Transcripts For CSPAN2 In Depth With Steve Forbes 20160605

If you lead with an issue, lead like you have conviction, you can get peoples attention. Its amazing. Thats why sometimes i shouldnt say this on the air i fantasize that maybe joe shoot all the Political Consultants because they dont understand how you get a message across in a way that the American People can grasp and say, yes, this is the way we should go. Host you have been talking about the flat tax for a long time. Your second book what flat texas resolution. Your moe recent book is reviving america. What is a flat tax. Guest it takes the current code, get rid of it. A couple years ago the taxwriting committee in congress, tried to rationalize the current code. The bill came in at 997 pages, which tells you all you need to know. So bury the tax code but the epa may not allow it, its so tox. But throw away the code, put in a sinkle rate. We friend the book 17 . General his exemptions for adults and children, nobody gets a tax increase in this thing. For example, a family of four, your first 52,800 of salary is free from federal income tax. No tax on your savings. No death taxes. Always believe you should be allowed to leave the world unmolestedly the irs. On the corporate side, knock the rate down to 17 . Immediate expensing of Capital Expenditures and above 52,000, pay 17 cents on the dollar and could literally do your tax return on a single sheet of paper or a few key strokes on a computer. By the way, 40 countries and jurisdictions have variations of the flat tax. This is not a laboratory theory. This works in the real world. Host how had is worked for the other countries. Guest very well. Almost all of them have kept the thing. It creates more growth because you can spend your time working on the thing, doing real things instead of coping with the tax code. And much easier to administer and collect. So the tax evasion is that much more difficult. Host one of the complaints that we currently have about our system is that not everybody pays taxes. You believe that everybody should pay taxes. Guest well, i take a little different everyone who works pays taxes. You pay taxes on Social Security forestial security and medicare, the fica taxes. The government pretends thats not a tax but a contribution for your future retirement, for pensions and healthcare but in the real world its a tax from your first dollar of income. So you take a typical american if theyre working, yes, theyre paying income taxes to the feds one way or the other, and on state level, most states have state income tax with a low level of threshold so they pay that as well. So no one is getting away with not paying taxes unless your not part of the economy. Host are you a one percenter . Guest im a one percenter. But what the amazing thing is, in terms this is one of the things we get to in the book, we can discuss later, on the subject of money, when you have an unStable Currency you get more sharper social divisions because of the economic stagnation. The one percent versus the 99, young versus old, Public Sector versus private sector, 47 versus the other 53 . People dont know why the economy is not moving. But in america, at least until recently, before we had this stagnation, it was remarkable how fluid our situations were in economic life. 400 richest list, an one. Off the next. My father would say you think youve arrived and nothing stays the same. Host the sub title is how repealing the obama cars, replacing the tax code you write the Healthcare System is like a patient who has been miss diagnosis expect treat emtime and again with the wrong medicine. Just keeps getting sicker. Decades of growing government involvement that grossly distorted the health care system. Guest it has indeed. Nobody designed the system we have today. And i dont care what political persuasion you are, no one is happy with the system we have today. Already now medical costs are starting to go up again. When you go to a hospital, most people bad enough to go to the hospital but the experience leaves them really shaken. You wonder, do the specialists talk to each other . Do in the hospitallists talk to each other . You say aunt tilly cant have a certain medication and yet she is administered the medication. Its an unnerving experience. So, the system grew out of world war ii, they had wage and price controls with millions of people gone in the armed services. You had labor shortages at home. Werent allowed to people pay cash so people paid in kind, benefits. Healthcare benefits from the government. Then after the war, the irs ruled that this could be legitimately Tax Deduction for businesses and not count as income to employees. So nobody designed the system. It grew higglypiggly. This gets to the core of the problem. The problem with health care is the lack of real free market. The Real Customers halve Insurance Companies, government, and employers. Its not the patient. And hospitals know, for example, they get their revenue by how well they negotiate with Insurance Companies and with the government, not how they satisfy patients. When we cite in the book sounds frivolous but very telling, where the patient really lies in the food chain, is that the crumbiest, motel in the world wouldnt dare put you in a room with another guest with a curtain in between, a sick guest no one does that, yet its routine in hospitals. The crumby motel wouldnt give you a robe that looked like it came out of the Salvation Army dumpster. So the patients are not in control and the reforms we propose is to start to get where the patient is really in control and turn what looks like a hopeless liability in terms of financial liability costs keep going up and up interest the most Dynamic Growth industry ever. Host does the Forbes Company offer Health Insurance to its employees. Guest absolutely. And host is that good system where the employer is offering the Health Insurance. Guest no. But it grew, as i say. Nobody designed this thing. One of the things we have pioneered on long before government sanctioned it was the equivalent of Health Savings accounts. We give our people, forbes media, 2,500 cash during the course of the year. You are in charge of it. If you dont if youre blessed with good health and choose not to spend the money you keep it. Youve find a jenny, drug better than prescription, the savings is yours, not mine, not the insurance company, not the government. So we try to get people to become conscious of cost because its in their best interests to do so. So our costs over time when you compare apples to apples, oranges and oranges, age groups and that sort of thing, we havent had quite the problems on the company side but were a small outfit compared to the rest of the economy. Thats the thing you need where patients are in control of resources. So if you move to another company, that policy should go with you. What they call portability so youre not chained to could i issue want to leave but i cant because ill lose my benefits. We want to have liberation, again, patient control. Free markets. When allowed to work, always turn scarcity into abundance and will do so in health care and get more safety nets than the crazy system we have today. We do it in food. Government doesnt run agriculture. If it did would have no more obesity because we would all be starving. Child in russia and china and didnt work. So agriculture grow the food, social markets, Grocery Stores, when you have problems, you have the food banks to food stamps to deal with it. Why cant we do the same thing in health care. Real free enterprise, real productivity, real patient control and more effective safety nets, whether its the high risk pools or you will be covered if a catastrophe hits you. Host steve forbes, back to reviving america and taxes. The last thing we need is another halfbaked bandaid solution. Not enough to simply cut tax rates and reduce the number of tax brackets. Think of what happened in 1986. After the code was somewhat simply identified. Numerous tax shelters were eliminated and the number of brackets reduced to two. 28 and 15 . But no sooner was the ink dry on that legislation than washington politicians picked up their old habit there had been more than 15,000 changes to the code as congress, at the behest of a swarm of locustlike lobbyists, snuck in clauses and amendments to favor picker individuals, companies, industries, nonprofits. Guest yes. And that gets to why hopefully next year well get some serious tax reform. But thats why you have to have a single rate. In 86 we had two rates. Putting two tax rates together is like putting two rabbits together. They breed. They multiply. When you have a single rate, you want to change it, everyone sees and it knows theyll be affected, so its a real insurance against what happens 30 years ago when we last tried to simply identify the code. By the way, this also shows dealing with the code today impossible. That 86 act, simplification, came to 8600 pages. So throw the thing out. Start over. And those who worry ill lose my Charity Deduction and mortgage and all that sort of thing, do a variation of what hong kong does, give people a choice. Go with the new system or if you lack selfesteem and want to punish yourself and stay with the old go ahead. But this way you lower the temperature. You say to people, dont trust me. See for yourself which one is better. I think 99 . By the way, when we talk about taxes, we get all hung up on gdp and revenues and crossing lines and all that sort of thing. Think of it as an opportunity. Go back 20 years. The irs estimatees spend 6 billion hours a year fill ought tax forms, experts estimate we spend 200 billion complying with this monstrosity. Think over 20 years. Tens of billions of hours, trims trillions of dollar, immense brain power, imagine if all those resources had again to new products, now services, new medical devices, new cures for diseases, how much better off we would be. What economists call the opportunity costs. That is the real immoral travesty of the current code. What it is taking away from us, not just in the imbecility of it, the corruption of it, but what we have lost because we spent our resources on something that is totally unnecessary. Host my guess is your taxes are more complicate than most people. Have you ever figured out how much time, money, has been spent doing your taxes. Guest its horrific. 40 years ago, i could actually do my return. Back in the 1970s. I had accountants look over it but helped me understand the thing. Soon became impossible. The equation, the things you have to do, one insure eighth of this and a third of that and then substreak line 57a and then go to 8c, and by the way, i have Good Software to help me do it. Well, we point out that depending on your circumstances, Different Software packages will give you different estimates of what your Tax Liability is. Even they, the gods we worship, arent getting it right. Nobody can. Host in 1999 in now first book a any birth of freedom the dirty little secret in washington. What the politicians fear from tax relief and simplification is not a loss of revenue. What they really fear is a loss of power. Guest complexity is power. And, for example, here in washington, where we are today, if youre a member of the house ways and means committee, the Tax Writing Committee in congress, youre stuck for political life. You say i think ill have a reception tonight. Every lobbyist comes along with a check. Yes, need access, i will contribute to your campaign or pac or whatever you want, and this way they have power. You have to go to them. Either to protect yourself or try to shaft an opponent or something with the coat is being changed that is hurting your industry or business, so you always have to come to them. Which means checks. Be blunt about it. Host from reviving america our nation seems mired in a malaise that evokes comparisons with the 1970s. Is this uncertain polarized and economically stagnant america the new normal . Guest no. Some people take larry summers, former secretary of the treasury, talks about this new era as if its aliens from space, and something new forces of history. Thats absolute nonsense. What were going through today is a result of policy errors. The nice thing about errors is they can be corrected. Thats why we did the book. Obviously bat lot of things have to be done but we focused on big three reforms. Get those right and by golly this economy will come roaring back. We have been through these periods before. A terrible decade in 30s. After the war we nut reforms and came roaring back. Same thing in the 70s. The malaise decade, came roaring back in the 80s and 90s and we can do it again. Host the third part of your subtitle is rereforming the fed. You friend ron paul you write we may be in awe of the feds high priests but they can no more guess the need for money than the central planners can run an economy in the days of the soviet union. Guest absolutely. This idea that a handful of people at the fed can determine what Interest Rates are, how banks should be run, what the money supply should be, is preposterous. The soviet union fell and we point out in the book what the fed has done weakening the dooring, which start under a republican administration. This is bipartisan nonsense here in the early part of the least decade, started weakening the dollar. Thats why housing prices went up, and led to the disaster of 2008. Since 2008, the fed has still misbehaved. Take for example the whole thing on zero Interest Rates, should hey raise Interest Rates . Controlling Interest Rates is like price control. Theyre deforming the market. The feds should be out of it. They can set the rate theyll lend money to banks at. Thats legitimate. But in terms of trying to set the price of borrowing and lending for the rest of the economy, like the soviet union, it has distorted the market. For example, bonds. They i dont know whether they know they did this. They created a credit market today where the favoritism goes to bonds. Corporate bonds, government bonds. Who can issue bonds . Usually Big Companies, obviously government. What has happened if you look where credit has gone since 2008, since the fed started this nonsense, the Small Businesses, new businesses, households, timing. Killing the creation of new businesses. Killing the expansion of Small Businesses. Which is a key reason why in addition to overregulation, why for the first time in memory our Small Businesses arent being created in the number wes have traditionally had. Since 2009, the number of creation of Small Businesses is a fraction of what they were after previous recessions. We know, Small Businesses, new businesses, where the innovation comes from, and where job creation comes from. Not from the biggies but from the new ones. Hopefully tomorrows biggies. Its not happening. You have periods where businesses are Going Companies are going out of business at a faster rate than new companies are being created. That is brand new. So one of the great strengths of the countries, the able to always come up with new and greater companies. Back in the 7 ohs, whoever heard of microsoft, fedex, apple, and other companies, they all started as little companies in the 70s, became the biggizeies of the 90s and today. Were not getting that creation and thats the slow rot that people sense but cant put their fingers on. Host arent low Interest Rates politically popular . Guest well, we love the Old Soviet Union where they said the health care is free but you cant get any. The low rates today favor that but how much real homebuilding has been done . They say better in 2009. I hope so. But in terms of the needs of this economy, still not where it should be. You try to one reason you dont hey mobility. You want to move from here to texas or oregon or wherever. Can i get a mortgage there . Can the person who wants to buy my house here get a mortgage . Very, very uncertain. So the rates are low, but theyve deformed the market. Its like having a rent controlled apartment. If you dont mind the lack of upkeep because the landlord wont give you much upkeep, but in terms of creating new apartments, new housing, new businesses, doesnt work. So the feds have deformed the market. One statistic i hate to do this because it drives people away in the last five years, credit to government has grown 