sydney. john: washington is a swamp because insiders use their clout to rig the system. >> i need a bailout. john: those who want to compete with the actual entrepreneur said they get politicians to ban competition. but even entrepreneurs get handouts. $500 million from the government from tesla and 500 million for spacex. fortunately there are people

fighting against the cronies. >> drain the swamp. john: will present a swamp drained the swamp and fight the cronies? that's our show, tonight. >> and now, john stossel. john: when donald trump talks about the swamp of washington is talking about self-dealing between washington insiders and the politically connected. that comes in many forms. the optic high wall street movement was angry because as they see it wa enables corporate greed. [chanting] corporate greed has got to go. john: corporate welfare, that's a different point those protesters have a lot of silly ideas but they are right to

complain about welfare for corporations. after the housing bubble bursts, banks got real doubts with your money. they paid it back but it might not have been paid back and it might not be next time. when big business goes to washington to partner with politicians it really means they seek privilege is from government. subsidies and rules that make it tougher for competitors -- competitors. the result? >> americans understand the bailouts are bad. they want the swamp drained but if you understand much of government that they like ads to the problem. this picture of an iceberg explains it pretty well. bailouts are visible but just as damaging our regulations, subsidies, the expectation of bailouts, loan guarantees, protectionism. preconism, donald trump is

going to add to that. all of these things are part of the washington swamp that strangles real entrepreneurs. jeff deist says few people understand how bank regulation helps big thanks at the expense of little people. they think it's punishing the big banks and the banks whine about it. >> appointive dodd-frank was to take this contagion and big banks and say let's have a process to break them up if this ever happens again so we don't have to worry about another bank failure. john: that they have gotten bigger since. they haven't broken anybody up. >> we have now the system were too big to fail has gotten edgar and smaller banks that say under a billion dollars capitalization are disappearing at a rate of one or war just since 2008. there has been no new small banks in the country. john: explain that. the idea dodd-frank is to protect us but the best protection is diversification and a diverse economy.

lots of small banks making their own decisions. you would think dodd-frank would watch for the big tanks. why did he kill off small banks? >> is the same regulations across-the-board in banks of all sizes. john: your bank says we can afford to figure this out. >> absolutely one or two compliance officers can be the difference between profitability. john: a much more clear example is something called the export-import bank. >> the government take some of your dollars and most of the companies and government in other countries. it's called the export-import bank. it's a great way for washington to give out favors to companies. good old cronyism. john: a few companies is right. most of the money goes to just a few big companies boeing caterpilin ge. some principled republicans move to kill this and almost did.

>> they almost did. spin table. it's probably going to be rather rise. john: they can kill anything? >> here's the thing why should taxpayers be on the hook to help the state-owned airline in ethiopia by airplanes from boeing. who decides whether boeing gets a subsidy and who decides whether ge or caterpillar who decides whether ford or chevy could get a? it politicizes the economy and that's a dangerous. john: i ask you on social media what is the worst crania -- cronies and you have. sean says the pharmaceutical industry. price-gouging so nobody can enter and compete. he is right. >> it not that nobody can compete. it's the fda has total power over which products will not be allowed and to get a new drug or device takes 10 years, billion dollars. that limits competition to the few. recently people got mad because the cost of epinephrine pence have increased from $100 to $600

each. >> that's because of the psyche price of epi-pens. >> a dramatic price increase for a lifesaving medication. john: why would a company get away with charging so much more so suddenly? >> because it has no real compition. other epinephrine pence were rejected. competitors want to come out with a similar product to invest money for this huge amount of uncertainty whether they will pass inspection and whether they will potentially infringe on my lan's patent so there's a double whammy of overcome the patent system and i would call that cronyism, government decided to winds and loses in an industry. john: and it's an invitation for sleazy dealings for the company instead of focusing on making a superior product to focus on making friends in washington and we will never know what happened with the epi-pen and why the competitors were pushed out but it's interesting that the ceo of the company who paid herself

$19 million is the daughter of a u.s. senator. >> it is interesting that this is a moment where you have both trump people and sanders people starting to come together on these arrangements and there's a lot of anti-f. d a. sentiment not there on the left and right. john: nobody wants to get rid of the fda. they are just saying what more competition happen. >> job i don't want to get rid of the fda. john: none of these politicians are willing to go that far. >> we have have to understand as one grows the other gross and to be clear to the audience we are saying let's get rid of the fta we are not saying let all kinds of perks poison you. we are saying market business would do it better like underwriters laboratory or consumer reports. i wouldn't take a pill unless it's gotten approval from one of those organizations. >> marketplaces the rail regulator including what should

have been allowed to happen with the bankruptcy and liquidation process. john: let them go bankrupt in the banks have made smart ones would do well and the idiots who got bailed out would be even bigger today. >> that's the difference between free-market capitalism. please stay listeners upside for the parties involved and no downside in real capitalism there spoke. john: thank you jeff deist. it's probably misleading to call washington is swamp because well most of it doesn't look like one. >> you can really see when you get to the top. john: are lots of expensive homes here. >> a beautiful gourmet kitchen, a culinary delight. john: skylit. today for the first time most of the richest counties in america surround washington d.c..

