Trump Economic Advisor: Here Comes The Boom! | Art Laffer

0:00 I feel as euphoric today as I did when Reagan took office in the 1980s I am expecting very much the same type of world to occur here you're going to have fun it is so much fun being in a bow Market I just got to tell you just sit back have your nice old oldfashioned with Makers Mark Bourbon and you sit back and enjoy the living hell out of this period I am thinking markets are going to be very very good for the next six8 10 years [Music] welcome to thoughtful money I'm its founder and your host Adam tager well America has a new president- elect with a very different economic plan than the departing administrations what new

0:45 policies should we expect when Donald Trump returns to the White House and what ramifications should we expect for the US economy and the financial markets well I can think of few better people to hear from on this topic than today's guest who's one of the key economic advisers to president-elect Trump today we're fortunate to welcome back to the program Economist Dr Arthur laugher he was the first to hold the title of Chief Economist at the Office of Management and budget in the early 1970s he then served as a member of President Reagan's Economic Policy Advisory Board he's perhaps best known for developing the laugher curve a model for determining the optimal balance between tax revenues and economic growth Dr laugher thank you so much for joining us today my pleasure Adam than thank you very much all right

1:31 well look uh I can think of few people as I said uh to have this discussion with about what to expect from the incoming president-elect's uh economic plan um let me um let me start by saying U well first off real real quick what has been your level of involvement in the development of the the Trump uh economic agenda so far I have no idea what my involvement is in developing the agenda but I have been in conversations with him and a lot of people around him uh throughout the whole period of the last four years and uh exceptionally intensively in the last six months uh so I am involved with those people and uh I don't know whether he listens or not what is what the inut what impact they've had or not but uh I'm very

2:17 pleased with what's happened and I'm very pleased with what he's proposing I I I I'm I I'm going to tell you that I was very depressed in the late 1970s 7879 80 and just on the ground sobbing and weeping and then all of a sudden bang we had Ronald Reagan and the world took and I've never had a bigger shift in my life than from the late 70s to the 80s under Reagan it was the I was euphoric under Reagan I have the same set of feelings here I've been exceptionally depressed under the last two or three years of Joe Biden uh and kamla Harris and then all of a sudden the election results I was down at maral Lago that night uh I was at the Maraga when the when the boats

3:03 were counted it was wonderful uh and uh I can't tell you how happy I am with where we are today I feel as euphoric today as I did when Reagan took office in the 1980s I I'm just over the moon and I think this is going to be one of the best periods in US history ever okay great well look um good enough for you that that that that's a great way to kick this off and you know on the Channel I sometimes have been painted with the brush of being too bearish uh get some more Bulls on there um it's great to have somebody coming on who's got a lot of optimism where things are headed here um I should note too uh Dr laugher that you have been an advisor to presidents for decades uh on both sides of the aisle so I don't think you

3:50 consider yourself necessarily died in the wool on one side or the other you're just trying to help America achieve better economic Prosperity I also remember our previous discussions um you know you talked about the the rapidity of the transformation of the economy during the Reagan Administration and have said and I want to weave this into today's discussion that hey if we adopt the right policies you feel that we can have a transformation that could be as Swift again um is that true very very true that's totally true in fact maybe even swifter okay maybe even swifter okay so let's let's let's roll up our sleeves and get into the heart of it here and I've got some questions that I think most of the audience probably shares and I can't wait to walk through them with you but let's start with what is your

4:36 current assessment of the new Trump administration's economic plan as best we know it um I was going to ask if you were optimistic you've already answered that question for me you did recently state that quote Trump could boost the economy uh far more than President Reagan so what is it about the plan specifically that's got you so excited well as far as first-term presidents go I I believe that Donald Trump was the single best first-term president in US history on economics now remember I'm only talking about economics I mean the the Supreme Court decision the Chevron decision to not allow uh government agencies to make law I think that's wonderful I think operation warp speed was unbelievably cool I thought the tax cuts and jobs Act was amazing I thought his energy policy was great I could go

5:22 on and on and on but I thought he was the best single first-term president in US history coming into the situation now uh I look at what he's proposing and what he's talking about and I'll go through the areas with you and again remember this is just Adam it's just economics and and that's all I talk about uh the first area is taxation the Northstar is a low rate broad-based flat tax that's the ideal tax system Biden moved us away from that he was trying to raise tax rates on the rich trying to give welfare to the poor all of that stuff which is just anti-growth all the way uh Trump has proposed all sorts of ways of moving us towards the flat tax effect there was even one conversation he had

6:08 where he talked about eliminating the income tax uh I think that's a huge plus number two government spending all you have to do is look at Elon Musk and VI ramaswami to understand that he really is focusing on government spending uh now during the first term he did all that spending after covid-19 which probably should not have been done but he did it uh this time I think he's going to undo it and I think you're going to see while Biden was the biggest spender and wasteful spender of all time I think Donald Trump is going to really hone in on government spending above and beyond what's necessary and bringing down that spending dramatically and government spending as you know is is taxation I mean you know government spendings you have to take from someone to give to someone else and the that's

