Government youre 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 governments 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 theyre 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. Lets 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 cant 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 youre 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 dont have an Aircraft Carrier with marines on board and rescue helicopters. The u. S. Military does. I want them steaming toward the phippines when thatsits. John i dont 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 leftwing 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 youre 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. Youre 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 dont think you want the government to take a pass. John i do. Lets 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 dont want to get rid of it. Certainly we can look more closely as of the applications. John cut it way back. Theres 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, dont reward laziness,. John they all do that. I dont 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 peoplethe 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 wont 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 dont 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 dont 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 thats 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 thirdparty 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 fulltime 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 dont 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. Im 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 obamas says the way to help poor people is to give the a free cell phone. Hmm. Mmhmm. [ engine revs ] [ male announcer ] oh what fun it is to ride. Get the mercedesbenz 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 mercedesbenz 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 youre 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. Thats 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 dont know what. I went out and investigated. I didnt 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 dont 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 ones 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. Its their own money. Thats 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 whos 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 thats 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 wasnt 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 dont 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. Lets take that same question to an economist to rise a freemarket institute at texas tech. Am not bothered if they dont 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 theyre good at making money. Stick to wha your specialty is. Its 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 dont 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 peoples list featured philanthropy. So how they are now reading billionaires by how much they give. A kind of want my heart. Lets 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 its fine that we recognize that as long as weont demonize those who arent doing it and think theres 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 pro