1 00:00:18,480 --> 00:00:21,359 Speaker 1: And we are back with another edition of the Federalist 2 00:00:21,440 --> 00:00:24,879 Radio Hour. I'm Matt Kittle, Senior Elections correspondent at the 3 00:00:24,920 --> 00:00:29,640 Federalist and your experience Shirpa on today's quest for Knowledge. 4 00:00:29,960 --> 00:00:32,960 As always, you can email the show at radio at 5 00:00:33,000 --> 00:00:37,399 the Federalist dot com, follow us on x at FDR LST, 6 00:00:37,960 --> 00:00:40,799 make sure to subscribe wherever you download your podcast, and 7 00:00:40,920 --> 00:00:44,000 of course to the premium version of our website as well. 8 00:00:44,439 --> 00:00:49,079 Our guest today is Anne Rathbone, Bradley George and Sally Mayer, 9 00:00:49,200 --> 00:00:53,520 Fellow for Economic Education, vice president of Academic Affairs at 10 00:00:53,520 --> 00:00:57,640 the Fund for American Studies and economic professor at the 11 00:00:57,719 --> 00:01:01,679 Institute for World Politics. And thank you so much for 12 00:01:01,759 --> 00:01:04,000 joining us in this edition of the Federalist Radio Hour. 13 00:01:04,319 --> 00:01:05,560 Speaker 2: Matt, thank you for having me. 14 00:01:06,159 --> 00:01:10,280 Speaker 1: Absolutely as we talk, New Yorkers are heading to the 15 00:01:10,319 --> 00:01:16,239 polls and they're going to vote for a few different candidates, 16 00:01:16,239 --> 00:01:19,319 but it seems the front runner, certainly is this Zoran 17 00:01:19,480 --> 00:01:23,799 mom Donnie, the Socialist candidate for New York City mayor, 18 00:01:24,239 --> 00:01:26,560 and he wants the Big Apple to go into the 19 00:01:26,599 --> 00:01:31,719 grocery store business. Mom Donnie's proposed pilot program aims to 20 00:01:31,760 --> 00:01:37,159 open five groceries, one in each borough, funded and operated 21 00:01:37,560 --> 00:01:41,719 by the city, funded by the city and its taxpayers. 22 00:01:41,760 --> 00:01:45,920 Of course, what could possibly go wrong? Man, what could 23 00:01:45,920 --> 00:01:46,959 possibly go wrong? 24 00:01:48,200 --> 00:01:53,280 Speaker 2: Well? Everything is that to doomsday of an answer? No, 25 00:01:53,480 --> 00:01:54,040 not at all. 26 00:01:54,159 --> 00:01:58,280 Speaker 1: You write a great op ed in the Washington Post 27 00:01:58,319 --> 00:02:03,159 and you refer to we have some history here behind us. 28 00:02:03,879 --> 00:02:07,120 The old Soviet Union can tell you all about that, 29 00:02:07,280 --> 00:02:13,120 the failed experiment of state run you know, enterprises. 30 00:02:13,800 --> 00:02:17,039 Speaker 2: Yes, we have a lot of history here, and I 31 00:02:17,120 --> 00:02:21,680 think knowing the history and just really knowing some of 32 00:02:21,719 --> 00:02:26,719 the basic principles of economics is really helpful in terms 33 00:02:26,759 --> 00:02:31,560 of cutting through policy proposals that sound very good on paper. 34 00:02:32,280 --> 00:02:37,159 So in some sense I can very much understand why 35 00:02:37,199 --> 00:02:40,240 he would run on this platform, because there's nothing better 36 00:02:40,280 --> 00:02:47,439 than free things, and politicians who promise free things, you know, 37 00:02:47,639 --> 00:02:50,240 Santa Claus, if you will, that sounds really good to 38 00:02:50,319 --> 00:02:53,240 voters in a city like New York, New York City, 39 00:02:53,240 --> 00:02:56,400 where groceries are very expensive, it's very expensive to live, 40 00:02:56,439 --> 00:02:59,719 it's expensive to commute. So there's real, you know, in 41 00:02:59,800 --> 00:03:02,919 my call them pocketbook anxieties that are f by not 42 00:03:03,080 --> 00:03:05,080 just member you know, as citizens of New York City, 43 00:03:05,680 --> 00:03:09,080 across the country. But I think we have to have 44 00:03:09,199 --> 00:03:12,759 kind of sound reason to understand whether the things that 45 00:03:13,120 --> 00:03:17,319 sound good achieve good and that's where economics comes in. So, 46 00:03:17,400 --> 00:03:20,319 as you mentioned, I mean, this is not a new idea. 47 00:03:20,439 --> 00:03:24,560 The Soviet Union not only you know, ran state grocery stores, 48 00:03:24,599 --> 00:03:28,080 but every kind of store, and so the results of 49 00:03:28,080 --> 00:03:31,560 that were catastrophic in terms of prosperity, in terms of 50 00:03:31,599 --> 00:03:34,800 well being, in terms of just standards of living and 51 00:03:34,840 --> 00:03:36,919 being able to put food on the table every day. 52 00:03:37,000 --> 00:03:40,400 And so I think the problem is maybe you know, 53 00:03:40,479 --> 00:03:43,680 kind of gen Z and younger generations who I think 54 00:03:43,719 --> 00:03:47,240 are the ones that are excited about these ideas, perhaps 55 00:03:47,280 --> 00:03:49,919 they don't, you know, we haven't taught them the historical 56 00:03:50,000 --> 00:03:53,120 lessons of the Soviet Union. What's happening in Venezuela today 57 00:03:53,159 --> 00:03:55,919 is another example. But I also think maybe we haven't 58 00:03:55,919 --> 00:03:58,560 taught them how to apply some very basic principles of 59 00:03:58,599 --> 00:04:02,199 economics to understand that this is a feature and not 60 00:04:02,360 --> 00:04:05,319 a bug. That's what I want people to know is 61 00:04:05,319 --> 00:04:07,639 that it's not like, Okay, well in New York City 62 00:04:07,719 --> 00:04:09,840 is a very prosperous city. It's one of the best 63 00:04:09,840 --> 00:04:12,599 cities in the world. It's kind of an image, iconic 64 00:04:12,639 --> 00:04:15,439 image of American capitalism. And so we're the good guys. 65 00:04:15,479 --> 00:04:17,240 And so if the good guys decide we're going to 66 00:04:17,439 --> 00:04:21,040 run city on grocery stores, then somehow we'll get good outcomes. 67 00:04:21,279 --> 00:04:24,920 And that's just wrong. And so this will fail the 68 00:04:25,000 --> 00:04:27,759 same way that it failed, you know, in the Soviet 69 00:04:27,800 --> 00:04:30,160 Union for eighty years, and the way that it's failing 70 00:04:30,199 --> 00:04:33,759 in Venezuela and Cuba today. It just doesn't work, and 71 00:04:33,800 --> 00:04:35,519 I think we need to know that, so we don't 72 00:04:35,600 --> 00:04:38,800 kind of dish out these these promises that are false. 73 00:04:38,879 --> 00:04:39,959 They're false promises. 74 00:04:40,720 --> 00:04:42,680 Speaker 1: This is a great line from your column again in 75 00:04:42,680 --> 00:04:46,560 the Washington Post. The cruel joke of socialism is that 76 00:04:46,600 --> 00:04:51,720 it always starts with free stuff and ends with no stuff. 77 00:04:52,480 --> 00:04:56,720 Not only is there no free lunch, there is no lunch. 78 00:04:57,639 --> 00:05:01,480 And again I draw back to the examples of Boris 79 00:05:01,560 --> 00:05:07,240 Yeltsin and khrus Chef, one in the late eighties, the 80 00:05:07,279 --> 00:05:11,759 others in the nineteen fifties, both visiting the United States, 81 00:05:12,120 --> 00:05:17,480 both at supermarkets different cities in the United States, and 82 00:05:17,600 --> 00:05:24,319 both marveling that these grocery stores had more products in 83 00:05:24,360 --> 00:05:29,800 there than would be available to the leaders of the 84 00:05:29,839 --> 00:05:34,360 Soviet Union. That's what New Yorkers are rolling the dice 85 00:05:34,439 --> 00:05:35,240 on here, isn't it. 86 00:05:35,800 --> 00:05:38,120 Speaker 2: That's correct, That's right, And I think the way you 87 00:05:38,160 --> 00:05:41,800 put that is just it's such a powerful lesson. I mean, 88 00:05:42,360 --> 00:05:46,839 in particular, drawing on Yeltsin's experience, this really had a 89 00:05:46,879 --> 00:05:49,720 profound impact on him. And you have to think about 90 00:05:50,279 --> 00:05:56,600 Yeltsin was an establishment communist, right like a Marxist foot 91 00:05:56,680 --> 00:05:59,240 soldier in the political class. This is not a person 92 00:05:59,360 --> 00:06:04,079 who it was like toying with capitalism or free markets. 