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history at west point is written in study after getting the courage at the enterprise institute. they would get the study into the white house directly to president bush, to the pentagon to the secretary of defense to some of the support and it's an eyebrow so that basically by the time petraeus becomes the top commander, everything is all lined up. it's lined up so that he can go in and impose the strategy that he wants to impose in the united states government this isn't a coincidence. it's been very exquisitely coordinated. >> you can watch this and other programs online at book tv. >> up next on book tv, samuel argues if our elected leaders do not find the courage to reform the economy and government spending soon, the u.s. could find itself in the same terrible economic situation as many european countries do today. this is just over an hour. >> coming to speak at the heritage foundation today it is a great privilege to be here. i've always been a great admirer of heritage and the council in many cases the friendship of many people at heritage for a long time. i admire your the way that heritage works across the policy areas so that you really do here and the integrated message not least among which i think is the attention of the heritage foundation to the power of culture by which i mean the believes, ideas, habits, expectations and the ways that these achieve some form of institutional what the exception this issue of the culture and how it relates to the economy is at the heart of my book because at one level becoming europe is what has happened to europe and why it is now regarded as the sick man of the global economy. but the book is also about how some of these cultural and economic trends are starting to manifest themselves in the united states particularly in the past five years. in some respects it is rather ironic that america is seemly drifting in this direction of economic european and asian because there is the colossal level of debt, the increasingly unaffordable warfare states, struggling banking systems come soaring levels of unemployment, stagnation or lubber economic growth, double even triple dip recession is, violence and riots etc. i think what europe is experiencing now is no ordinary recession. instead i think there is the sense that western europe's present economic crisis reflect deeper because of external pressures but rather because of some of the inherent contradictions and dysfunctional the that's encouraged by what i call european economic culture over long period of time. all of that is to say that if america's economic culture as i call it continues to drift in the same direction i think we can assume safely that over time some trends we see in europe start to manifest themselves in the united states and that i think is what americans mean when they use phrases like the european are becoming like europe. the first one to do is explain what my book means by the free is becoming europe. the second thing i want to do is sketched out where some similar trends are manifesting themselves in the united states and some time at the heritage foundation and the spirits i want to suggest how america might be able to avoid going down the same path. to start explaining what i mean by the european economic culture is david cameron's recent speech about the future in the european union. this is about many things but the speech also represented yet another missed opportunity by major politicians to address unequivocably more fundamentally dangerous for britain and much of the rest of europe than turning the superstate tendencies have these are given institutional expressions in the economy because as in europe the prevailing convictions across most of europe is that the state is the primary way in which we address common problems and meet our response a devotees and obligations to our fellow citizens that such obligations might be realized outside of the realm of politics doesn't occur to large numbers of the european political leaders i would have to say of a considerable number of european politicians. in this regard i often wondered why it would be an important book that was written 180 years ago by one of his compatriots. because to go about the new world, democracy in america wasn't written for an american audience. the top bills intended audience was europe. so i expect it would be astonished to learn how they don't need problems would be beyond individual capacity to address but also resolved by things like trade. 19th century americans addressed these problems in the habit of the freeze association instead of simply accepting the government officials to lead into the breach. the contrast with native france was astounding. whoever at the head of some undertaking in the united states you will be sure to find a free association. as adam smith noted there are some things that can only be done by the government but the constant equivalents of the value of what many call solidarity the constant equivalents of solidarity with the government programs and public sector agencies is surely one of europe's biggest long-term headaches if only because such expectations and the part of the state just defied the regulatory welfare states constant even endless expansion despite the fiscally and a terrible burden by which could now be obvious to the lowest committed. unfortunately, it's not just the upper class is to think this way. millions of ordinary europeans share this mind set. take for the civil mr. cameron's backyard. scotland is currently dominated by the two political parties who are more socially democratic. but labor and the scottish nationalists don't control the scottish politics simply because they are rather in that. the order after all elected to parliament by people who apparently want social democratic policies regardless of the long-term economic cost. now, five years ago the former white house chief of staff famously reminded us you never want a serious crisis to go to waste come end of quote. but this is a bias i think that europe's leaders have declined to take because very few of them seem interested in using the country's severe economic challenges as a type of a circuit breaker to articulate a grand vision of why the economy and the society needs to be liberated from all the mighty governments. instead, what you find is most european politicians when you