understand the concept. let me bring in an economist from stanford, university. why not worry about them sending work to other countries. >> the fundamental thing about trade it makes everybody better off. trade benefits allow others to benefit in trade. >> the uniforms could have been made by american workers. >> not the cost that makes sense. the problem with the united states we are so much better at so many different things quite honestly making garments is no longer the comparative advantage. >> i wouldn't call that a problem i would call it an advantage. those jobs being a seamstress are factory jobs that are not so pleasant. now even though those clothes aren't made in america. they are designed they are marketed, they are told here, they are shipped in trucks made in america. they are built on machines made by americans and all of the chinese workers made those

garments the chinese olympic team will fly mo london on american made plains and designed planes and they will be wearing u.s. defined footwear and this makes us all richer. >> yeah, it absolutely does. people don't get that. people don't. one can argue the american uniforms were not manufactured in china they were grown in a soybean field in china. something we export is soybean because we are productive in soybean. we get more uniforms at lower prices the chinese get soybeans they get higher wages we get lower prices everybody wins. >> if we insisted everything be made in america all of the olympic clothing we would be poor. >> couple other myths, over population. i was told that's why asia is poor that's why africa is poor. big problem. >> yes. the problem is there are not too many people. they don't have free governments

they have bad governments who take their services. one thing that opened my brain about it was to look at some of the population data. i heard nigeria is poor because of over population. pakistan is poor because of over population. they have 174 people per swear mile 225 people per square mile. that's half of what the netherlands have and holland is rich. it is one-tenth what hong song and singapore have. >> one thing that's interesting more people closer together leads to over population. >> over population is not a problem. >> i am told we are running out of school. i am told we are running out of fear. jimmy carter said we are now running out of gas and oil if we

are running out of oil that implies the crisis shou-- price should be rising over the long run. oil is getting cheaper and cheaper and cheaper and cheaper. even as they get more expensive we run out of them. >> they keep inventing new ways to suck more oil out of the same wells find more oil, dig deeper. we have storage of more oil and gas now than we did when president carter was saying we are coming out years ago. let's go on to myth 4 about your personal choices. all is confidential it gives contrary advice like you should unschool your kids. it is written by an entrepreneur. he made millions selling a book to companies.

what do you mean unschool your kids? >> obvious kuur kids are taught the bathroom walk all by themselves. what do they remember from school? i will educate my kids better than the government at this point. >> most people don't want to. most people don't want to home school their kids or form their own school we trust the experts. >> the experts are getting funding based on the lowest common denominator. they teach them to fill in the circle test. there's no other learning. you listen to the most boring teachers of all. what did you learn in school? what do remember? when was charla main born? i know that's a fact i learned in school. >> so pull them out of school and get together with the neighbors and invent something? >> no. give them opportunity to learn. have books available have them play sports. no one wants to sit and listen

to someone for 6 hours. i am willing to pay my kids a dollar per page. i am willing to pay them write reviews for books. i will set up social play dates with kids being home schooled or unschooled. >> we are told you have to go to college. especially to get a job. >> which is a myth. we know this is a scam perpetuateed by only by the banks or government. >> student and the college. >> tuition has gone up 1,000 percent inflation up 300 percent. why has tuition gone up 100 percent. is it that valuable to earn a college degree. >> image if you had a 5 year head start and no student loan debt and you had the same ambition. i am sure you would do better 20-years later. >> another one we are told everybody should vote. you need to vote. >> we all live in new york state. what good is our vote here.

>> you may not. most of you live in a state where this is true. >> there are four or five battle ground states where your votes have some sway on the governor level and presidential level and so on. >> if you live in michigan michigan, ohio, nevada it could be a one-vote election. think about that. finally you both say don't be so scared? >> look at the news today. the news every day worries about europe, worries about greece. the reality is things are going pretty well. eat c the economy is actually growing. you would think we were in a horrible recession but we are not. you would think we have a biological need to be scared of things. the people didn't get trampled by the el vant. we are always looking out for the predators. reality is people get good once in a while but all of the headlines would suggest they are

bad. >> i am a consumer reporter. swine flu, global warming, madd cow disease. where are the birds. >> it might have killed us. might have gotten brain cancer from your cell phone. >> maybe we are in hell right now. >> you say it could happen as one of the most dangerous phrases in the english language. >> yes. people systematically miss estimate risk. people try threat of terrorism if you are genuinely worried about that you would never get in a car again. the risk of driving for example is so, so, so much more greater -- so much greater than the risk of dying in a terrorist attack or something like that. >> even a risk of being kill bide a beedeer. >> dying of a peanut allergy or something like that. >> terrorism is a bigger deal.

