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-- a management and budget in the Reagan administration he was worried then about the state of our nation.
But his worries have turned into an indictment of our nation's leaders who he says -- been for decades making mistakes one after another.
To the point where our nation is broke.
-- my recent interview with the former Reagan budget chief and the author of the great information the corruption of capitalism and America David Stockman.
David it's and it's it's a big book but I'll tell you something.
I love this book.
It's it's it's really.
That document date might take all summer read the thing but it will be to kind of -- read you start -- -- the start with the top of the book you start off with a Blackberry panic of 2008.
What you you aren't happy about what happened.
-- that's really what motivated -- write the book I think it's the rubicon because you had a Republican White House.
Who basically threw away every principle of free markets and of financial responsibility.
And fiscal rectitude for that matter to the Republican Party ever had.
They allowed Hank Paulson on the third floor of the treasury with all his golden -- To basically do any thing that was necessary to bail out the remaining firms on Wall Street.
And I go through it and I demonstrate the rationale they gave was not true.
It consisted of urban legends that I think after the fact we can document.
We're gross exaggerations.
If they had any reality at all we weren't heading.
For a depression 2.0 this was not going to spread in my view be on the canyons of Wall Street.
AIG was not a contagious disease it could've easily been put into bankruptcy the main street banks the community banks in the nation were not in trouble.
Because they did not engage in this kind of gambling.
With a derivative securities and CEOs in the mortgage backed sub prime I -- and so forth.
So I think what I was trying to do is set the record straight and unfortunately.
The Republican Party destroyed its reputation doing this why would they believe this anymore.
-- Republicans when they say free markets out of the way we have to run our economy if we bailed out G down AIG.
And Wall Street and Goldman Sachs effectively in Morgan Stanley on the Republican watch terrible point in history.
I would remind people that not only in the introduction we talk but of course about your -- your name came up on a national basis -- you were budget director in the Reagan administration.
But after that you went to Wall Street and worked on Wall Street so you.
No the inside of Washington -- Wall Street to two places that people seem to not trust anymore.
Yeah those -- the seven words that you can borrow my -- large book down to.
Do not believe Washington or Wall Street.
And there again paddling a lot of illusions.
That everything is fixed everything is better and it's not.
The -- is -- serial bubble machine it's -- lady this view huge financial bubble.
For the third time and I think we're heading for another spill just like within dot com crash just like with the housing.
And the Wall Street crash that we had in 20720.
Wait it Z you know in -- from the Fed is the largest threat.
To the future of our economy and have sound prosperity.
That you can imagine and I regret to say the people running it today Bernanke and before him Greenspan.
We're appointed by Republicans this is why.
I fear for the future of the country because we have no Conservative Party left economically.
Both parties are using essentially free lunch economics.
You've been making people.
Within the Republican Party.
And the Democrats mad at you for as long as I could remember back even -- the Reagan days you sound a little bit like Ron Paul.
Where I'll tell -- I've made the Democrats -- in the Reagan days because I called attention to the fact that spending was out of control.
And that we needed to free up our private economy and let it breathe and let it grow that's why we wanted to rate cuts.
But unfortunately we didn't have enough troops on the Republican side to cut the spending.
To shrink the welfare state Ronald Reagan left -- almost the same size as he founded.
But we did have the big tax cuts and that's where we got.
Deficits out of control and the myth that developed.
That deficits don't matter and so now I have to really call out the Republican Party.
Because the three things that they stood for historically free markets.
Fiscal rectitude and sound money all three of them have been repudiated.
By several Republican administrations.
And several generations.
Of Republican politicians on Capitol Hill well in the last couple years.
You go back to me you've got FDR you've got Nixon you've got you shadow a whole crowd you've got Fed Chairman you've got just about everybody.
In the indictment so there's a lot of people Davis that are.
In the Washington I'm political economic world there and they're calling you every game out of the book pitcher Randy years ago all kinds of things what's your reaction to all -- -- -- Wellemeyer -- my reaction is that I'm not surprised because I believe we have a consensus in Washington.
That's based on policies that are going to take us right over the edge.
Massive deficits that they don't want to do anything about they just like to argue about and point fingers at each other.
And the idea that we -- allow a -- central bank of twelve people sitting on that fed board today.
To basically run the economy they're basically a monetary Politburo.
-- have more power over in the US economy and of Wall Street in the financial markets.
Than the old Soviet Union -- I'm -- ever had itself.
And when we break down the financial system we make interest rates simply -- numbers that the Fed picks out of thin air.
Which is how we get interest rates today as well -- -- and demand that yet that's -- the markets everybody's mad about that.
Because I'm really calling out the fact that we're in a bubble I'm also calling out the fact that there were -- heroes historically.
Along the way starting with Calvin Coolidge who actually believe in balanced budgets started with -- Eisenhower who did it again.
Adding a great secretaries of the treasury like Bill Simon who did fight in the seventies to cut budgets Volcker stopped inflation.
And even at the -- we had Republican appointees like Sheila Bair.
On the -- who tried to stop the bailout and the Goldman game.
From bailing out their own chestnuts and of course was just ignored in -- -- decides so -- -- a great historical struggle.
And the three principles that are so important fiscal rectitude free markets and sound money or losing and that's why our economy is in such great trouble.
Well it's I think it's an important book I think it's one everybody should read.
The great defamation corruption of capitalism the David Stockman thank you so much for being on the program.
Enjoyed being with your thank you you.
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