37 . Credit to corporations, 32 . Credit to Small Businesses and households, only six percent. Devastating figures, especially compared to the past. One reason why our labor market is so bad. Even putting aside how many people dropped out. People are not getting the jobs they should. Parttime jobs. People dont want them. Saw a lousy jobs report last month which was bad enough from what they call the Establishment Survey where they go to existing companies, called theb Central Planning does not work in the soviet union. The chinese are still grappling with trying to be with the old and with the new. Get their economy modernized. And yet the fed thinks it can guide the economy that by manipulating Interest Rate s. One thing, janet yellen who heads the fed today, says so do her colleagues we need two percent inflation. Thats a way of saying prices should fall two percent a year. A family making 50,000, the median income, translates to a thousand dollars a year. How in the world is raising the cost of living for family, a thousand dollars a year, stimulate the economy . I havent figured it out. I dont think they have. Manifestly they havent. Or else we would have a more vibrant Economy Today. Host was is some of our Monetary Policy today a result of the high inflation of the 70s . Were fearful of that. Guest what the 70s should have taught us is when you dont have a sound currency, when you dont have a currency that is a stable value, youre going to be its like a watch that cant tell time. Whether the dollar is weak or strong, its like a watch that is too slow or too fast. Neither one helps very much. So what we should have learned is stability is better than instability. A watch that can tell time is better than one that cant. But that lesson is lost on these people. Host are you a deficit hawk . Guest you have to be careful of that. Some who say we dont like deficits. They love spending. Which means they want to raise taxes. So, Milton Freedman years ago, famously said, he would rather have a government that shows shows out of date rather have a government with a budget of one trillion that was in serious deficit than a government that spent two trillion but the budget balanced. Whether you borrow the money or whether you tax the money, whether you try to print the money, one way or the other youre taking raleigh sources. This is a myth that government somehow creates resources. It doesnt. One point we make is that money is not wealth. Its a claim. You go to a restaurant, you check your coat, you get a piece of plastic or paper. Worthless but its a claim on the coat. Money is a claim on products and services. Has no intrinsic value. Based on trust. And so when you start mucking around with the ability, what that piece of paper can buy again, take our clock. Imagine the fed changed the clock, we know live would be chaotic, right . Lets say youre barracking a cake. Says bake the batter 30 minutes. Is that nominal minutes . Inflation adjust edmundss . A washington minute . A mexican minute a new york minute . Be chaotic. Thats what they dodoor do with the money. Money is a claim. So when you start to muck around with it you have problems. Host to the Gold Standard. Guest theres so many myths we deal with them in the book resee ifing america, about the Gold Standard. The Gold Standard is not using gold coins that would be highly inefficient to buy a pair of socks at walmart, 1,200 gold coin. Think of gold as a ruler. Gold keeps its value better than anything else. When you see the price fluctuate . That the value of the dollar fluctuating. Peoples perception now and the future. Sold e gold for 4,000 years for a variety of ropes keeps entrain sis value. Not perfectly but better than anything else. We had a Gold Standard for 180 years in the country, until 1970. We went through a depression, civil war two world wars, countless crises in between, and yet we achieved the highest Economic Growth rates in the history of the world. If we had maintained the same growth rates that we did for that 180 years, in the last 40 yours, our Economy Today would be 8 trillion bigger because the with a you get an economy, a higher standard o living, is by investing, doing new things, expanding businesses, starting new businesses, new products, new services. That takes investment. Thats risky enough. Most investments dont work out. But if you dont know whether youre going to get back 100cent dollar, an 80cent dollar, tencent dollar, you get less investment. So no surprise when we started to muck around 80s and and 90s, a c on Monetary Policy after the disaster of the 70s and went back to mucking around again. And look at this as investment. Stagnant. When anyone asks me, should i buy invest in gold, ill know we have problem. Buying metal, buying an object, great piece of art, thats not an investment. Then i know we have problem. The investing in the things that are unseen. New businesses. New factories. Bigger inventory. When you do things like already exist, it means people are realizing and protecting what they have, and also you go to commodities. Oil. Oil is one of the oldest mountains around, 150 years. And in the 7s so, when we devalued the dollar, went from three to 40 a barrel. People thought we must be are you out of this stuff. We cob at thed the inflation of the 80s and went down to ten dollars a barrel, crashed, terribleeesed at 20 to 25, then went back at it, suddenly went up to 100. We must be running out of the stuff. Alternative we went back on it. And so when things that are already around, like gold, like copper, like land, unless its in a hot area those things go up, housing prices go up, roughly, house that was worth 100,000 yesterday is worth 120,000 tomorrow, same house, no improvements, you got a problem. Host drew believe were living in a bifur indicated economy we have the haves and the havenotes and the middle class is shrinking. Guest we have a stagnant economy. Tens of millions of people, over half the population, their real incomes have not gone up. Thats not historical in america. Thats the new abnormal. When those things happen, people cant grasp why is it that prices seem to go up a prices go up, health care goes up, college goes up, and my income is not really going up. I just cant seem to get out of this thing like those nightmares where youre in quagmire and cant get out of the thing. You get real dissatisfaction. You dont just see it in this country. You see its around the world. People dont understand why are we in this rut . Why arent things belt center whoa the people in authority cant create an environment where we can get this train back on the track again. Host from your book, how capitalism will save us, this is warren buffet. If you are in the luckiest one percent of humanity, you owe it to the rest of humanity to become about the other 99 . Guest thats a tradition the country. We tend to think that america is the most philanthropic nation in the world, and people wonder why are we the most commercial nation and the most philanthropy ic . Commerce is meaning you succeed in true free markets by meeting the needs and wants of other people. Even if you lust for money, you dont get it unless the government is behind you. Unless you provide something that somebody else wants. I think it was steve jobs, when asked if he does marketing survey. So i said no, because peep dont know what it want until i show them. Putting something out there, and so free markets will turn scarcity into abundance. Free markets do work. If you allow them. When you put in huge regulations, just one example. The federal criminal code. They cant count the number of crimes that are in that code now. Almost 5,000, put in the regulations, 300,000, a professor writes for us, famous defense attorney, wrote other a book calledly to felonies a day that any professional, without that person knowing it, commits several felonies day because they have no idea these complex, vaguely written rules and laws, that emanate from here and you see it on the state level as well. That is not right. Again, that contributes to the frustration. You have all these regs, and theres an estimate of several years ago, that company with 19 or fewer employees, regulations cost almost 11,000 per employee. Companies with 500, a little over 7,000. This is why the Big Companies are doing very nicely most of them, a mall and Medium Sized Companies are struggling. Killed by the tax code and by the regulation and the unstable dollar and these uncertain credit markets. Host from your book, freedom manifesto, for 20 years, microsoft paid no attention to washington. The result . A mammoth antitrust action that dragged on for years costing the company billions of dollars in fines and legal fees. Today the company has a major presence in washington, dc, a employs numeraire powerful lobbying firms and individual lobbyists to protect its interests. Facebook, which became a multibillion dollar giant was not about to make the same mistake in 2011. The company, concerned by potential government privacy restrictions, opened up a spanking now 8,000 Square Foot Office in washington with a staff that includes a former privacy expert from the aclu, google, another startup turned giant, is spending each year, many millions of dollars on lobbyists. Guest yes. This tells you something about the scope of government today. If you reach a certain size, you have to pay tribute to the powers that be or theyll come and get you. Then it turns from protection. Thats a protection racket. From protection to cronyism. One thing that people are really upset about today. A recent example of it. Agency, inside the federal reserve, came out with which is that agency is unconstitutional but i think eventually will be thrown out came out with a rule, over 1,000 page rule, going to put socalled payday lenders out of business. One of the advocacies of that was google which said it wasnt going to allow payday lenders to advertise. Guess who has an investment in the company thats going to move into that market . As these people are put out of business . Google. Cronyism. Does forbes have a loppiest near washington, dc . Guest no. We have members and work with Publishing Association and the like but since were now more internet online, rates dont have the same impact they did in days past. But again, when they talk about, how do we curb all this lobbying in washington, you can put all the restrictions you have to be out of congress for 500 years before you can join a lobbying firm, all these things they put in, you cant have lunches and things like that. If you have a problem with mosquitoes, you have to get the bad water. Got to drain the swamp. Got to reduce the scope of government. And otherwise guaranteed, one way or the other, people will find ways to petition the government, especially one that holds life and death decision over their own existence. Human nature. Host steve forbes, we have been talking about this for 250 years in this country. You have been talking about this for your entire career. Why hasnt it changed . Guest part of in the book we hit this was a until the great depression, as we do today, we had the largest economy in the world. The most sophisticated economy in the world. Most complex country in the world. And we had also the smallest Central Government in the world. State governments are three times the size of the federal government. Then came the great depression, and one of the things that came out of world war one when they temporarily nationalized industries, massive control, was, ahha, that worked during the war. Why cant we night peacetime . Bigger government presence, get rid of wasteful competition and let science reign and experts expiring the glory will be here. Clearly that has not worked out well. One thing in freedom manifesto its not enough to say free markets work, government in many areas does not work very well, Veterans Administration and the like, not enough to say that because government always says, well, we may mess up, may screw up, may hurt the people were supposed to help but our heart is in the right places. We have the high moral ground. Business is grubby. You cant trust them. The truth of the matter is, again, the morality of free markets is, true free market, not cronyism is meeting the needs and wants 0 other people, and helps people whether they know it. Trying to figure out how to make you happy. Buy what your offering. Reduces barriers between people, contrary to myth. May not love your neighbor but you want to sell to your neighbor. And so thats why we have this complex Global Supply chain. People all working, making products. You take a typical product today, involves thousands of people, parts and pieces all around the world, you take the iphone, the ipad, 10 of those parts are made here, the rest are from around the world. But it gives us so its not just they deliver the goods. Theres a moral basis. Meeting the needs and wants of other people. Allowing creativity. Look at these entrepreneurs who rise out from the most strangest backgrounds, and they learn in free markets. Take steve jobs. If you task that personality and presented it to a Human Resources person today, without the name on it. Theyd say thats not the person we want here. He was often in his younger days an aggrandizer, take ago peoples ideas, putting people down. Thats why he was fired from his own company before the age of 30. But the amazing story about him is he learned to become an effective leader, how to bring others together to get something done. It was painful. He had a lot of setbacks but learned in a free market. Many people are not born they learn from experience, and he is a prime example of it. So, thats what free markets are about. Always turning scarcity into abundance. That first cell phone we had, 30 years ago, the motorola, big as a shoe box, weighed like other brick. 40 minute battery life, 3,995. Today they give them away. You can gate good smartphone, without a plan, from verizon or anybody else, for 100 bucks, 50 bucks. Now become so spoiled i grew up with a thing called card catalogues, remember those in libraries. Now you have instantfully front of you. Were so spoiled now that if we place a call to a shepherd in Outer Mongolia and it takes longer than ten seconds we say this is a piece of crap. Why isnt it working faster . That what free market does, turns scarcity into abundance. Host are you a Technology User . Guest yes, and since im a closet technology thats what i loved about the ipad. You touch and it something happens. And so thats the thing. You dont have to be an engineer drive an automobile. You dont have to be a technologist to use the stuff. Often times, the people who do best are not the ones who invent it. Are the ones ones who learn howu use the invention. Take the mainframe computer, came out of world war ii, designed to make it easier to calculate where artillery shells would go, very complicated mathematics. Computers had many more applications than artillery shell directories but who made the most money . Ibms comecompetitors went by the way. Who made the most money . Sam walton. Small northwestern arkansas retailer. At the time kmart, 50 times the sites of walmart. Walton realized he could use these new machines, develop special software to manage his inventory better than anyone else and then supply chains better than anyone else. That was the secret sauce. He used an invention better than anyone else. Host i think its in reviving america that you and your coauthor, Elizabeth Ames, talk about how google buys smaller computers, millions of them, and if they to do what they do and then throw one away if it needs to be thrown away. Guest yes, like a pen. Dispourable. We think google is a big giant today but in the 90s it was nothing two young kids going against microsoft. Yahoo was a big deal at the time. How are you going against these giants and Search Engines in n these two guys recognized that Search Engines should be like the brain. One cell, not very impressive. Put them together, it is impressive. So they strapped these devices together. You say, one doesnt work . Dont bother to fix it. Just put another one in thats one thing they dont want you know, theyre mammoth users of electricity. They go where hydropower and other access to a lot of cheap electricity. Mammoth user of electricity but it works. They beat