6:53 the transfer theorem which we went through last time together and the transfer theorem is government spending the economy and I think Trump's going to be spectacular on that the one area where we maybe want to come back to is monetary policy uh I think Powell is doing a very bad job on monetary policy the anti vulker if you will uh I think that is an area that needs a lot of focus and I'm not sure whether this Administration is going to give it the right Focus or not I'm hopeful it will but I'm going to pass that by on regulations I think this Administration the Northstar is light regulations minimal regulations and uh Biden was very heavy-handed very heavy regulations closing the XL Pipeline all of that nonsense which makes no sense whatsoever

7:40 uh and uh I think but Donald Trump would be probably the best president ever on regulations I I'm very excited about that and lastly uh free trade and this is the elephant in the living room and I'm going to tell you and I think I said this with you the last time we were together Adam uh is that Donald Trump uses trade as a negotiation tool to bring people to the table to negotiate free trade deals he does not believe in high tariffs and high quotas and high non-tariff barriers unless the other side is absolutely unwilling uh to use reciprocity uh and then he's willing to threaten them with access to the US markets to bring them to the negotiation table to reduce tariffs quotas and trade

8:26 barriers you saw that with the us MCA you saw it with the Japan us trade deal you saw it with the US South America South Korea deal you saw it with the Brazil deal you saw it with Ecuador you've seen it all over the place that he is a free Trader but he wants those countries to reduce their barriers against us just as much as he wants to not increase barriers against them and he is willing to threaten them and bring them to the negotiation table classic is John Deere you know John Deere is going to move to Mexico produce all their goods down there and then ship them in here no you're not come to me let's talk about what we can do to keep you here in the US to make it worthwhile that's the type of guy Donald Trump is so I am very hopeful that he will be a very major

9:13 promoter of free trade in the world like he was in his first term there I go there you go you got okay and I was I was gonna ask you about tariffs because I remember from our previous conversations you are not a fan of them but what I hear you saying here is and a and a Trump himself says this is really the Tariff is the big stick it's the thing that he is saying look I don't want to use it I will right and it's hopefully the threat of the Tariff is what leads to the negotiation of a mutually uh beneficial deal yeah I did a show called Vice uh in 2019 or something like 2018 that did it right after my conversation with the president back then where he talked to me about how he is a free Trader and I went through that all then so this is not a new story of mine that I'm making up for political reasons uh this is what he told me it

10:00 made perfect sense then and then he followed through on it exactly as he said he would uh and I'm very hopeful and believe that he will do it again and make this a much Freer trade World okay um I have a I've got a follow on question to to that um as well as the rest of your list um before I do real quick you you've just listed a whole bunch of things you're very excited about with maybe the question mark being monetary policy yes it is the question um but uh is is there anything that you know right now about the economic agenda at least as stated right that you would change or that worries you at all not really I mean you know when he did all the tax stuff he did the tips why would you ever spend a lot of money collecting less money uh in taxes does make sense

10:47 uh I think what he said about overtime work being lower tax rates or non- tax I think that's just brilliant uh I think what he said about deducting interest on uh auto loans is correct if you're going to charge if you're going to be taxed on interest income You' got to also deduct interest expense that's why homeowners uh mortgage uh interest should be deductible and lastly Americans working in foreign places should not be put at a huge disadvantage to foreigners uh so therefore the US tax should not be added on to their taxes uh to make them the least efficient people in let's say Hong Kong or wherever they're working I think all that makes perfect sense and you know he's just right in there and even mentioned that maybe we're going to try to get rid of the income tax and you know that would really rocket this ship

11:34 to the moon so I I'm very pleased with their agenda so that's um hard for me to get to my next question without stopping here on that part for a second so um two questions on on these big tax ideas one um what is the level of um feasibility of you know President coming in being able to make these changes um because I don't think it can be done by executive order I'm sure's got to bring everybody along with him and I think a natural question folks would say is okay well uh that takes away a lot of Revenue uh from the government um uh what are the implications of that right and I I I know that the free marketers would say well that's more money for more people to spend they're keeping it they not

12:20 that's not where I am I'm in incentives and a tax rate is an incentive it's a wedge between what uh what you get paid and what you get to keep uh and that wedge drives or makes it makes employers not want to hire you and it makes you not want to work when you raise taxes when you lower you make it more attractive for both employers and employees and it has nothing to do with putting more money in your pockets or any of that junk it's just the marginal rates of uh of of incentives there are really improved for both employers and employees all right that's where I come about on taxes uh when I look at the uh uh situation here uh with regard to the US these taxes uh I did Jerry Brown's flat tax when he ran for president in 1992 I think he was one of the greatest candidates of all

13:06 time uh what he wanted to do was get rid of all federal Taxation and in their stad have two flat rate taxes one a business net sales which is a value added tax and one on personal unadjusted gross incomes on the first dollar to the last dollar so there's no deductions admissions to credits any of that stuff it's just flat tax on both of those we could have replaced all federal taxation all of it with two flat taxes on business net sales and personal unadjusted gross income we could have done it with a tax of 11.8% or 12% I rounded it up to Jerry rounded it up to 133% that is the direction you want to go uh you want to look at what Reagan did in the 86 Tax