it killed 3,000 people here. >> cost us $10 trillion in wars and made the rest of the world hate us and increased the odds in some cases of terrorism or other unbalance happening in the middle east. >> on that note food for thought you can take it or leave it. thank you, art and james. what we think we know often is not so. i agree with most of what they say. coming up, to make a point about this i will stick my hand in flames. next how the epa which is supposed to froekt us actually kills people. clee e seafood feast choose your soup salad entrée pls dessert! all just $14.99. come into red lobster and sea food differentl visit redlobster.com now for an exclusive $10 coupon. good through august 5th with tums freshers! concentrated relief that goes to work in seconds

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>> thank goos for >> thank goodness for government. not something i say often. but there are some things i want my government to do including things not listed in here in the constitution. something the founders never thought about. pollution control.

my beloved free market isn't so great handling that one. one factory smoke goes to other people's lungs. what does the factory care? some libertarians argue we could sue the polluters. our legal system is so gummed up that really wouldn't work and take forever, cost a fortune mostly enrich the lawyers. that's why i would say thank goodness for the epa, the environmental protection agency. they made the air cleaner than it used to be. when i was a kid in this town you couldn't open windows, the suit would come in. water ol pougs rules thank goodness. the water outside of the studio was once disgusting now that's not true. within a short distance of millions of people flushing, i am willing to do this. i lived to tell about it. the hudson is totally swimable

now. so it's great that government has cleaned up the air in the water. but how did they accomplish that? did they say we have done most of the good we do and shrink? no, government never does that. they always want to do more. that upsets one medical doctor. he says the epa now kills people. what do you mean killing people? >> i came out with a report because i am a member of the environment public works committee. the report is red tape is making americans sick. it is the result of the high unemployment rate. people lose their jobs and are out of work for long periods of time as we are seeing right now with over 8 percent unemployment. those folks who are out of work but want to go to work more incidents of illness and there are rules and regulations costly

to our economy and add very little benefit to the environ pment. >> after years of consumer reporting i came around to the same conclusion but i assume when you say this to most people they say what are you talking about? the epa it makes america cleaner and that has to be good for our health. >> if you take a look at where we used to be the air is cleaner water is cleaner all of those things are true. >> now we are at a point we are to get a small improvement. it is very expensive in terms of actual dollars and production of energy as well as in the health of people that are out of work. we see a higher risk of high blood pressure, you see stroke, heart disease, as well as depression, anxiety. higher cancer in these people

and higher rate of suicide. >> it means the factory may not open. it means every business takes longer to open. it means money that might have gone to create new things now goes to pollution control which we want but that doesn't create the job that a free economy does. >> it closes down power plants 50 over the country that closed or announced to close impact of that on communities and all of the lost jobs with i are good paying jobs with benefits is devastating to that community. this administration has now issued over 1300 -- finalized over 1300 regulations that are called economically significant regulations meaning they cost for the economy. >> even the administration the epa admits that. >> the cost is over $100 million per regulation. the epa says the benefits are so great. the benefits are a reduction in

the future healthcare costs to people. there is no way to prove that. the costs are real but the benefits are unknown. people are out of work we have a long period of unemployment in the country and they know people are being made sick by the regulations because they can't get back to work. >> epa has a press release the benefits are avoiding early death. pref sainting heart -- preventing heart attacks and asthma. >> that's their made up numbers these are people sitting behind their computer screens who are fixated on small incremental improvements and we found they are cooking the books. fundamentally we see the people out of work for an extended period of time have kronner long-term unemployment higher risks of premature death, hire risk of heart disease, higher