93 00:06:04,759 --> 00:06:08,160 And so coming to the United States and asking to 94 00:06:08,319 --> 00:06:11,399 visit a grocery store. He visited Randall's grocery Store, which 95 00:06:11,480 --> 00:06:14,560 is a chain I believe that still exists today. He 96 00:06:14,680 --> 00:06:18,279 was in Clearwater, Texas. I believe they had just recently 97 00:06:18,319 --> 00:06:21,959 been at the Johnson Space Center. And the word that 98 00:06:22,040 --> 00:06:25,720 you used is so important, Marvel. That is a word 99 00:06:25,759 --> 00:06:30,519 that Fa Hiek Nobel Prize economist and staunch defender of 100 00:06:30,759 --> 00:06:36,600 capitalism against the socialists used to explain what happens in 101 00:06:36,759 --> 00:06:39,720 market economies. And it's the idea that no one is 102 00:06:39,759 --> 00:06:44,519 in charge, there's no grocery stores are that can figure 103 00:06:44,560 --> 00:06:47,680 out how many even varieties of Apple's need to be 104 00:06:48,199 --> 00:06:52,199 in the grocery store on November fourth, twenty twenty five. 105 00:06:52,279 --> 00:06:55,240 Nobody kind of really knows that answer, right, especially not 106 00:06:55,319 --> 00:07:00,600 ahead of time. And so I think that's what really 107 00:07:02,040 --> 00:07:06,480 amazed Yeltsin And here's why I think it should amaze us, 108 00:07:06,519 --> 00:07:09,199 but it doesn't. And it's, you know, we get we 109 00:07:09,680 --> 00:07:13,480 are so wealthy in the United States that it's very 110 00:07:13,600 --> 00:07:17,000 ordinary going to the grocery stores an ordinary experience. You 111 00:07:17,040 --> 00:07:19,839 put it on your to do list, you're happy to 112 00:07:19,839 --> 00:07:21,879 cross it off. I mean, I like grocery shopping, but 113 00:07:21,920 --> 00:07:24,839 not everybody does, right. Some people even outsource this to 114 00:07:24,959 --> 00:07:28,680 instacart or something like this, So it's just so mundane. 115 00:07:29,120 --> 00:07:31,959 But when you don't have access to grocery stores again. 116 00:07:32,000 --> 00:07:34,759 In nineteen eighty nine, yeltsin Is is the member of 117 00:07:34,800 --> 00:07:37,680 the elite political class about to take over the country, 118 00:07:38,040 --> 00:07:40,600 and he says he marvels at what he says, and 119 00:07:40,759 --> 00:07:45,639 he actually says that it makes him both overwhelmed and depressed. 120 00:07:45,879 --> 00:07:49,480 Overwhelmed because he just didn't realize that it was possible 121 00:07:49,959 --> 00:07:55,240 that that amount of abundance could be available to ordinary people, 122 00:07:55,360 --> 00:08:00,480 not political elites, not just wealthy people, but ordinary you know, 123 00:08:00,920 --> 00:08:04,759 Mom's grocery shopping with Boris Sielson on Tuesday, right. This 124 00:08:05,439 --> 00:08:09,959 amazed him and he says that he's depressed because, you know, 125 00:08:10,040 --> 00:08:12,759 this was the quest, this was the promise of socialism. 126 00:08:13,360 --> 00:08:16,399 It's always the promise that the stores will be full, 127 00:08:16,639 --> 00:08:20,639 the shelves will be stopped, and there's no lunch, as 128 00:08:20,639 --> 00:08:23,639 you mentioned, as I mentioned in my article, there's nothing. 129 00:08:23,680 --> 00:08:26,279 People stand in line for hours, they can't get what 130 00:08:26,319 --> 00:08:28,800 they want or what they need. They're forced to barter 131 00:08:28,959 --> 00:08:31,959 on the street. I mean, nobody wants to grocery store 132 00:08:32,159 --> 00:08:34,600 or grocery shop in that manner, but that's always the 133 00:08:34,600 --> 00:08:35,559 predictable result. 134 00:08:36,440 --> 00:08:38,720 Speaker 1: Yeah, well they should have taken into a costco that 135 00:08:38,759 --> 00:08:43,759 would have read, oh yes, flipped his mind absolutely. I'll 136 00:08:43,799 --> 00:08:47,879 tell you what makes me a bit overwhelmed and certainly 137 00:08:47,960 --> 00:08:52,399 depressed is a poll that found sixty two percent of 138 00:08:52,440 --> 00:08:59,519 Americans aged eighteen to twenty nine hold favorable views towards socialism. 139 00:09:00,480 --> 00:09:06,600 And that has to speak to our educational system we in, 140 00:09:08,200 --> 00:09:13,679 certainly in public education, I think we're failing to drive 141 00:09:13,799 --> 00:09:18,960 home those lessons of long breadlines in the Soviet Union 142 00:09:18,960 --> 00:09:25,279 and Soviet controlled countries what central control can do. And 143 00:09:25,679 --> 00:09:29,360 I'm worried about this grand old republic, this grand old 144 00:09:29,399 --> 00:09:30,519 experiment of ours. 145 00:09:31,440 --> 00:09:37,080 Speaker 2: I share those concerns when you look at how far 146 00:09:38,240 --> 00:09:40,879 we have come. Just thinking about again the grocery store 147 00:09:40,919 --> 00:09:43,919 as the example, just what is in your average grocery 148 00:09:43,919 --> 00:09:48,080 store today compared to when Yeltsin visited and then compare 149 00:09:48,120 --> 00:09:50,919 that to nineteen fifty nine when Christ Jeff visited. So 150 00:09:51,080 --> 00:09:56,120 it's just the bounty is just mesmerizing, but again to 151 00:09:56,240 --> 00:10:00,919 us ordinary mundane, boring maybe, And so I think we 152 00:10:00,960 --> 00:10:03,840 take that for granted and we think, Okay, I live 153 00:10:03,879 --> 00:10:07,120 in a very expensive city. I want the politicians to 154 00:10:07,240 --> 00:10:10,720 do something about that. And so socialism sounds like a 155 00:10:10,759 --> 00:10:12,759 great idea. But you know, we're not going to have 156 00:10:12,840 --> 00:10:14,720 the force, We're not going to have the famines, we're 157 00:10:14,720 --> 00:10:18,879 not going to have the authoritarian violence. We won't have that. 158 00:10:18,919 --> 00:10:21,799 We'll have kind of a kinder, gentler socialism, if you will. 159 00:10:21,840 --> 00:10:25,559 And I think that's what you know, eighteen to twenty 160 00:10:25,679 --> 00:10:28,159 nine year olds are, that's what they want. They don't 161 00:10:28,240 --> 00:10:33,360 want a labor camps. They want things that are affordable. 162 00:10:33,399 --> 00:10:35,639 They want to, you know, graduate from college and be 163 00:10:35,679 --> 00:10:38,080 able to afford an apartment and get a job and 164 00:10:38,080 --> 00:10:40,639 buy their groceries. And I think that's all very reasonable, 165 00:10:41,080 --> 00:10:43,960 and I think we all should but I think we 166 00:10:44,159 --> 00:10:48,480 do share those concerns. I think the the trick in 167 00:10:48,600 --> 00:10:52,519 socialism is that again, like I said, it's the false promise, 168 00:10:52,600 --> 00:10:56,159 but the promise to sounds so exciting that you're willing 169 00:10:56,200 --> 00:10:58,519 to make a bet on it. And if you find 170 00:10:58,559 --> 00:11:01,279 someone's charismatic that can, you know, kind of make it 171 00:11:01,320 --> 00:11:04,159 sound like it's all benefit and no cost, then of 172 00:11:04,200 --> 00:11:07,279 course why wouldn't you vote for it? It sounds like, well, 173 00:11:07,360 --> 00:11:09,440 let's just give it a try. And he's only talking 174 00:11:09,480 --> 00:11:12,600 about five grocery stores. As you said in your opening, 175 00:11:12,639 --> 00:11:14,480 you know what could go wrong? Well, I actually think 176 00:11:14,519 --> 00:11:17,320 a lot could go wrong. I think we could disrupt 177 00:11:17,360 --> 00:11:19,679 the local economy. And I think what we have to 178 00:11:19,759 --> 00:11:22,399 keep in mind, and younger generations have to