two people know more about how they got rich than peter schweitzer the author of printing cache the book that exposed many of the clinton foundation sleazy dealings. so i feel sorry for you. your book was going to be big for four years and now she is not elected. nobody cares anymore. >> people care. washington d.c. is a target rich environment as far as exposing cronyism and corruption. never-ending source unfortunately of those kinds of stories in that kind of information. john: than let's show some more pictures that show how much money as is sloshing around the washington swamp. washington, once a sleepy part-time home for politicians now resembles versailles. powerbrokers work in buildings that look like palaces and after work they go home to castles. >> it all helps one understand why people spend millions to win

jobs here and then. >> once people come to d.c. they never leave. johnthat was the realtor selling houses and why should they leave when they can make so much money off of us? peter, it didn't used to be this way when washington was smaller. >> washington d.c. has changed. it's become a place of wealth creation off of government. it's not producing a whole lot but you also see a lot of corporations and companies now john that are locating there because they see the advantage of being close to the seat of power and getting favors from the federal government. it's a very rich city and now it's the wealthiest city in the united states which to me is very troubling. john: president-elect trump says he will not allow his staff or lobby for five years after they leave the executive branch and he will propose up to a five-year ban on lobbying former members of congress and their staff. >> i think it's a great start. his pledge to drain the swamp to

the problem is, it's a pledge. they are basically making a promise in washington d.c. unfortunately a lot of promises get broken all the time so it has at this point no force of law. john: after writing clinton cashier came up with your own reform plan and i will rather quickly. one, lifetime bans on lobbying for members of congress and their families. bank robbers and from taking any donations from defense contractors and lobbying firms. three, no campaign contributions while congress is in session. this sounds good but i'm skeptical and i wonder how fair is that because as government has grown and grown more evil in many ways you are right to talk back if you are company and say please don't put us out of business. this law will kill us. it kind of depends on having access to congress. >> e i mean look the ultimate

solution of cronyism is to shrink the size and scope of government but hopefully that will happen someday. i don't think it's going to happen anytime soon. if you talk to most corporations , not all but most corporations in silicon valley and elsewhere they would rather not have to hire lobbyists. they would rather not have to make campaign contributions. they feel like they need to any sense because because it's more like extortion then it is rivalry. politicians are creating a demand for their services by creating laws or circumstances that in a sense force corporations to make campaign contributions and hire lobbyists. my reform is not a silver bullet in and it doesn't fix everything but i think it would disrupt this influence marker place in washington d.c. and change the dynamics in a positive way. john: i suspect one government is that big people would ban family members. people would get divorced just so they could go back to lobbying.

you pointed out something called tax extenders and a good example of how the system works. >> a great example is the tax deduction or tax credit the corporations get for investing in research and development. this is a good thing and encourage his innatio by american corporations. it's been on the books since the reagan administration that he gets react to every couple of years. why is it not permanent? why is congress not making a permanent? if they made a permanent they would not have a reason to get major corporations to give the money every time it's up for renewal so it's kind of a hostage situation. we are going to stand up for a couple of years for two years and now we are going to come back to you asking for donations so we will pass this again for another two years and we can redo it all again. that's the kind of craziness you get with this kind of business model of crony capitalism by politicians. john: some people pour more money into this one. thank you peter schweitzer.

coming up for the green creature better known as elon musk. why is he a rock star savior? he. >> is the crony capitalists who pays up democrats. next, the military swamp. what does a fighter plane c >> they don't come cheap. the helmets alone cost hundreds of thousands of dollars each. if you take medication, you may sometimes suffer from a dry mouth. that's why there's biotene. and biotene also comes in a handy spray. so you can moisturize your mouth anytime, anywhere. biotene, for people who suffer from dry mouth symptoms.

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comcast business. built for security. built for business. >> guard against the acquisition of unwarranted influence whether sought or unsought by the military industrial complex. john: the military industrial complex. eisenhower said this 50 years ago. it's much bigger now. defense spending is a massive swamp of wasting cronyism because the bureaucracy paid in there just a few suppliers. 20 years ago the defense department agreed to by 2000 new fighter planes from lockheed-martin called f-35's. >> muster heading to the airport and they don't come cheap to the helmets alone cost hundreds of thousands of dollars each. the pentagon says the f-35 is a top dod priority. john: that's fox's lea gabrielle

she knows a lot about fighter planes began she is to fly them in the navy. when you were a pilot you saw plenty of ways. >> at the end of each fiscal yearhey send us all out to fly for example virginia beach to pick up lobsters and fly home. i flew to san francisco and back in the reason they do this is because if we didn't burn our gas the money we were given for gas for that year we wouldn't get as much the next year and that comes down to congress. that's because of the act. john: use it or lose it. >> there's no incentive to save that money for something different or give it back to the government. we have to use it or read to lose it. john: let's return to that fighter plane. congress first ordered years ago. >> the development of stretch to 15 years at costs of more than doubled from original estimates. john: despite the double cost the f-35 still has lots of problems.