risk of sfoeks. run the list of high blood pressure anxiety, depression, police chiefs now are reporting higher incidents of spousal abuse in a innumber of cities a it has to do with the economy and unemployment. >> what reaction to you get from fellow senators? >> colleagues and people who practice medicine like i have for 25 years and taken care of individual patients who have been out of work for extended period of time know the added stress that that puts on a family. they understand that. people who are fixated with the epa they are following a different drummer and are buying into the beliefs of the extreme environ pment tal lists. >> what you think you may know may not be so. people may think the epa is saving us every day. here's the reaction from a big deal california senator. >> senator's comments he lives

in an alternate universe. >> this is what my neighbors in new york say when i say this stuff. >> barbara is the chair of the environment public works committee. that's why i am working hard for them to take over the senate. she will not be the chairman any more and democrats and environmental agenda which is an extreme agenda won't be in charge of calling the shots on this. i worry about this unemployment rate which continues to be so sigh so many americans out of work. i want to get a healthy economy and a healthy environment and i think we can do both of them if we follow this extreme environmental agenda which is very, very costly. the benefits are unknown. i don't think we are helping our country. >> thank you. coming up of more examples of how what you think you know may not be so. for example, do you steal ever? you say no.

but my camera caught people in the act. [ cellphone rings ] the wife. hey, babe. got the jetta. i wiped the floor with the guy! not really. i would've been fine with 0% for 36 months, but i demanded 60. no...i didn't do that. it was like taking candy from a baby. you're a grown man. alright, see you at home. [ male announcer ] the volkswagen autobahn for all event. we good? we're good. [ male announcer ] at 0% apr for 60 months, no one needs to know how easy it was to get your new volkswagen. that's the power of german engineering. insuring that stuff must be a pain. nah, he's probably got... [ dennis' voice ] allstate. they can bundle all your policies together. lot of paperwork. [ doug's voice ] actually... [ dennis' voice ] an allstate agent can he do the switching and paperwork for you. well, it probably costs a lot. [ dennis' voice ] allstate can save you up to 30% more when you bundle. well, his dog's stupid. [ dennis' voice ] poodles are one of the world's smartest breeds.

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>> >> we all have bias but i grew up leaving sigh tiss were special. some unusually unbiassed, careful, trust worthy. >> they are very accurate down to earth people. >> probably nerdy. >> i know a lot of research scientist people who are very dry. >> some scientists are dry. my older brother is a scientist. he can be very dry. wait a second. he is also weird and angry sometimes and that volatility is

common in science says the author of free radicals the secret anarchy of science. anarchy michael brooks what has given us some tof the greatest scientific breakthroughs. a anarc anarchy? >> lying, cheating, sometimes just taking all kinds of things to get the job done. >> you say one fifth of scientists worldwide, one 5th. >> that is voluntary self disclosure. >> by nature. >> they would be happy to do this occasionally in order to concentrate more or to be more creative and have thoughts no one else had. there are cases where people have done extraordinary things while having taken these kind of substances. >> scientists who won a nobel

prize for his work on dna says he was high on lsd. >> he said he couldn't have dnen it without taking lsd. if he had he doesn't think veld a mobile prize. helped him to copy dna. >> they also break the rules. barry marshall who cured all sers for people around the world by figuring out it was bacteria. he had to break what rule? >> he broke the ethical rule about how you could go about doing an experiment. you get preapproval and colleagues think it might be dangerous. butn order to win his nobel prize he drank a couple of bacteria to prove that they would cause a stomach ulcer inside of him. his colleagues had to go along with it. don't ask don't tell thing. >> they took sack pemples of hi.