are presenting things like austerity measures they are necessary evils embarked upon with considerable reluctance so that we can get back to the way things used to be. one reason for this is that many of europe's politicians know appeals to greater economic liberty and smaller government simply don't resonate with enough western europeans. in recent decades the nobel economists such as douglas north and that meant had illustrated the significance of the point made that while deval and policies matter they tend over time to reflect what the majority of people in a democracy value for better or for worse. like many other people, he concluded a long time ago that contemporary european economies are generally less productive than america because of institutional factors, things like large welfare states, market regulation, large safety deer receipts, etc., etc.. but he said this can't explain everything. european countries, to use his phrase or not a bunch of republics nor was it clear they lagged behind the united states when it came to the growth such as the existence of the ruble fall so his intuition is that the differences had to come down to america's economy being influenced by the culture which valued things like freedom and risk-taking so he decided to drill down into some of the data that surveyed american and european attitudes and what he found his on it can to things like change, competition and the notions of freedom more generally come he found that americans were much more favorably inclined towards these things than most europeans. he came away with differences across countries witith differes across countries with respect to certain well-defined institutions were not as important as prevailing distances and economic culture. he even speculated economic cultures can become so entrenched those people who live within them who their minds become closed to any other type of alternative for possibility. this brings me to the second part of my remarks today which is how the european attitudes are starting to gain ground in america. study after study after study has shown in my book shows a shift among americans away from favorable views of the free enterprise and markets towards what you might call more social democratic positions. to give you an example, in 2011, won international firm, a very respected firm released the results of surveys into different countries' attitudes towards the market economy so in response to the statement the free market is the best economic system in the world call only 19% of those in britain agree on that statement. the numbers were higher, 24%, emily 21% and lower in france which was 6%. germans expressed the highest degree of approval about 40%. but the shock i think came in the americans reactions. in 2000 to 80% of americans surveyed expressed a favorable view of the free enterprise and free markets so that's 2002. eight years later the figure had fallen to 59% a and among lower-income americans the trend was even worse. 79% of those surveyed expressed favorable views of business commerce and the free market. by 2010 the figure had fallen to 44%, and among young americans, the trend is even more marked. now there is no doubt that these apparent shift in the american and caribbean opinion on a great deal in the 2008 financial crisis. but as i remind the readers, they're has always been, since the progress of this era a strong strain of skepticism about free enterprise and market among america's political and intellectual elite. .. many western european nations have long failed to mass care, for which i think america also seems to be struggling with. and the crisis flows from a very unhealthy nexus between democracy on the one hand and the fact that we now live in a culture in which many people simply assume as a matter of right that they are entitled to certain things from the government without too many questions being asked about how to pay for it. this combination i think is presently proving toxic for much of europe, but i think it increasingly comes to the danger of america's economic future. now obviously, there's an economic dimension to this, a purely economic dimension. when governments constantly spend more than they reeser taxation, borrowing money is how governments have made up the difference. in many european countries, the subsequent debt burden has now got to the point where by its effect in governments ability to meet their financial obligations. in spain, for example, things are so bad regional governments are trying to defer payments for certain services to private businesses. before americans starts coughing, we should consider is the fourth of february 2013, america's official public debt was and it seemed $16.44820. not the real figure is probably much higher once we include things like unfunded future liabilities such as social security and the existing obligations of all the bankrupt states like california and illinois. but i think jan to economics, there's also a more subtle cultural force in here western europe serves as exhibita. many of us know the contemporary modern warfare states origins go back to need teamed century germany. some of the biggest expansions of the welfare state in europe occurred after 1945. given europe's yearning for economic security after two devastating world wars and the great depression, the yearning for security through the state on the part of western europeans should not surprise us. but what i think was surprising and i talk about this at length in the book is how quickly european publications recognize the state's ability to provide social programs and subsidies was a way to build reliable voting constituencies. governments are not just for laughs, but also the right relays they could attract support by making promises regarding things that pension or retirement age, subsidies, regulation and government jobs. sound familiar? this is paid for us to know in europe increased taxation and when that didn't cover the cost, debt became the means by which the short form is covered. one justification for democracy is that it provides us with ways of holding government accountable when the decisions don't accord with their wishes. we have to ask ourselves, what happens when some citizens began viewing these democratic mechanisms as a means for encouraging elected officials to use the state to provide the citizens with whatever they want such as perpetual