the big guys at their own game. Host good afternoon and welcome to booktv on cspan2. This is the policeman where we invite an author on to talk about his or her body of work. This month is author, publisher, president ial candidate, steve forbes. He is the author of several books. Beginning in 1999, his first book a new birth of freedom vision for america. Flat tax revolution, using a post card to abolish the irs came out in 2005. Power, ambition are glory, came out in 2009. Holiday how capitalism will save us. Why three e free people and free market are the best answer money couple out. Fry freedom manifesto why free markets are more and Big Government isnt. 2012. And in 2014, how the destruction of the dollar threatens the global economy. And this past year, reviving america how repealing obamacare, replacing the tax code and reforming the fed will restore hope and prosperity this is an Interactive Program and we want to hear from you, and there are several ways for you participate in our program and talk withmer forks, you can phone 2027488200 in the east and central time zone 748, 820 in the mountain and pacific time zone. You can also send an email. To booktv cspan2. Org. You can make twitter comment, book tv is our twitter handle, and make a comment on facebook, facebook. Com slash book tv. One other way for you to contact steve forbes and thats whiff a text message, here is the number, only for texts, not for phone calls. Youve want to send a text from your phone, 5103405559. One more time, the text message number is 5103405559. And well begin taking those calls and comments in just a few minutes here on booktv. Steve forbes, Elizabeth Ames is a coauthor on a lot of your books. Who is she. Guest a person involved in Public Relations and communications. She worked with us back in the 1990s, and went out on her own, started her own firm, and so we have done several books together. I also did one with john privies, the classsivist. You mentioned power ambition and glory. It can help when you get two people, if they dont kill each other by the end of the process, which i always a danger in terms of interacting and getting something more sharply honed than perhaps you do on your own. Host what is your process with an Elizabeth Ames to write . Do you come if with the idea, they approach you with the idea. Guest in power, ambition, glory, john approached me and the idea he got to know me and i got to know him. I did a review of a book he did on hannibal, and he had the idea, said, im doing a book on ancient leaders. Like alexander the great. Maybe you could work and bring in modern Business Leaders in the last 100 years, and their economy common leadership lessons, and one thing became apparent times and circumstances changed between the world we have today and the world of 2500, 2,000 years ago, human nature does not. The attributes of effective leadership dont change. Thats what is so fascinating. About people. The ancient world, the world we have today, how people respond, how people respond to crisis, opportunities, one of the things you learn is, effective leaders are always innovators and also learned youre never master of the universe. No matter how smart you are or how good you are, other forces come to play. Host well, who was hannibal, and in your book, power, ambition, glory, you compare hand ball to google. Guest because hand ball is an innovate hannibal is an innovate for. His company, carthage, had been beaten by the romans, and target cathage wanted revenge and real as evidence if the dont knock out rome, rom would knock out them. One of the other was going to dominate. And so the romans thought that if carthage was going to go against rome it would take a southern route, land in southern italy and work up to room, and hannibal came up with the idea of why not come from the north where they wore not expected go through spain, go through the ale alps, with elephant, like animal tanks and hit them where they least expect it. He was an innovate for not only in terms of that kind of strategy but in terms of battle strategy, and a traditional battle the romans could over in except at the very end do coo not beat hannibal. Why didnt he win . Because he didnt control his universe. Car carthage would not give him the necessary resources to in finish the job. His father and uncle had been killed fighting hannibal, and instead of just raging the said the best revenge is success. He studied hannibal, studied his tactics and strategy, got to know lab any ball better than hannibal knew himself and did a reverse hannibal. He had to fight tooth and nail to convince the romans but took an army and went and reversed what hannibal did. He went into spain, and went from spain into threatening north africa, where carthage was, and when the carthageans thought way would have to face me roman army, they sent word to hannibal, come home to defend us, he said, you can handle that. But if you call me back, ill never get back to italy again, weve lost the war. They still called him back. They lost the war. Host from pour. In the ranks of corporate leadership a crucial mistake is attributing the success of a company solely to the skills and charisma to one individual, hit heroic ceo. Guest yes. Theres thank flay whole body thankfully a whole body of new literature coming out that one person cant do everything. An effective leader recognizes that he or she can do best and is able to assemble a team, fill in where you cant do it. There may be particular jobs you could do better than the person who is doing it, but is that the best use of your time . One of the challenges of Donald Trumps campaign, hes running that almost by himself. He needs teams if hes going to be effective in this general election. Otherwise he theyll overwhelm him. But in terms of a company now theyre discovering more and mow, how do you become innovative when youre large . Small teams. Jeff bezos has an effective team. The two pizza rule. When he put a Team Together, eight, 10, 12 people, gets bigger than that. Says if it takes more than two pizzas when they work agent nile its not going to work. Work at night its not going to work. How do you get this done . One person, preposterous. Like trying to run a country, the central planners, not going to work. You have to tap into the brain power. How you do that, hierarchy may not be the west way to do it. How do you develop teams in we see it in sports. The military is very good. Platoon level, developing teams to get jobs done. So, an effective leader will recognize, maybe he or she wants to parade to the press and im the genius but in their heart of heart theyd have to know this is what steve jobs learned you have to have effective people who can execute, couple up with creative come up with creative ideas. Your task is to make judgments what works and doesnt work and on jobs, one thing that haunted him was what happened to sony. After world war ii, a new company, dominated the whole new electronic world, and then it faltered. Part of the reason it faltered was it became a series of feif comes, products and none talked to the other and he feared that. So when he designs the under boiling in california, coupler teen know, things like where the restrooms were he made sure they were located with people and different products and different teams would run into each other and when way do hires it wouldnt just bev the department where this person might work. You would have other various parts of the Company Become involved. So you want get this build in fife comes. Us versus them and the lack of cooperation. So making a Large Organization become are one western can do it but if youre large, you better have effective teams. If you think you can do it yourself. Steve forks, somebody whose name is well known and whose name is on the company. Is it tempting, taking, intoxicating to maybe take credit . Guest well, success is the ultimate credit, and one of the challenges this is true of anything, in business all the time is what happens when your world is changed . The rise of the west. Destroyed everything id learned in my family learned in all of our people had learned. The models going back to the 1830s. The rise of the steam press. Destroyed. In fact we had to start all over. Easy to say. Extremely hard to do, which is why often outsiders who make the big changes, not the incumbent, because theyre not plagued with legacy. One thing that executives have to remind themselves what peter drucker, the late, great management grew rue, said companies should always ask themselves what is your purpose . What is your mission . What is it you are trying to do . If you try to focus on what your ultimate purpose is you dont get quite as hung up with the means to achieve that purpose are fundamentally changed, and part of the live in an era where its aid you can eat well or sleep. We eat well i can do, but sleep well is another matter. Theres no playbook. Heres what you do when your model has been destroyed. Youre inventing it as you go along so you have to be prepared. You will make mistakes. You are in uncharted waters. So the consumer has great new things and new services. For those returning it, by golly, can have some very tense moments. Host how did you respond . Guest thankfully, we recognized, made good decision, back 20 years when the web first came along and publishers thought, well take the printed page, put it on a screen and were in electronic publishing, this is the equivalent when over 120 years ago when movies were invented, some people thought you just filmed a stage play. That would be a feature film. No. Two different mediums inch the mid90s we took our new web site, put it in a separate building. Separate staff. Separate support system. Why . Critical reason was if you put that in the same line of structure, authority, it will get crushed. It will be bent, not out of malice. To immediate the immediate needs of the print side wimp didnt want the baby to get crushed in the crib so we had a separate entity. Ten years later came time unite them and we had a horrific problem in uniting two different cultures. The journalists on the web site the journalists on the print side thought that the web writers were peasants, just turning out crash, trash, and the web people thought print journalist were lazy snobs who didnt do very much. Turned out an article every two weeks and thought they were doing something. So, trying to mesh those together, very difficult. Many people couldnt make the transition. Today, its common knowledge, you master both. It was hard to do. Content creation. Turn out 12, 1300 printed articles a year, on the web now we do over 120,000 submissions. We have over 1,800 contracted contributors. Very different model. But again, serving the needs, but very different. Now were facing the challenge i think were doing it better than most, our people im not thankfully we have people with white house know what theyre doing facing the challenge of hand held mobile devices. Its constant. My father said, be shown the door. Nothing stays the same. Host what is forbes media today . Guest forbes media goes back in terms of getting the direction and purpose is our profound belief in entrepreneurial capitalism. Hi grandfather came to this country dc forbes. Guest dc forbes, very little money, came from scotland. He said the purpose of business is to produce happiness, not to pile up money. And so that has been our in that sense, one of our editors like to say were like a drama critic. We love it when the production is done right. Hate it when they botch it. And so thats what we thats our central purpose. Giving people the analysis, the tools, to be successful. Thats why we focus so much on people. Not the big impersonal forces. All gets down to people. Grandfather liked to say, get to know the prospects of the Company Better by focusing on the head knocker, thats when he called ceos than you will the Balance Sheet. Good leaders, good people, who turn a bad Balance Sheet into a golden one, and bad leadership, time and again, can destroy even the most seemingly impregnable Balance Sheet. Host who are some of your publications your company puts out . Guest the main one is still what we call the mother ship, forbes magazine. A number of investment newsletters, forbes asia, forbes europe, and various publications but the key thing is now more and more electronics. Over 36 licensed a local partner, not conceited enough 0 to think we know every market in the world so we licensed it. Normally varies, depending on the arrangement half the content comes from us, half the content will be created for their own local market. So, that print side is doing well, but were doing more and more on the electronic side. More and more of our traffic is coming from around the world. No surprise. Host what is your role today . Guest my role today is to help out on the marking side, the promotion side. A lot of the daytoday stuff is now down by others, but i still have a day job, and i think given what is amazing around the world is the power of the forbes brand. The reason is not size or anything like that. Think the entrepreneurs around the world sense that with us, were on the same page. We understand your life decisions. We understand what youre trying to do. Oregon pastors who would recognize how you appear is critical in terms of what kind of ability and power you have. I think the one that impressed me the most was xenophon, not a household word today. He was an athenian, aristocrat, a young and decided to go with a group of start mercenaries. Mostly spartans go fight in one of the succession wars in persia two sons, two brothers were jousting at each other and the spartans were hired by one of the brothers and so xenophon went a long and at the time, you know in history the athenians and spartans hated each other. They despise one another. But youre just along for the ride. So here they are in the middle of persia with the opposing army at the brother who won hundreds of thousands. The brother did not. So here they are. They looked hopeless here they negotiate with a winning brothers who tried to buy his way back to greece. He killed them all and so the spartans thought this is the end. No lines of communication in the middle of nowhere, hostile territory. And so xenophon spontaneously didnt go to a military data may come in got up and gave a rousing beach saying we can find a way out of this, and they said okay and in effect, lead the way. He was smart enough to realize that the beginning he must not take the lead. Also, in those days in terms of the army, you have to persuade soldiers. You have to talk to them. You couldnt just a given order and say we are going to march here. You have to persuade them. If you didnt persuade them come you didnt get a golden parachute. So this is high estate. He became the effect of later. They got out, their moments would be lost like you make it sound. It demonstrates a couple things get one a circumstance may come which you may never anticipate. You have to just have to just step in and say do the best i can ever escape. The other thing is he were still not fully in control. There is a point where it looks like the immediate danger was over after a few months. A group of spartans said you are going to get beaten. We are all going to be weaker for it. He it. He just had the help before they got distorted in their senses to reunite. Sometimes things are out of your control and that they went it demonstrates is no good deed goes unpunished. After he led them through this heroic rescue committee gets worse from athens. Your exile. We dont want you back and so we ended up in the days in sparta. They became a farmer and wrote the history is that the source of much cheaper while they learn. Going in and persuading politics all the time. For example, back in the 80s, senator from new jersey, and bill bradley is a democrat saying you ought to run. Ursa and 88 and then in 92. When he thought he was ready, the goal is to lay. Chris christie, new jersey governor. A lot of people went in and say youve got to run. He said im not ready. He showed us, even though he felt he was in. Like xenophon come you just have to go win. Life doesnt always go the way you want it on the timetable you think is best for you. Host is he any relation to the term that we use today, and enough of it . I dont