July 4, 2025 • 28 mins
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Speaker 1 (00:09):
Well, welcome back.
Speaker 2 (00:10):
And as you know, one of the big stories today
has been the last couple of days is the big
beautiful bill trying to work its way through Congress, which
is basically the President's proposed reconciliation bill, which is the budget.
And couldn't be more timely for us to have with
us somebody a highly respect and that is Professor Murray
(00:32):
Sabran's back with us today, Emeritith, Professor of Finance at
Ramapo College there in New Jersey. Is the author of
several books, and his personal autobiography is a fascinating read.
From immigrant to public intellectual, it truly is an American story.
Speaker 1 (00:48):
So check out his book.
Speaker 2 (00:50):
And he does have a website Murray Sabran dot substack
dot com. And there you go, Ma FIHI explain that
there's the big T shirt right there, Professor. Good to
see again, Fredd, He've got the head.
Speaker 3 (01:06):
Great to be with you, Perry. It's always a delight
to us spend the time with you going over the
big picture.
Speaker 1 (01:13):
Yeah, you're the man. So m a f I is.
Speaker 3 (01:17):
Make Americans financially independent?
Speaker 2 (01:20):
Okay, yeah, A big amen to that one.
Speaker 3 (01:24):
Well that's what I learned growing up. I saw my
father go to work. He worked five days a week
and occasionally worked on the weekends, and he provided for
his family, not making a lot of money, but enough
to make sure that we weren't on welfare. And it
was food on the table. The rent was paid, and
we enjoyed our summers in the Casco Mountains.
Speaker 2 (01:46):
Okay, the big beautiful bill, it's bumping around in Congress.
Speaker 1 (01:50):
What's your thirty thousand foot view of this?
Speaker 3 (01:53):
Well, it's big, but it's certainly not beautiful. I can
tell you that someone who's someone who's been advocating government
and the constitutional federal budget and getting the government off
our backs, as Reagan talked about in his nineteen eighty
Preidential campaign, And I wish Donald Trump would channels what
(02:14):
Ronald Reagan said when he famously said that the most
dangerous sentence in the English language is I'm from the government,
that I'm here to help.
Speaker 1 (02:22):
You, right, all right?
Speaker 2 (02:25):
So is there another way to do this? I mean,
there's an ideological way to do this, but I mean
the reality is you're dealing with so many variables. In Congress,
they say it's like making sausage. And those who were
asking for changes in the bill.
Speaker 1 (02:41):
They may have been modified. I don't know.
Speaker 2 (02:43):
Is there anything in the bill you don't like that
just glaring at you.
Speaker 3 (02:48):
Well, I think the reason that we're in this mess, Perry,
and it is a huge mess because we've had almost
a ninety years of bigger and bigger budgets charting with
the Hoover administration, the Rosevelt administration, and the government has
taken over the economy and such a long way. I
call it now the pineapple economy. Most people are on
(03:11):
the dole and we know the dough Pineapple company has
been around for ages. And that's what America has become,
not a banana republic, but pineapple economy. What Trump needs
to do is address the nation and saying, listen, we
have an unsustainable federal budget. We have an unconschable national
debt where we're spending a trillion dollars a year on interest,
(03:32):
and we need to downsize the federal government in a
systematic way that is going to have very little pain,
if none at all, if we follow the following roadmap,
and this is what I wrote about it in my
article at the Mesa's Institute in March, how to create
a constitutional federal budget, and it's pretty simple. Warren Buffett
(03:55):
just announced he's going to retire. He's ninety four years old.
He can get off social Security and Medicare. Wealthy people
don't need Social Security and Medicare. I know this is
a very controversial issue because people say they've paid into
the system. Well, the thing is, you don't have your
own account. What you have as a promise from the
federal government to give you a retirement income plus paying
(04:18):
for some of your health costs at retirement. Trump could
start the ball rolling. He and I are the same age.
He can say I'm going to renounce social Security and Medicare,
so my children and We're going to save for our
own retirement. I'm going to use my own income to
pay for my needs are And he should say the
(04:39):
American people need to have clarity on these issues, and
we need to go to a financial independence, which is
ironically what the Declaration of Independence talks about. It talked
about life liberty and the pursuit of happiness. And so
by keeping your own money, you will then decide what
to spend your money on, what charities you want to
donate to, how much to say for your retirement and
(05:02):
that's the way that human beings should organize themselves on
the freedom principle. And Trump is not articulating that. He
just talks about more spending. He says, we're not going
to touch Social Security, Medicare, and medicaid, which are the
three biggest programs of the federal government, besides interests on
the national debt and national defense. And from my perspective,
the federal budget should be very lean in terms of
(05:25):
being consistent with Article one, Section eight of the Constitution,
which doesn't authorize all the social welfare spending, all this
foreign aid, all this military expenditures for foreign nations. And
if we really want to have an American first government policy,
then Trump needs to embrace these ideas, ideals that the
founders envisioned two hundred and fifty years ago.
Speaker 2 (05:49):
As the administrations they may have painted themselves into a
corner here in that if this bill doesn't pass, then
the previous tax cuts and that would balloon the deficit
and that would probably throw us into some kind of
a recession. Or am I misunderstanding that, Well.
Speaker 3 (06:10):
This is the problem with the so called big beautiful bill.
You're throwing everything into the kitchen sink and Hopefully people
will say this is a great thing to have each
item in the federal budget should be voted on separately,
so we could see people's votes on taxes, regulation, spending,
foreign aid, and things like that. Instead, you have these
(06:32):
comprehensive bills, and there are people that are voting on
things that I'm sure they're holding their nose and voting
for because it's either not good for their constituents or
it just violates their own conscience and what they believe
the federal government should be doing. That's why I'm opposed
to all these omnibus, huge bills, because I couldn't vote
(06:52):
on these bills because it violates some principles that I've
been advocating for half a century, which is we need
to have a constitutional government and we don't have that today.