economic security. and what happens when elected officials start to believe it's their responsibility to provide demanded security or more cynically, start regarding welfare programs, for example, as a useful tool to create constituencies that can be relied upon to vote for. the end result shouldn't surprise us. it's this spiral of expanding that, welfare, regulation that politicians at the expanding welfare beneficiaries have any desire to stop insulting skits about that there's no alternative. but there's a political problem because unfortunately in democracies in which many people see the state as the primary provider of economic security, meaningful restraint of government intervention and spend name is very politically difficult. why? is anyone who promises to try and reduce the scope of intervention in real terms is in many respects at a severe electoral disadvantage. at luxembourg's prime minister jean-claude junker famously lamented in 2007, quote, we all know what we have to do, but we don't know how to get reelected once we have done it, end quote. in other words, if enough people in a democracy what security through the state regardless of cost, capacity politicians to oppose desires of 51% of the population is very limited. because to resist is to court electoral rejection rsp stain, rioters running amok in the streets about this. it's very tempting to see all this is a western european problem. this is a continent in which many nominally governments default economic positions are essentially socially democratic. another rates, extensive government intervention is simply seen as normal in most of western europe. but can anyone seriously deny many american politicians, including some conservatives also play this game? or that millions of americans have developed rather inflated expert haitians of what government owes them an economic terms. and i'm not just talking about those who apparently regard to streamline if social security is an apparent human rights violation. i'm also referring to american businesses to prefer to pursue corporate welfare instead of competing in the marketplace. so having thoroughly depressed you, let me move on to the third and final part of my remarks. how can america break this nexus? clearly it is essential to have and make long overdue politically difficult positions about government spending that america's fiscal cliff non-climbers recently managed to avoid making. adding more elemental level, showing what we need is significant attitudinal change. somehow governments some legislators, for example, have to start doing public finances is a vote attracting tool. my suspicion is they're not going to do that unless they send to things. the first is that the american people do not want to head down the path of economic europeanization in general. enough americans are willing to embrace what that actually means that the loveless specifics. as my book illustrates, even self describes limited government americans when it comes to reducing subsidies and regulations are specifically benefit their business or their industry or their town or their state. so in that sense, the bigger challenge is to ask ordinary americans. to put it bluntly, we need to accept that our participation in democracy cannot degenerate into voting for whoever promises to give us the most staff. in short, if we are unwilling to use their democratic freedoms responsibly, america is seriously risks becoming what one german academic described in 2009 as the situation prevailing that much of western europe. he taught at fiscal cliff top receipt. but he meant a citizen so for those politicians who use state power to give supporters that they want at other peoples expense. fiscally, that translates into tax increases. substantial spending has come a welfare state, will close the corporate welfare and the colossal debt burden for children. welcome to greece. but also welcome to the state of california and illinois. it's interesting and long term term if you look at history as america's founding understood these challenges went beyond pure economics. thomas jefferson was no model of personal financial rectitude. but he understood the threat posed for things like excessive public debt. to preserve our liberty, we must not let our rulers load us with perpetual debt. they must make economy and liberty and servitude today our federal government seems unable and done cases unwilling to choose economy and liberty. but perhaps more serious question facing the public is whether or not american citizens are willing to choose nonsearch did or whether they are continued drifting towards the failed project a device known as the european social model for european social democracy. at present i am afraid i think the jury seems to be out on that one. so i'd like to conclude, how does america avoid this path of europeanization. on one level it is a question of incentives. i am not a philosophical materialist. i do believe there such a thing as free will. but it's also true if incentives are aligned in nature action is harder to persuade people not to follow. the more that america does any more or less covertly democratic direction, the harder it is going to beat to persuade americans this is not economically or morally tenable. that in many respects point to the importance of policy. policies embody incentives to be creative, to be competitive and to not demand because such things to longer be available. that said, policy is very important. but policy is not enough. those who want america to become more like western europe are you an idea much better. those americans want this are much better at doing what some people call efficiency. they are better at expiring people to opt for certain policies do matter how demonstrably gives or destructive such policies turn out to be. why many conservatives and free marketers are very good at policy. some of us find it very, very difficult to move beyond efficiency arguments to articulate a vision for america that can rival if not outplay the less constant appeal to a thoroughly corrupt conception of social justice, and appeal that's extremely powerful in western europe, but is plainly made considerable inroads into important sanctions of american public opinion. because there are such things as known economic incentives, we often think of incentives primarily in terms of financial reward, but incentives can also be