keep in mind, 179 00:11:22,440 --> 00:11:26,000 is that even governments face scarcity, they have budgets, and 180 00:11:26,039 --> 00:11:30,720 so there's a limited amount of money in any city's budget, 181 00:11:30,799 --> 00:11:33,759 and if they're going to direct money at one thing today, 182 00:11:34,000 --> 00:11:37,600 it means there's less money to direct at other things today, 183 00:11:38,000 --> 00:11:40,600 and so there's real opportunity costs in doing this. So 184 00:11:40,639 --> 00:11:42,440 I think, not only do we have to look at 185 00:11:42,440 --> 00:11:44,720 this fails because we're not going to be able to 186 00:11:44,799 --> 00:11:48,120 keep the shelves stocked, We're going to have theft problems, 187 00:11:48,960 --> 00:11:51,360 we're going to have endurance problems. Just how can we 188 00:11:51,480 --> 00:11:55,000 keep it open? And because what's missing is the profit motive, 189 00:11:55,080 --> 00:11:59,399 that's what makes this work in the market economy. And so, 190 00:11:59,559 --> 00:12:03,879 you know, I think we need to keep talking to 191 00:12:04,080 --> 00:12:05,879 younger people in the classroom. I spend a lot of 192 00:12:05,879 --> 00:12:08,279 time in the classroom, and you know, we start when 193 00:12:08,320 --> 00:12:11,639 I teach economics, I start with the human person. What 194 00:12:11,759 --> 00:12:15,039 is our anthropology? Right? We face scarcity, we're limited, we 195 00:12:15,080 --> 00:12:18,039 need each other, we have to find ways to cooperate, 196 00:12:18,080 --> 00:12:20,679 we're self interested all these things. Well, if that's true 197 00:12:20,720 --> 00:12:22,200 of you and me, then it's true of all these 198 00:12:22,240 --> 00:12:24,919 people in an economy. So then we start talking about 199 00:12:24,960 --> 00:12:28,279 the institutions. What kind of institutions do we need that 200 00:12:28,399 --> 00:12:32,440 allow us to cooperate share our human capital in a 201 00:12:32,480 --> 00:12:35,840 way that grows prosperity. Well, markets are a very powerful 202 00:12:35,840 --> 00:12:38,600 way to do that. And so I think we need 203 00:12:38,639 --> 00:12:41,480 to be very winsome in the way that we approach 204 00:12:41,600 --> 00:12:44,679 the topic with younger generations and the way we teach it. 205 00:12:45,080 --> 00:12:47,840 So rather than saying socialis is stupid, why don't you 206 00:12:47,919 --> 00:12:52,000 get that, we should say I too care about you know, 207 00:12:52,559 --> 00:12:54,279 a twenty two year old who just moved to the 208 00:12:54,279 --> 00:12:56,559 city and needs to pay their bills and wants to 209 00:12:56,559 --> 00:12:59,960 get a job, and let's figure out ways to actually 210 00:13:00,039 --> 00:13:03,559 make their dollar go farther, give them some income mobility 211 00:13:03,639 --> 00:13:05,919 so that they don't have these problems in the long run. 212 00:13:05,960 --> 00:13:08,080 I think that's the way to transition it so that 213 00:13:08,120 --> 00:13:11,519 we can open their minds to more market oriented approaches. 214 00:13:16,159 --> 00:13:19,960 Speaker 3: Talking heads are preaching that you're entitled to your social security, 215 00:13:20,080 --> 00:13:22,399 but are you The watch Dout on Wall Street podcast 216 00:13:22,399 --> 00:13:25,360 with Chris Markowski every day Chris helps unpack the connection 217 00:13:25,480 --> 00:13:28,240 between politics and the economy and how it affects your wallet. 218 00:13:28,399 --> 00:13:31,480 Two Supreme Court decisions have said connors can cancel social 219 00:13:31,519 --> 00:13:34,279 Security tomorrow and you can get nothing. You may want 220 00:13:34,279 --> 00:13:37,159 to believe the social security myth, but you're not entitled 221 00:13:37,200 --> 00:13:39,080 to it. Whether it's happening in DC or down on 222 00:13:39,120 --> 00:13:40,759 Wall Street, it's affecting you financially. 223 00:13:40,840 --> 00:13:41,360 Speaker 1: Be informed. 224 00:13:41,440 --> 00:13:43,279 Speaker 3: Check out the watch dot on Wall Street podcast with 225 00:13:43,399 --> 00:13:46,639 Chris Markowski on Apple, Spotify, or wherever you get your podcasts. 226 00:13:49,840 --> 00:13:53,919 Speaker 1: Well, Zron Mandani certainly comes across to me at least 227 00:13:54,000 --> 00:13:57,039 as the guy who steps into the big trouble in 228 00:13:57,159 --> 00:13:59,879 River City, the flimflamb man, you know, trying to sell 229 00:14:00,799 --> 00:14:05,440 something that's been tried and failed multiple times. And you 230 00:14:05,480 --> 00:14:08,039 know you don't have to You don't have to go 231 00:14:08,120 --> 00:14:10,840 to the Soviet Union in nineteen eighty nine or nineteen 232 00:14:10,960 --> 00:14:15,159 fifty six. You can go right here to the United 233 00:14:15,200 --> 00:14:19,600 States of America, where this experiment has been tried and failed. 234 00:14:20,240 --> 00:14:22,960 As you noted in your piece in the Washington Post, 235 00:14:23,120 --> 00:14:28,639 Kansas City's Sun Fresh government backed grocery store, which recently 236 00:14:28,759 --> 00:14:34,279 closed due to high crime and low prob profitability despite 237 00:14:34,279 --> 00:14:38,799 receiving significant public funding. That is an example here on 238 00:14:38,919 --> 00:14:43,200 the ground that we've seen in real time. And shouldn't 239 00:14:43,240 --> 00:14:46,679 that be an alarm for the folks in New York City. 240 00:14:47,320 --> 00:14:51,000 Speaker 2: I would think so, and it should be because I mean, 241 00:14:51,039 --> 00:14:53,480 and this is as you mentioned, this grocery store was 242 00:14:53,600 --> 00:14:58,320 heavily subsidized. It lost something like nine hundred thousand dollars 243 00:14:58,399 --> 00:15:02,559 last year before it closed. So this is again, all 244 00:15:02,600 --> 00:15:05,799 those resources have opportunity costs tied to them. So if 245 00:15:05,799 --> 00:15:08,679 we know that something is going to fail and we 246 00:15:08,759 --> 00:15:12,080 put money into it anyway, then we're basically saying that 247 00:15:12,159 --> 00:15:14,960 we don't want that money, right it's worth the loss, 248 00:15:14,960 --> 00:15:17,399 And of course that's not the case, and so I 249 00:15:17,399 --> 00:15:20,879 think we need to highlight these examples. As I mentioned earlier, 250 00:15:21,080 --> 00:15:23,840 I think part of the problem is if you haven't 251 00:15:23,879 --> 00:15:26,919 lived through it, maybe you know, maybe nobody's read about 252 00:15:26,960 --> 00:15:29,519 the Kansas City example. And I think it's getting more 253 00:15:29,519 --> 00:15:35,200 attention because Mom Donnie is proposing it in New York City, 254 00:15:35,240 --> 00:15:37,080 and of course a lot of people pay attention to 255 00:15:37,360 --> 00:15:39,240 pay attention to what's going on in New York City. 256 00:15:39,279 --> 00:15:42,399 So I just think this idea is generally getting more traction, 257 00:15:42,840 --> 00:15:44,720 and in a way, that's a good thing. This is 258 00:15:44,759 --> 00:15:48,320 an opportunity for us to say this will never work. 259 00:15:48,440 --> 00:15:52,639 It doesn't matter how charismatic the politician is. It doesn't 260 00:15:52,720 --> 00:15:56,960 matter how nice they seem, how well intentioned they seem. 261 00:15:57,440 --> 00:15:59,799 We have to do cost benefit analysis, and we have 262 00:15:59,879 --> 00:16:04,240 to know that without market prices and the profit and 263 00:16:04,320 --> 00:16:08,720 loss signals that only come about in a market economy, 264 00:16:09,600 --> 00:16:12,559 entrepreneurs do not know what to do right. And I 265 00:16:12,600 --> 00:16:14,720 think that that's a lesson that comes out of really 266 00:16:14,840 --> 00:16:17,360 understanding economics. And I think this