And again, the problem is not Republican a Democrat. It's ideological.
It's what do we think the federal government should be doing?
And the constitution provides that answer. And I'm sorry if
(07:13):
some of the mag of people don't agree with me,
But the point is Trump was elected on shaking Washington up.
All he's doing is cementing what Washington is doing.
Speaker 2 (07:24):
Okay, in the meantime, the moody has downgraded the US
credit rating because of the deficit. How does this bill
address that or does it.
Speaker 3 (07:36):
It doesn't according to some projections, The Committee for Responsible
Federal Budget has projected that the interest on the national
debt will be three trillion dollars in the next decade
and that will take up thirty percent of the federal budget.
That is Banana Republic. A fiscal situation when countries have
(07:59):
gotten into trouble where they've spent so much money that
they can't they don't raise enough money to pay their bills.
Then the central bank steps in and basically prints money
to help the government pay its bills, and then you're
off to the races with hyperinflation. That's happened in Argentina, Brazil,
East European countries. It's happened throughout the world. It happened
(08:19):
in China after World War Two. It happened in Russia
that led to the Soviet Revolution. So we have historical
examples where nation's financial situation gets so out of whack
that the central bank comes in and thinks it's saving
the day, rather than telling the powers that be, you've
got to cut spending or raise taxes, and we know
(08:42):
raising taxes is a kiss of death for any politician.
So you've got to cut spending and it's easy to do.
Reagan ran on a platform of getting rid of the
Department of Energy and Education, and they're still going strong
after forty five years. So what we need to do
is sit down with both party the leadership of both parties,
(09:03):
and come to an agreement. What are you going to
cut that is consistent with the constitution immediately so we
can get closer to a balanced budget. Because the budget
right now is seven point two trillion dollars and according
to the projections this year fiscal twenty twenty five, which
ends September thirtieth, we will have a two and a
(09:23):
half trillion dollar deficit. That's why Moody said this is unsustainable.
And they're the last third credit agency to us make
the warning that the federal government needs to reform itself
and it's not doing it.
Speaker 2 (09:38):
In the meantime, dozes found a lot of fat and
fraud and it is being cut now. I guess maybe
cutting it means we're just going to stop funding it.
In the meantime, other cuts have been made, so it
seems like for the first time long time on the
cutting side of things, it is happening. Maybe not at
(09:58):
the level or the degree we'd like to to see it,
but we are now cutting things. But you have to
in order to balance the butt. You have to offset
the cutting with additional revenue. And it seems like what
the President's trying to tell us is that tariffs is
offsetting the cutting.
Speaker 1 (10:18):
The revenue from.
Speaker 2 (10:19):
Tariffs will lost at the cut. As crazy as all
that sounds, what else do you.
Speaker 3 (10:24):
Do, Well, you sit down line by line. He should
bring in his cabinet and tell each cabinet officer, cut
your budget ten percent. That's what that would be demanded
from the sea from the president. Cut your budgets ten percent.
You can do so. You can eliminate, and I've called
(10:47):
for this for decades, eliminate aid to higher education colleges
and universities like Harvard that has a fifty five billion
dollar endowment. They don't need any federal aid, which is
what taxpayer colleges and university should be independent, financially responsible institutions.
They should get their money from tuition grants, donations, et cetera,
(11:09):
et cetera, et cetera. Things that nonprofits do in order
to operate. We have essentially a huge money laundering operation.
The federal government takes money from the people and businesses,
it grows around the bureaucracy, and then it goes back
to businesses, agriculture, states, local governments, and the people. And
(11:32):
this is why if you don't have financial independence in
a society, you grow a welfare state, which then becomes unsustainable.
And we're really at the last weeks, months, years of
this experiment called the welfare state. And foreigners know this
because they've gone through the ringer all over the world,
and so that's why they're very leery of US debt.
(11:54):
They're leery of holding dollars. And so I think that's
why the price of gold is where it is, and
it's going to go a lot higher over the next
several years as central banks have been loading up on
gold to protect their financial situation, because gold is the
ultimate money. Gold is money, paper is what Fiat money
is not really money, it's it's just tokens that we
(12:17):
use now they're all mostly digital tokens. And that it
doesn't end well. Perry and those of us that have
been writing about this, speaking out about this for many,
many years. I realize that nothing changes in Washington except
who's president and who's in Congress. But the policies don't
(12:37):
seem to change. And that's why it's frustrating for someone
like me. Why isn't common sense being used to downsize
the federal government? I mean, Department of Education doesn't educate
a child. Teachers educate a child. So in our society,
we have the government taking over half of medical care
with Social Medicare and Medicaid and all the other programs.
(13:02):
We have the foodstamp programs which is now called SNAP,
the Supplemental Nutrition program. Parents are responsible for raising their kids,
not the federal government, not the state governments, not the
local governments, so we have a breakdown in the family.
We have a lot of children born out of wedlock,
so they don't have a stable family home, and unfortunately,
(13:22):
people rely on the federal government and other levels of
government to provide them with basic sustenance. And this is
why we need to really have a national dialogue about
what the federal government to do. And I think the
mistake that Trump is making he's not bringing in the
Democrats in these discussions. He's doing it strictly on a
party basis, and that's why the Democrats are voting in
(13:45):
a block against everything that Trump wants to do, instead
of saying, hey, we're all in this together, which everyone,
every politician says that. So let's sit down and have
a meeting of the minds about what's good for the
American people. That's what's good for our next election prospect.
Speaker 1 (14:01):
Okay, I understand all that.
Speaker 2 (14:02):
I guess the other thing coming back to the central
banks and the Feds.
Speaker 3 (14:08):
What do we do.
Speaker 2 (14:09):
They seem to be a powerful, unseen arm in this
whole equation.
