good heavens that were for this program at this problem. but i'm trying to suggest is when we in fact do have to cut back, it's not going to be a terrible catastrophe, the nightmare scenario. to the contrary from silver lining is that it will cut back on some of these things and will give a lot more scope for entrepreneurship and freedom. >> host: what is one of those budget items you could see being cut back that could be advantageous? >> guest: well, with a book like this in a publisher like mine, it is assumed that i am a right-winger and so i want to take the food stamps. i want to abolish everything, but to me you think the low-hanging fruit first. for me the low-hanging fruit is the pentagon. there was a time when i was a conservative and i thought if you want to cut the pentagon budget committee must be some comic that is america.

when you look closely come you got to understand the pentagon -- the department of defense is the only department not subject to audit. that doesn't mean that they feel the audit were good heavens look at all the the things we found. they are not even subject to audit. so what we've been figuring out piece by piece is for example since 9/11 in the nine years after 9/11, the pentagon budget when not. the increase in the pentagon budget was about to trying dollars during those years. when trying to the wars, but the other trillion, nobody quite knows where it went to. the air force has been scaled back. that may be spent scaled-back. the the army increased marginally, but it's budget was vastly increase. where did the money go? this is a crisis we are enduring this going to have to require liberals than conservatives to rethink some of their -- we examine some sacred cows and family can afford to say this is off the table.

nothing is off the table, but particularly the waste -- also it's not just that they've thrown on the money out the window. it's the way they do it because there are two techniques they used to sort of get the taxpayers to get going. so we've got political engineering, whereby once a program gets going, and missile program, weapons program, it doesn't matter if the enemy was made for no longer exists. it doesn't matter that the thing can work as promised. but you try to do is get the projects spread out among as many congressional districts as you can, particularly congressman who sit on appropriations committees. the profits and jobs get spread around everywhere. you can't ever stop it. the other technique is to vastly overpromise what it can do an underpromise with the cost will be. so you combine all these techniques can you get an

extremely unresponsive system. and meanwhile, conservatives say i don't believe anything the government says we've got to get things back. when it comes to the pentagon, everything they say is that holy scripture. this is just a recipe for bankruptcy. >> host: what is the myth of good government, the title of one of your chapters. >> guest: unfortunately, this would strike at the platitudes, which is government is there to provide indispensable services that we couldn't do without, couldn't provide for ourselves and government is composed by a large of public minded citizens who are just looking out for the common good. and i'm suggesting this is more or less a fairytale and but more accurately describes the we have our systems where people are seeking to increase or at the very least maintained their own power bases and increase budgets and authority.

and they began -- maybe they are thinking in the greatest public spirit. maybe they've so come to associate their department with the public good they can't think any other way. anything that increases the scope of my department is an improvement. they'll think of the interview we've got to spend every last dollar appropriated by the rice mixture is a fake if you do all that money. steve got to blow money on whatever you can. this mentality is everywhere. it is systemic. >> host: without government science funding, everyone would be an. >> guest: that's one of my lines. i believe this a long time because i was a free-market guy, but i say there are exceptions. that's not the extremists here. it's okay to have a have a free-market in cheese, but some things the market can't provide evidence that obviously science is one of those because you can't necessarily earning profit on basic science. it doesn't turn an immediate

profit. you can't always capture from science because your competitor will grab your discovery, they're for the science undertaken. this asserted the typical neoclassical model of how science will work in a free market. it's just not going to work. so i believe that, but it turns that this is not the case at all. and secondly, the old model resort to a diet centuries ago was the way science operates as you gather some data, examine it in many, but the experiments in the experiment either confirms or does not confirm -- provisionally confirms or does not confirm your hypothesis and that's the way science operates. basic examination and again that sounds possible. it turns out of this describes a science is working. impact this, the way it works is not discovery is coming from people arber surely work in a laboratory and my goodness, i discovered the steam engines. it develops out of people looking current technology,