is kind of what 267 00:16:17,480 --> 00:16:21,360 blew away the Soviet leaders because they were masters in 268 00:16:21,559 --> 00:16:25,080 planning everything. They thought everything could be centrally planned. They 269 00:16:25,399 --> 00:16:28,399 hired a lot of PhD economists. People don't always think 270 00:16:28,440 --> 00:16:31,320 about that, right. These are people who are well versed 271 00:16:31,320 --> 00:16:33,759 and educated in economics, but that doesn't mean that you're 272 00:16:33,840 --> 00:16:37,720 qualified to set the prices of tomatoes. Nobody knows what 273 00:16:37,759 --> 00:16:41,960 those should be because they can't be known prior to 274 00:16:42,000 --> 00:16:44,799 the act of engaging in exchange. And so there's some 275 00:16:44,919 --> 00:16:47,679 nuanced ideas in there. But I think it's possible for 276 00:16:47,799 --> 00:16:51,480 us to use this moment to be a teachable moment 277 00:16:51,559 --> 00:16:54,399 so that we don't keep trying this, because I think 278 00:16:54,559 --> 00:16:57,960 there's going to be more disappointment down the road, and 279 00:16:58,440 --> 00:17:01,399 attached to that disappointment is going to be, you know, 280 00:17:02,080 --> 00:17:05,119 at a cost, a fiscal cost that the city will 281 00:17:05,119 --> 00:17:08,200 have to bear. And so in eighteen months or two years, 282 00:17:08,240 --> 00:17:11,880 when this fails, then what And I think we need 283 00:17:11,920 --> 00:17:14,960 to ask those questions and point this out now so 284 00:17:15,000 --> 00:17:17,119 that hopefully we can avoid it. I know in Chicago 285 00:17:18,079 --> 00:17:20,000 the mayor was also tying with this, and then the 286 00:17:20,039 --> 00:17:22,119 idea was just kind of done away with. And that's 287 00:17:22,160 --> 00:17:25,119 the hope here. I think that's the best outcome we 288 00:17:25,119 --> 00:17:26,079 could get at the moment. 289 00:17:26,799 --> 00:17:29,519 Speaker 1: Yeah, because it certainly looks like mom Donnie is on 290 00:17:29,599 --> 00:17:33,519 his way to become the next mayor of New York. 291 00:17:33,880 --> 00:17:37,920 We talk about opportunity cost the real costs though to 292 00:17:38,119 --> 00:17:41,440 the private sector. You know, Mom Donnie says, and he 293 00:17:41,480 --> 00:17:43,640 has said over and over again, you know, we'll take 294 00:17:43,640 --> 00:17:47,960 out price gouging. This won't impact the mom and pop 295 00:17:48,000 --> 00:17:51,960 stores at all. You know, we won't dominate the market 296 00:17:52,000 --> 00:17:57,640 place and control all the prices. The other mom and 297 00:17:57,680 --> 00:18:00,559 pop stores, the other supermarkets in this they don't have 298 00:18:00,559 --> 00:18:04,599 to worry about this at all. Again, history tells us 299 00:18:04,599 --> 00:18:06,839 something different. What do you think will be the ultimate 300 00:18:06,880 --> 00:18:11,640 impact if you have this city run grocery store taking 301 00:18:11,680 --> 00:18:15,839 out you know, inherent competition, right. 302 00:18:16,079 --> 00:18:20,039 Speaker 2: I think that there's no way around that. I think 303 00:18:20,480 --> 00:18:25,200 if you look at the concerns voiced by Bodega owners originally, 304 00:18:26,279 --> 00:18:29,119 that were real concerns. Which is I mean, think about 305 00:18:29,440 --> 00:18:33,319 your typical small mom and pop type of market in 306 00:18:33,359 --> 00:18:36,759 New York City. It's run by a family, that family 307 00:18:36,839 --> 00:18:39,839 works all the time their kids, work in the storm, 308 00:18:39,839 --> 00:18:44,000 and just countless stories like this, right, So that's that's 309 00:18:44,039 --> 00:18:46,640 what you're going to put out of business. So I 310 00:18:46,640 --> 00:18:50,200 think you can't say I'm for you know, kind of 311 00:18:50,559 --> 00:18:53,920 I'm doing this for low income, middle class groups can't 312 00:18:53,920 --> 00:18:57,559 afford high grocery store when when the active of your 313 00:18:58,559 --> 00:19:01,640 policy proposals will actually put those very people out of business. 314 00:19:02,000 --> 00:19:04,200 And so that that's inevitable because one of two things 315 00:19:04,240 --> 00:19:08,440 will happen. Either these city run grocery stores will open 316 00:19:08,559 --> 00:19:11,720 and they will have kind of something like competitive market prices, 317 00:19:11,839 --> 00:19:14,160 meaning they'll just mimic the prices that we see in 318 00:19:14,200 --> 00:19:20,319 other grocery stores, or they will say, let's offer lower prices. So, 319 00:19:20,480 --> 00:19:22,160 you know, because that's the whole point, right, The whole 320 00:19:22,200 --> 00:19:23,960 point is, and I want to get to the price 321 00:19:24,000 --> 00:19:26,960 gouging comment in a moment, but his whole point, I 322 00:19:26,960 --> 00:19:30,640 think is people can't afford groceries. Grocery prices are out 323 00:19:30,640 --> 00:19:32,799 of control. The way to solve this is to have 324 00:19:32,839 --> 00:19:34,720 a city run grocery store where I'm going to put 325 00:19:34,720 --> 00:19:36,440 experts in charge of the prices and we're going to 326 00:19:36,480 --> 00:19:38,200 give people deals. And the way we're going to do 327 00:19:38,240 --> 00:19:39,960 this is because we own the land, and we're going 328 00:19:40,039 --> 00:19:42,759 to subsidize all this stuff. So he makes it sound 329 00:19:43,000 --> 00:19:45,519 compelling like this seems like a good idea. But if 330 00:19:45,519 --> 00:19:48,799 you lower the prices, if they are not market prices, 331 00:19:48,839 --> 00:19:53,000 but they are undercutting retail prices, then all of the 332 00:19:53,039 --> 00:19:56,000 other people, especially the small mom and pops, they are 333 00:19:56,039 --> 00:19:59,279 not going to be able to withstand that competition. Moreover, 334 00:19:59,559 --> 00:20:02,200 grocery stores in general, and I'm talking about the massive 335 00:20:02,319 --> 00:20:05,480 chains like Stop and Shop which is in the Northeast, 336 00:20:05,599 --> 00:20:08,440 or you know Safe Way, Harris Teeter, all these types 337 00:20:08,440 --> 00:20:12,279 of Walmarts. Walmart is the world's largest grocer. They run 338 00:20:12,319 --> 00:20:15,400 on one to three percent margins. 339 00:20:15,039 --> 00:20:17,960 Speaker 1: Yes, very very thin margins. 340 00:20:17,519 --> 00:20:19,799 Speaker 2: Very thin, I mean. And the way I like to 341 00:20:19,839 --> 00:20:21,720 talk to my students about this is, think about when 342 00:20:21,759 --> 00:20:24,480 you walk into any grocery store, Safeway or something like this. 343 00:20:24,960 --> 00:20:28,319 There's all this prepared food, which is wonderful, it's very convenient, right, 344 00:20:28,319 --> 00:20:30,119 but there's also all this produce and stuff. So you 345 00:20:30,200 --> 00:20:33,039 can imagine the ice cream. If they don't sell all 346 00:20:33,079 --> 00:20:35,000 the ice cream tonight, it's no big deal. It can 347 00:20:35,039 --> 00:20:37,599 sit in the freezer for maybe weeks, I don't know. 348 00:20:38,160 --> 00:20:43,720 But the cupcakes, the sushi rolls, the fresh bagels and doughnuts, 349 00:20:44,200 --> 00:20:47,559 those have such a narrow time window on them that 350 00:20:47,640 --> 00:20:50,920 if you don't sell what you think you're going to sell, 351 00:20:51,440 --> 00:20:52,839 then at the end of the day you might have 352 00:20:52,880 --> 00:20:55,960 to throw it away. That's why the profit margins are very, 353 00:20:56,079 --> 00:20:59,960 very narrow, and it's very competitive. So it's just inconceivable 354 00:21:00,559 --> 00:21:03,720 that a state run grocery store, which means we're not 355 00:21:03,759 --> 00:21:07,200 going to govern what the grocery store does by market prices. 