13:53 Act we took 11 tax brackets and turned it into two uh we lowered the top rate from 70% to 28% we raised the lowest rate from 12 1/2 to 15% we went from 11 half is 11 brackets to two and we eliminated all the deductions exemptions and exclusions in there equaling so it was Revenue neutral I mean this thing we cut the corporate rate from uh 46% to 34% under Reagan that is the dream that's where we should go that's what Jerry Brown did if if B Donald Trump moves in that direction I would just scream and holler I'd stand on my head and spit wooden nickels you would see the greatest economy for a thousand years it would be the greatest period of US History

14:38 ever okay so to make that happen what needs to happen is that something that requires okay so so Congress has to come along on this one yeah and plus you know we've got 53 senators and there are a lot of Democrats who would love to vote with us let let me just tell you that they know the Biden Harris agenda was crap they do know that uh they went along with that for politics but if you make the bills so you incorporate them in it and you get rid of the deductions exemptions and exclusions so it's not a huge Revenue loser static I think you can bring a lot of Democrats like we did in the 86 Tax Act if you'll remember in the 86 Tax Act we got the vote was in the Senate 97-3 all right only three Democrats voted against our bill we could do that again here we also have control of the

15:25 house which is also very advantageous for this one in fact if you look at the government in in its grandiosity there of the seven positions of political power this Administration has six of them it has the presidency it has the most exclusive club in the world the Senate it has the people's house the House of Representatives it's got the Supreme Court and I don't mean on social issues I mean on economics I mean they've got big time uh it does not have the Fred fed but does have control of most Governors and it has the control of most legislator as well so of the seven positions of political power there are six that are in the C Trump camp and

16:11 even the Republicans now are better Republicans than they were prior to Trump's coming into office the first time I mean we don't have the Romney we don't have the Jeff flakes we don't have some of these others who were really hostile to Trump these guys want to play ball and get it done so I think there's a very good chance that if he wanted to do something given the role of the seven positions of political power he could actually do it do it and he would get the FED in a year right yeah may not not really the fed's the Republicans on the fed and the Democrats in the FED are no better uh the FED is a very intricate thing that they don't understand we need to get vulker back uh and there are very few people today who think like vulker we do not need the FED setting interest

16:57 rates we need the Fed setting the B the balance sheet that's what we need to do set the balance sheet and let interest rates be what they will be but contract the balance sheet to bring down inflation over the long run expand the balance sheet to increase inflation over the long run that's the way we need to run it and these guys don't know straight up from sium uh you know Powell asks his staff what should I do vulker told his staff what he was going to do to do well that's my point right so P Powell's tenure is up I think in March I think or so of 2026 and that and that position is appointed by the president um I got to say in and you know I've seen names like you know Hawks like Kevin warsh uh floated for the next fed chare but I got to say I've seen art

17:43 laugher name floated as well so if if an art laugher were put in there could he could he command the FED to what's needed to be done yeah to get rid of one silly question that's one I'm 84 my 85th year no one's appointed to a job then and number two I have never taken a job in government because I don't ever want to be compromised by being an employee and having the oath of loyalty there I was in the White House from 1970 to 72 under George Schultz that's true and I found out what I don't do well I do not work well in bureaucracies or governments uh I'm I keep my confidences with presidents I work closely with Reagan I never was disloyal to Reagan but I never shaved an answer with Reagan because I was trying to appease him or make political favors

18:30 right you look at these other people Adam and and and you see them they will rebut arguments they know to be true in order to Curry favors with their political benefactors I never want to be in that position and I never will be and I never have been except for the 1970 to 72 period when I didn't know better but you know looking at let let let's say uh Janet Yellen or some of these others you know they know better than what they're saying but they're doing it to be a team player I don't like being a team player not that I'm going to betray my team my my team by privacies and what goes on but I don't want to ever hedge my bets and not say what I believe to be correct because I'm a team player I'll just keep

19:17 my mouth shut and so there's no chance of me ever going into government but thank you very much for the nice little rumor but that's not going to happen Okay well and just to be clear not my rumor it's one I actually read this morning in preparation for this this conversation but but but to the spirit of the question um you said that that currently um the Administration has six out of the seven kind of keys to power they sure do it could get a seventh if it appointed an art laugher like head of I think Kevin Walsh would be great I I think there are plenty of others that are really good out there but it's a whole fed board too that's not on track you get to drag them along you have to oh my God it's you know it's like pulling teeth to get people to understand how money works because they don't have a clue you need to control

20:04 the monetary base and create economic growth and you'll bring down inflation you'll bring down interest rates and you'll create prosperity for a thousand years but you know these people don't understand that okay well you know we will be watching this obviously very closely over the next year to see who replaces pal but um to your point about your excitement and your um experience uh and your academic expertise around taxes because that's your thing right I mean at the core you're you're Mr tax policy guy well I start off in life as a trade Economist you know I my dissertation's all on trade my textbooks on pure trade Theory and on balance of payment stuff so all of my early years was on trade which is the most rigorous area of Economics okay but you love taxes I mean you think tax key right yes I do so here's here's my question we have a Bor

