technological transformation that is out of fashion. some day they will be a lunar colony hopefully called newt gingrich. >> jon: that is a wrap this week. i'm jon scott. see you next week. >> john: what if someone wanted america to fail. >> the man behind this video joins us. >> countless regulations that would be so complicated that only lawyers and lobbyists can understand them. >> that is what we have today. do we need all the laws, so many that no one understands them? the government can't could you count them all. no. >> is this regulation that is killing job creation. >> job losses are adding up big time. >> practically the worst economy in the worst economy in america's history. >> you find many fail.

to bully americans out of their dreams. >> john: they have done that. now the feds demand that every store must admit, now hotels must spend millions on devices that may never be used. >> they are scrambling to comply. >> do you know you could be fined thousands of dollars if you sell one of these things? regulated to death. that is our show tonight. >> john: americans want us to protect us, protect us from foreign enemies and people that might hurt us, physically or financially. so politicians pass laws that claim to do that. and then because they can't keep up with the constant changes in life they create whole agencies

to write and enforce additional regulations. this is the result. 160,000 pages of rules, some contradict each other. no one understands all of them and yet bureaucracy add more. thousands of new pages every month. regulations might be worth it if they make us safer but they don't. cliff assets has growing to a fund of $50 billion. so i assume you are smart but explain, you say the financial regulations meant to protect the poor investors that got hurt after the bubble burst do more harm than good? >> well, first, let's step back. i don't think zero regulation world is right. >> john: we all agree the constitution is good, you can't

kill or rob. >> they recognize the need for some regulations, some things like tragedy of the common flee rider problems do call for some regulation. the problem is when you take a progressive poll figures and teach them these words, they see external things everywhere. a lot of it has to do with their own incentives. you don't get more famous, actually everything is fine. you get more famous by passing bill with your name on it. >> john: let's back up. you are talking about externals things. >> pollution, my factory pollutes your lungs. >> john: many states it's reasonable against that? >> to some degree. depending on the situation. i have simpler example, speed limits. you might think libertarian

would be against speed limits. i am a libertarian, are you. >> john: yes. >> you might think they would be against speed limits but when you drive too fast and too fast can be argue aable you impose a cost of safety on other people. libertarians would be far less for or even against seat belt laws or helmet laws because though are imposed upon people. some regulations are needed but when politicians are given an open checkbook and the incentive to get famous and even wanting to do good it gets insane very rapidly and doesn't make us safer. >> john: financial regulations, first enron, they say we are going to fast this, they fast page after page of rules.

president bush says this is going to fix everything. it didn't stop bernie madoff. now dodd-frank. >> there are things that is not going to fix. intentional fraud is very hard to catch. yet we hold out the dream. let me give you dodd frank trying to regulate us to safety makes us less safe. bernie madoff was registered with sec. part of the reforms is to make that large number of money managers register with the sec. they are trying to find fraud. they are competent people but intentional fraud is very difficult to find. these are smart people trying to fool them and it's difficult to check every company. when you go out there and say everyone is registered, the small guy naturally assumes i'm safe.

>> john: i'm protected. >> exactly. so it's a tremendous burden but not always often they actually do the precise opposite. dodd-frank does it all over the place. dodd frank claims to big to fail the idea we'll bail out companies that are important to the economy. and i have yet to find where they end it. they substantiate forever. they say some institutions are very important and they promise they won't fail. that is bad in two ways. classic way they gamble with people's money but imagine they do fail? imaginable the unthinkable happens? how much worse would it be than it is to have a company failed that government said we got you back. it's incredibly worse to have a company fail where we were told

it's all going to be okay. government has it covered. so very often in trying to stop these things they induce a lot more risk into the system. regulations, it makes us inefficient but it often gets it backward. >> john: one thing of regulators is the group can spot the next bubble and pull the plug before it happens. >> if they could, they should be doing my job. we try to make money by pricing things a little better but i have a lot of trump eight bureaucracy are going to predict the next bubble. predicting has a cost when you wrong because you cut off cost and innovation. it's a bubble we need to stop you stop the economy from growing. stow the idea, alan greenspan tried it. remember in 1996, he called it three years before the tech bubble.

