government you're going to be in for an awful long way. john: if they get it may be seen more people will realize there are better ways to give. real charity. that is our show tonight. ♪ >> and now. ♪ john: what is real charity? people are in trouble after a disaster or simply when people are poor. americans instead is to think amount and government help. after all, who will help those people is not government? libertarians argue that private charity would step in. individuals really choosing to help. but with enough of us up? most people say no. that is why liberals like newsday columnist say when it comes to helping the need, that is mostly government's job. >> well, listen, it would be great if people of reach into their hearts and solved all these will problems. that does not happen. in almost every single case where they're is a government program that exists because the private efforts. when you have 04 enough. john: that is because politicians said they were not enough and we could do better. i would argue that a government did not takes a much of our money the private sector would take care of these problems. >> hold on a second. let's get older americans. the poorest sector of our society. something called social security camelot. medicare came along. all the people really do comparatively fairly well. we had hundred kids spread all across america. those numbers were cut dramatically in spite of the generous churches and nice people. >> programs are trillions in debt. unsustainable. >> maybe we have to tweak. but you can't throw away the idea. the reality is we need government then there. john: food stamps, a couple billionaires' could find that all program by themselves. and a private charity would be better as saying who really needs the food help and to is giving the system. >> i would love that. you know a billionaire who wants to pay to my think we would welcome that. john: did not step in because you're a big fat government is there. people say, oh, the government does that. >> here is the reality in real life. all these private efforts are really important. generous people. we give a lot of money. when the chips are really down and the big thing happens, the typhoon hits the philippines, we love the red cross effort. but they don't have an aircraft carrier with marines on board and rescue helicopters. the u.s. military does. i want them steaming toward the philippines when that's-it's. john: i don't know what will happen. in haiti our government promised billions of dollars, billion of it is not done to the people. the new york times said there were going to build 15,000 alums, latest target fewer than 3,000. >> your argument is that government sometimes does not do a perfect job. i concede that. john: i want to play along perversion of the clip earlier. to my left-wing colleagues were talking about how after a disaster faith based charities work better and disaster relief and fema. >> there is fema and then there is the faith based fema. >> if you're waiting for the government you are going to be in for an awful long wait. >> talking about the government response after the tornado in oklahoma in may. now 30 churches banded together to help much more quickly and did a better job in government. this happened with katrina. fema was turning away walmart. people were trying to get water. sending its water to the wrong place. >> you're right. as you know, i am a native of new orleans. there are some things that the province to well. all those kids, wonderful young people who came down, church groups, they did something much better than government. but they were still an awful lot of things that we needed government. remember how angry folks were. no one said stay away. john: walmart and private charities got there. >> maybe one of the things of the privates can do is be more nimble. if you are talking about rebuilding, i don't think you want the government to take a pass. john: i do. let's talk about the war on poverty. lyndon johnson said he would and poverty. here is where the war began. and sure enough it dropped sharply the first five, seven years after that. to then it stopped improving. >> we teach people to be dependent. that was happening before the war. americans were lifting themselves out of poverty. government continue the progress for five years and then stopped it. >> we should have been more generous, done the other things that government can do to help folks. john: government does not teach a dependency. >> i am not here saying government is profit. government has some bad things, clumsy, bureaucratic. there are things it does really well. hey, private folks, step up. john: these graphs of the test. can we put these up. john: the recession, but it goes up steadily. two lines referred to one is the number of people collecting in the other is the cost. we are teaching people to be passive. >> i will grant you that is something we want to avoid. what is the solution from a look at the people and say we will take your food stamps a way? up for the best. >> limit the program some of the private sector stepped in. one more example is the rise of disability test people. straight out. you have fewer people doing manual labor, medicine is better , and more people are disabled. >> i am with you on that one. john: if you want to get rid of it. >> no, i don't want to get rid of it. certainly we can look more closely as of the applications. john: cut it way back. there's a place near college of center, a government office supposedly to help people find jobs. i went there. people said, there are no jobs. we then went around 40 job offers, 28 and to build positions, one restaurant owner said, i would hire a dozen people live there would just apply. >> i would throw we take nine with no experience in trenton. john: and that the welfare of a steeple told us there are no jobs. >> there plenty of jobs. john: government jobs offices to encourage people to take welfare. as somebody go and ask for help to see if it would help her get a job and they said, no, they just to reach for welfare and food stamps. >> again, it is much smarter to have programs that encourage people to work, don't reward laziness,. john: they all do that. >> i don't know. john: private charities and of any suppression did he tell. >> the answer can be to just cut it back a mechanic? john: get it back. and let the private sector in. we will stop there. thank you. atomize a private charity should replace government. what about the rest of the world? people assume global poverty is a problem. it has to be addressed by government giving out foreign aid or maybe the wind. the u.s. and contradicts the title of my book by saying, yes, we, governments, working together can end poverty in just two years. while. two years. of course 50 years ago lyndon johnson claimed his war on poverty would end poverty in america. the u.n. will do better. ted t billion dollars for this. individual governments and squandered nearly a trillion dollars of foreign aid trying to lift people out of poverty in africa. i say squandered because after they spent trillions for income per capita it went down. that is maybe because the foreign aid encourages dependency and african kleptocrats government steal much of the money. what is the alternative? michael fay says he has an answer. what is yours? >> we are going straight to the port. cash transfers from you directly to them. no middleman, no leakage, no hidden costs. john: the charity, and you have raised about $6 million. just given 27,000 people-the thousand dollars each. >> that is exactly right. a thousand for the households. john: this sounds like a stupid idea. they will just spend it and then it won't have any. >> you are not the only one. the truth is there has been about a decade of research that shows the exact opposite. what are these people missing? a lot of them are missing the capital. we have the old expression teach a man to fish. the truth is they don't have fishing poles. john: so you allow them to buy a fishing pole or in this case this may have been a guy who got a motorcycle and use it for a taxi service. >> this is a used motorcycle that he bought with cash and now provides tax to services. john: he gives the people a cell phone with the money. >> that is the way we transfer the money. found the phone. if they don't have a phone them in a deal to get the money. john: and it is easier to check up on them. >> we check, call them, talk to them regularly. john: people build metal roofs. the most popular thing. >> no charity. saves income, clean water, was malaria. we did not think of it, they did. john: before they had that they had at that's true fan is bad about a hundred dollars a year. john: instead they can start a business, another person had received training from another charity to be a welder. >> said he was standing there doing nothing. he did not have welding equipment. john: what makes you think this work? >> we have a decade of evidence, we have done our own third-party valuation. we know income goes up a monstrous level goes down, under follows. john: you do another odd thing. none of your charity board members works full-time for your charity. >> here is the great thing. if it is not working i would not lead to -- need to lie the right attitude my job. john: you could be more honest evaluating it. the charities delude themselves. >> well, i think people have passion and often implies evidence. john: i have hard time accepting i just criticize government pro grams because they don't teach people to take care of themselves. i guess giving cash once and knowing that it will keep coming is different. >> a onetime transforming event it does not matter who does it. matters what they do. why buy a cow when the person is to will then. john: to take care of it? look to make the choice. john: i hope it works. i'm glad a lot of these experiments are going on. thank you. if you would like to keep this conversation going go to facebook or twitter and use that has tank. real charity. that people know what you think. coming up, president obama's says the way to help poor people is to give them a free cell phone. ♪ this is the quicksilver cash back card from capital one. it's not e "fumbling around with rotating categories" card. it's not the etting blindsided by limits" card. it's the no-game-playing, no-earningimit-having, deep-bomb-throwing, give-me-the-ball-and-i'll-take- it-to-the-house, cash back card. this is the quicksilver cash card from capital one. unlimited 1.5% cash back on every purchase, everywhere, every single day. so let me ask you... at's in your wallet? customer erin swenson... ordebut they didn't fit.line customer's not happy, i'm not happy. sales go down, i'm not happy. merch comes back,'m not happy. use ups. they make returns easy. unhappy customer becomes happy customer. then, repeat customer. easy rurns, i'm happy. repeat customers, i'm happy. sales go up, i'm happy. i ordered another pair. i'm happy. (both) i'm happy. i'm happy. happy. happy. happy. happy. happy happy. i love logistics. ♪ >> the government will pay for you to have a free cell phone with monthly minutes, no credit check and no deposit required. john: of free cell phone. 253 minutes. what the deal. this is to help poor people in need a lifeline. that is reasonable. this is a government program that began with ronald reagan. president obama expanded it, of course. and in just four years the costs tripled and will continue rice can. >> a minority. you know. he gave up. , no income, disability. john: the more free stuff you get the more you're eligible to get. but eligible is. what did you do? >> i went to all the welfare offices in manhattan and a couple in brooklyn and found out that there are people of their approach you on the street as the if you have your free phone yet. outside the office. john: private entrepreneur. >> and not on welfare. i told them that. i would like to be buried at think a lot of the people would like to be. but that was enough. they ended up giving me not one, not to, but three free phones. john: the good news is someplace is turned down. >> yeah. they ended up. first of, you are not supposed to have duplicate files which i have already broken and will. there also supposed to check eligibility. they also did not catch the eye and multiple applications and and try to work power to the system again and again. john: and fcc audit, they found 41 percent of the recipients never demonstrated that they were eligible. >> that's about 6 million people. the what you really see is the phone companies have a very perverse incentive to push those bonds and on the street. they get $9.25 per customer per month for this program. the street vendors -- john: is paid for out of your phone bill. if you bothered to read the fine print, there is something called the universal service charge. this was under ronald reagan, make sure everybody and a phone line. universal service. a dollar and two out of every race home built. bison i think that most taxpayers don't know what. i went out and investigated. i didn't know. john: bore people talk to their families. >> the phone companies of the bad guys in this. this is a huge business. the mexican billionaire, one of the richest people in the world. john: he may be the richest. >> csn bill gates compete. but he got in 2011 alone half a billion dollars from this program. so what turned out to be welfare for the poor is actually corporate welfare plan in simple john: and what about my obnoxious question. you don't want to help the poor? >> well, i think maybe there would be justification for a land line. as with a program started out as, but anytime you have perverse incentives for companies to go and no phones combined with the very poor oversight you have to ask yourself, you creating a situation in which fraud and abuse can just compound? that is what we have. john: it should not surprise anyone that government charity is susceptible to fraud. the contractors doing the work. no one's money. the more they give out the more they get to keep. they get a commission on each give away. the cellphone charities, $2 billion. think about the hundreds of billions spent on medicare and medicaid. much more from there. people work out with all this stuff. one man alone spent $20 million on this diamond jewelry, also a fleet of luxury cars, one after the other. all of which she got because government paid millions for medical treatment that never happened. government health is just extra susceptible to abuse. >> and is definitely what i found. was surprised that i was able to get three of them in violation a pretty much every program wall, and if i can do it being someone he tells the truth, just a man from the people. actually willing to abuse the program. john: private companies get ripped off. but they have more of an incentive to check. it's their own money. >> that's right. georgia is actually doing reform within the states to try to see if they can mess with that fundamental flaw in incentive structure. there will start charging $5 for consumers. they have to pay $5 spirit there less likely to god and by. john: thank you. coming up, better ways tell people. ♪ bny mellon combines investment management & investment servicing, giving us uniquensights which help us attract the industry's brightest minds who create powerful strategies for a country's investments which are used to build new schools to build more bright minds. invested in the world. bny mellon. maestro of project management. baron of the bld-out. you need a permit... to be this awesome. and you...rent from national. because only national lets you choose any carar in the aisle.. and go. you can even take a full-size or choabove, and still pay thele.. mid-size price. 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(vo) meee-ow, business pro. meee-ow. go natnal. go like a pro. ♪ john: one of the richest people in the world is warren buffett. is the jeep? he is one of many billionaire sue until recently gave very little to charity. he used his money to try to make more money. he said he would give it away when he died. his fellow billionaire ted turner told me buffett was being cheap. >> she should give some away now john: turner just made a big splash by giving a billion dollars to the wind. now he said he wanted to shame other rich people into giving more. >> what he said is bad and the stupid. john: that was his answer. >> what he should do is take his money and invested. he can help people in the other better way into invested and have the compa in plans that creating the investment creates jobs and wealth and products for other people. john: really? is it better if a money maker uses money to make more rather than give to charity? i think so. add to that question back to ted turner. >> bill gates says, and get it making money. john: that try to argue this, but he wasn't buying it. john: and i wrong in thinking that i am happy if he gives that the charity? >> when you be happier if he did? you alleges -- this is what people don't like these men. i know your dirty tricks. there is nothing more say. goodbye. i am walking out. john: he did not want to talk about it. let's take that same question to an economist to rise a free-market institute at texas tech. >> i am not bothered if they don't give more of it away. they make their money by making allies that. they are helping people. often that is the best with a can help. john: and then make a profit than they hire people, those jobs live on for years. people use it to educate there kids and feed their family. there is a multiplier. these guys may not even begin dexterity. we know they're good at making money. stick to what your specialty is. >> it's about the results. if leeson to do the things that we want them to do. of course the real reason is that creating the products and services that make our lives better, but as a byproduct they create jobs that make other people better off. it is what is fundamentally responsible for the high standard of living we enjoy. john: said most of them, i would say to my don't feel good about all the wealth they create in their business and guiltily give to charity. even bill gates is now working full time on charity he says he thinks most charity has to come from government. >> a lot of the money that is supporting these causes is coming from the private sector, people like you and less from the government. john: governments are the backbone of this. >> no, no, no. he is good as computers, not it is social policy. just last week had a research paper presented about the great chicago fire of 1871. what happened afterward, there was no fema. it was private charity and civil society organizations the banded together and help get people out of the city who lost their homes, brought in new shelter, clothing. judging from what i was hearing from my work to haggle a lot better than fema of ordering people when they can and cannot go and buts in the process to behalf of. john: a recent edition of forbes magazine, the richest people's list featured philanthropy. so how they are now reading billionaires' by how much they give. a kind of want my heart. let's have a competition. >> there is nothing wrong with people giving money to the causes a thinker valuable. not every good or service will be produced for profit. some of it can come from this segment of society, and it's fine that we recognize that as long as we don't demonize those who aren't doing it and think there's something wrong with them pursuing profit because there is not. that osmanli makes us better off john: there are these tycoons from previous years cornelius vanderbilt and john d. rockefeller and people who vilify them. they did some charity work. they were evil robbers. >> they fundamentally transformed the lives of americans and raising living standards. rockefeller brought us well and made profits. by the way, he probably is also responsible for saving the whales because he pushed down the price of oil it was no longer profitable to how best to extinction henry ford makes jeep automobiles. it does not matter that is motive was profits. he made automobiles affordable for the average middle-class american. the same is true of most of these so-called robber barons of the late 19th and early 20th century. john: thank you. up next, if i put on a fake beard and chemistry of people give me money? ♪ hmm. ♪ mm-hmm. 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[ male announcer ] lease the 2014 ml350 for $599 a month at your local mercedes-benz dealer. ♪ john: it will come to an end. the sooner the better the billions we spend on foreign aid. much of which is squandered or stolen. i agree with ron paul and his son, the senator. we should stop almost all foreign aid. the one libertarians say that people need angry. >> cut off american assistance to these democratic efforts. pull the eight out. what the heck. less than 1 percent of the entire budget of the united states of america. john: it's pretty close to 1%. $35 million. i say we can't afford that. gregory adams runs of sam's 80 effectively says we should spend more. a giant charity it tries to fight poverty over the world. i say, fine. if you want to do that, you raise the money he believes government out of it. >> the issue is that there are some things that charities just can't do. despite the impact that they have around the world, and we are proud of the work that we do with money raised from average americans, there is only so much that we can do with our own projects. some places government needs to step in. john: all right. government needs to make sure aids workers and of being murdered on the way to where they're going. and i should say that you don't take government money from the united states. to other countries. but you call for government to spend more on foreign aid. why when so much has been squandered? >> it is important to know that we're calling for more of the right kind of a. john: this is going to be the right kind. >> there are some things that we think the united states government is doing that we think is not a good use of money. particular, food aid is in desperate need of reform. we miss about half of the value of every dollar that we spend because we require it to be shipped in american vessels, delivering food rather than buying food at the source. john: you also wanted to spend more. >> we want more of the right kind. there are good programs, the millennium celebration that invest in success. the best performing countries rather than subsidizing failure. we want to see more aid given directly to helping small farmers grow more of their own food and you want to see more aid used to support the anti-corruption efforts. john: but what are the odds that that will happen? that the aids support the corrupt dictators as much as half the food aid center at the molly is diverted to corrupt ccntractors, is like militants, local un staff. >> somalia is a difficult environment. john: i will go on. zimbabwean authorities confiscated truck filled with american food aid for school kids and handed it out to supporters of president robert mcgowan boy and a political rally. >> this is one of the problems when the only tool you have is bags of food. john: but by calling for more government aid you are calling for more of the aid that despite all the promises of reform has ended up in the hands of corrupt dictators. >> we are not just calling for more government aid. john: i understand that, and you do some brave work. why do you call for it at all? >> a lot of misconceptions. one of the biggest is that most u.s. assistance actually goes to governments. in fact, that is not true. most goes to u.s. based charities, ngos, contractors. john: and the u.n. >> there is portion that goes. we are very clear that they are not the solution. people on the solution to poverty. john: let's hear from an african entrepreneur. a business and american. but she tried operating a business in her own company -- country of senegal. you agree. >> the combination. foreign aid. government. >> i have a very hard time. the african union itself is admitting it is being siphoned through corruption. john: the swiss bank account. >> swiss bank accounts, real estates in the south of france, the son of the dictator of a equatorial guinea. he was busted by french customs. his plan was intercepted, and they found in the plane 27 fancy cars. i don't know how many furry some bentleys, rolls-royces. john: the only way to stop that is said keep government out of it. you can get a bunch of people who want to give their own money they won't give it to dictators. >> well, not of governments of the same. we actually work with a lot of anti-corruption and human rights activists in countries around the world who are actually working to try to get their governments to govern more accountable. they're interested in u.s. standing with them in joining this fight. too often we take such an approach to u.s. assistance, we try to make it -- we focus on much and a boarding corruption these activists in telling us that they want to us stand together to fight corruption which means that we need to be their standing with them in solidarity working together. john: why the need government aid? why the need government aid? >> government said the only tool that can work to solve some of these accountability problems. it is like asking why the bears need an offensive line. at some point you need these other tools. it will be entrepreneurs who solve the problem of african poverty. but you also need government to do other things. john: you need governments. >> unfortunately at least in most countries in africa government has been the problem. they basically say, as an entrepreneur government does nothing but slow me down on a regular basis. officials bribing me all along. the fact that my truck is parked on a regular basis. and i have to pay a single time in the delays. john: government aid will help fight the corruption. >> i'm sorry. the more you're feeding this huge government the more you choke me from the other end. that is at least the phenomenon that i am awareness of. and the more you give to them the more that is what happens to me. john: we do think that there is role that government can play. in a lot of the places we actually find there is a government deficit. people have to deal with -- john: why do you believe government aid would provide that? has not so far. >> that is actually not true to a lot of success stories. a lot of african countries that the scene. john: to racine them. thank you. coming up, why our man came up to me on the street and said are you john stossel? i hope you die. this is the quicksilver cash back card from capil one. it's not the "limit the cash i earnvery month" card. it's not the "i only earn decent rewards at the gas station" card. it's the no-games, no-signing up, everyday-rewarding, kung-fu-fighting, silver-lightning-in-a-bottle, bringing-home-the-con cash back card. this is the quicksilver card from capital one. unlimited 1.5% cash back on eve purchase, everywhere, every ngle day. so ask yourself, what's in your wallet? ♪ john: someone once came up to me on the street in new york and said, are you john stossel? has said the spd said to my hope you guys in. so what is this hatred about? it turned out he was what people call and anti-poverty lawyer and did things like sue landlords to stop them from evicting people. in his world here in new york capitalism is the enemy, and the only thing that keeps poor people from being totally impressed his government. so because i call for less government and evil. this town, we libertarians are selfish people. and a good guy is called a bleeding heart liberal. so what is this website about? bleeding heart libertarians. talks about social justice and free-market. georgetown university philosophy professor regularly contributes to the site. why? >> the idea is to recapture the soul of libertarianism. what they can and should do is embrace the concept of social justice. john: what does the phrase even mean? i am for social justice. >> right. john: for a lot of people it does not mean anything. it just means socialism. there is a real meaning. course of institutions that you expect other people to live by. john: laws, property rights, family rules come anything like that, one of the tests of those institutions should be that you expect when people live and abide by them attend to produce good consequences for everybody. you can show whether you care about this by asking a question like this. imagine that marxists were right. imagine there were a disaster, they left the overall majority of people destitute. would you still advocate markets? i think most libertarians would say i would at least have some reservations. the fact that they work matters in the justification. if you think that the new advocate whether you know not what philosophers are calling the social justice. john: i'm rand said that do not consider charity a major virtue. selfish. >> what she means is not what most people mean. even if she thinks that i don't think she speaks for most people most are humane, they give to charity, the care that markets work and their work for everybody. the minimum wage, if you did not think that matter why would you argue that because on one. you don't beat you say that the minimum wage causes unemployment among the most laura will people in society and that is part of the reason to oppose it which means that you care of the consequences for the poor. john: the website, bleeding heart libertarian, categories like advocating nurses caring versus helping. >> this explains what is going on with people when they think that libertarians are selfish. if you are on the lefty probably believe that your policies are the only sensible expression of benevolence. you probably think they must disagree with your values and only care of their pocketbooks. that is never really make sense because we have real arguments but also advocacy is cheap. i advocate that we have a 90% marginal tax rate, income over 100,000, if i advocate that it does not cost me anything. if i give money to charity -- john: governments should have a bigger anti-poverty program. >> that costs you nothing but you get the warm glow of altruism when you say you advocate that. put your money where your mouth is. does it actually does something. i know your concern. if you're advocating taking income from other people or yourself and that is all you do your not really showing me that you care. john: it is easy to be generous with other people's money. that is what politicians do. >> that's right. john: thank you. coming up, my take on real charity. ♪ you really love, what would you do?" ♪ [ woman ] i'd be a writer. [ man ] i'd be a baker. [ woman ] i wanna be a pie maker. [ man ] i wanna be a pilot. [ woman ] i'd an architect. what if i told you someone could pay you and what if that person were you? ♪ when you think about it, isn't that what retirement should be, paying ourselves to do what we love? ♪ customer erin swsonves ordebut they didn't fit.line customer's not happy, i'm not happy. sales go down, i'm not happy. merch comes back, i'm not happy. use ups. they make returns easy. unhappy customer becomes happy customer. then, repeat customer. easy returns, i'm happy. repeat customers, i'm happy. sales go up, i'm happy. i ordered another pair. i'm happy. (both) i'm happy. i'm happy. happy. happy. happy. happy. happy happy. i love logistics. ♪ john: i used to be pretty cheap. my mom told me, if you don't save your money you will freeze in the dark. so i saved. but when my career took off and i started getting paid money to make speeches i decided to donate the money to charity, and it changed my life. i realize that i like giving money away. it makes me happy. research on what makes people happy backs that up. on average people who give to charity, whether they give them money or just time, they are happier. so death. it is did for us and get for them. though that depends whom you give to. i put on a fake beard and tried begging in new york city. people gave me money. they gave me money when my cardboard sign said thomas and cold, and even gave when i chased it to needed bier. thank you. thank you. john: when they asked givers why they gave people said things like this. >> he looks pretty neat, i suppose. john: i just beg for an hour, but i did well. but did this for an eight hour day and would have made $90 a 23,000 year. tax-free. that is the reason social workers say not to give to beggars. often it is a scam plan very often you are an enabling. by giving cash to subsidize the biggest drug or alcohol habit. by not giving you may encourage them to give real help. a few respectable charities illicit on the streets. but most were begging or running scams. >> i need your help. i am homeless. john: new york attorney general said this pitch from a group calling itself united homeless is a scam. its director keeps nearly all the money comes bins it on things like his weight watcher bills. i hear you keep most of the money. >> we are homeless people. john: the pages it is going to shelters. >> am i supposed to run a nonprofit and not get money? >> all the people donate absolutely know where the money goes. john: it is hard to find out where your charity money really goes. we can check charity rating services like charity navigator. it is better than nothing. the ratings are not perfect. some charities are not perfect, and rating services sometimes did coned. i give my charity money to groups that i can check out myself, a group that rehabs ex-con and attics. i decided they do a good job because i could see these men. they call them men in blue, ready, willing, able. the clean-air bill york city streets. what is hot is that they do is bring in a step in look cheerful and work fast. i thought whoever is working with these guys has done something right, taught them to take pride in work. i give them money in a couple of other groups that back and watch. while i give to what i think are good charities, we should not forget about the people of, capitalists, on this once. but job creators do much more good for the world that politicians. and more even than that do-gooders' working for charity. i am delighted that the singer bought of figure that out after spending years calling for government to spend more in foreign-aid flop. now he says the best hope for the four is free markets. >> preaching capital. >> sometimes i hear myself, and i just cannot believe it. commerce is real. just a stopgap. >> commerce and on to panera capitalism takes more people out of poverty. we know that. john: politicians don't know that. many americans don't know it. it is time that they learned. entrepreneurial capitalism takes more people out of poverty and a never well. that is our show. see you next week. ♪ dobbs tonight." have a good evening. ♪ lou: senate majority leader harry reid went nuclear today. the democrats throughout a key role that has been in place in the senat for more than two centuries. senator reid said the reason for voting at the filibuster on presidential nominations with the exception ofupreme court justices is to remedy obstructiosm. but with this president and administration, now in a web of historically is and mr. obama in a ratings free fall, today's filibuster busting vote may be as much about changing the subject and diverting media attention. i am lou dobbs. ♪ good evening
government you're going to be in for an awful long way. john: if they get it may be seen more people will realize there are better ways to give. real charity. that is our sw tonight. ♪ >> and now. ♪ john: what is real charity? people are in trouble after a disaster or simply when people are poor. americans instead is to think amount and government help. after all, who will help those people is not government? libertarians argue that private charity would step in. individuals really choosing to help. but with enough of us up? most people say no. that is why liberals like newsday columnist say when it comes to helping the need, that is mostly government's job. >> well, listen, it would be great if people of reach into their heartsnd solved all these will problems. that does not happen. in almost every single case where they're is a government program that exists because the private efforts. when you have 04 enough. john: that is because politicians said they were not enough and we could do better. i would argue that a government did not takes a much of our money the private sector would take care of these problems. >> hold on a second. let's get older americans. the poorest sector of our society. something called social security camelot. medicare came along. all the people really do comparatively fairly well. we had hundred kids spread all across america. those numbers were cut dramatically in spite of the generous churches and nice people. >> programs are trillions in debt. unsustainable. >> maybe we have to tweak. but you can't throw away the idea. the reality is we need vernment then there. john: food stamps, a couple billionaires' could find that all program by themselves. and a private charity would be better as saying who really needs the food help and to is giving the system. >> i would love that. you know a billionaire who wants to pay to my think we would welcome that. john: did not step in because you're a big fat government is there. people say, oh, the government does that. >> here is the reality in real life. all these private efforts are really important. generous people. we give a lot of money. when the chips are really down and the big thing happens, the typhoon hits the philippines, we love the red cross effort. but they don't have an aircraft carrier with marines on board and rescue helicopters. the u.s. military does. i want them steaming toward the philippines when that's-it's. john: i don't know what will happen. in haiti our government promised billions of dollars, billion of it is not done to the people. the new york times said there were going to build 15,00 alums, latest target fewer than 3,000. >> your argument is that government sometimes does not do a perfect job. i concede that. john: i want to play along perversion of the clip earlier. to my left-wing colleagues were talking about how after a disaster faith based charities work better and disaster relief and fema. >> there is fema and then there is the fai based fema. >> if you're waiting for the government you are going to be in for an awful long wait. >> talking about the government response after the tornado in oklahoma in may. now 30 churches banded together to help much more quickly and did a better job in government. this happened with katrina. fema was turning away walmart. people were trying to get water. sending its water to the wrong place. >> you're right. as you know, i am a native of new orleans. there are some thin that the province to well. all those kids,onderful young people who came down, church groups, they did something much better than government. but they were still an awful lot of things that we needed government. remember how angry folks were. no one said stay away. john: walmart and private charities got there. >> maybe one of the things of the privates can do is be more nimble. if you are talking about rebuilding, i don't think you want the government to take a pass. john: i do. let's talk about the war on poverty. lyndon johnson said he would and poverty. here is where the war began. and sure enough it dropped sharply the first five, seven years after that. to then it stopped improving. >> we teach people to be dependent. that was happening before the war. americans were lifting themselves out of poverty. government continue the progress for five years and then stopped it. >> we should have been more generous, done the other things that government can do to help folks. john: government does not teach a dependency. >> i am not here saying government is profit. government has some bad things, clumsy, bureaucratic. there are things it does really well. hey, private folks, step up. john: these graphs of the test. can we put these up. john: the recession, but it goes up steadily. two lines referred to one is the number of people collecting in the other is the cost. we are teaching people to be passive. >> i will grant you that is something weant to avoid. what is the solution from a look at the people and say we will take your food stamps a way? up for the best. >> limit the program some of the private sector stepped in. one more example is the rise of disability test people. straht out. you have fewer people doing manual labor, medicine is better , and more people are disabled. >> i am with you on that one. john: if you want to get rid of it. >> no, i don't want to get rid of it. certainly we can look more closely as of the applications. john: cut it way back. there's a place near college of center, a government office supposedly to help people find jobs. i went there. people said,here are no jobs. we then went around 40 job offers, 28 and to build positions, one restaurant owner said, i would hire a dozen people live there would just apply. >> i would throw we take nine with no experiencen trenton. john: and that the welfare of a steeple told us there are no jobs. >> the plenty of jobs. john: government jobs offices to encourage people to take welfare. as somebody go and ask for help to see if it would help her get a job and they said, no, they just to reach for welfare and food stamps. >> again, it is much smarter to have programs that encourage people to work, don't reward ziness,. john: they all do that. >> i don't know. john: private charities and of any suppression did he tell. >> the answer can be to just cut it back a mechanic? john: get it back. and let the private sector in. we will stop there. thank you. atomize a private charity should replace government. what about the rest of the world? people assum global poverty is a problem. it has to be addressed by government giving out foreign aid or maybe the wind. the u.s. and contradicts the title of my book by saying, yes, we, governments, working together can end poverty in just two years. while. two years. of course 50 years ago lyndon johnson claimed his war on poverty would end poverty in america. the u.n. will do better. ted turner gave him a billion dollars for this. individual governments and squandered nearly a trillion dollars of foreign aid trying to lift people out of poverty in africa. i say squandered because after they spent trillions for income per capita it went down. that is may because the foreign aid encourages dependency and african kleptocrats government steal much of the money. what is the alternative? michael fay says he has an answer. wh is yours? >> we are going straight to the port. cash transfers from you directly to them. no middleman, no leakage, no hidden costs. john: the charity, and you have raised about $6 million. just given 27,000 people-the thousand dollars each. >> that is exactly right. a thousand for the households. john: this sounds like a stupid idea. they will justpend it and then it won't have any. >> you are not the only one. the truth is there has been about a decade of research that shows the exact opposite. what are these people missing? a lot of them are missing the capital. we have the old expression teach a man to fish. the truth is they don't have fishing poles. john: so you allow them to b fishing pole or in this case this may have been a guy who got a motorcycle and use it for a taxi service. >> this is a used motorcycle that he bought with cash and now provides tax to services. john: he gives the people a cell phone with the money. >> that is the way we transfer the money. found the phone. if they don't have a phone them in a deal to get the money. john: and it is easier to check up on them. >> we check, call them, talk to them regularly. john: people build metal roofs. the most popular thing. >> no charity. saves income, clean water, was malaria. we did not think of it, they did. john: before they had that they had at that's true fan is bad about a hundred dollars a year.a business, another person had received training from another charity to be a welder. >> said he was snding there doing nothing. he did not have welding equipment. john: what makes you think this work? >> we have a decade of evidence, we have done our own third-party valuation. we know income goes up a monstrous level goes down, under follows. john: you donother odd thing. none of your charity board members works full-time for your charity. >> here is the great thing. if it is not working i would not lead to -- need to lie the right attitude my job. john: you could be more honest evaluating it. the charities delude themselves. >> well, i think people have passion and often implies evidence. john: i have hard time accepting i just criticize government pro grams because they don't teach people to take care of themselves. i guess giving cash once and knowing that it ll keep coming is different. >> a onetime transforming event it does not matter who does it. matters what they do. why buy a cow when the person is to will then. john: to take care of it? look to make the choice. john: i hope it works. i'm glad a lot of these experiments are going on. thank you. if you would like to keep this conversation going go to facebook or twitter and use that has tank. real charity. that people know what you think. coming up, president obama's says the way to help poor people is to give them a free cell phone. ♪ you really love, what would you do?" ♪ [ woman ] i'd be a writer. [ man ] i'd be a baker. [ woman ] i wanna be a pie maker. [ man ] i wanna be a pilot. [ woman ] i'd be an architect. what if i told you someone could pay you and what if that person were you? ♪ when you think about it, isn't that what retirement should be, paying ourselves to do what we love? ♪ ♪ >> the government will pay for you to have a free cell phone with monthly minutes, no credit check and no deposit required. john: of free cell phone. 