20:50 are now we have uh government efficiencies are should we have a tax are if they're really going to try to do this should they have a guy who's just this is his job he's making sure it gets happened it sounds like you would you would think from what I hear from you they should prioritize this early because who knows what's going to happen in the midterm election so while you've got all these Keys lined up like run with it should should should Trump consider pointing a tax reforms are I thought he had and and be and Bess I mean keev he's he's just great and uh he's Secretary of the Treasury which is totally in control of taxes okay so that's the right appointment for the right Department you think I think it's the right appointment for the right Department obviously expost Factor we'll see but yeah I I mean I know him he came out here 5 weeks ago spent the full day with me uh he's a fellow y uh he's a a

21:39 hedge fund guy he knows markets well uh you know I couldn't be happier with the Secretary of the Treasury than I am with Scott Besson I just couldn't be happier he is the guy who needs to be focused on taxes okay so um you you anticipated some of my other questions I was going to ask about what you thought about his nomination so far especially treasury sounds like you give a great big thumbs up how about letnik at Commerce I don't know letnik at all uh other people say he's really good I don't know him uh you know obviously Trump's people think he's good because otherwise he wouldn't have been appointed uh but I do know the firm that he worked for Apollo uh I knew that really well Apollo is a great firm and uh all I hear is good but I do not know him and I and I don't wish to make a statement about it uh I think Commerce

22:26 is an important department but not nearly what treasury is not what state is and not what defense is okay um I also was going to ask you about Fed chair but we already went there which is great I love it when my my interviewees anticipate my questions so okay here's the big question I've been trying to build up to um you are very optimistic about where this could go and giving you confidence in that optimism is what you went through during the Reagan Administration um a lot of what is being proposed here is disruptive right um yes so so here's my question so let's assume for a moment let ask you let me ask you a question before you do is stopping smoking disruptive no and this is a great analogy for my question thank you okay um so just like with

23:14 stopping smoking right the best thing to do is just to stop doing it stop right I did it okay you did but for most people who are heavily addicted to nicotine there's a rough patch right there's a withdrawal period go for and so my question is is let's give Trump the benefit of the doubt let's say he is successful four years from now he can claim victory on all these things right yes is it going to require a period of short-term economic pain to get out to the other side especially given what I imagine you would say the hole that we have currently dug for ourselves yeah there there will be some people will be in pain that's true I don't think there's going to be aggregate economic pain I don't think we need to go through recession or depression or any of that stuff I think

24:01 the reason that happened with Reagan was very different than today and I think Trump will miss the mistake that Reagan made in 1981 Reagan cut tax rates as you know by 25% across the board all right but he phased those tax cuts in if you know they're going to cut tax rates next year what do you do this year you defer all the income you can rean year exactly yes Reagan caused the 81 82 recession deep deep deep recession because he phased in the tax cuts the the tax cuts began literally on January 1st 1983 bang the economy took off from January 1st 1983 to June 30th 1984 that's 18 months that's a year and

24:47 a half that's six quarters us real GDP grew by 12% 12% Adam I mean 12% you know you had uh uh you had average annual growth rates of 8% for a year and a half which is just unbelievable I think Trump can get that type of thing through if he doesn't make some very simple mistakes which I do not expect him to make he knows what happens with incentives when you phase things in uh if youve got fat bureaucrats that are not producing things that are holding things back and you terminate them and let them get good jobs out in the private Market I don't see how that's going to cause pain now that guy's is not going to like changing jobs mhm but the country is going to be

25:32 a lot better off because he changed can you imagine all those ta tax accountants actually doing something productive how wonderful would that be now would those tax accountants vote for this bill no of course they wouldn't but they're wrong and it's going to make America a lot better right away they quit doing damage and they start doing good how can that be bad for the country so it it's in my premise here is I'm not saying it's good or bad I can get on your bandwagon and say I think if a lot of this stuff gets done it's going to be really good for economic growth you know sustainable long-term economic growth um the question I have is if if doge is successful at drastically reducing the the size of of uh government and and you they're they're talking about you know Mass yeah

26:18 mass deportations of bureaucrats right so lots of big job Cuts you know those folks will hopefully get employed although people will argue are they are they actually employable in other parts of the economy who knows we'll find out but that's not going to they're not going to get fired on day one and get rehired somewhere in day two if he's successful in deporting you know millions of undocumented uh people that are currently working in the system you know many under the table but in construction and other key parts of the economy if we go through the Tariff I'm going to call them tariff Wars right um but presumably you know there will be certain deals certain countries that don't roll over on day one and may require a short-term implementation of a tariff or just other saber battling right economically um all that stuff you're much better to assess this

27:04 than myself but I don't see that as all happen magic happening magically you know very quickly where you could well be right on that I mean you know there some of these things may have negative outcomes because it takes while for this to happen and that to happen but all the ones you've talked about so far I I would look at it in a slightly different way and I am no better at judging what's going to happen than you are a please I know my ignorance and my ignorance is astoundingly large uh and what you're postulating here does make a lot of sense I I agree with you uh I I look at it at the other side of the Ledger I say that if these guys let's say get a a six-month bonus from government uh so they they aren't going to be hard pressed for six months they can go out and find a job do a Cree I think that's

