Page. It is great to be here with you all to celebrate and discuss an excellent new book by one of our countrys most original and insightful economic thinkers. Amity shlaes. Over the course of her distinguished career she has brought her wideranging intelligence and feel for storytelling to some of her countrys leading intellectual and cultural institutions. She has served as a member of the wall street journal editorial board, columnist for Financial Times and bloomberg news, she has taught economic history at the stern school of business. Now in addition to her prolific book writing, amity serves as a president ial scholar for kings college, chairs the board of the Calvin Coolidge president ial foundation, and in a big coup for us at michigan chairs the whole Selection Committee for the Manhattan Institute high outcries. An award she herself has won. Few decades have imprinted on the popular imagination quite as much as the 1960s and so many of us remember that decade for its most dramatic and turbulent moments. The assassinations of the kennedys and Martin Luther king jr. The march on washington and antiwar protests. Neil armstrong on the moon and fighting in vietnam. Amitys focus is not the job that played across the screens on the country abindeed a generation of politicians came to realize that the centralized hierarchical and highly regulated model of political economy that dominated postwar america had stopped working. Yet more than just the technical failures, amity captures the stifling feeling of a country run from the top down. America put up with the machinery and culture of mobilization during the two world wars and in the early years of a Nuclear Cold War but at some point that old american yearning swashbuckling, independentminded, mistrustful of authority was bound to reemerge. This is a vitally important story for our time and we can all be grateful amity has told it with such insight and verb. Im happy to report that books will be sold in the back of the room, ladies and gentlemen, amity shlaes. [applause] thank you. If you cannot hear me, please let me know. Thank you, a book about the Great Society deserves great thanks. My thanks to the Manhattan Institute president. Its former president , who is also here, larry moen. Vice president Vanessa Mendoza and abfor planning this event. I would like to thank my family, my husband and my daughter flora are both here tonight. The first sentence of the book is a question, why not socialism. This is a question we ask ourselves last night we watch the president ial debate. How do we answer it . Its a question all centrist, all commonsense people, all markets people want to be able to deliver in answer to. We all really feel an obligation to undertake those a longterm investment in projects that would open american minds that american minds see the challenge in the tragedy of socialism. We want to share the record of the past or the record of venezuela so that when they come to vote or leave businesses and families younger americans recognize what is not useful policy. But where are we . Its november and 2019. Educating is a longterm investment. Some of us dont have the heart for the long haul. We feel frustrated at the prospect of slow outcomes and perhaps outright failure in our intellectual entrepreneurship politics are much more fun and instant gratification. All of us have some vanity. People remember politicians they do not always remember educators. We tend, we journalist, business people, philanthropists, scholars, we want to be remembered and sometimes we pick shortterm projects for that reason. Tonight i like to tell you a story of really longterm project. A crazy project. This is a story which starts in the 1950s, features a company, a man, and the american public. Those are the three characters. It is indeed a story of a failing longterm project of humiliation of business, shame, and intellectual failure nowhere around it. But the story, which ends in the 1980s, also reveals an unexpected payback as some of you may know the characters but might appreciate hearing about them one more time. The name of the company was General Electric. In the 1950s, General Electric road hyatts factories in new york, massachusetts, and connecticut employed many thousands come of the Industrial Center in some ways. Every year americans bought more tvs, more radios, or more freezers. Ge was not just a company, it was an icon. It served the Space Program and the Tennessee Valley authority. Americans trusted General Electric just like it was as a trusted the game of baseball. A good company that follows rules the essence as you know the soviets in 1959 invited the u. S. To create a display about progress at moscow. The colicky park. America sent several modern kitchens and the lemon yellow one was General Electric. Most ge executives at the time, we are talking about the late 50s, like execs at most companies at that time had a set view of how capitalism works. The private sector was invincible. It was like a workhorse or moo cow. What it was supposed to do was to serve as that milk cow for the public sector. The government herded the private sector like a domestic animal. John mader and keynes noted this at one point to ge or most of ge, that sounded just fine. The milk cow was content with the government. The Tennessee Valley authority the big client was the essence of government project and ge executives at the top like to very much. And ge found that tva was one of its biggest customers. They didnt mind serving the Space Program. Unions existed by virtue of very strong union law and they demanded big pay packages. Social experiments by the federal government. American business could pay that. Maybe expansion of healthcare, the u. S. Could pay that or perhaps a longer leave for young parents. Thats just a joke. Something like a longer leave for young parents in the early 60s we could pay that too. Heavy unions we could pay any load. Stalin was said to have joked that the only country rich enough to afford communism was the United States. [laughter] why should it not be true . Why should it not be true . In the 1960s just some benchmarks for you, the Dow Jones Industrial average was approaching a record level of 1000. It seemed only a matter of months before