253 minutes. what the deal. this is to help poor people in need a lifeline. that is reasonable. this is a government program that began with ronald reagan. president obama expanded it, of course. and in just four years the costs tripd and will continue rice can. >> a minority. you know. he gave up. , no income, disability. john: the more free stuff you get the more you're eligible to get. but eligible is. what did you do? >> i went to all the welfare offices in manhattan and a couple in brooklyn and found out that there are people of their approach you on the street as the if you have your free phone yet. outside the office. john: private entrepreneur. >> and not on welfare. i told them that. i would like to be buried at think a lot of the people would like to be. but that was enough. they ended up giving me not one, not to, but three free phones. john: the good news is someplace is turned down. >> yeah. they ended up. first of, you are not supposed to have duplicate files which i have already broken and will. there also supposed to check eligibility. they also did not catch the eye and multiple applications and and try to work power to the system again and again. john: and fcc audit, they found 41 percent o the recipients never demonstrated that they were eligible. >> that's about 6 million people. the what you really see is the phone companies have a very perverse incentive to push those bonds and on the street. they get $9.25 per customer per month for this program. the street vendors -- john: is paid for out of your phone bill. if you botred to read the fine print, there is something called the universal service charge. this was under ronald reagan, make sure everybody and a phone line. universal service. a dollar and two out of every race home built. bison i think that most taxpayers don't know what. i went out and investigated. i didn't know. john: bore people talk to their families. >> the phone comnies of the bad guys in this. this is a huge business. the mexican billionaire, one of the richest people in the world. john: he may be the richest. >> csn bill gates compete. but he got in 2011 alone half a billion dollars from this program. so what turned out to be welfare for the poor is actually corporate welfare plan in simple john and what about my obnoxious question. you don't want to help the poor? >> well, i think maybe there would be justification for a land line. as with a program started out as, but anytime you have perverse incentives for companies to go and no phones combined with the very poor oversightou he to ask yourself, you creating a situation in which fraud and abuse can just compound? that is what we have. john: it should not surprise anyone that government charity is susceptible to fraud. the contractors doing the work. no one's money. the more they give out the more they get to keep. they get a commission on each give away. the cellphone charities, $2 billion. think about the hundreds of billions spent on medicare and medicaid. much more from there. people work out with all this stuff. one man alone spent $20 million on this diamond jewelry, also a fleet of luxury cars, one after the other. all of which she got because government paid millions for medical treatment that never happened. government health is just extra susceptible to abuse. >> and is definitely what i found. was surprised that i was able to get three of them in violation a pretty much every program wall, and if i can do it being someone he tells the truth, just a man from the people. actually willing to abuse the program. john: private companies get ripped off. but they have me of an incentive to check. it's their own money. >> that's right. georgia is actually doing reform within the states to try to see if they can mess with that fundamental flaw in incentive structure. ere will start charging $5 for consumers. they have to pay $5 spirit there less likely to god a by. john: thank you. coming up, better ways tell people. ♪ this is the quicksilver cash back card from capital one. it's not the "fumbling around with rotating categories" card. it's not the etting blindsided by limits" card. it's the no-game-playing, no-earning-limit-having, deep-bomb-throwing, give-me-the-ball-and-i'll-take- it-to-the-house, cash back card. this is the quicksilver cash cd from capital one. unlimited 1.5% cash back on every purchase, everywhere, every single day. so let me k you... at's in your wallet? ♪ john: one of the richest people in the world is warren buffett. is the jeep? he is one of many billionaire sue until recently gave very little to charity. he used his money to try to make more money. he said he would give it away when he died. his fellow billionaire ted turner told me buffett was being cheap. >> she should give some away now john: turner just made a big splash b giving a billion dollars to the wind. now he said he wanted to shame other richeople into giving more. >> what he said is bad and the stupid. john: that was his answer. >> what he should do is take his money and invested. he can help people in the other better way into invested and have the companies in building in plans that creating the investment creates jobs and wealth and products for other people. john: really? is it better if a money maker uses money to make more rather than give to charity? i think s. add to that question back to ted turner. >> bill gates says, and get it making money. john: that try to argue this, but he wasn't buying it. john: and i wrong in thinking that i am happy if he gives that the charity? >> when you be happier if he did? you alleges -- this is what people don't like these men. i know your dirty tricks. there is nothing more say. goodbye. i am walking out john: he did not want to talk about it. let's take that same question to an economist to rise a free-market institute at texas tech. >> i am not bothered if they don't give more of it away. they make their money by making allies that. they are helping pple. often that is the best with a can help. john: and then make a profit than they hire people, those jobs live on for years. people use it to educate there kids and feed their family. there is a multiplier. these guys may not even begin dexterity. we know they're good at making money. stick to what your specialty is. >> it's about the results. if leeson to do the things that we want them to do. of course the real reason is that creating t products and services that make our lives better, but as a byproduct they create jobs that make other people better off. it is what is fundamentally responsible for the high standard of living we enjoy. john: said most of them, i would say to my don't feel good about all the wealth they create in their business and guiltily give to charity. even bill gates is now working full time on charity he says he thinks most charity has to come from government. >> a lot of the money that is supporting these coming from the private sector, people like you and less from the government. john: governments are the backbone of this. >> no, no, no. he isood as computers, not it is social policy. just last week had a research paper presented about the great chicago fire of 1871. what happened afterward, there was no fema. it was private charity and civil society organizations the banded together and help get people out of the city who lost their homes, brought in new shelter, clothing. judging from what i was hearing from my work to haggle a lot better than fema of ordering people when they can and cannot go and buts in the process to behalf of. john: a recent edition of forbes magazine, the richest people's list featured philanthropy. so how they are now reading billionaires' by how much they give. a kind of want my heart. let's have a comtition. >> there is nothing wrong with people giving money to the causes a thinker valuable. not every good or service will be produced for profit. some of it can come from this segment of society, and it's fine that we recognize that t as long as we don't demonize those who aren't doing it and think there's something wrong with them pursuing profit because there is not. that osmanli makes us better off john: there are these tycns from previous years cornelius vanderbilt and john rockefeller and people who vilify them. they did some charity work. they were evil robbers. >> they fundamentally transformed the lives of americans and raising living standards. rockefeller brought us well and made profits. by the way, he probably is also responsible for saving the whales because he pushed down the price of oil it was no longer profitable to how best to extinction henry ford makes jeep automobiles. it does not matter that is motive was profits. he made automobiles affordable for the average middle-class american. the same is true of most of these so-called robber barons of the late 19th and early 20th century. john: thank you. up next, if i put on a fake beard and chemistry of people ♪ john: it will come to an end. the sooner the better the billions we spend on foreign aid. much of which is squandered or stolen. i agree with ron paul and his son, the senator. we should stop almost all foreign aid. the one libertarians say that people need angry. >> cut off american assistance to these docratic efforts. pull the eight out. what the heck. less than 1 percent of the entire budget of the united states of america. john: it's pretty close to 1%. $35 million. i say we can't afford that. gregory adams runs of sam's 80 effectively says we should spend more. a giant charity it tries to fight poverty over the world. i say, fine. if you want to do that, you raise the money he believes government out of it. >> the issue is that there are some things that charities just can't do. despite the iact that they have around the world, and we are proud of the work that we do with money raised from average americans, there is only so much that we can do with our own projects. some places government needs to step in. john: all right. government needs to make sure aids workers and of being murdered on the way to where they're going. and i should say that you don't take government money from the united states. to other countries. but you call for government to spend more on foreign aid. why when so much has been squandered? >> it is important to know that we're calling for more of the right kind of a. john: this is going to be the right kind. >> there are some things that we think the united states government is doinghat we think is not a good use of money. particular, food aid is in desperate need of reform. we miss about half of the value of every dollar that we spend because we require it to be shipped in american vessels, delivering food rather than buying food at the source. john: you also wanted to spend more. >> we want more of the right kind. there are good programs, the millennium celebration that invest in success. the best performing countries rather than subsidizing failure. we want to see more aid given directly to helping small farmers grow more of their own food and you want to see more aid used to support the anti-corruption efforts. john: but what are the odds that that will happen? that the aids support the corrupt dictators as much as half the food aid center at the molly is diverted to corrupt ccntractors, is like militants, local un staff. >> somalia is a difficult environment. john: i will go on. zimbabwean authorities confiscated truck filled with american food aid for school kids and handed it out to supporters of president robert mcgowan boy and a political rally. >> this is one of the problems when the only tool you have is bags of food. john: but by calling for more government aid you are calling for more of the aid that despite all the promises of reform has ended up in the hands of corrupt dictators. >> we are not just calling for more government aid. john: i understand that, and you do some brave work. why do you call for it at all? >> a lot of misconceptions. one of the biggest is that most u.s. assistance actually goes to governments. in fact, that is not true. most goes to u.s. based charities, ngos, contractors. john: and the u.n. >> there is portion that goes. we are very clear that they are not the solution. people on the solution to poverty. john: let's hear from an african entrepreneur. a business and american. but she tried operating a business in her own company -- country of senegal. you agree. >> the combination. foreign aid. government. >> i have a very hard time. the african union itself is admitting it is being siphoned through corruption. john: the swiss bank account. >> swiss bank accounts, real estates in the south of fnce, the son of the dictator of a equarial guinea. he was busted by french customs. his plan was intercepted, and they found in the plane 27 fancy cars. i don't know how many furry some bentleys, rolls-royces. john: the only way to stop that is said keep government out of it. you can get a bunch of people who want to give their own money they won't give it to dictators. >> well, not of governments of the same. we actually work with a lot of anti-corruption and human rights activists in countries around the world who are actually working to try to get their governments to govern more accountable. they're interested in u.s. standing with them in joining this fight. too often we take such an approach to u.s. assistance, we try to make it -- we focus on much and a boarding corruption these activists in telling us that they want to us stand together to fight corruption which means that we need to be their standing with them in solidarity working together. john: why the need government aid? why the need government aid? >> government said the only tool that can work to solve some of these accountability problems. it is like asking why the bears need an offensive line. at some point you need these other tools. it will be entrepreneurs who solve the problem of african poverty. but you also need government to do other things. john: you need governments. >> unfortunately at least in most countries in africa government has been the problem. they basically say, as an entrepreneur government does nothing but slow me down on a regular basis. officials bribing me all along. the fact that my truck is parked on a regular basis. and i have to pay a single time in the delays. john: government aid will help fight the corruption. >> i'm sorry. the me you're feeding this huge government the more you choke me from the other end. that is at least the phenomenon that i am awareness of. and the more you give to them the more that is what happens to me. john: we do think that there is role that government can play. in a lot of the places we actually find there is a government deficit. people have to dl with -- john: why do you believe government aid would provide that? has not so far. >> that is actually not true to a lot of success stories. a lot of african countries that the scene. john: to racine them. thank you. coming up, w our man came up to me on the street and said are you john stossel? i hope you die. @? ♪ john: someone once came up to me on the street in new york and said, are you john stossel? has said the spd said to my hope you guys in. so what is this hatred about? it turned out he was what people call and anti-poverty lawyer and did things like sue landlords t. in his world here in new york capitalism is the enemy, and the only thing that keeps poor people from being totally impressed his government. so because i call for less government and evil. this town, we libertarians are selfish people. and a good guy is called a bleeding heart liberal. so what is this website about? bleeding heart libertarians. talks about social justice and free-market. georgetown university philosophy professor regularly contributes to the site. why? >> the idea is to recapture the soul of libertarianism. what they can and should do is embrace theonceptf social justice. john: what does the phrase even mean? i am for social justice. >> right. john: for a lot of people it does not meannything. it just means socialism. there is a real meaning. course of institutions that you expect other people to live by. john: laws, property rights, family rules come anything like that, one of the tests of those institutions should be that you expect when people live and abide by them attend to produce goodonsequences for everybody. you can show whether you care about this by asking a question like this. imagine that marxists were right. imagine there were a disaster, they left the overall majority of people destitute. would you still advocate markets? i think most libertarians would say i would at least have some reservations. the fact that they work matters in the justification. if you think that the new advocate whether you know not what philosophers are calling the social justice. john: i'm rand said that do not consider charity a major virtue. selfish. >> what she means is not what most people mean. even if she thinks that i don't think she speaks for most people most are humane, they give to charity, the care that markets work and their work for everybody. the minimum wage, if you did not think that matter why would you argue that because on one. you don't beat you say that the minimum wage causes unemployment among the most laura will people in society and that is part of the reason to oppose it which means that you care of the consequences for the poor. john: the website, bleeding heart libertarian, categories like aocating nurses caring versus helping. >> this explains what is going on with people when they think that libertarians are selfish. if you are on the lefty probably believe that your policies are the only sensible expression of benevolence. you probably think they must disagree with your values and only care of their pocketbooks. that is never really make sense because we have real arguments but also advocacy is cheap. i advocate that we have a 90% marginal tax rate, income over 100,000, if i advocate that it does not cost me anythg. if i give money to charity -- john: governments should have a bigger anti-poverty program. >> that costs you nothing but you get the warm glow of altruism when you say yo advocate that. put your money where your mou is. does it actually does something. i know your concern. if you're advocating ting income from other people or yourself and that is all you do your not really showg me that u care. john: it is easy to be generous with other people's money. that is what politicians do. >> that's right. john: thank you. coming up, my take on real charity. ♪ ♪ john: i used to be pretty cheap. my mom told me, if you don't save your money you will freeze in the dark. so i saved. but when my career took off and i started getting paid money to make speeches i decided to donate the money to charity, and it changed my life. i realize that i like giving money away. it makes me happy. research on what makes people happy backs that up. on average people who give to charity, whether they give them money or just time, they are happier. so death. it is did for us and get for them. though that depends whom you give to. i put on a fake beard and tried begging in new york city. people gave me money. they gave me money when my cardboard sign said thomas and cold, and even gave when i chased it to needed bier. thank you. thank you. john: when they asked givers why they gave people said things like this. >> he looks pretty neat, i suppose. john: i just beg for an hour, but i did well. but did this for an eight hour day and would have made $90 a 23,000 year. tax-free. that is the reaso social workers say not to give to beggars. often it is a scam plan very often you are an enabling. by giving cash to ssidize the biggest drug or alcohol habit. by not giving you may encourage them to give real help. a few respectable charities illicit on the streets. but most were begging or running scams. >> i need your help. i am homeless. john: new york attorney general said this pitch from a group calling itself uned homeless is a scam. its director keeps nearly all the money comes bins it on things like his weight watcher bills. i hear you keep most of the money. >> we are homeless people. john: the pages it is going to shelters. >> am i supposed to run a nonprofit and not get money? >> all the people donate absolutely know where the money goes. john: it is hard to find out where your charity money really goes. we can check charity rating services like charity navigator. it is better than nothing. the ratings are not perct. so charities are not perfect, and rating services sometimes did coned. i give my charity money to groups that i can check out myself, a group that rehabs ex-con and attics. i decided they do a good job because i could see these men. they call them men in blue, ready, willing, able. the clean-air bill york city streets. what is hot is that they do is bring in a step in look cheerful and work fast. i thought whoever is working with these guys has done something right, taught them to take pride in work. i give them money in a couple of other groups that back and watch. while i give to what i think are good charities, we should not forget about the people of, capitalists, on this once. but job creators do much more good for the world that politicians. and more even than that do-gooders' working for charity. i am delighted that the singer bought of figure that out after spending years calling for government to spend more in foreign-aid flop. now he says the best hope for the four is free markets. >> preaching capital. >> sometimes i hear myself, and i just cannot believe it. commerce is real. just a stopgap. >> commerce and on to panera capitalism takes more people out of poverty. we know that. john: politicians don't know that. many americanson't know it. it is time that they learned. entrepreneurial capitalism takes more people out of poverty and a never well. that is our show. see you next week. ♪ [dave gentry] hello, i'm dave ntry. welcome to small stocks and big money. 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for an awful long way. john: if they get it may be seen more people will realize there are better ways to give. real charity. that is our show tonight. ♪ >> and now. ♪ john: what is real charity? people are in trouble after a disaster or simply when people are poor. americans instead is to think amount and government help. after all, who will help those people is not government? libertarians argue that private charity would step in. individuals really choosing to help. but with enough of us up? most people say no. that is why liberals lik newsday columnist say when it comes to helping the need, that is mostly gernment's job. >> well, listen, it would be great if people of reach into their hearts and solved all these will problems. that does not happen. in almost every single case where they're is a government program that exists because the private efforts. when you have enough. john: that is because politicians said they were not enough and we could do better. i would argue that a government did not takes a much of our money the private sector would take care of the problems. >> holdn a second. let's get older americans. the poorest sector of our society. something called social security camelot. medicare came along. all the people really do comparatively fairly well. we had hundred kids spread all across america. those numbers were cut dramatically in spite of the generous churches and nice people. >> programs are trillions in debt. unsustainable. >> maybe we have to tweak. but you can't throw away the idea. the reality is we need vernment then there. john: foodtamps, a couple billionaires' could find that all program by themselves. and a private charity would be better as saying who really needs the food help and to is giving the system. >> i would love that. you know a billionaire who wants to pay to my think we would welcome that. john: did not step in because you're a b fat government is there. peopleay, oh, the government does that. >> here is the reality in real life. all these privatefforts are really important. generous people. we give a lot of money. when the chips are really down and the big thing hapns, the typhoon hi the philippines, w love the red cross effort. but they d't have an aircraft carrier with marines o board andescue helicopters. the u.s. military does. i want them steaming toward the philippines when that's-it's. john: i don't know what will happen. in haiti ourovernment promised billions of dollars, billion of it is not done to the people. the new york times said there were going to build 15,000 alums, latest target fewer than 3,000. >> your argument is that government sometimes does not do a perfect job. i concede that. john: i want to play along peersion of the clip earlier. to my left-wing colleagues were talking about how after a dister faith based charities work better and disaster relief and fema. >> there is fema and then there is the faith based fema. >> if you're waiting for the government you are going to be in for aawful long wait. >> talking about the government response after the tornado in oklahoma in may. now 30 churches banded together to help much more quickly and did a better job in government. this happened with katrina. fema was turning away walmart. people were trying to getwater. sending its water to the wrong place. >> you're right. as you know, i am a native of new orleans. there are some things that the province to well. all those kids, wonderful young people who came down, crch grou, they did something much better than government. but they were still an awful lot of things that we needed government. remember how angry folks were. no one said stay away. john: walmart and private charities got there. >> maybe one of the things of the privates cano is be more nimble. if you are talking about reildi, i don think you want the government to take a pass. john: i do. let's talk about the war on poverty. lyndon johnson said he would and poverty. here is where the war began. and sure enough it dropped sharply the first five, seven years after that. to then it stopped improving. >> we teach people to be dependent. .hat was happening before the americans were lifting themselves out of poverty. government continue the progress for five years and then stopped it. >> we should have been more generous, done the other things th government can do to help folks. john: government does not teach a dependency. >> i am not here saying government is profit. governmentas some bad things, clumsy, bureucratic. there are things it does really well. hehey, private folks, step up. john: these graphs of the test. can we put these up. john: the recession, t it goes up steadily. two lines referred to one is the number of people collecting in the other is the cost. we are teaching people to be passive. >> i i will grant you that is something we want to avoid. what is the solutn from a look at the people and say we will take your food stamps a way? up for the best. >> limit the program some of the private sector stepped in. one more example is the rise of disability tes people. straight out. you have fewer people doing manual labor, medicine is better , and more people are disabled. >> i am with you on that one. john: if you want to get rid of it. >> no, i don't want to get rid of it. certainly we can look more closely of the applications. john: cut itay back. there's a place near college of center, a government office supposedly to help people find jobs. i went there. people said, there are no jobs. we then went around 40 job offers, 28 and to build positions, one restaurant owner said, would hire a dozen people live there would just apply. >> i would throw we take nine with no experience in trenton. john: and that the welfare of a steeple told us there are no jobs. >> there plenty of jobs. john: government jobs offices to encourage people toake welfare. as somebody go and ask for help to see if it would help her get a job and they said, no, they just to reach for welfare and food stamps.. >> again, it is much smarter to have programs that encourage people to work, don't reward laziness,. john: they all do that. >> don't know. john: pvate charities and of any suppression did he tell. >> the answer can be to just cut it back a mechanic? john: get it back. and let the private sector in. we will stop there. thank you. atomize a private charity should replace government. what about the rest of the world? people assume global poverty is a problem. it has to be addressed by gornment givingut foreign aid or maybe the wind. the u.s. and contradicts the title of my book by saying, yes, we, governments, working together can end poverty in just two years. while. two years. of course 50 years ago lyndon johnson claimed his war on poverty would end poverty in america. the u.n. will do better. ted turner gave him a billion dollars for this. individual governments and squandered nearly a trillion dollars of foreign aid trying to lift peoplout of poverty in africa. i say squandered because after they spent trillions for income per capita it went down. that isaybe because the foreign aid encourages dependency and african kleptocrats governmt steal much of the money. what is the alternative? michael fay says he has an answer. what is yours? >> we are going straight to the port. cash transfers from you directly to them. no middleman, no leakage, no hidden costs. john: the charity, and you have raised about $6 million. just given 27,000 people-the thousand dollars each. >> that is exactly right. a thousand for the households. john: this sounds like a stupid idea. they will just spend it and then it won't have any. >> you are not the only one. the truth is there has been about a decade of research that shows the exact opposite. what are these people missing? a lot of them are missing the capital. we have the old expression teach a man to fish. e truth is the don't have fishing poles. john: so y allow them to buy a fishing pole or in this case this may havbeen a guy who got a morcycle and use it for a taxi serce. >> this is a used motorcycle that he bought with cash and now provides tax to services. john: he gives the people a cell phone with the money. >> that is the way we transfer the money. found the phone. if they don't have a phone them in a deal to get the money. jo: and it is easier to check up on them. >> we check, call tm, talk to them regularly. john: people build metal roofs. the most popular thing. >> no charity. saves income, clean water, was malari we did not think of it, ty did. john: before they had that they had at that's true fan is bad about a hundred dollars a year. john: instead they can start a business, another person had received training from another charity to be a welder. >> said he was standing there doing nothing. he did not have welding equipment john what makes you think this work? >> we have a decade of evidence, we have done our own third-party valuation. we know income goes up a monstrous level goes down, under follows. john: you do another odd thing. none of your charity board members works full-time for your charity. >> here is the great thing. if it is not working i would not lead to -- need to lie the right attitude my job. john:you could be more honest evuating it. the charities delude themselves. well, i think people have passion and often implies evidence. john: i have hard time accepting i just criticize government pro grams because they don't teach people to take care of themselves. i guess giving cash once and knowing that it will keep coming is different. >> a onetime transforming event it does not matter who does it. matters what they do. why buy a cow when theerson is to will then. john: to take care of it? look to make the choice. john: i hope it works. i'm glad a lot of these experiments are going on. thank you. if you would like to keep this conversation going go to fabook or twitter and use that has tank. real charity. that people know what you think. coming up, president obama's says the way to help poor people is to give them a free cell phone. ♪ @@@@@@@@@@@@@@@@@@@@ where's tommy? i thought he was wh you. no. jack! (playing twinkle, twinkle, little star.) don't stop! keep playing! here we go. here's the fun part! ♪ >> the government will pay for you to have a free cell phone with monthly minutes, no credit checand no deposit required. john: of free cell phone. 253 minutes. what the deal. this is to help poor people in need a lifeline. that is reasonable. this is a government program that began with ronald reagan. presidenobama expanded it, of course. and in just fr years the costs tripled and will continue rice can. >> a minority. you know. he gave up. , no income, disability. john: the more free stuff you get the more you're eligible to get. but eligible is. what did you do? >> i wento all the welfare offices in manhattan and a couple in brolyn and found out that there are people of their approach you on the street as the if you have your free phon yet. outside the office. john: private entrepreneur. >> a not on welfare. i told them that. i would like to be buried at think a lot of the people would like to be. but that was enough. th ended up giving me not one, not to, but three free phones. john: the good news is someplace is turned down. >> yea they ended up. first of, you are not supposed to have duplicate files which i have already broken and will. there also supposed to cck eligibility. they also did not catch the eye and multiple applications and and try to work power t the system again and again. jo: and fcc audit, the found 41 pernt of the recipients never demonstrated that they were eligible. >> that's about 6 million people. the what you really see is the phone companies hava very perverse incentive to push those bonds and on the street. they get $9.25 per customer per month for this program. the street vendors -- john: is paid for out of your phone bill. if you bothered to read the fine print, there is something called the universal service charge. this was under ronald reagan, make sure everybody and a phone line. universal service. a dollar and two out of every race home built. bison i think that most taxpayers don't know what. i went out and investigated. i didn't know. john: bore people talk to their families. >> the pho companies of the bad guys in this. this is a hugeusiness. the mexican billionaire, one of the richest people in the world. john: he may be the richest. >> csn bill gates compete. but he got in 2011 alone half a billion dollars from this program. so what turned out to be welfare for the poor is actually corporate welfare plan in simple john: and what about my obnoxious question. you don't want to help the poor? >> well, i think maybe there would be justification for a land line. as with a program started out as, but anytime you have perverse incentives for companies to go and no phones combined with the very poor oversight you have to ask yourself, you cating a situation in which fra and abuse can just compound? that is what we have. john: it should not surprise anyone that government charity is susceptible to fraud. the contractors doing the work. no one's money. the more they give out the more they get to keep. they get a commission on each give away. the cellphone charities, $2 billion. think about the hundreds of billions spent on medicare and medicaid. much more from there. people work out with all this stuff. one man alone spent $20 million on thisiamond jewelry, also a fleet of luxury cars, one after the other. all of which she got because government paid millions for medical treatment that never happened. government health is just extra susceptible to abuse. >> and is definitely what i found. was surprised that i was able to get three of them in violation a pretty much every program wall, and if i can do it being someone he tells the truth, just a man from the people. actually willing to abuse the program. john: private companies get ripped off. but they have more of an incentive to check. it's their own money. >>hat's right. georgia is actually doing reform within the states to try t see if they can mess with that fundamental flaw in incentive structure. there will start charging $5 for consumers. they have to p $5 spirit there less likely to god and by. john: thank you. coming up, better ways tell people. ♪ ♪ john: one of the richest people in the world is warren buffett. is the jeep? he is one of my billionaire sue until recently gave very little to charity. he used his money to try to make more money. he said he would give it away when he died. his fellow billionaire ted turner told me buffett was being cheap. >> she should give some away now john: turner just made a big splash by giving a billion dollars to the wind. now he said he wanted to shame other rich people into giving more. >> what he said is bad a and the stupid. john: that was his answer. >> what he should do is take his money and invested. he can help people in the other better way into invested and have the companies in building in plans that creating the investment creates jobs and wealth and products for her people. john: really? is it better if a money maker uses money to make more rather than give to charity? i think so. add to that questn back to ted turner. >> bill gates says, and get it making money. john: that try to argue this, but he wasn't buying it. hn: and i wrong in thinking that i am happy if he gives that the charity? >> when you be happier if he did? you alleges -- this is what people don't like these men. i know your dirty tricks. there is nothing more say. gobye. i am walking out. john: he did not want to talk about it. let's take that same question to an economist to rise a free-market institute at texas tech. >> i am not bothered if they don't give more of it away. they make their money by making allies that. they are helping people. often that is the best with a can help. john: and then make a profit than they hire people, those jobs live on for years. people use it to educate there kids and feed eir family. there is a multiplier. these guys may not even begin dexterity. we know they're good at making money. stick to what your specialty is. >> it's about the results. if leeson to do the things that we want them to do. of course the real reason is that creating the products and services that make our lives better, but as a byproduct they create jobs that make other people better off. it is what is fundamentally responsible for the high standard of living we enjoy. john: said most of them, i would say to my don't feel good about all the wealth they create in their business and guiltily give to charity. even bill gates is now working full time on charity he says he thinks most charity has to come from government. >> a lot of the money that is supporting these causes is coming fromhe privateector, people like you and less from the government. john: governments are the backbone of this. >> no, no, no. he is good as computers, not it is social policy. just last week had a research paper presented about the