27:51 really positive I think the people who are going to be deported are going to be the people who are hurting America most are going the criminals the scoff the bad guys the do all all of these people the Tren alaga or whatever the heck these groups are so they're going to get the bad ones out first and then I think you're going to see a very different attitude towards the good ones who are working hard supporting their families I don't know how that's going to finally end up but I I am much more optimistic about the mass deportations that the bad ones will be gone and some of the good ones may remain I'm much more optimistic than you are uh with regard to the government workers I'm also more optimistic than you are that these guys will stop doing harm and will start doing good things Milton fredman used to say that the best thing you could do in America is destroy all the highways from

28:37 the suburbs to downtown Washington DC just don't let them come into the office pay them do anything you want and the Damage they do will be stopped and will be huge Improvement he was joking but there's an element of Truth in what he says sure and we just saw this I think in Canada I think they had a like a couple week shutdown to the government there and like literally nothing changed I know but Canada is a perfect example of what not to do yeah so so here's where I'm going with this question because I don't know the answer to this too but I I have a I have a hard time seeing the patient not go through withdraw symptoms at least you in the near term and so my question is is um and also too we haven't really talked about this but if if they're really reducing um deficit spending and

29:23 um there's a there's there have been a lot of artificial liquidity pumped into the system both monetary side but especially on the fiscal side of late that's been supporting the economy it's also been supporting the financial markets again I just have a hard time saying can we turn off those spigots you know with Vigor without seeing some real repercussions and so I would think if I were advising the Trump Administration I would say maybe get out in front of this and communicate now to people almost sort of a wartime message which is we're going to get to a much better place but we you know we inherited an economy that's got a lot of issues going on we've got to do our radical surgery to help the patient you know get better here but we're going to have a period of sort of shared National sacrifice where things are just going to get bumpy and we're going to need to shoulder this together to get the country to a better place see let let let me ask you the

30:09 question you say bumpy but you know the guy who's going to be on on life support or uh no longer uh supported the guy who's addicted to the nicotine is not the American people you're not addicted to your taxes if someone said you're going to have to pay half the taxes you PID before are you going to go oh my God no don't do it please help me no it's the government that's going to be weaned off nicotine not the country now the country I think is going to be benefited immediately uh I think the government's going to find out it's got programs and stuff that going to have a hard time shutting down and the bureaucrats are going to have a hard time finding these jobs as you said all of that's true but the country as a whole will be thankful that their um that their mom stop smoking okay I think you and I are going

30:56 to be really happy that Mom's going on withdrawal and she's not going to die of cancer next year okay and that's that's maybe the core of my point which is and again I don't have the answer I'm trying to see if if you have a better me too I don't have the answer either but what matters is what the regular person feels right I mean I think that's what what determined the election was people walked in and they voted really their pocketbook you know I'm not feeling better off than I was four years ago I'm more worried about the future economically let me ask you that question let me just ask you that question do you think people are really worried about the consequences of not paying as much in taxes oh not at all but I guess my question to you is is um is there a danger if we if we do have some rough you know initial with effect from this tell me tell me the source of the roughness

31:41 that's what I here are people who are on welfare right now or who is living on government programs they are not going to get those government programs right now that won't happen in two days it'll happen six months let's say whatever the time period is but they won't have them does that hurt America I mean that's I'm asking you that question I don't see how getting someone off welfare and into a job hurts our country I don't see how that does it I don't see how stopping inflation causes America to be damaged even in the short run I really don't yeah I totally agree with you on the last the latter one the second one obviously the people who have become dependent upon those those welfare programs will see the transition as not correct but the people who are paying those bills won't those people

32:27 your tax are going to go down dramatically so okay yeah and if your taxes go down dramatically very early on I think that's great the question I was sort of asking is is you know could there be enough economic pain in the short term that when the midterms come up people are dissatisfied and all of a sudden they lose the house right and I think it goes I think it goes the other way the longer you wait and the longer you phase in the more guaranteed you're going to lose the house that's why I use the Ragan example of the phasing in of the tax cuts so you're just rip the bandaid off day one just go you say to rip the Bandit off you know you give the guy in the desert some water okay yeah that's not ripping the Bandit see the analogies you're using are all these pain analogies and all these curing of and oh my God your arm's Gonna Hurt Like

33:12 no it's not when you get off your camel and you haven't had water for three days and you see a glass of water no no no you're only going to have a drop first then two drops then no drink the whole damn glass of water and be back to normal and I think people are going to find exceptionally good to have the burden of welfare payments and all of this stuff because we have economic growth the the best form of welfare is still a good high-paying job and to create this I mean when I said to you about what happened to GDP growth from January 1st 83 to June 30th 84 that 12% growth was the most greatest Elixir this country has ever had there was no downside to that it was spectacular the poor got jobs the unemployed in instead

