Blogging John Stossel's Speech Before Universidad Francisco Marroquin

January 14, 2008

Right now I'm listening to a speech by ABC's John Stossel before the Universidad Francisco Marroquin (UFM) in Guatemala City. Although you probably haven't heard of it, it's one of Latin America's shining universities. In a region increasingly dominated by the likes of Hugo Chavez et al., it's a welcome voice among the crazies. Perhaps that's why Milton Friedman once said of UFM that it is "...a first-rate university that is having a significant effect on the climate of opinion in Latin America. I know of hardly any comparable success story..."

Who could fail to love a place that calls itself la casa de libertad -- the house of liberty. Build that house up, friends, and invite me over. Maybe Claremont McKenna should consider a cultural exchange? We teach the U.Chicago model, they try and live it in a country that just elected a left-leaning politician. Good luck. A cultural exchange might not be such a bad idea. We already have a lot in common. Claremont McKenna professor, Arthur Kemp, gave 700,000 dollars to UFM and earned himself an honorary degree in 1981. UFM's founding president's name, Manuel Ayau, might also sound familiar. He's written six books and his work has appeared in the Wall Street Journal. He writes a weekly column for Prensa Libre, the daily Guatemalan newspaper.

Back to Stossel. John Stossel, who also received an honorary degree from the university, explained how he became a libertarian. He won 19 Emmys criticizing business practices, but the regulations he advocated didn't work.

Stossel's one of the few libertarians we have in the national media. Stossel's a co-anchor of 20/20 and will be interviewed by my uncle, Carlisle Johnson, tomorrow. My uncle is the host of the number 1 show, Good Morning Guatemala. (We're seeing about setting up a website for him while I'm in Guatemala.) I'll link up the interview with Stossel when its put up.

Introduction by UFM sounds like a rehash of Wikipedia post, but never matter. On to Stossel! His remarks follow his book, Myths, Lies, and Downright Stupidity. Get Out The Shovel -- Why Everything You Know is Wrong.

Here are my rough notes, written in the present tense. I'll try and keep my own personal comments to parenthetical sentences.

Stossel explains the subtitle of his book. He explains that so much of what he thought has turned out to be wrong. Some of these things defy common sense from silly things like your mouth is cleaner than yours, these things permeate the common mind. Some of these things, like global warming, are backed up by flimsy evidence.

Another example includes second hand smoke is harmful. Stossel explains that he isn't a smoker, so he kind of likes the regulations against smoking, but he's troubled by the principle. He asks, Does the majority get to dictate to the minority everything? Can't smokers have some bars? The justification is always safety, to protect the public good. The evidence is so flimsy. The truth is that the dozens and dozens of studies. Those studies were done with people who had lived with smokers all of their lives and even then, the effect of second hand smoke was only slightly more noticeable. Do we really need all that government regulation? Is thinking we need government regulation one of these things we believe without good enough evidence?

These smoking bans and other regulations come from the Totalitarian Left. Stossel gets in a dig about Chavez and the new president, Alvaro Colom. The crowd, mostly free marketers, laughs. Chavez, who yours truly got to see come into the Western Camino Real hotel, spent the day in Guatemala to attend the inauguration and manipulate the media.

Stossel proceeds to explain why economics is not intuitive. He says, "We like planning. It feels natural that the government should plan the economy. It took people like Hayek to show why that was wrong. I, like you, try to teach Hayek wherever I can." The crowd applauds. Stossel knows that FMU loves Hayek.

Stossel asks rhetorically, why is a country prosperous?

Stossel shows a clip from 20/20 asking just that. In a segment called, Is America Number One? Stossel went around looking at business practices in other countries. He compared how quickly one can open a business in Hong Kong -- you need only one form --and how long it takes in New York City.

He then talked about an interview he did with Milton Friedman where Friedman says that the one key ingredient for prosperty is freedom.

Stossel asks, "What is freedom? Democracy alone does not make a country prosper. Notice India. Standard of living in India is less than Hong Kong, which is governed by a government interested in benign neglect. In Hong Kong, there is miminal government, no Federal trade commission and no minimum wage.

There isn't any reason Hong Kong should be richer than Communist China. The island is just a rock without even any drinking water."

Stossel launches into an examination of economic freedom index. He points out that Guatemala is well ahead of Venezuela's level of economic freedom and that it's a tragedy that there are so many Guatemalans that want to emulate Chavez's Bolivarien state.

Why don't people get free trade? We have seen what works and what doesn't.

Guatemala adoption agency is a good example. They want the government to come over and make it better, despite all the failures of government. (There's been a big scandal in Guatemala over the adoption agency. I ask him a question about it later.)

Stossel talked about his beach house, right on the water, and how he bought federal flood insurance. Stossel argues that this insurance is wrong because it transfers his risk of building on beach front property to the American citizens. He had American taxpayers pay to rebuild his house when the ocean came and washed it away several times.

He discusses how the media often allows this kind of wasteful government intervention by encouraging government action. The media encourages crisis-mongering. Life spans have increased thirty years. So take that Michael Moore!

He goes on to list the crisises that weren't and how they all are scare tactics designed to get people's attention. These include, Y2K, SARS, West Nile Virus, and bird flu. Chemicals, like DDT, are the big scare. Never mind that DDT doesn't really affect people negatively and that not using it means roughly a million people die annually from mosquito-born illnesses.

Stossel lists global warming as the biggest new scare. He doesn't dispute global warming. He just says that there's no need for government intervention.

Perfect is often the enemy of the good. Why, for instance, must we insist that things be perfect?
Government systems build mediocrity and the constant failures of the state.

In referencing the global warming debate again he says that driving Priuses and changing light bulbs won't do anything.

He has another great line: We like to be alarmed. It's kind of like a religious experience for the non-religious.

They claim to be working for the poor, but the poor always suffer most from the schemes of the utopias. If totalitarian leftists had their way, we would ban swimming pools. After all, 800 people in the U.S. children per year killed by swimming pools. Cars wouldn't be approved. Airplanes wouldn't be approved. All of these regulations retard the development of wealth.

The most important extender of life is wealth. Poverty kills. If you are poor, your life is 5 to 7 years younger. Poor people cannot buy the good stuff. Wealthier is healthier. Economic freedom makes everybody's life better.

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The baby question: I ask, should Guatemalans sell their babies to the higest bidder? The crowd shudders.

Stossel responds -- "The baby selling scare stories abound in the U.S. press. Only five of those stories turned out to bee true. You can easily police against that. The new Guatemalan bill has allowed DNA tests so you can guarantee that people are voluntarily giving up their children.

On a moral point, though, if a woman wants to sell her baby, I think adults should be free to engage in commerce. I am grossed out by a woman selling her child. That's better than thousands of children suffering without parents, which I fear will be the end results of a big government program."

(gets applause from the crowd.)