stossel on mcbama

John Stossel's E-Mail
Oct. 16, 2008

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I just wanted to remind you that I have a special hour on "20/20" tonight.

At 10 p.m. ET, ABC airs "John Stossel's Politically Incorrect Guide to Politics."

There's tremendous excitement about this year's election. People say that their candidate will fix America. Barack Obama inspires idol worship that's usually lavished on rock stars. At the Republican convention, one man told me John McCain was like Superman.

Give me a break. Obama and McCain would have to be a combination of Superman, Santa Claus and Mother Teresa to do what their supporters say they will do. Even if they were, politicians cannot direct our lives and solve our problems. This faith in political solutions thrives in the face of repeated government failure:



Big farm bills have raised the price of food and squeezed out small farms. Campaign finance reform has made it harder to challenge incumbents. FEMA can't deliver water to a hurricane-ravaged New Orleans as well as Walmart can. Medicare has a $35 trillion unfunded liability.

Politicians' "fixes" usually make things worse. Yet the media and the political class call for more government control. Do we really need a president to plan our lives? No. Most of life works best when YOU are in charge.

Imagine that you had never seen a skating rink, and I told you: "I'm going to have people strap blades to their feet and go out on ice -- experts and beginners -- fast movers and slow -- all skating where they choose to go." Your initial response would be, "That would create bedlam! We must have rules: signs, traffic cops (aka: a president), or skaters will smash into each other." But of course, the existence of rinks demonstrates that there is another way to organize life: something called spontaneous order.

We need some predictable and understandable rules -- like the rules you learn in kindergarten: don't hit other people, don't take their stuff and keep your promises -- but most of life is governed by spontaneous order. It regulates how we choose our jobs, hobbies, lovers, recreation and most of the best of our lives. It runs most of the economy. The Soviet Union taught us what happens if government tries to plan the economy: people starve.

Something similar happens when I try to "govern" the skating rink (I shout orders with a bullhorn). Skaters hate it. Some fall down. I suppose a politician would say I failed at "leading" the rink because I'm not smart enough, I don't know enough about skating, so we need to elect a more expert leader. So I get Olympic gold medalist Brian Boitano to take the bullhorn. He does no better than I.

The moral: Intuition leads us to think that complex problems require centrally planned solutions, but political decision making is rarely the answer.

Government fails even when Americans clearly want government help, like after a disaster. Compare Walmart's response to FEMA's after Hurricane Katrina. Walmart got water to people while FEMA bureaucrats dithered. Was FEMA's failure Bush's fault? Was it because "Brownie" didn't do "a terrific job"? No. All governments make mistakes like that.

I interview New Orleans Mayor Ray Nagin, who acknowledges it, saying "Government is the PROBLEM, at all levels."

Nagin says he's improving things. Has he? In the worst hit part of his city, most homes still look like wrecks. Why haven't they been rebuilt? Partly because before people are allowed to rebuild, they must get government permits. Getting one can be a nightmare. I try Nagin's automated permit kiosks. They didn't work.

Amid the devastation in New Orleans, there are pockets of beautifully rebuilt homes. It turns out they were rebuilt in spite of government, by private charities, like Habitat for Humanity. Brad Pitt, Michael Moore and Harry Connick Jr. helped. It's the spontaneous order.

Nagin, when confronted about New Orleans' failures, said, "You guys in New York City can't get a hole in the ground fixed. And it's five years later. So let's be fair." Nagin has a point. Even the city that never sleeps can't manage to rebuild at ground zero. They've tried for seven years. Yet right next to that horrible hole in the ground is a brand new building. It was built in half the time it's taken governments to build … nothing. How did it get built? It was financed by a private company.

Yet people still thrill to hear politicians' magic "solutions." Even McCain's opponents praise him as a reformer for campaign finance reform, which promised to get the big money out of politics. Yet campaign finance law, like all our government's laws, is subject to a still more powerful law: the Law of Unintended Consequences. Campaign finance "reform" has actually made it harder for the little guy to have his voice heard.

We interview one little guy, Dr. Ada Fisher. She ran for Congress on a shoestring budget. Her staff was entirely composed of unpaid volunteers. They tried to obey the rules, but campaign finance laws are so complex -- I taped the pages together and stretch them out at New York Giants' stadium; they are longer than the length of the field -- that they were unable to get some forms filled out in time. They ended up being personally liable for $10,000 in fines. They didn't have it. Says Fisher: "The system is rigged for incumbents and against challengers, because incumbents already know the game. They have gamed the game to win."

I tried filling out some Colorado campaign finance forms. I couldn't. One political science professor asked 200 educated people to fill out sample forms. No one completed all the forms correctly. One young man told us the forms killed any interest he had in elective office: "I'd rather just not get involved in the process if I have to go through the nonsense that I had to go through today."

McCain declined to be interviewed about his revered "reform," so I confront three reform supporters. Cecilia Martinez, who works for a campaign finance reform group once headed by McCain, said the campaign forms are "very simple." Paul Ryan, who works for a group founded by McCain's campaign lawyer, told me, "This is really good. I'm happy to see that the state of Colorado is doing this much to help people understand." But when I asked them to show me how easy it was, and fill out the forms then, all declined. Ryan sent in his correctly, but not until a week later.

For all its complications, what has "reform" accomplished? Just as many congressional incumbents win elections now than did during the Watergate era. Obama has backed out of public financing so he can keep attending $20,000-a-plate fundraisers. McCain skirted his own donation limits. Today there's more money in political campaigns than ever.

Enough on McCain; it's Obama's turn. He supports farm subsidies, saying that America has "farms to save." McCain opposed this year's $300 billion farm bill, calling it "bloated" legislation that "will do more harm than good," but Obama supports it. The bill spends huge amounts of money and fails to accomplish its goals. It was supposed to save small farmers and small towns. Instead it fuels the expansion of industrial megafarms and the depopulation of rural America. A study from the Federal Reserve Bank of Kansas City shows the more federal farm dollars a county receives, the more likely it is to lose population.

Congress' protectionism has other unintended consequences. Food costs more because farmers are paid NOT to farm. We use home video cameras to show how real estate agents sell homes to non-farmers by promising "farm" subsidies.

Yes, its true that without subsidies, some farms will go out of business. "That's OK," says economist Walter Williams, it's the creative destruction that makes America strong. "When there's progress, certain jobs are destroyed and certain jobs are created," says Williams. "The guy who used to deliver ice to my house no longer has that job. If we had tried to save his job, America would have been held back."

But Obama still wants to spend your tax dollars to try to keep farms in business. So far, it hasn't worked. Today Obama and McCain advocate similar subsidies to try to protect auto companies and big banks. How well is that working for you?

Listening to the media and the political class, you'd think the election is about who will "run America." But politicians don't run the country; 300 million free individuals run the country. "We don't appreciate the things that we do on our own that are not designed by anyone but still get solved. We naturally assume that good stuff that happened must have been caused by someone -- the president, a planner, an expert. We forget solutions emerge without anyone designing them," says Russ Roberts, a professor of economics with the Mercatus Center at George Mason University.

David Boaz, senior vice president of the Cato Institute, points out that most change doesn't come from politicians. "It comes from people inventing things and creating. The telephone, the telegraph, the computer -- all those kinds of things didn't come from government. They came from people. Most of life -- our families, our romances, our jobs, our travel, our learning -- is outside the government sector. We think sometimes of government as being so important -- and it can interfere in our lives in a lot of ways -- but if the government just protects us from rapists and murderers and foreign armies, and leaves us alone to run our own lives, we'll be better off."

Amen to that.

Here are some edited comments on my latest column, "The Reregulation Mantra":