That ive been thinking about for a really long time. Before i was a fulltime author, i was a High School Computer science teacher. I taught for 17 years at a high school in oakland, and i would teach in this really visual way. I would do a lot of drawing on the board to explain to my students. I always thought, man, a lot of this could really work well in a graphic novel series. I teamed up with a friend of mine named mike holmes, and together we are trying to introduce fundamental Computer Science concepts to middle school kids through comics. Host how did you go from a High School Teacher to a National Book award nominee . [laughter] guest its kind of crazy. Each when i was a fulltime teacher, i would do comics at night, in the morning, in the summers host did you think they could be published . Guest it was for me. Host really . Guest i never thought itd be a source of income. Some people, you know, play golf to relax, and that costs a lot of money. Im going to publish comics to relax. So to go from there to here has been a dream come true. Host when where was that moment when you said im done teaching, i think i can do this . Guest well, for a really long time i really i love teaching, you know . Im as much of a teacher as i am a cartoonist. So for a really long time, i tried to hang onto both. My last year at that school i was only teaching one period, but with the travel schedule that comes with being an author, it got too crazy. Id end up missing two or three sessions with my students, and i just couldnt hang on. Once things calm down, i want to get back into some sort of teaching environment. Host im going to put you on the spot. Two or three graphic novels that every kid should read. Guest i think smile is a great one for a younger student. My own daughters love that book. All of my kids, actually, but especially my daughters connect very well. Host whos the author . Raina [inaudible] and then if you only read one graphic novel ever, it should be mouth by art spiegelman. Host gene yang is the library of Congress National ambassador for young peoples literature, also coauthor of a new series of books called secret coders. Gene, thank you so much. Guest thank you. This was a pleasure. This is booktv on cspan2. Television for serious readers. Heres our prime time lineup. Tonight starting at 6 15, Jeremy Scahill and calf member bees of the intercept concern Staff Members of the intercept report on the u. S. Governments drone warfare program. At eight, mary roach talks about her book, grunt the curious science of humans at war. On aftercards at 9 p. M. Eastern, eric fehr recalls his time as an interrogator at abu ghraib prison. And at 10 p. M. , a look at the strained relationship between fdr and winston churchill. We wrap up our sunday prime time with John Hickenlooper at 11 00 eastern the colorado governor remembers his path to public office. That all happens tonight on cspan2s booktv. [inaudible conversations] were going to get started. I have a lot of books to mention, so i want to make sure i get them right. Sorry were starting late. Thanks for being here and especially to the folks on our panel, mark, george and steve, were really pleased that youre here. The last theres been a lot of talk about that over the last generation, maybe the last 40 years really highlights the challenges of measuring economic values. A lot of people take view that there hasnt been much progress, much growth in incomes, economic stagnation over that period of time. And i often try to put the lie to that assertion by asking people whether theyre low income, middle income, high income, raise your hand if you want to go back to 1975. And there usually arent a lot of takers. But one thing is undeniable over the last 10 or 15 years, we truly have been living through a period of economic stagnation. And im peter getler. I joined the Cato Institute a year ago as president. And over that time brink lindsay in particular has done a lot of work trying to explore the reasons for this growth slowdown. Hes published two books. I have them as books, theyre ebooks. One is understanding the growth slowdown, and another is reviving Economic Growth. For the first time in my life, we have had a tenyear period during which real gdp growth has not reached 3 in any single year. And at the time i joined cato 13 months ago, i was actually hopeful, because during the periods of my lifetime where weve lived through time of economic stagnation or sharp economic contraction, its created a lot of pressure, tension and anxiety that often has been the impetus for positive change in, on the policy front. And i think over the last few months ive realized that i was correct in expecting that economic anxiety would create some turmoil and some, and stimulate some change. I was wrong because its not the kind of change that i had anticipated. Clearly. Really lucky to have three gentlemen here that i dont think really need much of an introduction, but ill try to provide one. Between them i think theyve probably written more books than ive ever read [laughter] but i think its a great opportunity for each of them to comment on, you know, their views on how were going to revive Economic Growth in the United States and thereby continue the course of progress and prosper the city that our nation has enjoyed prosperity that our nation has enjoyed for such a long period of time. And they each have books that have been released recently that actually speak to this. I spoke with a donor to cato recently, and he has a son who will be starting college in the fall. And he told me that he was considering attending Cato University this summer so that his son could be inoculated against what he was likely to learn from the economics professors in college before he attended. When i was getting ready for college, i didnt need such inoculation. But