John Stossel Unmasks the Fraud of Big Government

During his April 23rd talk before the David Horowitz Freedom Center’s Wednesday Morning Club about his new book “No They Can’t,” his first work in eight years, John Stossel reminded everyone that if he had been alive in 1776, his signature might well have appeared on The Declaration Of Independence or, at the very least, one might have seen him later on at the Constitutional Convention giving advice.

Stossel, an escapee from ABC, now has his own program on the Fox Business Network. He is a self-confessed libertarian and an evangelist of common sense, who would agree with Adam Smith’s observation that: “I have never known much good done by those who affected to trade for the public good.” Certainly, “that government is best which governs least,” a sentence often attributed to George Washington but was first seen in an essay written by Thoreau, is a notion to which Stossel would also subscribe.

Channeling his inner John Stuart Mill, Stossel noted that the “We” in “Yes We Can” is the “We” of the government and not the “We” of “We The People.” For Stossel, therein lies the rub: He believes that from birth we have been programmed with a desire to be “looked after” and that this programming can lead to an easy acceptance and an eventual dependence on the government, government solutions, and in the well-meaning but cold embrace of the welfare state, which so often provides its recipients with one long swing in the government hammock. The unintended consequence of this government largesse, he says, is more dependency resulting in programs which have now become unsustainable.

There is a big difference between self-interest and narrow selfishness. Business, Stossel said, is not a zero-sum game. The merchant is happy when he sells his product and the consumer is happy to have acquired a product he desires. To demonstrate this, Stossel alluded to Adam Smith’s observation that:

It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner but from their regard to their own self-interest. We address ourselves not to their humanity but to their self-love and never talk to them of our own necessities but of their advantages.

Grasp that and you will have grasped the very heart of the matter, for capitalism reaps from the natural activities of man whereas socialism, and its concomitant central planning, requires an intellectual construct.

It has become fashionable, Stossel affirmed, for people to condemn capitalism as being unfair and to believe that only the government can curb its greedy appetite and create a level playing field providing equal opportunity for all. Its critics often expect that equal opportunity will lead to equal results and get upset at any hint of wealth disparity, which, as Stossel pointed out, is actually a natural by-product of freedom. Here he was partly reflecting Churchill’s view that “some people regard private enterprise as a predatory tiger to be shot. Others look on it as a cow they can milk. Not enough people see it as a healthy horse pulling a sturdy wagon.”

Compare, Stossel noted, the best automobile produced by a planned economy, like the one in the former Soviet Union and it satellites, with the worst automobile you could buy in America and you will see how capitalism and the competition it induces always produce a better product. Within a short time after the Berlin Wall collapsed, the Trabant, the East German motorcar, had disappeared from the marketplace. It just could not compete. Central planning has long been discredited as an economic theory except by the devotees of John Maynard Keynes and all left-wing liberals who still keep a romantic attachment to it prominently lodged in a nostalgic chamber of their minds.

Why is it, asked Stossel, that on a planet of about 7 billion people, over 2 billion of them live on less than $2.00 a day? How did Hong Kong, with no natural resources, go from being poor to rich within 50 years? Economic freedom and the rule of law does not exist in those poorer countries, he said, but where those two ingredients exist then human innovation and entrepreneurship will take root and bloom. This is how the United States accounted for over 50% of the world’s industrial production by 1890. It is what gave us the likes of Cornelius Vanderbilt, Andrew Carnegie, Henry Ford, John D. Rockefeller, Levi-Strauss, Sears Roebuck, Thomas Edison, Harvey Firestone, J.P. Morgan, Bill Gates, Steve Jobs and Warren Buffet.

It was clear throughout his talk that Stossel’s bête noir is the size, growth and inefficiency of government. Big government reduces our control over our own lives as it spreads its tentacles over every aspect of our existence. It cannot solve our problems but that is not to say that “We The People” cannot. He made the point that we can travel the globe making credit card purchases and withdrawing money from ATM machines abroad and within a month our statement will arrive with every transaction neatly posted and accounted for whereas the government can’t even supply machines capable of counting votes properly. This is the same compelling objection we have heard about handing over the supervision of our health care to the same government that gave us Amtrak and the Post Office, a notion that should alarm even the slowest of minds.

Decades ago it became evident that there is nothing as permanent as a temporary government program, or that if government spending was all it took to be successful then Sweden would have become the most successful country in the world and the Soviet Union would have won the Cold War. Stossel’s speech touched on many aspects of his new book in which he illustrates the truth of Milton Friedman’s quip that if the government were to be in charge of the Sahara Desert within five years there would be a shortage of sand.

Stossel made it plain that our government now operates on an intrusive and regulatory scale that is opposite to the intentions of the Founding Fathers who, it has been said, were more interested in a safe government than an efficient one; to which end they crafted and put in place slowing and blocking mechanisms: three branches of government, two legislative branches, the veto, the veto override, super majorities and judicial review. However, even with all of this it is clear that Stossel believes that the government is in danger of outgrowing the consent of the governed, even as it has already incurred their disapproval, as indicated by the lowest approval ratings for Congress since records started being kept.

For Stossel, the government has more solutions than there are problems, and it can’t resist jumping to the front of the parade pretending to lead it. But by constant and ever increasing interference, it disregards and diminishes individual freedom, discourages individual responsibility, stifles creativity and is responsible for one crisis after another while assuring us that only government intervention can help prevent the disasters of its own creation. In this regard the spirit of the government has seldom roamed beyond its own selfish interests instead of husbanding the greatest experiment in freedom the world has ever seen. This is what animates Stossel who, in “No They Can’t,” exposes the fraud that only the government knows what is best for us and is best suited to provide it.