know. Xenophon was not xenophobic. Quite the opposite. Learning how to lead spartans. Host so where would you put yourself on this list of leaders . Like most it would be a mix. Xenophon, the importance of leadership in being able to respond to changed circumstances. One who gets a short trip from history because the greeks wrote it was the modern persian empire by the standards of the time. He was very tolerant. Normally in those days they came killed everybody and sold the rest to slavery. He and the fact takeover of place and say you pass the tribute, we leave you alone. Its by jewish historians like cyprus. He was much more tolerant than some of the others that ruled them. And so again, realizing you cant have it your way or the highway. I think i got to msn for recognizing how you step into an unusual situation and were formed. He was a great performer even after he won the civil wars. He was not a natural born military leader. He had to step in and along the way. But he was smart enough to recognize, too that you dont have to be flamboyant. Julius his uncle, even though he had all of them, he always took care to consult, work with people so that they wouldnt get natural accumulation of enemies and somebody says do this, do that. And learned, survived. He didnt die the way his uncle dave. His wife children at the end. Host last question before we go to calls and text, et cetera. Some of the leaders that you speak highly of i think in power, ambition, glory, offers loan, henry ford and whether they have in common . Why did make a positive treatment . They were all innovators. Ford we know from the assembly line. People forget its even encrypt twice. He almost went bankrupt a third time before he got it right. It was sheer determination that made it happen. A lesson from him was the determination its duration, but that he found the model t. Was the period put yourself in his shoes in the early 20s. He nearly went bankrupt then. Henry ford an estimated 86 of the u. S. Market. Nobody can make it harder cheaper than henry ford. Getting cheaper and cheaper. Your company ramshackle, disorganized, cant compete on price and changed the rules of the game. He introduced the annual model change. You recognize the car just as in a contraption go from point a to point me. As a fashion statement, all the things we now take for granted. They recognize the importance of fashion. They decide each year whats going to be near. From chevy to cadillac they set up a car for every purse. Allowing you to choose color and you can have any color you want as long as its black. Buy in on time, today, not complete without fixes financing. In those days you put the cash up front. For threats along would destroy General Motors by allowing people to car you could move or rack. You could do a mortgage on that. He thought it was ridiculous. It allows you to put a down payment and make monthly payments. And a handful of years it was on the ropes, became the dominant auto company. Even today we still sell at times more cars than toyota. General motors had it own history, but sloan and nonsense was an inspiration. Somebody dominated one area. Politicians and republicans should learn about donald trump, trying to play his game, he will beat you. Device or an sandbox come your own rules of the game. The only way you have a chance to win. He was in his 50s back in the 1950s. Thats like being in the mid60s today. And so here he was selling milkshake machine Southern California and to make big hit in food. Long story short he came across hamburgers and coming donald others. They had a couple outlet and he saw what they didnt see. They had standardized the food business. As you know, the restaurant business, the toughest business possible. The highest casualty rate. Your inventory has gone wrong. Each day you start a new thread this is why you never had a national chain. They were always regional. Like Howard Johnson in new england. National, no way. You realize theyd standardize the business. Get them at, brothers to expand even more. As a milkshake machine salesman. He realized this is bigger than milkshake machines. Ultimately, he bought them out in the rest is great. He then went overseas standardizing the Business People thought could be done. Whenever they come to hand say why dont we go in this area, that area. Can you guarantee me that every restroom, ever met donalds restaurant is they can clean . Well, no. That will go out of our realm. That kind of ability to do big things and innovate in an area again seeing what others didnt see. They didnt know what they had invented. Just as when steve jobs went to menlo park may eventually call them out. They didnt realize what they had. This is unbelievable. Its not just inventing. They need somebody to recognize that the possibilities are. Host steve forbes is our guest. Lori in huntington, new york. You are in booktv. Please go ahead. Caller hi. Can you hear me ok . Host we are listening, sir. Caller i am interested in how you view the Union Movement in this country. It is very influential still and tnr do they help or interview with your kind of reform proposals . Host what is your view of the union . Caller i think they are necessary, but they seem to interfere with a lot things. Host thank you, sir. Steve ward. Guest first you have to make a distinction between traditional and government worker unions can achieve very different things. The government workers unions have got a lot of power and they negotiate with themselves. Politicians know that they are dependent on their support. Weve got a situation where pension systems have not been properly funded. On the industrial side, the very prosperity of the u. S. Especially since the depression, Union Membership has declined sharply. Sometimes come in many times have gotten away from other companies to workers they represent for making necessary changes are the classic is detroit. In the 1970s to early 80s when the japanese decided to put facilities, manufacturing civilities in the u. S. The first one in the michigan u. S. Area because that is where the rupture was for the auto indus rate. They went to the uaw come united autoworkers and said we want to set up shop here and let up factories. However, your work roles, especially the japanese said honda led the way so we cant work with these. They wont work with us. The uaw said no way. You will have the same work roles as the others. Stifling work roles. On the first at a facility for motorcycles in ohio, nonunion and the other manufacturers came in and put in facilities and what they call rate to work state where you didnt have unions. They flourished in detroit we saw what happened to them several years ago. The unions didnt respond in this case to a very changed circumstances. They are stuck in the past and that her. By the way, Union Leaders as a union in the northeast called the communication workers of america. They are big and government unions, but they also represent the strike was for ricin. The cwa work errs Union Leaders were in favor of Bernie Sanders, but astonishingly a good portion of their rankandfile, not government workers, but Industrial Workers were in favor of donald trump. They were quite startled by it. Host well, there is a book that you wrote with your picture on the front that came out in 2005 called flat tax revolution. I think you know what i am going to show here. It is the blurb on the top of a book. A must read for anyone interested in the future of this country, jumbled a trump. Is he a friend of yours . Guest ive known him for 30 years. Back in the 80s when he burst on the real estate scene in new york. I was hoping he would go with the flat tax in the campaign. He came up with a tax plan a tax plan that needs some tweaking. Not bad. But it wasnt a flat tax. It was not persuasive enough. Host have you endorsed him . Guest and make sure hes a republican nominee, i will back him. Host where you support in the primary . Guest none. It was like the dating game. No one ever put it together. We were discussing earlier. I was shocked that many of these people did not lead with Something Like a flat tax for Something Big and health care. Not to pick on, because everybody did. Jeb bush was the governor of florida, came up with more Economic Growth. He said 4 he made 4 gdp growth. I understood what he was saying. 4 gdp growth sounds like a hare formula. Rogaine with 4 gdp. Craig. Theyve never gave people a take away. They never gave people what they call marketing deliverable, how this is going to better the country the way reagan did in 1980. It wasnt just reagan was a very smooth speaker that kind of thing. They had substance. He knew how to put it in a way that people with bad i get it. He understood how to communicate. By the way, even though we all worship, you can all learn how he tried to persuade people who want certain issues im not very much in favor of where he was coming from. How you bring people along. He learned that because he was an attorney and had to convince juries. How do i bring people along so we dont we start with something small and try to bring them along. Understanding sometimes they are not in a come along. But bringing people along, reagan understood it. Most of these candidates did not. People still yearn for that. Host here is a text message that came in for you. It came in from detroit. 313 area code. How can a republican president create changes that would be more favorable to the economy than the democratic new president. Guest because taking Bernie Sanders and to a lesser extent, hillary clinton, Bernie Sanders light. They both want to raise taxes substantially. That is going to be a disaster. They want more government involvement in health care. Thats a disaster in huge missed opportunity for really unleashing great new innovations in health care and better coverage for everybody. They dont understand the fed. On the republican side, ted cruz, i know he dropped out was doing really good on the need to reform the fed. Donald trump has made comments on it, so maybe he will elaborate more. I think trump understands. We will see how your ticket the need for fundamental tax reform, reform and regulation. People tend to think that means youre an anarchist and you want to throw them all away. No. What you are doing is trying to come up with common sense rules of the road that telling you what to drive, where to drive and things like that. Host we have a dedicated member set aside for Text Messages via Text Messages only. Not for phone calls. If you send a text, please include a easter name and city so we can identify you that way. Frida is calling in from little rock, arkansas. You are on with author, journalist, steve forbes. Caller thank you for taking my call. Let me just say that i am disappointed in you, mr. Forbes for not talking fully ted cruz. He was the only constitutional candidate that you had in the back capitalism quite a bit. He thought of your flat tax and adjusted his tax plan according to you and he adopt some of your ideas. Why did you stay neutral . Our country is at stake here and yet all the people conservative, and yourself stay natural. Posts go with gut your question. Lets hear from mr. Forbes. Guest in terms of ted cruz, he did have some interesting ideas on the flat tax, but it was very late in the day before he put it out there and lead with it. In terms of the same thing with the federal reserves, he started to get it. I talked to them about it, but he didnt lead with it. Youve got to come up front on these things and he didnt do the way we are discussing in terms of making these clear in a way that people could immediately grasp. You say constitutionalists. I understand what you are saying about the constitution. Either way, ted cruz should be chief justice of the Supreme Court or at least associate justice sunday. He would be superb. He understands that in a way few others do with history behind it. He didnt go out there and lead the way that reagan did. I was almost bare for him, that he didnt close until almost the end when it was too late. That is why when all the other candidates fell by the wayside ,com,com ma most of them except for governor kasich had established a reagan identity in terms of issues like the flat tax or health care, having patients control health care. So trump was able to beat him. Cruz had an established it the way trumped it with issues like immigration and 45 sales tax on imported. Host will you be attending the convention, mr. Trent or in cleveland . Guest i havent attended a convention in 20 years. I did it for 30 years, attended everyone, so there wasnt much new to cf out. I thought i got more sometimes by watching a Football Game in the midst of winter, you see more on the screen, cspan and others, fox and others are out there covering the thing. So i thought if it is swirling around rumors i would have people like you ferret out what was happening. Host what you remember about conventions in the earlier days . Did you enjoy them . Guest yes, before the goldwater convention, which is no longer around in fandom disco. Back then, they hadnt mastered television. The speeches were awfully boring, but they were authentic. They allow demonstrations and people behaved in ways that really would do today on tv or maybe the democrats will be different this year, where everything is choreographed down to where you said and when you smile and when you dont. 54 was very raucous and raw. The socalled eastern establishment had been defeated. There is no love lost. I will never forget the mayor, watching nelson rockefeller, and governor of new york, a successful candidate make a speech, went out with his wife and in those days, we forget today that divorce is a huge, huge issue more than today. Here he came but they your wife and most of the delegates were goldwater delegates, booed and it wasnt just boot. You could look at their faces. This is the representative of a double. The devil wouldve gotten better reception than the screaming. I thought wow, that is amazing. But that was a kind of raw emotion you would see at a convention. Things are happening. 