Speaker 3 (14:14):
Well, this is why I think the Federal Reserve now
is between the rock and the heart place. I mean,
they've kept interest rates basically flat for quite a while
now because they think that well, they know that if
they keep if they lower interust rates, which means pumping
money into the banking system, it's going to ignite another
round of inflation. And by the way, the Federal Reserve,
(14:35):
although it hasn't lowered interst rates, it has been buying
government debt, which is essentially creating money out of thin air.
And so the Fed is doing this without making any announcements.
I think they just bought fifty billion dollars of the
federal government's debt. So they're easing monetary conditions by pumping
money into the banking system by buying all this debt.
(14:58):
And so we're going to see another round of inflation
probably next year. Right now, we're seeing the effects of
the higher interest rates that we had for several years
right now. But I think that'll turn around next year.
And then, of course, what happens in the midterm elections
in twenty twenty six. If inflation, which I think will happen,
will accelerate, and then Trump is going to be in
(15:21):
a very delicate position of saying, hey, I didn't cause
this inflation. The Fed did. But he wants to Fed
to lower interest rates right now, which will put gasoline
onto the fire, so to speak, of inflation. So again,
the Feds between a rock and a heart place, the
federal governments between a rock and heart place. And no
one in Washington except a few handful of people want
(15:43):
to say no to this out of control spending.
Speaker 1 (15:46):
What do you do?
Speaker 2 (15:51):
There's another element here that could be effective, and that
is the price of energy. We've talked about it, but
we really haven't lowered it signific it seems like the
East coast doing great. We on the West coast, we're
still looking at over four dollars a gallon, So something's
going on here.
Speaker 3 (16:09):
Yeah, I think that this is a local phenomenon. So
I think people on the West Coast need to find
out what's going on with the dynamics of supply, because
if supply is down or there's just a lot of
taxes on energy on the West coast. Here in Florida,
prices have come down considerably and we're seeing the benefits
(16:29):
of sixty dollars gallon sixty dollars barrel oil. I mean,
why Trump announced an energy emergency when he came into office.
I mean, the price was well below one hundred dollars,
and so that's not an emergency. I mean, in real terms,
gasoline is relively inexpensive compared to where it was twenty
thirty years ago when we had four and five dollars gasoline.
(16:52):
Now we have three four dollar gasoline. In some places
it's well under three dollars. So again, energy is just
a reflection of supply and demand in the marketplace, including
the Fed's money printing. So again, the people on the
West Coast really need to do a deep dive and
why prices are staying well above the national average, and
(17:14):
it has to do with maybe refining capacity, UH regulations
that are making it difficult for the refiners to get
the product to the marketplace. So there are a whole
host of factors that can that can disrupt the supply chain.
Speaker 1 (17:25):
Okay, let me take a quick break.
Speaker 2 (17:27):
Check out the professor's website Murray Sabran s A B
R I N dot substack dot com, and you can
also check out his his his book, his personal autobiography, UH,
from Immigrant to Public Intellectual and American Story Beautiful World.
Be right back, all right, Welcome back, Professor Murray Sabran
(18:00):
back with us today. He's a professor emerituser at the
Ramapo College in New Jersey. Financed his couple of books,
but his personal story From Immigrant to Public intellectional I
think you'll find to be a very inspiring read. He
does have a website and that's Mary Saberant substack dot com.
Speaker 1 (18:18):
Professor.
Speaker 2 (18:19):
A couple of things that I just want to keep
it at the thirty thousand foot view.
Speaker 1 (18:22):
I don't and I want it. This sounds political.
Speaker 2 (18:24):
I don't mean it to be, but My observation is
the Dems don't want to cut anything.
Speaker 3 (18:29):
Absolutely, this is the problem. The Dems have been on
the road to bigger and bigger governments since FDR, actually
since Wilson, because Wilson and his administration, the we got
the Federal Reserve, the income tax was enacted just before
he took office in nineteen thirteen. He took office back
then in March of nineteen thirteen after being elected in
(18:51):
nineteen twelve. And Wilson, of course expanded the size of
government that maneuvered us into World War One when he
ran out a piece of platform in nineteen sixteen, and
then Roosevelt came in and did exactly what Hoover did.
That deepened the recession into a great depression, and Roosevelt
just continued that policy, so we had a depression for
a full decade. On precedent in American history. The Dems
(19:13):
want to take over everything. If you ask a Democrat
in private, what should the top tax rate be, they
probably would say ninety percent, like it was during World
War Two, which is an abomination. They think that socialism
is the answer that big government. We need big government
in healthcare, housing, welfare expenditures, I mean, they really believe
(19:35):
in the Marxist view of the world. They have a
Marxist view of the world. In fact, the irony is
that we have a Marxist tax code, the progressive income
taxes number two in the ten planks of the Communist Manifesto.
So it doesn't get more ironic than that. That the
United States for to get a Cold War against the
evil Marxist Soviet Union, and yet we have the same
(19:56):
tax code that Marx proposed in the mid nineteenth century.
Doesn't get more ironic than that. So but what Trump
needs to do is call out the Democrats and say,
tell us what you would do to streamline the federal government.
Because we know that the thirty six trillion dollar federal
deficit a debt is unsustainable and two trillion dollars two
(20:19):
trillion deficits are unsustainable. They of course want to raise
tax rates, which of course would undermine the economy. I
don't recall any time in American history where rates have
gone up and the economy has boomed. That's not the
way the world works. The way the world works is
that we need more investment in the capital sector, which
is produces the goods that we the people want, and
(20:43):
so in order to do that, you need less regulation,
less taxes on capital and Trump should call for the
immediate end of taxes on interest and dividends and capital gains.
That would be the biggest boost of the economy. Then tariffs,
And I just want to get back to the tariff issue.
Trump has this notion, as do a lot of his advisors,
that because the federal government raised money strictly through tariffs,
(21:07):
mainly through tariffs throughout the nineteenth century, and the economy
did extraordinary well during the nineteenth century from eighteen hundred
to nineteen hundred, therefore we should raise tariffs in order
to generate enough revenue for the federal government. Well, back then,
there was no social security, there was no Medicare, there
was no medicaid, there was no military industrial complex, there
(21:27):
was no massive interest in the federal debt. So that
comparing apples with oranges, that comparing the welfare warfare stay
today to the rev small government back in the nineteenth century.