33:57 of getting welfare they got paychecks what could be better than that okay running a system on welfare for four years five years six years now God it's awful ever since covid-19 it's time we got over it we got over ourselves and provided them with good high for the poor the minorities the disenfranchised all of these groups are going to be better off and that's why I think Trump did much better with these groups in the election than did Biden or Harris I mean I mean you know the reason is that they understand that there is no path to their success except through hard work and growth and doing it on their own and I think we all feel that way and we all are just ecstatic about what's happening okay and all those outcomes I've got to

34:43 imagine most people watching here you know are probably standing up in their chairs and applauding you Dr L I don't mean to do that either I love it it I love it yeah um all right so and this is this is great U because you know I think I think the the list of concerns that I had you know um I share and or have had and and I I know I know viewers understand what you said all the way um and again it's not a resistance to the end outcome it's just understand that too um just the way your questions were almost everyone I talk to feels the way your questions were you just said it very articulately and I was able to respond but there there's one other area that I think is really important here let's go there war okay yep war and presumably ending Wars correct you better believe it there

35:30 are you know there's nothing that brings down the the endorphins and all that than watching people get bloodily murdered over in Ukraine or in Gaza or in the hoodie rebels of all that and you know peace through strength is the key we need a very strong defense department and we need an open free market economy to here's your deal if you want to share with us in the creation of prosperity while trading with us and using us and all that wonderful you're welcome to our table playing by the way if you don't and you're going to go the other way we got the best defense department in the world and Reagan did it uh we had no Wars under Reagan we had no Wars under Trump's first term John F Kennedy was the greatest president on this that when he said the best form of defense spending is always wasted whenever you

36:16 find yourself in a situation where you are required to use your military hardware and prowess that is a clear sign you did not spend enough we should not be in Ukraine we should have stopped it before it started and Biden wasn't able to do that because he was weak uh we had a problem in Gaza that I honestly believe the Gaza attack would not have occurred had Trump been the president and did occur because of the weakness of Biden Harris there that's me uh but you can see the first term under Trump there was no war bang he goes off bang we have War immediately with Biden and now they want to escalate it what is the end game for these warhawks what is the end endgame for the neocons you know okay flex your muscles what are

37:03 you going to do you want to really prod that bear is that what you or you want to sit down with with Putin and say look at guy we none of us want to go this route all the way I mean where we're nuking Moscow and you're nuking somewhere else that's not as as as U uh Linda ronet said no one likes nuclear war uh I think the the the manifestations of prosperity and strong defense will be peace and peace is the greatest Elixir for happiness you've ever seen okay and uh so presumably uh if if if Trump is able to come in continue his record of not starting new Wars and Achieve hopefully ends to the current big gotta get you got to get a

37:48 Ukraine settled you've got to get it settled but it sounds like you expect that aside for a moment you expect a lot of domestic benefits from all the policies we've talked about then you a peace dividend on top of that that's sir that's exactly it it's a two-pronged attack huge Prosperity which makes everyone in the world better off and peace which makes everyone in the world better off that that that double pronged Fork there is the key to world peace and happiness and prosperity and I'm really excited about it as an 84 year old okay well that's that's great to it is great to see so let me ask you this and you're probably going to be postulating here I don't pretend that you're necessarily an expert on this but you definitely have more context than I do in terms of you know what's been driving the bus to date um that's gotten us to the point we're

38:34 at right now um is it a is it a world view do you think that is driving um the current G us geopolitical strategy or is it more just the military-industrial complex in the driver seat that is just you know lining so many pockets that everybody's going along with it I understand the latter but I think it's the former that is correct here there have been two views in the world here uh the one view is Keynesian or what I call redistributionist and then there's the other view which I call growth or supply side economics and these two views have been battling politically from time and Memorial they really have uh for example to aian uh people work because they're jobs uh to us the supply cers people don't work because they're jobs they

39:20 work to get paid after tax uh to aian people save uh because their incomes are high to us Supply C people save to augment their wealth uh and make an after tax rate of return uh to a Keynesian if the government's running short of revenues it's got to raise tax rates uh to do that to us that's a double-edged sword sometimes when you raise rates you do get more revenues but sometimes you also get less it's a different view to us the primary role of the state of government is to create a political economy of growth to create Prosperity output employment production to bring the people the poor up to the redistributionist they believe the problem is equally as bad on the wealth their job is to take from those who have

40:06 a little bit more and give to those who have a little bit less thereby the more have a lot of it anyway but the poor need the money they view themselves as redistributing a given amount of income and us we view it as a very different world and that those are the two World Views and they've been at Battle here and in every other country for a thousand years and this is our turn to shine we are the growest we are the peaceful people we are the people that really want to create a bigger pie rather than trying to redistribute a shrinking pie and it's totally that it's in academics all the way I mean I'm Yale undergraduate Stanford PhD all of that and I know my colleagues well and they are all redistributionist all of them want to redistribute take from