nonfinancial. the desire to do good and to be seen as a good person can sometimes incentivize someone to act one way rather than another even if objectively speaking is the wrong moral choice. so what does this mean? it means it's been seen as a good person by your peers is associated with large welfare state, some people will vote for lurch welfare states than that welfare programs despite the fact that economically speaking it may not be in their best interest. likewise that the path to social ostracism lies in arguing people should be held to take care of themselves, the incentives to be a prominent advocate of limiting government power are much, much lower. if what i've said is true, it should radically the way in which we seek to stem and maybe reverse economic europeanization in america. certainly changing policies come in changing the rules of the game is important if we're going to alter incentives. but if douglass north cautions, both institutions and belief systems must change for successful reform simply said it is the mental actors that will shape traces. his convictions are so strong that he says attitudes and values and expectations that are favorable that to grow economic creativity coverdale in some respects overcome institutional restraints upon such things. but it does indeed come back to values, beliefs, attitudes and expectations, we need to do more than just shift economic incentives. it is a question of showing how the moral case for a free economy is far far beyond the logic of supply and demand. in "becoming europe"'s final chapter he try to sketch out an agenda matt buckley and its escort to economic culture as they think they are, americans need to be clear about value choices they must make if they want to wait economic europeanization. if you choose, for example, to prioritize the good of wealth creation of her well-to-do redistribution. they have to prioritize accountability. they have to prioritize rule of law over the rule of men. they have to prioritize things that property rights over the top down direction of the economy. they have to prioritize hope i may have to give priority to openness rather than defensiveness. so creation, little flock, property rights, openness and focus. in "becoming europe" i explain what these mean and how they affect institutional posts and policies. these are characteristics highlighted by alexis de tocqueville that he visited in the 1830s. de tocqueville also noticed something else as perhaps his most discerning biographer, andre van damme knows, quote, one of the first surprises in new york was a gathering one would read shoulders who man who has spent the day in an office or a bank, lawyers, business, bankers. pleasures of society came at the end of the day in which they had reached acs battle for profit, and quote. such a state of affairs shocked toqueville. why? because what he made up front was dominated by men who helped government office or her scholarly gentleman of measure. captains of industry, aspiring entrepreneurs are largely absent from these gatherings. that tells us something about the disdain with which much of 1830s europe regarded commoners in business, but also reveal something about america that he was not as materialistic as many americans supposed -- as many europeans oppose in which many continue to assume. the pursuit of prosperity was not all-consuming of americans live despite the fact that commercial republic was very much that i'm a commercial republic. achieving economic success gave americans the time and resources, material resources to pursue other less material goods. pursuit of knowledge, children's education, philanthropy, charity, appreciation of beauty and prayer and contemplation of the ultimate realities. this is a vision somewhat at odds with the rough and ready frontier imagery we often associate with 19th century america. nonetheless it's very consistent with the lives and aspirations as many of america's founders and the richest and most economically found her at the mall, charles carroll of carrollton exemplifies this. as many of you know, charles carroll inherited great wealth, but as a successful businessman in his own right, he multiplied his holdings several times over. on his journey straight america, carol was taking notes about things like what crux may be suitable for particular areas. he invested heavily in private economic projects designed to promote public works. yet none of these centuries and the time and energy they undoubtedly ensued cultivated litter the other scholarly interest, nor did they inhabit the long-term involvement in public affairs whether as a representative, political commentator, america's emerging constitutional framework and of course as a fighter for religious liberty. signing the declaration of independence, charles carroll put far, far more at risk economically speaking than any other of the sciences. he was natural to richest man in america at the time. but carroll's willingness to risk all this stuff for freedom demonstrated something else. carroll's convictions of more or more was at stake in britain's dispute with britain than just text as in some things are in fact more important than money. i think this all points to something. it is the need for conservatives and free marketers to embrace the argument persists europeanization to embrace the argument that the endgame of america's free enterprise system is not the endless acquisition of wealth. wealth is a means of human flourishing. this is an idea deeply integral to the american founding and the aspirations of the phrase life, liberty and pursuit of happiness. no doubt part of the happiness is found in pursuit of the current economic interests of like thomas jefferson by benjamin franklin or charles carroll, but other happiness can occur through the very pursuit of domains country and names. in the moral and practical habits that are so crucial in business, trade and market economies are generally. in much of western europe if not most of western europe, a contrary attitude has long been characteristic. if people are to live fulfilling lives, as far as consistent with maintaining minimal incentives of wealth creation, the attitude is people are provided and protected with risk. institutionally that translates squarely into the model. that's interesting is there is very little evidence that such policies actually help make people happy. as i