he eventually changed his mind at the exact moment by the end of the tech bubble. i would certainly bet on him ahead on the rest of him and i wouldn't bet a nickel on him getting it right the next time. >> john: so the market sorts it out? >> first the market does sort it out. markets are not perfect. they make errors. they are far better than committees of bureaucracy. second i think if government stopped monkeying with markets we would have lot fewer problems. >> john: this week i went on a book tour, "no, they can't," 31 things in 20 days. that was nasty. i was struck by the people that came to the events and people wanted to have their pictures taken with my sign which i carried around the country were entrepreneurs. they tried to start businesses

and were infuriated by their experience with regulators, regulators that say, yes, we can make life better. i say no, they can't. to most americans, regulations are abstract ideas, but if you have the guts to invent something and hire people that is when you discover these regulations are big threats. mike what len runs a dozen hotels in the midwest. a new swimming pool regulations current threat? >> amazing. they started in 1993 looking at what rules they could do to have the disabled access to pools. in 2010 they came out with new pools. using portable lifts until january 31, the department of justice announces that not only do portable lifts do not work but permanently installed electrically operated self-operated lifts that each body of water, swimming pool.

each spa had to be installed by march 15th. >> john: bolts into the pool. >> specially grounded. most people know that electricity and water don't match. you have to have one for the pool and spa. there is somewhere between 105 and 120,000 pools and spas in hotels. probable another 150,000 in other public pools. so the current manufacturers make somewhere they guess a around 50,000 lifts a year. so we're saying in the next 40 days you were supposed to have these things installed even though you may not be able to buy it for four or five years. >> john: you inquire what happens if we can't get one? >> the department of justice just looked at it and gave them the bureaucratic blind fair.

>> john: they don't call us back. they refer to us officials of the department of justice. regulators did issue a statement struggling to enter a swimming pool negatively obstructs a person's independence. >> you can't even buy the equipment. >> john: and you have a portable pool lift. a disabled person, a person in a wheelchair, i am going to need help getting in the pool. i don't want somebody carrying in. i would rather have a machine, you have one. >> we did a survey of all the hotels, word came back. we have never, ever used pool lift. longest person had been 13-14 years. >> john: in 15 years royal apartments in phoenix, nobody

has ever used the portable lift. >> we don't have one, mike. they called me back and said, mike, i found it. my maintenance told me we have one. so sitting there they are not being used now. why would you want to have $10,000. you are talking billions of dollars for something that really hasn't been demonstrated you need it. >> john: you are evil, you are evil, too, and you are rich capitalist and you don't want to help disabled people. >> let me state for the record, i would like the handicapped to lead better lives but this is not the way to do it. government does it all the time. they hide a cost of big government in terms of regulation. which, of course, is all of us, it's not that different in taxes, but i'm not saying it would be ridiculous to require lifts but honest way for them.

we're going to tax everyone more and government is going to pay for lifts everywhere. that is not my idea of a good idea but it would be honest and straight forward. it's the same thing. when they impose the costs on mike, it's partially borne by him but borne by all his customers. they have hidden the costs. >> john: and $55,000 fine if you are not compliant. >> and you are subject to drive-by lawsuits for private individuals, you can't get civil damages under law but you can get attorneys' fees. we live in a land of perpetual outlaws. you look at the pile of regulations, no matter how good your heart is, you probably always somewhere violating some statute. >> john: thank you mike and cliff. coming up, did you know you could be put out of business for selling this, this toy gun?

also we meet the guy who made this video which has gotten 2 million hits on youtube. >> i would make countless regulations. [ gans ] [ marge ] psst. constipated? phillipscaplets use magnesiu an ingredient that rks more naturally with your colon than stulant laxatives, phillipscaplets use magnesiu for effective relie of constation without cramps. thanks. good morning, students. today we're gonna continue...

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>> john: in a low income section from brooklyn an immigrant started this 99 cent store. he has barely made money but

survived. he employed dozens of people until now. now his store is about to be put out of business because it had the nerve to sell these. a kids halloween costume that includes a plastic gun, a toy gun. this is likely to put them out of business. the new york says the gun might be mistaken for a real gun. and they hit them with a $5,000 fine. you are a lawyer in a neighborhood. he comes to you for help. >> yes, he came for help. he received a summons. he had six of these toy guns, there was a $5,000 fine for each gun, so its $30,000 fine. >> you bargained it down to $5,000. >> we received a settlement offer for $5,000. i don't know how many 99 cent items you need to make $5,000.

my client did not believe he could pay the $5,000 fine. so he went to trial. we produced our evidence. we produced the toy gun that is clearly fake. it has an orange cap and small size, it comes to 99 cents with a gun, handcuff and badge. it does not look real, it looks like a toy. after hearing the evidence the hearing examiner imposed a $30,000 fine. we appealed the $30,000 fine and after the appeal they reimposed a $30,000 fine. it's only amount of time that city comes shuts the doors and puts all the employees on the street. >> john: and the city says, when they are asked about this, realistic imitation guns are illegal and dangerous. a 15-year-old in texas was killed while holding one of these.