the dow would pass up landmark. There was one aging underappreciated executive at ge who saw things differently. He was an older guy. He was a Vice PresidentLabor Relations and the name of this man was lemuel ricketts boulware. Boulware believed it did it come with the board pay taxes to the federal government or when it met all together and wrote out big plans. He believed growth took place when a lonely scientist in a dumpy lab had an idea and flaunted the world. Ideas like the light bulb. I ge idea. The high wages and prices would have ge were competitive nobody could quite imagine japan at this point that was the scope of the imagination of a Pristine Company like General Electric to return to the old capitalism the quote is the rapid train trend are to be changed with everything that we cherish the younger executive at General Electric found it ludicrous the superlative irritated them and in the public many agreed with the evaluation to describe this Vice President the folksiness kentucky with the fervor of a washing machine salesman. [laughter] they did not worry they were the future but he was approaching retirement and then in his recliner from delray beach. With ge and america he spent millions of ge money pamphlets explaining the value of markets where ge operated the midwest or the east and all the extra social benefits in massachusetts and warned people grass would grow to the importance of competitive prices and wages and cost. In that case it would be creating a tv show called ge theater to showcase traditional American Values including that aging actor to be the ge spokesman that was a union man a democrat who fired Franklin Roosevelt and the new deal so i wont say his name yet. [laughter] but he had potential. [laughter] with a special ge house with all modern appliances like the ge kitchen and those who was Ronald Reagan and von hayek and those have little essays added. That gave out like the Manhattan Institute this actor, Ronald Reagan wasnt popular across ge either talking about western propaganda they complained about him but they could not stop bowl would send him all over around with the mimeographed pages with the future of industry and it might move west and so on and then they talk about the dangers of socialism and socialism the medicine is a bad idea maybe hydropower wasnt the only kind of power of the future of the United States and soon enough reagan the actor began to take the arguments seriously he even bought some ge stock so year in 1960 was a dark cloud over ge with the propaganda mill. The Justice Department was investigating the communist and the new attorney general Robert Kennedy pulled together a strong case ge was colluding like westinghouse to fix high prices the Justice Department went to court and the judge said the ge executive to jail so here was the Propaganda Department mouthing off about the free markets even as they cheated the american taxpayer. A terrible blow the Company Looks like the worst hypocrite in the world of people felt betrayed like the black sox scandal of 1919 a National Betrayal the stock went in the toilet the actor was fired ge theater was canceled and the exact got pneumonia and retired to delray beach this only deepened a sense of failure ge itself increased cooperation with the federal government American Voters didnt turn away from socialism or just government expansion sounded nice they voted in Lyndon Johnson and a socializing program the Great Society johnson promised to cure property to make america an even better place with an Even Stronger economy and the beginnings of the National Healthcare system of medicare this year they did strengthen unions and johnson was only the beginning one of the revisions of the Great Society in this book is a revision of Richard Nixon i discovered actually expanded government as johnson had before him even more rapidly to imagine a great process of program upon program of Charles Murray from the Manhattan Institute so than to lay out a few more here is the scope of what the Great Society yielded by 1980 health and medical cost were six times the 1950 cost in dollars by 1980 public assistance was 13 times the 1950 cost social insurance was 27 times the 1950 level and housing cost were 129 times the 1950 cost last night one of the candidate suggested we need to spend more on housing . What happened . The Great Society failed government expansion did not eradicate poverty in fact the reduction of the poverty rate was already coming down and had flattened out we ended up with 10 percent then stayed there it shackled americans into dependence there was a parable on the morning after effect the economy began to flail as never before and went from 10 percent in the Interest Rate was at 15 percent the high cost of labor with policies backed by the government drove American Companies to leave towns just as predicted the great Thriving Center of detroit i do ride a lot about that in Great Society the Dow Jones Industrial average went below 1000 for a generation. Americans believe the ever rising stock market is their birthright so to contemplate that from the mid sixties through the eighties even with grade inflation we never passed 1000 you can imagine if we had to wait until 2035 to get to the next barrier. In my book i learned you dont have to be socialist all the way to do damage even a little socialism does incredible damage this isnt a paradox but you do eventually get there and sooner than you think. The whole while you can imagine boulware was beating himself up but as you know one actor did care and that was reagan he decided to try politics and in 1964 he took the standard speech out of the can america has to choose socialism or not its called the time for choosing speech and then the aftermath for the governor of california challenging the Great Society numerous times including the Legal Department and put the policies of ge into practice saving money fighting expansion of welfare personal dignity and respect for markets and when he did run for president it was 1980 and was no longer the morning after effect of the Great Society it could be morning in america. The entire Council Revolution came out of those pamphlets that were so lovingly prepared that nobody remembered to pay off in the magnitude