November 10, 2009 featuring David Boaz

" Freedom is in crisis and government is on the march that was the conclusion of Cato Institute executive vice president David bossi -- university of Rancho Bernardo California. Clothes laid out the events of recent years that he says demand to return to limited government and individual liberty. Learn more about -- university at Cato not a war."

" One of the things I have appreciated over the past ten years or so coming to events like this is that. People are nice enough to ask me if I have another book in mind. I wrote libertarian is in the primary and some of you know that's been translated into about ten languages and will soon come out and Italian and Chinese. And Spanish and on August -- in Spanish and Arabic. And it's just out in Persian so that's been gratified but I wanna tell you that I do now have another. Book and it's called tax tips for Democrat. And."

" I really think I can make more money on this one because it appears that there would be a big market for it on. I went around and I asked. Top Democrats in Washington. Why do you think Democrats need to know about taxes that they don't know. And I was very pleased with how helpful they were in giving me some ideas for instance I ask Charlie Rangel the chairman of the house Ways and Means Committee. What don't people know about taxes that they need to now. And he said people need to know that when you -- thousand dollars a night in rental income from your villa in the Dominican Republic you have to pay taxes on the so that's very helped. And then I asked Tom Daschle the former senate majority leader what. What do people need to know about taxes and he said well it turns out people don't know this. When a business associate gives you 80000 dollars as a consulting date you have to pay taxes on that. So that's a good thing you know and then I asked Tim Geithner the secretary of the treasury. What do you think people don't know about taxes and he says well it turns out that when your employer gives you extra money to pay your Social Security taxes and you sign a form acknowledging that's what the money is you actually have to pay the Social Security taxes so I think this could be a very important book. You know some people say the best thing about electing a democratic president is all the back taxes we collect from their appointees. Helped to balance the budget. But I really think Tom Daschle got treated very unfairly -- all of this he only paid his taxes in order to get a cabinet position. And then he didn't get the cabinet position so shouldn't they get his money back."

