John Stossel is the best-known libertarian in the news media. As the co-anchor of the long-running and immensely popular ABC News program 20/20, auteur of a continuing series of specials on topics ranging from corporate welfare to educational waste to laws criminalizing consensual adult behavior, and author of best-selling books such as Myths, Lies, and Downright Stupidity, Stossel brings a consistent message of liberty to millions of viewers on a weekly basis.

It wasn’t always this way. Born in 1947, Stossel started out as a standard-issue consumer reporter, working in Oregon and New York before joining the staff of Good Morning America and, later, 20/20. He did scare stories about everything from pharmaceutical rip-offs to exploding coffee pots. Then, in the 1980s, he encountered reason, which radically changed his thinking about the benefits of laissez faire in economics and personal lifestyles.

“It was a revelation,” he writes in his 2004 memoir, Give Me a Break. “Here were writers who analyzed the benefits of free markets that I witnessed as a reporter. They called themselves libertarians, and their slogan was ‘Free Minds and Free Markets.’ I wasn’t exactly sure what that meant, but what they wrote sure made sense.”

reason caught up with Stossel in January in Los Angeles, where he was filming a special episode of 20/20 based on six reason.tv documentaries featuring Drew Carey. Among the topics: the desirability of open borders, the need to reform the nation’s drug laws, and the case against universal preschool. Ted Balaker, a reason.tv producer, talked with Stossel about bailouts, his hopes for the Obama years, and his attempt to educate a generation of school kids with a video series called Stossel in the Classroom.

Audio and video of the interview is available online at reason.tv/stossel.

reason: What do you think of the bailout mania that’s sweeping the country?

John Stossel: I think it’s disgusting. They keep saying everybody agrees that we have to bail these people out and the feds have to spend trillions of your tax dollars guaranteeing this and that. It’s just so irresponsible. We’ve got a $35 trillion Medicare liability already that they’re not facing. Now they’re going to throw more trillions of dollars to stop this recession, like we’re not allowed to experience any pain in America. There are recessions. There are booms and busts. Bubbles have to pop.

In this case, there are smart people, like [former Treasury Secretary and Goldman Sachs chief] Hank Paulson, making the argument that this is different: You’ve got the credit lock; the whole system is at stake. That is possible, but what I’ve learned over 30 years of consumer reporting is that the people closest to the problem panic. And when they panic, that is an invitation for government to get bigger. It’s not only war that is the friend of the state. Any crisis is the friend of the state.

The mad cow disease doctors were convinced we were all going to have holes in our brains and anybody who ate meat was at risk of these horrible diseases. The Y2K technicians were convinced all the planes were going to crash. Now it’s the Wall Street investment bankers, who unfortunately are allowed to spend trillions of our dollars in their panic.

reason: Let’s take a quick look back at the Bush years. Spending has exploded to historic proportions. Regulations exploded too. Yet people look back on the Bush years and say it’s a failure of free market policies. What do you say to that?

Stossel: I say bullshit. There was no deregulation under Bush. People don’t know that, yet everybody says, “See, your libertarian ideas, they’re wrong and this proves it.” First of all, there was no real deregulation. [The repeal of the Depression-era banking regulation] Glass-Steagall was done under Clinton, and he rightly defends that. Banks that had more options after Glass-Steagall were not the ones that got into trouble. Under Bush, the regulators have added more pages of rules than any administration ever. The cost of regulation has gone up more under Bush than any president before. And yet, because of the bad media coverage and assumptions about Republicans, people think it as
laissez-faire.

I’m sure there are some people at regulatory agencies—at least I hope there were—who said, “You know, a lot of these rules are bad and we’re going to be less aggressive about them under Bush.” But that’s not what caused this bubble. The bubble was the government saying: “Lend more, lend more. You’re discriminating against poor people; you’re racist. Lend to more people.” That’s not deregulation.

reason: What are your hopes and fears for the Obama years?

Stossel: My fear is that they’ll spend us all into bankruptcy and we’ll be like the people in the Weimar Republic, running around with wheelbarrows full of cash because inflation is so bad. We’re trillions of dollars in the hole for just Social Security and Medicare. They won’t have the guts to raise taxes. Well, maybe they will, but they won’t be able to raise taxes enough to pay for Social Security and Medicare because you’d have to take just about all people make, and that would totally destroy the economy. They won’t cut the programs because we older people want the best of medical care, and we’re going to demand it, and the politicians can’t say no to anybody.

reason: And your hope?

Stossel: Hey, Nixon went to China. Maybe Obama will be financially responsible. And maybe he’ll do the things that reason thinks should be done, like legalizing drugs and prostitution and ending the criminalization of behavior between consenting adults.