And when you have a small government, you could use
the tariff to raise revenue. But the problem Parry was
the tariff was so high that middle income and low
(21:48):
income people were complaining about it, and the big trade
off was supposed to be the income tax was going
to raise revenue from the wealthy because ninety eight percent
of the American people from the first income tax, and
that the tariff would be reduced. Well, the Republican Party
was the high tariff party since Lincoln, and when Harding
was elected in nineteen twenty, we had the high income
(22:10):
taxes from World War One, and after they got in,
they raised the tariff rates back to where they were
before the income tax was enacted. So we got an
income tax and high tariffs. And despite that, the economy
boomed in the nineteen twenties because there was a lot
of investment in the new technology, which is radio and
(22:31):
automobile production went through the roof. So there was a
lot of good things happening. But the insidious thing was
happening was the Federal Reserve was pumping money in to
the economy and so prices were basically level flat when
they should have been going down, which is what the
benefits are to the American people when you have a
productive economy and prices go down, where the living standards
(22:53):
go up. And then of course we had prohibition as well,
which is another story. But the point is the nineteen
twenties is a great case study of total mismanagement by
the federal Reserve, even though the federal garment was kept
at a minimum.
Speaker 2 (23:06):
Okay, but there's some other things to consider here. It
appears now and I say this only from my observation
that everybody was shocked when the tariffs came out of
the table. Everybody was saying, what you're saying, that tariffs
don't work. Then we find out the tariff is a
tool to bring people to the table, an effective tool
to bring people to the table to at least maybe
(23:27):
get some balance to this trade. And he does go
over and he makes deals, and he brings one point
two trillion here and four hundred billion there and two
hundred million there, and he's got China basically on its
knees in some way. Whether the term tariff as you
describe it, and everybody pretty much agrees that it doesn't work.
(23:49):
In the long run, it's become one of the most
effective tools we've ever seen to help bring some things
back into line.
Speaker 3 (23:57):
Well, let me start with a few things. Balance trade
is a misconception we don't have as individuals. We don't
have balance trade with all the vendors, the stores that
we buy. We use Amazon, we shop at local supermarkets,
several local supermarkets. I don't have balance trade with them.
I buy from them because we have generate income and
(24:18):
retirement and they provide us with goods that we want.
So we don't have balance trade on an individual basis.
So why do we think that we need to have
balance trade? Quote between nations? Nations don't trade. Individuals and
businesses trade. That's the difference between the Trump and his
advisor's outlook on trade and my micro aspects of trade.
(24:38):
Trade is done between individual businesses and individual human beings.
They're not done by nations. Nations don't trade. Nations are
basically geographic political entities. So put that aside for a second.
The tool that I would use to boost the economy
would be getting rid of taxes on interest, dividends, and
(25:00):
capital gains. I agree with that, getting rid of the
corporate income tax, which which would make the United States
the freest economy in the world, where businesses would flock
here because if they didn't have to pay taxes on
their income, they would get a huge bonanza by locating
in the United States, and that would mean the creation
of millions of jobs here without the blunt tool of tariffs.
(25:23):
Tariffs sound good in principle in terms of trying to
get other countries to reciprocate. But the point I would
make is that all trade is fair white perry because
both parties have to agree to the transaction. That's the
notion of freedom and liberty and voluntary exchange. Both parties
(25:43):
have to agree in order to trade to take place.
And so if we really want to have a more
harmonious trading world, we just reduce our barriers. We could
do that unilaterally, and that would show the world that
the United States is serious about economic freedom.
Speaker 1 (26:00):
Okay, you make some very good points here. I have
to agree.
Speaker 2 (26:03):
I don't know why we're going to run out of
time here, but I don't know why the President hasn't
gone off the corporate rate. I mean, he talked about it,
but it's not being done. If there's anything that would
give this thing a supercharge, it.
Speaker 1 (26:14):
Would be that.
Speaker 3 (26:16):
There's no question about it. I mean, every time the
corporate rate goes down and the economy sense tends to
do better. I mean, why do I play a mind game?
Speaker 1 (26:24):
Why do you think he hasn't addressed that.
Speaker 3 (26:26):
I think for political reasons. I think he doesn't want
to be accused by the Democrats of giving supporting the wealthy. Well,
if you have capital perry, you create businesses. I mean,
that's why the Well Street Journal had a great article
the other day, which I posted on my substack, is
that small businesses are thriving because they find a niche
(26:47):
in the marketplace and they run with it. And there's
a profile of several businesses that started literally with nothing
but an idea and they're booming, like weather Tech is
doing eight hundred million dollars revenue when they were doing
nothing thirty years ago. Think of Amazon, Apple, Microsoft, Dell,
all these big companies that have gotten from an idea
(27:10):
in someone's living room or basement to a multi billion
dollar enterprise. And that's the way a free market economy works.
And Trump should get out there and say that we
are a nation of entrepreneurs, we're a nation of small businesses,
and we want to have the least burden on our
small businesses and other business as well. And come to America.
You'll pay very little taxes, if any at all, and
(27:31):
you could set up shop here, and we're going to
not bother you in terms of what you do, as
long as you've done peacefully and respect the environment and
so on and so forth.
Speaker 2 (27:39):
All right, go to Murraysabran dot substack dot com and
get one of his hats T shirts Make America Financially Independent, professor.
Thank you for your time. You're fascinating. Let's stay in
touch as all this kind of unwines. We got a
lot to look at, and we're only in this thing
six months.
Speaker 3 (28:00):
Well, the thing is, we have another three and a
half years and I just will continue to write about
the good, the bad, and the ugly in Washington.
Speaker 2 (28:07):
You're the man. Thank you, Frand good to see you.
Thanks for your time.
Speaker 3 (28:10):
Thank you, Perry. Great to be with you.