illustrate in "becoming europe," many people on long-term health care are generally less happy than those who are in the same income, but don't do it through author payment, instead do it through work in a job. there's been lots of studies in both america and europe to talk about these in the book. we have to be careful not to read to much in the studies because correlation is not causality. they do suggest they are focused upon endless redistribution from the top down in an effort to realize ever greater equality and ever greater stability are much less successful at helping people to flourish as they had to flourish. benjamin franklin never made a man happy, nor will it, and quote. but how one achieves both, how one gains and calm certainly does seem to matter when they think about something profoundly un- materialistic casino floor shaking. picture this economic culture is more or less informal to values associated with progressive economic equalization said to have rather take him in person spirit collective assistance or extreme example of this. the american founders were better when they knew when they associated the word liberty with the first pursuit of happiness. it is in the exercise of freedom, including economic freedom, where much of the happiness making seems to occur. another is a trade-off because the downside might be less economic security. but while 70 canonic security is important, if not all important and it's certainly not enough for human happiness and flourishing. this underscores the truth that if americans want to be faced europeanization, they have to do more than engage in policy because the fight to take back america's economy from those who try to release a social democratic dream/nightmare not over the past six years, but i would argue the past 100 years has to be more than an argument about the relative efficiency of markets versus mixed economies. man does not live by efficiency alone. quite this much by the maximizing utility. no one is going to go to the barricades for effectiveness and efficiency. as a society then, america has to consciously choose not to cut off its economic culture of the reason which is calm. as i demonstrated in the book, those are certainly appeared in america have been refined and deepened over 230 years are distinctly american experiences so much so that not even politician as savvy as franklin roosevelt or lyndon johnson were able to pull them out completely. unfortunately, there is no guarantees the service will persist in america. economic cultures are like plants. must you tear them from their bruised, they tend to die very quickly. creating values that promote market economic cultures, let alone institutions that enhance and protect them as extremely difficult but failures to do so. americans can however cultivate is the founder said as a sacred trust, the heretic which is grounded deeply in what we should unashamedly call european civilization. if americans choose to do so and choose a month, americans can have confidence that whatever happens to europe, if we make the right decisions at the level of attitude and belief and expectation, whatever happens to europe, something of western civilization will not just be saved. i think we'll also have been transformed and new. thank you very much. [applause] >> will be glad to take a few questions. we do have copies of the book will be signing afterwards if you'd like to talk further. we have a microphone i ask you to wait for my well-recognized people in the audience, but i'm going to start with one. your quote from jefferson we discussed the perpetual dance to or three sentences prior since i am not among those who fear the people. ironically, are you telling us we might be a time of fear in the people? >> might be in a time of steering some people. jefferson of course had tremendous faith and the americans at this time that they would do the right thing. a cyclist and churches in america will do the right thing after they've tried everything else. but i do think given some of the attitudinal shifts i talk about at length in the book about how americans view for free enterprise and free markets are not as favorable as they used to be is particularly disturbing when it comes to young people just how much they more or less seem to prefer social democratic ideas and models and institutions compared to what america's history has been. those in favor of free markets and enterprise are not doing a good job explaining to young people who generally are optimistic, tend to be people who want to be inspired. they tend to want to have an ideal to follow. if they are opting for a marvelous social democratic europeanization model, that will create enormous long-term problems in the united states and a sense that it would tend to reflect what people want and if the people want social democracy, gossip or going get? social democracy. >> thank you for your very good understanding. the 19th century influence as well as the influence of the great traditions, do you think there is an educational program out there? i went to hillsdale college and we are very big on this issue, but would you point to other positive educational force this? >> sure. let me say something about the negative side. i think it was marx time was that conservatives need to understand the three weeks of robocalls before an election is no substitute for eight to 10 years of marvelous indoctrination and educational systems about why free trade is bad, markets dehumanizing, et cetera. you're not going to persuade people with robocalls after they've heard this stuff year after year after year. when i picked up a newspaper, they see the same message. they pick up a television comedy see the same message. they are being reinforced and over again. a good person if your favorite favorite -- so winning the cultural pride is a long-term prospect in the left are much much better than we are doing that. that said, there's many programs out there for young americans who are maybe not persuaded yet the merits of free enterprise and free markets on economic grounds, but there's lots of programs out there. poster, for example, does a good job in explaining to people where these things come from by going back and reading great books in explaining to people, this is our heritage and this is why it is important in these people won't just make a economic arguments. they honestly thought this was