Could you help me with that? Could you help ba- it, it, it help either back up or deny it? I mean, did, did I, was I kinda wrong there? Was I right there?

Yeah.

It's, it's a good thing to, to pause it right now with so much going on in the news and what's different between capitalism and socialism and, and everything else, so I think it's a really good topic to bring up.

Um, my perspective is a little bit different.

Um, you know, capitalism is really just the ownership of the means of capital, labor and capital and, and that sort of thing, by individuals.

So individuals have private property rights, and so you need some form of government to uphold those private property rights and a justice system.

Very limited government overall.

... let's strip government of every bureaucratic piece of red tape and go to straight free markets."

Do you agree?

I agree with you with that, Joe.

I think they should be doing a better job.

I felt like there was, you know, and there's some things that the administration, Trump administration is doing a much better job than, of course, the Biden administration is on deregulation.

And we just don't hear them talking about how much they're deregulating, what the costs are, how that's reducing those costs.

But...

And I'm not sure exactly why that's the case, because in the first administration, as you mentioned earlier, that I was a part of, that was something that we hammered a lot.

Can you tell me why Warsh, the guy that was handpicked by President Trump, decided to raise the interest rate? Would you have agreed with that move?

So our population also grew, which of course is, as you spoke in the beginning, that's a big goal.

Yes.

Yeah.

Especially when we've seen people who are leaving for so long, year after year after year, right? In the year of 2024, I believe it was, Louisiana lost 0.6% of its population, which was the fourth worst in the entire country.

And so that's not a good sign when you start to see that.

And as a percentage term anyway, right? You usually hear about California having a net negative migration or New York.

Right.

Yeah.

Is that the right way to pursue this?

Well, there's a lot going on here, Lars, but I mean, when you look at the higher interest rates that are right now and he's wanting to lower them, one thing that you have to ask is, okay, what does that mean? Well, what that means is that the Federal Reserve would need to print more money, buy more bonds on the secondary market, and then push more money out into the economy.

And that helps to bring down those interest rates when you increase the demand for bonds.

But if you have more money supply, then you're likely to get more inflation.

And that inflation is what's really been hurting this affordability issue across the United States.

And even in August with the latest jobs report, it showed average hourly earnings were up about 3.1%, but inflation is running 3.5% year over year.

So people are falling behind.

That's a chunk of spending right there, isn't it? But is it big enough?

Yes

... a free banking system, not the central bank, a monopoly over currency.

But it would take some time to, uh, you know, remove that liquidity, remove those purchases that are on the Fed's balance sheet today of mortgage-backed securities, of Treasury debt.

Y- if you just dump those into the market, interest rates on mortgages would soar to 10, 11%, you know? And Treasury security yields would soar.

So I think you would have to have a, a, a, where, where it would just slide down over time to where you would get rid of those assets, and then you could eliminate the Fed.

But I think we should start that sooner rather than later.

And, and one thing I would mention, Joe, is we have a new chairman, Kevin Warsh, who just had his first meeting last week, and he has talked a lot about reducing the Fed's balance sheet as that being a major cause of distortion in our economy-

Yeah

Could a local county or city abolish its property taxes or does this almost always have to be done at the state level?

Yeah, it's a great question.

And before we go on to that, too, I do believe strongly in federalism.

There's laboratories of competition.

So I liked your idea of where you're heading with that to have this competition to where you don't have so many nuances and taxes in each state.

I mean, that can be helpful to some extent, but usually it's more burdensome.

And we see that people flee places that have high taxes, like California, New York, Illinois, to places with lower taxes.

So maybe talk about Are there some examples where this is actually being done currently in the U.S.? I know there are a lot of places talking about it, but do we see examples of it? And then also from a historical perspective, what does this maybe look like in a different era?

Is he still going to be on the board? And if so, why can't a president who appoints them get rid of them?

Yeah, for your latter question, I mean, that's just part of how the Fed policy works and the laws that were set in place back in 1913.

And they've changed some over time.

But basically, you have a term that he was already on.

Jerome Powell was already on the board before that, right, before he was Fed chair.

So he can serve out the remainder of his term as one of the governors.

he has said he's going to so i think he'll still be on the board but that also means that the president can't just remove him given those laws now maybe you could change the laws and do something else then that's a whole different story but as far as i can see right now jerome powell will remain on on the board as a governor and kevin warsh will come in as the fed chair which you know you know joe i'm really excited about kevin warshe he's been talking a better game about the federal reserve's balance sheet which is what i've been focusing on for a while which is still like like $6.7 trillion, about 21% of GDP, that's got to come down for us to have less distortion in the markets, less inflation throughout the economy.