40:52 production make cleaner air you know my view on on on on global warming is just tax carbon and you'll get people that's it and use the revenues to lower income taxes you don't have to have depression contraction and slow to clean air you can do it really easily with a carbon tax and use that carbon tax to cut income tax rates by an equal amount and God bless you you'll have a great economy and clean air in addition to a great economy and these guys don't see it that way and might they're all my friends I mean I went to graduate school with all of them I got better grades than they did and uh you know uh but they don't see the growth model they just don't see Adam Smith uh they don't see David Ricardo they don't see growth economics they see it as the Dismal science and they go home and the rich

41:39 people are taking all the money we could give to the poor no the rich people are the people who hire the poor the rich people are the ones who give the poor a chance to become rich tax codes are guaranteed way of Never Letting a poor person ever become rich because the only way you can make it through a tax Cod is by having a lawyer an accountant a deferred income specialist paper grab or lobbyist it is the guaranteed way of making damn sure the club never allows a new member I want to get a low rate broad-based flat tax so poor people can become rich and join the club we need to crash this party and get prosperity and you see the difference in the two views and I have not been winning for a while but no is my turn all right so uh this has been

42:26 fantastic Dr laugher I've got uh two questions for you as we begin the lay on the plane here um and I'm trying to think of the the the way to order them I guess I'll start with this one so um you're very optimistic about where things are headed from here now is our time now's the time that you've been advocating for uh it sounds like you think the economic benefits are going to be pretty immediate right you we may have some short-term transition but you think you're gonna makes a big mistake they will be immediate okay stock market showing us that right now okay so should immediate and if it is you think we'll see the benefits immediate immediately um okay that's the economy I don't know if you have an opinion based on where you sit of the markets markets have been they're they're quite richly valued although if we Turbo Charge the economy

43:11 all of a sudden you know earnings can rev back up and maybe justify these large valuation multiples we have here um what are your general thoughts on the markets let me go back in history a little bit with you in February of 1966 at the end of the Kennedy era from February 66 to uh to August 13th 1982 how many that is that 16 and a half years mhm uh the stock market the Dow went from 1,000 its intraday high in February 66 to 777 in August 13th 1982 that's a decline of about uh 22 and half% something like that over 16 and a half years over 16 that's a bare Market that's in 22 uh there but that's not all

43:58 during that period from February 66 to August 13th 1982 the price level trebled not only did the price level trouble but that meant that the real value of the stock market went from a th000 in February 66 to 235 in August of 1982 that's a decline of 76.5% in real terms that is a bare Market the market dropped at an average annual compound rate of 7% perom Adam 7% perom for 16 and a half years ouch then what happened then God sha his face upon us and the world went Bo I am expecting

44:44 very much the same type of world to occur here you're going to have fun it is so much fun being in a bull market I just gotta tell you just sit back have your nice old oldfashioned with Makers Mark bourbon and you sit back and enjoy the living hell out of this period I am thinking markets are going to be very very good for the next 68 10 years I mean it's going to be a Reagan Era just look at what happened to those markets it just goes under Reagan under Kennedy did you see what happened when Kennedy took off when you got to uh what was it July 1st uh uh 1962 when he reaffirmed dollar convertibility proposed the tax rate cuts it was the go- go 60s a sharp rise

45:29 in the market we're in for one of those periods as well now I don't mean to overwhelm you with my optimism but I've been depressed for a bunch of years now it's my turn to be happy and you're happy right along with me believe me you are all right well look from your lips to the universe's ears um I I I really want to drink this Elixir part of my brain is rebelling on wait just see yeah well let me just quickly note this and let you you know put a dagger in it if you want but you know we we've had a prolonged Bull Run in the market yeah it's been punctuated by the GFC and by Co very briefly but I mean stocks have done phenomenally well right I mean they were 666 uh in the bottom of 2009 we're now probably going to hit

46:16 6,666 before too long um the buffet ratio which is basically a PE for the the whole market and economy is the highest that's ever been so it it it just makes me think really like we're at these very high level of evaluation extremes we can have another glorious six to eight years on top of this but it seems like you think so well you know the the the indices that you use are are and I know these you know I was University Chicago Professor there uh for years and years 10 years and that's the finance capital of the planet if you look at the number of companies being publicly traded has shrunk dramatically private Equity is doing a lot of this stuff imagine if all the private equity became publicly traded what what do you think would happen I mean what happened with the tax cuts under Reagan is that

47:03 all of a sudden uh SE corpse uh expanded dramatically in the number if you look at any of the stuff that uh Austin gouby has done and the number expanded everyone went back to Sea corpse because the rates were dropped dramatically I think you're going to see a lot of that happening now it may not be as cool and as good as it was in the 80s or in the 60s but I think it's going to be really cool now if it's not a 10xer all right I'll take a 2x or 3x or in real terms you got to look at it in real in real terms Y and if you look at that in real terms you need to have as many companies publicly traded available for the private Market you know for the Old Market and that I think you're going to see too if you get that corporate rate down to 15% or 10% or something like that why wouldn't these companies all these private Equity ones now go public