important. there are places that princeton that do these things. i think they're doing a good job of trying to perceive the founding that makes these ideas about human flourishing real unemployment to different segments of social life, foreign policy, economic policy, the area. many universities are also doing this type of work and as you probably know places in washington d.c. to spend a lot of time doing this. so there are places to go. there's lots of programs for students interested in these things and of course they are very much in tune to it is established in the academy today. so there are plenty of opportunities for these things there's great resource that many of these things are more available and what they are, how you apply and get into them and helping people when they go out but they start to work and apply these things to the very concrete institutional programs. [inaudible] >> i am curious about one thing. germany was ceo origin of social welfare. do you have any insight as to how they manage to do that other european countries are falling behind quick >> i talk about and not a comment that germany is the outline because the modern welfare state as we know it originated with bismarck, the great uncle of freedom. he noticed urban industrial workers were voting for the social democratic and he thought how do we do with this? well, we showed that we can take care. it was at seven noble idea. it was kind of a short circuit this growing support of large numbers of people for the german social democrats who done at that time were more or less marxist political party. but there's also been a long string of market oriented team thinking in germany that's been around for a very long time. perhaps the biggest changes made occurred in 1948 when people live who live who pick up her heart was in charge the economy and the allied occupation can be good by people who are passionate free markets. he simply impose a modern system and simply got rid of currency controls. he got rid of price can trolls in here let the market system work that resulted in germany with 20, 30 years of economic parity. at the 1970s and 80s, it was clear germany had moved much marbach and the type of marvelous social democratic direction and this was made stagnant. the german government at the time were from a social democratic government, decided he couldn't keep going this way, so they embarked upon an eight-year program of selective liberalization of much of the economy and it's paid off. the political price was the social democrats got turned out of office, which goes to prove the point if you want to embark upon serious economic reform in most european countries, you should more or less expect you can be thrown out of office. it's not a great incentive. my point about germany is in or uneconomic history, they have a certain tradition that they can fall back into a way that other european countries evidently struggled to do so because at least it's within the living memory of some german somewhat things used to be like. there's a reason why germans in general don't like inflation and why they are very nervous about relation compared to france and other european countries. a solid inflation into germany and not to suffer political consequences. so that institutional and cultural memory helps to explain why germany has more or less managed to resist these other trends other trends of economic europeanization, but it's precisely because there are some attitudes and beliefs and values of life in germany and enable germans to go back in my come of this is part of our tradition. this is not an american team. this is part of who we are as germans did its a good example about economical to really matters. >> i am german myself and it's nice to be here. i have a great idea of how you can, when you want to say a matter of communicating to avoid european paychecks would be a nice wake-up call for everybody. at the moment, is not quite a critical time because people unemployed right now politics implemented right now can create things, like how high the risk crisis in 2008 leads to something that persists for longer time it shapes the economic landscape of this country that we might want. >> right, and i think 7.9% of the official rate at the moment. we know the real rate is higher. wilson of millions of americans are looking for work. so this yearning for security that follows from widespread unemployment tends to mean politicians, institutions react in certain ways by trying to provide security to the state. once you set up a program, the heritage they want to set up these programs come and they tend to acquire a life of their own. they're difficult to dismantle because of public choice scholars tell us they develop their own interests and agendas, which have nothing to do with the people they're trying to help. but we do know is once these institutions and programs in place, politically got harder and harder over time to not just dismantle, but even question. a very good example is the national health service in britain. i lived in britain for a long time. i can tell you from personal experience national health service just after the second world war is terrible. any object or standard of quality of health care come the speed of delivery, it is terrible. if you talk to enough people living in britain, they will freely say to you, the service because of god. if we want that we fight to germany or the 90s dates. but if you ask are just people, so do you think we should move toward freeing of health care? you think we should move towards some sort of liberalization, to letting the market forces work? now, he simply cannot do that. our number one very nice lady, very idealistic young girl sang the national health service is part of the jewel of one of britain's power. he said that it's bankrupt and it doesn't work. her reaction was what is important as we care enough or willing to accept all these things to help people. signature not helping people. it is an example of how a program or institution become so embedded in economic culture that rooting it out is almost impossible. you can't give british conservative politician to criticize. we just need to tinker here and reform on the edges. it doesn't work, but it fundamentally doesn't work, not to know should be doing. we need to get rid of it or move to something else. that's a very quick way of courting electoral rejection. my point