson wanted to vote on the resolution. Theident obama called for ending this program. Pretty much everybody hates his program. This program hurts the poor, drives up prices. You are reducing the supply of a protein. This is extremely important. And again, hurting the poor. And getting to my third example is the arrogance example. Soda taxes. Really, to be more precise, tax on beverages. Far left havens like berkeley and San Francisco and boulder colorado have passed some soda taxes recently. The Philadelphia City Council Approved a sugar sweetened beverage tax, and that includes diet sodas. The whole point of a soda tax is to produce consumption. They reduce consumption by driving up prices as the whole concept. They will say the tax is not on the consumer, but on the distributor in the soda taxes. But the distributors will pass the retailers. And the city of philadelphia knows that is what happened. Their sticker shock going on there is sticker shock going on in philadelphia. Justf the things is not regressive the lower income population tends to drink sugarsweetened beverages than other households. What youre not going to see is a tax on crime related on cre me brulee. Its arrogance. Its not any business of the governance government to about having cakes of soda. The diet is very perplexed. Can buy a sugarscreens beverage and have a better diet because we can offset in one meal then in another. Someone can pick soda and why not cookies. Who in the world should tell us what is healthy and what is not. If people dont have enough information to make decisions on their own through private means. The diet industry is pretty big in this country. Big picture, cronyism is a common theme through these 23 policies identified in this report. The government is taking a very small winner at the expense of pretty much everybody else. And part of that everybody else is the poor. Thanks. We have a few minutes for questions if anybody out there has russian, raise your hand. We will call on you and bring a microphone to you. Write down here. You talk a lot about cronyism. Sugar, a smallut group of Sugar Growers in the United States make a contribution to the representatives and then create a program that provides those growers with higher prices and are a protected market. I wonder if corruption wouldnt be a better word to describe a program like this and if we are not sugarcoating it a bit. [laughter] i dont want to say it is corruption. It is part of our process. What happens in a lot of these issues, particularly in agriculture and the Sugar Program, is the added benefits of dispersed costs. Politicians know that these sugar protest Sugar Growers really care that these Sugar Growers really care about this program. Een bysts are not really said consumers. We buy car flicks it says here is how much are sugar tax was. That is one of the problems, like someone like me who works in agriculture, where the really care about and it iseir handouts hard to get the taxpayers to have the power or to have tonce to diss sway diss sway legislators to act accordingly. Any other questions . You included in your piece, one of the miracles of the free market is the gig economy. Particularly, in housing. Somebody who has a low, middle income person who utilizes websites like airbnb or br, bl, things like that that allow them to make significant money by renting out their space. Maybe you can touch on how some of these local municipalities or even states or even federal policies are potentially infringing on someones right to do that. The Hotel Industry argue that one advantage they have is that they are not paying occupancy taxes and we are. Occupancy taxes in the hotel is fairly substantial. It is anywhere between 10 and 15 of the room rate. They are arguing that airbnb people are offering the same Services Without pain the syntax. Without paying the same tax. Many communities are now requiring airbnb people to register with their activity and they are tracking them down because a lot of this takes place you pointed out who in your community is doing it. It is easy to find out who needs to be who needs to be paying taxes. This is happening, essentially, they are taxing it. There is also, it has worked so well that they are now thinking about moving from their want to longterm rentals, we can weekend rentals where if you have a spare house, you can become a boarding house effectively. If that takes off, that is also going to become a regulatory issue. Most communities in the suburbs limit the number of unrelated households that can live in a particular household. You can have all of your Adult Children living in your household and they can all have different cars but you can have but you cant have a bunch of adults were not related to in those communities. That could be the next regulatory issue battle in the housing area. This report is on the home sharing issue. We have a couple questions. We only have time for one more. You guys can fight it out. [laughter] i apologize if you covered this before i came in. But the new and ministration has great emphasis on american manufacturing, american products. The importance of preserving american jobs. Decidedly antiimport to kind of bent. Licy do you want to address, if you incomethe impact on low on consumers on cracking down on imports question mark i wish you had been here for this brilliant destruction of the policy. I hesitate to try to summarize what he said to do. It is quite obvious that a tariff is a tax. When you tax imports, you make them more costly. It will harm consumers but it will also harm manufacturers who use those imports as inputs to the production of other goods. It reduces the sales of goods in the United States, it means that foreigners have less money to spend and invest in the United States. It just inhibits Wealth Creation because it means resources are not flowing to the people who can use the most efficiently. There will be some very visible winners, but a whole bunch of less visible or even invisible losers. That is why the political system perversely prefers such policies 101 or one ofecon dons 12 are laws tells us that this is the way to reduce human welfare. Just add to that, with the Infrastructure Program, soon to be announced for a trillion dollars over 10 years or some amount, that Infrastructure Program and verily invariably becomes big targets of a market. There is a lot of by american step in the highway program. Communities are putting in light rail now. It becomes an american trolley car. Nobody makes trolley cars now comics it czechoslovakia. See lots and lots of that, especially with the pipelines being built. The pipes are made abroad. That was the premier of saskatchewan. He pointed out that the one fly in the ointment ofs approval of the Keystone Pipeline is this why american provision for pipeline. As brad warned, other countries are going to retaliate. Trade wars like having to pay so trade wars are destructive. Going back on the sugar subsidy, we are probably the only two were around back when that whole thing got started. It was during the reagan administration. What if particularly dead, that you dont mention in the paper very good paper, by the way but the whole Caribbean Initiative that matter reagan was inventing was a notion to try to make the islands in the caribbean selfsufficient. They had one agricultural product. Bella sugar. What we ended up doing was freezing them out of our sugar market which meant we had to give the more foreign aid. The whole thing was so goofy. They are in the secondtier, in addition to directly doing it by increasing the sugar. Thanks a lot. Thats a great point. It held the Central Florida area, the everglades. Traded lackcally market first odors i never thought i would say black market for fresca. But thank you for the point. Will you get a round of applause to our panel . We will head to a break. [applause] [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. Visit ncicap. Org] [captions Copyright National cable satellite corp. 2017] strategistslyrical discussed donald trump and how the mayfair in the humming elections. Here is a brief look. There are structural reasons why, for the foreseeable future, our ended its will. The label democrat and republican while im not saying there will be a serious Third Party Threat here, but what those labels mean is really what is up for grabs. And whether they mean anything at all is up for grabs. Our Political Parties are Like Department stores. Complicated, aggregations of a letter products and things. We live in an age when Department Stores are dying because people want to shop for just what they want, where they want to buy it. I think our parties are facing that, too. A lot of rich people, the koch brothers, on the right. We have the same thing on the left, tom steyer and george soros and other people. Andspecific Interest Groups issue groups. Those are dr
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