This morning on radio, Glenn spoke to author, economist and political commentator John Lott. His latest book, At the Brink, examines what the current administration is doing and what this government is doing to push us over the cliff. Lott will also be on The Glenn Beck Program tonight at 5pm ET on TheBlaze TV. Start a 14 day free trial to watch.
GLENN: John Lott is one of my favorite thinkers, especially when it comes to ‑‑ well, when it comes to facts and figures, you know, he's probably best known for his work on guns, guns by the numbers. I think his name is ‑‑ the name of his book is More Guns, Less Crime, and it is the ‑‑ it is the standard bearer, I think, for that kind of stat, and you won't read that anyplace else. Well, he has turned his attention now to what this administration is doing and what this government is doing to push us over the brink. That's the name of his new book called At The Brink. Will the man who won't be named on this program without a $20 fine, will "that guy" push us over the edge is the subtitle and John is with us now. Hi, John, how are you?
LOTT: Great to talk to you. Thank you very much for having me on.
GLENN: You bet. You're taking this on, and I wonder if we can ever come back from this because I look at the facts that you have in this. I just look at the things when you talk about the stimulus and how the stimulus is going to go down in history as the most expensive economic failure in all of history. You want to make that point first before I ask you the question on it?
LOTT: Well, I think there are some things that we can come back from and other things I don't think we're going to be able to completely. The economy's one thing. I think we're always going to be poorer than we otherwise would have been as a result of this policy. I mean, we've had the biggest increase in government spending and inflation‑adjusted terms that we've ever had in our nation's history, even bigger than the increase, even accounting for inflation, than we had during World War II.
GLENN: That's amazing.
LOTT: But the only thing that we've gotten out of that is a massive increase in debt, a debt that for a family of four now, publicly held debt is worth $200,000 per family. And we have incredibly slow growth. And those things aren't unrelated. I mean, the president keeps on saying that we can't cut spending at all, not even the growth rate, or we're going to somehow hurt the economy. And the exact opposite's true. You look around the world; those countries that have followed his policy, his Keynesian policy of increased spending and increased deficits ‑‑
GLENN: Lose.
LOTT: ‑‑ those are the countries that are hurting now those are the countries that have slow growth and bad employment growth.
GLENN: So where I want to go here are things like his stimulus and basically his policies is we're not going to be able to turn it around because in World War II we at the end had factories. We had hard goods that turned ‑‑ we could turn those things that we were building for planes and ships and everything else, we could turn those around and we had an engine to now start to build the best cars in the world and the best refrigerators in the world where at the end of this one we got nothing.
LOTT: Well, we got government and we have a lot of production that wouldn't exist without subsidies. You have all these green jobs that are out there and there's a reason why they don't exist without these subsidies. If you took away the subsidies, they would disappear because their costs are much greater than the benefits. They make us poorer. When you have a gallon of ethanol that cost more than twice a gallon of gasoline and produces less energy, it's almost as if you're just throwing away, you know, $100 a barrel that you, you know, that's just gone. You might as well just burn it up.
GLENN: So you ‑‑
LOTT: We're poorer by that amount.
GLENN: You talk about healthcare as another big problem, and I am stunned at the number of people who are just beginning to figure ‑‑ people I think are really smart are just beginning to figure out, "Wow, there's a real problem here." How long before the effects of universal healthcare really kick in and so everybody knows it?
LOTT: Well, some effects have kicked in. Over the last year, over the last 12 months the cost of health insurance premiums have gone up by 14.3%. Hardly the type of price control that the president was promising with his packages. But the real damaging stuff's going to go into effect this coming January. I mean, there's a reason why the president had the presidential election before the main bulk of these healthcare regulations went in effect. People I think are going to be shocked not just by, there's going to be additional big increases in the prices of health insurance but I think within a relatively short few years, the health insurance markets just for private insurance is going to disintegrate.
GLENN: Okay.
LOTT: And the reason why that's the case is that you have two conflicting rules. We are supposed to ‑‑ he's supposed to try to make everybody get insurance with these fines or penalties but at the same time he's said that there's no regulations that insurance companies can have on preexisting conditions. The problem is that the fines and penalties are small relative to the cost of getting insurance. The cost of insurance for a family of four will be about ‑‑ is about $14,000. It's going to go up probably to about $17,000 or $18,000 over the next few years under Obama's plan. And you'll be paying a few thousand dollars in penalties.
GLENN: Right.
LOTT: It will make ‑‑ what will happen is it will be like running car insurance where you can wait until you get into a car accident and then buy insurance.
GLENN: Right.
LOTT: There's going to be good people out there who are going to feel bad gaming the system and they will wait. But at some point even they are going to feel like suckers because as more and more people wait until they get sick before they buy insurance, you know, they'll pay the few thousand‑dollar fine that they have to pay there rather than have to pay, you know, the 15, 16, $17,000 that they have to pay for their family, insurance premiums are going to soar.
GLENN: Well ‑‑
LOTT: Because you can imagine how high car insurance would be if everybody waited until they had an accident before they bought it.
GLENN: Right. It would be the price of the car or the damage.
LOTT: Exactly.
GLENN: And that defeats the whole problem ‑‑ or the solution.
The other side of that is companies. And we're seeing companies already doing this. Companies are cutting hours. They're cutting their lower, you know, paid people they have to find that money for their healthcare some place. So they have to cut that. They are cutting hours back. So part‑time people are going to be even worse off than they were before. And a lot of companies are just saying, "I'll pay the damn fine. I don't care. I'm not going to provide it." And it forces people into, into the government which is supposed to be, his words, the provider of last resort. But he's made it so it will be the provider of first resort.