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  • crackerjack

    Stossel should stick to theocracy. His economics are out of date by a few decades.

    Big Goverment controlled capitalism is the winner of the millenium so far, as China and Russia prove. China has just created a well-to-do middleclass the size of the USA with a zentralist controlled economy where the financial industrie must promote national interest. In China, Big Goverment controls Big Money. In the USA Big Money controls Big Goverment. US investors and business have made their choice, and its not the USA. The same can be said for Russia, with Godfather Putin putting national interest before the interests of international finance mafia and foreign business, as represented by Chordorkowski.

    The US version of "free" croney capitalism kidnapping national wealth and transferring it worldwide is no model for the future. The nations of the world have long ago begun looking elsewhere.

    • Spider

      China is only doing better now because they still have slave labor and no environmental controls – not because they have a better understanding of economics. The fortunes are reversing because they are doing what we used to do ( free market capitalism ) and we are doing what they used to do (totalitarian socialism – i.e. economic suicide).

      • crackerjack

        Chinas economy and financial system is goverment controlled. In the USA, the financial system controls the goverment. At this moment in history, Chinas has just created a middle-class of over 100 million, while the US modell is in the process of destroying its middle-class. Apparently, Stossel's "free market" mantra works only for a chosen few.

      • Open Eyes

        Correct except China has a goal and it is not to benefit its people. With willing and useful idiots in the US they have reduced our manufacturing might and the living standards of Americas middle class. We are dependent on a communist country for many products and even foods are now imported from China with out sanitation or health standards. China is establishing a massive military build up with the dollars that we have sent them. Their goal? Read between the lines and pray that we regain leaders with wisdom and strength. Stossel is right big government equals big problems for we the people and our posterity. Think ahead and open our eyes. Thank you John Stossel.

        • crackerjack

          Stossel contadicts himself. Radically free markets and national interests contradict each other. The free market goes where production is cheap, China and sells where the highest profit is achieved, the USA.

          The free market knows no patriotism, nationality, human-rights nor values, the free market's incentive is profit.

          • Open Eyes

            Therein lies the massive problem. The love of money with out the love and respect for God given freedom. Our government has been bribed-literally and philosophically- to to look the other way partly because we have had prosperity for so long [as if we should be ashamed that we won the fight and hold the fruits of freedom?] and many Americans do not appreciate freedom nor maintain it nor understand its origin.A godless society, a wealthy , lawless and growing communist government with predatory business practices [ie stealing the intellectual rights from America] Is poised to crush us as we fall into immorality and Godlessness ourselves. If government has any usefulness it should be to recognize the long term strategy used by China which is to use the free market to decimate our manufacturing base and with the help of EPA, the environmentalists Obamas Marxist bent, eventually to collapse and poison us. San Alinsky would be proud. See David Horowitz pamphlet "Rules for revolution" it is an eye opener. Lord help us to get leaders with wisdom and strength in these dangerous days.

    • Supreme_Galooty

      If yer brane is out to luncheon
      And prattle yer tongue's only function
      If little birds sing
      And tinkle bells ring
      Yer speech is not lofty – 'tis fustian.

      Wise up, sailor boy.

      • David Horowitz

        Watch what happens in the next decade.

        • crackerjack

          The coming decade will not change the fact that the free market follows profit, not patriotic or moral considerations.

    • mlcblog

      That's what happens when you go to the government schools. Principles that have lasted for the duration of civilized life are portrayed as archaic.

  • SCREW SOCIALISM

    I lost all respect for John Stossel when he came out as a supporter of MORON Paul.

  • radicalconservative

    Well Stossel is correct that Ron Paul believes in a free market economy to a degree that he would actually promote policies that bring back economic freedom. Ron Paul is naive to a dangerous degree vis-a-vis Islam and to that extent Ron Paul may be a “moron”. If foreign policy did not command our attention at this time Ron Paul might make sense. (Or not; gold standard? not so sure…)

  • SteveD

    ‘whereas the government can’t even supply machines capable of counting votes properly. ‘

    Of course these devices were obtained from a manufacturer in the PRIVATE SECTOR. So much for libertarian/neoclassical bullshit sowed by clowns like Stossel and your article’s author..

  • SteveD

    ‘John Stossel Unmasks the Fraud of Big Government’

    All federal spending has one huge advantage for the economy: All federal spending adds dollars to the economy, which grows the economy. (GDP = Federal Spending + Non-federal Spending + Net Exports)

    What about Stossel’sl caveat, “FRAUD”? Is fraud an example of wasteful spending?

    If the fraud steals dollars from someone in the private sector, it is wasteful. But if the fraud steals dollars from the federal government, it may be criminal, but it isn’t wasteful. In fact, it ADDS DOLLARS to the economy.

    *The federal government, unlike state and local governments, has the unlimited ability to create dollars. It never can be forced to run short of dollars.

    *The federal government creates dollars by spending. To pay a bill, the government instructs vendors’ banks to increase the balance in the vendors’ checking accounts. This is how the federal government creates dollars.

    *Thus, unlike state and local taxes, federal taxes do not pay for federal spending. Even if federal taxes were $0, the federal government could continue to instruct vendors’ banks to increase the balance in vendors’ checking accounts, i.e. the federal government could pay its bills.

    *Therefore, taxpayers do not pay for federal spending.

    *Federal spending for one purpose does not replace federal spending for another purpose.