47:51 and be out there and trade it and you know I think there's a lot going on now don't make me tell you that it's going to be better than Kennedy or better than Reagan or even half a Reagan or half a Kennedy but it's going to be a good time and and I think you're going to be really pleased now you'll call me a liar 10 years eight years from now because I'm only up 3x not 10x I would never do that Dr you know what you know what I'm saying though I am just very excited that it's not going to be a Biden World War II I'm really really was depressed coming into this and I mean that my grandchildren I got 14 grandchildren four great grandchildren you know and I was looking at what's going on in Ukraine when I'm looking at world history and I'm seeing a really ugly ugly future it's now not ugly it's now

48:37 really much prettier than it has been for a long long time in every guard well I think given the scope of your career uh and the um kind of front row seat you've had through the administrations um I I'll say for for me personally but I imagine I'm speaking for a lot of viewers here gives me a lot of comfort to know that somebody who's got the the perspective that you do is is suddenly feeling a lot more relieved about the country's future prospects yeah as I told the one said okay Lord you can take me any now I'm all right I'm leaving on a high note you know I don't want to leave I want to stay around for as long as possible but I I love it that I'm I'm I'm coming to the 85th year of my life on a very high note all well look as

49:22 long as you were around Dr laugher you were welcome on this program to come on this program anytime you're welcome to call me anytime I love being with you than by the way I love that white uh White Oak behind you I love it well thank you thank you um real quick I I I realized I forgot to ask you about one important thing um I think you you you mentioned it briefly but what is your expectations for inflation given this economic plan I assume you think it's going to go down pretty dramatically the one I the one I didn't answer that I didn't answer was the FED uh and I don't know what the answer there is and inflation does depend upon whether fact we get a cure at the FED now with extra economic growth that means inflation probably will be dropping uh because of the more Goods you have out there the lower the prices are going to be the

50:08 lower inflation's going to be but I don't really have a good picture of inflation uh unless the FED is really corrected and that will take a dramatic move in the next two years okay um I'm going to let you go in just a second the question the question I'm trying to get to is is where can people follow you in your work but before I ask you that one I'm just curious and if you don't have an opinion of this say you have no opinion um I I wouldn't normally ask you about Bitcoin but part of uh the whole platform recently became we're going to have a Bitcoin strategic reserve for the nation do you have any thoughts at all one way or the other about that yeah Bitcoin Bitcoin and gold and all these things that have been rising are a clear sign that the markets are sick and tired of the dollar and other paper currencies

50:54 that have been monopolized by the government since since 1913 before 1913 we had private banking there was no government intervention uh at all I mean the government defined what a dollar was uh it did have mints but so did everyone else private sector was full of mins uh the only effective role the government had prior to 1913 was auditing Banks balance sheets and assuring that they were correct that was good but all the money was Bank notes and all that and for 2 and a half centuries prior to 1913 before the government started nationalizing inflation average 0% since the government's been nationalizing money starting in 1913 but then also the devaluation of the dollar in 33 under Roosevelt then the Smithsonian then the interest Equalization tax the voluntary forign credit restraint and now poy wowe uh and

51:42 his silly moves all of that now we have had an increase in the price level of 33 fold or 3,300 uh in a little bit over a hundred years it's time for us to get a private money back or if it's good possible have the government create a good money but I'm really not hopeful that's why I don't want to really comment to you solely on on Powell but I love the fact that Bitcoin is moving in I love the fact that gold is up by the way I do not own Bitcoin nor do I own gold uh I just don't uh but let me just say that I'm uh I'm really proud of the private Market trying to stop this Government monopoly of bad money all right well look Dr laugher the next time you come on um I'll be more fair to you and we'll I'll

52:28 give you more time to talk about where you would like to see money go going forward but a fantastic conversation for folks that would like to follow you and your work in between now and the next time you come on this channel where should they go I have a I have a I I've guess a website at the laugher center uh I don't know what what's my what's the laugh center.org La laugher center.org is where they can do but but don't expect anything from me I have a flip phone all right I I don't I don't do emails I have an email for someone in the office here is my email you know I I still write all of my books cursive uh you uh it's been Nick from geston it's been from for geston I'm not from yesterday I'm from day before yesterday so but I love it love it love it I love

53:13 seeing this world world evolve and I just can't tell you how joyous it makes me feel all right well folks if you'd like to see do laugher come back on this program sooner rather than later uh please let him know that by hitting the like button and then clicking on the red subscribe button below as well as that little bell icon right next to it um if you would like some help in preparing for uh the future ahead uh possibly a very good future for the markets as Dr lafer thinks we might be uh getting set up here for I recommend that most folks do that by working with a good professional financial adviser who understands all the macro issues that Dr laugher and I talked about here if you've got a good one who can do that for you great stick with them but if you don't or you'd even just like a second opinion from one who does uh then

53:58 consider scheduling a free consultation with one of the the financial advisers endorsed by thoughtful money to do that just go fill out the short form at thoughtful money.com uh only takes you a couple seconds to fill out the form um these consultations are totally free and there's no commitment to work with these advisers it's just a free public service that they offer and by the way when you're over there at TH money.com be sure to click the newsletter Link at the top of the website to sign up for our free newsletter over there at subst back Dr laugher I can't thank you enough this has just been fantastic as usual and I wish you all the best in the future my pleasure thank you sir all right everybody else thanks so much for watching