LOTT: Exactly. Look, when the ‑‑ when Obama, the Obama administration and the Congressional Budget Office were figuring out the impact and the cost of ObamaCare, they essentially assumed that people wouldn't be changing their behavior. But you and I know ‑‑
GLENN: They will.
LOTT: ‑‑ that when you go and make something more costly, people do less of it.
GLENN: Here's the thing, John. I don't believe for a second they didn't know that they wouldn't change their behavior. This is a guy who won the last election and not a lot of people reported on this, but he had behavior psychologists.
LOTT: Right.
GLENN: ‑‑ on his campaign. He's a guy who has Cass Sunstein as part of his administration. They know "nudge." They know exactly how human behavior is going to work.
LOTT: Right.
GLENN: It stops me from believing that these are honest mistakes. Lot lotto, I don't ‑‑
GLENN: Do you believe ‑‑
LOTT: Yeah, I don't believe they're honest mistakes. I believe, all I'm saying, when they would tell the public what it would cost ‑‑
GLENN: Right.
LOTT: When the official estimates went out on the cost, those cost estimates assumed people's behavior wouldn't change. I know they know that, we know it changes, and what I'm saying is that these cost estimates are going to be radically off. When people ‑‑ people are going to go under the government system, which is going to be much more expensive and, you know, we taxpayers are going to be having to pick up the bill.
GLENN: Okay. So ‑‑
LOTT: But this is part of a process. So I think part of a conscious design to basically destroy private insurance in this country. They didn't want to publicly go out for single‑payer government plan, but this is something that will lead to it fairly quickly I think.
GLENN: Yeah.
LOTT: Because ‑‑
GLENN: Of course it will.
LOTT: ‑‑ as the cost of private insurance soars and as people move onto the government plan, they'll effectively get there.
GLENN: Okay. So John, the congress isn't going to do anything, the president is just executive order after executive order, and the book At The Brink is not about healthcare alone. It's about the whole thing. What does the average person do? How can we possibly stop this?
LOTT: Well, there's some things that I don't think we can stop at this point, the destruction of the pharmaceutical industry, for example, the huge elimination of research jobs and the lack of future drugs that we're not going to get that would have saved lives not only in the United States but around the world. There's not too much we can do about that right now. And I don't think we can do too much in the near term about ObamaCare. He's there as president for four years.
On the economy there are some things we can do. We can try to make sure that things like the sequester goes into effect. I mean, it's just absolutely surreal to me ‑‑
GLENN: Wait, wait, wait, wait.
LOTT: To put off asking about the government spending and the lack of growth. Obama threatens that this $85 billion cut this year in government spending out of the $3.8 trillion budget is somehow going to send us off the rails. I mean, look around places, it's the places that have been spending the money that are off the rails. And to somehow believe that this kind of cut ‑‑ and this is after we just had $60 billion extra spent on Hurricane Sandy that somehow an $85 billion cut is going to be vast this year. And, you know, people need to keep Republicans' feet to the fire, not just on the sequester but on the debt limit bill that comes up.
The president constantly makes wrong, inaccurate claims about things like we'll go into default if the debt limit doesn't increase. It's simply false. I mean, any economist knows that as long as you can keep on paying the interest, you're not in default. And we have much more than enough money to pay the interest. Obviously almost 40 cents of every dollar that's spent by the government's being borrowed right now.
But look, if we were to just live within the revenue that we get, the government's still going to function. It's not going to do everything that everybody's going to want it to do, but it shouldn't be doing that anyway. And so, you know, the president can make the cuts as painful as he wants, but the thing the Republicans should point out then is, look, you could have spent the money on this. Instead you decide to make things bad and spend it on some pet green project that you wanted to have the money keep on going to.
GLENN: Right.
LOTT: That's your fault that you're doing it. And if I were Republicans there, I'd say, look, you've got to cut spending. We've just had this huge increase in spending.
When Obama ran in 2008, his big promise, if you go back to the presidential debates, was to cut the size of government. He kept on saying over and over again the net size of government had to get smaller. A week after the election he starts talking about this stimulus and then it was supposed to be temporary, a year or two. We're five years into the Obama administration now and not only can't we keep any of those earlier promises but we somehow can't even slightly slow the growth of government.
GLENN: Right.
LOTT: That somehow even now slightly slowing the growth of government would lead to financial disaster and, in fact, the exact opposite's true.
GLENN: All right. John, thank you so much. The name of the book is At The Brink and it's available everywhere by John Lott, a really truly brilliant guy. He's also going to be ‑‑ he's helping us on another book that we're coming out. We're crashing a book here and we've gone to the best experts, and I wanted to put together a, almost a guide for the Second Amendment and the truth about guns, and I'm calling the name of the book is Control because it is really all about control. Exposing the truth about guns. And John is helping us with some of the facts on that, and I so appreciate that. That's coming ‑‑ when is that coming out? Do you know, like ‑‑
STU: April, late April.
GLENN: Due I think this week. So late April is when it's coming out. Control. And he, John, will also be on with us tonight with the sheriffs because we have the, probably the most controversial sheriffs in all of Washington, but they are from all across the country and they are probably the most popular sheriffs because they are the ones who are saying, "I am folding. I will stand and protect and defend your right to have a gun," and they're not going to come in and search your house and they are not going to come in and take your gun. The sheriffs tonight, your last line of defense on ‑‑ at 5:00 on TheBlaze TV. Make sure you join us for that. John, thanks a lot. We'll see you later tonight.