great chicago fire of 1871. what happened afterwa, there was no fema. it was private charity and civil society organizations the banded together and help get people out of the city who lost their homes, brought in new shelter, clothing. judging from what i was hearing from my work to haggle a lot better than fema of ordering people when they can and cannot go and buts in the process to behalf of. john: a recent editionf forbes magazine, the richest people's list featured philanthropy. so how they are now reading billionaires' by how much they give. a kind of want my heart. let's have a competition. >> there is nothing wrong with people giving money to the causes a thinker valuable. not every good or service will be produced for profit. somef it can come from this segment of socie, and it's fine that we recognize that as long as we don't demonize those who aren't doing it and think there's something wrong with them pursuing profit because there is not. that osmanli makes us better off john: there are these tycoons from previous years cornelius vanderbilt and john d. rockefler and people who vilify them. they did some charity work. they werevil robbers. >> they fundamentally transformed the lives of americans and raising living standards. rockefeller brought us well and made profits. by the way, he probay i also responsible for saving the whales because he pushed down the price of oil it was no longer profitable to how best to extinction henry ford makes jeep automobiles. it does not maer that is motive was profits. he made automobiles affordable for the average middle-class amican. the se is true of most of these so-caed robber barons of the late 19th and early 20th century. john: thank you. up next, if i put on a fake beard and chemistry of people beard and chemistry of people give me mon ♪ grew up in a small town and when the rain would fall down ♪ ♪ i'd just stare out my window ♪ dreaming of what could be and if i'd endp happy ♪ ♪ i would pray i could brkaway ♪ ♪ i'll spread my wings and i'll learn how to fly ♪ i'll do what it takes till i touch the sky ♪ ♪ i gotta make a wish, take a chae, make a chan, and break away ♪ ♪ out of the darkness and into the sun ♪ ♪ i won't forget all the ones that i love ♪ ♪ i gotta take a risk, take a chance, make a ange, and break away ♪ ♪ john: it will come to an end. the sooner the better the billions we spend on foreign aid. much of which is squandered or stolen. i agree with ron paul and his son, the senator. we should stop almost all foreign aid. the one libertarians say th people need angry. >> cut off american assistance to these democratic efforts. pull the eight o. what the heck. less than 1 percent of the entire budget of the united states of america. john: it's pretty close to 1%. $35 million. i say we can't afford that. gregory adams runs of sam's 80 effectively says we should spend more. a giant charity it tries to fight poverty over the world. i say, fine. if you want to do that, you raise the mon he believes government out of it. >> the issue is that there are some things that charities just can't do. despite the impact that they have around the world, and we are proud of the work that we do with money raised from average americans, there is only so much that we can do with our own projects. some places government needs to step in. john: all right. government needs to make sure aids workers and of being murdered on the way to where they're going. and i should say that you don't take government moneyrom the united states. to other countries. but you call for government to spend more on foreign aid. why when so much has been squandered? >> it is important to know that we're calling for more of the right kind of a. john: this is going to be the right kind. >> there are some things that we think the united states government is doing that we think is not a good use of money. particular, food aid is in deerate need of reform. we miss about half of the value of every dollar that we spend because we require it to be shipped in american vessels, delivering food rather than buying food at the source. john: you also wanted to spend more. >> we want more of the right kind. there are good programs, the millennium celebration that invest in success. the best performing countries rather than subsidizing failure. weant to see more aid given directly to helping small farmers grow more of their own food and you want to see more aid used to support the anti-corruption efforts. john: but what are the odds that that will happen? that the aids support the corrupt dictators as much as half the food aid center at the molly is divertedo corrupt ccntractors, is like militants, local un staff. >> somalia is a difficult environment. john: i will go on. zimbabwean authorities confiscated truck filled with american food aid for school kids and handed it out to supporters of president robert mcgowan boy and a political rally. >> this is one of the problems when the only tool youave is bags of food. john: but by calling for more government aid you are calling for more of the aid that despite all the promises of reform has ended up in the hands of corrupt dictators. >> we are nojust calling for more government aid. john: i understand that, and you do some brave work. why do you call for it at all? >> a lot of misconceptions. one of the bgest is that most u.s. assistae actually goes to governments. inact, that is not true. most goes to u.s. based charities, ngos, contractors. john: and the u.n. >> there is portion that goes. we are very clear that they are not the solutn. people on the solution to poverty. john: let's hear from an african entrepreneur. a busins and american. but she tried operating a business in her own company -- countr of senegal. you agree. >> the combination. foreign aid. government. >> i have a very hard time. the african union itself is admitting it is being siphoned through corruption. john: the swiss bank account. >> swiss bank accounts, real estates in the south of france, the son of the dictator of a equatorial guinea. he was busted by french customs. his plan was intercepted, and they found in the plane 27 fancy cars. i don't know how many furry some bentleys, rolls-royces. john: the only w to stop that is said keep government out of it. you can get a bunch o people who wanto give their o money they won't give it to dictators. >> well, not of governments of the same. we actually work with a lot of anti-corruption and human rights activists in countries around the world who are actually working t try to get their governments to govern more accountable. they're intested in u.s. standing with them in joining this fight. too oft we take such an approach to u.s. assistance,e try to make it -- we focus on much and a boarding corruption these activists in telling us that they want to us stand together to fight corruption which means that we need to be their standing with them in solidarity working together. john: why the need government aid? why the need government aid? >> government said the only tool that can work to solve some of these accountability problems. it is like asking why the bears need an offensive line. at some point you need these other tools. it will be entrepreneurs who solv theroblem of african poverty. but you also need government to do other things. john: you need governments. >> unfortunately at least in most countries in africa government has been the problem. they basically say, as an trepreneur government does nothing but slow me down on a regular basis. officials bribing me all along. the fact that my truck is parked on a regular basis. and i have to pay a single time in the delays. john: government aid will help fight the corruption. >> i'm sorry. the more you're feeding this huge government the more you choke me from the other end. that is at least the phenomenon that i am awareness of. and the more you give to them the more that is what happens to me. john: we do think that the is role that government can play. in a lot of the places we actually find there is a government deficit. people have to deal with -- john: why do you believe government aid would provide that? has not so far. >> that is actually not true to a lot of success stories. a lot of african countries that the scene. john: to racine them. thank you. coming up, why our man came up to me on the street and said are you john stossel? i hope you die. see these hands? they gripped the wheel of a humvee in afghanistan. these hands? six years treating soldiers. twelve years, flying choppers. my hands? they're here for the pern who fought in afghanistan. i made the call and got support for my sister. my hands are here for the person who treated those soldiers. i helped connect my son with the care he's earned. mine take care of the person who flew those helicopters. and ifife gets overwhelming they're ready to dial the veterans cris line. the veterans crisis line is re for all veterans and their loved ones. call 1-800-273-8255 and press 1. or chat online at veteranscrisline.net ♪ john: someone once came up to me on the street in new york and said, are you john stossel ha said the spd said to my hope you guys in. so what is this hatred about? it turned out he was what people call and anti-poverty lawyer and did things like sue landlords to stop them from evicting people. in his world here in new york capitalism is the enemy, and the only thing that keeps poor people from being totally impressed his government. so because i call for less government and evil. this town, we libertarians are selfish people. and a good guy is called a bleeding heart liberal so what is this website about? bleeding heart libertarians. talks about social justice and free-market. georgetownwn university philosoy professor regularly contributes to the site. why? >> the idea is to recapture the soul of libertarianism. what they can and should do is embrace the concept of social justice. john: what does the phrase even mean? i am for social justice. >> right. john: for a lot of people it does not mean anything. itust means socialism. there is a real meaning. course of institutions that you expect other people to live by. john: laws, property rights, fami rules come anything like that, one of the tests of those institutions should be that you expect when people live and abide by them attend to produce good consequences for everybody. you can show whether you care about this by asking a questn like this. imagine that marxists were right. imagine there were a disaster, they left the overall majority of people destitute. would you still advocate markets? i think most libertarians would say i would at least have some reservations. the fact that they work matters in the justification. if you think that the new advocate whether you know not what philosophers are lling the social justice. john: i'm rand said that do not nsider charity a major virtue. selfish. >> wt she means is not what most people mean. even if she thinks that i don't think she speaks for most people most are humane, they give to charity, the care that markets work and their work for everybody. the minimum wage, if you did not think that matter why would you argue that because on one. you don't beat you say that the minimum wage causes unemployment among the most laura will people in society and that is part of the reason to oppose it which means that you care of the consequences for theoor. john: the website, bleeding het libertarian, categors like advocating nurses caring versus helping. >> this explains what is going on with people when they think that libertarians are selfish. if you are on the lefty probably believe that your policies are the only sensible expression of benevolence. you probably think they must disagree with your values and only care of their pocketbooks. that is never really make sense because we hav real arguments but also advocacy is cheap. i advocate that we have a 90% marginal tax rate, income over 100,000, if i advocate that it does not cost me anything. if i give money to charity -- john: governments should have a bigger anti-poverty program. >> that costs you nothing but you get the warm glow of altruism when you say you advocate that. put your money where your mouth is. does it actually does something. i know your concern. if you're advating taking income from other people or yourself and that is all you do your not really showing me tt you care. john: it is easy to be generous with other people's money. that is what politicians do. >> that's right. john: thank you. coming up, my take on real charity. ♪ ♪ john: i used to be pretty cheap. my mom told me, if you don't save your money you will freeze in the dark. so i saved. but when my career took off and i started getting paid money to make speeches i decided to donate the money to charity, and it changed my life. i realize that i like giving money away. it makes me happy. research on what makes people happy backs that up. on average people who give to charity, whether they give them money or just time, they are happier. so death. it is did for us and get for them. though that depends whom you give to. i put on a fake beard and tried begging in new york city. people gave me money. they gave me money whe my cardboard sign said thomas and cold, and even gave when i chased it to needed bier. thank you. thank you. john: when they asked givers why they gave people said things like this. >> he looks pretty neat, i suppose. john: i just beg for an hour, but i did well. but did this for an eight hour day and would have made $90 a 23,000 year. tax-free. that is the reason social workers say no to give to beggars. often it is a sm planery often y are an enabling. by giving cash to subsidize the biggest drug or alcohol hit. by not giving you may encourage them to give real help. a few respectable charities illicit on the s streets. but most were begging or running scams. >> i need your help. i am homeless. john: nework attorney general said this pitch from a group calling itself united homeless is a scam. its director keeps nearly all the money comes bins it on things like his weight watcher bills. i hear you keep most of the moy. >> we are meless people. john: the pages it is going to shelters. >> am i supposed to run a nonprofit and not get money? >> all the people donate absolutely kno where the money goes. john: it is hard to find out where your charity money really goes. we can check charity rating services like charity navigator. it is better than nothing. the ratings are not perfect. some charities are not perfect, and rating services sometimes did coned. i give my charity money to groups that i cacheck out myself, a group tha rehabs ex-con and attics. i decided they do a good job because i could see these men. they call them men in blue, ready, willing, able. the clean-air bill york city streets. what is hot is that they do is bring in a step in look cerful and work fast. i thought whoever is working with these guys has done something right, taught them to take pride in work. i give them money in a couple of other groups that back and watch. while give to what i think are good charities, we shoul not forget about the people of, capitalists, on this once. but job creators do much more good for the world that politicians. and more en than that do-gooders' working for charity. i am delighted that the singer bought of figure that out aer spending years calling for government to spend more in foreign-aid flop. now he says the best hope for the four is free markets. >> preaching capital. >> sometimes i hear myself, and i just cannot believe it. commerce is real. just a stopgap. >> commerce and on to panera capitalism takes more people out of poverty. we know that. john: politicians don't know that. many americans don't know it. it is time that they learned. entrepreneurial capitalism takes more people out of poverty and a never well. that is our show. see you next week. ♪ weekend. "the willis report" is coming up next. ♪ gerri: hello, everybody. i'm gerri willis. tonight onthwillis report" consumer relief or blata union to know. watching outor you tonight on "the wlis report". ♪
government you're going to be in for an awful long way. john: if they get it may be seen more people will realize there are better ws to give. real charity. that is our show tonight. ♪ >> and now. ♪ john: what is real charity? people are in troublefter disaster or sply when people are poor. americans instead is to think amount and government help. after all, who will help those people is not government? libertarians argue that private charity would step in. individuals really choosing to help. but with enough of us up? most people say no. that is why liberals like neday columnist say when it comes to helping the need, that is mostly government's job. >> well, listen, it would be great if people of reach into their hearts and solved all these will problems. that does not happen. in almost every single case where they're is a government program that exists because the private efforts. when you have 04 enough. john: that is because politicians sd they were not enough and we could do better. i would argue that a government did not takes a much of our monethe private sector would takeare of these problems. >> hold on a second. let's get older americans. the poorest sector of our society. something called social security camelot. medicare came along. all the peop really do comparatively fairly well. we had hundred kidspread all across america. those numbers were cut dramatically in spite of the generous churches and nice people. >> programs are trillions in debt. unsustainable. >> maybe we have to tweak. but you can't throw away the idea. the reality is we need government then there. john: food stamps, a couple billionaires' could find that all program by themselves. and a pri charity would be better as saying who really needs the food help and to is giving the system >> i would love that. you know a billionaire who wants to pay to my think we would welcome that. john: did not step in because you're a big fat government is there. people say, oh, the government does that. >> here is the reality in real fe. all these private efforts are really important. generous people. we give a lot of money. when the chips are really down and the big thing happens, the typhoon hits the philippines, we love the red cross effort. but they don't have an aircraft carrier with marines on board and rescue helicopters. the u.s. military does. i want them steaming toward the phippines when that's-it's. john: i don't know what will happen. in haiti our government promised billions of dollars, billion of it is not done to the people. the new york times said there were going t build 15,000 alums, latest target fewer than 3,000. >> your argument is that government sometimes does not do a perfect job. i concede that. john: i want to play along perversion of the clip earlier. to my left-wing colleagues were talking about how after a disaster faith based charies work better and disaster relief and fema. >> there is fema and then there is the faith based fema. >> if you're waiting for the government you are going to be in for an awful long wait. >> talking about the government response after the tornado in oklahoma in may. now 30 churches banded together to help much more quickly and did a better job in government. this happened with katrina. fema was turning away walmart. people were tryinto get water. seing its water to the wrong place. >> you're right. as you know, i am a native of new orleans. there are some things that the province to well. all those kids, wonderful young people who came down, church groups, they did something much better than government. but ey were still an awful lot of things that we needed government. remember how angry folks were. no one said stay away. john: walmart and private charities got there. >> maybe one of the things of the privates can do is be more nimble. if you are talking about rebuilding, i don't think you want the government to take a pass. john: i do. let's talk about the war on poverty. lyndonohnson said he would and porty. here is where the war began. and sure enough it dropped sharply the first five, seven years after that. to then it stopped improving. >> we teach people to be dependent. that was happening before the war. americanwere lifting themselves out of poverty. government continuehe progress for five years and then stopped it. >> we should have been more generous, done the other things that government can do to help folks. john: government does not teach a dependency. >> i am not here saying government is profit. government has some bad thing clumsy, bureaucratic. there are things i does really well. hey, private folks, step up. john: these graphs of the test. can we put these up. john: the recession, t it goes up steadily. two lines referred to one is the number of people collecting in the other is the cost. we are teaching people to be passive. >> i will grant you that is something we want to avoid. what is t solution from look at the people and say we will take your food stamps a way? up for the best. >> limit the program some of the private sector stepped in. one more example is the rise of disability test people. straight out. you have fewer people doing manual labor, medicine is better , and more people are disabled. >> i am with you on that one. john: if you want to get rid of it. >> no, i don't want to get rid of it. certainly we can look more closely as of the applications. john: cut it way back. there's a place near college of center, a government office supposedly to help people find jobs. i went there. people said, there are no jobs. we then went around 40 job offers, 28 and to build positions, one restaurant owner said, i would hire a dozen people live there would just apply. >> i would throw we take nine with no experience in trenton. john: and that the welfare of a steeple told us there are no jobs. >> there plenty of jobs. john: government jobs offices to encourag people to take welfare. as somebody go and ask for help to see if it would help her get a job and they said, no, they just to reach for welfare and food stamps. >> again, it is much smarter to have programs that encourage people to work, don't reward laziness,. john: they all do that. >> i don't know. john: private charities and of any suppression did he tell. >> the answer can be to just cut it back a mechani john: get it back. and let the private sector in. we will stop there. thank you. atomize a private charity should replace government. what about the rest of the world? people assume global poverty i a problem. it has to be addressed by government giving out foreign aid or maybe the wind. the u.s. and contradicts the title of my book by saying, yes, we, governments, working together can end poverty in just two years while. two years. of course 50 years ago lyndon johnson claimedis war on poverty would end poverty in america. the u.n. will do better. ted turner gave him a billion dollars for this. individual governments and squandered nearl a trillion dollars of foreign aid trying to lift people out of poverty in africa. i say squandered because after they spent trillions for income per capita it went down. that is maybe because the foreign aid encourages dependency and african kleptocrats government steal much of the money. what is the alternative? michael fay says he has an answer. what is yours? >> we are going straight to the port. cash transfers from you directly to them. no middleman, no leakage, no hidden costs. john: the charity, and you have raised about $6 million. just given 27,000 people-the thousand dollars each. >> that is exactly right. a thousand for the households. john: this sounds like a stupid idea. they will just spend it and then it won't have any. >> you are not the only one. the truth is there has been about a decade of research that shows the exact opposite. what are these people missing? a lot of them are missinghe capital. we have the old expression teach a man to fish. the truth is they don't have fishing poles. john: so you allow them to buy a fishing pole or in this case this may have been a guy who got a motorcycle and use it for a taxi service. >> this is a used motorcycle that he bought with cash and now provides tax to services. john: he gives the people a cell phone with the money. >> thais the way we transfer the money. found the phone. if they don't have a phone them in a deal to get the money. john: and its easier to check up on them. >> we check, call them, talk to them regularly. john: people build metal roofs. the most popular thing. >> no charity. saves income, clean water, was malaria. we did not think of it, they did. john: before they had that they had at that's true fan is bad about a hundred dollars a year. john: instead they can start a business, another person had received training from another charity to be a welder. >> said he was standing there doing nothing. he did not have welding equipment. john: what makes you think this work? >> we have a decade of evidence, we have done our own third-party valuation. we know income goes up a monstrous level goes down, under follows. john: you do another odd thing. none of your charity board members works full-time for your charity. >> her the great thing. if it is not working i would not lead to -- need to lie the right attitude my job. john: you could be more honest evaluating it. theharities delude themselves. >> well, i think people have passion and often implies evidence. john: i have hard time accepting i just criticize government pro grams because they don't teach people to take care of themselves. i guess giving cash once and knowing that it will keep coming is different. >> a onetime transforming event it does not matter who does it. matters what they do. why buy a cow when the person is to will then. john: to take care of it? look to make the choice. john: i hope it works. i'm gla a lot ofhese experiments are going on. thank you. if you would like to keep this conversatn going go to facebook or twitter and use that has tank. real charity. that people know what you think. coming up, president obama's says the way to help poor people is to give the a free cell phone. ♪ ♪ hmm. ♪ mm-hmm. [ engine revs ] ♪ [ male announcer ] oh what fun it is to ride. get the mercedes-benz on your wish list at the winter event going on now -- but hurry, the offer ends soon. [ santa ] ho, ho, ho! [ male announcer ] lease the 2014 glk350 for $419 a month at your local mercedes-benz dealer. ♪ >> the government will pay for you to have a free cell phone with monthly minutes, no credit check and no deposit required. john: of freeell phone. 253 minutes. what the deal. this is to help poor people in need a lifeline. that is reasonable. this is a government program that began with ronald reagan. president obama expanded it, of course. and in just four yrs the costs tripled and will continue rice can. >> a minority. you know. he gave up. , no income, disability. john: the more free stuff you get the more you're eligible to get. but eligible is. what did you do? >> i went to all the welfare offices in manhattan and a couple in brooklyn and found out that there are people of their approach you on the street as the if you have your free phone yet. outside the office. john: private entrepreneur. >> and not on welfare. i told them that. i would like to be buried at think a lot of the people would like to be. but that was enough. they ended up giving me not one, not to, but three free phones. john: the good news is someplace is turned down. >> yeah. they ended up. first of, you are not supposed to have duplicate files which i have already broken and will. there also supposed to check eligibility. they also did not catch the eye and multiple applications and and try to work powero the system again and again. john: and fcc audit, they found 41 percent of the recipients never demonstrated that they were eligible. >> that's about 6 million people. the what you really see is the phone companies have a very perverse incentive to push those bonds and on the street. they get $9.25 per customer per month for this program. the street vendors -- john: is paid for out of your phone bill. if you bothered to read the fine print, the is something called the universal service charge. this was under ronald reagan, make sure everybody and a phone line. universal service. a dollar and two out of every race home built. bison i think that most taxpayers don't know what. i went out and investigated. i didn't know. john: bore people talk to their families. >> the phone companies of the bad guys in this. this is a huge business. the mexican billionaire, one of the richest people in the world. john: he may be the richest. >> csn bill gates compete. but he got in 2011 alone half a billion dollars from this program. so what turned out to be welfare for the poor is actuall corporate welfare plan in simple john: and what about my obnoxious question. you don't want to help the poor? >> well, i think maybehere would be justification for a land line. as with a program started out as, but anytime you have perverse incentives for companies to go and no phones combined with the very poor oversight you have to ask yourself, you creating a situatn in which fraud and abuse can just compound? that is what we have. john: it should not surprise anyone that government charity is susceptible to fraud. the contractors doing the work. no one's money. the more they give out the more ey get to keep. they get a commission on each give away. the cellphone charities $2 billion. think about the hundreds of billions spent on medicare and medicaid. much more from there. people work out with all this stuff. one man alone spent $20 million on this diamond jewelry, also a fleet of luxury cars, one after the other. all of which she got because gornment paid millions for medical treatment that never happened. government health is just era susceptible to abuse. and is definitely what i found. was surprised that i was able to get three of them in violation a pretty muchvery program wall, and if i can do it being someone he tells the truth, just a man from the people. actually willing to abuse the program. john: private companies get ripped off. but they have more of an incentive to check. it's their own money. >> that's right. georgia is actually doing reform within the states to try to see if they can mess with that fundamental flaw in incentive structure. there will start charging $5 for consumers. they have to pay $5 spirit there less likely god and by. john: thank you. coming up, better ways tell people. ♪ ♪ [ chicken caws ] [ male announcer ] when your favorite food starts a fight, fight back fast with tums. eartburn relief that neutralizes acid on contact and goes to work in seconds. ♪ tum, tum tum tum tums! ♪ [ male announcer ] the parking lot helps by letting us know who's coming. the carts keep everyone on the right track. the power tools iroduce themselves. all the bits and bulbs keep themselves stocked. and the doors even handle the checkout so we can work on that thing that's stuck in thing. [ female announcer ] today, cisco is connecting the internet of everything. so everyone goes home happy. ♪ john: one of the richest people in the world is warren buffett. is the jeep? he is one of many billionaire sue until recently gave very little to charity. he used s money to try to make more money. he said he would give it away when he died. his fellow billionaire ted turner told me buffett was being cheap. >> she should give some away now hn: turner just made a big splash by giving a billion dollars to the wind. now he said he wanted to shame other rich people into giving more. >> what he said is bad and the stupid. john: that was his awer. >> what he should do is take his money and invested. he can help people in the other better way into invested and have the companies in building in plans that creating the investment creates jobs and wealth and products for other people. john: really? is it better if a money maker uses money to make more rather than give to charity? i think so. add to that question back to ted turner. >> bill gates says, and get it making money. john: that try to argue this, but he wasn't buying it. john: and i wrong in thinking that i am happy if he gives that the charity? >> when you be happier if he did? you alleges -- this is what people don't like theseen. i know your dirty tricks. there is nothing more say. goodbye. i am walking out. john: he did not want to talk about it. let's take that same question to an economist to rise a free-market institute at texas tech. >> am not bothered if they don't give more of it away. they make their money by making allies that. theyre helping people. often that is the best with a can help. john: and then make a profit than they hire people, those jobs live on for years. people use it to educate there kids and feed their family. there is a multiplier. these guys may not even begin dexterity. we know they're good at making money. stick to wha your specialty is. >> it's about the results. if leeson to do the things that we want them to do. of course the real reason is that creating the products and services that make our lives better, but as byproduct they create jobs that make other people better off. it is what is fundamentally responsible for the high standard of ling we enjoy. john: said most of them, i would say to my don't feel good about all the wealth they create in their business and guiltily give to charity. even bill gates is now working full time on charity he says he thinks most charity has to come from government. >> a lot of the money that is supporting these causes is coming from the private sector, people like you and less from e government. john: governments are the backbone of this. >> no, no, no. he is good as computers, not it is social policy. just last week had a research paper presented about the great chicago fire of 1871. what happened afterward, there was no fema. it was private charity and civil society organizations the banded together and help get people out of the city who lost their homes, brought in new shelter, clothing. judgg fromhat i was hearing from my work to haggle a lot better than fema of ordering people when they can and cannot go and buts in the process to behalf of. john: a recent edition of forbes magazine, the richest people's list featured philanthropy. so how they are now reading billionaires' by how much they give. a kind of want my heart. let's have a competition. >> there is nothing wrong with people giving money to the causes thinker valuable. not every good or service will be produced for profit. some of it can come from this segment of society, and it's fine that we recognize that as long as weon't demonize those who aren't doing it and think there's something wrong with them pursuing profit because there is not. at osmanli makes us bette off john: there are these tycoons from previous years cornelius vanderbilt and john d. rockefeller and people who vilify them. they did some charity work. they were evil robbers. >> they fundamentally transformed the lives of americans and raising living standards. rockefeller brought us well and made profits. byhe way, he probably is also responsible for saving the whal because he pushed down the price of oil it was no longer profitable to how best to extinction henry ford makes jeep automobiles. it does not matter that is motive was profits. he made automobiles affordable for the average middle-class american. the same is true of most of these so-called robber barons of the late 19th and early 20th century. john: thank you. up next, if i put on aake beard and chemistry of people give me mon this is the quicksilver cash back card from capital one. it's not the "fumbling around with rotating categories" card. it's not the etting blindsided by limits" card. it's the no-game-playing, no-earning-limit-having, deep-bomb-throwing, give-me-the-ball-and-i'll-take- it-to-the-house, cash back card. this is the quicksilver cash card from capital one. unlimited 1.5% ch ba on every purchase, everywhere, every single day. so let me ask you... at's in your wallet? 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'cause it gives me a big fat zero heartburn. woo hoo! [ male announcer ] prilosec otc. the number one doctor recommended frequent heartburn medicine for 8 straight years. [ larry ] you can't beat zero heartburn. and best of all, it means i can enjoy all the foods i love. oh, zero heartburn is awesome. just like zero clery. ♪ [ male announcer ] prilosec otc. one pill each morning. 24 hours. zero heartburn. ♪ john: it will come to an end. the sooner the better the billions we spend on foreign aid. much of which is squandered or stolen. i agree wh ron paul and his son, the senat. we should stop almost all foreign aid. the one libertarians say that people need angry. >> cut off american assistance to these democratic efforts. pull the eight out. what the heck. less than 1 percent of the entire budget of the united states of america. john: it's pretty close to 1%. $35 million. i say we can't afford that. gregory ams runs of sam's 80 effectively says we should spend more. a giant charity it tries to fight poverty over the world. i say, fine. if you want to do that, you raise the money he believes government out of it. >> the issue is that there are some things that charities just can't do. despite the impact that they have around the world, and we are proud of the work that we do with money raised from average americans, there is only so much that we can do with our own projects. some places government needs to step in. john: all right. gornment needs to make sure aids workers and of being murdered on the way to where they're going. and i should say that you don't take government money from the united states. to other countries. but you call for government to spend more on foreign aid. why when so much has been squandered? >> it is important to know that we're calling for more of the right kind of a. john: this is going to be the right kind. >> there are some things that we think the united states government is doing that we think is not a good use of money. particular, food aid is in desperate need of reform. we miss about half of the value of every dollar that we spend because we require it to be shipped in american vesls, delivering food rather than buying food at the source. john: you also wanted to spend more. >> we want more of the right kind. there are good programs, the millennium celebration that invest in success. the best performing countries rather than subsidizing failure. we want to see more aid given directly to helping small farmers grow more of their own food and you want to see more aid used to support the anti-corruption efforts. john: but what are the odds that that will happen? that the aids support the corrupt dictators as much as half the food aid center at the molly is diverted to corrupt ccntractors, is like militants, local un staff. >> somalia is a difficult environment. john: i will go on. zimbabwean authorities confiscated truck filled with american food aid for school kids and handed it out to supporters of president robert mcgowan boy and a political rally. >> this is one of the problems when the only tool you have is bags of food. john: but by calling for more government aid you are calling for mor of the aid that despite all the promises of reform has ended up in the hands of corrupt dictators. >> we are not just calling for more government aid. john: i understand that, and you do some brave work. why do you call for it at all? >> a lot of misconceptions. one of the biggest is that most u.s. assistance actually goes to governments. in fact, that is not true. most goes to u.s. based charities, ngos, contractors. john: and the u.n. >> there is portion that goes. we are very clear that they are not the solution. people on the solution to poverty. john: let's hear from an african entrepreneur. a business and american. but she tried operating a business in her own company -- country of senegal. you agree. >> the combination. foreign aid. government. >> i have a very hard time. the african union itself is admitting it is being siphoned through corruption. john: the swiss bank account. >> swiss bank accounts, real estates in the south of france, the son of the dictator of a equatorial guinea. he was busted by french customs. his plan was intercepted, and they found in the plane 27 fancy cars. i don't know how many furry some bentleys, rolls-royces. john: the only way to stop that is said keep government out of it. you can get a bunch of people who want to give their own mey they won't give it to dictators. >> well, not o governments of the same. we actually work with a lot of anti-corruption and human rights activists in countries around the world who are actually working to try to get their governments to govern more accountable. they're interested in u.s. standing with them in joining this fight. too often we take such an approach to u.s. assistance, we try to make it -- we focus on much and a boarding corruption these activists in telling us that they want to us stand togeth to fight corruption which means that we need to be their standing with them i solidarity working together. john: why the need government aid? why the need government aid? >> government said the only tool that can work to solve some of these accouability proems. it is like asking why the bears ed an offensive line. at some int you need these other tools. it will be entrepreneurs who solve the problem of african poverty. but you also need government to do other things. john: you need governments. >> unfortunately at least in most countries in africa government has been the problem. they basically say, as an entrepreneur government does nothing but slow me down on a regular basis officials bribing me all along. the fact that my truck is parked on a regular basis. and i have to p pay a single tie in the delays. john: government aid will help fight the corruption. >> i'm sorry. the more you're feeding this huge government the more you choke me from the oth end. that is at least the phenomenon that i am awareness of. and the more you give to them the more that is what happens to me. john:e do think that there is role that government can py. in a lot of the places we actually find there is a government deficit. people have to deal with -- john: why do you believe government aid would provide that? has not so far. >> that is actually not true to a lot of success stories. a lot of african countries that the scene. john: to racine them. thank you. coming up, why our man came up to me on the street and said are you john stossel? i hope you die. 