Well, welcome back.
Speaker 2 (00:10):
And as you know, one of the big stories today
has been the last couple of days is the big
beautiful bill trying to work its way through Congress, which
is basically the President's proposed reconciliation bill, which is the budget.
And couldn't be more timely for us to have with
us somebody a highly respect and that is Professor Murray
(00:32):
Sabran's back with us today, Emeritith, Professor of Finance at
Ramapo College there in New Jersey. Is the author of
several books, and his personal autobiography is a fascinating read.
From immigrant to public intellectual, it truly is an American story.
Speaker 1 (00:48):
So check out his book.
Speaker 2 (00:50):
And he does have a website Murray Sabran dot substack
dot com. And there you go, Ma FIHI explain that
there's the big T shirt right there, Professor. Good to
see again, Fredd, He've got the head.
Speaker 3 (01:06):
Great to be with you, Perry. It's always a delight
to us spend the time with you going over the
big picture.
Speaker 1 (01:13):
Yeah, you're the man. So m a f I is.
Speaker 3 (01:17):
Make Americans financially independent?
Speaker 2 (01:20):
Okay, yeah, A big amen to that one.
Speaker 3 (01:24):
Well that's what I learned growing up. I saw my
father go to work. He worked five days a week
and occasionally worked on the weekends, and he provided for
his family, not making a lot of money, but enough
to make sure that we weren't on welfare. And it
was food on the table. The rent was paid, and
we enjoyed our summers in the Casco Mountains.
Speaker 2 (01:46):
Okay, the big beautiful bill, it's bumping around in Congress.
Speaker 1 (01:50):
What's your thirty thousand foot view of this?
Speaker 3 (01:53):
Well, it's big, but it's certainly not beautiful. I can
tell you that someone who's someone who's been advocating government
and the constitutional federal budget and getting the government off
our backs, as Reagan talked about in his nineteen eighty
Preidential campaign, And I wish Donald Trump would channels what
(02:14):
Ronald Reagan said when he famously said that the most
dangerous sentence in the English language is I'm from the government,
that I'm here to help.
Speaker 1 (02:22):
You, right, all right?
Speaker 2 (02:25):
So is there another way to do this? I mean,
there's an ideological way to do this, but I mean
the reality is you're dealing with so many variables. In Congress,
they say it's like making sausage. And those who were
asking for changes in the bill.
Speaker 1 (02:41):
They may have been modified. I don't know.
Speaker 2 (02:43):
Is there anything in the bill you don't like that
just glaring at you.
Speaker 3 (02:48):
Well, I think the reason that we're in this mess, Perry,
and it is a huge mess because we've had almost
a ninety years of bigger and bigger budgets charting with
the Hoover administration, the Rosevelt administration, and the government has
taken over the economy and such a long way. I
call it now the pineapple economy. Most people are on
(03:11):
the dole and we know the dough Pineapple company has
been around for ages. And that's what America has become,
not a banana republic, but pineapple economy. What Trump needs
to do is address the nation and saying, listen, we
have an unsustainable federal budget. We have an unconschable national
debt where we're spending a trillion dollars a year on interest,
(03:32):
and we need to downsize the federal government in a
systematic way that is going to have very little pain,
if none at all, if we follow the following roadmap,
and this is what I wrote about it in my
article at the Mesa's Institute in March, how to create
a constitutional federal budget, and it's pretty simple. Warren Buffett
(03:55):
just announced he's going to retire. He's ninety four years old.
He can get off social Security and Medicare. Wealthy people
don't need Social Security and Medicare. I know this is
a very controversial issue because people say they've paid into
the system. Well, the thing is, you don't have your
own account. What you have as a promise from the
federal government to give you a retirement income plus paying
(04:18):
for some of your health costs at retirement. Trump could
start the ball rolling. He and I are the same age.
He can say I'm going to renounce social Security and Medicare,
so my children and We're going to save for our
own retirement. I'm going to use my own income to
pay for my needs are And he should say the
(04:39):
American people need to have clarity on these issues, and
we need to go to a financial independence, which is
ironically what the Declaration of Independence talks about. It talked
about life liberty and the pursuit of happiness. And so
by keeping your own money, you will then decide what
to spend your money on, what charities you want to
donate to, how much to say for your retirement and
(05:02):
that's the way that human beings should organize themselves on
the freedom principle. And Trump is not articulating that. He
just talks about more spending. He says, we're not going
to touch Social Security, Medicare, and medicaid, which are the
three biggest programs of the federal government, besides interests on
the national debt and national defense. And from my perspective,
the federal budget should be very lean in terms of
(05:25):
being consistent with Article one, Section eight of the Constitution,
which doesn't authorize all the social welfare spending, all this
foreign aid, all this military expenditures for foreign nations. And
if we really want to have an American first government policy,
then Trump needs to embrace these ideas, ideals that the
founders envisioned two hundred and fifty years ago.
Speaker 2 (05:49):
As the administrations they may have painted themselves into a
corner here in that if this bill doesn't pass, then
the previous tax cuts and that would balloon the deficit
and that would probably throw us into some kind of
a recession. Or am I misunderstanding that, Well.
Speaker 3 (06:10):
This is the problem with the so called big beautiful bill.
You're throwing everything into the kitchen sink and Hopefully people
will say this is a great thing to have each
item in the federal budget should be voted on separately,
so we could see people's votes on taxes, regulation, spending,
foreign aid, and things like that. Instead, you have these
(06:32):
comprehensive bills, and there are people that are voting on
things that I'm sure they're holding their nose and voting
for because it's either not good for their constituents or
it just violates their own conscience and what they believe
the federal government should be doing. That's why I'm opposed
to all these omnibus, huge bills, because I couldn't vote
(06:52):
on these bills because it violates some principles that I've
been advocating for half a century, which is we need
to have a constitutional government and we don't have that today.
And again, the problem is not Republican a Democrat. It's ideological.