356 00:21:07,359 --> 00:21:10,319 We're going to govern it, govern it by bureaucratic decree. 357 00:21:11,039 --> 00:21:14,119 How will they know, How will they know how to 358 00:21:14,160 --> 00:21:16,680 price them? How will they know how to manage inventories? 359 00:21:16,960 --> 00:21:19,839 They don't have profit and loss systems because we've taken 360 00:21:19,920 --> 00:21:22,240 that out. They won't know, is the answer. And so 361 00:21:22,279 --> 00:21:24,680 I think this will have a ripple effect in terms 362 00:21:24,680 --> 00:21:30,119 of other types of investments by small businesses, destroying small businesses, 363 00:21:30,160 --> 00:21:33,559 which is something that I would think Mom Donnie does 364 00:21:33,599 --> 00:21:35,720 not want to do, and that's going to be a 365 00:21:35,799 --> 00:21:37,759 natural consequence. And if I may, I want to talk 366 00:21:37,759 --> 00:21:41,839 about this price scouching idea because I think, again, this 367 00:21:41,880 --> 00:21:47,640 is very appealing to people. It's it's kind of a belief, 368 00:21:47,799 --> 00:21:52,119 a common belief. Maybe that's a company like Walmart, which 369 00:21:52,319 --> 00:21:55,680 has you know, kind of mask it a huge operation, 370 00:21:56,160 --> 00:21:58,359 over one hundred thousand stores, I believe. I think they 371 00:21:58,400 --> 00:22:02,039 operate in over twenty for countries something like this. It's 372 00:22:02,079 --> 00:22:05,400 a massive operation. You know, they just have all this 373 00:22:05,480 --> 00:22:09,640 extra profit lying around, and so what they do is, 374 00:22:09,799 --> 00:22:11,680 you know that they can just afford to kind of 375 00:22:11,720 --> 00:22:14,480 price gouge. And I think people use the term in 376 00:22:14,559 --> 00:22:17,839 their mind price gouging happens whenever a price goes up. 377 00:22:18,519 --> 00:22:21,160 But this is not what economics would tell us. Just 378 00:22:21,200 --> 00:22:25,160 because a price goes up doesn't mean that the entrepreneur 379 00:22:25,440 --> 00:22:30,240 or the firm is gouging someone. Prices are a reflection of scarcity. 380 00:22:30,359 --> 00:22:33,640 So you might remember, you know, we were talking a 381 00:22:33,640 --> 00:22:36,079 lot about egg prices over the last year, and the 382 00:22:36,119 --> 00:22:38,759 reason that egg prices went up is because we had 383 00:22:38,799 --> 00:22:42,160 a supply shock due to avian flu. So when all 384 00:22:42,200 --> 00:22:46,400 of the chickens die, you're going to have a problem 385 00:22:46,480 --> 00:22:49,640 producing eggs. And the only way to reconcile that in 386 00:22:49,680 --> 00:22:52,599 the market is for the price to go up because 387 00:22:52,640 --> 00:22:56,039 it has to meet demand and we have to slow consumption. 388 00:22:56,119 --> 00:22:58,839 And that's again a very organic process. Nobody was in 389 00:22:58,960 --> 00:23:01,319 charge saying Okay, the price needs to go from this 390 00:23:01,400 --> 00:23:03,759 to this. So I think that will ultimately be the problem. 391 00:23:03,799 --> 00:23:08,240 But again, I think this taps into an emotional sentiment 392 00:23:08,279 --> 00:23:11,559 that people have, which is that big firms always have 393 00:23:11,680 --> 00:23:16,200 monopoly power. Therefore they run around engaging and price gouging 394 00:23:16,240 --> 00:23:18,720 all the time, and we need to stop them. And 395 00:23:18,839 --> 00:23:21,400 one way to selp them perhaps is to have a 396 00:23:21,440 --> 00:23:23,880 city run grocery store. But again, Walmart runs on a 397 00:23:23,920 --> 00:23:26,519 one to three percent profit margin as well, so there's 398 00:23:26,680 --> 00:23:30,440 very little room for error in fact, in the market. 399 00:23:30,880 --> 00:23:33,880 Speaker 1: When all the chickens die. It sounds like an Academy 400 00:23:33,880 --> 00:23:35,160 Award winning movie. 401 00:23:35,480 --> 00:23:36,240 Speaker 2: Yes it does. 402 00:23:36,839 --> 00:23:39,559 Speaker 1: I'll watch for it this holiday season. Our guest today 403 00:23:39,680 --> 00:23:44,119 is Anne Rathbone, Bradley George and Sally Mayer, Fellow for 404 00:23:44,319 --> 00:23:48,599 Economic Education and Vice president of Academic Affairs at the 405 00:23:48,640 --> 00:23:52,759 Fund for American Studies and economic professor at the Institute 406 00:23:52,799 --> 00:23:57,599 for World Politics. We talked today about Zoran Mamdani, the 407 00:23:57,720 --> 00:24:01,880 leading candidate for New York City mayor. He also happens 408 00:24:01,880 --> 00:24:05,480 to be a socialist and avowed one, and he has 409 00:24:05,559 --> 00:24:10,519 made no secret of his socialism plans for New York City. 410 00:24:10,839 --> 00:24:15,039 You know, The bottom line here to me and is 411 00:24:15,079 --> 00:24:19,640 that it's the same over and over again with the socialist, 412 00:24:19,720 --> 00:24:24,880 the communist, the Marxist movement, and the idea is trust us, 413 00:24:25,640 --> 00:24:28,920 Trust us, we know what we're doing. We'll go up 414 00:24:28,920 --> 00:24:34,359 against big capital and will win. Trust us. That's Isn't 415 00:24:34,359 --> 00:24:38,480 that the campaign that you're hearing from? Zorn Mundani? 416 00:24:39,640 --> 00:24:42,000 Speaker 2: I think that's absolutely the campaign, and I don't think 417 00:24:42,039 --> 00:24:45,359 it's new to him. I think that most people American 418 00:24:45,400 --> 00:24:50,079 politicians today who would claim the democratic socialist label, I 419 00:24:50,119 --> 00:24:55,759 think they speak two ordinary people. They address their concerns 420 00:24:55,799 --> 00:24:58,200 in a real way, I think again, as I've said before, 421 00:24:58,240 --> 00:25:01,640 they're often very charismatic in doing so, and they focus 422 00:25:01,720 --> 00:25:05,039 on the trust issue. Don't worry about the math, don't 423 00:25:05,079 --> 00:25:09,039 worry about the logistics, don't worry about the budget. Just 424 00:25:09,119 --> 00:25:13,079 trust me, because I care about you, and voters want 425 00:25:13,119 --> 00:25:15,759 to feel cared about so I kind of, you know, 426 00:25:16,000 --> 00:25:21,279 am sympathetic to how appealing this sounds. But again, that's 427 00:25:21,319 --> 00:25:24,039 why we have to understand history, and we have to 428 00:25:24,119 --> 00:25:28,319 understand economics, and we have to know that every time 429 00:25:28,480 --> 00:25:32,799 socialism is tried, it will fail, and the reason it 430 00:25:32,839 --> 00:25:35,680 will fail is because nobody we can trust them all 431 00:25:35,759 --> 00:25:38,119 day long, but they don't know what to do. They 432 00:25:38,240 --> 00:25:42,599 do not know how to plan an economy and let alone, 433 00:25:42,640 --> 00:25:46,240 you know, not even a grocery store. And that's why 434 00:25:46,319 --> 00:25:50,559 these city owned grocery stores continue to close and to 435 00:25:50,599 --> 00:25:54,119 have all sorts of other problems. Empty shelves, right, they 436 00:25:54,119 --> 00:25:59,359 can't restock in time. I think a way to show 437 00:25:59,640 --> 00:26:02,759 the busness of markets is to ask people to think 438 00:26:02,799 --> 00:26:06,599 about what happened in your grocery stores during COVID. COVID 439 00:26:06,799 --> 00:26:11,759 was a global event, right, it affected everyone. At the 440 00:26:11,799 --> 00:26:12,839 beginning of COVID. 