unimaginable. Markets thrived in the era of which we did have a Thriving Market one of 12 chapters of the book first of all the over arching lesson is that government is rotten at planning to get the perverse outcome that then to start looking like a complete goo for failure may not turn out to be a complete failure in the end sometimes it is good and that factor those tens of thousands between reagan and ge do have the effect that there was another way for the American Worker with the famous bluecollar vote the other more famous with the Great Society offers lesson in trusting your own judgment. If you think it isnt good it probably isnt if you suspect it might be good invest in it. Think of the institutions that inspired you as a child much of the work that i do in the Patent Institute does tries to plant the seeds theoretical seeds could be the most fruitful the third and final point individuals matter with an old broken windows policy. Now to raise theoretical glass of wine im standing right here three decades after the death of that of scare executive and raising a mental glass but also most of all raising a glass. Thank you very much. [applause] we can now take a few questions. When i think of the Great Society two things come to mind when i think of the Great Society two things come to mind lbj and the riots in the street. And what i remember about the Great Society is at lbj was abandoned opposed to the vietnam war was the naacp. So what about the civil rights revolution . How could that not be in your book how do we great the great explain the Great Society. It is in my book and very extensively. This is just one chapter. Looking at civil rights law the act which came before the Voting Rights act and revolutionary. Following the Howard University speech that is positive and i argue theres plenty of evidence that those benefits didnt help people they kept them poor for example we talk about hillbilly appellation and what can we do with the struggling group in addition to poverty . In the 19 sixties we have appellation law it just made life harder to getting benefits. So that johnsons Howard University speech i think johnson got ahead of. And along treatment of the delegation that was not seated and then to turn away with the mississippi party. Im very excited to read your book there are two schools of thought about the Great Society to be bad and counterproductive in the second the basically it does enough for about enough to include transfers and tan on tax credits that a lot of these programs help to reduce poverty and to do so many more transfers with the scandinavian european type system salon that centrist point of view that basically there is enough transfers now. Thank you thats a very important question count poverty with or without benefits. When you go without there is a lot of poor people. They are becoming so accustomed that they can work even if it keeps people quiet. But the money that flowed from the office of Economic Opportunity it didnt work and that you can see we are angry about genuine problems. You cannot buy out that you could be string stronger to give you an opportunity. I am part way through your book which i am enjoying. Can you talk about the relevance of your book about redistribution which is really kind of knew right now. And just to make it more complicated what is the role of the cold war and how communism and the threat to the american way of life. Can answer the second and first . So younger people today they have not served in the military by a large so they love the idea. And my book has a statement through the 19 forties. They were less naive because the world was closer and communism was closer and the brother was in the korean conflict. So the progressives can call for socialism then he can talk about socialism this doesnt have to do with moscow there is a number of progressives the very few were actual traders the problem is that they were wrong about their ideas. So we can talk about socialism and the soviet union and so on. In the book i tried to capture the romance of socialism so they go to the latin American Country or they follow scandinavia or their outrage a character that goes on the trip thats called looking for socialism and the character is tom hayden. Peter collier died and he gave me a picture that tom hayden gave me of the fuselage from an american jet it was a knickknack of pride that hundreds of american planes downed somebody gave someone that calm to tom hayden who gave it to peter collier. Toms trip is very romantic. He meets a girl and intellectually lazy and crazy and doesnt see the reality in had no way at all. Wondering if johnson called a halt because he didnt want to be blamed for bombing tom hayden but thats the story of romance of socialism as a present today and he ended the chapter he decides that socialism is wonderful because if its not on not finished nobody ebay long can criticize it. Whether there is a society the model that we might follow . I dont want to Say Something bad has to happen that usually the pattern usually get knocked and then they reboot. I do believe americans love business more we can expose to traditional common sense ideas or reading books they dont get to read and highschooler Calvin Coolidge so to respond with great excitement so to put my foundation we have a scholarship for academic or Academic Merit at the Coolidge Foundation is kind of like the Rhodes Scholarship about Academic Merit and we only have four scholarships per year because they are very expensive as a full ride to college we already have 15000 kids who have registered to apply. What do they want . They want the money. But a lot of them also like the idea of doing things on your own. I think its important to send signals you will be rewarded for enterprise and trying and doing things on your own and going your own way and currently our system doesnt particularly do that its about how you can figure out what you can get from the point of a 17 yearold so we need to change the political culture between 15 and 20 yearold to show them whats in it for them and the natural wisdom which they have and you might not be wrong. [applause] i encourage all of you to buy a book. Your friends and enemy. Thank you for this wonderful book. [applause]