It's what do we think the federal government should be doing?
And the constitution provides that answer. And I'm sorry if
(07:13):
some of the mag of people don't agree with me,
But the point is Trump was elected on shaking Washington up.
All he's doing is cementing what Washington is doing.
Speaker 2 (07:24):
Okay, in the meantime, the moody has downgraded the US
credit rating because of the deficit. How does this bill
address that or does it.
Speaker 3 (07:36):
It doesn't according to some projections, The Committee for Responsible
Federal Budget has projected that the interest on the national
debt will be three trillion dollars in the next decade
and that will take up thirty percent of the federal budget.
That is Banana Republic. A fiscal situation when countries have
(07:59):
gotten into trouble where they've spent so much money that
they can't they don't raise enough money to pay their bills.
Then the central bank steps in and basically prints money
to help the government pay its bills, and then you're
off to the races with hyperinflation. That's happened in Argentina, Brazil,
East European countries. It's happened throughout the world. It happened
(08:19):
in China after World War Two. It happened in Russia
that led to the Soviet Revolution. So we have historical
examples where nation's financial situation gets so out of whack
that the central bank comes in and thinks it's saving
the day, rather than telling the powers that be, you've
got to cut spending or raise taxes, and we know
(08:42):
raising taxes is a kiss of death for any politician.
So you've got to cut spending and it's easy to do.
Reagan ran on a platform of getting rid of the
Department of Energy and Education, and they're still going strong
after forty five years. So what we need to do
is sit down with both party the leadership of both parties,
(09:03):
and come to an agreement. What are you going to
cut that is consistent with the constitution immediately so we
can get closer to a balanced budget. Because the budget
right now is seven point two trillion dollars and according
to the projections this year fiscal twenty twenty five, which
ends September thirtieth, we will have a two and a
(09:23):
half trillion dollar deficit. That's why Moody said this is unsustainable.
And they're the last third credit agency to us make
the warning that the federal government needs to reform itself
and it's not doing it.
Speaker 2 (09:38):
In the meantime, dozes found a lot of fat and
fraud and it is being cut now. I guess maybe
cutting it means we're just going to stop funding it.
In the meantime, other cuts have been made, so it
seems like for the first time long time on the
cutting side of things, it is happening. Maybe not at
(09:58):
the level or the degree we'd like to to see it,
but we are now cutting things. But you have to
in order to balance the butt. You have to offset
the cutting with additional revenue. And it seems like what
the President's trying to tell us is that tariffs is
offsetting the cutting.
Speaker 1 (10:18):
The revenue from.
Speaker 2 (10:19):
Tariffs will lost at the cut. As crazy as all
that sounds, what else do you.
Speaker 3 (10:24):
Do, Well, you sit down line by line. He should
bring in his cabinet and tell each cabinet officer, cut
your budget ten percent. That's what that would be demanded
from the sea from the president. Cut your budgets ten percent.
You can do so. You can eliminate, and I've called
(10:47):
for this for decades, eliminate aid to higher education colleges
and universities like Harvard that has a fifty five billion
dollar endowment. They don't need any federal aid, which is
what taxpayer colleges and university should be independent, financially responsible institutions.
They should get their money from tuition grants, donations, et cetera,
(11:09):
et cetera, et cetera. Things that nonprofits do in order
to operate. We have essentially a huge money laundering operation.
The federal government takes money from the people and businesses,
it grows around the bureaucracy, and then it goes back
to businesses, agriculture, states, local governments, and the people. And
(11:32):
this is why if you don't have financial independence in
a society, you grow a welfare state, which then becomes unsustainable.
And we're really at the last weeks, months, years of
this experiment called the welfare state. And foreigners know this
because they've gone through the ringer all over the world,
and so that's why they're very leery of US debt.
(11:54):
They're leery of holding dollars. And so I think that's
why the price of gold is where it is, and
it's going to go a lot higher over the next
several years as central banks have been loading up on
gold to protect their financial situation, because gold is the
ultimate money. Gold is money, paper is what Fiat money
is not really money, it's it's just tokens that we
(12:17):
use now they're all mostly digital tokens. And that it
doesn't end well. Perry and those of us that have
been writing about this, speaking out about this for many,
many years. I realize that nothing changes in Washington except
who's president and who's in Congress. But the policies don't
(12:37):
seem to change. And that's why it's frustrating for someone
like me. Why isn't common sense being used to downsize
the federal government? I mean, Department of Education doesn't educate
a child. Teachers educate a child. So in our society,
we have the government taking over half of medical care
with Social Medicare and Medicaid and all the other programs.
(13:02):
We have the foodstamp programs which is now called SNAP,
the Supplemental Nutrition program. Parents are responsible for raising their kids,
not the federal government, not the state governments, not the
local governments, so we have a breakdown in the family.
We have a lot of children born out of wedlock,
so they don't have a stable family home, and unfortunately,
(13:22):
people rely on the federal government and other levels of
government to provide them with basic sustenance. And this is
why we need to really have a national dialogue about
what the federal government to do. And I think the
mistake that Trump is making he's not bringing in the
Democrats in these discussions. He's doing it strictly on a
party basis, and that's why the Democrats are voting in
(13:45):
a block against everything that Trump wants to do, instead
of saying, hey, we're all in this together, which everyone,
every politician says that. So let's sit down and have
a meeting of the minds about what's good for the
American people. That's what's good for our next election prospect.
Speaker 1 (14:01):
Okay, I understand all that.
Speaker 2 (14:02):
I guess the other thing coming back to the central
banks and the Feds.
Speaker 3 (14:08):
What do we do.
Speaker 2 (14:09):
They seem to be a powerful, unseen arm in this
whole equation.
Speaker 3 (14:14):
Well, this is why I think the Federal Reserve now
is between the rock and the heart place. I mean,
they've kept interest rates basically flat for quite a while
now because they think that well, they know that if
they keep if they lower interust rates, which means pumping
money into the banking system, it's going to ignite another
round of inflation. And by the way, the Federal Reserve,
(14:35):
although it hasn't lowered interst rates, it has been buying
government debt, which is essentially creating money out of thin air.