is once these things in place, they can stay around for a long time no matter how dysfunctional they are. >> the merit-based family rate are all geek or that they were a year ago. it seemed to be stronger in america, but still weak. what impact of those three fact does have? once you eliminate the two leading institutions of civil society, although it's a is the individual in state. >> i talk a lot about both of those issues. most of the population issues, but i do good to marriage issues in every single european country except ireland is below replacement level grade. mediterranean countries are a disaster. decreases of 1.3. replacement rate 2.1. the only country that is replacement rate is ireland at 2.1. francis klose, britain is not too far away, but ireland is the only one replacing its population. why is that? well, it's obviously got to do with things like falling mortality rates, which means people are living longer. it's also got to do with babies are born intent to survive end up as quickly, so people are not having children. obviously the availability of contraception has all contributed to its going on. the welfare state was minimalistic. i don't want to sound like an economic materialist, but i'm going to. once the welfare state comes and come it takes away intergenerational bonds that get replaced by the state. so people would often have an economic motive for having more children because it would mean there'd be some children around would be able to take care of in their old age. it is called the old-age motive for fertility. i talk about how this is very important. the welfare state breaks those links. the pay-as-you-go welfare systems reflect my responsibility to the previous generation. what they do is create a huge rent seeking problem and that people say they may not articulate to say, but their reasoning yet on a tour of children because i'll be taking care of by the welfare state. i'm in someone else's children are basically paying for you as well as their own children. this creates incentives for non-fertility. it's a very materialistic explanation of the issue is much more contemplated and has to do with other factors i mentioned. but it is a real factor and they should be like to talk about that. if it had been infected in the united states clicks yes. california is a classic example. california is zero. it really is in every measurable institution factor, but also in terms of attitude and belief and expectation. they've made their choice and it's not a coincidence. the population level their shrinking. it's not just people leaving the state. it's zero so people having fewer and fewer children. a good example of how states can come in and crowd out other institution cities to take care of these long-term social and economic challenges, but produced far worse result for people they are extensively trained to help. >> thank you, dr. gregg. [inaudible] [inaudible] -- long-term effects will be. >> i talk about this at length in the book because there's obviously economic cost to social democracy. less per tutti, increased regulation, which makes it harder for people to get jobs, et cetera, et cetera. one is decrease in people's sense of responsibility for themselves and for their families because the state takes care. that is one manifestation. another is the moral cost of expectations that i'm entitled to certain things as a matter of right. without any real explanation of where these rights come from or why they might be rights at all. the language of moral discourse becomes corroded, breaks down to the point whereby things like race become a trump card to shut down discussion. you can't reform the program because it violates my rights. the type of perverse orality boosters to work its way through moral, philosophical and political discourse. there's also a moral problem is simply expecting other people who don't know have no idea what the obligations and responsibilities are, to basically pay for you and whatever it is you happen to want. the sense that i should be responsible for myself and my family starts to break down in these types of conditions. i also think it leads to a going people as human flourishing in a sense of a network are not just transforming the world, i'm also transforming myself. work instead becomes seen as something i have to do so i can get along with serious vacation of having my vacation. in 2004 -- in 2004 some studies were done a french university students who had gone to places or had studied at places in the leading institutions, which trained france's political business in the future. i have people who are graduating what they want to do with their lives. 70% said they want to be a civil servant. why? big enough to work hard, they got paid pretty well, got great vacations, generous pensions and all of this is to say the cost of a lack of dynamism, a lack of willingness to take risk. life is in many respects about taking risk. if you opt for stability at any price if you ought to be what i call a status quo area, you will flourish as a person. you're going to basically be stagnant as economies around you. that is the human person, nature of the will, but there's not much doubt social democracy is a deadening effect on capacity to become what we are to be. [applause] >> tuten thinks congress doesn't want you to know about how it does business. number four, powerful members of congress can save noncompetitive seats often hold fundraisers outside their district to increase leverage over at the numbers. number five, congress spends more than 100 billion every year of well over 200 programs that are not authorized by law. another six, congress routinely reads the social security trust fund to cover general revenue shortfalls. >> if you look at appropriation bills that have not been done in the last two years ago that the political dynamic going on in you go when you say we are appropriating x amount of money and you look at many programs, it's actually over $350 billion now of programs that are funded that are not authorized by the congress, which tells you there's an imbalance in congress of how we appropriate funds for programs that we haven't said we should be spending money on. and they toasted the power of the appropriation committees and the power of benefit going back to the states of what is most important. is that most important to actually look good in oklahoma or is it more important