And is it working?

Yeah, sure.

And then we can, you know, go to some of the optimistic.

Um, the, the big things that I see right now when I think about an ec- economic growth and free market capitalism, property and all that, right, what you need are labor, and you need capital in order, and productivity for an economy to grow.

And in order to do that, you need to have exchanges that can take place, that we talked about earlier, voluntary exchange.

You need to know what the rules of the game are, which we can have limited government contract law and stuff like that.

But something I think that's really [sighs] is struggling for me right now to, to find out, like, where this is all gonna end up, I don't know what the end game is gonna be, is on trade, and the protectionism and the tariffs and everything else that's going.

Let's not talk even about the unconstitutional aspect of it from a g- from a president doing as much as what Pr- President Trump has done, but even Biden did this a lot, too.

Would you dispute that either that's happening as they're claiming, or that it will be as effective as they're claiming?

Do we ever get to a zero inflation? Do we ever get to a deflation place? Will the dollar ever gain value back? How does that work?

Well, I think it should, but it's unlikely that will happen just given the different dynamics of what really creates inflation.

And what creates inflation is too much money supply.

Milton Friedman said inflation is everywhere and always a monetary phenomenon, meaning that when the money supply increases more than goods and services across the economy, you're going to have more inflationary pressures.

And that's what we've seen over time.

And it's created directly by the Fed.

Of course, Congress contributes to that though, because what do they do? They spend too much money.

I

Did I describe it right? Are they doing that in all the blue states where they're fake taxing health care providers, then just giving them the money back from the feds?

Yeah, no, there's a lot of truth to that.

And I don't remember how many states are doing it, but I know California is definitely doing that because they actually passed a bill that said that they were going to fund illegal aliens in Medicaid.

And so you're right.

They come in, they give these tax credits and other things that are going on.

They can also bring down more federal funds because the way that the way to make Medicaid works, right, is it was created in 1965 and it's funded mostly by the federal government and a lot of the operations through this, what they call federal matching assistance program.

So the state will pay for a small portion of whoever is eligible.

What do you think? Is he just looking to save face? Do you think Vance?

Did we balance the budget then? Was there a surplus then? Or to your point, were we still building the size of government even though we were spending less?

Yeah, I was actually talking to somebody about Bill Clinton today where I think he may have been one of the best presidents without the Monica Lewinsky stuff and some other things going on because basically he was more conservative.

I do agree with you, though, that the Republican Revolution with Newt Gingrich forced him into that direction even more.

But there were some good things that were going on at that time.

But there were these four years, was it 98, 99, 2000, 2001, right before the dotcom crash and 9-11 and all that, where we actually ran surpluses.

Now, if you look at the the micro, which is I would like to do is get into the budget and dig in there, Joe.

Yeah.

So what is that all about? Was there a specific moment in time when that happened as well? Let's just automatically put a baseline increase every year.

I think that's right you know one of the things I'm working on now is that we have with new technology and new science we have an opportunity to help Americans who are challenged and to literally move from a focus on disabilities to a focus on capabilities and in a sense liberate millions of people to have a much fuller life and a much more self-reliant life than we currently think about when we put them into sort of a disabilities category and that's an example of the transition we did this as you know when i was speaker with moving from welfare to workfare and the effect was enormous when the number of children who left poverty was the largest number in american history and it was because their parents were going to work which not only increased their revenue but it had the good virtue that children were learning that on monday it's okay to go to work and not just sit around and wait for somebody to send you a check so we were changing the whole culture the democrats to a surprising degree just hated they hated the idea of people being independent which i thought was truly bizarre let me go to a totally different topic for a second because you've written something i believe in strongly and would like to see the trump administration pick up and that is that we should index capital gains could you describe why you think that's important

important... is substantial (laughs) right now, when you think about your stocks or your housing value, other things that you may be taxed on whenever you get those realized gains.

That's based on capital gains taxes, things of that nature.

But that's when you realize it, when you actually have the amount of money coming into your pocket, and then you could pay those taxes.

That's one thing 'cause that's a source of income.

However, what we've seen within the capital gains and within the stock market and things of that nature, just to use that as an example, is that over time, part of the gains are due to inflationary pressures across the economy, meaning the Federal Reserve printing money and things of that nature, that are not real returns.

In fact, it's taxing unrealized capital gains over time because of that amount of inflation that's happening.

Tell us all just for a minute, because it's such an important long-term issue, about your book on health reform.