Free To Choose 1980 – From Cradle to Grave – Negative Income Tax — Transcript

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1. 0:00The issue that I have is:
2. 0:02Where do children come in?
3. 0:03What are their rights under a negative income tax?
4. 0:06And are we, by building in a negative income tax,
5. 0:09in fact subsidizing the illegitimacy that
6. 0:12Tom Sowell is so concerned about?
7. 0:14FRIEDMAN: The major reason it is not feasible today
8. 0:16to have a negative income tax is because the
9. 0:19present welfare bureaucracy would be out of work.
10. 0:22They are the major objectors and as Senator Pat
11. 0:26- he's now a senator, Pat Moynihan demonstrated
12. 0:29in his book on the Nixon program,
13. 0:31the chief obstacle to getting it enacted
14. 0:33was the welfare bureaucracy.
15. 0:35So that I don't believe these administrative problems,
16. 0:38if you got it enacted, would be at all serious.
17. 0:40O'BANNON: I think the other assumption under
18. 0:42the negative income tax, and it's
19. 0:43one that I'm not sure I can buy,
20. 0:45is that everybody has a minimum level
21. 0:47of understanding about how to spend money.
22. 0:50In other words, how to use the
23. 0:50marketplace to satisfy wishes.
24. 0:52And I, as an economist, would say, yes, we do.
25. 0:56We - everybody from age four to a hundred
26. 1:00knows how to use money
27. 1:02to satisfy wants and that's the...
28. 1:05FRIEDMAN: But they don't. They don't!
29. 1:06There are all sorts of problems
30. 1:07of people who are not going to be able to.
31. 1:09But that's a minority problem.
32. 1:11That's a problem for private activity
33. 1:12and private charity.
34. 1:13One thing is sure: they're spending...
35. 1:17they would be spending their own money,
36. 1:18and that however knowledgeable
37. 1:21you are about spending money...
38. 1:22O'BANNON: They would be spending my money!
39. 1:23They...I...
40. 1:23FRIEDMAN: They would be spending my money,
41. 1:24but it would be one stage less bad.
42. 1:27Right now, the welfare worker is spending
43. 1:30Mr. A's money to help Mr. C.
44. 1:33And there's a big takeoff
45. 1:35in the middle as Tom Sowell said.
46. 1:36The question is not whether the people
47. 1:38on welfare or low incomes
48. 1:39can all spend their money effectively;
49. 1:41the question is: How effectively do they
50. 1:43spend it as compared to how effectively
51. 1:45the bureaucrats spend it for them?
52. 1:47Comparing anything to perfection or to
53. 1:49some arbitrary standard settles nothing.
54. 1:52The same thing is true in the education area.
55. 1:54They're saying: “Would families be able to
56. 1:55spend their - select schools for their
57. 1:57kids under a voucher system?"
58. 1:58For example: Well, the question is:
59. 1:59Could they possibly do much worse
60. 2:01than the current bureaucrats are doing
61. 2:02in the public school system?