Hayek called it a fatal conceit to think you can plan an economy. I think it’s also a fatal conceit to predict what these politicians will do.

reason: Talk about your collaboration with reason.tv and Drew Carey and how it came about.

Stossel: reason magazine has always meant a lot to me. I was lost in the political wilderness and politically naive. Conservatives didn’t make sense to me in the magazines I was reading, and the liberals who controlled the media where I am always said government will fix it and we just have to spend more. That made no sense to me either. Discovering reason was just wonderful. I could see that, wow, there was another way to think about these things. I’ve always read the magazine. [Former Editor] Virginia Postrel was my teacher originally, and when you guys started doing television, I thought, “Great, let’s take the best of it and get it out to a wider audience.”

reason: Is the mainstream media biased?

Stossel: Yes.

reason: Is it because liberty just isn’t TV-friendly? You can pass a minimum wage law and go interview the happy employee at Burger King who just had her wage boosted, but you can’t interview the person who doesn’t know she got squeezed out of a job.

Stossel: That’s part of it. It’s certainly hard to show the people who arehurt by a government program that takes two cents from everyone or prevents a job from being created. You can’t take a picture of that. I think liberty intuitively is hard to get. Intuitively, the minimum wage makes sense. We want to help poor people, so raise the minimum wage. It’s hard for people to understand how that hurts people.

Plus, there is just the basic political bias. The people with whom I work read The New York Times and The Washington Post, and that’s their world. Everybody around them agrees with them. They all lean left, and they think that’s the middle.

The Internet has shown people that there was a liberal media. Now the public at least knows that ABC, NBC, CBS lean left. CNN, especially. MSNBC gets talked about a lot on the Internet. Thanks finally to the Internet and cable deregulation and Fox TV, people have an alternative from the days when government monopoly limited the number of TV stations. The broadcast networks lobbied Congress to say if you allow cable to come in everywhere, then poor people who can’t afford cable will be deprived of free TV. So there were five channels. That helped me make more money, but it certainly wasn’t fair. It’s far better that we have 150 channels now. It’s right for people that they should have more choices.

reason: What sort of new media gets your attention?

Stossel: I’m embarrassed to say that I still read magazines. I’m still reading reason in its print form, and The American Prospect and The New Republic and National Review. It’s the traditional publications of the left and the right. I’d like to say I check Google all the time, but I don’t.

reason: Do you think the libertarian worldview is gaining influence?

Stossel: I don’t know. It’s easier for me now because there are more points of view on TV. That makes me think at least now people know these ideas deserve a place at the table. It’s why ABC lets me do my specials, but are we winning?

This move toward more spending makes me think not. On the other hand, as [Cato Institute Executive Vice President] David Boaz often points out, if you are gay or black or a woman, we forget how America has changed, how much more freedom there is. It’s a mixed bag.

Government’s much bigger, but in many personal ways we are freer. The fall of the Soviet Union in some ways is a danger because we used to have role models of failure. Now you have the left saying, “Ah, we just have to do it right, be more a middle way between government and capitalism, like Europe.” We have models of failure in Cuba and North Korea and the post office and the motor vehicles department, but they are relatively few. People still say, “When I’m scared, government must step in.”

reason: What are some of the things you regret about your career?

Stossel: Now that I’ve wised up to the benefits of economic freedom, I regret much of my first 20 years of bashing business, of calling for more regulation. That’s the intuitive reaction. You send the TV out to 15 repair shops. Some people cheat you. Politicians call me up and say, “Oh, great piece, we’re going to establish a department of consumer affairs and license TV repair shops and car repair shops.” If you haven’t read reason, it sounds good, because you like licensing. We license dogs and drivers. It sounds like the right thing to do.

I encouraged that sort of thing for many years. Just scare stories: “Danger in the Grass,” things about lawn chemicals that were over the top.

reason: I was worried about exploding coffee pots during my whole childhood because of you.

Stossel: I did a story on somebody who died because their house caught fire after their coffee pot blew up. These things do happen, but it’s a big country. There’s a lot of nasty stuff happening to people. You’ve got 50 people who die every year from plastic bags.

reason: What about the flip side, the things that you look back on and you’re truly proud of what you’ve done?

Stossel: My first special was this show called Are We Scaring Ourselves to Death? That’s when I finally said, “We’re scaring people about everything. We ought to put this into perspective.” I read Searching for Safety by [political scientist] Aaron Wildavsky, which really opened my brain. I tried to put risks in perspective. It was tough to get on the air. Two freelance producers quit rather than work on that show. They said I wasn’t objective, that it was conservative dogma to say that regulation itself might hurt people. To ABC’s credit, a producer said, We don’t agree with you, but this is an argument that deserves to be heard.