441 00:26:13,799 --> 00:26:16,680 Speaker 4: Everybody remembers this, right, it was you know, the toilet paper, 442 00:26:17,440 --> 00:26:20,440 the toilet paper, but also we thought it was which 443 00:26:20,480 --> 00:26:24,039 is still weird to me, but that's okay, Right, it was, 444 00:26:24,200 --> 00:26:27,279 you know, two weeks to slow the spread, and we 445 00:26:27,359 --> 00:26:29,400 just didn't We didn't know how long. 446 00:26:29,279 --> 00:26:31,359 Speaker 2: We were going to be inside. We didn't know how 447 00:26:31,400 --> 00:26:32,720 long we weren't going to be able to school all 448 00:26:32,759 --> 00:26:35,680 the things. There's just so much that was just unknown 449 00:26:35,720 --> 00:26:38,039 to most people. And I think we learned a lot 450 00:26:38,039 --> 00:26:40,680 over the course of that. But I remember in the 451 00:26:40,759 --> 00:26:44,680 early days, they suggested that one person in your household 452 00:26:44,680 --> 00:26:46,480 should go to the grocery store, right, because I think 453 00:26:46,519 --> 00:26:49,480 the idea was, we don't want people going outside and 454 00:26:50,759 --> 00:26:53,680 mingling with other people. So in our household, my husband 455 00:26:53,720 --> 00:26:56,640 did the grocery shopping, and he kind of became an 456 00:26:56,680 --> 00:27:01,000 expert in grocery shopping because he realized that, well, Wegman's, 457 00:27:01,000 --> 00:27:03,839 which is one grocery store in Nears, get their deliveries 458 00:27:03,839 --> 00:27:07,000 on Tuesday or whatever, and this grocery store has this 459 00:27:07,079 --> 00:27:09,960 policy about toilet paper, and so he would hop around 460 00:27:10,039 --> 00:27:13,440 to grocery stores. And what was interesting is that I 461 00:27:13,559 --> 00:27:16,640 remember one of my neighbors sending me a text message 462 00:27:16,640 --> 00:27:19,720 at eleven PM and she said, I'm at the grocery 463 00:27:19,720 --> 00:27:23,200 store and there's almost nothing in here. That is astounding 464 00:27:23,279 --> 00:27:25,160 in the United States, right, JNS. 465 00:27:25,920 --> 00:27:28,279 Speaker 1: That is the Soviet that is the Soviet Union. That's 466 00:27:28,319 --> 00:27:31,000 what That's what Yeltson found, That's what Krushchev found. 467 00:27:31,359 --> 00:27:35,880 Speaker 2: Yes, every day it was empty, so for it to 468 00:27:35,920 --> 00:27:39,440 be full for them was remarkable. For us, it's the opposite. 469 00:27:39,480 --> 00:27:42,960 Every day it's full, and we see that as unremarkable, 470 00:27:43,000 --> 00:27:45,359 which we shouldn't. And then my neighbor is saying, oh 471 00:27:45,359 --> 00:27:47,720 my gosh, there's nothing here. This is crazy, and it 472 00:27:47,799 --> 00:27:50,960 was crazy, But you know what they did. They found 473 00:27:50,960 --> 00:27:54,559 a way to restock it pretty quickly. Why what is 474 00:27:54,599 --> 00:27:58,839 the difference. The difference is that grocery stores operate on 475 00:27:59,000 --> 00:28:01,960 profit and loss, and they had to find a way 476 00:28:02,279 --> 00:28:05,160 to get as much to fill those grocery stores during 477 00:28:05,160 --> 00:28:09,039 COVID as they could. And without the capitalist system, the 478 00:28:09,119 --> 00:28:11,279 market economy in the United States, we wouldn't have been 479 00:28:11,319 --> 00:28:14,440 able to fill those grocery stores during a pandemic when 480 00:28:14,440 --> 00:28:17,160 everybody was kind of panicking. We didn't know how long 481 00:28:17,200 --> 00:28:20,440 we'd be inside. I remember people were stockpiling dry goods 482 00:28:20,440 --> 00:28:22,319 at the beginning. I mean, we didn't need to do that, 483 00:28:22,359 --> 00:28:25,440 but we didn't know. And so the grocery store was there, 484 00:28:25,519 --> 00:28:27,640 and they found a way to get it restocked every day. 485 00:28:27,799 --> 00:28:30,720 That doesn't happen in Cuba today. That does not happen 486 00:28:30,799 --> 00:28:33,119 in Venezuela's day, and it did not happen during the 487 00:28:33,759 --> 00:28:36,599 eighty years of central planning of the Soviet Union, you know, 488 00:28:36,680 --> 00:28:39,799 and the trust us thing, that was the trope of 489 00:28:39,880 --> 00:28:42,920 the Soviets as well. Just trust us, here's another five 490 00:28:43,000 --> 00:28:46,680 year plan. We'll get it right this time. But you 491 00:28:46,720 --> 00:28:51,200 can't trust something that is impossible that's the lesson here. 492 00:28:52,079 --> 00:28:56,200 Speaker 1: Five year plans and new deals wrapped in golden chains, 493 00:28:56,960 --> 00:28:59,880 the great stages of our time, greeden s, clearwater revival. 494 00:29:01,359 --> 00:29:03,799 It is absolutely true, and we've seen it over and 495 00:29:03,799 --> 00:29:06,440 over again. You mentioned covid You know, that's not too 496 00:29:06,519 --> 00:29:09,680 long ago. People should have a fair understanding of that, 497 00:29:09,720 --> 00:29:12,839 But they forget too soon. I think back in the 498 00:29:12,920 --> 00:29:15,440 nineteen seventies when I was a kid, and the gas 499 00:29:15,519 --> 00:29:17,759 lines that we saw in the United States because we 500 00:29:17,799 --> 00:29:21,599 were dependent on other market forces. We are seeing the 501 00:29:21,640 --> 00:29:25,119 same thing now in this battle in the shutdown. You 502 00:29:25,200 --> 00:29:30,680 have Democrats who are dying on the hill of this 503 00:29:30,920 --> 00:29:37,839 government shutdown, fighting for the expansion of COVID era benefits 504 00:29:38,559 --> 00:29:42,880 that we simply as a debt ridden country, can't pay for. 505 00:29:43,400 --> 00:29:47,000 And this should have been gone a while back. But 506 00:29:47,359 --> 00:29:49,359 you know, that's the thing. We see this in all 507 00:29:49,480 --> 00:29:53,400 kinds of different systems, and over and over again we 508 00:29:53,519 --> 00:29:56,720 see the failure. The issue that I think I'm seeing 509 00:29:56,759 --> 00:30:00,640 more and more. You know, The correlating line here is 510 00:30:00,640 --> 00:30:03,599 that in New York, you know, people get, as you said, 511 00:30:03,759 --> 00:30:07,039 tired of the high prices, whether it be grocery stores 512 00:30:07,119 --> 00:30:12,839 or rent or whatever, and more and more. You have 513 00:30:12,960 --> 00:30:20,119 Americans dependent on the dependency of the central planning of government. 514 00:30:20,359 --> 00:30:25,400 That is something that has really become an issue with 515 00:30:25,640 --> 00:30:29,160 the you know, the social safety Net, which was you know, 516 00:30:29,279 --> 00:30:33,039 is designed to help people back up, not to keep 517 00:30:33,240 --> 00:30:38,880 staying down. But that's what cynical politicians have done over 518 00:30:38,960 --> 00:30:43,599 the last fifty plus years in this country. How how 519 00:30:43,640 --> 00:30:47,799 do we get the message of the importance of everything 520 00:30:47,839 --> 00:30:52,160 you just talked about, the marketplace, supply demand, capitalism at 521 00:30:52,200 --> 00:30:56,440 its core to people who are so dependent on the government. 522 00:30:58,799 --> 00:31:01,640 Speaker 2: I think this is the question, Frankly, and I think 523 00:31:01,680 --> 00:31:03,720 it's an important question for people on the right and 524 00:31:03,799 --> 00:31:06,200 people on the left, because what we've seen is just 525 00:31:06,319 --> 00:31:08,599 exactly what you're talking about. I mean, one of your 526 00:31:08,640 --> 00:31:12,559 examples was the how much the social Safety Net has grown, 527 00:31:14,000 --> 00:31:18,359 and how that's you know, fiscally irresponsible because we can't 528 00:31:18,400 --> 00:31:20,440 pay for it. But I think on the right and 529 00:31:20,480 --> 00:31:23,599 the left, what we've seen, especially over the past you know, 530 00:31:23,799 --> 00:31:28,240 seventy eighty years, is just a desire for big government. 531 00:31:29,000 --> 00:31:32,839 We like to spend on different things, but this is untenable. 