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(announcer) scottrade-proud to be ranked "best overall client experience." ♪ john: someone once came up to me on the street in new york and said, are you john stossel? has said the spd said to my hope you guys in. so what is this hatred about? it turned out he was what people call and anti-poverty lawyer and did things like sue landlords to stop them from evicting people. in his world here in new york capitalism is the enemy, and the only thing tha keeps poor people from being totally impressed his government. so because i call for less governnt and evil. this town, we libertarians are selfish people. and a good guy is called a bleeding heart liberal. so what is this website about? bleeding heart libertarians. talks about social stice and free-market. georgetown university philosophy professor regularly contributes to the site. why? >> the idea is to recapture the soul of libertarianism. what thecan and should do is embrace the concept of social justice. john: what does the phrase even mean? i am for social justice. >> right. john: for a lot of peoe it does not mean anything. it jt means socialism. there is a real meaning. course of institutions that you expect other people to live by. john: ls, property rights, mily rules come anythg like that, one of the tests of those institutions should be that you expect when people live and abide by them attd to produce good consequences for everybody. you can show whether you care about this by asking a question like this. imagine that marxists were right. imagine there were a disaster, they left the overall majority of people destitute. uld you still advocate markets? i think most libertarians would say i would at least have some reservatio. the fact that they work matters in the justification. if you think that the new advocate whether you know not what philosophers are calling the social justice. john: i'm rand sai that do not consider charity a major virtue. selfish. >> what she means is not what most people mean. even if she thinks that i don't think she speaks fo most people most are humane, they give to charity, the care that markets work and their work for everybody. the mimum wage, if you did not think that matter why would you argue that because on one. you don't beat you say tt the minimum wage causes unemployment among the most laura will people in society and that is part of the reason to oppose it which means that you care of the consequences for the poor. john: the website, bleeding heart libertarian, categories like advocating nurses caring versus helping. >> this explains what igoing on with people when they think that libertarians are selfish. if you are on the lefty probably believe that your policies are the only sensible expression of benevolence. you probably think they must disagree with your valuesnd only care of their pocketbooks. that is never really make sense because we have real arguments but also advocacy is cheap. i advocate that we have a 90% marginal tax rate, income over 100,000, if i advocate that it does not cost me anything. if i give money to charity -- john: governmen should have a bigger anti-poverty program. >> that costs you nothing but you get the warm glow of altruism when you say you advocate that. put your money where your mouth is. does it actually does something. i know your concern. if you're advocating taking income from other people or yourself and that is all you do your not really showing me that you care. john: it is ey to be generous with other people's money. that is what politicians do. >> that's right. john: thank you. coming up, my take on real charity. ♪ ♪ [ engine revs ] ♪ ♪ [ male announcer ] the mercedes-benz winter event is back, with the perfect vehicle that's just right r yo no matter which lt you'ren. 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[ male announcer ] get the all-new 2014 cla250 starting at just $29,900. ♪ john: i used to be pretty cheap. my mom told me, if you don't save your money you will freeze in the dark. so i saved. but when my career took off and i started getting paid money to make speeches i decided to donate the money toharity, and it changed my life. i realize that i like giving money away. it makes me happy. research on what makes people happy backs that up. on average people who give to charity, whether they give them money or just time, they are happier. so death. it is did for us and get for them. though that depends whom you give to. i put on a fake beard and tried begging in new york city. people gave me money. they gave me money when my cardboard sign said thomas and cold, and even gave when i chased it to needed bier. thank you. thank you. hn: when they asked givers why they gave people said things like this. >> he looks pretty neat, i suppose. john: i just beg for an hour, but i did well. but did this for an eight hour day and would have made $90 a 23,000 year. tax-free. that is the reasonocial workers say not to give to beggars. often is a scam plan very often you are an enabling. by giving cash to subsidize the biggest drug or alcohol habit. by not givingou may encourage them to give real help. a few respectable charities illicit on the streets. but mos were begging or running scams. >> i need your help. i am homeless. john: new york attorney general said this pitch from a group calling itself united homeless is a sm. its director keeps nearly all the money comes bins it on things like his weight watcher bills. i hear you keemost of the money. >> we are homeless people. john: the pages it is going to shelters. >> am i supposed to run a nonprofit and not get money? >> all the people donate absolutely know where the money goes. john: it is hard to find out where your charity money rlly goes. we can check charity rating services like charity navigator. it is better than nothing. the ratingsre not perfect. some charities are not perfect, and rating svices sometimes did coned. i give my charity money to groups that i can check out myself, a group that rehabs ex-con and attics. i decided they do a good job because i could see these men. they call them men in blue, ready, willing, able. the clean-air bill york ity streets. what is hot is that they do is bring in a step in look cheerful and work fast. i thought whoever is working with these guys has done something right, taught them to take pride in work. i give them money in a couple of other groups that back and watch. while i give to what i think are good charities, we should not forget about the people of, capitalists, on this once. but job creators do much more good for the world that politicians. and more even than that do-gooders' working for charity. i am delighted that the singer bought of figure that out after spending years calling for government to spend more in foreign-aid flop. now he says the best hope for the four is free markets. >> preaching capital. >> sometimes i hear myself, and i just cannot believe it. commerce is real. just a stopgap. >>ommerce and on to panera capitalism takes more people out poverty. we know that. john: politicians don't know that. many americans don't know it. it is time that they learned. entrepreneurial capitalism takes more people out of povty and a never well. that is our show. see you next week. ♪ adam shapiro. >> this week on "across america" here on the fox business network, why would somebody buy this house for $700,00 and then tear it down? uh-oh, there goes to cmney -- the chimney. oh, dear. while others are making buildings you just can't break down. that's that a 40 caliber shot loo like if you shoot at this thing. then, the business of food. >> the pole try is cage-free. >> you're looking at, actually, dog food. the latest on teardown -- [inaudible] gentrification, the takeover of
government you're going to be in for an awful long way. john: if they get it may be seen more people will realize there are better ways to give. real charity. that is our show tonight. ♪ >> and now. ♪ john:hat is real charity? people are in trouble after a disaster or simply when people are poor. americans instead is to think amount and government help. after all, who will help those people is not government? libertarians argue that private charity would step in. individuals really choosing to help. but with enough of us up? most people say no. that is why liberals like newsday columnist say when it comes to helping the need, that is mostly government's job. >> well, listen, it would be great if people of reach into their hearts and solved all these will problems. that does not happen. in almost every single case where they're is a government program that exists because the private efforts. when you have 04 enough. john: that is because politicians said they were not enough and we could do better. i would argue thaa government did not takes a much of our money the private sector would take care of these problems. >> hold on a second. let's get older americans. the poorest sector of our society. something called social security camelot. medicare came along. all the people really do mparatively fairly well. we had hundred kids spread all across america. those numbers were cut dramatically in spite of the generous churches and nice people. >> programs are trillions in debt. unsustainable. >> maybe we have to tweak. but you can't throw away the idea. the reality is we need government then there. john: food stamps, a couple billionaires' could find that all program by themselves. and a private charity would be better as saying who really needs the food help and to is giving the system. >> i would love that. you know a billionaire who wants to pay to my think we would welcome that. john: did not step in because you're a big fat government is there. people say, oh, the government doeshat. >> here is the reality in real life. all these private efforts are really important. generous people. we give a lot of money. when the chips are really down and the big thing happens, the typhoon hits the philippines, we love the red cross effort. buthey don't have an aircraft carrier with marines on board an rescue helicopters. the u.s. military does. i want them steaming toward the philippines when that's-it's. john: i don't know what will happen. in haiti our government promised billions of dollars, billion of it is not done to the people. the new york times said there were going to build 15,000 alums, latest target fewer than 3,000. >> your argument is that government sometimes does not do a perfect job. i concede that. john: i want to play along perversion of the clip earlier. to my left-wing colleagues were talking about how after a disaster faith based charities work better and disaster relief and fema. >> there is fema and then there is the faith based fema. >> if you're waiting for the government you are going to be in for an awful longait. >> talking about the government response after the tornado in oklahoma in may. now 30 churches banded together to help much more quickly and did a better job in government. this happened with katrina. fema was turning away walmart. people were trying to get water. sending its water to the wrong place. >> you're right. as you know, i am a native of new orleans. there are some things that the province to well. all those kids, wonderful young people who came down, church groups, they did something much better than government. but they were still an awful lot of things that we needed government. rember how angry folks were. no one said stay away. john: walrt and private charies got there. >> maybe one of the things of the privates can do is be more nimble. if you are talking about rebuilding, i don't think you want the government to take a pass. john: i do. let's talk about the war on poverty. lyndon johnson said he would and poverty. here is where the war began. and sure enough it dropped sharply the first five, seven years after that. to then it stopped improving. >> we teach people to be dependent. that was happening before the war. americans were lifting themselves out of poverty. government continue the progress for five years and then stopped it. >>e should have been more generous, done the other things that government can do to help folks. john: government does not tea a dependency. >> i am not here saying government is profit. government has some bad things, clumsy, bureaucratic. there are things it does really well. hey, private folks, step up. john: these graphs of the test. can we put these up. john: the recession, but it goes up steadily. two lines referred to one is the number of people collecting in the other is the cost. we are teaching people to be passive. >> i will grant you that is something we want to avoid. what is the solution from a look at the people and say we will take your food stamps a way? up for the best. >> limit the pgram some of the private sector stepped in. one more example is the rise of disability test people. straight out. you have fewer people doing manual labor, medicine is better , and more people are disabled. >> i am with you on that one. john: if you want to get rid of it. >> no, i don't want to get rid of it. certainly we can look more closely as of the applications. john: cut it way back. there's a place near college of center, a government office supposedly to help people find jobs. i went tre. people said, there are no jobs. we then went around 40 job offers, 28 and to build positions, one restaurant owner said, i would hire a dozen people live there would just apply. >> i would throw we take nine with no experience in trenton. john: and that the welfare of a steeple told us there are no jobs. >> there plenty of jobs. john: government jobs offices to encourage people to take for help to see if it would help her get a job and they said, no, they just to reach for welfare and food stamps. >> again, it is much smarter to have programs that encourage people to work, don't reward laziness. john: they all do that. >> i don't know. john: private charities and of any suppression did he tell. >> the answer can be to just cut it back a mechanic? hn: get it back. and let the private sector in. we will stop there. thank you. atomize a private charity should replace government. what about the rt of the world? people assume global poverty is a problem. it has to be addressed by gornment giving out foreign aid or maybe the wind. the u.s. and contradicts the title of my book by saying, yes, we, governments, working together can end poverty in just two years. while. two years. of course 50 years ago lyndon johnson claimed his war on poverty would end poverty in america. the u.n. will do better. ted turner gave him a billion dollars for this. individual governments and squandered nearly a trillion dollars of foreign aid trying to lift people out of poverty in africa. i say squandered because after they spent trillions for income per capita it went down. that is maybe because the foreign aid encourages dependency and african kleptocratsovernment steal much of the money. what is the alternative? michael fay says he has an answer. what is yours? >> we are going straight to the port. cash transfers from you directly to them. no middleman, no leakage, no hidden costs. john: the charity, and you have raised about $6 million. just given 27,000 people-the thousand dollars each. >> that is exactly right. a thousand for the households. john: this sounds like a stupid idea. they will just spend it and then it won't have any. >> you are not the only one. the truth is there has been about a decade of research that shows the exact opposite. what are these people missing? a lot of them are misng the capital. we have the old expression teach a man to fish. the truth is they don't have fiing poles. john: so you allow them to buy a fishing pole or in this case this may have been a guy who got a motorcycle and use it for a taxi service. >> this is a used motorcycle that he bought with cash and now provides tax to services. john: he gives the people a cell phone with the money. >> that is the way we transfer the money. found the phone. if they don't have a phone them in a deal to get the money. john: and it is easier to check up on them. >> we check, call them, talk to them regularly. john: people build metal roofs. the most popular thing. >> no charity. saves income, clean water, was malaria. we did not think of it, they did. john: before they had that they had at that's true fan is bad out a hundred dollars a year. john: instead they can start a business, another person had received training from another charity to be a welder. >> sd he was standing there doing nothing. he did not have welding equipment. hn: what makes you think this work? >> we have a decade of evidence, we have done our own third-party valuation. we know income goes up a monstrous level goes down, under follows. john: you do another odd thing. none of your charity board members works full-time for your charity. >> here is the great thing. if it is not working i would not lead to -- need to lie the right attitude my job. john: you could be more honest evaluating it. the charities delude themselves. >> well, i think people have passion and often implies evidence. john: i have hard time accepting i just criticize government pro grams because they don't teach people to take care of themselves. i guess giving cash once and knowing that iwill keep coming is different. >> a onetime transforming event it does not matter who does it. matters what they do. why buy a cow when the person is to will then. john: to take care of it? look to make the choice. john: i hope it works. i'm glad a lot of these experints are going on. thank you. if you would like to keep this conversation going go to facebook or twitter and use that s tank. real charity. that people know what you think. coming up, president obama's says the way to help poor people is to give them a free cell phone. ♪ the american dream is of a better future, a confident retirement. those dreams, there's just no way we're going to let them die. ♪ like they helped millions of others. by listening. planning. working one on one. that's what ameriprise financial does. that's what they can do with you. that's how ameriprise puts more within reach. ♪ ♪ >> the government will pay for you to have a free cell phone with monthly minutes, no credit check and no deposit required. john: of free cell phone. 253 minutes. what the deal. this is to help poor people in need a lifeline. that is reasonable. this is a government program that began with ronald reagan. president obama expanded it, of course. and in just four years the costs tripled and will continue rice can. >> a minority. you know. he gave up. , no income, disability. john: the more free stuff you get the more you're eligible to get. but eligible is. wh did you do? >> i went to all the welfare offices in manhattan a a couple in brooklyn and found out that there are people of their approach you on the street as the if you have your free phone yet. outside the office. john: private entrepreneur. >> and not on welfare. i told them that. i would like to be buried at think a lot of the people would like to be. but that was enough. they ended up giving me not one, not to, but three free phones. john: the good news is someplace is turned down. >> yeah. they ended up. first of, you are not supposed to have duplicate files which i have already broken and will. there also supposed to check eligibility. they also did not catch the eye and multiple applications and and try to work power to the system again and again. john: and fcc audit, they found 41 percent of the recipients never demonstrated that they were eligie. >> that's about 6 million people. the what you really see is the phone cpanies have a very perverse incentive to push those bonds and on the street. they get $9.25 per customer per month for this program. the street vendors -- john: is paid for out of your phone bill. if you bothered to read the fine print, there is something called the universal service charge. this was under ronald reagan, make sure everybody and a phone line. universal service. a dollar and two out of every race home built. bison i think that most taxpayers don't know what. i went out and investigated. i didn know. john: bore people talk to their families. >> the phone companies of the bad guys in this. this is a huge business. the mexican billionaire, one of the richest people in the world. john: he may be the richest. >> csn bill gates compete. but he got in 2011 alone half a billion dollars from this program. so what turned out to be welfare for the poor is actually corpote welfare plan in simple john: and what about my obnoxious question. you don't want to help the poor? >> well, i think maybe there would be justification for a land line. as with a program started out as, but anytime you have perverse incentives for companies to go and no phones combined with the very poor oversight you have to ask yourself, you creating a situation in which fraud and abuse can just compound? that is what we have. john: it should not surprise anyone that government charity is susceptible to fraud. the contractors doing the work. no one's money. the more they give out the more they get to keep. they get a commission on each give away. the cellphone charities, $2 billion. think about the hundreds of billions spent on medicare and medicaid. much more from there. people work out with all this stuff. one man alone spent$20 million on this diamond jewelry, also a fleet of luxury cars, one after the other. all of which she got because government paid millions for medical treatment that never happened. government health is just extra susceptible to abuse. >> and is definitely what i found. was surprised that i was able to get three of them in violation a pretty much every program wall, and if i can do it being someone he tells the truth, just a man from the people. actually willing to abuse the program. john: private companies get ripped off. but they have more of an incentive to check. it's their own money. >> that's right. georgia is actually doing reform within the states to try to see if they can mess with that fundamental flaw in incentive structure. there will start charging $5 for consumers. they have to pay $5 spirit there less likely to god and by. john: thank you. coming up, better ways tell people. ♪ this is the quicksilver cash back card from capital one. it's not the "fumbling around with rotating categories" card. it's not the etting blindsided by limits" card. it's the no-game-playing, no-earning-limit-having, deep-bomb-throwing, give-me-the-ball-and-i'll-take it-to-the-house, cash back card. this is the quicksilver cash card from capital 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[ applause ] biotene -- for people who suffer from dry mouth. ♪ john: one of the richest people in the world is warren buffett. is the jeep? he is one of many billionaire sue until recently gave very little to charity. he used his money to try to make more money. he said he would give it away when he died. his fellow billionaire ted turner told me buffett was being cheap. >> she should give some away now john: turner just made a big splash by giving a billion dollars to the wind. now he said he wanted to shame other rich people into giving more. >> what he said is bad and the stupid. john: that was his answer. >> what he should do is take his money and invested. he can help people in the other better way into invested and have the companies in building in plans that creating the investment creates jobs and wealth and products for other people. john: really? is it better if a money maker uses money to make more rather than give to charity? i think so. add to that question back to ted turner. >> bill gates says, and get it making money. john: that try to argue this, but he wasn't buying it. john: and i wrong in thinking that i am happy if he gives that the charity? >> when you be happier if he did? you alleges -- this is what people don't like these men. i know your dirty tricks. there is nothing more say. goodbye. i am walking out. john: he did not want to talk about it. let's take that same question to an economist to rise a free-market institute at texas tech. >> i am not bothered if they don't give more of it away. they make their money by making allies that. they are helping people. often thats the best with a can help. john: and then make a profit than they hire people, those jobs live on for years. people use it to educate there kids and feed their family. there is a multiplier. these guys may not even begin dextery. we know they're good at making money. stick to what your specialty is. >> it's about the results. if leeson to do the things that we want them to do. of course the real reason is that creating the products and services that make our lives better, b as a byproduct they create jobs that make other people better off. it is what is fundamentally responsible for the high standard of living we enjoy. john: said most of them, i would say to my don't feel good about all the wealth they create in their business and guiltily give to charity. even bill gates is now working full time on charity he says he thinks most charity has to come from government. >> a lot of the money that is supporting these causes is coming from the private sector, people like you and less from the government. john: governments are the backbone of this. >> no, no, no. he is good asomputers, not it is social policy. just last week had a research paper presented about the great chicago fire of 1871. what happened afterward, there was no fema. it was private charity and civil society organizations the banded together and help get people out of the city who lost their homes, brought in new shelter, clothing. judging from what i was hearing from my work to haggle a lot better than fa of ordering pele when they can and cannot go and buts in the process to behalf of. john: a recent edition of forbes magazine, the richest people's list featured philanthropy. so how they are now reading billionaires' by how much they give. a kind of want my heart. let's have a competition. >> there is nothing wrong with people giving money to the causes a thinker valuable. not every good or service will be produced for profit. some of it can come from this segment of society, and it's fine that we recognize that as long as we don't demonize those who aren't doing it and think there's something wrong with them pursuing profit because there is not. that osmanli makes us better off john: there are these tycoons from previous years cornelius vanderlt and john d. rockefeller and people who vilify them. they did some charity work. they were evil robbers. >> they fundamentally transformed the lives of americans and raising living standards. rockefeller brought us well and made profits. by the way, he probably is also responsible for saving the whales because he pushed down the price of oil it was no longer profitable to how best to extinction henry ford makes jeep automobiles. it does not matter that is motive was profits. he made automobiles affordable for the average middle-class american. the same is true of most of these so-called robber barons of th late 19th and early 20th century. john: thank you. up next, if i put on a fake beard and chemistry of people give me mon [ male announcer ] this store knows how to handle a saturday crowd. ♪ [ male announcer ] the parking lot helps by letting us know who's coming. the carts keep everyone on the right track. the power tools iroduce themselves. all the bits and bulbs keep themselves stocked. and the doors even handle the checkout so we can work on that thing that's stuck in the thing. [ female announcer ] today, cisco is connecting the internet of everything. so everyone goes home happy. hmm. ♪ mm-hmm. [ engine revs ] ♪ [ male announcer ] oh what fun it is to ride. get the mercedebenz on your wish list at the winter event going on now -- but hurry, the offer ends soon. [ santa ] ho, ho, ho! [ male announcer ] lease the 2014 glk350 for $419 a month at your local mercedes-benz dealer. [ male announcer ] when you wear dentures you may not know it, but your mouth is under attack. food particles infiltrate and bacteria proliferate. ♪ protect your mouth, with fixodent. the adhesive helps create a food seal defense for a clean mouth and kills bacteria for fresh breath. ♪ fixodent, and forget it. ♪ john: it will come to an end. the sooner the better the billions we spend on foreign aid. mu of which is squandered or stolen. i agree with ron paul and his son, the senator. we should stop almost all foreign aid. the one libertarians say that people need angry. >> cut off american assistance to these democratic efforts. pull the eight out. what the heck. less than 1 percent of the entire budget of the united states of america. john: it's pretty close to 1%. $35 million. i say we can't afford that. gregory adams runs of sam's 80 effectively says we should spend more. a giant charity it tries to fight poverty over the world. i say, fine. if you want to do that, you raise the money he believes government out of it. >> the issue is that there are some things that charities just can't do. despite the impact that they have around the world, and we are proud of the work that we do with money raised from average americans, there is only so much that we can do with our own projects. some places government needs to step in. john: all right. government needs to make sure aids workers and of being murdered on the way to where they're going. and i should say that you don't take government money from the united states. to other countries. but you call for government to spend more on foreign aid. why when so much has been squandered? >> it is important to know that we're calling for more of the right kind of a. john: this is going to be the right kind. >> there are some things that we think the united states government is doing that we think is not a good use of money. particular, food aid is in desperate need of reform. we miss about half of the value of every dollar that we spend because we require it to be shipped in american vessels, delivering food rather than buying food at the source. john: you also wanted to spend more. >> we want more of the right kind. there are good programs the millennium celration that invest in success. the best performing countries rather than subsidizing failure. we want to see more aid given directly to helping small farmers gr more of their own food and you want to see more aid used to support the anti-corruption efforts. john: but what are the odds that that will happen? that the aids support the corrupt dictators as muchs half the food aid center at the molly is diverted to corupt ccntractors, is like militants, local un staff. >> somalia is difficult environment. john i will go on. zimbabwean authorities confiscated truck filled with american food aid for school kids and handed it out to supporters of president robert mcgowan boy and a political rally. >> this is one of the problems when the only tool you have is bags of food. john: but by calling for more government aid you are calling for more of the aid that despite all the promises of reform has ended up in the hands of corrupt dictators. >> we are not just calling for more government aid. john: i understand that, and you do some brave work. why do you call for it at all? >> a lot of misconceptions. one of the biggest is that most u.s. assistance actually goes to governments. in fact, that is not true. most goes to u.s. based charities, ngos, contractors. john: and the u.n. >> there is rtion that goes. we are very clear that they are not the solution. people on the solution to poverty. john: let's hear from an african entrepreneur. a business and american. but she tried operating a business in her own company -- country of senegal. you agree. >> the combination. foreign aid. government. >> i have a very hard time. the african union itself is admitting it is being siphoned through corruption. john: the swiss bank account. >> swiss ban accounts, real estates in the south of france, the son of the dictator of a equatorial guinea. he was busted by french customs. his plan was intercepted, and they found in the plane 27 fancy cars. i don't know how many furry some bentleys, rolls-royces. john: the only way to stop that is said keep government out of it. you can get a bunch of people who want to give their own money they won't give it to dictators. >> well, not of governments of the same. we actually work with a lot of anti-corruption and human rights activists in countries around the world who are actually working to try to get their governments to govern more accountable. they're interested in u.s. standing with them in joining this fight. too often we take such an approach to u.s. assistance, we try to make it -- weocus on much and a boarding corruption these activists in telling us that they want to us stand together to fight corruption which means that we need to be their standing with them in solidarity working together. john: why the need government aid? why the need government aid? >> government said the only tool that can work to solve some of these accountability problems. it is like asking why the bears need an offensive line. at some point you need these other tools. it will be entrepreneurs who solve the problem of african poverty. but you also need government to do other things. john: you need governments. >> unfortunately at least in mostountries in africa government has been the problem. they basically say, as an entrepreneur government does nothing but slow me down on a regular basis. officials bribing me all along. the fact that my truck is parked on a regular basis. and i have to pay a single time in the delays. john: government aid will help fight the corruption. >> i'm sorry. the more you're feeding this huge government the more you choke me from the other end. that is at least the phenomenon that i am awareness of. and the more you give to them the more that is what happens to me. john: we do think that there is role that government can play. in a lot of the places we actually find there is a government deficit. people have to deal with -- john: why do you believe government aid would provide that? has not so far. >> that is actually not true to a lot of success stories. a lot of african countries that the scene. john: to racine them. thank you. coming up, why our man came up to me on the street and said are you john stossel? i hope you die. you really love, what would you do?" ♪ [ woman ] i'd be a writer. [ man ] i'd be a baker. [ woman ] i wanna be a pie maker. [ n ] i wanna be a pilot. [ woman ] i'd be an architect. what if i told you someone could pay you and what if tt person were you? ♪ when you think about it, isn't that what retirement should be, paying ourselves to do what we love? ♪ ♪ john: someone once came up to me on the street in new york and said, are you john stossel? has said the spd said to my hope you guys in. so what is this hatred about? it turned out he was what people call andnti-poverty lawyer and did things like sue landlords to stop them from evicting people. in his world here in new york capitalism is the enemy, and the only thing that keeps poor people from being totally impressed his government. so because i call for less government and evil. this town, we libertarians are selfish people. and a good guy is called a bleeding heart liberal. so what is this website about? bleeding heart libertarians. talks about social justice and free-market. georgetown university philophy professor regularly contributes to the site. why? >> the idea is to recapture the soul of libertarianism. what they can and should do is embrace the conceptf social justice. john: what does the phrase even mean? i am for social justice. >> right. john: for a lot of people it does not mean anything. it just means socialism. there is a real meaning. course of institutions that you expect other people to live by. john: laws, property rights, family rules come anything like that, one of the tests of tho institutions should be that you expect when people live and abide by them attend to produce good consequences for everybody. you can show whether you care about this by asking a question like this. imagine that marxists were right. imagine there were a disaster, they left the overall majority of people destitute. would you still advocate markets? i think most libertarians would say i would at least have some reservations. the fact that they work matters in the justification. if you think that the new advocate whether you know not whathilosophers are calling the social justice. john: i'm rand said that do not consider charity a major virtue. selfish. >> what she means is not what most people mean. even if she thinks that i don't think she saks for most people most are humane, they give to charity, the care that markets work and their work for everybody. the minimum wage, if you did not think that matter why would you argue that because on one. you don't beat you say that the minimum wage causes unemployment among the most laura will people in society and that is part of the reason to oppose it which means that you care of the consequences for the poor. john: the website, bleeding heart libertarian, categories like advocating nurses caring versus helping. >> this explains what is going on with people when they think that libertarians are selfish. if you are on the lefty probably believe that your policies are the only sensible expression of benevolence. you probably think they must disagree with your values and only care of their pocketbooks. that is never really make sense because we have rl arguments but also advocacy is cheap. i advocate that we have a 90% marginal tax rate, income over 100,000, if i advocate that it does not cost me anything. if i give money to charity -- john: governments should have a bigger anti-poverty program. >> that costyou nothing but you get the warm glow of altruism when you say you advocate that. put your money where your mouth is. does it actually does something. i know your concern. if you're advocating taking income from other people or yourself and that is all you do your not realllly showing me tht you care. john: it is easy to be generous with other people's money. that is what politicians do. >> that's right. john: thank you. coming up, my take on real charity. ♪ thrusters at 30%! i can't get her to warp. losing thrusters. i need more power. give me more power! [ mainframe ] located. ge deep-sea fuel techlogy. a 50,000-pound, ingeniously wired machine that optimizes raw data to help safely discover and maximize resources in extreme conditions. our current situation seems rather extreme. why can't we maximize our... ready. ♪ brilliant. let's get out of here. warp speed. ♪ yep. got all the cozies. [ grandma ] with n fedex one rate, i could ll a box and ship it r one flat rate. so i kn untilt was full. you'd be crazy not to. is tt nana? [ male announcer ] fedex one rate. simple, flat rate shipping with the reliability of fedex. ♪ john: i used to be pretty cheap. my mom told me, if you don't save your money you will freeze in the dark. so i saved. but when my career took off and i started getting paid money to make speeches i decided to donate the money to charity, and it changed my life. i realize that i like giving money away. it makes me happy. research on what makes people happy backs that up. on average people who give to charity, whether they give them money or just time, they are happier. so death. it is did for us and get for them. thou that depends whom you give to. i put on a fake beard and tried begging in new york city. people gave me money. they gave me money when my cardboard sign said thomas and cold, and even gave when i chased it to needed bier. thank you. thank you john: when they asked givers why they gave people said things like this. >> he looks pretty neat, i suppose. john: i just beg for an hour, but i did well. but did this for an eight hour day and would have made $90 a 23,000 year. tax-free. that is the reason social workers say not to give to beggars. often it is a scam plan very often you are an enabling. by giving cash to subsidize the biggest drug or alcohol habit. by not giving you may encourage them to give real help. a few respectable charities illicit on the streets. but most were begging or running scams. >> i need your help. i am homeless. john: new york attorney general said this pitch from a group calling itself united homeless is a scam. its director keeps nearly all the money comes bins it on things like his weight watcher bills. i hear you keep most of the money. >> we are homeless people. john: the pages it is going to shelters. >> am i supposed to run a nonprofit and not get money? >> all the peopl donate absolutely know where the money goes. john: it is hard to find out where your charity money really goes. we can check charity rating services like charity navigator. it is better than nothing. the ratings are not perfect. some charities are not perfect, and rating services sometimes did coned. i give my charity money to groups that i can check out myself, a group that rehabs ex-con and attics. i decided they do a good job because i could see these men. they call them men in blue, ready, willing, able. the clean-air bill york cy streets. what is hot is that they do is bring in a step in look cheerful and work fast. i thought whoever is working with these gs has done something right, taught them to take pride in work. i give them money in a couple of other groups that back and watch. while i give to what i think are good charities, we shouldot forget about the people of, capitalists, on this once. but job creators do much me good for the world that politicians. and more even than that do-gooders' working for charity. i am delighted that the singer bought of figure that out after spending years calling for government to spend more in foreign-aid flop. now he says the best hope for the four is free markets. >> preaching capital. >> sometimes i hear myself, and i just cannot believe it. commerce is real. just a stopgap. >> commerce and on to panera capitalism takes more people out of poverty. we know that. john: politicians don'tnow that. many americans don't know it. it is time that they learned. entrepreneurial capitalism takes more people out of poverty and a never well. that is our show. see you next week. ♪ weekend. "the willis report" is coming up next. ♪ gerri: hello, everybody. i'm gerri willis. tonight on "the willis report" consumer relief or blatant union to know. watching out for you tonight on "the willis report". ♪