>> he said he didn't even tell his wife. he said it would be better to get forgiveness than permission. >> thank goodness. because all of pethese people drinking milk now they have help. >> you talk about lies deceit. >> the university seminars every now and then and there are a lot of deceit and fraud that guys on. one-third of scientists admit to one-third of research fraud in the last 7 years. another survey is dez discrediting it for themselves. it's what you have to do to get the job done. the experiments don't go like you expect them to and colleagues are also out to get you. you have to work hard to make sure you have the results you want. >> my brother is upset about all of these new financial

disclosure rules because people think if there's money to be made it will buy us the science. he says just competition. we want to kill each other. my colleagues would run over their grandmothers to get some advancement. >> absolutely. there is no prize for second place in science. you don't come across very many rich scientists either. it's not a way to make a lot of money. you have fame for making this discovery. it's an intensely competitive thing. >> why don't people know about this anarchy. >> it is interesting because it is like a brand wants to make itself look good. goes back to the second world war where people hated scientists. they made the atomic bomb. in the name of science effectively. people were distrustful of scientists. they made sure they didn't do anything the public may be

squared of. they said they were objective ultimate trust worthy. we are not going to blow up the world we are going to make the world a better place. >> even albert einstein you say there's a big myth about him. si einstein proved the theory of relative vit. >> (inaudible). >> he was brilliant but e equals mc squared? >> not quite einstein. he owned it during most of his lifetime. the problem was he tried to prove it 8 times and every time there was something wrong with his proof. he wrote in the footnote at one point in the footnote it said it didn't but let's go on anyway. his colleagues all knew this. by the end of his life his au autobiography he left e equals

mc squared out. that tells you what he ultimately felt. >> you argue scientists ought to admit this stuff open up. >> we want our kids to engage in science. >> you will be scared of them again. >> i don't think we will. we are scared of people like robots. we like human beings. we will for give them their flaws and these kind of behaviors. it makes them more like us. >> coming up, what you don't know about cheating. [ male announcer ] drive a car filled with as much advanced technology as the world around it. with the available leus enform app suite, you can use opentable to make restaurant reservations. during the golden opportunity sales event, get great values on se of our newest models. this is the pursuit of perfection.

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>> >> do you cheat? ever? never? you lie to be polite to people, right? you say you look thin or maybe you take pens home from work. you probably don't take petty cash home from work. why? where is the line? intuition tells us what stops people are from cheating is the risk of being caught exceed the benefit of getting something for nothing. the author of the honest truth about dishonesty how we lie to everyone especially ourselves is not the he is a psychology professor at duke. it's not about i getting away

with it? >> getting rid of a small part of it. it comes from the site we have two recommendations we want to view ourselves as honest one we want to benefit from the honesty. we balance two forces. how can you do both you either honor or cheat. as long as you cheat just a little bit we can cheat and still think of ourselves as honest people. taking paper from work works well but taking petty cash it's not the same degree you can't justify it. >> even in golf. there are easy ways to cheat in golf and hard ways. if you take a ball and move it 4 inches deliberately this is a no no or kicking had a little bit or kicking it slightly it is okay. >> what is the psychological

rational? >> it wasn't really me. everybody else is doing this. this is what they say. >> everybody else is doing it idea. you say cheating is contagious like an infection. >> in cheating we teach kids how to cheat. we tell them to be polite. somebody with an injury when kids point at me and ask what happened to this guy? parents always say -- >> your face was injured in an explosion. >> my body was burned when i have shorts it's much more clear. when kids point at that the parents say don't do that. it's i am polite. >> how is it cheating to say to the kids don't embarrass him, don't point to him? >> it is saying to the kids don't say everything that is on your mind. don't be fully honest. you can have inside dialogue but it's not something we do. we have to keep a front and don't be perfectly honest.

>> doping in sports. >> think about doping in sports. all of these people who dope in sports. what do you think is acceptable and not acceptable? >> the other athletes they are doing it you are a sucker if you don't. >> this physician he has a lot of places. he says the actual amount of doping is larger than most. >> the thing is anybody is doing it. >> i went to miami beach and got the hotel to put out a buffet under a banner that says fsn society. they weren't expecting the members made the group up. it stands for something for nothing. the buffet was appealing lamb chops shrimp, fruit.

people quickly started inspecting the food. >> you are the psychologist. did people take the food? >> what i would predict is something pristine out there and you are the first person is a signal. nobody else has touched it before they feel it would be really hard. once something starts breaking down it runs. >> we put the stuff out for five minutes nobody touched it. they respected other people's property. i was worried did i waste all of this money on the experiment for nothing? but then soon others started to take and more did and i confronted somebody about it and most were embarrassed. >> this is for the fsn society. >> oh, i am sorry. >> put it back? >> no, keep it. >> many freeloaders weren't ashamed as well.