532 00:31:33,440 --> 00:31:39,440 I think we're I think we are absolutely imposing debt 533 00:31:40,160 --> 00:31:43,119 on future generations who have not are yet to be born. 534 00:31:43,680 --> 00:31:48,000 So that I think there's a moral crisis that underpins 535 00:31:48,039 --> 00:31:51,279 our spending crisis. And so your question is the question 536 00:31:51,359 --> 00:31:54,920 how do we stop the dependency? The grocery store is 537 00:31:55,000 --> 00:31:57,519 just one example of that. But you know, to your point, 538 00:31:57,559 --> 00:32:02,880 the social safety net is supposed to be theoretically temporary, right, 539 00:32:03,000 --> 00:32:06,119 if you are able bodied and you can work, then 540 00:32:06,160 --> 00:32:10,240 the idea here is that you don't. It's temporary, You 541 00:32:10,279 --> 00:32:12,319 don't stand it forever. How do we find a way 542 00:32:12,359 --> 00:32:15,160 to help you through whatever it is you are dealing with? 543 00:32:15,680 --> 00:32:18,720 Is it divorce, is it homelessness? Is it addiction? Is 544 00:32:18,759 --> 00:32:21,559 it you've lost a job and you can't whatever it is? Right? 545 00:32:23,279 --> 00:32:27,000 And we haven't done that. And I think that there's 546 00:32:27,119 --> 00:32:31,599 really strong political incentives in terms of the social safety 547 00:32:31,640 --> 00:32:35,119 net to not reform it, because, as you mentioned, that's 548 00:32:35,119 --> 00:32:38,599 how you continue to get votes. So if you create 549 00:32:39,799 --> 00:32:43,359 a category of people of voters who are dependent on you, 550 00:32:43,960 --> 00:32:46,720 then the only way to sustain that is to keep 551 00:32:46,759 --> 00:32:50,279 them dependent on you. And so it's a weird, very 552 00:32:50,480 --> 00:32:54,839 perverse incentive, which is maybe the political goal is actually 553 00:32:54,960 --> 00:33:00,119 for people not to be relieved of welfare assistance, but 554 00:33:00,160 --> 00:33:02,000 to stay on it forever, because that's kind of a 555 00:33:02,039 --> 00:33:05,720 guaranteed voting block. That's pretty pernicious, and I think it's 556 00:33:05,759 --> 00:33:09,359 antithetical to a prosperous economy. It's also antithetical to the 557 00:33:09,640 --> 00:33:13,839 human dignity and the human spirit. You know, people don't 558 00:33:13,880 --> 00:33:18,480 want to depend on someone else for their entire lives. 559 00:33:18,920 --> 00:33:22,519 I think it's dehumanizing. And so the problem with all 560 00:33:22,559 --> 00:33:26,759 of this is that our assistance is generic by definition. Right, 561 00:33:27,160 --> 00:33:31,279 The bureaucrats have to decide generic rules for a generic person, 562 00:33:31,680 --> 00:33:34,440 and then they write checks, or they give food stamps 563 00:33:34,559 --> 00:33:38,400 or a variety of things. But people aren't generic. And 564 00:33:38,920 --> 00:33:40,920 I think if you look at the founding of our country, 565 00:33:41,319 --> 00:33:45,759 the social safety net was administered by nonprofit organizations, by churches. 566 00:33:46,079 --> 00:33:50,680 There was such a robust civil society in which the 567 00:33:50,720 --> 00:33:55,920 social safety net was carried out very successfully. The question 568 00:33:56,000 --> 00:33:58,400 is how you know? Kind of invoking Tokville here, right, 569 00:33:58,400 --> 00:34:01,279 this is what he found, in some ways very remarkable 570 00:34:01,279 --> 00:34:04,480 about the United States. And a robust civil society means 571 00:34:04,480 --> 00:34:06,799 we don't go to the government first to solve our problems. 572 00:34:06,880 --> 00:34:09,960 We go to each other. I think we need to 573 00:34:09,960 --> 00:34:13,400 get that back. Unfortunately, I think this is a battle 574 00:34:13,440 --> 00:34:16,679 of ideas before it's a battle of policy. I think 575 00:34:16,800 --> 00:34:19,760 the ideas we have about who we are, what we 576 00:34:19,800 --> 00:34:21,880 should do, and what our government should do for us 577 00:34:22,199 --> 00:34:25,920 come before who we vote for in the voting booth, 578 00:34:26,400 --> 00:34:28,679 and so I think we need to really have a 579 00:34:28,760 --> 00:34:31,880 revolution of ideas that and then I think we can 580 00:34:31,960 --> 00:34:34,480 change our policy. But you know, the big questions are, 581 00:34:34,519 --> 00:34:36,039 how do we get there. I think we can get 582 00:34:36,039 --> 00:34:38,199 there in the classroom. I think we can get there 583 00:34:38,199 --> 00:34:40,480 by doing what we're doing right now, which is having 584 00:34:40,960 --> 00:34:44,960 a genuine conversation about this is a tough problem and 585 00:34:45,000 --> 00:34:46,599 what are ways that we can try to fix it, 586 00:34:46,679 --> 00:34:49,519 and opening that conversation to as many people on the 587 00:34:49,599 --> 00:34:50,840 right and left as possible. 588 00:34:51,639 --> 00:34:55,679 Speaker 1: Well, the states have long been the laboratories of democracy, 589 00:34:56,079 --> 00:35:00,880 and I think what Americans have seen from certain states 590 00:35:01,360 --> 00:35:06,119 over the last couple of decades, in particular, I think 591 00:35:06,119 --> 00:35:12,679 it's been eye opening and it's I think awakened Americans 592 00:35:12,840 --> 00:35:17,239 to the perils of some of these experiments going on 593 00:35:17,760 --> 00:35:22,639 in these labs. California comes to mind. We had a 594 00:35:22,679 --> 00:35:27,079 stand in presidential candidate for the Democrat Party who came 595 00:35:27,239 --> 00:35:31,719 smack dab out of the California idea and ideal, and 596 00:35:31,800 --> 00:35:39,000 Americans rejected that wholesale. So I'm curious if my mom, 597 00:35:39,079 --> 00:35:41,679 Donnie goes on to win and it looks like he's 598 00:35:41,719 --> 00:35:44,960 on the path to do that, and he implements this 599 00:35:45,239 --> 00:35:49,719 grocery store idea, you know, publicly owned, city owned grocery store, 600 00:35:49,800 --> 00:35:52,519 and he you know, and it's not only that he's 601 00:35:52,559 --> 00:35:57,519 looking at, you know, rent controls and trying to you know, 602 00:35:57,599 --> 00:36:00,960 get control over that marketplace in New York and all 603 00:36:01,000 --> 00:36:04,519 of these other things. But if he does what history 604 00:36:07,039 --> 00:36:13,320 portends he will do, that is to fail remarkably, will 605 00:36:13,400 --> 00:36:18,920 that turn the Americans who got all excited about the 606 00:36:18,960 --> 00:36:22,639 new socialism? You think that we'll turn some minds. 607 00:36:23,760 --> 00:36:26,679 Speaker 2: Unfortunately, I don't want New York City to experience that. 608 00:36:26,920 --> 00:36:29,880 But I think, yes, I mean I think sometimes, you know, 609 00:36:29,960 --> 00:36:32,679 I have two kids, so sometimes they have to touch 610 00:36:32,719 --> 00:36:35,159 the hot stove to learn not to do it. Yeah, 611 00:36:36,000 --> 00:36:38,079 And I think that that's what's going on here. I 612 00:36:38,159 --> 00:36:44,719 think the intoxicating lore of free things wins in many 613 00:36:44,800 --> 00:36:48,639 cases at the ballot box. Right free. He's talking about 614 00:36:48,679 --> 00:36:52,000 free buses, free daycare, free groceries, all this type of 615 00:36:52,039 --> 00:36:55,000 free stuff, but somebody always has to pay for it. 616 00:36:55,920 --> 00:36:58,039 You don't have to have a PhD in economics or 617 00:36:58,079 --> 00:37:00,559 finance either to know that. Right somebody to pay if 618 00:37:00,559 --> 00:37:02,679 you want a doctor to be in the hospital to 619 00:37:02,679 --> 00:37:04,159 take care of you, if somebody needs to pay a 620 00:37:04,199 --> 00:37:06,519 salary or her salary, that's just the way it goes. 621 00:37:06,920 --> 00:37:10,400 So the hope is that if this happens to New 622 00:37:10,480 --> 00:37:14,400 York City that they will learn very quickly that this 623 00:37:14,559 --> 00:37:17,679 is not good for the city. It's not good for crime, 624 00:37:17,920 --> 00:37:21,199 it's not good for income mobility, it's not good for 625 00:37:21,320 --> 00:37:25,320 job creation. Moreover, if taxes are raised, I think people 626 00:37:25,360 --> 00:37:27,719 will leave New York City, and that is going to 627 00:37:27,760 --> 00:37:30,880 hurt the city more because they won't have a tax 628 00:37:30,960 --> 00:37:33,639 base to fund these programs into the future. So it's 629 00:37:33,719 --> 00:37:37,039 kind of could turn into be a big short term problem. 