to think in the long-term, with the help of our country going to be in the long run and how do we make those tough decisions? politically it puts you on the losing side of every argument they can do for that tier. you have to work hard to explain yourself. >> host: number seven, members of congress frequently do not have the opportunity to read the bills they are voting on. number eight, with one of the more secret and anti-democratic ways in which congressman mr. in money in language that only members of the committee can vote on our men. number nine, each year congress spends countless hours of the budget resolution has no intention of keeping in number 10, congress circumvents its own budget limit and avoid scrutiny by exploiting its own arcane budget procedures. those are all true? the budget resolutions are about to begin the season in february. is it a waste of time? gusto now, right now we have a $3.65 trillion spending. the big criticism of the last two years is congress' gridlocked. how do we authorize spending $3.65 trillion? what we are gridlocked into spending money we don't have on things not absolutely necessary. that is what we are gridlocked on. we are gridlocked city could make ourselves look good to her constituents. there is no gridlock when it comes to spending your kids future in washington. we witness spent 3.6 trillion if we had a budget last year. but we did a resolution that passed which means it passes the republican house and democratic senate and the president signed annually by $1.2 trillion we didn't have him which i would contend 600 billion was wasted. literally did no benefit directly for the citizens of this country other than those that took money to administer or develop work about the program. so when they want, you could look and just say every program stand out that's actually effective and efficient in what you see is minimal. members of congress have been overstated and done their job. it's hard to oversight and i'm going to get i do, so therefore let it go. so it goes that. we are now in cr last year $350 billion for the program were appropriated money at have either never been authorized by congress or the authorization has lapsed. so it means the authorizing committees of congress are working because if we are going to appropriate money, why not just have an authorizing a perp reading committee and put them all in one? who totally ignore our own rule. >> host: how much fear is there among members of much feas there among members of congress of constituents of criticism of not being reelected? >> guest: well, i think it runs the gamut, but i think you need to look at maybe a larger perspective is that as a businessman long before i was in position, built a business. i became a physician as an older individual. i was known as grandpa in class and asked for 25 years. my goal was to be a physician. i wasn't at the risk of my populace other than my reputation with my physician and my patience. so if you put it in context, depends on what the goal of a member of the house of representatives or senate areas. it is the goal to fix the problems in the country. to create at least a better future for the next generation of fathers as we've had and it's not always about your personal goal of getting an office that is notoriety power and position, you can do fine because you keep that fear in it. your number one goal is notoriety and the secondary goal which help to get to that goal is to secure the future. what happens is how you value your position on certain policies changes. that is not impure. that's not terrible. that's just human nature. so i make the point in the dead on that if you're ever going to solve this problem, if we are ever going to secure liberty and freedom for kids and grandkids, sending politicians here. >> host: senator coburn, did you get many hostile reaction from your colleagues? >> guest: i did on breach of trust. i don't think many colleagues had read the dead on. i'm sitting here talking to about this and make the speeches in my own caucus and i do that on the floor. i'm okay to take the consternation of criticism of my colleagues if i actually think our country is in trouble, and it is in trouble, we will bankrupt. if you take generally accepted accounting principles, the same thing c-span hot-swap radon, most county governments operate under, we right now have $88 trillion in the have to pay for we have no idea where can i get the money. ed trillion. that's about 1.05 trillion more in bills coming due and what we have over the next 75 years. if you didn't grow the government or the economy and all. why do we put ourselves in opposition? the fact is we are now the federal reserve has increased its balance sheet. in other words, $2 trillion worth of money. they printed $2 trillion worth of money and ultimately the pain of that is going to fall in the middle class in a very poor in this country. and it's going to defeat with both parties say they want. and yet we don't have the courage today to make the tough choices, even if it means we lose hours each to secure the future for this country. we put ourselves first and that of the country first. it is not hard. any american citizen, if they read back in black and other website every day, there is a lot of common sense ways to save money. just this last week, the air force announced, this is a great example. the federal government this year we will spend $64 billion on i.t. projects. that is 60 billion. the gao saws at least half of that will be wasted. in other words, it will never get completed. i will never do what it is supposed to do. we had a program in the first ever said you have to cancel this. he said this two years ago. you want to cancel this because it is never going to work. here is how inefficient government has. this last week we spend another hundred million dollars. they paid a settlement fee to cancel it at $8 million, but two things didn't happen. the person responsible for the contract didn't get fired unless a hot accountable in the company they didn't provide the service didn't get sued to get our money back, the taxpayers of this country. nobody runs their household that way. the state government don't operate that way. but we are totally incompetent when it comes to spending america's tax their money. so why would we continue to raise $32 billion a year on
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