68. Enough said it chicago, riots in the street with a Convention Going on. Mayor daley wouldnt do it today, obviously passed away, where he in effect said some choice words. Senator ribicoff of connecticut was speaking. We dont see very much of that. Even a semicontest 1976 in kansas city between reagan and gerald ford. Even dare, everyone knew ford had a slight edge. It was not going to be a land like, but a slight edge. Build a totally totally unscripted thing was after ford got the nomination, he called reagan down to say a few words from the stand, with reagan up in the audience loss. He finally persuaded reagan to come down and say a few words. Reagan sent somewhere is probably from the speech he was going to give how they got the nomination. You can see people saying men, do we make the right choice here because he was so good. In 1980, the excitement, the real last bit of excitement was met with like reagan might try gerald ford as the next president to come as running mate for Vice President from the survey co. Resident day. That was swirling around before reagan picked george h. W. Bush. Those moments are rare and more and more it has become that is why democrats have their superdelegate. The conventions of carnation, why not take sure you have all these elected officials who might not have made it, but we want them there to unite the party and all that kind of thing. Normally the Decision Authority been made. Here we have a year or you could still come up with a scenario. I thought about it the other day where joe biden could end up at the nomination. Maybe i shouldve gone. I will watch you guys do it. Host we have a picture of you at a younger age visiting with the u. S. President. Can you tell us what we are looking at here . Does my father, mother and siblings. We were visiting president eisenhower. This is 1957. Host which one are you . Guest i am the one right next to the baby, with a Mother Holding my sister, moira issue is about a year and a half. We were visiting eisenhower. Given its blessing to my fathers candidacy. I remember vividly and eight gave us presents, give us the japan times said that was a big deal. Host do you still have it . Guest yes. For a kid it was exciting going to the white house. Eisenhower was not just the president. He was the man to help with world war ii. It was quite exciting. But it is also a good look at the last thing, even though he was endorsed by ike and Vice President nixon helped my father. He noticed by a landslide in the endorsement are nice, but they dont always sway voters. Host we are going to show another picture. Who is ms picture, mr. Forbes . Guest wow, how young i loved. My father and my mother, brothers. They get a little larger. Host that is you next your father . Guest that is me next to my father. There is more of me now my fair. Christopher, cap, bob and tim. This shows the futility of social engineering. They brought in the same household, same parents in each is very different. Just one example. My brother tim is ice climbing. I think it is nuts, but he actually enjoys it. Ill never forget several years ago we were in wyoming. He lives in wyoming now and they decided to climb and so he went with his daughter and they went up at 1 00 a. M. In the warning. Thats what you do and spent the day climbing up and down. At the end of the day, Late Afternoon he comes back. She is limping. She is in bad shape, can barely move, would take days to recover. And she does this for fun . Whats the matter with this guy . Host some other pictures as we go. Thank you for holding. You were on with steve forbes. Caller yes, mr. Tran war. In my adult life, i dont remember any republican president or legislature doing anything to Bring Health Care to all americans. Dont get me wrong i dont believe in bladders, but why not modified obamacare as opposed to repeal it completely . Guest the reason for starting my tax code, some of you knew with obamacare that the thing is just not. For example, individual mandate. He said we have effectively exempted two thirds of the individuals from the mandate because it would be unpopular. Exchanges are not working very well. Many of these bonds plans come even though they subsidized the premiums, deductibles are horrible. People have insurance, but they are discovering their outofpocket costs were higher than they were before. So they tried to amend obamacare we should move more in the direction of reform such as nationwide shopping for Health Insurance. Right now every state has their own rules. State cartels. I lived in new jersey before obamacare. New jerseys regulations were crazy. I could get a perfectly good Health Insurance policy at a fraction of the cost of new jersey, but it was illegal for me to do it. I could buy lets have nationwide shopping. Transparency they could do tomorrow. By repealing obamacare, i want to enhance the availability of health care. But in terms of getting consumer control, why not mandate the hospitals and clinics come up post prices, roll treatments and services. One hospital charged 2000 for an mri. Another one will do it for 350. U. S. A. Can americans say okay. Lets look at that. How about requiring hospitals to post each month how many patients died from an actions received after they went to the hospital. Its a national scandal. Chipotle food, and a restaurant Food Poisoning at the national story. Thankfully no one died to tens of thousands of patients die unnecessarily from infections received after them to the hospital. People dont know that. They should be public information. You should be a should be about a choose your own Health Insurance policy and set about the says you should have. I dont need pregnancy services. We should choose what they fair protect their needs. Those are the kinds of reforms we outlined in the book it would be very positive and have more effect to come out like we have with food, more effect if safety net, more Affordable Health care. We see little snippet of it. Little snippets of what can come. For example, basic surgery on the eyes so you might not have to wear these things. Plus about half are in real terms a fraction of what it did 15 years ago. Why . Because you dont have to disconnect between providers and consumers. They make it more affordable, more attractive. Our publisher in our book, reviving america. Is that i could get it done for 2500. Perhaps even a better result. More for less. Cards manic surgery has gone sevenfold in 20 years. It is between you and the provider appeared to scope it out like anything else so you havent the wild inflation youve had ulcer. Tried to get the best of all worlds and that of a system where they have more and more rationing. I will give you one example. I know im going on, but this is critical. One of the virtues of free markets is to get information out quickly. When something works, everett imitates. When apple came along with ipad and iphone, sam song would say our product is better. You dont find that in health care. One example, Breast Cancer. You are told that a certain age if you are a woman to get the. Do you realize if you have dense tissue, mammograms have a very hard time detecting cancer . Theyll make it about 30, 40, 50 of the time. Theres a new new way of doing it part in the eye. It is called metabolism imaging. I would get the name here because it is important. Lets see what we have here. Ill find it. Yeah, molecular imaging. Look it up. It comes from the mayo clinic is the one pushing it. A reputable and contusion. So if your spouse or friend or whatever, it is light years ahead in terms of detecting Breast Cancer if you had dense tissue. Why havent we had more publicity on that . Critical information doesnt get expanded as rapidly as it would in a normal free market. These are truly lifeanddeath decisions and that is why i dont want more of the same trying to improve what we have now. Providers know they have to satisfy you the patient. When you are in charge, i guarantee you it will be a very different next areas. Not perfect because we are human, but far better than today when you go to hospital. Host joseph in santa barbara. Go ahead with your question or comment. Guest good morning. It took me three years to get on and im happy to be here. Mr. Forbes, i am happy to have you there. I would like to first i am a registered independent in my 70s and ive been watching cspan sent the very beginning. My concern and i would like to get your opinion on his aleutian is that we have a situation where our Congress Makes the laws, but when it comes to the rulemaking and regulations, that is done by unelected bureaucrats the problem i see there is of course they are mainly primarily liberal, protected from fire and it doesnt matter what administration is, whether republican or democrat. They continue to exist. It is almost like a fourth part of our government, which is not in the constitution. That concerns me and i dont see a lot of talk about it. Host listen to steve forbes. Thank you for watching. Glad you got through. Guest thank you, joseph. You bring up some and critically important. That is most of the effective loss today are not made by congress. They are made by these agencies of the government apartment. In 2014, for example, Congress Passed 115 per 114 loss come the agencies pass the equivalent of 3400 laws regulations of the force of federal law and 3000 others in the works. Too often these rules and regulations are made based on more ideology and win rather than science tried to fight them. Very difficult. People dont know. We were discussing in the show people dont know they are committing felonies. If you go on a federal land, walking your dog. If your leash is longer than six feet, you are committing a crime. Put aside whether they should be regulating the likes of leashes, but they commit a federal crime is preposterous and the code is littered with his staff just on the federal code alone. 5000 laws they think they can even count them all. From the regulatory agencies you talk about, 300,000. One step in the right direction, senator hatch of utah is pushing this as a number of people in the house, the house got bipartisan support, havent gotten in the senate yet is put in and amplify what they call mens rea, latin for guilty mind. In other words, if you dont know that youre committing a felony when you have a long leash, they can throw you in jail. So you have to know you are committing a crime before they can do it. That innocence is a reform that senator hatch and others want to put in this new crime bill theyve been discussing in congress. That would go a long ways to the arbitrary situation where rules are written in language so its up to the bureaucracy to interpret what they really mean. It goes against the rule of law. The world plot is based on if you know what the games are inviolate, you will pay a price for them. Today is the book by harvey silver grade. Three felonies today. That is all too true. If uncle sam wants to get you, he can. We should change uncle sams name to uncle tyrant in that sense. The hatch reform would be a superb step in the right direction. There are a number of institutions. I was at a dinner the other night that are fighting legally its excesses and pushing legislation. On the regulation that cost more than 109 a year. Congress must vote it up or down. They just cant say thats out of our hands. They have to take a lecture or responsibility for it. I think people need to learn more about how dangerous the situation is in reforms like the hatch reform for some of these other bills that give the city say more power more accountability to our elected officials so they cant hide behind the regulatory state. All of those to be good steps in the right direction. Host from his book freedom manifesto, steve forbes right they are increasingly being treated as criminal offenses by federal bureaucracies that are increasingly resorting to the use of force. Joe was in lakewood, colorado. Good afternoon. Caller good afternoon. I thank you for hosting him. I have enjoyed your insights and i was wondering about your position on Getting Health Care through your employer. To employer. You sounded like he didnt see that as a good thing. When the company downsized about the java nospace and 13,000 to your cobra. But i would also refund of cost 17,000 to 22 also because i was group that over 55yearold Insurance Risk pool. As a consumer that towns like a better option. I was wondering what problems attendees thought since i wasnt able to find better cheaper plans. Should we be looking towards the Blue Cross Blue Shield model of nonprofit Health Insurance . An interesting question. A couple things to touch on. One reason and by the way, an employer wants to provide Health Insurance im all for it. We think the way we do it is very tracked it for getting and keeping good people. One of the challenges is you mentioned you had cobra, which was very expensive. But because of the tax situation, if youre an employer or selfemployed, you get to deduct your premiums, which effectively reduces the cost quite a bit. If you are an individual who either want to change jobs or lost a job and has to go on cobra, you go on the individual market, you have to pay with aftertax dollars. Already you are 30, 40, 50 behind. That has got to change. Since the markets are all geared now for employers and third parties, with the changes we are taking talking about camille got the development of an individual market in one of the reforms they have to make this make it feasible and easier when you leave an employer ,com,com ma you all may insurance policy. If it costs 13,000 Companies Pay 13,000. Its not 17 or 22 or 32 and have to go on these exchanges we have a 50,000 to. About and have to go to a specialist 500 aisles away. That the system we have to change. Those changes are very feasible. Again, when hospitals and clinics no big view the individual actually controls the dollars, not the employer. Employers too often and we are sort of guilty of it. We try to do our best. It is onesizefitsall. We offer a policy and we think its a good one. Especially the 2500 we give you to meet the deduct the full cash. You may conclude your particular needs. You should choose what meets your needs, not what an employer thinks. You can get it through the employer, get it through your union and an association of fraternal order or whatever an individual market of it just like Homeowners Insurance or car insurance. I want that kind of competition and the guy goes a, whatever you call them, saying weve got Something Better for you. We can do it cheaper for you. Thats the competition i want. I want you to control those dollars. By the way, one thing on this. Because of the system we have and nobody could find it. People dont realize how much they actually pay for Health Insurance. Not just adjustables and copays. Its also the taxes you paid to the federal government to finance medicare, taxes you pay to finance a portion of medicaid. The taxes you pay to finance a portion of medicaid. Salary mightve lost because the company has to buy the Health Insurance. That couldve gone to to you in terms of salary. It had to over your lifetime without you even knowing it. You effectively spend 1. 9 million on health care and most people have no idea what the true price of what they are paying is. Host for every author we have on in depth on booktv, we ask him or her for the books that are currently reading through some of the books important to them, their influences. Here are some of steve forbes dancers. They are maligned because because we will be coming back to take your calls. Leaseback i think divided government is probably the only time you can do a transformative things. Ill give you an example. Reagan and tip oneill receded for Social Security. The last comprehensive tax reform. Bill clinton did welfare reform actually balance the budget. Big stuff. Arguably, none of that could have been done in unified government. Steve forbes, you list alexander hamilton. In remembrance of alexander hamilton, by few others before or since. You showed that money, properly understood is the root of all good. Guest yes, when he became treasury secretary, the u. S. Was a junkbond nation. I guess for shambles, finances or shambles. He studied the bank of england, how britain, because of its finances, was able to beat the french empire. So he wanted to take some of those basic principles here. One of them was he realized the need for table five for money come as you fixed the dollar gold to institute a system for government to have a reliable source of revenue. He took over state thats because he wanted debt holders around the country to have a stake in success of this new enterprise. So he took the shambles of the death situation from the revolutionary war, rationalized it and he established the mend. He got a system of finance going that was critical and underappreciated by historians. Maybe they will get people to look at him again in a more serious way. The critical reason why we went with a small east coast nation, largely farming to the industrial nation of the world within 100 years. Extraordinary. And even more impressive than what reagan did. Hamilton put the system and that made that possible and we take it for granted. Host have you seen hamilton . Guest i have it. You will probably be three years before i can get a ticket. Host 202 is the area code if you want to continue with her conversation with steve forbes. Well put the phone might the outcome of social media and attacks addressed. This is for Text Messages only. It is 510 3405559. Vatican is for Text Messages only. If you would like to send one, please include your name and city so we can include it that way. I do want to go to a text message weve been holding here. This is from scott, wilkesbarre, pennsylvania. Mr. Forbes, would you consider a cabinet position in the trump white house, particularly secretary of the treasure . Guest the answer is that any president calls you, you take the call. It is not likely to happen for a whole variety of breeds, but i am glad he thinks i would be qualified to get the call. The key thing is to make sure the ideas are ready. The key thing is whoever is president not only understand the above make clear to his or her staff, dont get in the way of the reforms that are needed. One of the bands of the cabinet secretary shifts today and really frustrates governors is when you come in, you find out the president is not just her boss. Its not just going to capitol hill. You have the staffers who know more than you do and dont mind trying to show how smart they are by micromanaging