And so the Fed is doing this without making any announcements.
I think they just bought fifty billion dollars of the
federal government's debt. So they're easing monetary conditions by pumping
money into the banking system by buying all this debt.
(14:58):
And so we're going to see another round of inflation
probably next year. Right now, we're seeing the effects of
the higher interest rates that we had for several years
right now. But I think that'll turn around next year.
And then, of course, what happens in the midterm elections
in twenty twenty six. If inflation, which I think will happen,
will accelerate, and then Trump is going to be in
(15:21):
a very delicate position of saying, hey, I didn't cause
this inflation. The Fed did. But he wants to Fed
to lower interest rates right now, which will put gasoline
onto the fire, so to speak, of inflation. So again,
the Feds between a rock and a heart place, the
federal governments between a rock and heart place. And no
one in Washington except a few handful of people want
(15:43):
to say no to this out of control spending.
Speaker 1 (15:46):
What do you do?
Speaker 2 (15:51):
There's another element here that could be effective, and that
is the price of energy. We've talked about it, but
we really haven't lowered it signific it seems like the
East coast doing great. We on the West coast, we're
still looking at over four dollars a gallon, So something's
going on here.
Speaker 3 (16:09):
Yeah, I think that this is a local phenomenon. So
I think people on the West Coast need to find
out what's going on with the dynamics of supply, because
if supply is down or there's just a lot of
taxes on energy on the West coast. Here in Florida,
prices have come down considerably and we're seeing the benefits
(16:29):
of sixty dollars gallon sixty dollars barrel oil. I mean,
why Trump announced an energy emergency when he came into office.
I mean, the price was well below one hundred dollars,
and so that's not an emergency. I mean, in real terms,
gasoline is relively inexpensive compared to where it was twenty
thirty years ago when we had four and five dollars gasoline.
(16:52):
Now we have three four dollar gasoline. In some places
it's well under three dollars. So again, energy is just
a reflection of supply and demand in the marketplace, including
the Fed's money printing. So again, the people on the
West Coast really need to do a deep dive and
why prices are staying well above the national average, and
(17:14):
it has to do with maybe refining capacity, UH regulations
that are making it difficult for the refiners to get
the product to the marketplace. So there are a whole
host of factors that can that can disrupt the supply chain.
Speaker 1 (17:25):
Okay, let me take a quick break.
Speaker 2 (17:27):
Check out the professor's website Murray Sabran s A B
R I N dot substack dot com, and you can
also check out his his his book, his personal autobiography, UH,
from Immigrant to Public Intellectual and American Story Beautiful World.
Be right back, all right, Welcome back, Professor Murray Sabran
(18:00):
back with us today. He's a professor emerituser at the
Ramapo College in New Jersey. Financed his couple of books,
but his personal story From Immigrant to Public intellectional I
think you'll find to be a very inspiring read. He
does have a website and that's Mary Saberant substack dot com.
Speaker 1 (18:18):
Professor.
Speaker 2 (18:19):
A couple of things that I just want to keep
it at the thirty thousand foot view.
Speaker 1 (18:22):
I don't and I want it. This sounds political.
Speaker 2 (18:24):
I don't mean it to be, but My observation is
the Dems don't want to cut anything.
Speaker 3 (18:29):
Absolutely, this is the problem. The Dems have been on
the road to bigger and bigger governments since FDR, actually
since Wilson, because Wilson and his administration, the we got
the Federal Reserve, the income tax was enacted just before
he took office in nineteen thirteen. He took office back
then in March of nineteen thirteen after being elected in
(18:51):
nineteen twelve. And Wilson, of course expanded the size of
government that maneuvered us into World War One when he
ran out a piece of platform in nineteen sixteen, and
then Roosevelt came in and did exactly what Hoover did.
That deepened the recession into a great depression, and Roosevelt
just continued that policy, so we had a depression for
a full decade. On precedent in American history. The Dems
(19:13):
want to take over everything. If you ask a Democrat
in private, what should the top tax rate be, they
probably would say ninety percent, like it was during World
War Two, which is an abomination. They think that socialism
is the answer that big government. We need big government
in healthcare, housing, welfare expenditures, I mean, they really believe
(19:35):
in the Marxist view of the world. They have a
Marxist view of the world. In fact, the irony is
that we have a Marxist tax code, the progressive income
taxes number two in the ten planks of the Communist Manifesto.
So it doesn't get more ironic than that. That the
United States for to get a Cold War against the
evil Marxist Soviet Union, and yet we have the same
(19:56):
tax code that Marx proposed in the mid nineteenth century.
Doesn't get more ironic than that. So but what Trump
needs to do is call out the Democrats and say,
tell us what you would do to streamline the federal government.
Because we know that the thirty six trillion dollar federal
deficit a debt is unsustainable and two trillion dollars two
(20:19):
trillion deficits are unsustainable. They of course want to raise
tax rates, which of course would undermine the economy. I
don't recall any time in American history where rates have
gone up and the economy has boomed. That's not the
way the world works. The way the world works is
that we need more investment in the capital sector, which
is produces the goods that we the people want, and
(20:43):
so in order to do that, you need less regulation,
less taxes on capital and Trump should call for the
immediate end of taxes on interest and dividends and capital gains.
That would be the biggest boost of the economy. Then tariffs,
And I just want to get back to the tariff issue.
Trump has this notion, as do a lot of his advisors,
that because the federal government raised money strictly through tariffs,
(21:07):
mainly through tariffs throughout the nineteenth century, and the economy
did extraordinary well during the nineteenth century from eighteen hundred
to nineteen hundred, therefore we should raise tariffs in order
to generate enough revenue for the federal government. Well, back then,
there was no social security, there was no Medicare, there
was no medicaid, there was no military industrial complex, there
(21:27):
was no massive interest in the federal debt. So that
comparing apples with oranges, that comparing the welfare warfare stay
today to the rev small government back in the nineteenth century.