>> are you embarrassed? >> no, are you? >> you are coming in for five shrimp here? >> it's a shame to waste those shrimp so i ate a couple of them. >> teachers are not paid enough. this is the kind of rational people use? >> yes. teachers aren't paid enough. they cheated us at some point in the past. everybody is doing this. there are a lot of stories people can tell us. >> this group. >> we take a sheet of paper with 20 different matt problems everybody can solve if they have enough time. give them the sheet and say solve as many as you can in five minutes and i will pay you for your performance. you solve as many as you can. at the end of the 5 minutes i say stop count how many you got correctly. now that you know the number go to the back of the room and shred the piece of paper. tell me how nanny you got

correctly. >> totally hon know shonor syst. you destroy the evidence. people reported average 6 problems. what people don't know in the experiment. we played with the shredder. it only shredded side of the page. we can find out how many questions really got. on average they had 4 and report 6. lots of people cheat add little bit. lots of people cheat by a few questions. to test a group of them we added two components. the first thing we hired an acting student. 30 seconds in the experiment said i solved everything. >> he was obviously cheating. >> you are still working on problem 1 you know nobody solved everything. the second thing we did was we gave people all of the money up front they paid themselves. the minute he raised his hand you solved everything take the envelope and go home. you see someone cheat in an

egregious way. >> lots of people copied him. one way is to say we proved to people in this experiment you can cheat and get away with it. the other thing the demonstration you told people people liked him for the same social group of cheating to which one of whom we are testing in a few ways but one of them was we changed the outfit of the acting student. everybody in the experiment in the regular condition they had the available outfit. in the second iks pir iment he was weari -- experiment he was wearing university of pittsburgh uniform. what happens when someone in an outside group cheats? cheating is involved. other people we don't like so much. >> i am not part of that. people became more honest. >> what else can we do to increase honest de? >> we asked a group of about 500

students called the ten commandments and they couldn't recall the ten commandments and others -- all of those people stopped about the ten command ams. we get them to go in the bible they stop cheating. >> at thit makes people more ho. >> people can be more restrict tive. investigation of lower morality people are vigilant. it is one of the tricks. >> coming up more on what you think you know... @@@

>> it'sorest fi

>> forest fire season. forests are raging out west. who leads the fight against these fires? the u.s. forest service. it spends billions fighting fire with chemicals near the fyhrie retardants that are supposed to slow the spread. given that fighting the fires is what the forest service does. i would think they would be careful to use the right flame retardant. but do they? it is one more government bureaucracy after all. who o how often do they do the latest how often does it change at all? not often. i am not surprised peter cordoni says he has a better flame retardant one that is used by more than 200 fire departments but not the forest service. ed klein man used to work for the forest service but now he works for peter. you are an inventor you make soil enhancers it is not your

normal business. >> all life saving products we use. the only product that works efficiently today unfortunately. >> how did you discover this? >> about ten years ago i was fooling around in another project i stuck my hand in it put it on an i say cream stick. >> it felt cool. >> i showed it to people i put it on an i say cream stick we started to light it. that's how it started. it went up from there. started showing it to fire departments different people had the knowledge that i didn't have at the time of the fire and they said you may have hit upon something unbelievable. >> some embraced it enthusiastically and some government agencies. >> it is very unique. you can use it direct impingement on a fire you can cool a fire down you can create a fire break they can be used for numerous fires. >> you work for the forest service. this is bert, i say this.

you brought some, let's play with it here if this is better why wouldn't the forest service do it? >> they are stuck in the mold of using one product they have used for about 50 years in the way they have used it and for one reason or another they are slow to adapt to a product that is obviously half the product. >> it is lighter which is a big issue with the planes they fly overhead th overhead. they don't want to use this stuff it may ee vab ra-- evapor the time they get to the fire. >> it is like spray painting a lawn chair from 10 feet away the way we are using the chemical now. >> forest service says most are suppressed by indirect attack.