you. You have to set up the rules in advance. Whoever is president , its donald trump, which he was ahead today and can change. Whoever it is, i will be sending my ideas even though im a scotsman, i will send them a free copy of my book. Host why do you say would not happen for a variety of reasons . Guest there are a whole calculus of decisions and factors that go into picking a cabinet member. Taking care of certain parts of the country, certain parts of the party, certain groups that you want to show you attended to. We have some crisis in a jet. Find somebody whos a recognized expert in a whole variety of things. Its not just one post. It is a number of posts that go into this thing. When you read how it is actually done, its kind of a helterskelter thing. It is partly science say it will come up with 10 names in blog, blog, blog. At the end they say this person may be good, but we have to use Political Capital to get him or her through the senate. Even though they might be good, maybe we should save our Political Capital for something else. I am keeping my day job for now. Host raymond in texas, go ahead with your question for steve forbes. Caller thank you, steve. My question is on the Gold Standard. The gold is a solid currency in regard to keeping our sovereignty as a nation and having a solid current date that is impenetrable. It is a standard going along with the law of economics. That currency drives out good currency. When we got off the Gold Standard, we just had that currency. Thats just my opinion. Now when other countries go up in currency, what other, it hammers ice. The punishment affects everybody here in our treasury, every citizen. The law doesnt respect personality. It is solid. Either we can form to have something stable, like what is going on now in the government, honesty. Honesty can be considered a currency of exchange as well. Host raymond, could you wrap this up it would get a response . Caller yeah, that currency doesnt choose sides. To wrap it up, what principle we need to get back to, debate six that we yield to. Go ahead. I am through. Guest thank you. When we are on gold we would be a trillion dollars figure a comment today, 40 years compounding hurts because investing is risky. You dont know what you will get back in. You get less productive investing and when you had a fixed value for the dollar, guess what happened, you had less currency trade. You didnt need it. You when you go from texas to oklahoma you dont have to worry about what the dollars worth of oklahoma versus texas. Its the same currency peer today, having all of these floating currencies, currency trading on a daily basis is 5. 3 trillion. More than stocks and bonds put together. Tens of thousands of the best minds in the world focus on trying to make money trading currencies. Huge waste of resources, huge waste of brainpower and thats why we have to get back to a Gold Standard. Also, you hit the word trust. Trust is what makes a currency work and when you lose trust, then at it leads to all sorts of social problems. Such as there is 12 inches and a foot or 60 minutes and that our, a Stable Currency would make life a lot better than what we having going through. Host here is a text message from Northern Virginia what is your thought on bit coin . Guest it might be a hightech crime for help. These rose up because of a lack of faith in the dollar and a sense of wanting privacy. The challenge with a bit coin as i see it is that its still unstable and value. Lets say you get paid in bit coins and in one week you could buy stake in the next week you could probably get secondrate hamburger it is so volatile, so they had to find a way to stabilize it, but what is coming out of these crypto currencies like did coin i think is a new Payment System. We dont realize how expensive and complicated our whole Banking Finance Payment System is today. We think we will go to the sword we swiped our card. Is that magic . Yes, it is, but you asked the merchant why yet the pay 3 for that card swipe, so what bit coin shows is that you can do this for a fraction of this Payment System of what we have today. Good news for some credit cards, not good news for american express. In terms of electronic banking, one of the countries that leads the world in the electronic baking because they have to come in to have choices kenya. They cant have a traditional system and so here, Technology May come to the rescue not only the cost of transactions, but for developing countries just as handheld devices in terms of telephones, youd wouldnt have to have all these telephone poles and traditional infrastructure. You could get around that with these handheld telephones and handheld devices, so too on banking. You may not have to have all the infrastructure we have today. You already see online lenders beginning to emerge who can do it at a fraction of the cost and far more efficiently than the traditional system. So, if you arent thinking its not just government regulations killing you, the web may do to you what it did to the print industry. Host in your book, freedom manifesto, we are taught in grade school that Thomas Edison invented the incandescent bulb because he wanted to create better lighting. True or false . Guest he always wanted to do things better, but what this goes to show is that Human Emotions are there and the key thing is to channel them in a productive direction. Thomas edison was mad at the gas man and in those days gas was the chief source of illumination and being this he was always flowing behind at his bills and we have a note from his grandfather in 19207 edison a note about this legend about why he invented that incandescent lightbulb. Edison wrote back to my father and said yes, it is true. I was paying 5 a day to postpone a judgment on my small factory, then came the gasman and he cut off my gas. That made me so man that it ran up eight Gas Technology to see if what electricity could me used to replace gas and i stuck to it, but i did not hurt that all except lately, 40 years, so his anger at the gasman and edison go for the incandescent light bald and traditional to replace traditional gas, so when you get angry think of how you can make money as of this. Host joseph in carmel indiana, hello. Caller i would like to hear your critique on the ferret tax and whether you think donald trump would be opposed to the fair tax because it would hit rate big real estate products a hard . Guest in terms of the fair tax is, its National Sales tax and we discussed extensively in the book several pages and effective race rate is not the 23, its the real rate of 20 , so if you go in the store and buy something for 100 you will pay 30 sales tax on it and its meant to replace the income tax payroll tax and primarily, but the challenge with the National Sales tax is severalfold one is political and when you say 30 rates, people recoil. You can talk about embedded prices all you want and you just think oh, my gosh i will have did buy a new house up a 30 tax yes, he will, so that is a challenge for the other challenge, which is also important is the 16th in the mid to the constitution. 16th amendment allows washington 21 income tax. If you dont repeal the 16th the memo to the constitution i guarantee you you will eventually have as you have in most countries and in both states both on income tax and a sales tax. Like in europe, they have high income tax and a value edit packs which is sort of a sales tax. So, you have to repeal the 16th amendment and then you have two challenge compliance. Its one thing to put a tax on a product, but what about services . When you get high rates, then people have a huge incentive to get around that. Kid comes and cut your lawn, you going to pay 30 tax on the . I dont think so. We talked about the fair tax, that they are 30 tax on a new house, but not on an existing house. Then you get in the problem defining what is new and at what is traditional house picked lets say you take a traditional house and you got the thing and keep the sod baby and redo the whole thing. Theres a 30 sales tax applying to that . You have to deal with these particular questions. Then, who collects the tax . Fair tax people, they say they want the states to collect it, but will only pay those states one quarter of 1 to collect. Not much of incentive. The state will make sure they get their tax, but they dont care about uncle sam. You take the 30 rate and combine it with states like california to eight or people think 38, 40 sales tax is hard to sell and yet the definition problem, the definition of on example sales tax you buy for your business and you dont pay the sales tax, thats what fair tax people say. Lets go to home depot and by some lumber and say im using it to build furniture for my business. Whos going to check to make sure you just didnt do it for your own Home Improvement and you used it to sell something online . So, you have real thorny compliance problems. You can probably get around these, but i went changed now and a flax tax has been done around the world. We can do it quickly, maybe fair tax can be done with education in the next generation, but we need action now. Host someone wants to go out and buy your book, which of your books would you recommend . Guest well, all of them. They make great you dont have to go to college and you can just get these books. I think in terms of the political season, reviving america explains in ving america explains in a great board way big things that need to be done and we have to get these issues out there, not just in the election season, but next year at the federal level and also on the state level. Healthcare, 20 of our economy. Gets the most personal thing possible and affects all of us. Clearly, it is not working and the whole idea into this is where the candidates fail, you can turn what looks like a hopeless collocated mass mess into Something Dynamic like hightech when we all come out ahead. This is exciting stuff. Host from your book money what kind of society sells a lifelong burden of indebtedness to people and experience with money . You mentioned college. Guest well, we all now its even two, three years ago college debt was beginning to emerge as an issue, but now its well over a trillion dollars. One of the things that has happened with good intentions is that cost one cup, government came in, subsidized loans, pell grants and the like and what he did end up doing . It ended up raising tuitions and so you are on a vicious cycle. Look at the growth of administrative costs of these institutions. That is the tell tale sign that goes up faster than teaching, actual Real Laboratory research, Scholarly Research and so there is a lot of bloat out there, a lot of nice big buildings and swimming pools. Nice, but not the essence of learning, so the students and that coming out of college especially graduate school where you really see it where you have a mini mortgage and no house to show for it. Right now, because of these mistakes weve been making it is pummeled the job market and so prospects are being able to get this off your back in a few years received in the environment and within the government has incentives where if you work in government you get a faster payoff forgiveness than if you work producing things in the private sector, which is bizarre. We want people to produce things. So, its battle around. By the way, it can be done in terms of controlling costs and i think parents should wake up to this. Just talking to the present of Purdue University who has huge experience in this town on budgeting. He is successful executive in the private sector, very successful governor where he turned a state i was in trouble into triplea credit, midwest, no energy, no hightech, real hardware. Because he has been able to put in the system and control expenses for almost five years now they have had no tuition increases. If you look at phenomenal institutions, most are 60 plus thousand. For purdue its still 48000 and when he first put in the policy no more tuition increases, it tells the story. The Admissions Department said this will hurt us attracting students and he said what you mean, if our price is less than others people will think we are unable to hear your where we cheaper. Must be we are not as good. Now does the opposite. Now they say can we say again there is no tuition increase. He also makes a very good point, this again gets too we have got to get pressures from parents and others he said you dont go into these institutions and think you take a axa cut off a lot a fat. A better analogy is that the fact is marmol throughout the animal and so you have to get people inside to work with you and put incentives inside to cut out these unnecessary costs, but over time it adds up. That is the model of produce. Host mr. Fords, you are the father of five daughters. Have you figured out how much you have spent for College Education . Guest i dont want to know. [laughter] guest yes. The thing is, parents want to do it. But come i think now that initial admission Admissions Department response to Mitch Daniels, president daniels is that parents are now saying more and more, what are we getting for this money . What are you getting as a student . One of the and this leads to pushing kids to do more economics, more business, but you also still want to have a system where they can do the humanities. Steve jobs understood humanities , sciences are not pull her off assists each reinforces the other. They are intermingled like that marble in the animal. Norman forelock, the famous norman l prize created the green revolution which saved hundreds of millions of people around the world from a famine. Huge advances in seeds. He majored i think in chemistry or whatever in college and i remember him addressing students at a graduation 20 years ago and he said to students, he said dont specialize to early or if you do, make sure you take courses outside of your comfort zone. He said you never know why to you might need to draw on in life. When he started to make the breakthrough in the green revolution he said he knew about economics, which i did not study very much. He said he needed to know about politics and all of these things that were outside my immediate sphere. See it as a way of exercising the mind and one thing purdue does come i think i get this right is that daniels discovered when he went there that they had a core curriculum, but it had 363 courses. Like ceramics. So, what he did what they did is put together what you mica a package of courses. So, you take real humanities courses because most of the kids who go there are engineers. The incentive of taking this package instead of taking a course or that might be easier or not have to go do class on saturday or sunday or whatever. If you take that package of a certificate, not just a diploma, but her certificate that you completed this course and humanities. What next to thing you can add it to your when you go out into the workforce. So, yeah, colleges right for entrepreneur innovation. Host john, Ocean Springs mississippi, on the line with author steve forbes. Caller hello mr. Forbes. I am interested in your thought on the Obama Health Care repeal and i wonder why you didnt look at the bush care Prescription Drug program to be repealed. That Program Costs about 70 billion a year and has the highest drug costs in the world, i believe. I have the va programs and the negotiated drug prices are half of what [inaudible] caller no negotiations in it steven lets get a response. Thank you, john. Guest in terms of what they call i think part d of medicare which is the drug plan, i think thats it, maybe its part c, but anyway the challenge there is again the whole medical system, Healthcare System does not have real free markets. One of the things that badly needs are formed is the whole area of approval of new drugs, fda largely still has the mentality of the 1950s. For example, they love clinical trials. Back then it made sense, but for a lot of these new drugs today for cancer, why should you have to take a placebo when there might be something already there that can help you out with a disease that can kill you . So, they have to radically reform and i think if you get effective reform there so you dont have to spend 2 billion to bring a new drug to market, which is what you have now, when you go overseas, for