“I’m a libertarian,” John Stossel proudly proclaims. “But I don’t often say that except to an audience like this because the term libertarian is confused with ‘libertine’ or even worse, “liberal.'”
Addressing a lunch meeting of the Chicago-based Heartland Institute, a libertarian-leaning think-tank, Stossel faced an appreciative audience ranging from school teachers to business executives who share his opinion that the least government regulation is the best. It’s a point he’s made in his witty new book, Give Me a Break … How I Exposed Hucksters, Cheats, and Scam Artists and Became the Scourge of the Liberal Media, (HarperCollins, 294 pages, $24.95).
You know Stossel from his reports on ABCs 20/20 and his prime-time ABC television specials. But Stossel — a 1965 New Trier High School grad — takes us back to his start as a television consumer reporter in the early 1980s.
|Heartland Institute promotes free-market solutions
Joseph Bast is president of the Heartland Institute, a 20-year-old non-profit public policy research organization that brings together conservatives and libertarians to address public policy issues, such as John Stossel’s presentation.
Heartland’s reach is national through its policy studies and monthly newspapers on topics such as school reform, free-market environmentalism and consumer-driven health care. Its Web address is www.Heartland.org.
The Heartland Institute, which is based in Chicago, is not a particularly political group, and it doesn’t make endorsements. But more than 350 elected officials serve on its issues advisory committee. Heartland’s goal is to encourage free-market, non-regulatory solutions to social and economic problems.
For example, Heartland has long supported medical savings accounts as a way to encourage consumers to purchase health care services wisely. And it supports school vouchers, saying in one paper that it’s “blatantly unfair for the children of politicians to attend private schools whereas the children of low-income parents are stuck in some of the worst and most dangerous public schools in the country.”
“When I started, there were few rules. We made it up as we went along. To catch the bad buys, we resorted to elaborate deceptions,” he says.
He tells of having a producer pose as a cosmetics manufacturer to prove the point that some expensive designer makeup brands used exactly the same formulas and manufacturing plants as cheaper drugstore brands.
As a consumer reporter, Stossel was proud of exposing businesses and con men, ambushing them with his TV crew, and sending some of them to jail. But over the years, he came to a startling realization:
“The more reporting I did, the more it dawned on me that government is often the problem rather than the solution. Free markets, not coercive governments, are the consumer’s best friend. The people who are really ripping us off are the lawyers, the politicians and the regulators. The evidence was in the stories I’d been reporting all along. It had just taken me 15 years to see it.”
It was that change of heart that changed his life, as he explained in his talk and in the opening chapter of his book.
On being TV’s libertarian
“I was once a heroic consumer reporter. Now I’m a threat to journalism,” he announces wryly. “My colleagues liked it when I offended people. They called my reporting ‘hard-hitting’ and a ‘public service.’ I won 18 Emmys and a lot of other journalism awards.
“Then I did a terrible thing. Instead of just applying my skepticism to business, I applied it to government and ‘public interest’ groups. This apparently violated a religious tenet of journalism. Suddenly, I was no longer ‘objective.’
“These days, I rarely get awards from my peers. Some of my ABC colleagues look away when they see me in the halls…. People now e-mail me, calling me a ‘corporate whore’ and a ‘sellout.’
Stossel goes on to describe his “conversion.”
“After I spent time with the victims listening to their sad stories, I was angry. I wanted someone to help these people. What was the purpose of government if it couldn’t protect them?
“Occasionally the government did act, but its actions rarely worked out well. Every regulation seemed to have an unintended consequence. Taxpayers’ dollars wound up in the pockets of the rich instead of the poor. Well-meaning regulations designed to protect consumers often hurt them by narrowing their choices and raising prices.”
You really need to read this book to see the hilarious yet tragic examples of Stossel’s point.
For instance, there was the inner-city hair-braiding business started by two African Americans. They were doing a booming business until local government licensing regulators insisted they spend time and money to acquire beauticians’ licenses — even though they didn’t shampoo or color the hair they were braiding. Result: They were put out of business.
Similarly, the two elderly ladies who knitted sweaters and mittens for sale at the local markets were told that “no businesses are allowed in the home.”
Or the ladies who baked muffins, or the grocery store that hired bag boys under the age of 16, or the man who decided to sell caskets direct to families at a discount to the cost at funeral parlors.
All were put out of business by regulations.
On the impact in Chicago
In Chicago, Stossel points out, the cost of regulation hit the very people it was designed to help.
“When Chicago decided to repair the Cabrini-Green housing projects, people who lived in the project assumed such a big job would provide work for the unemployed young men who grew up there. … But because of Davis-Bacon [a law passed in 1931 that sets wages for government construction jobs at the highest prevailing level] every contractor had to pay high salaries — even for the simplest jobs. Locked into paying high salaries, contractors were not about to take a chance on beginners. Instead they hired the most experienced union workers they could find” — none of whom lived in Cabrini-Green.
It’s just another case of government regulations that may have been designed to help people, but instead wound up having the exact opposite effect.
Stossel makes a comparison between what government tries to tell us to do, and the rules it applies to itself.
“Government almost never polices itself. When government agencies lose money, or fail at their missions, they ask Congress for more money. They usually get it, citing their failure to achieve their goals as proof that they need more funds.
“There are now 150 government agencies with more than 5 million employees who spend most of every day searching for ways to protect us, make something more ‘fair,’ or just help their friends. Every year they churn out thousands of pages of new rules. But again and again, the experts’ schemes go awry.
“They don’t see the unintended consequences . . .[and] they insist on maintaining control even when they fail, and fail again.”
On changing things
Stossel doesn’t just complain. He has a few suggestions. Here’s his solution to the problem of runaway lawsuits: “The party that loses a lawsuit should pay the other side’s legal costs. The losing lawyer should pay, too.”
It’s a concept that works well in the rest of the world, he points out. And in response to complaints that the loser-pays concept would deny people access to the courtroom, he counters, “We deny people access to missiles because missiles are destructive; so are lawsuits.”
While Stossel acknowledges the role of government in protecting our country, he feels it should be limited — and cost less.
“Government should stick to what it needs to do: set basic safety and environmental rules and keep the peace. Otherwise government should leave people alone, Stossel proclaims.
Even if you disagree in whole or in part, this is a book that will capture your attention and leave you reflecting on issues that touch all of us. And I’m sure you’ll wind up saying, as Stossel so famously does: “Give me a break!”
And that’s the Savage Truth.
Terry Savage is a Chicago Sun-Times columnist, a registered investment adviser, and a member of the board of the Chicago Mercantile Exchange. She appears weekly on WMAQ-Channel 5’s 4:30 p.m. newscast, and can be reached at www.terrysavage.com.
This article was first published by the Chicago Sun-Times on February 15, 2004. It can be found on the newspaper’s Web site at http://www.suntimes.com/output/savage/cst-fin-terry154.html.
Copyright Terry Savage Productions