in the senior year of my high school days, george g with ilders book gilders book wealth and prover poverty was released, and during the summer i read it. It gave me no shortage of ammo to use against the marxist professors i encountered when i attended school, including in such classes as capitalism and its critics. I think things have changed. Some things havent changed. I think the philosophical makeup of the faculty at most universities is about the same as it was at that time. But i felt that in my classes we were able to engage in lively debate and disagree without fearing, as many students do today, that it can hurt their grades and their transcript and that disagreement is not permitted. So i actually thank you, chiang, for providing me george, for providing me so much ammo to use against fraternity brothers, professors and others with whom i didnt agree, who didnt agree with me in the case for enterprise and free markets. A lot of the ammo started at cato. Thanks so much for that. Thanks so much for that. Georges book is the scandal of money, and were delighted. I think one of the ideas that cato has promoted for a long time is the fact that our fiat money system and the power of the Federal Reserve is a great threat not only to our economic well being, but to how freedom. To our freedom. And thats one of the reasons that for 34 years cato has held a prominent annual monetary conference thats coordinated by our Vice President , jim dohrn. And that we started under the direction of our center for monetary and financial alternatives to highlight these risks and to promote free Market Alternatives to our current system. So georges book is very important and timely. In addition, steves last book, i believe, was a similar topic, highlighting the threat that the lack of sound money poses to our country. So those are both tremendous contributions to the popular literature. I told steve earlier that for most of my life ive not been affiliated with either major party but that in late 1995 i registered republican so that in the 1996 connecticut primary i could cast my first primary vote for steve forbes for president. Steve replied that he wishes a lot more [laughter] registered and voted for him. But even in defeat, he made great contributions to the debate and the case for freedom, enterprise, sound money and a flat tax. And hes still at work. His book that he wrote with elizabeth ames, reviving america how repealing obamacare, replacing the tax code and reforming the fed will restore hope and prosperity. 9 and i think he does a fantastic job really prioritizing three key areas, particularly areas such as Health Careand money where many of the problems are actually created by Government Intervention and for some reason the prescription that many people suggest is more Government Intervention. Finally, mark skousen who we all know as an economist, an economics professor and author, but many also know as the impresario of freedom fest which he accurately calls the Worlds Largest gathering of free minds which aches place in las vegas takes place in las vegas every summer. Were delighted to have mark here. I mentioned at outset that while we can agree that there has been income and and economic stagnation of late, the measurement problems reflected in our economic aggregates, i think, do fool us because there are many things that arent captured in gdp. And i, again, reject the assertion that americans really at any income level have experienced stagnation in their well being n their lives in the last 40 years. Mark has proposed and he now has an updated version of his book released last year, the structure of production, an alternative to Gross Domestic Product as a measure of our economy. And he has proposed an alternative called gross output. Im going to let mark explain it because one of the reasons, rationale he gives for it being an improved and acceptedversion of, measure of the economys performance is that its now published quarterly by the government along with the gdp figures which is quite an achievement by mark. I remind him as libertarians, we dont necessarily take Government Action as an endorsement. So im looking forward to his remarks, exblaining some of the explaining some of the work hes developing in proto moting more effective measures of economic performance. And we will proceed with the speakers in the reverse order by which i introduced them. So please join me in offering a warm welcome to cato to mark skousen. [applause] peter, yourcomments about slow Economic Growth and the fact that we havent experienced 3 growth in some time reminds me of this program that george w. Bush set up called the 4 president growth plan. 4 growth plan. And when i talked to the organizer of it, i said 4 growth plan, now, did he mean growth of the economy or growth of government . So she didnt appreciate that comment. But unfortunately, under george w. Bush the economy never did, using standard gdp that itsics, never statistics, never did grow more than, never did grow 4 during the entire period of full employment. Its kind of unfortunate. What id like to talk today is what peter mentioned, gross output. I think its a very important statistic, and, in fact, my main thesis is that gross output or g. O. As we call it offers a better, more comprehensive picture of the economy, is a powerful Unifying Force between accounting, finance and economics. It links micro with macro, and it appeals to all the major schools of economics. In many ways g. O. Is the missing piece of what the elitist economist calls the prosperity puzzle which is their latest issue. And its interesting, they talk a lot in there about the problems with gdp which im sure will come up in this discussion. But in any case, my argument that this is a unifying approach, that its a more comprehensive picture of the economy, its