they emit too much heat for direct attacks to be safe. >> a forest fire isn't like an avalanche or tsunami. it doesn't just move across a landscape it consumes fuel in front of it and it needs fuel available in order to propagate itself. what happens is the fire will propagate itself out in front of itself and this works behind the fire and works on the heat is something that is done by every country in the world. >> in new mexico we put fires out 300 acres. >> some state governments are starting to use it because they are finding it is the way to go. look at what is going on around us. we are losing homes and this

will protect homes. >> you say it is so good if i stick my hand in this thing and i could stick it in fire and i won't be burned. >> firefighters people are trapped in fires. this is one product you can coat them with to give the team minutes to get you out. >> he says my hand won't catch fire. let's try it. fox won't let me to try it in the studio. they don't trust me not to burn it down. if we do this we have to go outside. let's go. maybe i will stick my hand in the fire after i coat myself with this, let's run the test. we will see if he is telling the truth. visit redlobster.com now for an exclusive $10 coupon. good through august 5th

>> weare back, outside my studio. the studio's right in th >> peter claims his fire retardant which the u.s. forest service won't use it is so good when it is on my skin i can stick my hand in here and i won't be hurt? >> no. correct. >> so, what do i do? i dip my hand in here. >> scoop it out. >> scoop it out. >> keep your fingers tight together. >> okay. my hand isn't catching fire. creepy. you have a superior product but the u.s. pore rest service doesn't use it. you would think the government would use the best techniques and products to fight fires what you think you know often is not so. i have learned that repeatedly in my 40 years reporting. often in my research i find what i thought i knew isn't true.

for years the experts said we are running out of oil. people told me premium gas is better for your car. it is not better. you are racing your money unless you have a very unusual car. everyone knows that cousins shouldn't and can't get married cousins can legally marry in half of the states. everybody knows women are bad drivers but where is the evidence? turns out we men pay higher insurance rates because we are much more likely to crash. one more myth. do we have a full moon tonight? no. because police and hospital workers tell us when the moon is full there are more accidents and more crimes. something about the full moon makes people crazy. scientists looked at the data it turns out that is totally false, too. when it is happening and there is a full moon they notice that.

when there is a full moon you don't remember. there are so many myths that stupid things people believe i wrote a book about them. but i soon realized the biggest myth and the most dangerous one is when we have problems, solutions most likely come from government. it is intuitive to think the wise people in washington state capital know more than we therefore they should slam much of their lives. it's not true. that's why i wrote my new book no they can't. we free people pursuing our own interests are far more likely to solve problems. government fails. but individuals succeed. individuals like peter create prosperity it's the politicians and bureaucrats will get out of the way. that's our show. thanks for not setting me on fire and thank you for watching. good night. ♪

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>> this is the fox report. i am harris falkner. several wal-mart stores on alert in different states. some evacuating shoppers as a precaution. some a rash of bomb threats. governor mitt romney sending a message to iran in that country's own backyard. addressing one of the biggest concerns by the u.s. israel and much of the world israel and nucle nuclear oo. >> we will not look away nor will my country. >> that's not all he is saying during his visit to israel. fox report live from jerusalem. >> have you looked at your nest egg lately? we are seeing a surge and with the stock market set to open for a new week many investors watching to see if it will continue. what is driving latest rally? what could bring it all to a halt? also adding insult in injury.

why police arrested a boat captain after an alligator bit off his hand. we will not look away. the message to israel from governor mitt romney speaking in jerusalem saying the united states has a moral duty to block iran from achieving nuclear weapons capability. >> make no mistake. the ayatollahs in tehran are testing our moral defenses they want to know who will object and who will look away. my message to the people of israel and the leaders of iran is one in the same. we will not lock away. nor will my country ever look away. >> israel the second of three stops for mr. romney in the weeks before he is expected to claim the republican nomination. he visited the western wall and met with netanyahu along with perez a goal of romney's overseas trip to demonstrate the competence on the world stage. he cut into the pre