GLENN: Well, we were just talking to a phone caller about the little guy and I think there's nobody that defines the little guy more than Steve Forbes. Welcome to the program, Steve.
FORBES: Glenn, good to be with you. Thank you.
GLENN: You've got a book called how Capitalism Will Save Us, and I want to ask you a couple of things that I see in the economy, but I first want to ask you, we just had a caller who said how come the Democrats are always the party of the little guy? How do you combat that? How do you convince people that they are in bed with gigantic business and special interest? Do you have an answer for that by any chance?
FORBES: Well, they start first with giant entities like the federal government, the Federal Reserve which printed too much money and gave us the housing bubble, monstrosities like Fannie Mae and Freddie Mac which twisted and distorted and ultimately blew up the housing market. And in terms of helping people, we know that the government ends up doing more harm than good. Look at welfare. Took welfare reform to stop that. The so the question is what kind of an environment helps people who start with very little as Abraham Lincoln puts it, to put it to improve your lot in life and that is true free markets where people like Steve Jobs who were abandoned by his biological parents goes on to do great things. Bill Gates, a middle class kid goes on to create a huge company. Larry Ellison, orphaned, does the same thing. And in no other system other than free markets, entrepreneurial capitalism can people do that and benefit all of us. Just like at cellphones. Four billion of them around now as you know, Glenn. Twenty years ago cellphones were as big as a shoebox, clunky, expensive, hard to carry around. Now today they're sleek, chic and four billion of them including hundreds of millions of poor people. The government couldn't have done that. So the little person so called, people with very little, they do best in an open free market.
GLENN: Steve, I am very concerned. But see the front page of the New York Times yesterday and what they discovered, the debt might be bad? Did you see that story?
FORBES: Well, 200 years late, yes.
GLENN: Yeah. But they are talking about, they are talking about now, I think they said $700 or $750 billion. My research shows about $800 billion just to service the interest by 2019 and that's if everything goes well, which it's not. We are printing too much money. I don't think the Fed, I think we're looking at a Fed that's going to make the same kind of decisions that the central banks or the banks in Germany made where if they shut down the interest rates, they are going to choke the economy to a complete stop. If they don't raise the interest rates, the dollar is going to go off to oblivion. How can we solve this problem?
FORBES: Well, first on the Federal Reserve, the first thing it should be doing is stabilizing the dollar. We don't want inflation or deflation. We just want flation so that we have something that people can count on. If you don't have a stable dollar, you've got commodities, speculation to excess; same thing with currency, you don't get investment in small businesses, new businesses. And the way they do it is just stop printing it. Now, people will say, gee, won't that raise interest rates. No, it will actually help small businesses. If you're a consumer or a small business, your interest rate is not the Federal Reserve rate of near 0%. You are facing 8, 10, 12, 20% interest rates. So if we get a stable dollar, the people who can really make things happen, their cost of money will go down and the availability of money to do constructive things will go up. The losers will be the federal government which will finally have to face up to the fact if you are going to spend, you've got to get the money from somewhere. Just one little factoid is how bad this thing is thanks to their mismanagement is that the average maturity length of the national debt now is 49 weeks.
GLENN: Oh, my gosh.
FORBES: Not years. Weeks. So you start getting short rates up again, you are going to blow another hole in the budget.
GLENN: But wouldn't I mean, Steve, doesn't there come a time when, I mean, you know. Look, you are Steve Forbes. So you've got I mean, you've been in these situations before. If you are sitting there and you are the money lender and a business was behaving the way this country is behaving now, at what point do you say, yeah, you know what, I think I've lent you enough money, I don't think I'm going to pick you up for another 48 weeks. This, you guys got to stop spending.
FORBES: Oh, I think you are going to see that next year as other countries start to pull back from this money printing. The Australians have already started. Other countries will do it. We and the Brits I'm afraid will be the last ones to get the message and that's going to force us to change. You cannot let the dollar be treated like confetti forever. We tried that in the Seventies and it just led to a decade of stagnation and horrible things and political repercussions overseas. And so they are going to be forced to change.
GLENN: I know that America, if she's allowed to be free, if you don't shackle the entrepreneur and the dreamer, we can make it through anything. We've already I mean, we are the people that conquered the mountains and the West. We can conquer anything. But we have to be free to do it.
GLENN: How concerned are you that, A, healthcare is going to pass and, B, these guys are gobbling up so much of the economy that we're about to snuff out any kind of entrepreneurial spirit in America?
FORBES: Well, you are right. They are extending their tentacles more and more in the name of saving us, long after the panic subsided, the financial panic. They are now, the Federal Reserve's now ready to tell what salaries are for 5,000 financial institutions, and this bill that Senator Dodd is proposing would make anyone who does anything with money subject to government bailouts and control. So but I think the American people, what you are doing and people are rising up is you saw it with tea parties, you saw it with town hall meetings, you saw it in the elections in Virginia and New Jersey which the House of Representatives resolutely ignored. The people instinctively understand something profoundly wrong is going on and you are going to see more and more blowback from it. So I think the odds are better than 50/50 despite the Louisiana Purchase, Mary Landrieu and some others, I think you are going to see this, could very well see this healthcare bill blow up as people make their feelings very clear. People just know they don't have the answer for it.
GLENN: There is a new book. Steve has just put out. Steve Forbes, how Capitalism Will Save Us. Thank goodness somebody is out there saying that it is the free market and free people is the subtitle, are the best answer in today's economy by Steve Forbes. It's available in bookstores everywhere. Not only read it but then share it and pass it on to your kids because nobody else is saying these things. Steve, always good to talk to you.
FORBES: Glenn, thank you. And Elizabeth and I are so grateful to have the chance to discuss the book with you and keep fighting. We will win this thing.