>> if you're waiting for the vernment you're going to be in for an awful long way. john: if they get it may be seen more people will realize there are better ways to give. real charity. that i john: real charity. that is our show tonight >> and now. ♪ john: what is real charity? people are in trouble after a disaster or simply when people are poor. americans instead is to think amount and government help. after all, who will help those people is not government? libertarians argue tha private charity would step in. individuals really choosing to help. but with enough of us up? most people say no. that is why liberals lik newsday columnist say when it comes to helping the need, that is mostly government's job. >> well, listen, it would be great if people of reach into their hearts and solved all these will problems. that does not happen. in almost every single case where they're is a government program that exists becaus the private efforts. when you have 04 enough. john: that is because polticians said they were n enough and we could do better. i would argue that a government did not tak a much of our money the private sector would take care of these problems. >> hold on a second. let's get older americans. the poorest sector of our society. something called social security camelot. medicare came along. all the people rlly do comparatively irly well. we had hundred kids spread all across america. those numbers were cut dramatically in spite of the generous churches and nice people. >> programs are trillions in bt. unsustainable. >> maybe we have to tweak. but you can't throw away the idea. the reality is we need government then there. john: food stamps, a couple billionaires' could find that all program by themselve. and a private charity would be better as saying who really needs the food help and to is giving the system. >> i would love that. you know a billionaire who wants to pay to my think we would welcome that. john: did not step in because you're a big fat government is there. people say, oh, the government does that. >> here is the reality in real life. all these private efforts are really important. generous people. we give a lot of money. when the chips are really down and the big thing happens, the typhoon hits the philippines, we love the red cross effort. but they don't have an aircraft carrier with marines on board and rescue helicopters. the u.s. mitary does. i want them steaming toward the philippines when that's-it's. john: i don't know what will happen. in haiti our government promised billions of dollars, billion of it is not done to the people. the new york times said there were going to build 15,000 alums,atest target fewer than 3,000. >> your argument is that government sometimes does not do a perfect job. i concede that. john: i want to play along perversion of the clip earlier. to my left-wing colleagues were talking about how after a disaster faith based charities wo better and disaster relief and fema. >> there is fema and then there is the fai based fem. >> if you're waiting for the government you are going to be in for an awful long wait. >> talking about the government response after the tornado in oklahoma in may. now 30 churches banded together toelp much more quickly and did a better job in government. this happened with katna. fema was turning away walmart. people were trying to get water. sending its water to the wrong place. >> you're righ as you know, i am a native of new orleans. there are some things that the province to wl. all those kids, wonderful young people who came down, church groups, they did something much better than government. but they were still an awful lot of things that we needed government. remember how angry folks were. no one said stay away. john: walmart and private charities got there. >> maybe one of the things of the privates can do is be re nimble. if you are talking about rebuilding, i don't think you want the government to take a pass. john: i do. let's talk about the war on poverty. lyndon johnson said he would and poverty. here is where the war began. and sure enough it dropped sharply the first five, seven years after that. to then it stopped improving. >> we teach people to be dependen that was happening before the war. americans were lifting themselves out of poverty. government continue the progress for five years and then stopped it. we should have been more generous, done the other things that government can do to help folks. john: government does not teach a dependency. >> i am not here saying government is profit. government has some bad things, clumsy, bureaucratic. there are things it does really well. hey, priva folks, step up. john: these graphs of the tes can we put these up. john: the recession, but it goes up steadily. two lines referred to one is the number of people collecting in the other is the cost. we are teaching people to be passiv. >> i will grant you that is something we want to avoid. what is the solution from a look at the people and say we will take your food stamps a way? up for the best. >> limit the program some of the private sector stepped in. one more example is the rise of disability test people. straight out. you have fewer people doing manual labor, medicine is better , and more people are disabled. >> i am with you on that one. john: if you want to get rid of it. >> no, i don't want to get rid of it. certainly wean look more closely as of the applications. john: cut it way back. there's a place near college of center, a government office supposedly to help people find jobs. i went there. pele said, there are no jobs. we then went around 40 job offers, 28 and to build positions, one restaurant owner said, i would hire a dozen people live there would just apply. >> i would throw we take nine with no experience in trenton. john: and that the welfare of a steeple told us there are no jobs. >> there plenty of jobs. john: government jobs offices to encourage peopleo take welfare. as somebody go and ask for help to see if it would help her get a job and they said, no, they just to reach for welfare and food stamps. >> again, it is much smarter to have programs that encouge people to work, don't reward laziness,. john: they all do that. >> i don't know. john: private charities and of any suppression dihe tell. >> the answer can be to just cut it back a mechanic? john: get it back. and let the private sector in.. we will stop there. thank you. atomize a private charity should replace government. what about the rest of the world? people assume global poverty is a problem it has to be addressed by government giving out foreign aid or maybe the wind. the u.s. and contradicts the title of my book by saying, yes, we, governments, working together can end poverty in just two years. while. two years. of course 50 years ago lyndon johnson claimed his war on poverty would end poverty in america. the n. will do better. ted turner gave him a billion dollars for this. individual governments and squandered nearly a trillion dollars of foreign aid trying to lift people out of poverty in africa. i say squandered because after they spent trillions for income per capita it went down. that is maybeecause the foreign aid encourages dependency and african kleptocratsovernment steal much of the money. what is the alternative? michael fay says he has an answer. what is yours? >> we are going straight to the port. cash transfers from you directly to them. no middleman, no leakage, no hidden costs. john: the charity, a you have raised aout $6 million. just given 27,000 people-the thousand dollars each. >> that is exactly right. thousand for the households. john: this sounds like a stupid idea. they will just spend it and then it won't have any. >> you are not the only one. the truth is there has been about a decade of research that shows the exact opposite. whatre these people missing? a lot of them are missing the capital. we have the old expression teach a man to fish. the truth is they don't have fishing poles. john: so you allow them to buy a fishing pole or in this case this may have been a guy who got a motorcycle and use it for a taxi service. >> this is a used motorcycle that he bought with cash and now providesax to services. john: he gives the people a cell phone with the money. >> that is the way we transfer the money. found the phone. if they don't have a phone them in a deal to get the money. john: and it is easier to check up on them. >> we check, call them, talk to them regularly. john: peoplple build metal roof. the mostopular thing. >> no charity. saves income, clean water, was malaria. we did not think of it, they did. john: before they had that they had at that's true fan is bad about a hundred dollars a year. john: instead they can start a business, another person had received training fm another charity to be a welder. >> said he was standing there doing nothing. he did not have welding equipment. john: what makes you think this work? >> we have a decade of evidence, we have done our own third-party valuation. we know income goes up a monstrous level goes down, under follows. john: you do another odd thing. none of your charity board members works full-time for your charity. >> here is the great thing if it is not working i would not lead to -- need to lie the right attitude my job. john: you could be more honest evaluating it. the charities delude themselves. >> well, i think people have passion and often implies evidence. john: i he hard time accepting i just criticize government pro grams because they don't teach people to take care of themselves. i guess giving cash once and knowing that it will keep coming is different. >> a onetime transforming event it does not matter who does it. matters what they do. why buy a cow when the person is to will then. john: to take care of it? look to make the choice. john: i hope it works. i'm glad a lot of these experiments are going on. thank you. if you would like to keep this conversation going go to facebook or twier and use that has tank. real charity. that people know what you think. coming up, president obama's says the wayo help poor people is to give them a free cell phone. ♪ [ female announcer ] what if the next big thing, isn't a thing at all? it's lots of things. all waking up. connecting to the global phenomenon we call the internet of everything. ♪ it'going to be amazing. and exciting. and maybe, most remarkably, not that far away. e're going to wake the world up. and watch, with eyes wide, as it gets to work. cisco. tomorrow starts here. 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[ male announcer ] get the all-new 2014 cla250 starting at just $29,900. ♪ >> the government will pay for you to have a free cell phone with monthly minutes, no credit check and no deposit required. john: of free cell phone. 253 minutes. what the deal. this is to help poor people in need a lifeline. that is reasonable. this is a government program that began with ronald reagan. president obama expanded it, of course. and inust four years the costs tripled and will continue rice can. >> a minority. you know. he gave up. , no income, disability. john: the more free stuff you get the more you're eligible to get. but eligible is. what did you do? >> i wento all the welfare offices in manhattan and a couple in brooklyn and found out that there are people of their apoach you on the street as the if you have your free phone yet. outside the office. john: private entrepreneur. >> and not on welfare. i told hem that. i would like to be buried at think a lot of the people would like to be. but that was enough. they ended up giving me not one, not to, but three free phones. john: the good news is someplace is turned down. >> yeah. they ended up. first of, you are not supposed to have duplicate files which i have already broken and will. there also supposed to check eligibility. they also did not catch the eye and multiple applications and and try to work power to the system again and again. john: and fcc audit, they found 41 percent of the recipients never demonstrated that they were eligible. >> that's about 6 million people. the what you really see is the phone companies have a very perverse incentive to push those bonds and on thetreet. they get $9.25 per customer per month for this program. the street vendors -- john: is paid for out of your phone bill. if you bothered to read the fine print, there is something called the universal service charge. this was under ronald reagan, make sure everybody and a phone line. unersal service. a dollar and two out of every race home built. bison i think that most taxpayers don't know what. i went out and investigated. i didn't know. john: bore people talk to thei families. >> the phone companies of the bad guys in this. this is a huge business. the mexican billionaire, one of the richest people in the world. john: he may be the richest. >> csn bill gates compete. but he got in 2011 alone half a billion dollars from this program. so what turned out to be welfare for the poor is actually corporate welfare plan in simple john: and what about my obnoxious question. you don't want to help the poor? >> well, i think maybe there would be justification for a land line. as with a program started o as, but anytime you have perverse incentives for companies to go and no phones combined with the very poor oversight you have to ask yourself, you creating a situation in which fraud and abuse can just compound? that is what we have. john: it should not surprise anyone that government charity is susceptible to fraud. the contractors doing the work. no one's money. the more they give out the more they get to keep. they get a commission on each give away. the cellphone charities, billion. think about the hundreds of billions spent on medicare and medicaid. much more from there. people work out with all this stuff. one man alone spent $20 million on this diamond jewelry, also a fleet of luxury cars, one after the other. all of which she got because government paid millions for medical treatment that never happened. government health is just extra susceptible to abuse. >> and is definitely what i found. was surprised that i was able to get three of them in violation a pretty much every program wall, and if i can do it being someone he tells the truth, just a man from the people. actually wling to abuse the program. john: private companies get ripped off. but they have more of an incentive to check. it's their own money. >> that's right. georgia is actually dng reform within the states to try to see if they can mess with that fundamental flaw in incentive structure. there will start charging $5 for consumers. they have to pay $5 spirit there less likely to god and by. john: thank you. coming up, better ways tell people. ♪ this is the quicksilver cash back card from capil one. it's not the "limit the cash i earnvery month" card. it's not the "i only earn decent rewards at the gas station" card. it's the no-games, no-signing up, everyday-rewarding, kung-fu-fighting, silver-lightning-in-a-bottle, bringing-home-the-bacon cash back card. this is the quicksilver card from capital one. she ñ@ç@çpçpçpç÷ñoxmhmhyhyhyh ♪ john: one of the richest people in the world is warren buffett. is the jeep? he is one of many billionaire sue until recently gave very little to charity. he used s money to try to make more money. he sd he would give it away when he died. his fellow billionaire ted turner told me buffett was being cheap. >> she shod give some away now john: tner just made a big splash by giving a billion dollars to the wind. now he said he wanted to shame othe rich people into giving more. >> what he said is bad and the stupid. john: that was his answer. >> what he should do is take his money and invested. he can help people in the other better way into invested and ve the companies in building in plans thatt creating the investment creates jobs and wealth and products for other people. john: really? is it better if a money maker uses money to make more rather than give to charity? i think so. add to that question back to ted turner. >> bill gates says, and get it making money. john: that t to argue this, but he wasn't buying it. john: and i wrong in thinking that i am happy if he gives that the charity? >> when you be happier if he did? you alleges -- this is what people don't like these men. i know your dirty tricks. there is nothing more say. goodbye. i am walking out. john: he did not want to talk about it. let's take that same question to an economist to rise a free-market institute at texas tech. >> i am not bothered if they don't give more of it away. they make their money by making allies that. they are helping people. often that is the best with a can help. john: and then make a profit than they hire people, those jobs live on for years. people use it to educate there kids and feed their family. there is a multiplier. these guys may not even begin dexterity. we know they're good at making money. stick to what your specialty is. >> it's about the results. if leeson to do the things that we want them to do. of course the real reason is th creating the products and services that makeur lives better, but as a byproduct they create jobs that make oth pele better off. it is what is fundamentally responsie for the high standard of living we enjoy. john: said most of them, would say to my don't feel good about all the wealth they create in their business and guiltily give to charity. even bill gates is now working full time on charity he says he thinks most charity has to come from government. >> a lot of the money that is supporting these causes is coming from the private sector, people like you and less from the government. john: governments are the backbone of this. no, no, no. he is good as computers, not it is social policy. just last week had a research paper presented about the great chicago fire of 1871. what happened afterward, there was no fema. it was private charity and civil society organizations theanded together and help get people out of the city who lost their homes, brought in new shelter, clothing. judging from what i was hearing fr my work to haggle a lot better than fema of ordering people when they can and cannot go and buts in the process to behalf of. john: a recent edition of forbes magazi, the richest people's list featured philanthropy. so how they are now reading billionaires' by how much they give. a kind of want my heart. let's have a competition. >> there is nothing wrong with people giving money to the causes a thinker valuable. not every good or service will be produced for profit. some of it can come from this segment of society, and it's fine that we recognize that as long as we don't demonize those who aren't doing it and think there's something wrong with them pursuing profit because there is not. that osmanli makes us better o john: there are these tycoons from previous years corneus vanderbilt and john d. rockefeller and people who vilify them. they did some charity work. they were evil robbers. >> they fundamentally transformed the lives of americansnd raising living stanrds. rockefeller brought us well and made profits. by the way, he probably is also responsible for saving the whales because he pushed down the price of oil it was no longer profitable to how best to extinction henry ford makes jeep automobiles. it does not matter that is motive was profits. he made automobiles affordable for the average middlclass american. the same is true of most of ese so-called robber barons of the late 19th and early 20th century. john: thank you. up next, if i put on a fake beard and chemistry of people beard and chemistry of people give me mon ju by talking to a helmet. it grabbed the patient's record before we even cked himp. it found out the doctor we needed was at st. anne's wiggle your toes. [ driver ] and it got his okay on treatme from miles away. it even pulled strings with the stoplights. my ambulance talks with smoke alarms and pilots and adums. but, of course, 's a good listener too. [ female announcer ] today cisco is connecting the internet of everything. so everything works like never before. ♪ john: it will come to an end. the sooner the better the billions we spend on foreign aid. much of which is squandered or stolen. i agree with ron paul and his son, the senator. we should stop almost all foreign aid. the one libertarians say that people need angry. >> cut off american assistance to these democratic efforts. pull the eight out. what the heck. less than 1 percent of the entire budget of the united states of america. john: it's pretty close to 1%. $35 million. i say we can't afford that. gregory adams runs of sam's 80 effectively says we should spend more. a giant charity it tries to fight poverty over the world. i say, fine. if you want to do that, you raise the money he believes government out of it. >> the issue is that there are some things that charities just can't do. despite the impact that they have around the world, and we are proud of the work that w do with money raised from average americans, there is only so much that we can do with our own projects. some places government needs to step in. jo: all right. government needs to make sure aids workers and of being murdered on the way to where they're going. and i should say that you don't take government money from the united states. to other countries. but you call for government to spend more on foreign aid. why when so much has been squandered? >> it is important to know that we're calling for more of the right kind of a. john: this is going to be the right kind. >> there are some tngs that we think the united states government is doing that we think is not a good use of money. particular, food aid is in desperate need of reform. we miss about half of the value of every dollar that we spend because we require it to be shipped in american vessels, delivering food rather than buying food at the source. john: you also wanted to spend more. >> we want more of the right kind. there are good programs, the millennium celebration that invest in success. the best performing countries rather than subsidizing failure. we want to see more aid given directly to helping small farmers grow more of their own food and you want to see more aid used to support the anti-corruption efforts. john: but what are the odds that that will happen? that the aids support the corrupt dictators as much as half the food aid center at the molly is diverted to corrupt ccntractors, is like militants, local un staff. >> somalia is a difficult environment. john: i will go on. zimbabwean authorities confiscated truck filled with american food aid for school kids and handed it out to supporters of president robert mcgowan boy and a political rally. >> this is one of the problems when the only tool you have is bags of food. john: but by calling for more government aid you are calling for more of the aid that despite all the promises of reform has ended up in the hands of corrupt dictators. >> we are not just calling for more government aid. john: i understand that, and you do some brave work. why do you call for it at all? >> a lot of misconceptions. one of the biggest is that most u.s. assistance actually goes to governments. in fact, that is not true. most goes to u.s. based charities, ngos, contractors john: and the u.n. >> there is portion that goes. we are very clear that they a not the solution. people on the solution to poverty. john: let's hear from an african entrepreneur. a business and american. but she tried operating a business in her own company -- country of senegal. you agree. >> the combination. foreign aid. government. >> i have a very hard time. the african union itself is admitting it is being siphoned through corruption. john: the swiss bank account. >> swiss bank accounts, real estates in the south of france, the son of the dictator of a equatorial guinea he was busted by french customs. his plan was intercepted, and they found in the plane 27 fancy cars. i don't know how many furry some bentleys, rolls-royces. john: the only way to stop that is said keep government out of it. you can get a bunch of people who want to give their own money they won't give it to dictators. >> well, not of governments of the same. we actually work with a lot of anti-corruption and human rights activists in countries around the world who are actually working to try to get their governments to govern more accountable. they're interested in u.s. standing with them in joining this fight. too often we take such an approach to u.s. assistance, we try to make it -- we focus on much and a boarding corruption these activists in telling us that they want to us stand together to fight corruption which means that we need to be their standing with them in solidarity working together. john: why the need government aid? whthe need government aid? >> government id the only tool that can work to solve some of these accountability problems. its like asking why the bears need an offensive line. at some point you need these other tools. it will be entrepreneurs who solve the proem of african poverty. buyou also need government to do other things. john: you need governments. >> unfortunately at least in most countries in africa government has been the problem. they basally say, as an entrepreneur government does nothing but slow me down on a regular basis. officials bribing me all along. the fact that my truck is parked on a regular basis. and i have to pay a single time in the delays. john: government aid will help fight the corruption. >> i'm sorry. the more you're feeding this huge government the more you choke me from the other end. that is at least the phenomenon that i am awareness of. and the more you give to them the more that is what happens to me. john: we do think that there is role that government can play. in a lot ofhe places we actually find there is a government deficit. people have to deal with -- john: why do you believe government aid would provide that? has not so far. >> that is actually not true to a lot of success stories. a lotf african countries that the scene. john: to racine them. thank you. coming up, why our man came up to me on the street and said are you john stossel? i hope you die. ♪ john: someone once came up to me on the street in new york and said, are u john stossel? has sai the spd said to my hope you guys in. so what is this hatred about? it turned out he was what people call and anti-poverty lawyer and did things like sue landlords to stop them from evicting people. in his world here in new york capitalism is the enemy, and the only thing that keeps poor people from being totally impressed his government. so because i call for less government and evil. this town, we libertarians are selfish people. and a good guy is called a bleeding heart liberal. so what is this website about? bleeding heart libertarians. talks about social justice d free-market. georgetown university philosophy professor regularly contributes to the site. why? >> the idea is to recapturehe soul of libertarianism. what they can and should do is embrace the concept of social justice. john: what does the phrase even mean? i am for social justice. >> right. john: for a lot of people it does not mn anything. it just means socialism. there is a real meaning. course of institutions that you expect other people to live by. john: laws, property rights, family rules come anything like that, one of the tests of those institutions should be that y expect when people live and abide by them attend to produce good consequences for everybody. you can show whether you care about this by asking a question like this. imxists were right. imagine there were a disaster, they left the overall majority of people destitute. would you still advocate markets? i think most libertarians would y i would at least have some reservations. the fact that they work matters in the justification. if you think that the new advocate whether you know not what philosophers are calling the social justice. john: i'm rand said that do not consider charity a major vire. selfish. >> what she means is not what most people mean. even if she thinks that i don't think she speaks for most people most are humane, they give to charity, the care that markets work and their work for everybody. the minimum wage, if you did not think that matter why would you argue that because on one. you don't beat you say that the minimum wage causes unemployment among the most laura will people in society and that is part of the reason to oppose it which means that you care of the consequences for the poor. john: the website, bleeding heart libertarian, categories like advocating nurses caring versus helping. >> this explains what is going on with people when they think that libertarians are selfish. if you are on the lefty probably believe that your policie are the only sensible expression of benevolence. you probably think they must disagree with your values and only care of their pocketbooks. that is never really make sense because we have real arguments but also advocacy is cheap. i advocate that we have a 90% marginal tax rate, income over 100,000, if i advocate that it does not cost me anything. if i give money to charity -- john: governments should have bigger anti-poverty program. >> that costs you nothing but you get the warm glow of altruism when you say you advocate that. put your money where your mouth is. does it actually does something. i know your concern. if you're advocating taking income from other people or yourself and that is all you do your not really showing me that you care. john: it is easy to be generous with other people's money. that is what politicians do. >> that's right. john: thank you. coming up, my take on real charity. ♪ ♪ [ male announcer ] they are a glowing example of what it means to the best. and at this special time of year, they shine even brighter. come to the winter event and get the merces-benz you've always wished for, now for an exceptional price. 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[ male announcer ] prilosec otc is the number one doctor recommended frequent heartburn medicine for 8 straight years. one pill each morning. 24 hours. zero heartburn. ♪ john: i used to be pretty cheap. my mom told me, if you don't save your money you will freeze in the dark. so i saved. but when my career took off and i started getting paid money to make speeches i decided to donate the money to charity, and it changed my life. i realize that i like giving money away. it makes me happy. research on what makes people happy backs that up. on average people who give to charity, whether they give them money or just time, they are happier. so death. it is did for us and get for them. though that depends whom you give to. i put on a fake bea and tried begging in new york city. people gave me money. they gave me money when my cardboard sign said thomas and cold, and even gave when i chased it to needed bier. thank you. thank you. john: when they asked givers why they gave people said things like this. >> he looks prey neat, i suppose. john: i just beg for an hour, but i did well. but did this for an eight hour day and would have made $90 a 23,000 year. tax-free. that is the reason social workers say not to give to beggars. often it is a scam plan very often you are an enabling. by giving cash to subsidize the biggest drug or alcohol habit. by not giving you may encourage them to give real help. a few respectable charities illicit on the streets. but most were begging or running scams. >> i need your help. i am homess. john: new york attorney general said this pitch from a group calling itself united homeless is a scam. its director keeps nearly all the money comes bins it on things like his weight watcher bills. i hear you keep most of the money. >> we are homeless people. john: the pages it is going to shelters. >> am i supposed to run a nonprofit and not get money? >> all the people donate absolutely know where the money goes. john: it is hard to find out where your charity money really goes. we can check charity rating services like charity navigator. it is better than nothing. the ratings are not perfect. some charities are not perfect, and rating services sometimes did coned. i give my charity money to groups that i can check out myself, a group that rehabs ex-con and attics. i decided they do a good job because i could see these men. they call them men in blue, ready, willing, able. the clean-air bill york city streets. what is hot is that they do is bring in a step in look cheerful and work fast. i thought whoever is working with these guys has done something right, taught them to take pride in work. i give them money in a couple of other groups that back andes, wt forget about the people of,ob ce good for the world t. and more spending years calling for government to spend more in now he says the best hope >> preaching capital. >> sometimes i politicians don't knowmerce ana that. many americans don't know it. it is time that they learnedw. see you next week. ♪ little plastic shakenight "willis report." lou: new report that the obama t ahead of the 2012 election. dobbs. pass obamace.th presidee ♪ lou: good evening, everyone. "the washington post" reporting controversial regulations on health care and the environment and worker safety, all trying to help the president win reelection lt that is
>> if you're waiting for the government you're going to be in for an awful long way. john: if they get it may be seen more people will realize there are better ways to give. real charity. that is our show tonight. ♪ >> and now. ♪ john: what is real charity? people are in trouble after a disaster or simply when people are poor. americans instead is to think amount and government help. after all, who will help tse people is not government? libertarians argue that private charity would step in. individuals really choosing to help. but with enough of us up? most people say no. that is why libeals like newsday columnist say when it comes to helping the need, that is mostly government's job. >> well, listen, it would be great if people of reach into their hearts and solved all these will problems. that does not happen. in almost every single case where they're is a government program that exists because the private efforts. when you have 04 enough. john: that is because politicians said they were not enough and we could do bette i would argue that a government did not takes a much of our money the private sector would take care of these problems. >> hold on a second. let's get older americans. the poorest sector of our society. something called social security camelot. medicare came along. all the people really do comparatively fairly well. we had hundred kids spread all across america. those numbers were cut dramatically in spite of the generous churches and nice people. >> programs are trillions in debt. unsustainable. >> maybe we have to tweak. but you can't throw away the idea. the reality is we need government then there. john: food stamps, a couple billionaires' could find that all program by themselves. and a private charity wld be better as saying who really needs the food help and to is giving t system. >> i would love that. you know a billionaire who wants to pay to my think we would welcome that. john: did not step in because you're a big fat government is there. people say, oh, the government does that. >> here is the reality in real life. all these private efforts are really important. generous people. we give a lot of money. when the chips are really down and the big thing happens, the typhoon hits the philippines, we love the red cross effort. but they don't have an aircraft carrier with marines on board and rescue helicopters. the u.s. military does. i want them steing toward the philippines when that's-it's. john: i don't know what will happen. in haiti our government promised billions of dollars, billion of it is not done to the people. the new york times said there were going to build 15,000 alums, latest target fewer than 3,000. >> your argument is that government sometimes does not do a perfect job. i concede that. john: i want to play along perversion of thelip earlier. to my left-wing colleagues were talking about how after a disaster faith based charities work better and disaster relief and fema. >> there is fema and then there is the faith based fema. >> if you're waiting for the government you are going to be in for an awful long wait. >> talking about the government response after the tornado in oklahoma in may. now 30 churches banded together to help much more quickly and did a better job in government. this happened with katrina. fema was turning away walmart. people were trying to get water. sending its water to the wrong place. >> you're right. as you know, i am a native of new orleans. there are some things that the province to well. all those kids, wonderful young people who came down, church groups, they did somethi much better than government. but they were still an awful lot of things that we needed government. remember how angry folks were. no one said stay away. john: walmart and private charities got there. >> maybe one of the things of the privates can do is be more nimble. if you are talking about rebuilding, i don't think you want the government to take a pass. john: i do. let's talk about the war on povey. lyndon johnson said he would and poverty. here is where the war began. and sure enough it dropped sharply the first five, seven years after that. to then it stopped improving. >> we teach people to be dependent. that was happening before the war. americans were lifting themselves out of poverty. government continue the progress for five years and then stopped it. >> we should have been more generous, done the other things that government can do to help folks. john: government does not teach a dependency. >> i am not here saying government is profit. government has some bad things, clumsy, bureaucratic. there are things it does really well. hey, private folks, step up. john: these graphs of the test. can we put these up. john: the recession, but it goes up steadily. two lines referred to one is the number of people collecting in the other is the cost. we are teaching people to be passive. >> i wilgrant you that is something we want to avoid. what is the solution from a look at the people and say we will take your food stamps a way? up for the best. >> limit the program some of the private sector stepped in. one me example is the rise of disability test people. straight out. you have fewer people doing manual labor, medicine is better , and more people are disabled. >> i am with you on that one. john: if you want to get rid of it. >> no, i don't want to get rid of it. certainly we can look more closely as of the applications. john: cut it way back. there's a place near college of center, a government office supposedly to help people find jobs. i went there. people said, there are no jobs. we then went around 40 job offers, 28 and to build positions, one restaurant owner said, i would hira dozen people live there woululd just apply. >> i would throw we take nine with no experience in trenton. john: and that the welfare of a steeple told us there are no bs. >> there plenty of jobs. john: government jobs offices to encourage people to take welfare. as somebody go and ask for help to see if it would help her get a job and they said, no, they just to reach for welfare and food stamps. >> again, it is much smarter to have proams that encourage people to work, don't reward laziness,. john: they all do that. >> i don't know. john: private charities and of any suppression did he tell. >> the answer can be to just cut it back a mechanic? john: get it back. and let the private sector in. we will stop there. thank you. atomize a private charity should replace government. what about the rest of the world? people assume global poverty is a problem. it has to be addressed by government giving out foreign aid or maybe the wind. the u.s. and contradicts the title of my book by saying, yes, we, governments, working together can end poverty in just two years. while. two years. of course 50 years ago lyndon johnson claimed his war on poverty would end pover in america. the u.n. will do better. ted turner gave him a billion dollars for this. individual governments and squandered nearlg to lift people out of poverty in africa. i say squandered because after they spent trillions for income per capita it went down. that is maybe because the foreign aid encourages dependency and african kleptocrats government sal much of the money. what is the alternative? michael fay says he has an answer. what is yours? >> we are going straight to the port. cash transfers from you directly to them. no middleman, no leakage, no hidden costs. john: the charity, and y have raised about $6 million. just given 27,000 people-the thousand dollars each. >> that is exactly right. a thousand for the households. john: this sounds like a stupid idea. they will just spend it and then it won't have any. >> you are not the only one. the truth is there has been about a decade of research that shows the exact opposite. what are these people missing? a lot of them are missing the catal. we have the old expression teach a man to fish. the truth is they don't have fishing poles. john: so you allow them to buy a fishing pole or in this case this may have been a guy who got a motorcycle and use it for a taxi service. >> this is a used motorcycle that he bought with cash and now provides tax to services. john: he gives the people a cell phone with the money. >> that is the way we transfer the money. found the phone. if they don't have a phone them in a deal to get the money. john: and it is easier to check up on them. >> we check, call them, talk to them regularly. john: peopleuild metal roofs. the most popular thing. >> no charity. saves income, clean water, was malaria. we did not think of it, they did. john: before they had that they had at that's true fan is bad about a hundred dollars a year. john: instead they can start a business, another person had received training from another charitto be a welder. >> said he was standing there doing nothing. he did not have welding equipment. john: what makes you think this work? >> we have a decade of evidence, we have done our own third-party valuation. we know income goes up a monstrous level goes down, under follows. john: you do another odd thing. none of your charity board members works full-time for your charity. >> here is the great thing. if it is not working i would not lead to -- need to lie the right attitude my job. john: you could be more honest evaluating it. the charities delude themselves. >> well, i think people have passion a often implies evidence. john: i have hard time accepting i just criticize government pro grams because they don't teach people to take care of themselves. i guess giving cash once and knowing that iwill keep coming is different. >> a onetime transforming event it does not matter who does it. matters what they do. why buy a cow when the person is to will then. john: to take care of it? look to make the choice. john: i hope it works. i'm glad a lot of these experiments are going on. thank you. if you would like toeep this conversation going go to facebook or twitter and use that has tank. real charity. that people know what you think. coming up, president obama's says the way to help poor people is to give them a free cell phone. ♪ ñ@ç@çpçpçpç÷ñoxmhmhyhyhyhyh ♪ >> the government will pay for you to have a free cell phone with monthly minutes, no credit check and noeposit required. john: of free cell phone. 