>> my understanding is he refused several lawful orders to drop the gun. in this case the toy gun is clearly a toy. i don't believe under any circumstance where a police officer would view this as a fake toy gun. i believe we substantially complied with the law other than the gun is not an acceptable color of pink oriole. >> john: i think that is why you lost. the colors include white, bright orange, bright green. >> i have represented 99 cent owners for many years now. my clients have been accused of selling cigarettes to minors and alcohol to minors which are serious offenses and the fine for selling cigarettes and alcohol pale in comparison to the $30,000. >> john: do you they think they don't care about businesses.

they have some kind of indifference? >> i think they believe there is magic pot out there. he can dip in to and raise his prices. he can pass the prices on to the customer and pay the money to stay in business. i don't believe my client has the funds or magic pot to pay a $30,000 to sell 99 cent items. >> john: wouldn't be nice to all of magic pots. coming up. store owners are being sued because they didn't want little horses in their stores. truth in government says you must allow them in. what's the matter?

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>>. >> john: with a 160,000 pages of

federal rules facing us, even liberal politicians occasionally talk about reducing regulations. >> that is why we're getting rid of regulations that don't work. >> john: but they barely eliminated anything. some of the regulators step on people. i recently reported on this family. they got a legal permit to build a house but bankrupted by epa bureaucracy who made up their own rules. we got a taste of that mentality when this epa official was caught about his enforcement strategy. he compared it to the romans conquering villages. you crucify the first five guys i find, then that town is easy to manage. is this bureaucracy' attitudes? one person that should know is used to head the cbo office.

do you go loose, is this their attitude? >> obviously in some cases it is. we saw that epa official actually step down from his position because of the backlash against the strategy that was clearly one meant to intimidate and not to serve the public good. there are times when it goes out over the line. there are times when the regulations don't make any sense. i was listening to your show earlier and one of guests made the point this is just like tax and spend but only in disguise. in this environment where we have huge budget deficits go, the risks of trying to do it in disguise gets bigger and bigger. >> john: we have new, weird regulations that your regulation rodeo is looking at. justice department that miniature horses must be allowed in stores, they can't toilet train them and you could be in trouble? >> hard to believe.

saddle up. classic case of a well-intentioned regulation. you want to make sure the disabled have access to the same places for the rest of us but what is next. if it's miniature horses, what are we going to have them pulling next. this is extremely difficult place to put a store owner. it tramples to run their businesses they see fit. this is question whether one regulation is going spawn million more. how do you know they are qualified? do they have to wear a sign or have a bar code. how does it end? the regulation is going to multiply and explode. >> john: another one in florida, i saw a picture of a vending machine that had this odd sign on it. what is that about? >> this is my favorite. next to the vending machine you have sign, telephone by law this vending machine have the sign.

please call this number which raises the question if the sign is not there. it's highly productive regulation doing what exactly, i have no idea. >> john: the sign has no purpose other than you have to have that sign in florida. i thought they would be embarrassed and say it's a mistake. >> they should be embarrassed. companies that provide vending machines are typically small business. new health care law gives them labeling regulations, this is what is in this food. i know what i'm getting when i go to a vending machine. >> john: president said encouraging things in his state of the union messages. he said we got rid of one rule that classified a spill of milk like an oil spill required a hazmat team to clean it up. they got rid of it.

but that rule was in existence for 40 years. other one he cited, 12 agencies deal with exports. the interior department is in charge of salmon in fresh water. commerce department in salt water. it gets complicated once they are smoked. everybody laughs and there is applause but they haven't gotten rid of that craziness? >> they never go away. even if they do and congratulations that our dairy farmers, they don't have to wear hazmat suits to clean up. but the net burden is rising and not falling. some of the new ones will make as little sense as the old ones. there is one as usual the energy and clean energy. with a new kind of ethanol and couple years back, everybody was hot on it. we mandated its use. the trouble is it doesn't exist. that is regulation that should

go away. maybe the president can work on that one. >> john: thank you douglas. watching regulators what they do do they want america to fail. a video that asks that question. >> if i wanted america to fail.... [ male announcer ] the inspiring story of how a shipping giant can befriend a forest may seem like the stuff of fairy tales.