" Anyway I as Karl Marx would have put it that's the farce of what's been going on the rest of what I'll talk about is tragedy. Freedom is under assault in America. And I don't mean just the last six months we can certainly say at least the past eight and a half years we went through a lot in the past eight years. The excesses of the Patriot Act. The intrusion of the federal government into local schools. Local decisions on end of life and marijuana state marriage laws things that used to be the responsibility of states and local. Governments the biggest expansion of entitlements in forty years. Appealed to sharply curtailed Cold War political speech. The steady accumulation of power in the executive branch and in the person of the president. The assertion and exercise of the president's power. To arrest and incarcerate. American citizens without access to a law Europe or a judge. An increase in federal spending of more than. A trillion dollars and a near doubling of the national debt this is what the Washington Post look like four years ago this spring that was the Republican administration. And all of that before the last hundred days. People talk a lot about the first hundred days of a president FDR's first hundred days maybe LBJ's. Obama's first hundred days. But think about that last hundred days of the Bush Administration that was a scary time. The past nine months or so I think going back to September of last year. There's just been one assault on free market capitalism after another and back in September and October especially I think. That most of us were just feeling shell shocked by wind blow to the market after another. The federal takeover of Fannie Mae and Freddie Mac. The the bailout of AIG. The all power to Henry Paulson plan. The collapse of Washington Mutual. Congressional passage of the power to Paulson plus pork plan. The sharp drops in the Dow Jones average. The Federal Reserve -- unprecedented decision to lend directly to non financial companies the government partial nationalization of major banks. Paulson is announcement that he would use his bail out money for something other than what congress had voted to authorize. The auto bailout in direct defiance of a congressional vote and so on and so. And there was no time to fight these measures this was particularly frustrating for us and research organization. Most of them we're just announced is done deals every morning every Monday morning the secretary of the treasury would tell us what he in the Federal Reserve Chairman had been up to over the weekend. With the incumbent president in charge both presidential candidates going along and most of congress afraid to challenge the dire warnings of catastrophe it was impossible. To create any real political debate. Defenders of capitalism were really. And -- and adding insult to injury. We were greeted with claims that a problem caused by the Federal Reserve corporate tax law and federal housing regulation. Could somehow be blamed on the free market. Or indeed. Libertarian as. A column in Newsweek and slate said well this is that this is the fault of libertarian is as if libertarians. Had had some role to play in the Clinton and bush administration's. Atlanta up. To these problems. In fact of course. Big government causes massive problems and in demands more money and power to fix them again and again and again. And if the government can actually cause big enough problems to be a crisis. And so much the better. Robert higgs wrote a book called crisis and the -- Was about government growth. And one of the things he said was it is not the case. That government grows by 1% a year instead what happens is when there's a crisis like a war or an economic panic. The government sees is new powers. And sometimes after the war or the depression some of those powers get returned. To congress or the states or the people but never all that and you can Trace a lot of these specific programs and agencies. Two crises you can also Trace a lot of -- growth outstanding and the scope. A government. And then. A couple of years ago there was a best selling book by a woman named Naomi Klein called shock doctrine. And she made kind of the same point in political terms and getting it exactly backwards. But she did it make a point about crises and the way government gross. And she said the shock doctrine is a political strategy. That the Republican right has been perfecting over the past 35 years. To use for various different kinds of shocks. They could be wars natural disasters economic crises. Anything that sends a society into a state of shock to push through what economists call economic shock therapy. Policies that they couldn't get through with people words in a state of fear and panic. And she has a point. Think back to nine elevenths 9/11 was shocked to the American system and what happened after nine elevenths what did we get when we got the Patriot Act. We got the federalization of airport screeners we got the Department of Homeland Security arguably we got. The war in Iraq all as a result of the shock of nine elevenths. But deregulation. Free markets. That's what Naomi Klein's theory would predicted -- get that. Governments take advantage of crises to amass more money and power. Jonathan chase who's a writer for the new republic the liberal magazine actually wrote a devastating critique. The shock doctrine he thought it was -- bad and things he said was she says. Republicans conservatives people on the right use the shock doctrine but in fact he said people on the left Houston as well. And it was just wonderful quote in there he said liberals could not yet enacted the new deal without the Great Depression. Communist revolutions have generally come about in the wake of wars. The liberal economist victor -- once wrote that national health insurance will probably come to the United States. In the wake of a major change in the political climate the kind of change that often accompanies a war depression or large scale civil unrest. On -- now I wouldn't dare to equate the new deal and national health insurance with Communist revolutions. But this writer for the new republic said well -- three examples of people on the left to use the shock doctrine the new deal Communist revolutions and national health insurance so okay if the if the new republic thanks a Communist revolution is sort of like the new dealer national health insurance I guess I. I don't have to argue with them. So 9/11 gave us an example that you might say confirmed what Naomi Klein says. And then we got the economic shocks of 2008. And what happened. Did the Republican administrations summon up the spirit of Milton Friedman and cut government spending -- deregulate and privatize. As Naomi Klein would've suggested. Of course not. He did what governments actually do and a crisis it's ceased new powers over the economy. It dramatically. Expanded. The regulatory powers of the Federal Reserve and injected a trillion dollars of inflationary credit into the banking system. It partially nationalize the biggest banks in appropriated 700 billion dollars with which to intervene in the economy. It may General Motors and Chrysler wards of the federal government it wrote to bail out bill giving the secretary of the treasury extraordinary. Powers. That could not be reviewed by courts or other government agencies. And now. The Obama administration. Which promised hope and change is doubling down. On all the bush programs doubling down on the