253 minutes. what the deal. this is to help poor people in need a lifeline. that is reasonable. this is a government program that began with ronald reagan. president obama expanded it, of course. and in just four years the costs tripled and will continue rice can. >> a minority. you know. he gave up. , no income, disability. john: the more free stuff you get the more you're elible to get. but eligible is. what did you do? >> i went to all the welfare offices in manhattan and a couple in brooklyn and found out that there are people of their approach you on the street as the if you have your free phone yet. outside the office. john: private entrepreneur. >> and not on welfare. i told them that. i would ke to be buried at think a lot of the people would like to be. but that was enough. they ended up giving me not one, not to, but three free phones. john: the good news is someplace is turned down. >> yeah. they ended up. first of, you are not supposed to have duplicate files which i have already broken and will. there also supposed to check eligibility. they also did not catch the eye and multiple applications and and try to work power to the system again and again. john: and fcc audit, they found 41 percent of the recipients never demonstrated that they were eligible. >> that's about 6 million people. the what you really see is the phone companies have a very perverse incentive to push those bonds and on the street. ey get $9.25 per customer per month for this program. the street vendors -- john: is paid for out of your phone bill. if you bothered to read the fine print, there is something called the universal service charge. this was under ronald reagan, make sure everybody and a phone line. universal service. a dollar and two out of every race home built. bison i think that most taxpayers don't know what. i went out and investigated. i didn't know. john: bore people talk to their families. >> the phone companies of the bad guys in this. this is a huge business. the mexican billionaire, one of the richest peoe in the world. john: he may be the richest. >> csn bill gates compete. but he got in 2011 alone half a billion dollars from this program. so what turned out to be welfare for the poor is actually corporate welfare plan in simple john: and what about my obnoxious question. you don't want to help the poor? >> well, i think maybe there would be justification for a land line. as with a program started out as, but anytime you have perverse incentives for companies to go and no phones combined with the very poor oversight you have to ask yourself, you creating a situation in which fraud and abuse can just compound? that is what we have. jo: it should not surprise anyone that government charity is susceptible to fraud. the contractors doing the work. no one's money. the more they give out the more they get to keep. they get a commission on each give away. the cellphone charities, $2 billion. think about the hundreds of billions spent on medicare and medicaid. much more from there. people work out with all this stuff. one man alone spent $20 million on thisiamond jewelry, also a fleet of luxury cars, one after the other. all of which she got because government paid millions for medical treatment that never happened. government health is just extra susceptible to abuse. >> and is definitely what i found. was surpsed that i was able to get three of them in violation a pretty much every program wall, and if i can do it being someone he tells the truth, just a man from the people. atually willing to abuse the program. john: private companies get ripped off. but they have more of an incentive to check. it's their own money. >> that's right. georgia is actually doing reform within the states to try to see if they can mess with that fundamental flaw in incentive structure. there will start charging $5 for consumers. they have to pay $5 spirit there less likely to god and by. john: thank you. coming up, better ways tl people. ♪ this is the quicksilver cash back card from capil one. it's not the "limit the cash i earnvery month" card. it's not the "i only earn decent rewards at the gas station" card. it's the no-games, no-signing up, everyday-rewarding, kung-fu-fighting, silver-lightning-in-a-bottle, bringing-home-the-bacon cash back card. this is the quicksilver card from capital one. unlimited 1.5% cash back on eve purchase, everywhere, every single day. so ask yourself, what's in your wallet? ♪ john: one of the richest people in the world is warren buffett. is the jeep? he is one of many billionaire sue until recently gave very little to charity. he used his money to try to make more money. he said he would give it away when he died. his fellow billionaire ted turner told me buffett was being cheap. she should ge some away now john: turner just made a big splash by giving a billion dollars to the wind. now he said he wanted to shame other rich people into giving more. >> what he said is bad and the stupid. john: that was his answer. >> what he should do is take his money and invested. he can help people in the other better way into invested and have the companies in building in plans that creating the investment creates jobs and wealth and products for other people. john: really? is itt better if a money maker uses money to make more rather than give to charity? i think so. add to that question back to ted turner. >> bill gates says, and get it making money. john: that try to argue this, but he wasn't buying it. john: and i wrong in thinking that i am happy if he gives that the charity? >> when you be happier if he did? you alleges -- this is what people don't like these men. i know your dirty tricks. there is nothing more say. goodbye. i am walking out. john: he did not want to talk about it. let's take that same question to an economist to rise a free-market institute at texas tech. >> i am not bothered if they don't give more of it away. they make their money by making allies that. they are helping people. often that is the best with a can help. john: and then make a profit than they hire people, those jobs live on for years. people use it to educate there kids and feed their family. there is a multiplier. these guys may not even begin dexterity. we know they're good at making money. stick to what your specialty is. >> it's about the results. if leeson to do the things that we want them to do. of course the real reason is that creating the products and services that make our lives better, but as a byproduct they create jobs that make other people better off. it is what is fundamental responsible for the high standard of living we enjoy. john: said most of them, i would say to my don't feel good about all the wealth they create in their business and guiltily give to charity. even bill gates is now working full time on charity he says he thinks most charity has to come from government. >> a lot of the money that is supporting these causes is coming from the private sector, people like you and less from the government. john: governments are the backbone of this. >> no, no, no. he is good as computers, not it is social policy. just last week had a research paper presented about the great chicago fire of 1871. what happened afterward, there was no fema. it was private charity and civil society organizations the banded together and help get people out of the city who lost their mes, brought in new shelter, clothing. judging from what i was hearing from my work to haggle a lot better than fema of ordering people when they can and cannot go and buts in the process to beha of. john: a recent edition of forbes magazine, the richest people's list featured philanthropy. so how they are now reading billionaires' by how much they give. a kind of want my heart. let's have a competition. >> there is nothing wrong with people giving money to the causes a thinker valuable. not every good or service will be produced for profit. some of it can come from this segment of society, and it's fine that we recognize that as long as we don't demonize those who aren't doing it and think there's something wrong with them pursuing profit because there is not. that osmanli makes us better off john: there are these tycoons from previous years cornelius vanderbilt and john d. rockefeller and people who vilify them. they did some charity work. they were evil robbers. >> they fundamentally transformed the lives of americans and raising living standards. rockefeller brought us well and made profits. by the way, he probably is also responsible for saving the whales because he pushed down the price of oil it was no longer profitable to how best to extinction henry ford makes jeep automobiles. it does not matter that is motive was profits. he made automobiles affordable for the average middle-class american. the same is true of most of these so-called robber barons of the late 19th and early 20th century. john: thank you. up next, if i put on a fake beard and chemistry of people beard and chemistry of people give me mon what about jobs? no? now try your closet. still no jobs? just more... stuff? well, you really have both. see, "stuff" is defined as "household articles considered as a group". sometimes this stuff is no longer needed. wait, no longer needed? that can't be right. because remember those jobs you were looking for? those are really needed, and they're the stuff inside your stuff. our job is to unlock those jobs. and it starts when you donate your stuff to your local goodwill. here's how we do it: when you donate to goodwill, we sell your stuff to provide job training for people right here in your community. so just by teaming up with goodwill, you help create jobs. and isn't that worth parting with the leftover keytar from your 80's cover band? goodwill. donate stuff. create jobs. ♪ john it will come to an end. the sooner the better the billions we spend on foreign aid. much of which is squandered o >> cut off american assistance to these democratienreudget ofd states of america. john: it's pretty close to 1%. $35 million. i y we can't afford that. gregory adams runs of sam's 80 effectively says we should spend more. a giant charity it tries to fight poverty over the world. i say, fine. if you want to do that, you raise the money he believes government out of it. >> the issue is that there are some things that charities just can't do. despite the iact that they have around the world, and we are proud of the work that we do with money raised from average americans, there is only so much that we can do with our own projects. some places government needs to step in. john: all right. government needs to make sure aids workers and of being murdered on the way to where they're going. and i should say that you don't take governmentoney from the united states. to other countries. but you call for government to spend more on foreign aid. why when so much has been squandered? >> it is important to know that we're calling for more of the right kind of a. john: this is going to be the right kind. >> there are some things that we think the unitestates government is doing that we think is not a good use of money. particular, food aid is in desperate need of reform. we miss about half of the value of every dollar that we spend because we require it to be shipped in american vessels, delivering food rather than buying food at the source. john: you also wanted to spend more. >> we want more of the right kind. there are good programs, the millennium celebration that invest in success. the best performing countries rather than subsidizing failure. we want to see more aid given directly to helping small farmers grow more of their own food and you want to see more aid used to support the anti-corruption efforts. john: but what are the odds that that will happen? that the aids support the corrupt dictatorss much as half the food aid center at the molly is diverted to corrupt ccntractors, is like militants, local un staff. >> somalia is a difcult environment. john: i will go on. zimbabwean authorities confiscated truck filled with american food aid for school kids and handed it out to supporters of president robert mcgowan boy and a political rally. >> this is one of the problems when the only tool you have is bags of food. john: but by calling for more government aid you are calling for more of the aid that despite all the promises of reform has ended up in the hands of corrupt dictators. >> we are not just calling for more government aid. john: i understand that, and you do some brave work. why do you call for it at all? >> a lot of misconceptions. one of the biggest is that most u.s. assistance actually goes t governments. in fact, that is not true. most goes to u.s. based charities, ngos, contractors. john: and the u.n. >> there is portion that goes. we are very clear that they are not the solution. people on the solution to poverty. john: let's hear from an african entrepreneur. a business and american. but she tried operating a business in her own company -- country of senegal. you agree. >> the combination. foreign aid. government. >> i have a very hard time. the african union itself is admitting it is being siphoned through corruption. john: the swiss bank account. >> swiss bank accounts, real estates in the south of france, the son of the dictator of a equatorial guinea. he was busted by french customs. his plan was intercepted, and they found in the plane 27 fancy cars. i don't know how many furry some bentleys, rolls-royces. john: the only way to stop that is said keep government out of it. you can get a bunch of people who want to give their own money they won't give it to dictators. >> well, not of governments of the same. we actually work with a lot of anti-corruption and human rights activists in countries around the world who are aually working to try to get their governments to govern more accountable. they're intere.s. standing with them in joining this fight. too often we take such an approach to u.s. assistance, we try to make itwa to fight corrun which means that we need to be problems.ding with t in it is like asking why the bears need an offensive some point yoe other tools. it will be entrepreneurs who solve thejohn: you need governm. >> unfortunately at least in most countries in africa s bribl on a regular basis. and i have to pay a singl john: government aid will help fight the corruption. >> i e more you're feeding this huge government the more you choke me fromhe other end. that is at least the phenomenon that i am awareness of. and the more you give to them the more that is what happens to me. john: we do think that there is role that government can play. in a lot of the people have to deal with -- john: why do you believe government aid would provide that? has not so far. >> that is actually not true to a lot of success stories. a lot of african countries that the scene. john: to racine them. thank you. coming up, why our man came up to me on the street and said are you john stossel? i hope you die. ♪ grew up in a small town d when the rain would fall down ♪ ♪ i'd just stare out my window ♪ ♪ dreaming of what could be and if i'd end up happy ♪ ♪ i would pray i could breakaway ♪ ♪ i'll spread my wings and i'll learn how to fly ♪ i'll do what it takes till i touch the sky ♪ ♪ i gotta take a risk, take a chance, make a change, and break away ♪ ♪ wanna feel the warm breeze, sleep under a palm tree ♪ ♪ feel the rush of the ocean ♪ ♪ get on board a fast train, travel on a jet plane far away ♪ ♪ and break away ♪ out of the darkness and into the sun ♪ ♪ but i won't forget the place i come from ♪ ♪ i gotta take a risk, take a chance, make a change, and breaaway ♪ ♪ john: someone once came up to me on the street in new york and said, are you john stossel? has said the spd said to my hope you guys in. sohat is this hatred about? it turned out he was what people call and anti-poverty lawyer and did things like sue landlords to stop them from evicting people. in his world here in new york capitalism is the enemy, and the only thing that keeps poor people from being totally impressed his government. so because i call for less government and evil. this town, we libertarians are selfish people. and a good guy is cled a bleeding heart liberal. so what is this website about? bleeding heart libertarians. talks about social justice and free-market. georgetown university philosophy professor regularly contributes to the site. why? >> the idea is to recapture the soul of libertarianism. what they can and should do is embrace the concept of social justice. john: what does the phrase even mean? i am for social justice. >> right. john: for a lot of people it does not mean anything. it just means socialism. there is a real meaning. course of institutions that you expect other people to live by. john: laws, property rights, family rules come anything like that, one of the tests of those institutions should be that you expect when people live and abide by them attend to produce good consequences for everybody. you can show whether you care about this by asking a question like this. imagine that marxists were right. imagine there were a disaster, they left the overall majority of peoe destitute. would you still advocate markets? i think most libertarians would say i would at least have some reservations. the fact that they work matters in the justification. if you think that the new advocate whether you know not what philosophers are calling the social justice. john: i'm rand said that do not nsider charity a major virtue. selfish. >> what she means is not what most people mean. even if she thinks that i don't think she speaks for most people most are humane, they give to charity, the care that markets work and their work for everybody. the minimum wage, if you did not think that matter why would you argue that because on one. you don't beat you say that the minimum wage causes unemployment among the most laura will people in society and that is part of the reason to oppose it which means that you care of the consequences for the poor. john: the website, bleeding heart libertarian, categories like advocating nurses caring versuselping. >> this explains what is going on with people when they think that libertarians are selfish. if you are on the lefty probably believe that your policies are the only sensible expression of benevolence. you probably think they must disagree with your values and only care of their pocketbooks. that is never really make sense because we have real arguments but also advocacy is cheap. i advocate that we have a 90% marginal tax rate, income over 100,000, if i advocate that it does not cost me anything. if i give money to charity -- john: governments should have a bigger anti-poverty program. >> that costs you nothing but you get the warm glow of altruism when you say you advocate that. put your money where your mouth is. does it actually does something. i know your concern. if you're advocating taking income from other people or yourself and that is all you do your not really showing me that you care. john: it is easy to be generous with other people's money. that is what politicians do >> that's right. john: thank you. coming up, my take on real charity. ♪ - while i was in the military, i served mcountry. i did my job. but as a veteran with a disability, i was worried about my career prospects. after my traumatic brain injury, vocrehab helped me roll up my sleeves and get back to work. - made me realize i could plant a beautiful garden for my community center. - took my professional development to the next level with vocational counseling and education. ♪ - showed me a bright future, even though my sight was damaged in combat. ♪ - elevated my career, even though a back injury prevented me from doing heavy lifting. - prepared me for my next mission, and helped me realize that success after the service is possible. announcer: if your service-connected disability prevents you from continuing in your civilian career, vocrehab offers counseling, training with a living allowance, education, and other services to help prepare you for your next mission. ♪ john: i used to be prett cheap. my mom told me, if you don't save your money you will freeze in the dark. so i saved. but when my career took off and i started getting paid money to make speeches i decided to donate the money to chaty, and it changed my life. i realize that i like giving money away. it makes me happy. research on what makes people happy backs that up. on average people who give to charity, whether they ve them money or just time,hey are happier. so death. it is did for us and get for them. though that depends whom you give to. i put on a fake beard and tried begging in new york city. people gave me money. they gave me money when my cardboard sign said thomas and cold, and even gave when i chased it to needed bier. thank you. thank you. john: when they asked givers why they gave people said things like this. >> he looks pretty neat, i suppose. john: i just beg for an hour, but i did well. but did this for an eight hour day and would have made $90 a 23,000 year. tax-free. that is the reason social workers say not to give to beggars. often it is a scam plan very often you are an enabling. by giving cash to subsidize the biggest drug or alcohol habit. by not giving you may encourage them to give real help. a few respectable charities illicit on the streets. but most were begging or running scams. >> i need your help. i am homeless. john: new york attorney general said this pitch from a group calling itself united homeless is a scam. its director keeps nearly all the money comes bins it on things like his weight watcher bills. i hear you keep most of the money. >> we are homeless people. john: the pages it is going to shelters. >> am i supposed to run a nonprofit and not get money? >> all the people donate absolutely know where the money goes. john: it is hard to find out where your charity money really goes. we can check charity rating services like charity navigator. it is better than nothing. the ratings are not perfect. some charities are not perfect, and rating services sometimes d coned. i give my charity money to groups that i can check out myself, a group that rehabs ex-con and attics. i decided they do a good job because i could see these men. they call them men in blue, ready, willing, able. the clean-air bill york city streets. what is hot is that they do is bring in a step in look cheerful and work fast. i thought whoever is working with these guys has done something right, taught them to take pride in work. i give them money in a couple of other groups that back and watch. while i give to what i think are good charities, we should not forget about the people of, capitalists, on this once. but job creators do much more good for the world that politicians. and more even than that do-gooders' working for charity. i am delighted that the singer bought of figure that out after spending years calling for government to spend more in foreign-aid flop. now he says the best hope for the four is free markets. >> preaching capit. >> sometimesear myself, and iust cannot believe it. commerce is real. just a stopgap. >> commerce and on to para capitalism takes more people out of poverty. we know that. john: politicians don't know that. many americans don't know it. it is time that they learned. entrepreneurial capitalism takes more people out of poverty and a never well. that is our show. see you next week. ♪ hello! i'm dave gentry! welcome to small stocks and big money! intro music intro music intro music intro music welcome to redchip nation! i hope your holidays a happy, peaceful and pritable. and i want to thank you for joining us today. you know, we're the only show on any major network, that focuses exclusively on smaller cap companies.
government you're going to be in for an awful long way. john: if they get it may be seen more people will realize there are better ways to give. real charity. that is our show tonight. ♪ >> and now. ♪ john: what is real charity? people are in trouble after a disaster or simply when people are poor. americans instead is to think amount and government help. after all, who will help those people is not government? libertarians argue that private charity would step in. individuals really choosing to he. but with enough of us up? most people say no. that is why liberals like newsday columnist say when it comes to helping the need, that is mostly government's job. >> well, listen, it would be great if people of reach into their hearts and solved all these will problems. that does not happen. in almost every single case where they're is a government program that exists because the private efforts. when you have 04 enough. john: that is because politicians said they were not enough and we could do better. i would argue that a government did not takes a much of our money the private sector would take care of these problems. >> hold on a second. let's ge older americans. the poorest secr of our society. something called social security camelot. medicare came along. all the people really do comparatively fairly well. we had hundred kids spread all across america. those numbers were cut dramatically in spite of the generous churches and nice people. >> programs are trillions in debt. unsustainable. >> maybe we have to tweak. but you can't throw away the idea. the reality is we need government then there. john: food stamps, a couple billionaires' could find that all program by themselves. and a private charity would be better as saying who really needs the food help and to is giving the system. >> i would love that. you know a billionaire who wants to pay to my think we would welcome that. john: did not step in because you're a big fat government is there. people say, oh, the government does that. >> here is the reality in real li. all these private efforts are real important. generous people. we give a lot of money. when the chips are really down and the big thing happens, the typhoon hits the philippines, we love the red cross effort. but they don't have an aircraf carrier with marines on board and rescue helicopters. the u.s. military does. i want them steaming toward the philipnes when that's-it's. john: i don't know what will ppen. in haiti our government promised billions of dollars, billion of it is not done to the people. the new york times sd there were going to build 15,00 alums, latest target fewer than 3,000. >> your argument is that government sometimes does not do a perfect job. i concede that. john: i want to play along perversion of the clip earlier. to my left-wing colleagues were talking about how after a disaster faith based charities work better and disaster relief and fema. >> there is fema and then there is the faith based fema. >> if you're waiting for the government you are going to be in for an awful long wait. >> talking about the government response after the tornado in oklahoma in may. now 30 churches banded together to help much more quickly and did a better job in government. this happened with katrina. fema was turning away walmart. people were trying to get water. sending its water to the wrong place. >> you're right. as you know, i am a native of new orleans. there are some things that the province to well. all those kids, wonderful young people who came down, church groups, ey did something much better than government. but they were still an awful lot of things that we needed government. remember how angry folks were. no one said stay away. john: walmart and private charities got there. >> maybe one of the things of the privates can do is be more nimble. if you are talking about rebuilding, i don't think you want the government to take a pass. john: do. let's talk about the war on poverty. lyndon johnson said he would and poverty. here is where the war began. and sure enough it dropped sharply the first five, seven years after that. to then it stopped improving. >> we teach people to be dependent. that was happening before the war. americans were lifting themselves out of poverty. government continue the progress for five years and then stopped it. >> we should have been more generous, done the other things at government can do to help folks. john: government does not teach a dependency. >> i am not here saying government is profit. government has some bad things, clumsy, buraucratic. there are things it does really well. hey, private folks, step up. john: these graphs of the test. can we put these up. john: the recession, but it goes up steadily. two lines referred to one is the number of people collecting in the other is the cost. we are teaching people to be passive. >> i will grant you that is something we want to avoid. what is the solutiofrom a look at the people and say we will take your food stamps a way? up for the best. >> limit the program some of the private sector stepped in. one more example is the rise of disability test people. stight out. you have fewer people doing manual labor, medicine is better , and more people are disabled. >> i am with you on that one. john: if you want to get rid of it. >> no, i don't want to get rid of it. certainly we can look more closely as of the applications. john: cut it way back. there's a place near college of center, a government office supposedly to help people nd jobs. i went there. people said, there are no jobs. we then went around 40 job offers, 28 and to build positis, one restaurant owner said, i would hire a dozen people live there would just apply. >> i would throw we take nine with no experience in trenton. john: and that the welfare of a steeple told us there are no jobs. >> there plenty of jobs. john: government jobs offices to encourage people to take welfare. as somebody go and ask for help to see if it would help her get a job and they said, no, they just to reach for welfare and food stamps. >> again, it is much smarter to have pgrams that encourage people to work, don't reward laziness,. john: they all do that. >> i don't know. jo: private charities and of any suppression did he tell. >> the answer can be to just cut it back a mechanic? john: get it back. and let the private sector in. we will stop there. thank you. atomize a private charity should replace government. what about the rest of the world? people assume global poverty is a problem. it has to be addressed by vernment giving out foreign aid or maybe the wind. the u.s. and contradicts the title of my book by saying, yes, we, governments, working together can end poverty in just two years. while. two years. of course 50 years ago lyndon johnson claimed his war on poverty would end poverty in america. the u.n. will do better. ted turner gave him billion dollars for this. individual governments and squandered nearly a trillion dollars of foreign aid trying to lift people out of poverty in africa. i say squandered because after they spent trillions for income per capita it went down. that is maybe because the foreign aiddependency and africn kleptocrats government steal much of the money. what is the alternative? michael fay says he has an answer. what is yours? >> we are going straighto the port. cash transfers from you directly to them. no middleman, no leakage, no hidden costs. john: the charity, and you have raised about $6 million. just given 27,000 people-the thousand dollars each. >> that is exactly right. a thousand for the households. john: this sounds like a stupid idea. they will just spend it and then it won't have any. >> you are not the only one. the truth is there has been about a decade of research that shows the exact opposite. what are these people missing? a lot of them are missing the capital. we have the old expression teach a man to fish. the truth is they don't have fishing poles. john: so you allow them to buy a fishing pole or in this case this may have been a guy who got a motorcycle and use it for a taxi service. >> this is a used motorcycle that he bought with cash and now provides tax to services. john: he gives the people a cell phone with the money. >> that is the way we transfer the money. found the phone. if they don't have a phone them in a deal to get the money. john: and it is easier to check up on them. we check, call them, talk to them regularly. john: people build metal roofs. the most popular thing. >> no charity. saves income, clean water, was malaria. we d not think of it, they did. john: before they had that they had at that's true fan is bad about a hundred dollars a year. john: instead they can start a business, another prson had received training from another charity to be a welder. >> said he was standing there doing nothing. he did not have welding equipment. john: what makes you think this work? >> we have a decade of evidence, we have done our own third-party valuation. we know income goes up a monstrous level goes down, under follows. john: you do another odd thing. none of your charity board members works full-time for your charity. >> here is the great thing. if it is not working i would not lead to -- need to lie the right attitude my job. john: you could be more honest evaluating it. the charities delude themselves. >> well, i think people have passion and often implies evidence. john: i have hard time accepting i just criticize government pro grams because they don't teach people to take care of themselves. i guess giving cash once and knowing that it will keep coming is different. >> a onetime transforming event it does not matter who does it. matters what they do. why buy a cow when the person is to will then. john: to take care of it? look to make the choice. john: i hopet works. i'm glad a lot of these experiments are going on. thank you. if you would like to keep this conversation going go to facebook or twitter and use that has tank. real charity. that people know what you think. coming up, president obama's says the way to help poor peopl is to give them a free cell phone. ♪ this is the quicksilver cash back card from capil one. it's not the "limit the cash i earnvery month" card. it's not the "i only earn decent rewards at the gas station" card. it's the no-games, no-signing up, everyday-rewarding, kung-fu-fighting, silver-lightning-in-a-bottle, bringing-home-the-bacon cash back card. this is the quicksilver card from capital one. unlimited 1.5% cash back on eve purchase, everywhere, every single day. so ask yourself, what's in your wallet? ♪ >> the government will pay for you to have a free cell phone with monthly minutes, no credit check and no deposit required. john: of free cell phone. 253 minutes. what the deal. this is to help poor people in need a lifeline. that is reasonable. this is a government program that began with ronald reagan. president obama expanded it, of course. and in just four years the costs tripled and will continue rice can. >> a minority. you know. he gave up. , noncome, disability. john: the more free stuff you get the more you're eligible to get. but eligible is. what did you do? >> i went to all the welfare offices in manhattan and a couple in brooklyn and found out that there are people of their approach you on the street as the if you have your free phone yet. outside the office. john: private entrepreneur. >> and not on welfare. i told them that. i would like to be buried at think a lot of the people would like to be. but that was enough. they ended up giving me not one, not to, but three free phones. john: the good news is someplace is turned down. >> yeah. they ended up. first of, you are not supposed to have duplicate files which i have already broken and will. there also supposed to check eligibility. they also did not catch the eye and multiple applications and and try to work power to the system again and again. john: and fcc audit, they found 41 percent of the recipients never demonstrated that they wereligible. >> that's about 6 million people. the what you really see is the phone companies have a very perverse incentive to push those bonds and on the street. they get $9.25 per customer per month for this program. the street vendors -- john: is paid for out of your phone bill. if you bothered to read the fine print, there is something called the universal service charge. this was under ronald reagan, make sure everybody and a phone line. universal service. a dollar and two out of every race home built. bison i think that most taxpayers don't know what. i went out and investigated. i didn't know. john: bore people talk to their families. >> the phone companies of the bad guys in this. this is a huge business. the mexican billionaire, one of the richest people in the world. john: he may be the richest. >> csn bill gates compete. but he got in 2011 alone half a billion dollars from this program. so what turned out to be welfare for the poor is actually corporate welfare plan in simple john: and what about my obnoous question. you don't want to help the poor? >> well, i think maybe there would be justification for a land line. as with a program started out as, but anytime you have perverse incentives for companies to go and no phones combined with the very poor oversight you have to ask yourself, you creating a situation in which fraud and abuse can just compound? that is what we have. john: it should not surprise anyone that government charity is susceptibleo fraud. the contractors doing the work. no one's money. the more they give out the more they get to keep. they get a commission on each give away. the cellphone charities, $2 billion. think about the hundreds of billions spent on medicare and medicaid. much more from there. people work out with all this stuff. one man alone spent $20 million on this diamond jewelry, also a fleet of luxury cars, one after the other. all of which she got because government paid millions for medical treatment that never happened. government health is just extra susceptible to abuse. >> and is definitely what i found. was surprised that i was able to get three of them in violation a pretty much every program wall, and if i can do it being someone heells the truth, just a man from the people. actually willing to abuse the program. john: private companies get ripped off. but they have more of an incentive to check. it's the own money. >> that's right. georgia is actually doing reform within the states to try to see if they can mess with that fundamtal flaw in incentive structure. there will start charging $5 for consumers. they have to pay $5 spirit there less likely to god and by. john: thank you. coming up, better ways tell people. ♪ [beep] [indistinct chatter] [kids talking at once] [speaking foreign language] [heart beating] [heartbeat continues] [faint singing] [heartbeat, music playing louder] ♪ i'm feeling better since you know me ♪ ♪ i was a lonely ul, but that's the old me... ♪ announcer: this song was created with heartbeats of children in need. find out how it can help frontline health workers bring hope to millions of children at everybeatmatters.org. ♪ john: one of the richest people in theorld is warren buffett. is the jeep? he is one of many billionaire sue until recently gave very little to charity. he used his money to try to make more money. he said he would give it away when he died. his fellow billionaire ted turner told me buffett was being cheap. >> she should give some away now john: turner just made a big splash by giving a billion dollars to the wind. now he said he wanted to shame other rich people into giving more. >> what he said is bad and the stupid. john: that was his answer. >> what he should do is take his money and invested. he can help people in the other better way into invested and have the companies in building in plans that creating t investment creates jobs and wealth and products for other people. john: really? is it better if a money maker uses money to make more rather than give to charity? i think so. add to that question back to ted turner. money. gates says, and get it john: that try to argue this, but he wasn't buying it. john: and i wrong in thinking that i am happy if he gives that the charity? >> when you be happier if he did? you alleges -- this is what people don't like these men. i know your dirty tricks. there is nothing more say. goodbye. i am walking out. john: he did not want to talk about it. let's take that same question to an economist to rise a free-market institute at texas tech. >> i am not bothered if they don't give more of it away. they make their money by making allies that. they are helping people. often that is the best with a can help. john: and then make a profit than they hire people, those jobs live on for years. people use it to educate there kids and feed their family. there is a multiplier. these guys may not even begin dexterity. we know they're good at making money. stick to what your specialty is. >> it's about the results. if leeson to do the things that we want them to do. of course the real reason is that creating the products and services that make our lives better, but as a byproduct they create jobs that make other people better off. it is what is fundamentally responsible for the high standard of living we enjoy. john: said most of them, i would say to my don't feel good about all the wealth they create in their busess and guiltily give to charity. even bill gates is now working full time on charity he says he