example, those countries when they buy drugs from our companies here in effect get it at low cost because they dont pay for the research and development of 2 billion that winning to create create the drug. So, if we get reform there you will get more drug rate hurt makers. Right now i coming that starts out with a promising drug often has to sell out or partner with an existing drug company to get through the maze of the fda, which ends up costing us. So, again i think that would be ripe for form and what george w. Bush did on that part even on the cost came in below estimation, one thing where government didnt underestimate the cost, youre right, its part of the whole problem and cause a lot of anger among republicans. This eventually led to their defeat in 2006. So, gap more free markets, more consumer Patient Choice and we will get again not a utopia in healthcare, but it will work where you will get more for less. Host jim, anchorage, alaska. Hello, jim. Caller hello and thank you for taking my call. I got a small question concerning healthcare. Currently, when a person is discharged from a hospital he or she can receive bills one, two, three, six months, a year later and these bills come from labs, the doctors, the hospital and they are also harder to read. It looks to me as though with computers and if all groups that bill knew this that when that patient left the hospital they would have one bill they would have their bills there on time and the patient would more easily know if the charges were applicable to that particular operation or whatever. Im just wondering what do you see as impediment to this type of billing . When you get a car fixed to get one bill. You dont get a bill for the knots, and the bold, the person thats working someplace else. You dont get different costs coming in and im just wondering what your thoughts are on implement in such a procedure. Guest you hit on a system where the patient is rolling out the customer, but third parties. Government and large insurers, the insurance commies, the government and employers and if you go to to a hospital or a clinic today and you ask what a treatment will cost because we have grown up with the system we dont realize how strange this is, you get a very strange look. Its means either you are uninsured or crazy. Why would you want to know the price . Whats it to you . They tell you insurance will take care of it and then we will send you if you oh anything, so they want to keep you passive and they want to keep you ignorance and invest the way the system is geared. Whereas, if you make these reforms where the patient has that Consumer Power they know they have to and you are going to be saying yes or no on whether they get paid, they will have a different attitude here even with computers today, you cannot read unless you are a genius the bills that you get. You try to file for a claim and by golly he wrote about trying to cope with bureaucracy and you feel absolutely lost and bewildered and no hotel where as you pointed out or car repair would dare give you a bill that you normally get from a hospital and because it is thirdparty payer not you the patient, you end up getting they say that Insurance Committee takes three months to decide how much the 500 think is they will cover and how much you will cover. They have over 20000 different diagnostic diagnoses, whatever they call them, so you have to talk to your doctor. If its one kind of the ticket diagnosis, insurance wont cover it or maybe over cover 50 , but if it is almost like it they will cover almost 85 . Its an insane system and thats why we have to get it simplified, back to user consumer and we wont get these crazy situations and you will know in a dance. When you are in and charge hospitals will tell you this is what it will cost. You see signs in pennsylvania there is a hospital chain called geisinger and several years of the instituted legally they cannot call them warranties, but in effect if they dont do something rights the procedures on them, so if they botched the operation the next one is on them. You would think a normal market everyone else would quickly have to do that like with automobiles if one come he says we will give you a 10 Year Warranty the others quickly follow suit. Has not happened in healthcare because its thirdparty pay. Its not you the patient and so you get hospital rooms that look like an old boarding house with everyone jammed in and we have grown up with it so we dont realize how unnecessary and crazy it is even though a lot of that equipment is fantastic with a lot of smart people. The system itself just is not working. Host gary is calling in from lopez island, washington. Hello, gary. Caller hello, steve this is gary your friend from freedom fest. We did some stage plays together see to oh, boy. Caller wanted to ask about the Gold Standard. On the state level some state legislators are advocating gold. Some state School Systems are stockpiling gold and overseas Central Banks like russia and china and so me others are favoring gold over paper. Is it possible that that kind of creeping gradual Gold Standard will start internationally and here in the United States . Guest well, i think getting a Gold Standard and this is one reason why we wrote the book is so the people get an understanding of what the thing actually is, not this myth encrusted thing that we are told by economists. Its very simple like having a ruler with 12 inches, does not restrict the size of a building you wish to construct. It just means you have a basis of measurement to make it possible to do construction efficiently and safely. Same thing with the economy having a Stable Currency. So, what you might call the idea of framework is beginning to be laid. The chinese have been studying this foramework is beginning toe laid. The chinese have been studying this for several years and i would not be surprise within the next decade they dont mess up their Economic Reforms they are trying to do now. China goes to a Gold Standard before we do. They are beginning to realize the necessity of a Stable Currency. So, i think yes, its beginning to happen and the more we get people studying it, what it really is and what it is not, i think you are correct it will happen. State level, the states can contribute to it by doing what you talk and others have done and one of the things we could do in the meantime in this country is remove the barriers against alternative currencies. So, if you want to establish your own currency you are free to do so. You dont have to worry about the fbi throwing you in jail. Thats not counterfeiting, just an alternative currency and especially with high tech. Becomes more and more feasible, so remove all those barriers, tax barriers, regulatory barriers and something might emerge in the marketplace that we cannot even conceive uptodate. Host heres a text message from the 717 area code. I think thats pennsylvania; mr. Forbes, what you think that mr. Crumps idea of bringing jobs back from china . Guest we wont bring jobs back, what we will do if we do things right here as we outlined in the book Foreign Companies will be investing here on a level we cant even imagine. You got a little favor of that the 80s when we started to move ahead in the rest of the world. Auto manufacturers came here because it turns out we could make cars as good as anyone else we do not have crazy work rules. Chemical companies are coming here now because we have low energy costs. So, you get the right environment and capital will flow into this country and who knows in terms of manufacturing. What will be done, 3d printing and other technological advances in terms of making robots. Robots have been with us forever yet we dont realize a washing machine is a form of a robot. Instead of washing with hands we have machines, same things with dishes and the like, but now with Laser Technology they can be precise in a way and cheap in a way where you can make close that are now done in a third world and you may able to do a. You wont need many people, but Laser Technology is very promising. Instead of thinking of us losing, creating, i want an environment where Everyone Wants to come here because we make good currency, good legal system, good tax system and you want to be here. People when they look at their uncertain governments they are around the world even now with all of our troubles, we are in trouble, but we are better off than most of the rest of the world, which is why they want their kids to go to school here and why they want real estate here. They realize this is a safer place then just about any place else in the world. Host and the most recent book by steve forbes and Elizabeth Ames, reviving america. Want to play some video and you will be able to see it right there and you will know what this is about. Its from march, of this year. They put me down at 4. 5 billion thats worth. Im not complaining, but its much more than that. I couldnt understand why is it that forbes just raise me 400 million this year. I should be happy; . What difference does it make . Can understand, wire forbes numbers so much lower than the value i dont. Host what was that about mr. Forbes . Guest donald trump always thinks we underestimate his wealth and we go through this every year and the essence of it is putting aside various properties. The essence of it is what he thinks we should put several billion value just on that i love his name. In terms of how we value wealth, we say you monetize it and then we will counted as value and we do this for everyone, not just donald trump, but opera and others pick they may have value, but you monetize and charts were something. Thats the biggest, thats the big difference, but he is irrepressible. I have to tell you a story i shouldnt, but i will. Its in the magazine. We did a story on his wealth last fall for the 400 most richest list and he disputed as he did their. He thinks its more and so editor when up to his office the same day that pope was a new york and so trump tower has a balcony, so went out on the balcony and a lot of latinos down there and so there are some cheers for donald trump, but there are boos as well a trump turns around and says he, 90 approval. Then, he says the shows that youve also under estimated the value trump tower. The pope chose this building to begin his new york parade and so he is its like steve jobs. Trump tries to make the world as he thinks it should be and it can be a shortcoming, but it can also be a source of his strengths. He doesnt see whats there, he sees what he wants it to be. Thats what has made him in real estate he made these buildings with his name on them, he made it happen. By the way, whatever you think of him, whatever reason he exceeded against all expectations number one, he people knew him because hes been on tv for 410 years. People felt they knew him. He started out with even higher name recognition than jeb bush. People felt they knew him. People felt what also helped was because hes in real estate. A building just doesnt happen. People could see. Big building, he made it happen. You dont give a speech at a building rises that. He made it happen and thats with gave him that initial credibility. This is more than software. You cant feel it the way you can see a big building or bridge or golf, whatever. Thats what gave him his original authority. Again, as we were discussing earlier his challenge now that he is the nomination locked up is taking it to the next step and recognizing everything he says now will be examined. He thought he was examined earlier, he aint seen nothing yet to what they will try to do to him. He has to put that Team Together and take it to the next step. Host where did the forbes 400 come from . Guest came from my father back in the early 80s. Thought it would be fascinating to see who had it, who was losing it, who is making it, what areas it was coming from and so he said to our editors we are going to do the 400 and he picked 400 because that in the late 1800s a man had the 400 of the new york most powerful people so it sound like a good number, so my father went with it. Our editors fought him tooth and nail and said, this is not like a publicly traded company where you can decide what shares are worth and what capital is an all that type of thing. How can we do this, cant be done, so finally my father said you are not going to do it, im going to take im going to do it myself. So, finally they got together and put the Team Together and started to do it. As we made clear these are estimates. In some cases you get cooperation and in some cases you dont. He talked a bank or spirit you talk to competitors to get a good idea of the range and my fathers hunch was right. The volatility each year, yet five, 10, 15 change as people move up, go down and it lists whos on and who came off and who was on a few years ago and fell off. Energy sector, a lot of those people had taken a huge hit, so that churn is quite amazing and you see the same thing around the world. When we think of wealth we think up piles of gold, no, its here today and gone tomorrow as we have found out as we look at the price of oil. Host do other people like donald trump dispute or want to be on the list . Guest donald not only wants to be on the list he thinks we never get it right and we are always too low, even though we have gone up. Several years ago it was 2 billion and he thought it was for now, we have in a foreign half and he thinks it should be eight half or 10 or pick a number, so we are always 50 behind in the way he calculates, but a lot of others want to be off of it. I think that classic case was in terms of complaints was a fellow called up several years ago furious and it wasnt so much our estimate that he took issue with, it was that he was on the list because hes in the midst of a divorce and he did not want his wife to know what he had. [laughter] guest we found it. Host who is Sabina Beekman . Guest my wife. Been married now almost 45 years. We met 46 and half years ago at a party and sitting next to each other. Amazing what chance plays on these things and i being a smart alec offered her a cigar. We were at a posh club and without missing a beat she took it up and delete it up. [laughter] guest she said if you want to play that game i can, also. Host you have five daughters how many are involved in forbes media . Guest right now, one, moira who heads up the womens side and various conferences here just had a very successful one on womens conference. The others, to are scattered around the country, one is from dallas and one is from seattle, so but they all got through the team years thanks to their mother. One thing i recommend for parents especially with teenage daughter and one is the mother just brace for it, you get it more than the father does and remember, very different context what lincoln said, this too shall pass. Host scott tweets into you fathers day is coming up. What do you miss most about your dad . Guest just the everyday interaction. He was one of these originals. You never knew what was going to. He was always thinking, so it was constant. People base their addicted to their handhelds and always wondering what will they come up with next likely couldnt even conceive the like that issue of the 400 and he was intrepid. Talking about motorcycles, i would not ride one. I love looking at them. They are beautiful things, but as he got older, he rode them more instead of less. In his late 50s he would come into new york on a motorcycle and even worse, he started to write in the city. New york city streets with all these potholes. Generation role reversal. Kid telling the father, daddies are dangerous. You could hurt yourself. Be careful and he did have at least three serious accidents on motorcycles and one nearly killed him. Didnt stop him. Guest purple passion, and it was, personal perfume that kind of gesture, yes he loved to doing that. Host do you still have the plane where the ship . Guest we dont. The plane was a 727 and talk about fuel consumption, no. It does not work. And the boat, no. Six years ago it became plain. Good for advertising and getting business because no one else had one, but it lots its ability to attract business, so a scottish flood came and, costeffective, no. Beautiful, but not cost effective. Again, that gets to the tools, change with the times. Host next