practical people and seeing a need to adapt this to my needs and then they solve their problems on the spot. but apart of defense yesterday not long ago and said, how many great research breakthroughs came as a result of basic science, just starting from scratch in the laboratory? do that to 700 projects. the science comes from is applied science. so it turns out that there has been far more funding of science, the percentage of gdp by the air, research foundations, bequests, amateur science in the beach before we had income and estate taxes. governments have been far less generous towards the sciences than the voluntary sector of society was. this is exactly the opposite of what we would think. but so often we casually assume that things have to be the way they've always been. what i'm trying to do is to a bertrand russell recommended. once in a while you've got to

hang a question mark on things you've come to billy for a long time. >> host: thomas woods, what's the difference between a conservative and libertarian? >> guest: well, this is a tricky one in my heart is very much on the table here because i feel like i have sympathies in both camps. i identify myself as a libertarian. the libertarian has one basic principle which is nonaggression. you cannot initiate force against anyone else. i think a lot of people would agree that instinctively. of course you know it's wrong to clock your neighbor over the head, the libertarians take that to the logical consequence, which is the look at the initiation of violence against people who themselves have not initiated. so we consider it to be legitimate. a conservative is life, guest ideological. the conservatives deliberately released in the classical sense like edmund burke is

deliberately non-systematic. and i say that not as an insult because they have good reasons for being non-systematic. their view would be life is too complex to be reducible to the one libertarian principle or to be reducible to left liberal nostrand's that we can impose on the world. life is much to varying for this and we have to use experience and we have to use our knowledge of the past and then move cautiously so you see i speak with some sympathy at this point of view. they would do the libertarian is just a hopeless ideologue who wants to force the whole wld to conform to their one principle. but i guess my sympathy for the libertarian position is at least i can pin it down to that one principle, were sometimes try to identify who is a real conservative, what is the real conservative position is like nailing jelly to a wall. >> host: you write federal bankruptcy in short may turn out to be one of the best things

that ever happened to america. >> guest: i got in trouble for saying that. i think media matters. how did this guy say that. but when i say federal bankruptcy may be a good thing, let's think to the sense in which any bankruptcy is a good thing. the owners of a bankrupt firm are not happy about the bankers, but the idea of bankruptcy as you take a failing firm and retool, fell off the assets and then you see what good may come of it. so sometimes bankruptcy is the best thing that ever happened to reaffirm. that's the best thing that happened to american society in the sense that right now we've got interested are so entrenched that nothing -- doesn't matter which candidate you vote for an establishment candidate a or b. come you'll still get the same programs by and large. to get very marginal tinkering and you never get programs out of there until the checks are bouncing. that's the only way. i was talking about the job

corps, this relatively small budget program from the 1960s that persist to this day in the idea to get people job-training and go back into the market and find jobs. but the first had been abysmal. like most people -- about of the third people don't even show up to the program and of the ones who do, most of them never find work in their field or they wind up at a barely over minimum wage job in the program cost as much as a cost to put it back to harvard for a year. see what they clearly this is a failure. as for private-sector program, would be laughing at how corrupt the capitalist people are. but if it's a government program can we say of us just be they haven't spent enough money or whatever. so when i say this to my students, if one who says that the program fails, what is that persist quite at that there was a wonderful, beautiful naïve question. it persists because congressmen around the country will say this is a factor in their cap. i voted for the job corps cannot hope to bring helpful programs.

but no one asked is how many people ever got employed. i have a friend economist who did a study. how many of them trained somebody for a job he got in that state that year. the answer was one person. one person came through these programs. obviously there's got to be better ways of doing this, but were never going to crack through. there's so much entrenched bureaucracy run the job corps camile never chisel your way through it. it is a shame who's going to waste his breath. there's a whole much more concentrated benefit. hillside to the nail to keep those programs. so that is what a clean slate seems to be what we need. >> host: weary of freedom fest in las vegas. this is booktv on c-span two come attack in the thomas was

his most recent work, roll back cover. big government before the coming fiscal collapse. where does the fed fit into rollback? >> guest: good question. the fed is another one of these topics but again were sort of taught not to really think about, not to subject to scrutiny. again, one of these things just there for the common good. if you have a question about federal reserve, you're probably a crank. you might need some psychological evaluation. as of the most recent financial crisis come is harder to make that argument. people who clearly are saying are asking questions about the federal reserve. what is this thing? what does it do. it's not the institution that when we spontaneously have business cycles, the fed comes to the rescue and salsa program. it intensifies the problem and what we need to do is roll back the fed as well.