thinks most charity has to come from government. >> a lot of the money that is supporting these causes is coming from the private sector, people like you and less from the government. john: governments are the backbone of this. >> no, no, no. he is good as computers, not it is social policy. just last week had a research paper presented abouthe great chicago fire of 1871. what happened afterward, there was no fema. it was private charity and civil society organizations the banded together and help get people out the city who lost their homes, broughtn new shelter, clothing. judging from what i was hearing from my work to haggle a lot better than fema of ordering people when they can and cannot go and buts in the process to behalf of. john: a recent edition of forbes magazine, the richest people's list featured philanthropy. so how they are now rding billionaires' by how much hey give. a kind of want my heart. t's have a competition. >> there is nothing wrong with people giving money to the causes a thinker valuable. not every good or service will be produced for profit. some of it can come from this segment of society, and it's fine that we recognize that as long as we don't demonize those who aren't doing it and think there's something wrong with them pursuing profit because there is not. that osmanli makes us better off john: there are these tycoons from previous years cornelius vanderbilt and john d. rockefeller and people who vilify them. they did some charity work. they were evil robbers. >> they fundamentally transformed the lives of americans and raising living standards. rockefeller brought us well and made profits. by the way, he probably is also responsible for saving the whales because he pushed down the price of oil it was no longer profitable to how best to extinction henry ford makes jeep automobiles. it does not matter that is motive was profits. he made automobiles affordable for the average middle-class american. the same is true of most of these so-called robber barons of the late th and early 20th century. john: thank you. up next, if i put on a fake beard and chemistry of people beard and chemistry of people give me monúp@@xcçx who you are or what you do arthritis does not discrimite i thought it was an old person's disease, then it happened to me i was dinosed with arthritis when i was four years old. i was two i had just turned 50 i am one i am one of over 50 million americans affected by the chronic pain of arthritis. i am one of 300,000 kids with ahritis. we are your friends... we are co-woers we are your kids there are more of us out there than you would think. we are the face of arthritis at the age of 25, i had to stop working. by the age of 12, i had both my hips replaced. sometimes it doesn't aow me to be the mom i want to be. we are the face...of arthritis spreadhe word tell the world if we stand together fight together we will find a cure i believe do you? join the arthritis foundation to stop america's #1 cause of disability. learn the truth about arthritis at facesofarthritis.org ♪ john: it will come to an end. the sooner the better the billions we spend on foreign aid. much of which is squandered or stolen. i agree with ron paul and his son, the senator. we should stop almost all foreign aid. the one libertarians say that people need angry. >> cut off american assistance to these democratic efforts. pull the eight out. what the heck. less than 1 percent of the entire budget of the united states of america. john: it's pretty close to 1%. $35 million. i say we can't afford that. gregory adams runs of sam's 80 effectively says we should spend more. a giant chaty it tries to fight poverty over the world. i say, fine. if you want to do that, you raise the money he believes government out of it. >> the issue is that there are some things that charities just can't do. despite the impact that they have around the world, and we are proud of the work that we do with money raised from average americans, there is only so much that we can do with our own projects. some places government needs to step in. john: all right. government needs to make sure aids workers and of being murdered on the way to where they're going. and i should say that you don't take gernment money from the united states. to other countries. but you call for government to spend more on foreign aid. why when so much has been squandered? >> it is important to know that we're calling for more of the right kind of a. john: this is going to be the right kind. >> there are some things that we think the united states government is doing that we think is not a good use of money. particular, food aid is in desperate need of reform. we miss about half of the value of every dollar that we spend because we require it to be shipped in american vessels, delivering food rather than buying food at the source. john: you also wanted to spend more. >> we wa more of the right kind. there are good programs, the millennium celebration that inst in success. the best performing countries rather than subsidizing failure. we want to see more aid given directly to helping small farmers grow more of their own food and you want to see more aid used to support the anti-corruption efforts. john: but what are the odds that that will happen? that the aids support the corrupt dictators as much as half the food aid center at the molly is diverted to corrupt ccntractors, is like militants, local un staff. >> somalia is a difficult environment. john: i will go on. zimbabwean authorities confiscated truck filled with american food aid for school kids and handed it out to supporters of president robert mcgowan boy and a political rally. >> this is one of the problems when the only tool you have is bags of food. john: but by calling for more government aid you are calling for more of the aid that despite all the promises of reform has ended up in the hands of corrupt dictators. >> we are not just calling for more government aid. john: i understand that, and you do some brave work. why do you call for it at all? >> a lot of misconceptions. one of the biggest is that most u.s. assistance actually goes to governments. in fact, that is not true. most goes to u.s. based charities, ngos, contractors. john: and the u.n. >> there is portion that goes. we are very clear that they are not the solution. people on the solution to poverty. john: let's hear from an african entrepreneur. a business and american. but she tried operating a business in her own company -- country of senegal. you agree. >> the combination. foreign aid. government. >> i have a very hard time. the african union itself is admitting it is being siphoned through corruption. john: the swiss bank account. >> swiss bank accounts, real estates in the south of france, the son of the dictator of a equatorial guinea. he was busted by french customs. his plan was intercepted, and they found in the plane 27 fancy cars. i don't know how many furry some bentleys, rolls-royces. john: the only way to stop that is said keep government out of it. you can get a bunch of people who want to give their own money they won't give it to dictators. well, not of governments of the same. we actually work with a lot f anti-corruption and human rights activists in countries around the world who are actually working to try to get their governments to govern more accountable. they're interestedn u.s. standing with them in joining this fight. too often we take such an approach to u.s. assistance, we try to make it -- we focus on much and a boarding corruption these activists in telling us that they want to us stand together to fight corruption which means that we need to be their standing with them in solidarity working together. john: why the need government aid? why the need government aid? >> government said the only tool that can work to solve some of theseccountability problems. it is like asking why t bears need an offensive line. at some point you need these other tools. it will be entrepreneurs who solve the problem of african poverty. but you also need government to do other things. hn: you need governments. >> unfortunately at least in most countries in africa government has been the problem. they basically say, as an entrepreneur government does nothing but slow me down on a regular basis. officials bribing me all along. the fact that my truck is parked on a regular basis. and i have to pay a single time in the delays. john: government aid will help fight the corruption. >> i'm sorry. the more you're feeng this huge government the more you choke me from the other end. that is at least the phenomenon that i am awareness of. and the more you give to them the more that is what happens to me. john: we do think that there is role that government can play. in a lot of the places we actually find there is a government deficit. people have to deal with -- john: why do you believe government aid would provide that? has not so far. >> that is actually not true to a lot of success stories. a lot of african countries that the scene. john: to racine them. thank you. coming up, why our man came up to me on the street and said are you john stossel? i hope you die. they said i couldn't dream. called me a piece of trash and swore that's all i'd ever be. said a bottle couldn't see the ocean. "give up." "go back to the dumpster." but i didn't listen. i made my way. and now... i'm what i've always wanted to be. [waves crashing on beach] ♪ john: someone once came up to me on the street in new york and said, are you john stossel? has said the spd said to my hope you guys in. so what is this hatred about? it turned out he was what people call and anti-poverty lawyer and did things like sue landlords to stop them from evicting people. in his world here in new york capitalism is the enemy, and the only thing that keeps poor people from being totally impressed his government. so because i call for less government and evil. this town, we libertarians are selfish people. and a good guy is called a bleeding heart liberal. so what is this website about? bleeding heart libertarians. talks about social justice and free-market. georgetown university philosophy professor regularly contributes to the site. why? >> the idea is to recapture the soul of libertarianism. what they can and should do is embrace the concept of social justice. john: what does the phrase even mean? i am for social justice. >> right. john: for a lot of people it does not mean anything. it just means socialism. there is a real meaning. course of institutions that you expect other people to live by. john: laws, property rights, family rules come anything like that, one of the tests of those institutions should be that you expect when people live and abide by them attend to produce good consequences for everybody. you can show whether you care about this by asking a question like this. imagine that marxists were right. imagine there re a disaster, they left the overall majority of people destitute. would you still advocate markets? i think most libertarians would say i would at least have some reservations. the fact that they work matters in the justification. if you think that the new advocate whether you know not what philosophers are calling the social justice. john: i'm rand said that do not consider charity a major virtue. selfish. >> what she means is not what most people mean. even if she thinks that i don't think she speaks for most people most are humane, they give to charity, the care that mkets work and their work for everybody. the minimum wage, if you did not think that matter why would you argue that because on one. you don't beat you say that the minimum wage causes unemployment among the most laura will people in society and that is part of the reason to oppose it which means that you care of the consequences for the poor. john: the website, bleeding heart libertarian, categories like advocating nurses caring versus helping. >> this explains what is going on with people when they think that libertarians are selfish. if you are on the lefty probably believe that your policies are the only sensible expression of benevolence. you probably think they must disagree with your values and only care of their pocketbooks. that is never really make sense because we have real arguments but also advocacy is cheap. i advocate that we have a 90% marginal tax rate, income over 100,000, if i advocate that it does not cost me anything. if i give money to charity -- john: governments should have a bigger anti-poverty program. >> that costs you nothing but you get the warm glow of altruism when you say you advocate that. put your money where your mouth is. does it actually does something. i know your concern. if you're advocating taking income from other people or yourself and that is a you do your not really showing me that you care. john: it is easy to be generous with other people's money. that is what politicians do. >> that's right. john: thank you. coming up, my take on real charity. ♪ life an everyday miracle of survival today the future of all life on earth hangs in the balance what happens next depends on us ♪ well you done done me and you bet i felt it ♪ i tried to be chill but you're so hot that i melted ♪ i fell right through the cracks ♪ now i'm trying to get back ♪ before the cool done run out i'll be giving it my bestest ♪ and nothing's going to stop me but divine intervention ♪ i reckon it's again my turn ♪ to win some or learn some ♪ but i won't hesitate no more, no more ♪ it cannot wait, i'm yours ♪ open up your mind and see like me ♪ open up yr plans and damn you're free you'll find that the sky'snd yours ♪ so please don't, please don't, please don t ♪ there's no need to complicate ♪ cause our time is short ♪ this oh, this oh, this is our fate ♪ i yours ♪ john: i used to be pretty cheap. my mom told me, if you don't save your money you will freeze in the dark. so i saved. but when my career took off and i started getting paid money to make speeches i decided to donate the money to charity, and it changed my life. i realize that i like giving money away. it makes me happy. research on what makes people happy backs that up. on average people who give to charity, whether they give them money or just time, they are happier. so death. it is did for us and get for them. though that depends whom you give to. i put on a fake beard and tried begging in new york city. people gave me money. they gave me money when my cardboard sign said thomas and cold, and even gave when i chased it to needed bier. thankou. thank you. john: when they asked givers why they gave people said things like this. >> he looks pretty neat, i suppose. john: i just beg for an hour, but i did well. but did this for an eight hour day and would have made $90 a 23,000 year. tax-free. that is the reason social workers say not to give to beggars. often it is a scam plan very often you are an enabling. by giving cash to subsidize the biggest drug or alcohol habit. by not giving you may encourage them to give real help. a few respectable charities illicit on the streets. but most wer begging o running scams. >> i need your help. i am homeless. john: new york attorney general said this pitch from a group calling itself united homeless is a scam. its director keeps nearly all the money comes bins it on things like his weight watcher bills. i hear you keep most of the money. >> we are meless people. john: the pages it is going to shelters. >> am i supposed to run a nonprofit and not get money? >> all the people donate absolutely know where the money goes. john: it is hard to find out where your charity money really goes. we can check charity rating services like charity navigator. it is better than nothing. the ratings are not perfect. some charities are not perfect, and rating services sometimes did coned. i give my charity money to groups that i can check out myself, a group that rehabs ex-con and attics. i decided they do a good job because i could see these men. they call tm men in blue, ready, willing, able. the clean-air bill york city streets. what is hot is that they do is bring in a step in look cheerful and work fast. i thought whoever is working with these guys has done something right, taught them to take pride in work. i give them money in a couple of other groups that bk and watch. while i give to what i think are good charities, we should not forget about the people of, capitalists, on this once. but job creators do much more good for the world that politicians. and more even than that do-gooders' working for charity. i am delighted that the singer bought of figure that out after spending years calling f government to spend more in foreign-aid flop. now he says the bestope for the four is free markets. >> preaching capital. >> sometimes i hea myself, and i just cannot believe it. commerce is real. just a stopgap. >> commerce and on to panera capitalism takes more peopleut of povty. we know that. john: politicians don't know that many americans don't know it. it is time that they learned. entrepreneurial capitalism takes more people out of poverty and a never well. that is our show. see you next week. ♪ . good night. from meltdown to cover-up, never too earliy it look back, and never too late for government to lose its mind, there were so many options in 2013, it will take more be that one show to part insanity that turns so many you into independence we'll give it our best shot, a look at 201313 to loo2013 tolook forward tonight. on the independents. i am kennedy, blanked by my men of the hour. matt welch, and keep fos
government you're going to be in for an awful long way. john: if they get it may be seen more people will realize there are better ways to give. real charity. that is our show tonight. ♪ >> and now. ♪ john: what is real charity? people are in trouble after a disaster or simply when people are poor. americans instead is to think amount and government help. after all, who will help those people is not government? libertarians argue that private charity would step in. individuals really choosing to help. but with enough of us up? most people say no. that is why liberals like newsday columnist say when it comes to helping the need, that is mostly government's job. >> well, listen, it would be great if people of reachnto their hearts and solved all these will problems. that does not happen. in almost every single case where they're is a government program that exists because the private efforts. when you have 04 enough. john: that is because politicns said they were not enough and we could do better. i would argue that a government did not takes a much of our money the private sector would take care of these problems. >> hold on a second. let's get older americans. the poorest sector of our society. something called social security camelot. medicare came along. all the people really do comparatively fairly well. we had hundred kids spread all across america. those numbers were cut dramatically in spite of the gerous churches and nice people. >> programs are trillions in debt. unsustainable. >> maybe we have to tweak. but you can't throw away the idea. the reality is we need government then there. john: food stamps, a couple billionaires' could find that all program by themselves. and a private charity would be better as saying who really needs the food help and to is giving the system. >> i would love that. you know a billionaire who wants to pay to my think we would welcome that. john: did not step in because you're a big fat government is there. people say, oh, the government does that. >> here i the reality in real life. all these private efforts are really important. generous people. we give a lot of money. when the chips are really down and the big thing happens, the typhoon hits the philippines, we ve the red cross effort. but they don't have an aircraft carrier with marines on board and rescue helicopters. the u.s. mility does. i want them steaming toward the philippines when that's-it's. john: i don't know what will happen. in haiti our government promised billions of dollars, billion of it is not done to the people. the new york times said there were going to build 15,000 alums, latest target fewer than 3,000. >> your argument is that government sometimes does not do a perfect job. i concede that. john: i want to play along perversion of the clip earlier. to myeft-wing colleagues were talking about how after a disaster faith based charities work better and disaster relief and fema. >> there is fema and then there is the faith based fema. >> if you're waiting for the government you are going to be for an awful long wait. >> talking about the government response after the tornado in oklahoma in may. now 30 churches banded together to help much more quickly and did a better job in government. this happened with katrina. fema was turning away walmart. people were trying to get water. sending its water to the wrong place. >> you're right. as you know, i am a native of new orleans. there are some things that the province to well. all those kids, wonderful young people who came down, church groups, they did something much better than government. but they were still an awful lot of things that we needed government. remember how angry folks were. no one said stay away. john: walmart and private charities got there. >> maybe one of the things of the privates can do is be more nimble. if you are talking about rebuilding, i don't think you want the government to take a pass. john: i do. let's talk about the war on poverty. lyndon johnson said he would and poverty. here is where the war began. and sure enough it dropped sharply the first five, seven years after that. to then it stopped improving. >> we teach people to be dependent. th was happening before the war. americans were lifting themselves out of poverty. government continue the progress for five yearsnd then stopped . >> we should have been more generous, done the other things that government can do to help folks. john: government does not teach a dependency. >> i am not here saying government is profit. governme has some bad things, clumsy, bureaucratic. there are things it does really well. hey, privateolks, step up. john: these graphs of the test. can we put these up. john: the recession, but it goes up steadily. two lines referred to one is the number of ople collecting in the other is the cost. we are teaching people to be passive. >> i will grant you that is something we want to avoid. what is the solution from a look at the people ansay we will take your food stamps a way? up for the best. >> limit the program some of the private sector stepped in. one more example is the rise of disability test people. straight out. you have fewereople doing manual labor, medicine is better , and more people are disabled. >> i am with you on that one. john: if you want to get rid of it. >> no, i don't wanto get rid of it. certainly we can look more closely as of the applications. john: cut it way back. there's a place near college of ceer, a government office supposedly to help people find jobs. i went there. people said, there are no jobs. we then went around 40 job offers, 28 and t build positions, one restaurant owner said, i would hire a dozen people live there would just apply. >> i would throw we take nine with no experience in trenton. john: and that the welfare of a steeple told us there are no jobs. >> there plenty of jobs. john: government jobs offices to encourage people to take welfare. as somebody go and ask for help to see if it would help her get a job and they said, no, they just to reach for welfare and food stamps. >> again, it is much smarter to have programs that encourage people to work, don't reward laziness,. john: they all do that. >> i don't know. john: private charities and of any suppression did he tell. >> the answer can be to just cut it back a mechanic? john: get it back. and let the private sector in. we will stop there. thank you. atomize a private charity should replace government. what about the rest of the world? people assume global poverty is a problem. it has to be addressed by government giving out foreign aid or maybe the wind. the u.s. and contradicts the title of my book by saying, yes, we, governments, working together can end poverty in just two years. while. o years. of course 50 years ago lyndon johnson claimed his war on poverty would end poverty in america. the u.n. will do better. ted turner gave him a billion dollars for this. individual governments and squandered nearly a trillion dollars of foreign aid trying to lift people out of poverty in africa. i say squandered because after they spent trillions for income per capita it went down. that is maybe because the foreign aid encourages dependency and african kleptocrats government steal much of the money. whats the alternative? michael fay says he has an answer. what is yours? >> we are going straight to the port. cash transfers from you directly to them. no middleman, no leakage, no hidden costs. john: the charity, and you have raised about $6 million. just given 27,000 people-the thousand dollars each. >> that is exactly right. a thousand for the households. john: this sounds like a stupid idea. they will just spend it and then it won't have any. >> you are not the only one. the truth is there has been about a decade of research that shows the exact opposite. what are these people missing? a lot of them are misng the capital. we have the old expression teach a man to fish. the truth is they don't have fishing poles. john: so you allow them to buy a fishing pole or in this case this may have been a guy who got a motorcycle john: he we transfer phone. if they don't have a phone them john: and it is easier to check up on them. >> we check, call them, talk to them regularly. john: people build metal roofs. the most popular thing. >> no charity. saves income, clean water, was malaria. we did not think of it, they did. john: before they had that they had at that's true fan is bad about a hundred dollars a year. john: instead they can start a business, another person had received training from another charity to be a welder. >> said he was standing there doing nothing. he did not have welding equipment. john: what makes you think this work? >> we have a decade of evidence, we have done our own third-party valuation. we know income goes up a monstrous level goes down, under follows. john: you do another odd thing. none of your charity board members works full-time for your charity. >> here is the great thing. if it is not working i would not lead to -- need to lie the right attitude my job. john: you could be more honest evaluating it. the charimselves. >> well, i think people have passion and often implies evidence. john: i have hard time accepting i just criticize government pro grams because they don't teach people to take care of themselves. i guess giving cash once and knowing that it will keep coming is different. >> a onetime transforming event it does not matter who does it. matters what they do. why buy a cow when the person is to will then. john: to take care of it? look to make the choice. john: i hope it works. i'm glad a lot of these experiments are going on. thank you. if you would like to keep this conversation going go to facebook or twitter and use that has tank. real charity. that people know what you think. coming up, president obama's says the way to help poor people is to give them a free cell phone. ♪ ♪ >> the government will pay for you to have a free cell phone with monthly minutes, no credit check and no deposit requid. john: of free cell phone. 253 minutes. what the deal. this is to help poor people in need a lifeline. that is reasonable. this is a government program that began with ronald reagan. president obama expanded it, of course. and in just four years the costs tripled and will continue rice can. >> a minority. you know. he gave up. , no income, disability. john: the more free stuff you get the more you're eligible to get. but eligible is. what did you do? >> i went to all the welfare offices in manhattan and a couple in brooklyn and found out that there are people of their approach you on the street as the if you have your free phone yet. outside the office. john: private entrepreneur. >> and not on welfare. i told them that. i would like to be buried at think a lot of the people would like to be. but that was enough. they ended up giving me not one, not to, but three free phones. john: the good news is someplace is turned down. >> yeah. they ended up. first of, you are not supposed to have duplicate files which i have already broken and will. there also supposed to check eligibility. they also did not catch the eye and multiple applications and and try to work power to the system again and again. john: and fcc audit, they found 41 percent of the recipients never demonstrated that they were eligible. >> that's about 6 million people. the what you really see is the phone companies have a very perverse incentive to push those bonds and on the seet. they get $9.25 per customer per month for this program. the street vendors -- john: is paid r out of your phone bill. if you bothereto read the fine print, there is something called the universal service charge. this was under rond reagan, make sure everybody and a phone line. universal service. a dollar and two out of every race home built. bison i think that most taxpayers don't know what. i went out and investigated. i didn't know. john: bore people talk to their families. >> the phone companies of the bad guys in this. this is a huge business. the mexican billionaire, one of the richest people in the world. john: he may be the richest. >> csn bill gates compete. but he got in 2011 alone half a billion dollars from this program. so what turned out to be welfare for the poor is actually corporate welfare plan in simple john: and what about my obnoxious question. you don't want to help the poor? >> well, i think maybe there would be justification for a land line. as with a program started out as, but anytime you have perverse incentives for companies to go and no phones combined with the very poor oversight you have to ask yourself, you creating a situation in which fraud and abuse can just compound? that is what we have. john: it should not surprise anyone that government charity is susceptible to fraud. the contractors doing theork. no one's money. the more they give out the more they get to keep. they get a commission on each give away. the cellphone charities, $2 billion. think abouthe hundreds of billions spent on medicare and medicaid. much more from there. people work out with all this stuff. one man alone spent $20 million on this diamond jewelry, also a fleet of luxury cars, one after the other. all of which she got because government paid millions for medical treatment that never happened. government health is just extra susceptible to abuse. >> and is definitely what i found. was surprised that i was able to get three of them in violation a pretty much every program wall, and if i can do i being someone he tells the truth, just a man from the people. actually willing to abuse the program. john: private companies get ripped off. but they have more of an incentive to check. it's their own money. >> that's right. georgia is actually dng reform within the states to try to see if they can mess with that fundamental flaw in incentive structure. there will start charging $5 for consumers. they have 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(vo) so do we, business pro. so do we. gogo national. glike a pro. ♪ john: one of the richest people in the world is warren buffett. is the jeep? he is one of many billionaire sue until recently gave very little to charity. he used his money to try to make more money. he said he would give it away when he died. his fellow billionaire ted turner told me buffett was being cheap. >> she should give some away now john: turner just made a big splash by giving a billion dollars to the wind. now he said he wanted to shame other rich people into giving more. >> what he said is bad and the stupid. john: that was his answer. >> what he should do is take his money and invested. he can help people in the other better way into invested and have the companies in buiing in plans that creating the investme creates jobs and wealth and products for other people. john: really? is it better if a money maker uses money t make more rather than give to charity? i think so. add to that question back to ted turner. >> bill gates says, and get it making money. john: that try to argue this, but he wasn't buying it. john: and i wrong in thinking that i am happy if he gives that the charity? >> when you be happier if he did? you alleges -- this is what people don't like these men. i know your dirty tricks. there is nothing more say. goodbye. i am walking out. john: he did not want to talk about it. let's take that same question to an economist to rise a free-market institute at texas tech. >> i am not bothered if they don't give more of it away. they make their money by making allies that. they are helping people. often that is the best with a can help. john: and then make a profit than they hire people, those jobs live on for years. people use it to educate there kids and feed their family. there is a multiplier. these guys may not even begin dexterity. we know they're good at making money. stick to what your specialty is. >> it's about the results. if leen to do the things that we want them to do. of course the real reason is that creating the products and services that make our lives better, but as a byproduct they create jobs that make other people better off. it is what is fundamentally responsible for the high standard of living we enjoy. john: said most of them, i would say to my don't feel good about all the wealth they create in their business and guiltily ge to charity. even bill gates is now working full time on charity he says he thinks most charity has to come from government. >> a lot of the money that is supporting these causes is coming from the private sector, people like you and less from the government. john: governments are the backbone of this. >> no, no, no. he is good as computers, not it is social policy. just last week had a research paper presented about the great chicago fire of 1871. what happened afterward, there was no fema. it was private charity and civil society organizations the banded together and help get people out of the city who lost their homes, brought in new shelter, clothing. judging from what i was hearing from my work to haggle a lot better than fema of orderin people when they can and cannot go and buts in the process t behalf of. john: a recent edition of forbes magazine, the richest people's list featured philanthropy. so how they are now reading billionaires' by how much they give. a kind of want my heart. let's have a competition. >> there is nothing wrong with people giving money to the causes a thinker valuable. not every gd or service will be produced for profit. some of it can come from this segment of society, and it's fine that we recognize that as long as we don't demonize those who aren't doing it and think there's something wrong with them pursuing profit because there is not. that osmanli makes us better off john: there are these tycoons from previous years cornelius vanderbilt and john d. rockefeller and people who vilify them. they did some charity work. they were evil robbers. >> they fundamentally transformed the lives of americans and raising living standards. rockefeller brought us well and made profits. by the way, he probably is also responsible for saving the whales because he pushed down the price of oil it was no longer profitable to how best to extinction henry ford makes jeep automobiles. it does not matter that is motive was pfits. he made automobiles affordable for the average middle-class american. the same is true of most of these so-called robber barons of the late 19th and early 20th cecentury. john: thank you. up next, if i put on a fake beard and chemistry of people give me mon this is the quicksilver cash back card from capital one. it's not the "juggle a bunch of rotating categories" card. it's not the "sign up for rewards each quarter" card. it's the no-games, no-messing-'round, no-earning-limit-having, do-i-look-like-i'm-joking, turbo-boosting, heavyweight-champion- of-the-world cash back card. thiss the quicksilver cash back card from capital one. unlimited 1.5% cash back on every purchase, everywhere, every single day. now tell me, what's in your wallet? 