bailouts. But Clark. The ownership of the automobile companies what are we getting from Obama. Hundreds of billions of dollars. Trillions of dollars. Of spending. And its key players are explicitly. Referring to their own version of the shock doctrine. Rahm Emmanuel the chief political fix are in the administration. Goes on national television and says the economic crisis facing the country is an opportunity for us. After all he said you never won a serious crisis to go to waste and this crisis provides the opportunity. For us to do things that you could not do before. Such as taking control of finance energy education and healthcare. They are not even embarrassed about their use of the shock doctrine their proud and subsequent to his saying it and some people criticizing. Hillary Clinton went to Germany and made exactly the same point you never want a serious crisis go to waste and then Joe Biden said it. And then president Obama's -- in one of his weekly radio addresses and those things are not spontaneous they're not off the cuff. This was the entire Obama administration. Put its collective thinking together and had him go on national radio and say we wanna use this crisis. To get what we want. These days. We continue to get these scary headlines. Detroit's fate sealed in west wing while that tells you that shelf in. American economic power. Economic influence the economy has shifted from Wall Street and Detroit to Washington and also. Under the radar. This administration. Things that would not be in the headlines. This administration is pushing assaults. On 401 -- HSA is because they don't want you to save for your own retirement your own health care they want you dependent on them they're pushing too. Reverse workplace flexibility rules. Because they want the rules of the workplace decided by unions and government not -- negotiations between workers and their companies. They are stepping up anti trust cases they're creating -- pays -- hours to decide how much people should get paid. The Wall Street Journal but I read on the airplane coming out here at a front page story about the pays are getting his office set up and getting ready. To start overseeing all the salaries and all the companies that have taken some money from the government which you would hope would be a lesson to companies don't take money from the government. But not many of them have learned it and we talk we have talked this weekend. This week about. The rule of law versus the rule of millions. So I read this article on the pace -- you know. It's not a painful. It's not a task force it's Kenneth Feinberg. It's not the rule of men that is replacing the rule of contract. It is the rule of man. So let us hope that Kenneth Feinberg. Is a generous merciful and incorruptible bureaucrat. Because heat we'll decide how much money people make at major American companies it's not the rule of law it's not the rule of mean and it's the rule of eight man. And they have a list of tax hikes as long leisure arm that's still won't save us from the trillion dollar deficits they're talking about. But at least they do occasionally give us some comic relief I like these headlines. Civil servants are going to spend stimulus funds quickly but wisely well that should be fun to watch. And actually since this headline appeared we have been watching it they're not spending them quickly and yet they're still not spending -- wisely. Well as I said I think that for a long time lots of us were just shell shocked at the daily barrage of assaults on economic freedom. And there were two other factors that I think have been hampering the freedom movement. First. Too many small government advocates always felt some kind of ambivalence. About taking on the Bush Administration. Somewhere in their minds they still had this theory that Republicans really do believe in smaller government and free markets. No matter how many trillions in new spending they run or how many Americans they incarcerate without access to a lawyer. And that misperception limited libertarians. Ability to organize a broader freedom movement to oppose the actions of the Bush Administration. And second. Jury my height of the financial crisis some businesspeople and even some free market economists. Felt uncertain about opposing the emergency measures being taken by Henry Paulson and Ben Bernanke one economist actually told me. If Bernanke has seen all the data and really feels this is necessary I'm inclined to believe him. So that was a challenge to organize opposition. But that is all over now smaller government folks feel no hesitation about vigorously taking on the Obama Reid Pelosi government. And instead of financial rescue package which was indeed complicated. Instead of that we moved on to debating an old fashioned keynesian throw money at the problem kitchen -- spending bill described as economic stimulus. And most free market economists felt no ambivalence about opposing that dale. John Cochran of the University of Chicago dismissed it by saying. The premise of a fiscal stimulus is that Americans do not borrow enough and do not spend enough. Good point Robert Barrow of Harvard called it probably the worst bill that has been put forward since the 1930s. And the reaction. To this so called stimulus bill I think may have been the beginning of the Renaissance of the free market movement. Freed from the burden of fielding some connection. To -- big government Republican president Republicans voted overwhelmingly against this bill in both houses of congress. And libertarians played leading roles in galvanizing the opposition. The Cato Institute -- full page ads in every major newspaper in the country with the names of more than 200 economists to quote. Do not believe that more government spending as a way to improve economic performance and while. The ad was talked about on television was waived by Republican senators at a press conference. And seemed to energize free marketers who felt that their voice. Had not been heard in national debates over the past few months. And a long -- if -- those ads which I think did help to. Re energize the premarket movement other libertarians were busy too. Americans for prosperity had an online petition for people to sign. A lot of libertarians were among the leaders of the tea parties around the country freedom works is planning a tax -- march on Washington for September. The good news is the freedom movement is back in -- The bad news is that's because the welfare state is on the march and people feel under assault. But we have faced dark days for American freedom before. Think about the first great fight for American freedom the American revolution. Think about the wonderful year 1776. Thomas Jefferson wrote the declaration of independence the united colonies issued this great document summoning Americans to fight. For American freedom. What a wonderful July that wise. And yet by December of Thomas Paine. Was riding. These are the times that try men's souls. The summer soldier and the sunshine patriot will in this crisis shriek from the service of their country. But he bits stands by it now deserves the love and thanks of man and woman. Things didn't look so good. And just a year later just before Christmas of 1777. George Washington's army took up winter quarters at valley forge. Then came a cruel race with time to get putts erected before the soldiers bare foot and half naked starved or froze to death. Hundreds of horse is actually did starve to death."