And when you have a small government, you could use
the tariff to raise revenue. But the problem Parry was
the tariff was so high that middle income and low
(21:48):
income people were complaining about it, and the big trade
off was supposed to be the income tax was going
to raise revenue from the wealthy because ninety eight percent
of the American people from the first income tax, and
that the tariff would be reduced. Well, the Republican Party
was the high tariff party since Lincoln, and when Harding
was elected in nineteen twenty, we had the high income
(22:10):
taxes from World War One, and after they got in,
they raised the tariff rates back to where they were
before the income tax was enacted. So we got an
income tax and high tariffs. And despite that, the economy
boomed in the nineteen twenties because there was a lot
of investment in the new technology, which is radio and
(22:31):
automobile production went through the roof. So there was a
lot of good things happening. But the insidious thing was
happening was the Federal Reserve was pumping money in to
the economy and so prices were basically level flat when
they should have been going down, which is what the
benefits are to the American people when you have a
productive economy and prices go down, where the living standards
(22:53):
go up. And then of course we had prohibition as well,
which is another story. But the point is the nineteen
twenties is a great case study of total mismanagement by
the federal Reserve, even though the federal garment was kept
at a minimum.
Speaker 2 (23:06):
Okay, but there's some other things to consider here. It
appears now and I say this only from my observation
that everybody was shocked when the tariffs came out of
the table. Everybody was saying, what you're saying, that tariffs
don't work. Then we find out the tariff is a
tool to bring people to the table, an effective tool
to bring people to the table to at least maybe
(23:27):
get some balance to this trade. And he does go
over and he makes deals, and he brings one point
two trillion here and four hundred billion there and two
hundred million there, and he's got China basically on its
knees in some way. Whether the term tariff as you
describe it, and everybody pretty much agrees that it doesn't work.
(23:49):
In the long run, it's become one of the most
effective tools we've ever seen to help bring some things
back into line.
Speaker 3 (23:57):
Well, let me start with a few things. Balance trade
is a misconception we don't have as individuals. We don't
have balance trade with all the vendors, the stores that
we buy. We use Amazon, we shop at local supermarkets,
several local supermarkets. I don't have balance trade with them.
I buy from them because we have generate income and
(24:18):
retirement and they provide us with goods that we want.
So we don't have balance trade on an individual basis.
So why do we think that we need to have
balance trade? Quote between nations? Nations don't trade. Individuals and
businesses trade. That's the difference between the Trump and his
advisor's outlook on trade and my micro aspects of trade.
(24:38):
Trade is done between individual businesses and individual human beings.
They're not done by nations. Nations don't trade. Nations are
basically geographic political entities. So put that aside for a second.
The tool that I would use to boost the economy
would be getting rid of taxes on interest, dividends, and
(25:00):
capital gains. I agree with that, getting rid of the
corporate income tax, which which would make the United States
the freest economy in the world, where businesses would flock
here because if they didn't have to pay taxes on
their income, they would get a huge bonanza by locating
in the United States, and that would mean the creation
of millions of jobs here without the blunt tool of tariffs.
(25:23):
Tariffs sound good in principle in terms of trying to
get other countries to reciprocate. But the point I would
make is that all trade is fair white perry because
both parties have to agree to the transaction. That's the
notion of freedom and liberty and voluntary exchange. Both parties
(25:43):
have to agree in order to trade to take place.
And so if we really want to have a more
harmonious trading world, we just reduce our barriers. We could
do that unilaterally, and that would show the world that
the United States is serious about economic freedom.
Speaker 1 (26:00):
Okay, you make some very good points here. I have
to agree.
Speaker 2 (26:03):
I don't know why we're going to run out of
time here, but I don't know why the President hasn't
gone off the corporate rate. I mean, he talked about it,
but it's not being done. If there's anything that would
give this thing a supercharge, it.
Speaker 1 (26:14):
Would be that.
Speaker 3 (26:16):
There's no question about it. I mean, every time the
corporate rate goes down and the economy sense tends to
do better. I mean, why do I play a mind game?
Speaker 1 (26:24):
Why do you think he hasn't addressed that.
Speaker 3 (26:26):
I think for political reasons. I think he doesn't want
to be accused by the Democrats of giving supporting the wealthy. Well,
if you have capital perry, you create businesses. I mean,
that's why the Well Street Journal had a great article
the other day, which I posted on my substack, is
that small businesses are thriving because they find a niche
(26:47):
in the marketplace and they run with it. And there's
a profile of several businesses that started literally with nothing
but an idea and they're booming, like weather Tech is
doing eight hundred million dollars revenue when they were doing
nothing thirty years ago. Think of Amazon, Apple, Microsoft, Dell,
all these big companies that have gotten from an idea
(27:10):
in someone's living room or basement to a multi billion
dollar enterprise. And that's the way a free market economy works.
And Trump should get out there and say that we
are a nation of entrepreneurs, we're a nation of small businesses,
and we want to have the least burden on our
small businesses and other business as well. And come to America.
You'll pay very little taxes, if any at all, and
(27:31):
you could set up shop here, and we're going to
not bother you in terms of what you do, as
long as you've done peacefully and respect the environment and
so on and so forth.
Speaker 2 (27:39):
All right, go to Murraysabran dot substack dot com and
get one of his hats T shirts Make America Financially Independent, professor.
Thank you for your time. You're fascinating. Let's stay in
touch as all this kind of unwines. We got a
lot to look at, and we're only in this thing
six months.
Speaker 3 (28:00):
Well, the thing is, we have another three and a
half years and I just will continue to write about
the good, the bad, and the ugly in Washington.
Speaker 2 (28:07):
You're the man. Thank you, Frand good to see you.
Thanks for your time.
Speaker 3 (28:10):
Thank you, Perry. Great to be with you.
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