a tall order. And so id like to get started. I actually see it as a paradigm shift in the way we treat macroeconomics. So we start off with basics, what is gdp, what is it supposed to measure. Annual spending is one way of looking at it in the economy. Consumers, government and business. C i g is the way they normally talk about it in classes. And theres a problem with gdp. Theres a lot of problems with gdp. But the one i want to focus in particular is according to gdp statistics, what drives the economy. And so what we find out that when you break down gdp in c president you see Government Spending second and business spending a poor third. And what does that say in terms of policy implications, you see . Thats the issue. And, of course, because Consumer Spending represents such twothirds, basically, of gdp, you get the media constantly making, creating a myth. Its one of most common myths in economics. And this is an example of it from the wall street journal. You get it from all the publications. Household spending generates more than twothirds of total economic output, says the wall street journal. So steady spending gains; that is, Consumer Spending gains should translate into Economic Growth. If only consumers would spend more, thats all it takes. And, of course, you have the new york times, Consumer Spending makes up more than 70 of economy. And it usually drives growth during economic recoveries. And finally another one from the wall street journal, consumers are the engine of the u. S. Economy. Consumers. Not producers. Not entrepreneurs. Consumers. Accounting for about 70 of the economy. So you can see the problem thats inherent with using gdp as a statistic. Is this, are we coming to an accurate conclusion, is our question. So we have to can ask ourselves the question, what is missing from gdp . Well, again, gdt is c i g in this 86 trillion economy. Is that the economy . So we break it down into consumption. 67 , 12. 4 trillion. Investment, 3 trillion and government 3. 2 trillion. So what is miss anything gdp . Missing in gdp . This is the surprise factor. The supply chain. Gdp does not measure the ply chain. It does not the supply chain. It does not measure all the business spending, the b to b spending to bring the products to their final use. You see, gdp just measures the value of finished goods and services. Your clothes, your shoes, the internet, all of everything that were enjoying right now. This cup of water. Thats all counted in gdp. But the spending by business to get you to the finished products is left out. And that is its achilles heel in many ways. And look at the size of that supply chain which ive been measuring and now the government is measuring, be, bureau of Economic Analysis. 20. 3 trillion. Its more than Consumer Spending which is 12. 4. Its more than Government Spending, its more than fixed. See, the i part is fixed investment. Now, what is gross output in well, it can be for those of you who are economists and youre familiar with Irving Fishers equation of exchange, it measures total transactions. Its also a measure of high yaks triang9s hayeks triangles. So this is taken from prices and production, this great book that Friedrich Hayek wrote in 1931 when he was lecturing at the London School of economics. And theres a picture of the triangle that he used. Now, it was purely theoretical. He has no breakdown, he has no statistics backing it. It was pure theory. And it has had a rough road of acceptance. But what im suggesting is that hayeks triangle is being measured today now by the government. And this is a fantastic breakthrough. And i am pleased that this program here today is taking place in the hayek auditorium. So appropriate considering the fact that the governments now measuring hayeks triangle. So we all know the background of Friedrich Hayek, i just thought i would post this up here. And particularly hes known more for his book the road to serfdom and the constitution of liberty, but he is also author of this macroeconomic work which formed the foundation of my own work in the structure production called prices and production published in 1931. I have a first edition, signed by Friedrich Hayek. Today ive come out, or laissezfaire books has published his two essays on the Business Cycle called hayeks triangles, and they asked me to write the introduction. But heres a modern day version of hayeks triangle where it shows the four stages of production, resources, production, distribution and final output. So you can see gdp is in there, but then so are the stages, the supply chain prior to that where we have stages one, two and three. So this is a great way for students to capture what hayeks triangle and what i call the four universal fourstage model of the economy. Every good and service that you and i use has gone through the resource stage, the production stage, the distribution or wholesale and retail stage and then to final use which is represented, number four, by g, the p. Well gdp. Well, the good news is in april 2014 the bureau of Economic Analysis has now started to measure gross output, a measure of hayeks triangle or total transactions under Irving Fisher depending on how you want to look at that. And we have steve land fed whos the pioneer as the director of the bea who said gross output provides an important new perspective on the economy and a powerful new set of tools, of analysis, one that is closer to the way many businesses see themselves. And isnt that true . Business sees themselves as producing moving the product along the production process. And thats what gross output is measuring. So whats really interesting, a lot of people havent noticed this, but whenever the bea comes out with its quarterly announcements, release of gdp data which they did just recently, notice how they define, how they define gross gdp. They de