" But we won that like. And then there was the fight against slavery and institution that had existed from time immemorial in virtually all parts of the world. Until the rise of libertarian ideas in England and America created a movement for abolition is. And we've all read the horrors of the middle of the middle passage and the regime of legalized violence to sustain slavery on the plantation. Reports and novels about the reality of slavery helped to change people's lines. But the fundamental principle. That motivated the abolitionist was liberty that's abolitionist Frederick Douglass. There's a banner -- was a lot of biblical imagery in this proclaim liberty throughout all the land unto all the inhabitants there off. Frederick Douglass William Lloyd Garrison -- and Angelina -- keep the important famous abolitionist. All stressed the fundamental principle of liberty and specifically. The fundamental libertarian principle of self ownership every person owns. Himself Angelina -- he wrote. The great fundamental principle of abolitionist and is that man cannot rightfully hold his fellow man as property. Therefore we affirm that every shareholder every slave holder is a man stealer. A man is a man and as a man he has inalienable rights among which is the right to personal liberty. And compared to the hardships of valley -- and plantation slavery. The new deal may seem a minor problem. But it did present a fundamental challenge to economic freedom and constitutional government. There's a picture of Roosevelt signing one of -- unconstitutional. Bills I don't actually know which one but they were all unconstitutional. So it's one -- In the 1930s. Americans were confronted with a claim that the market has failed. With a crisis atmosphere. With pseudo solutions passed in and it all of which may sound familiar to us these days. And the four runners and founders of the libertarian movement reacted in horror. Two things like the NRA and the accretion of executive power in the new deal. Frank Knight told I act that the new deal represented a general movement of west European civilization away from liberalism to authoritarianism. Henry Simon's feared that the basic values of civilization would be lost. Isabel Paterson said it wasn't correct to say that the new deal is like fascism the new deal is fascism. And then after. Twelve years of depression in new deal and came the war. Joseph Sharon Peters said thinking about the new deal and likely effects of the war. Cannot help feeling that this will be the end of the American way of life. And and we get to the year 1943. Errors the map of Europe. The ran on the right the Soviet Union controlling part of Europe. The blues shows Hitler in control of Europe from Stalingrad in North Africa to the English Channel. And imagine being a friend of freedom in that year. And yet in that dark and terrible year a few people did stand up. In 1943. Is -- bill Paterson rose wilder lane. In particular line -- stood up. Wrote -- important books launched the libertarian movement would not be silent in the face of overwhelming. Intellectual. And and and national sentiment. In favor of what was going on. The next year. Friedrich Hayek wrote his great book the road to serfdom which had a greater impact on intellectuals. Lots of young students and academics read this book. And rallied to an intellectual movement for freedom. That was somewhat different from the movement that Rand novels and the nonfiction books and Elaine Patterson. We're attracting and then Leonard read in 1946 as the war ended launch the first free market think tank. The foundation for economic education. And now freedom is under assault. Again. These are the things we're dealing with today. Stayed -- is on the march helped along once again by an atmosphere of crisis and panic. And it's easy to get discouraged and it's easy to let the immense that the of the challenge stop us. But he didn't stop Thomas Paine it didn't stop Frederick Douglass. It didn't stop Murray Roth partisan bill Patterson nine -- Friedrich --"