630 00:37:37,360 --> 00:37:40,559 And so the hope is that the lesson has learned quickly, 631 00:37:42,760 --> 00:37:45,719 you know. Unfortunately, I think it remains to be seen 632 00:37:45,840 --> 00:37:46,480 what happens. 633 00:37:47,000 --> 00:37:51,800 Speaker 1: Yes, yes it does, and will much will teach us 634 00:37:51,840 --> 00:37:54,760 coming up in the next couple of years. We always 635 00:37:54,760 --> 00:37:57,840 talk about these are crucial times or critical times. This 636 00:37:57,880 --> 00:38:00,840 is a critical election in all of those sorts of things. 637 00:38:00,920 --> 00:38:02,920 And you know, the more you say it, the more. 638 00:38:03,119 --> 00:38:07,599 It sounds wrote and hyperbolic, but these are critical times 639 00:38:07,639 --> 00:38:10,480 at the polls. New Yorkers are experiencing that now and 640 00:38:10,679 --> 00:38:18,039 what they do ultimately today to decide their future. I 641 00:38:18,039 --> 00:38:20,719 think we'll say a lot about not only New York, 642 00:38:21,079 --> 00:38:26,000 but the rest of the country. So with all of 643 00:38:26,039 --> 00:38:30,280 that said, final question for you, where do we go 644 00:38:30,519 --> 00:38:34,480 from here? Knowing that it's not only New York. You know, 645 00:38:34,519 --> 00:38:40,519 we have candidates in Minneapolis that are pushing socialism, we 646 00:38:40,559 --> 00:38:46,400 have candidates in New Jersey pushing socialism. So the obviously 647 00:38:46,440 --> 00:38:49,719 the trend line is here. They're catering to that poll 648 00:38:49,840 --> 00:38:53,840 that we talked about of young people in particular looking 649 00:38:53,920 --> 00:38:57,440 for this so called new direction. It's not new at all. 650 00:38:57,559 --> 00:39:00,559 It's been tried and it's failed. But you know, we 651 00:39:00,639 --> 00:39:04,840 fail to remember where does all of this, mom Donnie 652 00:39:04,840 --> 00:39:07,119 in particular, suggest we are going as a country. 653 00:39:07,760 --> 00:39:10,599 Speaker 2: Well, this is a good question. I think that there 654 00:39:10,840 --> 00:39:15,280 is you know, if it happens and it's even temporarily 655 00:39:15,360 --> 00:39:20,880 successful or doesn't kind of collapse immediately, I think that 656 00:39:21,400 --> 00:39:24,079 there could be more that could be fanning the flames 657 00:39:24,119 --> 00:39:27,920 of this movement. But I think that it won't take long, 658 00:39:28,039 --> 00:39:31,760 and by long, I mean, you know, a couple of years, 659 00:39:32,000 --> 00:39:34,559 eighteen months, something like this to show that this will 660 00:39:34,559 --> 00:39:39,360 have devastating impacts. And I think that will be a 661 00:39:39,519 --> 00:39:43,119 very important wake up call. I think the other thing 662 00:39:43,199 --> 00:39:47,239 is it's fine to love socialism. Maybe when you're young, 663 00:39:47,239 --> 00:39:49,639 maybe it's not fine, but I can understand it, right. 664 00:39:49,679 --> 00:39:52,480 But once you start making a lot of money and 665 00:39:52,519 --> 00:39:57,239 paying taxes, Americans really dislike taxes. And so I think, 666 00:39:57,480 --> 00:39:59,760 you know, kind of the ABC's of this come together 667 00:40:00,119 --> 00:40:02,000 pretty quickly, which is that if I want all this 668 00:40:02,119 --> 00:40:05,840 government stuff, I'm going to have to have a very 669 00:40:05,920 --> 00:40:09,199 high tax burden. And the more successful I am, the 670 00:40:09,280 --> 00:40:12,119 higher that tax burden is going to become. And that 671 00:40:12,960 --> 00:40:15,239 really causes people to kind of put the brakes on 672 00:40:15,360 --> 00:40:17,639 and say, this is not really a great idea. So 673 00:40:18,000 --> 00:40:20,559 I think that there's going to you know, it's the 674 00:40:20,760 --> 00:40:24,760 long run will reveal the truth about socialism, as it 675 00:40:24,800 --> 00:40:27,199 always does. I think in the short run, this is 676 00:40:27,239 --> 00:40:30,559 a time for us to talk about ideas. I think 677 00:40:30,599 --> 00:40:35,199 we need to speak winsomely and generously and graciously to 678 00:40:36,280 --> 00:40:39,440 people who advocate for socialism. And I think it's easy 679 00:40:39,480 --> 00:40:41,480 online and all this type of stuff to kind of 680 00:40:41,519 --> 00:40:47,639 just really be vicious to one another. And I prefer, 681 00:40:48,079 --> 00:40:50,599 you know, let's treat each other as human beings and 682 00:40:51,519 --> 00:40:55,199 assume the best of intentions and then go from there 683 00:40:55,320 --> 00:40:58,280 and figure out, Okay, how can we help low income people, 684 00:40:58,320 --> 00:41:00,800 How can we help people who can't afford college, How 685 00:41:00,800 --> 00:41:03,039 can we help people who can't afford groceries in their 686 00:41:03,079 --> 00:41:05,800 cities and rent? As you said, And then I think 687 00:41:05,840 --> 00:41:08,400 we need a campaign for economic freedom. I think we 688 00:41:08,480 --> 00:41:11,880 need to be unabashed and unashamed that economic freedom is 689 00:41:11,920 --> 00:41:16,440 the way, it's what has always made America great. It 690 00:41:16,480 --> 00:41:19,079 is what is the only hope to continue to make 691 00:41:19,119 --> 00:41:21,719 America great. And I think we need to call out 692 00:41:21,760 --> 00:41:27,519 both sides when they advocate for policies that aren't inherently 693 00:41:27,760 --> 00:41:30,440 antithetical to that economic freedom. And I think when we 694 00:41:30,519 --> 00:41:34,559 do that, we earn a lot of trust to people 695 00:41:34,599 --> 00:41:36,159 who have these real questions. 696 00:41:36,800 --> 00:41:40,119 Speaker 1: I think you said it best at the Fund for 697 00:41:40,199 --> 00:41:44,400 American Studies when you said the battle of ideas is 698 00:41:44,440 --> 00:41:47,840 not over. It is being waged heavily in the United States, 699 00:41:47,840 --> 00:41:51,599 Western Europe, all over the world. Economic freedom is on 700 00:41:51,679 --> 00:41:55,440 the rise globally, but it is in decline in the 701 00:41:55,559 --> 00:41:59,960 United States. That's very concerning, and it's going to record 702 00:42:00,039 --> 00:42:07,880 fire a different mindset than we've had challenging these threats 703 00:42:07,960 --> 00:42:12,960 to this republic, representative democracy, and the systems that we 704 00:42:13,039 --> 00:42:17,639 have cherished and have been so successful for two hundred 705 00:42:17,880 --> 00:42:23,320 fifty years. Thanks to my guest today, Anne Rathbone, Bradley George, 706 00:42:23,320 --> 00:42:27,280 and Sally Mayer, Fellow for Economic Education, Vice president of 707 00:42:27,320 --> 00:42:30,840 Academic Affairs at the Fund for American Studies, you've been 708 00:42:30,880 --> 00:42:33,480 listening to another edition of The Federalist Radio Hour. I'm 709 00:42:33,480 --> 00:42:37,199 Matt Kittle, Senior Elections correspondent at the Federalist. We'll be 710 00:42:37,280 --> 00:42:40,719 back soon with more. Until then, stay lovers of freedom 711 00:42:41,199 --> 00:42:56,519 and anxious for the Fray