it is dead wrong and this is going to sound wrong. but when you look at how many economists frankly are in one way or another directly or indirectly on the fed's payroll, it is like a giant cartel, where everybody knows you don't speak ill of this institution. he went to get that research grant come you shut your mouth. nobody's going to bite the hand that feeds them, but the fed was responsible for this most recent financial crisis. this was a time when alan greenspan is pushing interest rates to super low levels and then telling people the fundamentals of the housing market are sound. should take out adjustable-rate mortgages. everything's going to be fine. london standards are robust. absolutely went right over there heads. whereas meanwhile the free market, which is blamed for the financial crisis. the free market was trying to say to people, stop doing this.

don't buy five houses of investments and you have no jobs -- the free economy was trying to put a red lights on this in 2001. stop, stop, stop. all you have is a hammer, everything looks like a nail. read our interest rates, but that over rate cuts. stop speculating and letting people do something else. don't they go get rich thing in your house. let interest rates go up. he wouldn't do that. he kept pushing them down. the set of lights being read, everything was green. this is a problem caused by the fed so it's about time we talk about it. >> host: thomas words, what of your other books are some of the other topics you've written about? >> guest: a few years ago i'd

melt down how "the new york times" bestseller wiretapped about what had caused the financial crisis because i pretty much the first book on the financial crisis that included the bailouts because if you're going to get a book out on this coming by to understand the whole world will have a book on this. i worked like an insane lunatic on this book, just to give the public something other than the paul krugman explanation of what happened. i talked about federal reserve, this topic that's getting a lot of coverage these days. the austrian school of economics as this. what are their economist on there was a financial crisis coming? were they using a board, crystal ball? how did they know. i've written a lot about u.s. history. the first-time c-span covered me , which is one of these books, my favorite c-span memory bethesda barnes & noble to do a

book signing. i forgot to tell me c-span is coming. i thought i would cosign a few books and go home. i get there in the miniature destroys that c-span is setting up over there. but i'm sorry, what? so i had to spontaneously come up with our stock on the spot and it went great. i came to the conclusion that for no one but should not script any of my talks. >> host: what is your background? >> guest: educationally bachelors from harvard and a phd at columbia in u.s. history and backtalk him and then is senior fellow at the institute and i pretty much run my own educational thing called liberty classroom.com because now that we live in this revolution, it's a revolution that makes gutenberg look like a lazy bum, but everyone cannot have his own blog beards i teach u.s. history to anyone who's interested in learning about it through that site. so i keep busy.

you have to have me on for another show. the yes indeed. >> host: is it advantageous to live outside some of the major cities of the u.s.? >> guest: it could be. we miss living near new york city. obviously we haven't had a severe crisis, which i hope we don't have it could avoid certainly. i am not sure that large population centers are where somebody would want to be. and obviously this is not my windows, but if they were really bad attack of one type or another, we don't live in a concentrated area. there are advantages. >> host: we have been talking with thomas woods junior on his book published by regnery. "rollback" repealing the government for the coming fiscal collapse. this is booktv on location in

las vegas. >> host: here on booktv on c-span 2, we want to introduce you to author elizabeth ames who has written a book, "how capitalism will save us". elizabeth ames, first of all, tell us about yourself and your personal experience, particularly when it comes to economics. >> guest: okay, i've been a financial journalist, but i've also been on both sides of the press release. so i started out as a journalist and had my own pr business and also done projects, other communications projects for clients. among them, co-authoring the book and basically and

conversations led to the idea for this book. >> host: how did you meet steve ford's? >> guest: i met him at an event when i was working at the university of southern california. i move back to new york and started working out "forbes" in the pr department. >> host: so elizabeth ames khmer practical experience prior to working at "forbes," had even checked that into how capitalism will save us? >> guest: basically have learned a lot since ford's. i've learned a lot about markets and again i began as a journalist many years ago as a journalist. so it's a notch printer, i learned about the this you need to have economic freedom to create jobs and is something i learned