" And it won't stop bust this is some of what Cato Institute scholars have been doing over the past nine months."

" With all due respect Mr. President it is not true that there is a consensus in favor of these. Programs."

" And speaking of summer soldiers and sunshine patriot says Thomas Payne was a moment ago. A couple of months ago I was joking with some free market economists who declined to sign our aunt and I understand that some people don't like to sign other people's writing they don't like to sign manifesto as they say I do my own writing when I have something to say I say it myself. I understand that position. But I still said 21 of them some day you'll be sorry your name isn't on this roll of -- And I quoted to him the saint Crispin -- speech from Shakespeare's Henry the fifth. We few we happy few we band of Brothers. Four he today that sheds his blood with me shall be my brother. And gentlemen in England now a bad judge shall think themselves a -- they were not here. And hold their manhood cheap while when he speaks that fought with us upon saint Christians today."

" This challenge will not stop us. And I know it won't stop you. We at the Cato Institute face two challenges today we face the challenge of welfare state -- on the march again. And we faced a challenge that that very state has destroyed much of our wealth. And to those of you who have continued to support the Cato institute and the freedom movement. During these tough economic times we are enormously grateful thank you very much."

" More than 200 years ago Thomas Jefferson and the other signers of the declaration of independence. Committed themselves to the cause of American liberty with these words. And for the support of this declaration with a firm reliance on the protection of divine Providence. We mutually pledge to each other our lives our fortunes and our sacred honor. And they weren't kidding they knew that if they did not all hang together and possibly even if they did they would certainly all hang separately. Twelve signers in fact had their homes ransacked and burned by the British. Nine more died from wounds or hardships of the revolutionary war none however lost his sacred honor. And you know we talk about the statesman and the military leaders and the philosophers. Who made us free. But -- work was made possible by the farmers and the merchants and the printers and the people who provided the kinds of support without which those great deeds could not have been done. The struggle for freedom has never relied entirely on geniuses and heroes. Think about the Quaker merchant Benjamin parolee who provided money and lodging for John Locke and William hand when they needed it. Or Elizabeth Cady Stanton housewife and mother who spent fifteen years campaigning for women's rights. The great libertarian campaigns for free trade and the abolition of slavery. Depended not just on their leaders and orators and on thousands of pamphlet -- contributors. Precinct walkers and antelope stoppers. And today it's even more convenient you can stuff envelopes in the privacy of your email account. No one will demand our lives or our fortunes if we speak out. All we have to do is write letters to our public officials. And letters to the editor. And speak out at public meetings. You're members of congress are all going home for a month long recess to find out what the American people think about health care. They will be appearing at public meetings. Why don't you go and tell them what the American people think about the idea that you can provide more health care to more people. Through the people who run the post office and save money in the process. Or you can speak up against subsidies and regulations in your trade associations and chambers of commerce. You can give a book to a friend give money to a Canada join a group working for tax cuts or school choice. If the government treats you unjustly you can take them to court. And if you don't get satisfaction soon enough you can take them all the way to the Supreme Court as Gail Atwater did. Gail Atwater took. Gail Atwater was arrested handcuffed and taken off to jail for the crime of not wearing a seatbelt. She thought that didn't sound like a reasonable seizure under the Fourth Amendment and she took it all the way to the Supreme Court and I regret to say she lost. At the Supreme Court level so did -- that -- low so did Dred Scott and homered plessy. But some of those causes went on to win -- stand up take about."

" Freedom depends on some people not taking it lying down. If you haven't seen the video at the Cato institute's web site of -- that he -- talking about what happened to her house you should go and look at it. She is not a published pop polished public speaker. But when she looks directly into the camera and says my name is is that he low and the government stole my home. She's a powerful public speaker. We can do all those sorts of things. And I would be remiss if I didn't ask you to devote some portion. Up your fortune. To the cause. Because we know that freedom isn't free. And so -- end tonight with this statue. That stands at the center of Chicago. This middle of that enterprising city. Paul butcher for the world tool makers backer of wheat if we were writing that point today we would add applicator of capital for the world. And this statute shows George Washington flanked by two man. Who helped him make the American revolution. Robert Moore is in high in -- they -- not very famous. All they did was provide the funding. But kept Washington's troops in the field and kept men like James Madison in the continental congress in Philadelphia. And so I like to think of this statue as a symbol of our partnership and our commitment. To the cause of freedom. And a reminder. That we must not fail to live up to -- example. Thank you and good night."

" David closes executive vice president of the Cato Institute you can read more of his work at Cato that'll work."