call for steve forbes. Dave. A low, dave c3 good afternoon at cspan and the wonderful cspan audience and good afternoon to you, mr. Forbes. Im a reader of your magazine the last 50 years on and off and its giving me some wonderful ideas. Guest thank you. Caller going on to Social Security, im really a little bit upset because if i talk to 99 out of 100 people everyone thinks its not going to be there. Its going bankrupt and they are so misinformed by i hate to say it a lot about media. Now, the question is this and i will draw the picture, you remember the early 80s when greenspan, tip oneill and Ronald Reagan in a day or two Social Security had a 50 billion surplus. In other words, it was close, but not bankrupt, but it was close. Today that surplus is close to 3 trillion. Now, you started up in the program. Your datagram father said money should bring happiness, not pileup. Dont you think it would be a wonderful thing for our economy that the people who helped get that surplus, mainly the baby boomers, now get additional benefits before someone comes in and takes it and literally steals it cracks your thoughts, please. Guest interesting question and the sad news is the money has already been stolen or its already been spent. That 3 trillion surplus or socalled trust fund, the trust fund in name only. The only thing that trust fund has our ious, nonmarketable from the us treasury department. Social security money comes in when our payroll taxes they are immediately spent and given ious to the Social Security administration. Remember five years ago, we nearly had a default on Us Government bonds because we were not going to raise the debt ceiling and there were fears people would not get their Social Security checks. Well, if you had a 3 trillion surplus and marketable government securities, that would pay for benefits for four or five years, six years. But, the money was not they are. It had already been spent. If a private company did that, took money from their workers, spent its and then gave a nonmarketable iou, those executives would go to jail, but in washington that is considered high finance. So, that 3 trillion, to an apt 3 trillion does not exist and one of the things i hope the next president will do is take some of these nonmarketable ious and substitute salable government bonds, take them out of the federal reserve. Did that complicated, but i think it can be done so that if you do get a crisis again you dont have to worry about people not getting their Social Security checks work that 3 trillion is also supposed to be a reserve like a pension fund or 4o1k to pay future benefits. Its not just for those on the system today, but not only pay what they get today, but make sure the reserves are there when revenues start to come in less and as our baby boomer generation retires, so those are supposed to be reserves like Pension Funds and 4o1 kays and the like. So, in terms of Social Security, the key thing is we do have enough wealth in the economy to pay for the current promise benefits for those on the system and those who will go on a system for the next 10 or 15 or 20 years. The problem comes with younger people, people in their teens, 20s, 30s. Their system will not be there for them because its payasyougo. There are no real reserves there, so thats why i think for younger people, they should put in a system where part of their payroll tax goes to their own personal accounts with plenty of rules and regulations about diversity, diversifying and cant spend it. But, is there property. Right now those benefits you pay it each year you get a notice from Social Security sane what you will get under certain assumptions and you think this is money that they are, it is that. The courts have ruled that you dont own that money at all even though you contributed it. They make is how might seward yours. So, i won a system especially for younger people where they actually own that money, own those assets and politicians cannot play games with it like they do now where they say there is a two and a half or 3 trilliondollar surplus and it does not exist. We should not do that to future generations, but in terms of the system today we get normal growth rates in this country, normal productivity, the system for us and for the next coming generation is there to pay the promised benefits. If we continue to make idiotic mistakes which we have been in recent years been there will be nothing there for anyone, so thats why i think we need to get these reforms in so we have that resources there to meet the promises to our generation and the next generation, but also bring in a new system where again like healthcare, liability into an asset because when kids get their first parttime job and keenly this money, that money is invested. When you deposit with the bank or index fund or whatever you do with it it gets invested and macros the economy. Host emailed to you, mr. Forbes flat tax is meant to make the rich get richer, just like when reagan reduced the top rate from 72 by 40 . A gift to the millionaires of a 300,000 reduction on tax on each successive 1 million in income. You are looking at things through the eyes of the wealthy. Guest im looking through someone like most americans who want to see this economy grow again, so people who start with the least have a chance to get more as lincoln put it improve their lot in life. Right now you have a stagnant economy. Who gets hurt the most cracks incomes are not rising for low income people. They are not rising for middle income earners and we dont have the upward mobility have had in the past, which is why we have political frustration today. So, a flat tax and thats why its worked around the world it enables an economy to focus our resources and our brainpower on productive things instead of idiotic tax code. So, in terms of growing incomes by the way, john kennedy, we host talk about Ronald Reagan, john kennedy reduced income tax rates across the board about 23, 25 including the top and so you could accuse him of favoring the rich, but what kennedy tax cuts when they were finally enacted with johnson led to the booming 1960s. Reagins led to the booming 1980s. We created millions and millions of new jobs including a more and more high paid jobs instead of these parttime jobs. You are counted as employed, but you are not getting nearly what you think youre worth, so we went to get the dynamism of a growing economy and the flax flat tax is one great way to do and as for tax lawyers and irs agents, even though im a conservative i would support job retraining or perhaps urge them to work f u do something useful. [laughter] host becky kurtz, a tweet from becky who is the smartest person you know in and in or out of governments and whats the best run us city and state in your view . Guest the best run city and state. In terms of smart people, one of the things is there is a lot of smart people and the key is its not enough to have the smarts. You also have judgment and a willingness to learn. And a lot of people who have iqs that could boil water, but who cannot seem to translate it into doing something that. So, yes, and a lot of brain power, but they come to some conclusions that i just disagree with, so thats the nature of life. Its not enough brainpower. You have to have a lot of other characteristics and by the way, people can also focus on a particular area and do very well even if someone would say, well, they are not boiling water with their iq. Thats not the key thing. In the early days and i think google is getting back to it, in terms of computer programming, that takes brainpower, but they dont care if you know how if you are really good at it. If you are a kid and you get into this they dont care if you finish high school or college, if you can do the job they want you. Some of these jobs do, 10000 month, 10000 month. 100,000 signing bonus. 100,000 stock options, so its not the degree, its how you apply what you have that i think we will see more and more of in this economy. In terms of the dynamism of the economy, thats how we get a head. Again, you get entrepreneur and people doing things they comes from the most unlikely areas where its middle aged milkshake machine salesman who invented modern restaurant injures three or henry ford who ran a Grocery Store and helped create one of the biggest enterprises in the world. Its Amazing Stories that can unfold. Host to take beckys city state question, do you have anything that comes to mind . Guest well, i mention he was former governor of indiana, mixed daniels who demonstrated indiana over relentless work, not just one day, but relentless day to day work. You can do what government should do, do it more efficiently, reduce taxes and turn a state that should have been a basket case into one of the best Credit Ratings in the country. On the opposite side, you take the word grease and translate it into english and you get illinois. One of the worst rated credit stay in the country. Chicago is about to go broke. The stay, they have a great governor, but the Legislature Just is in lala land we dont have to worry about revenues, so its a disaster and so i think Mitch Daniels is an example of what can be done with good leadership in illinois. What happens with over time in a series of bad decisions made. By golly they come to bite and i will give a good word to even though people dont seem to like him anymore, scott walker in wisconsin. Those reforms are starting to kick in. He took a lot of grief for it. I dont know why that campaign was so disastrously wrong, but in illinois i mean, wisconsin he did real things. Wisconsin has always been a laboratory. Progressive era, whether it was welfare reform or Tommy Thompson in the 80s became the basis for clintons welfare reform in the mid 90s and what walker has done, so thats what federalism is supposed to be about. See what works and then maybe do it nationally. Host just a few minutes left. Bobby, tanto, south carolina. Caller firsttime caller, so im kind of nervous. Im 50. When i was 45, my family has a history of Heart Disease and i played golf the week before, through batting practice to 16, nine, 10 years old, that friday had a heart attack when as 45. Host i apologize, body, but we are running out of time. If you could get to your question for mr. Forbes. Caller i will write him. Host thank you for calling in. Ron in new hampshire. Caller thank you for taking my call. Steve, want to ask you about the tax implemented with value 19 amendment. Its a flat tax, but has no exemptions or deductions, so a revenue neutral flat tax with those conditions is about a half a percent in the tax is everything and the advantages are it gets rid of the distortions of our Current System that under taxes the intermediate sales and it would have side effects like discouraging highfrequency stock trading and making longterm investments more tax efficient and the poor would only pay half a percent on their income, so i was wondering what you thought about that tax. Guest anything that is low is music to my ears, so if you want to send me more details on that and we do have to get rid of the 16th amendment of the constitution or do something where the tendency is when you bring in a new tax it stays on the other taxes stay and very very hard to get them down once they are implanted. So, yeah, lets me know what the ideas when you say tax everything, that encompasses a lot of things that i want to be sure i know what exactly we are getting into. Thank you. Host nebo, cleveland, ohio. Hello. Caller i would like to ask whether you have any opinion about philanthropy, Warren Buffett and bill gates say a lot and i have been listening so far and i have not heard mr. Forbes say anything about this. Does he have on opinion about the way wealthy people distribute or pass on their funds to other people or other groups, other nations . Host what do you think, neville . What do you think that views should be . Caller my opinion is that Warren Buffett and bill gates are setting a fine example. Host thank you, sir. Guest one of the Amazing Things about the United States is that we are the most philanthropic nation in the world. Over 300 billion a year given that does not count the hundreds of millions of hours people contribute in terms of volunteer time and that has been true almost from our very existence and we are also the most commercial nation ever invented and people think they are opposite poles of air not. Commerce is about meeting the needs and wants of other people, and there are many examples and you mentioned gates and buffett of people who have done very well in the private sector are also very effective in philanthropy. What gates is doing in terms of fighting malaria and other diseases, berry berry acai or a. What hes tried to do an education and i think Warren Buffett made a very good point. We do a conference each year and one of the points that buffett likes to make is in terms if you are an entrepreneur and went involved in florida to be, dont go for the things that have already been done, what he calls the routes of the easy things could go for something of a high risk of failure. Go out onto the front here and try to make things happen. You may not work for a while, but just like a new business, most dont 16 succeed, but go on the frontier and go out of your comfort zone to make things happen that others have not done yet. So, in terms of the reforms, one of the things we point out in the book on the tax side is that when the American People have more they get more. They dont need to be bribed by the tax code even before we had an income tax, we were very philosophic nation and in the 1980s, just one story, 1980s a lot of philanthropy stop when reagan cut the top rate from 70 and an excellent anti 20 that it would hurt tradable giving because uncle sam in effect would not subsidize 70 of the dollar given, but only 20 cents of each dollar given. What happened was the opposite. People not only gave more, but the rates of growth went up as well, so when people have more they give more and this Country Research shows that roughly the American People in cash gifts give about 2 equivalent of 2 gpa year, so thats roughly 350 billion. In good times it may go up a little bit to 2. 2 and in rough times and make a database, 1. 8, but its fairly fairly constant, so the bigger the economy the more people give. The more people have the more they get. Host Steve A Forbes we try to do this program back in april. Whats happened . Guest we had a train accident. I was coming down on the amtrak outside of philadelphia and suddenly the train came to on a abrupt halts, not the kind of thing normally slowing down around a curve or anything. Fortunately, we were in the last car, back of the train and so we were jolted and our coffee flew and things flew, but thankfully we did not. In the front of the train there were real injuries and sally to workers, how it came you have people working on a truck with a train coming on in this day and age especially, those two workers were killed. So, we were in the back of car. We stopped. Nothing was said. I wish they would have an intercom system for emergencies where they could say, stay calm. We did not go out of the train because there was a truck on one side and a track on the other side and we were not going to risk back, so about a halfhour later there were rumors with people coming back and forth and before the First Responders came and said there was an accident, dont move. Will take you into good off and in about 15 or 20 minutes later we went off and walked carefully down the steps, went across the tracks, went across the field and thankfully there was a church that had an adjacent gymnasium and we could go in there and waited to see what was going to happen and the Amtrak Police have the manifest so they knew who was on and i checked it to make sure no one was missing and you just dont know in these situations, so we waited and buses came. Arranged kindly for a car for me to get me back home since i was not going to get back here on time, but they still have not come up with a definitive report on what happened on that, but thankfully i was not in the front cars because the injuries would have been very serious instead of just losing your coffee and getting a jolt. Host uk down on the train today . Guest train today, uneventful. Host uneventful. Good