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>>. >> john: people wanted government to keep us safe and keep us from being cheated so politicians and bureaucracy keep passing and adding more rules. here they are. that is how many the feds alone have passed. they add a thousand pages every week. i say it doesn't help us, it enriches lawyers and bureaucracy it makes us poorer and less free. one of few politicians in the senate who understands that is utah senator mike lee. i'm glad you are there with them and i'm glad you understood it. your father used to talk about the constitution at breakfast table? >> yes, we talked about it a lot. >> john: what is going on. how do you see this happening. how do you see it ever being solved? >> it's easily for elected

politicians and speak in terms that sound perfectly unobjectionable. let's have clean air. >> john: i'm for clean air? >> who isn't. but we out source defining what clean air means. those people who make those rules which are as you pointed out laws, those people are unelected and they don't work for anyone that elected and that is a problem. >> john: you wrote a book. you talk about the federal regulatory monster? >> our laws are not being passed or put in place by people who are elects. this is income patable with article one section one and seven of the constitution which went out of their way anyone making laws have to be passed by people in congress that are elected in every two years and every six years in the case of senate. >> john: and let's say, so what.

it's all stuff that is supposed to make life better? >> it's supposed to and we want to believe it will. we want there to be clean air and pursue the lofty goals passed by congress. one of the problems we have is when you insulated those that write the laws and also the same people enforcing them. the people affected by them and from the voters, they don't look at the fact they aren't accomplishing what they are supposed to accomplish. sometimes they are having exactly the opposite effect. they are making us all of us poorer. >> john: intuition tells us passing laws is a good thing. kids who tour the state capitals they don't come up to and say, what a laws did you repeal. what have you you gotten past. that is being a good citizen? >> politicians tend to be given

most accolades when they fund programs or pass laws. that is when we get praised the most. individuals regulate themselves much better than government can in most areas. >> john: i wrote a book, "no, they can't," which argues that it's intuitive to think that government has to do these things. that without these new rules life would be ugly the poor would suffer. >> i've read your book. >> john: good. i like it when senators read it. >> i love it. it sends a message that people need to read. it's absolutely correct that intuitively we want to believe those things. >> john: as you point out in the book, sometimes our intuition is wrong. >> this is sometimes where human intuition is wrong, perhaps it's primal or cultural, let's have some of these important

decisions made village wise. but village wide is very difficult than nationwide. especially a nation of 300 million people like ours. >> john: it's so odd to hear a senator say it's great. you went to law school and i assume they teach all lawyers that life can be managed through paper and procedure top down. >> the law itself lends itself to that kind of thinking. it's not altogether wrong. there are after all some areas where it's totally appropriate for us to have this village elder deference on a national scale. for instance, national defense, when it's time to go to war, we have to rally behind a leader. regulating trade between the states and foreign nations, that has to be handle at the national level. >> john: why does it need regulation? >> it's the extent of the

regulation the s the critical question we have to answer. congress over the last 75 years with a little assistance from the supreme court has kind of seen that as a green light. >> john: in terms of the regulatory burden, a thousand pages a week added, you have a sunset proposal that would stop that. >> yes, the best proposal to deal with the mission creep associated with the modern federal regulatory state is a proposal called reins act? >> it's an orange co-sponsor in the senate. any time you have a new regulation carrying the force of applicable federal law, if it has an economic impact hundred million dollars annually,

relatively easy hurdle that regulation will be viewed as proposal and won't take effect until it has been passed into law by the senate and house of representatives and submitted to the president. we're requiring the congress to follow the same procedure to enact these into law such that no such regulation meeting these criteria without congress acting. that is what the founding fathers intended. >> john: senator lee, i hope you can get rid of some of these rules. that more on stupid government rules, next. [ male announcer ] if you think tylenol is the pain reliever orthopedic doctors recommend most for arthritis pain, think again. and take aleve. it's the one doctors recommend most for arthritis pain. two pills can last all day.

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>>. >> john: regulated to death! that is harsh, even i assume the

regulators don't want death, they don't want to kill prosperity but they do kill prosperity. here is part of a new web video that took a clear stand on that. >> if i wanted america to fail, i would do certain things. if i wanted america to fail i would never teach children the free market is the only force in human history. if i wanted america to fail, i would create countless new regulations and federal agents to raid guitar factories for the wood and make it easier to stop commerce to start it. if i wanted america to fail, i suppose i wouldn't change a thing. >> john: that video was made by free market america. as of this week it has been viewed about two million times

on youtube. the guy speaking is executive director of free market america, what is it? >> free market america is a group of true believers. we begin as a florida organization. >> john: is that what made you a free market believe? >> you know, partly, yes. we had a preview of occupy wall street movement and it's discretionary stuff. >> john: you think they resent success or do they want a safer and cleaner world? >> i they resent success. they are not interested in conservation so to speak. this the grandfather's environmental movement. these are micromanaging of everyone's life. we view it as a threat to liberty. the purpose of free market america is to make the pro freedom case on environmental extremism. >> john: so you and a couple other people, three writers,

sitting talking about it. you shoot this in seven days, you go on home on friday and it's been viewed 200 times? >> 265 times. we had no expectations it would be this big. it's been a source of a lot of optimism for me personally. i think history teaches never to bet against america. this we are a country that put a man on the moon. challenge of this generation is simply to wake up and remember why those things happen. they happen base of the essential ingredient liberty. we made the video that we knew to be true. >> john: are you suggesting that president obama wants america to fail? >> no, i'm not suggesting that. our point is a broader critique of the environmental movement.