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[ male announcer ] ask your doctor today if eliquis is right for you. ñ@ç@çpçpçpç÷ñoxmhmhyhyhyhyhy ask your doctor today hey mom? i got the job! you got the job. welcome aboard. i've got a job to do today. have a good first day at wo! narrator: donate to goodwill. help provide job tining in your community. ♪ john: it will come to an end. the sooner the better the billions we spend on foreign aid. much of which is squandered or stolen. i agree with ron paul and his son, the senator. we should stop almost all foreign aid. the one libertarians say that people need angry. >> cut off american assistance to these democratic efforts. pull the eight out. what the heck. less than 1 percent of the entire budget of the united states of america. john: it's pretty close to 1%. $35 million. i say we can't afford that. gregory adams runs of sam's 80 effectively says we should spend more. a giant crity it tries to fight poverty over the world. i say, fine. if you want to do that, you raise the money he believes government out of it. >> the issue is that there are some things that charities just can't do. despite the impact that they have around the world, and we are proud of the worthat we do with money raised from average americans, there is only so much that we can do with our own projects. some places government needs to step in. john: all right. government needs to make sure aids workers and of being murdered on the way to where they're going. and i should say that you don't take government money from the united states. to other countries. but you call for government to spend more on foreign aid. why when so much has been squandered? >> it is important to know that we're calling for more of the right kind of a. john: this is going to be the right kind. >> there are som things that we think the united states governments doing that we think is not a good use of money. particular, food aid is in desperate need of reform. we miss about half of the value of every dollar that we spend because we require it to be shipped in american vessels, delivering food rather than buying food at the source. john: you also wanted to spend more. >> we want more of the right kind. there are good programs, the millennium celebration that invest in success. the best performing countries rather than bsidizing failure. we want to see more aid given directly to helping small farmers grow more of their own food and you want to see more aid used to support the anti-corruption efforts. john: but what are the odds that that will happen? that the aids support the corrupt dictators as much as half the food aid center at the molly is diverted to corrupt ccntractors, is like militants, local un staff. >> somaliaia is a difficult environment. john: i will go on. zimbabwean authorities confiscated truck filled with american food aid for school kids and handed it out to supporters of president robert mcgowan boy and a political rally. >> this is one of the problems when the only tool you have is bags of food. john: but by calling for more government aid you are calling for more of the aid that despite all the promises of reform has ended up in the hands of corrupt dictators. >> we are not just calling for more government aid. john: i understand that, and you do some brave work. why do you call for it at all? >> a lot of misconceptions. one of the biggest is that most u.s. assistance actually goes to governments. in fact, that is not true. most gs to u.s. based charities, ngos, contractors. john: and the u.n. >>here is portion that goes. we are very clear that they are not the solution. people on the solution to poverty. john: let's hear from an african entrepreneur. a business and american. but she tried operating a business in her own company -- country of senegal. you agree. >> the combination. foreign aid. government. >> i have a very hard time. the african union itself is admitting it is being siphoned through corruption. john: the swiss bank account. >> swiss bank accounts, real estates in the south of france, the son of the dictator of a equatorial guinea. he was busted by french customs. his planas intercepted, and they found in the plane 27 fancy cars. i don't know how many furry some bentleys, rolls-royces. john: the only way to stop that is said kee government out of it. you can get a bunch of people who want to give their own money they won't give it to dictators. >> well, not of governments of the same. we actually work with a lot of anti-corruption and human rights activists in countries around the world who are actually working to try to get their governments to govern more accountable. they're interested in u.s. standing with them in joining this fight. too often we take such an approach to u.s. assistance, we try to make it -- we focus on much and a boarding corruption these activists telling us that they want to us stand together to fight corruption which means that we need to b their standing with them in solidarity working together. john: why the need government aid? why the need government aid? >> government said the only tool that can work to solve some of these accountability problems. it is like asking why the bears need an offensive line. at some point you need these other tools. it will be entrepreneurs who solve the problem of african poverty. but you also need government to do other things. john: you need governments. >> unfortunately at least in most countries in africa government has been the problem. they basically say, as an entrepreneur government does nothing but slow me down on a regular basis. officials bribing me all along. the fact that my truck is parked on a regular basis. and i have to pay a single time in the delays. john: government aid will help fight the corruption. >> i'm sorry. the more you're feeding this huge government the more you choke me from the other end. that is at least the phenomenon that i am awareness of. and the more you give to them the more that is what happens to me. john: we do think that there is role that government can play. in a lot of the places we actually find there is government deficit. people have to deal with -- john: why do you believe government aid would provide that? has not so far. >> that is actually not true to a lot of success stories. a lot of african countries that the scene. john: to racine them. thank you. coming up, why our man came up to me on the street and said are you john stossel? i hope you die. ♪ [ male announcer ] if we could see energy... what would we see? ♪ the billions of gallons of fuel that get us to work. ♪ we'd see all the electricity flowing through the devices that connect us and teach us. ♪ we'd see thatlmost 100% of medical plastics are made from oil and natural gas. ♪ anan industry that supports almost 10 million americanobs. life takes energy. and no one applies more technology to produce american energy and refine it more efficiently than exxonmobil. because using energy responsibly has never been more important. energy lives here. ♪ energy lives here. i need you. i feel so alone. but you're not alone. i knew you'd come. like i could stay away. you know i can't do this without you. you'll never have to. you're always there for me. shh! i'll get you a rental car. i could also use an umbrella. fall in love with progressive's claimservice. ♪ john: someone once came up to me on the street in new york and said, are you john stossel? has said the spd said to my hope you guys in. so what is this hatred about? it turned out he was what people call and anti-poverty lawyer and did things like sue landlords to stop them from evicting people. in his world here in new york capitalism is the enemy, and the only thing that keeps poor people from being totally imessed his government. so because i call for less government and evil. this town, we libertarians are selfish people. and a good guy is called a bleeding heart liberal. so what is this website about? bleeding heart libertarians. talks about social justice and free-market. georgetown university philosophy professor regularly contributes to the site. why? >> the idea is tore the soul of libertarianism. what they can and should do is embrace the concept of social justice. john: what does the phrase even mean? i am for social justice. >> right. john: for a lot of people it does not mean anything. it just means socialism. there is a real meaning. course of institutions that you expect other people to live by. john: laws, property rights, family rules come anything like that, one of the tests of those institutions should be that you expect when people live and abide by them attend to produce good consequences for everybody. you can show whether you care about this by asking a question like this. imagine that marxists were right. imagine there were a disaster, they left the overall majority of people destitute. would you still advocate markets? i think most libertarians would say i wou at least have some reservations the fact that they work matters in the justification. if you think that the new advocate whether you know not what philosophers are calling the social justice. john: i'm rand said that do not consider charity a major virtue. selfish. >> what she means is not what most people mean. even if she thinks that i don't think she speaks for most people most are humane, they give to charity, the care that markets work and their work for everybody. the minimum wage, if you did not think that matter why would you argue that because on one. you don't beat you say that the minimum wage causes unemployment among the most laura will people in society and that is part of the reason to oppose it which means that you care of the consequences for the poor. john: the website, bleeding heart libertarian, categories like advocating nurses caring versus helping. >> this explains what is going on with people when they think that libertarians are selfish. if you are on the lefty probably believe that your policies are the only sensible expression of benevolence. you probably think they must disagree with your values and only care of their pocketbooks. that is never really make sense because we have real arguments but also advocacy is cheap. i advoce that we have a 90% marginal tax rat, income over 100,000, if i advocate that it does not cost me anything if i give money to charity -- john: governments should have a bigger anti-poverty program. >> that costs yonothing but you get the warm glow of altruism when you say you advocate that. put your money where your mouth is. does it actually does something. i know your concern. if you're advocating taking income from other people or yourself a that is all you do your not really showing me that you care. john: it is easy to be generous with other people's money. that is what politicians do. >> that's right. john: thank you. coming up, my take on real charity. ♪ [ male announcer ] this store knows how to handle a saturday crowd. ♪ [ male announcer ] the parking lot helps by letting us know who's coming. the carts keep everyone on the right track. the power tools iroduce themselves. all the bits and bulbs keep themselves stocked. and the doors even handle the checkout so we can work on that thing that's stuck in the thing. [ female announcer ] today, cisco is connecting the internet of everything. so everyone goes home happy. ♪ john: i used to be pretty cheap. my mom told me, if you don't save your money you will freeze in the dark. so i saved. but when my career took off and i started getting paid money to make speeches i decided to donate the money to charity, and it changed my life. i realize that i like giving money away. it makes me happy. research on what makes people happy backs that up. on average people who give to charity, whether they give them money or just time, they are happier. so death. it is did for us and get for them. though that depends whom you give to. i put on a fake beard and tried begging in new york city. people gave me money. they gave me money when my cardboard sign said thomas and cold, and even gave when i chased it to needed bier. thank you. thank you. john: when theysked givers why they gave people said things like this. >> he looks pretty neat, i suppose. john: i just beg for an hour, but i did well. but did this for an eight hour day and would have made $90 a ,000 year. tax-free. that is the reason social workers say not to give to beggars. often it is a scam plan very often you are an enabling. by giving cash to subsidize the biggest drug or alcohol habit. by not giving you may encourage them to give real help. a few respectable charities illicit on the streets. but most were begging or running scams. >> i need your help. i am homeless. john: new york attorney general said this pitch from a group calling itself united homeless is a scam. its director keeps nearly all the money comes bins it on things like his weight watcher bills. i hear you keep most of the money. >> we are homeless people. john: the pages it is going to shelters. >> am i supposed to run a nonprofit and not get money? >> all the people donate absolutely know where the money goes. john: it is hard to find out where your charity money really goes. we can check charity rating services like charity navigator. it is betterhan nothing the ratings are not perfect. some charities are not perfect, and rating services sometimes did coned. i give my charity money to groups that i can check out myself, a group that rehabs ex-con and attics. i decided they do a good job because i could see these men. they call them men in blue, ready, willing, able. the clean-air bill york city streets. what is hot is that they do is ing in a step in look cheerful and work fast. i thought w whoever is working with these guys has done something right, taught them to take pride in work. i give them money in a couple of other groups that back and watch. while i give to what i think are good charities, we should not forget about the people of, capitalists, on this once. but job creators do much more good for the world that politicians. and more even than that do-gooders' working for charity. i am delighted that the singer bought of figure that out after spending years calling for government to spend more in foreign-aid flop. now he says the best hope for the four is free markets. >> preaching capital. >> sometimes i hear myself, and i just cannot believe it. commerce is real. just a stopgap. >> commerce and on to panera capitalism takes more people out of poverty. we know that. john: politicians don't know that. many americans don't know it. it is time that they learned. entrepreneurial capitalism takes more people out of poverty and a never well. that is our show. see you next week. ♪ see you next week. jeff: jeff flock here. >> this week on across america, we go kayaking and fishing with one of the wealthiest and most successful women in america. >> we take an inside look at america's most storied office furnituremaker. what happens when a 300 pound person sits on a miller chair for three years? this machine is finding out. we unveiled the newest and fanciest outlet mall in america and get the wisdom of the visionary who started building it in the worst recession in
government you're going to be in for an awful long way. john: if they get it may be seen more people will realize there are better ways to give. real charity. that is our show tonight. ♪ >> and now. ♪ john: what is real charity? people are in trouble after a disaster or simply when people are poor. americans instead is to think amount and government help. after all, who will help those people is not government? libertarians argue that private charity would step in. individuals really choosing to help. but with enough of us up? most people say no. that is why liberals like newsday columnist say when it comes to helping the need, that is mostly government's job. >> well, listen, it would be great if people of reach into their hearts and solved all these will problems. that does not happen. in almost every single case where they're is a government program that exists because the private efforts. when you have 04 enough. john: that is because politicians said they were not enough and we could do better. i would argue that a government did not takes a much of our money the private sector would take care of these problems. >> hold on a second. let's get older americans the poorest sector of our society. something called social security camelot. medicare came along. all the people really do comparatively fairlyell. we had hundred kids spread all across america. those numbers were cut dramatically in spite of the generous churches and nice people. >> programs are trillions in debt. unsustainable. >> maybe we have to tweak. but you can't throw away the idea. the reality is we need government then there. john: food stamps, a couple billionair' could find that all program by theelves. and a private charity would be better as saying who really needs the food help and to is giving the system. >> i would love that. you know a billionaire who wants to pay to my think we would welcome that. john: did not step in because you're a big fat government is there. people say, oh, the government does that. >> here is the reality in real life. all these private efforts are really important. generous people. we give a lot of money. when the chips are really down andhe big thing happens, the typhoon hits the philippines,e love the red cross effort. but they don't have an aircraft carrier with marines on board and rescue helicopters. the u.s. military does. i want them steamin toward the philippines when that's-it's. john: i don't know what will happen. in haiti our government promised billions of dollars, billion of it is not done to the people. the new york times said there were going to build 15,000 alums, latest target fewer than 3,000. >> your argument is that government sometimes does not do a perfect job. i concede that. john: i want to play along perversion of the clip earlier. to my left-wing colleagues were talking about how after a disaster faith based charities work better and disaster relief and fema. >> there is fema and then there is the faith based fema. >> if you're waiting for the government you are going to be in for an awl long wait. >> talking about the government response after the tornado in oklahoma in may. now 30 churches banded together to help much more quickly and did a better job in government. this happened with katrina. fema was turning away walmart. people were trying to get water. sending its water to the wrong place. >> you're right. as you know, i am a native of new orleans. there are some things that the province to well. all those kids, wonderful young people who came down, church groups, they did something muc better than government. but they were still an awful lot of things that we needed government. remember how angry folks were. no one said stay away. john: walmart and private charities got there. >> maybe one of the things of the privates can do is be more nimble. if you are talking about rebuilding, i don't think you want the government to take a pass. john: i do. let's talk about the war on poverty. lyndon johnson said he would and poverty. here is where the war began. and sure eugh it dropped sharply the first five, seven years after that. to then it stopped improving. >> we teach people to be dependent. that was happening before the war. americans were lifting themselves out of poverty. government continue the progress for five years and then stopped it. >> we should have been more generous, done the other things that government can do to help folks. john: government does not teach a dependency. >> i am not here saying government is profit. government has some bad things, clumsy, bureaucratic. there are things it does really well. hey, private folks, step up. john: these graphs of the test. can we put these up. john: the recession, but it goes up steadily. two lines referred to one is the number of people collecting in the other is the cost. we are teaching people to be passive. >> i will grant you that is something we want to avoid. what is the solution from a look at the people and say we will take your food stamps a way? up for the best. >> limit the program some of the private sector stepped in. one more example is the rise of disability test people. straight out. you have fewer people doing manual labor, medicine is better , a more people are disabled. >> i am with you on that one. john: if you want to get rid of it. >> no, i don't want to get rid of it. certainly we can look more closely as of the applications. john: cut it way back. there's a place near college of center, a government office supposedly to help people find jobs. i went there. people said, there are no jobs. we then went around 40 job offers, 28 and to build positions, one restaurant owner said, i would hire a dozen people live there would just apply. >> i would throw we take nine with no experience in trenton. john: and that the welfare of a steeple told us there are no jobs. >> there plenty of jobs. john: government jobs offices to encourage people to take welfare. as somebody go and ask for help to see if it would help her get a job and they sd, no, they just to reach for welfare and food stamps. >> again, it is mucsmarter to have programs that encourage people to work, don't reward laziness,. john: they all do that. >> i don't know. john: private charities and of any suppression did he tell. >> the answer can be to just cut it back a mechanic? john: get it back. and let the private sector in. we will stop there. thank you. atomiz a private charity should replace government. what about the rest of the world? people assume global poverty is a problem. it has to be addressed by government giving out foreign aid or maybe the wind. the u.s. and contradicts the title of my book by saying, yes, we, governments, working together can end poverty in just two years. while. two years. of course 50 years ago lyndon johnson claimed his war on poverty would end poverty in america. the u.n. will do better. ted turner gave him a billion dollars for this. individual governments and squandered nearly a trillion dollars of foreign aid trying to lift people out of poverty in africa. i say squandered because after they spent trillions for income per capita it went down. that is maybe because the foreign aid encourages dependency and african kleptocrats government steal much of the money. what is the alternative? michael fay says he has an answer. what is yours? >> we are going straight to the port. cash transfers from you directly to them. no middleman, no leakage, no hidden costs. john: the charity, and you have raised about $6 million. just given 27,000 people-the thousand dollars each. >> that is exactly right. a thousand for the households. john: this sounds like a stupid idea. they will just spend it and then it won't have any. >> you are not the only one. the truth is there has been about a decade of research that shows the exact opposite. what are these people missing? a lot of them are missing the capital. we have the old expression teach a man to fish. the truth is they don't have fishing pol. john: so you allow them to buy a fishing pole or in this case this may have been a guy who got a motorcycle and use it for a taxi service. >> this is a used motorcycle that he bought with cash and now provides tax to services. john: he gives the people a cell phone with the money. >> that is the way we transfer the money. found the phone. if they don't have a phone them in a deal to get the money. john: and it is easier to check up on them. >> we check, call them, talk them regularly. john: people build metal roofs. the most popular thing. >> no charity. saves income, clean water, was malaria. we did not think of it, they did. john: before they had that they had at that's true fan is bad about a hundred dollars a year. john: instead they can start a business, another person had received training from another charity to be a welder. >> said he was standing there doing nothing. he did not have welding equipment. john: what makes you think this work? >> we have a decade of evidence, we have done our own third-party valuation. we know income goes up a monstrous level goes down, under follows. john: you do another odd thing. none of your charity board members works full-time for your charity. >> here is the great thing. if it is not working i would not lead to -- need to lie the right attitude my job. john: you could be more honest evaluating it. the charities delude themselves. >> well, i think people have passion and often implies evidence. john: i have hard time accepting i just criticize government pro grams because they don't teach people to take care of themselves. i guess giving cash once and knowing that it will keep coming is different. >> a onetime transforming event it does not matter who does it. matters what they do. why buy a cow when the person is to will then. john: to take care of it? look to make the choice. john: i hope it works. i'm glad a lot of these experiments are going on. thank you. if you would like to keep this conversation going go to facebo o twitter and use that has tank. real charity. that people know what you think. coming up, president obama's says the way to help poor people is to give them a free cell phone. ♪ ñ@ç@çpçpçpç÷ñoxmhmhyhyhyhyh ♪ >> the government will pay for you to have a free cell phone with monthly minutes, no credit check and no deposit required. john: of free cell phone. 253 minutes. what the deal. this is to help poor people in need a lifeline. that is reasonable. this is a government program that began with ronald reagan. president obama expanded it, of course. and in just four years the costs tripled and will continue rice can. >> a minority. you know. he gave up. , no income, disability. john: the more free stuff you get the more you're eligible to get. but eligible is. what did you do? >> i went to all the welfare offices in manhattan and a couple in brooklyn and found out that there are people of their approach you on the street as the if you have your free phone yet. outside the office. john: private entrepreneur. >> and not on welfare. i told them that. i would like to be buried at think a lot of the people would like to be. but that was enough. they ended up giving me not one, not to, but three free phones. john: the good news is someplace is turned down. >> yeah. they ended up. first of, you are not supposed to have duplicate files which i have already broken and will. there also supposed to check eligibility. they also did not catch the eye and multiple applications and and try to work power to the system again and again. john: and fcc audit, they found 41 percent of the recipients never demonstrated that they were eligible. >> that's about 6 million people. the what you really see is the phone companies have a very perverse incentive to push those bonds and on the street. they get $9.25 per customer per mont for this program. the street vendors -- john: is paid for out of your phone bill. if you bothered to read the fine print, there is something called the universal serviceharge. this was under ronald reagan, make sure everybody and a phone line. universal service. a dollar and two out of every race home built. bison i think that most taxpayers don't know what. i went out and investigated. i didn't know. john: bore people talk to their families. >> the phone compani of the bad guys in this. thiss a huge business. the mexican billionaire, one of the richest people in the world. john: he may be the richest. >> csn bill gates compete. but he got in 2011 alone half a billion dollars from this program. so what turned out to be welfare for the poor is actually corporate welfare plan in simple john: and what about my obnoxious question. you don't want to help the poor? >> well, i think maybe there would be justification for a land line. as with a program started out as, but anytime you have perverse incentives for companies to go and no phones combined with the very poor oversight you have to ask yourself, you creating a situation in which fraud and abuse can just compound? that is what we have. john: it should not surprise anyone that government charity is susceptible to fraud. the contracto doing the work. no one's money. the more they give out the more they get to keep. they get a commission on each give away. the cellphone charities, $2 billion. think about the hundreds of billions spent on medicare and medicaid. much more from there. people work out with all this stuff. one man alone spent $20 million on this diamond jewelry, also a fleet of luxury cars, one after the other. all of which she got because government paid millions for medical treatment that never happened. governnt health is just extra susceptible to abuse. >> and is dinitely what i found. was surprised that i was able to get three of them in violation a pretty much every program wall, and if i can do it being someone he tells the truth, just a man from the people. actually willing to abuse the program. john: private compani get ripped off. but they have more of an incentive to check. it's their own money. >> that's right. georgia is actually doing reform within the states to try to see if they can mess with that fundamental flaw in incentive structure. there will start charging $5 for consumers. they have to pay $5 spirit there less likely to god and by. john: thank you. coming up, better ways tell people. ♪ ♪ john: one of the richest people in the world is warren buffett. is the jeep? he is one of many billionaire sue until recently gave very little to charity. he used his money to try to make more money. he said he wouldive it away when he died. his fellow billionaire ted turner told me buffett was being cheap. >> she should giv some away now john: turner just made a big splash by giving a billion dollars to the wind. now he said he wanted to shame other rich people into giving more. >> what he said is bad and the stupid. john: that was his answer. >> what he should do is take his money and invested. he can help people in the other better way into invested and have the companies in building in plans that creating the investment creates jobs and wealth and products for other people. john: really? is it better if a money maker uses money to make more rather than give to charity? i think so. add to that question back to ted turner. >> bill gates says, and get it making money. john: that try to argue this, but he wasn't buying it. john: and i wrong in thinking that i am happy if he gives that the charity? >> when you be happier if he did? you alleges -- this is what people don't like these men. i know your dirty tricks. there is nothing more say. goodbye. i am walking out. john: he did not want to talk about it. let's take that same question to an economist to rise a free-market institute at texas tech. >> i am not bothered if they don't give more of it away. they make their money by making allies that. they are helping people. often that is the best with can help. john: and then make a profit than they hire people, those jobs live on for years. people use it to educate there kids and feed their family. there is a multiplier. these guys may not even begin dexterity. we know they're good at making money. stick to what your specialty is. >> it's about the results. if leeson to do the things that we want them to do. of course the real reason is that creating the products and services that make our lives better, but a a byproduct they create jobs that make other people better off. it is what is fundamentally reonsible for the high standard of living we enjoy. john: said most of them, i would say to my don't feel good about al the wealth they create in their business and guiltily give to charity. even bill gates is now working full time on charity he says he thinks most charity has to come from government. >> a lot of the money that is supporting these causes is coming from the private sector, people like you and less from the government. john: governments are the backbone of this. >> no, no, no. he is good as computers, not it is social policy. just last week had a research paper presented about the great chicago fire of 1871. what happened afterward, there was no fema. it was private charity and civil society organizations the banded together and help get people out of the city who lost their homes, brought in newhelter, clothing. judging from what i was hearing from my work to haggle a lot better than fema of ordering people when they can and cannot go and buts in the process to behalf of. john: a recent edition of forbes magazine, the richesteople's list featured philanthropy. so how they are now reading billionaires' by how much they give. a kind of want my heart. let's have a competition. >> there is nothing wrong with people giving money to the causes a thinker valuable. not every good or service will be produced for profit. some of it can come from this segment of society, and it's fine that we recognize that as long as we don't demonize those wharen't doing it and think there's something wrong with them pursuing profit because there is not. that osmanli makes us better off john: there are these tycoons from previous years cornelius vanderbilt and john d. rockefeller and people who vilify them. they did some charity work. they were evil robbers. >> they fundamentally transformed the lives of americans and raising living standards. rockefeller brought us well and made profits. by the way, he probably is also responsible for saving the whales because he pushed down the price of oil it was no longer profitae to how best to extinction henry ford makes jeep automobiles. it does not matter that is motive was profits. he mad automobiles affordable for the average middle-class american. the same is true of most of these so-called robber barons of the late 19th and early 20th century. john: thank you. up next, if i put on a fake beard and chemistry of people give me mon this is the quicksilver cash back card from capital one. it's not the "fumbling around with rotating categories" card. it's not the etting blindsided by limits" card. it's the no-game-playing, noarning-limit-having, deep-bomb-throwing, give-me-the-ball-and-i'll-take- it-to-the-house, cash back card. this is the quicksilver cash card from capital one. unlimited 1.5% casback on every purchase, everywhere, every single day. so let me ask you... at's in your wallet? ♪ john: it will come to an end. the sooner the better the billions we spend on foreign aid. much of which is squandered or stolen. i agree with ron paul and his son, the senator. we should stop almost all foreign aid. the one libertarians say that people need angry. >> cut off american assistance to these democratic efforts. pull the eight out. what the heck. less than 1 percent of the entire budget of the united states of america. jo: it's pretty close to 1%. $35 million. i say we can't afford that. gregory adams runs of sam's 80 effectively says we should spend more. a giant chari i trieso fight poverty over the world. i say, fine. if you want to do that, you raise the money he believes government out of it. >> the issue is that there are some things that charities just can't do. despite the impact that they have around the world, and we are proud of the work that we do with money raised from average americans, there is only so much that we can do wit our own projects. some places government needs to step in. john: all right. government needs to make sure aids workers and of being murdered on the way to where they're going. and i should say that you don't take government money from the united states. to other countries. but you call for government to spend more on foreign aid. why when so much has been squandered? >> it is important to know that we're calling for more of the right kind of a. john: this is going to be the right kind. >> there are some things that we think the united states government is doing that we think is not a good use of money. particular, food aid is in desperate nd of reform. we miss about half of the value of every dollar that we spend because we require it to be shipped in american vessels, delivering food rather than buying food the source. john: you also wanted to spend more. >> we want more of the right kind. there are good programs, the millennium celebration that invest in success. the best performg countries rather than subsidizing failure we want to see more aid given directly to helping small farmers grow more of their own food and you wan to see more aid used to support the anti-corruption efforts. john: but what are the odds that that will happen? that the aids support the corrupt dictators as much as half the food aid center at the molly is diverted to corrupt ccntractors, is like militants, local un staff. >> somalia is a difficult environment. john: i will go on. zimbabwean authorities confiscated truck filled with american food aid for school kids and handed it out to supporters of president robert mcgowan boy and a political blems when the only tool you have is bags of food. john: butgovernment aid you areg for more of the aid thatesall ts ended up in the hands of corrupt dictators. >> we are not just calling for more government aid. john: i understand that, and you do some brave work. why do you call for it at all? >> a lot of misconceptions. one of the biggest is that most u.s. assistance actually goes to governments. in fact, that is not true. most goes to u.s. based charities, ngos, contractors. john: and the u.n. >> there is portion that goes. we are very clear that they are not the solution. people on the solution to poverty. john: let's hear from an african entrepreneur. a business and american. but she tried operating a business in her own company -- country of senegal. you agree. >> the combination. foreign aid. government. >> i have a very hard time. the african union itself is admitting it is being siphoned through corruption. john: the swiss bank account. >> swiss bank accounts, real estates the south of france, the son of the dictator of a equatorial guinea. he was busted by french customs. his plan was intercepted, and they found in the plane 27 fancy cars. i don't know how many furry some bentleys, rolls-royces. john: the only way to stop that is said keep government out of it. you can get a bunch of people who want to give their own money they won't give it to dictators. >> well, not of governments of the same. we actually work with a lot of anti-corruption and human rights activists in countries around the world who are actually working to try to get their governments to govern more accountable. they're interested in u.s. standing with them in joining this fight. too often we take such an approach to u.s. assistance, we try to make it -- we focus on much and a boarding corruption these activists in telling us that they want to us stand together to fight corruption which means that we need to be their standing with them in solidarity working together. john: why the need government aid? why the need government aid? >> government said the only tool that can work to solve some of these accountability problems. it is like asking why the bears need an offensive line. at some point you need these other tools. it will be entrepreneurs who solve the problem of african poverty. but you also need government to do other things. john: you need governments. >> unfortunately at lea in most countries in africa government has been the problem. they basically say, as an entrepreneur government does nothing but slow me down on a regular basis. officials bribing me all along. the fact that my truck is parked on a regular basis. and i have to pay a single time in the delays. john: government aid will help fight the corruption. >> i'm sorry. the more you're feeding this huge government the more you choke me from the other end. that is at least the phenomenon that i am awareness of. and the more you give to them the more that is what happens to me. john: we do think that there is role thatovernment can play. in a lot of the places we actually find there is a government deficit. people have to deal with -- john: why do you believe government aid would provide that? has not so far. >> that is actually not true to a lot of success stories. a lotf african countries that the scene. john: to racine them. thank you. coming up, why our man came up to me on the street and said are you john stossel? i hope you die. ♪ john: someone once came up to me on the street in new york and said, are you john stossel? has said the spd said to my hope you guys in. so what is this hatred about? it turned out he was what people call and anti-poverty lawyer and did things like sue landlords to stop them from evicting p capitalism the enemy, and the only thing that keeps poor people from being total nt and evil. this town, we libertarians are selfish people. and a good guy is called a bleeding heart liberal. so what is this website about? bleeding heart libertarians. talks about social justice and free-market. georgetown university philosophy professo why? >> the idea is to recapture the soul of libertarianism. what they can and shouldo embrace the concept of social justice. john: what does the phrase even justice. >> right. john: for a lot of people itdoe. it just means socialism. there is a real meaning. course of institutions that you expect other people to live by. john: laws, property rights, family rules come anything likee institutions should be that you expect when people live and abide by them attend to produce good consequences for everybody. you can show whether you care about this by asking a question like this. imagine that marxists were right. imagine there were a disaster, they left the overall majority of people destitute. would you still advocate markets? i think most libertarians would say i would at least have some reservations. the fact that they work matters in the justification. if you think that the new advocate whether you know not what philosophers are calling the social justice. john: i'm rand said that do not consider charity a major virtue. selfish. >> what she means is not what most people mean. even if she thinks that i don't think she speaks for most people most are charity, the care that markets work and their work for everybody. the minimum wage, if you did not think that matter why would you argue that because on one. you don't beat you say that the minimum wage causes unemployment among the most laura will people in society and that is part of the reason to oppose it which means that you care of the consequences for the poor. john: the website, bleeding heart libertarian, categories like advocating nurses caring versus helping. >> this explains what is going on with people when they think that libertarians are selfish. if you are on the leftyrobably believe that your policies are the only sensible expression of benevolence. our values andhink they must only care of their pocketbooks. that is never really make sense because we have real arguments but also advocacy is cheap. i advocate that we have a 90% marginal tax rate, income over 100,000, if i advocate that it does not cost me anything. if i give money to charity -- john: governments should have a bigger anti-poverty program. >> that costs you nothing but you get the warm glow of altruism when you say you advocate that. put your money where your mouth is. does it actually does something. i know your concern. if you're advocating taking income from other people or yourself and that is all you do your not really showing me that you care. john: it is easy to be generous with oer people's money. that is what politicians do. >> that's right. john: thank you. coming up,y take on real charity. ♪ i was late for everything. i would forget really important information my friends told me. i didn't see my peers having the same difficulties that i did. and when my professor approached me about my constant lateness, i knew i had to do something. so i talked to my doctor. and it turns out, i have adhd. a lot of my friends seemed to have no problem keeping a planner and going to class on time. i couldn't organize anything in an efficient way. if this sounds familiar, ... ...or if you had adhd as a kid and thought you outgrew it, ... ...find out more. take a quiz at ownyouradhd.com, to help recoize the symptoms ...like inattention, impulsivity, and hyperactivity. then talk with your doctor. i don't feel that it's anything to be ashamed about. i have adhd. that doesn't mean that it's all that i'm about. it's your adhd. own . ♪ john: i used to be pretty cheap. my mom told me, if you don't save your money you will freeze in the dark. so i saved. but when my career took off and i started getting paid money to make speeches i decided to donate the money to charity, and it changed my life. i realize that i like giving money away. it makes me happy. research on what makes people happy backs that up. on average people who give to charity, whether they give them money or just time, they are happier. so death. it is did for us and get for them. though that depends whom you give to. i put on a fake beard and tried begging in new york city. people gave me money. they gave me moneyey when my cardboard sign said thomas and cold, and even gave when i chased it to needed bier. thank you. thank you. john: when they asked givers why they gave people said things like this. >> he looks pretty neat, i suppose. john: i just beg for an hour, but i did well. but did this for an eight hour day and would have made $90 a 23,000 year. tax-free. that is the reason social workers say not to give to beggars. often it is a scam plan very often you are annabling. giving cash to subsidize the biggest drug or alcohol habit. by not giving you may encourage them to give real help. a few respectable charities illicit on the streets. but most were begging or running scams. >> i need your help. i am homeless. john: new york attorney general said this pitch from a group calling itself united homeless is a scam. its director keeps nearly all the money comes bins it on things like his weight watcher bills. i hear you keep most of the money. >> we are homeless people. john: the pages it is going to shelters. >> am i supposed to run a nonprofit and not get money? >> all the people donate absolutely know where the money goes. john: it is hard to find out where your charity money really goes. we can check charity rating services like charity navigator. it is better than nothing. the ratings are not perfect. some charities are not perfect, and rating services sometimes did coned. i give my charity money to groups that i can check out myself, a group that rehabs ex-con and attics. i decided they do a good job because i could see these men. they call them men in blue, ready, willing, able. the clean-air bill york city streets. what is hot is that they do is bring in a step in look cheerful and work fast. i thought whoever is working with these guys has done something right, taught them to take pride in work. i give them money in a couple of other groups that back and watch. while i give to what i think are good charities, we should not forget about the people of, capitalists, on this once. but job creators do much more good for the world that politicians. and more even than that do-gooders' working for charity. i am delighted that the singer bought of figurthat out after spending years calling for government to spend more in foreign-aid flop. now he says the best hope for the four is free markets. >> preaching capital. >> sometimes i hear myself, and i just cannot believe it. commerce is real. just a stopgap. >> commerce and on to panera capitalism takes more people out of poverty. we know that. john: politicians don't know that. many americans don't know it. it is time that they learned. entrepreneurial capitalism takes more people out of poverty and a never well. that is our show. see you next week. ♪ > happy birthday! it's been a ockin' year for stocks and signs the economy is starting to pick up, but are they both about to get socked when the ball drops and the new obamacare taxes and fees kick in? hi, everyone. this is "bulls and bears." get les get right to it. we have gary b. smith, tracy burns, jonas ferras and david mercer. welcome to everybody. tracy, new taxes and fees from the health care law hitting in the new year. will they hit the market and the economy? >> they most certainly will. what a culture sck this is going to be. first, when you sit down to do your 2013 tax return come april, you