Schwartz: Exactly, yes, you starve government out. That's exactly right. That seems to be the model. Let me just say, there's an economist, or at least there's someone who writes about economics, name Jeffrey Madrick [http://www.jeffmadrick.com/], who's recently published a book that is a passionate and extremely well-argued defense of big government. We simply have forgotten all the good stuff that government does - we just take it for granted. And what we notice is the lemonade story. We don't notice that we can buy a container of milk and be reasonably confident that we're not going to get food poisoning if we drink it; that the prescription drugs that we buy, the pills in the bottle are what they're supposed to be and they meet production standards.
Kall: And the example of where things broke down when that didn't happen is this American Peanut Company, which was not evaluated and regulated.
Schwartz: And one reason why it wasn't is that they starved the FDA. There are ten times as many products now as there were, and they have the same size work force, so they can't do the job. They don't have the wherewithal to do the job. So, 99% of the time, all this stuff works. You take government away and bad stuff starts to happen. You take government regulation away from the banks, bad stuff starts to happen. We have just taken it for granted... all the positive contributions that government makes, we have just taken for granted. As if, if you starve government, those things won't continue to happen anyway.
Kall: Now, two questions. One is: What's the book by Jeffrey Madrick?
Schwartz: I don't remember the name of it, but M-A-D-R-I-C-K. I'm quite sure that Google or Amazon will be happy to tell you.
Kall: And the other question is: How do you answer someone like Bobby Jindal saying, "Well, government's bad because there was a problem here with these boats?" How would you answer that?
Schwartz: I think it's ludicrous. I don't think it warrants an answer, it's not a serious complaint. Good institutions occasionally produce mishaps. Running a society is complicated business and sometimes things go wrong. Sometimes, regulations that protect people also prevent people from doing the right thing. That was part of what the lemonade story was about. But on balance, it seems to me, the fact that occasionally there's a rule that makes it so you can't do what's obviously the right thing to do doesn't mean that these rules in general have that effect. So I just don't think that this is a serious position that's worth arguing about and to make these claims in the face of complete financial collapse that has occurred as a consequence of getting rid of the rules... I mean, I don't understand how people can look at themselves in the mirror. It wasn't government regulation that screwed up the financial system. It was, you know, "wild west capitalism," anything goes.
Kall: So what do you think; they're lining up Jindal (Republican Governor, Louisiana) as a potential presidential candidate in 2012. His characterization of government -where do you think that defines him?
Schwartz: I think a lot is going to depend on whether the various dramatic efforts that are now being made have measurable effect before the next presidential election; I think I f they do, the Republican Party should fold up its tent and go away. They will get sooo trounced in the next presidential election, that there's no point in showing up, because it's quite clear that they have been nothing but obstructionists- so far, and the only proposal they have is to do exactly more of what was done for eight years in the Bush Administration. So barring a complete failure of Obama's efforts to get the economy working again, I can't understand who would vote for a Republican.
Kall: Yet, at the same time, your story about Mike's (Hard) Lemonade suggests that too much blind dependence on regulation can be problematic too.
Swartz: I think that's right; I think that there are no rules and there are no incentives that can substitute for people having good character. Good character is essential, it needs to be nurtured, but there is nothing about sort of turning people loose, as free market self-interested wealth maximizers is going to do anything to nurture good character.
Kall: As the publisher of OpEdNews.com which sees about half a million unique visitors a month, I find that we have to remind people fairly regularly to be civil. Because in the discussions and the comments, people can get pretty mad. Sometimes you just have to remind them and then-- they remember (chuckles).
Schwartz: Well, here too, I think that what's happened is that the 24/7 cable news cycle with almost all of the shows now, opinion shows, rather than news shows, has just created a set of models where being uncivil is what gets viewers. There are people on both the left and the right, although in my experience more on the right than on the left, where the point is to be as nasty as possible.
Kall: Oh I can assure you that on the Left there is plenty of nastiness too.
Swartz: Oh, I know; I'm sure there is; the folks on the right tend to have more, have better ratings, (laughter) but it's just gratuitous nastiness. It's caricaturing the positions of your opponents because the point is to win and to disgrace your opponent rather than to get some clarity, or understanding, or anything. So these are the most, sort of cynical excuses for serious inquiry, and they become the model. The standard is how fast can you insult somebody. Somebody says something you don't like and right away you go nuclear. There is nothing going on that encourages civility right now in modern America-that I can see.
Kall: Well, maybe that's something else that will be changed as we go through these crisis times where we have such opportunities for making change.
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