>> they have problems with maintenance diagnostic software sensor fusion shortfalls fuel system problems. john mackey goes on and on but he still wants the plane as do you. >> yes. the talk about john mccain for a minute. he spent five years in a p.o.w. camp because he got shot down by a surface to air missile. this is a man understands why we need the pilots have the best technology possible. we send our sons and daughters and the combating wants to make sure we have the first look and to get the first look to get the first kill. as with the f-35 does. the visionary airplane of the future that basically takes sensors and puts the entire picture together and are helmets. john: its waiver budget and has all these problems maintenance diagnostic software. do you assume this will get solved if they spend enough money? >> it was this big. my computer was this big and now my computer is like an iphone.

john: this plane keeps getting more expensive. >> technology is changing we have to continue to work with what we developed to make this the best aircraft that's ever been belt. it's visionary and people equate having internet in the sky that bringthe battle space into one picture wherever one can share it but it does cost money. we have to have equipment that's going to give our fighter pilots and our soldiers in air men and sailors the absolute stecality. john: what makes you think the bureaucracy is going to get there? >> i agree the military has to be better about how they spend in their ways to do that. kimmie teacher contractors to negotiate better? yes. can we teach the managers of these programs to manage better? yes but we need to put more pressure on congress to do a better job of appropriating money and writing laws that actually incentivize. john: people it said this for years and never happens and not trump wants to spend much more on the military.

>> i don't think you can equate spending more on the military with more waste because we are becoming a more complex and dangerous world. john: what about when congress buys things for the military that the military doesn't want? this happened with the abrams tank. >> congressmen and women want to keep the jobs in their districts and keep the money going into the local economy. they want to be reelected. john: the army says we do want this tank so you are going to have it anyway because it's built in ohio. >> we will give me the f-18 and it comes down to the parts. john: thank you. cong up people to fight the crony's biggest they're angry about what cronyism does. >> it's criminal to make them pay more for food. john: up next the cronies attack great innovation. >> they think they know how to

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>> this is the government thinking that they know how to run a ridesharing business better than the two most successful ridesharing businesses in the world. john: she said she's a dissenting politician austin texas where bureaucrats ran ridesharing companies out of town. my mayor in new york city tried but failed. >> what we have agreed to is the limit we needed so we could make sense of a complicated situation. john: such a weasley hustler. politicians routinely don't like new ideas and they really don't like new ideas that compete with people who give them money. in this case the regulated taxi business. uber is largely one but it's an

ongoing battle. author of uber posits a consumer's benefit is the politicians move in new companies when an and that's jared meyer. but the politicians are supposed to be there for the public interest. they are supposed to but when you have their private interest in the case of maher de blasio getting half a million dollars from the tax industry and they stand up at a news conference and say this about ube >> they are lookinut for their corporate bottom line. they're putting their profits overall the considerations. john: yeah that's what businesses tend to do and says they can can't make a profit unless they serve their customers well pursuing profit is better consumer protection than the mayor will ever be. >> uber was clever about fighting the mayor. if you clicked de blasio option you were told you might have to wait forever for a card.

lots of uber customers complained and the mayor caved in. fossa politicians have tried to kill a uber but most fail. one big city however did force a uber out, austin texas even after the police chief testified what her people. >> the worst that could happen would be to lose 10,000 options for our citizens. [applause] john: they applaud that they lost and uber and austin band uber so what's happening in austin? >> it's chaos especially after football games. the city is and what you're seeing is austin put the cap on the number of cabs the conservative city. austin is only 900 and the city that has most bars per-capita downtown, you are not trying to get 900 the road to get home all the drunk partiers every night.

that's not going to work and it's sadly going to lead to real consequences for people driving under the influence and unfortunately dying from this decision. john: it's not like these don't exist. there are all these new businesses ride off's's and instaride get me ride get me aunt they have facebook ridesharing group with 8000 people. >> i was just down in austin and i had to take a taxi because i could not find a single ridesharing app that would work. it's a nonprofit. take away the profit motive and try do a charity in the customer service starts to suffer. we need uber and lyft to be operating or other private companies that care about making a profit. more portable rides more transportation more dynamic for higher vehicle market.