More recently, we did a special called Stupid in America, which was about education. I worried that the show wouldn’t be well received because education isn’t good TV. It’s just people, kids sitting at a desk. But the ratings—we get minute-by-minute ratings now—went straight up. It was the highest-watched show that night, as was the repeat. It argued pretty forcefully that choice and competition might make a big difference. There’s this argument that the reason public education is failing is that we’re not spending enough money. We’re spending $11,000 per student. If you do the math, that’s more than $200,000 per classroom. Think what you would do with that money.

reason: Drive the kids up in limos?

Stossel: Hire four excellent teachers. It just shows that government monopolies waste money. That special stirred the pot some. I’m happy with that show.

reason: If you look at the positions you’ve taken over the years, there’s a lot for conservatives to dislike about you and a lot for liberals to love. You’ve spoken out against corporate welfare, against greedy peddlers of junk science and medicine ripping people off, in favor of legalizing drugs, gay rights, and free speech. Yet it seems almost always that you’re widely adored by conservatives and widely scorned by liberals. Why is that?

Stossel: I’m not sure, but you’re absolutely right. Somebody came up to me in New York and said, “Are you John Stossel?…I hope you die soon.” He was a legal aid lawyer. There is this real hatred on the left because I’m a consumer reporter defending business, and they just so hate business.

I don’t know. I mean, I’m prochoice. I was against the war in Iraq. I think homosexuality is just fine. I want drugs legal and prostitution legal. Yet conservatives invite me to their conferences and give me standing ovations. Sometimes. Not always, but they generally like what I have to say. I even mention some of that, and it shows how pathetic it is for conservatives in the mainstream media that I, a libertarian, am the closest thing that they have to invite to a conference.

This hatred of business—I’m not sure what that’s about. I used to think it was envy, that the college professor is angry that his slightly stupider roommate is making more money than he is because he’s in business. Then you think about the kings and queens of Europe. People didn’t hate them for all their wealth, and their wealth proportionately was vastly greater than now, but they hated the bourgeoisie. They gave them that nasty name. They hated the very people who sold them the things that they needed to make their lives better. What’s that about?

My best guess is that it’s the intuitive reaction that the world is a zero-sum game, that if he makes profit off you, you must’ve lost something. If you don’t study economics, that is how people think. I see why politicians think that way, because that’s how their world works. One wins. Somebody else has to lose. We have a lot of work to do to explain that free commerce doesn’t work that way, that everybody gains.

reason: Talk about Stossel in the Classroom. What is it, and what do you hope to accomplish through it?

Stossel: I’m very invested in that now. We do these shows, and they cost ABC almost half a million bucks, and then they air and they’re gone. Teachers sometimes wrote in saying, “I wish I’d taped that because I wanted to show it in class.” Or, “We did tape it and I showed it in class, and the kids, quiet kids who’ve never spoken all year, suddenly they were up arguing. We had a great discussion. Can we get more of these things to use in the classroom?”

I had some shows like Greed or Is America No. 1?, which discussed why America is prosperous. You ask kids, and they say it’s because we have democracy and we have natural resources. I point out, well, India has democracy and natural resources, but India’s poor. They’d say, India’s overpopulated. Actually the population density of India is the same as that of New Jersey, and New Jersey’s doing OK. And Hong Kong has no natural resources and 20 times as many people per square foot as India, and Hong Kong got rich. In 50 years it went from the Third World to First World because, as Milton Friedman points out, economic freedom is the answer to why a country’s prosperous. The British rulers in Hong Kong enforced the rule of law, kept people and property safe, and then they sat around and drank tea. They left people alone. To me, that’s such a valuable lesson for kids.

Weirdly, more public school teachers are asking for these. Now I have a nonprofit that raises money to buy them from ABC. Any teacher can go to stosselintheclassroom.org to get a DVD with teacher’s guides and suggestions for how it meets the curriculum.

reason: What are the stories that you’re still itching to do?

Stossel: I would love to do more on Medicare. We did a show called Sick in America, which touched on the success of free market medicine and the times and places where it’s been allowed to flourish. As we criticize Bernie Madoff, I’d like to point out that the government’s running a bigger Ponzi scheme in Social Security and Medicare.

We are working on a show that asks why, if you’re an owner of a business, can’t you hire and fire who you want? Why can’t you refuse to hire older people if you want because they cost more? Or refuse to hire pregnant women because they’re probably going to leave, or they’re certainly going to take time off? Who gets to make these decisions? You or the state?

As reason readers know, companies that were racist and homophobic would bid up the price of whites and straights, and a business then that hired only gay men or women would clean their clock because they’d have better workers they could hire more effectively. The market sorts these things out. But again, that’s an education job to explain to people.