since 1960. environmental regulations have increased by 7,000%. drained $281 billion. >> john: air and water is cleaner than they used to be? >> everyone wants that but they now cost the average small business owner more $4,000 per worker. we have gone past common sense and we are producing little environmental benefit but producing extraordinary costs. >> john: i would totally agree. you couldn't open the window in this town because soot would come in, but they fix that had after they got the air and water plenty clean. i can swim in the hudson river. the regulatory always wants more hence the pile of rules. >> the problems created by governments and they may not have the same solution. more government. we have an extremely aggressive epa that is using lawsuits to

drive regulations and a professional bureaucratic class that seems to unfurl regulations without any regard to cost and who is in the white house. >> john: one part of your video i would quibble with. >> if i wanted america to fail i would empower unaccountable burr okay crass to bully americans of their dreams. >> john: now i quibble with the word, unaccountable same complaints are made about obamacare, unelected bureaucrats will decide who gets one medicine. electing them wouldn't make it better. i think we should just say bureaucracy or politicians? >> i think both of them are a problem. you have a problem with unaccountable bureaucracy, a professional class that is long sense moved beyond common sense. on top of that you got the fact they are seated that distant

capital. >> john: one part of the video i think a lot of americans would argue about is this one. >> if i wanted america to fail i would convince americans that america has it wrong. >> john: i think a lot of americans europe has it right. its kind country. it's environmentally clean. they help poor people. it's $8 per gallon of gas in france. in the united states we have a get up and go culture. my ability to get my car and drive and visit someone a family member a colleague on the other side of the country is important to me. it's an essential ingredient of freedom. the other thing we're is the regular louisianaer to climate in europe is far west. they have less job growth. >> john: one last point. take us back to that moment when you were home for the weekend and you checked the youtube

score? >> it was incredible. we were blown away. when i left was 265 views, by saturday it was few thousand, by sunday it had exploded and we had hundreds of thousands. you are talking to a guy a couple hundred people would watch the video. >> john: thank you ryan. >> next my take on the regulators. do they really want america to fail?

>>. >> john: that popular web video we showed parts of suggest that some regulators want america to fail. now, i don't believe that. except, maybe some do, after all

the environmental group earth first used to use the slogan back to the pleissene and they believe only pure nature is normal. some won't be happy until they reduce our carbon foots print to zero. think about who becomes a government regulatory. who wants to create these rules. do you want to work at the epa? i don't either. i don't want to work in a dreary burr okay krags. who is more likely to be a bureaucrat. environmental zeal otds. >> if i wanted america to fail.... >> some people in our government still want the price of energy to rise. they will achieve their vision, americans will have to live in

small homes or apartments, great they say. once you decide that industry is destruct identify. higher energy costs will do that. but if they wanted to make america poorer, just say so. something like in the name of our pristine environment we will live in caves and freeze in the dark. not a catchy slogan but peeling a i peeling to some environmentalists. there is one part of the video i really liked. >> if i wanted america to fail for every concern, for every crisis i, like shutting down entire industries and killing tens of thousands of jobs for saving spotted owls. >> john: but the regulators constantly create crisis, overhead power lines will give

you cancer, so will ddt, breast plants, nutri sweet and all those is media scares i was asked to cover during abc career. and lawn chemicals and all its crisis and all that is required giving more money and more power to government. the so spotted owl story hits home to me because my first tv job was in oregon. i know some of the loggers that lost their job because the owl had to be protected. this year, the ap reports despite all the logging restrictions, despite the 30,000 jobs lost, the number of spotted owls continued to fall. now, they say obama administration plans to shoot barrel owls, rival birds that crowd out the spot owl and what about 30,000 humans that lost their jobs? no, not much.

not to the regulators who are always protecting us from crisis. crisis that they inconvenient. they may indeed, in vent. that is our show. thanks for watching. take it with food. switch to citracal maximum plus d. it's the only calcium supplement that can be taken with or without food. that's why my doctor recommends citracal maximum. it's all about absorption. a body at rest tends to stay at rest... while a body in motion tends to stay in motion. staying active can actually se arthritis symptoms. but if you have arthritis, staying active can be difficult. prescription celebrex can help relieve arthritis pain

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