Steve Ballmer - Making Government Spending Transparent with USAFacts | The Daily Show

So a storied career. You're one of the first employees at Microsoft. You become a CEO of Microsoft. You own the Los Angeles clippers. You have this dream life that, as a kid, you probably never even thought those were the heights that you might be able to attain. And in that moment, you turn your attention to creating a fact website. Exactly. I retire from Microsoft-- Yes. --and I have nothing to do-- Yes. --except to dive deep dark into government numbers. Seriously. It feels like an anti-midlife crisis. It feels like a man who's decided, well, I'm just going to give up. Well, my wife kind of got after me to start helping with the family philanthropy. And I kept saying, no, no, no, no, government takes care of all those things. JON STEWART: And they don't. And she said, you're coming with me. And I snuck in the back and said, but I'm going to look up the numbers. And you did look up the numbers. And so what you've done is-- and it's a phenomenal site. And I make jokes, but it is so necessary in this world to provide the data from reputable sources. How do you even-- how do you decide what to put in there? How do you decide what are the sources? We have a guy here, Adam Chodikoff. In Chods we trust. He is a researcher extraordinaire. He is the one who aligns us with, that's kind of a partisan site, you might to stay away from that, that's kind of a thing. Is that how you operated or is this an algorithm? How is this done? No. We started with the concept that said, let's look at government in its totality, because if you look at little pieces, boom, I grab a number and I can make it sound large. I can make it sound small. So let's put things in context. Let's put them in context with history. Let's only use government numbers. We go to a hundred different government databases. And then we said, what does government do? We turn to the prologue of the Constitution-- preamble to the Constitution. It lays out four missions. We took everything government spends money on, boom. How much taxes are we raising and other money? How much are we spending? And what kind of outcomes are we getting, because government is not like a-- lot like a business. So that-- so that to me is-- is the crucial aspect. You know, when Democrats talk about, we need to tax billionaires more-- no offense-- and when we need to do these things, I think the one place where it falls short is, I don't think people feel that more money is necessarily the answer, but maybe efficacy. The way-- it's not like we don't spend money on anti-poverty. It's just the efficacy might not be there. Did you discover programs that seem to be really effective and other areas where that money seems to be squandered? What were some of the-- the data points that you found that gave you a clear picture? Let me start with 86% of all federal. And I can talk separate about state and local spending. JON STEWART: Yes. But 86% of all federal spending is in a few simple areas. JON STEWART: OK, let's go. Number one, paying our debts. Got to pay the interest on our debt. How much goes to the debt? I've seen breakdown of taxes. I've heard that the third largest or second largest portion of our tax money goes to pay down the interest on the debt. It's creeping up there. It's number five right now. We go social security is number one. JON STEWART: OK. Medicare number two. JON STEWART: OK. So two things that we pay into but don't get till we're older. - Correct. - OK. - Correct. - What's number three? Number three is the military. JON STEWART: OK. Medicaid, part of-- JON STEWART: Is four? Medicaid is four, exactly-- sorry. The debt is four. Medicaid is five. OK. Veterans benefits. JON STEWART: OK. Let me see if I forgot any. JON STEWART: You know what, though? So let's-- let's stop right there, because I-- Stop right there because there's no inefficiency so far. Well, so I would disagree with that. OK, go ahead. So if I'm a-- if I'm thinking about this country and I'm looking out into the audience and I'm saying, so what is the tension in their lives? And I don't necessarily know that because we've only worked together as an audience once before. [LAUGHTER] But I would say it's the squeeze. It's people that had some college debt, but now they're in their 40s or 50s, and just as they're clearing out all those things and getting into a decent earning place, their kids are getting ready to go to college, and the costs of that have exploded. And just as that's happening, their parents, who they thought were going to be fine with their social security and their Medicare and all those other things, are now needing real elder care and assisted living care. So now, all the equity that they have built up over that time is now dissipating between those two groups. So child care, health care, elder care, all those things. The first six tranches of where our tax money goes doesn't seem like it's spent efficiently on relieving that pressure on families. Now, that might be the wrong way to look at it. - Let me-- let me push back. - Please. Let me push back. I give you-- well, not you. You can give me. I'm 68. You give me a social security check. I take money from you. You take money from me. That's just my premise. OK, fine. Probably a good one. - Your premise-- - It's probably a good premise. - Your premise is fine. Probably a good premise. All right. Anyway, a family gets a social security check. JON STEWART: Right. That's going to help that senior, who may need care, may need this, may need that, may need something else. JON STEWART: But designed mostly by the government because they thought we would all be dead by 65. Like, we've all out-- we've lived much longer than the government thought we would. The promise-- yeah, the promise of FDR days, we've outlived it. Nobody's quite sure what to do about it. We do know that people are doing less of their own elder care. More of that's getting paid for in the-- by the government and the market through third parties. But you do see a lot of people who their elder care is paid for by whatever equity they had left so they can't leave anything to their kids. They mortgage their house or they go through those things where they convert it into liquidity. And they use that money, hopefully, and it's there till they-- till they pass. It's a little bit of whack-a-mole, though. Yes. We can increase taxes, we can borrow more money, or we can live with the kind of spending profile we have today. I mean, something gives in that equation. And me personally, I will confess, nonpartisan view for USAFacts-- we just give you the data, you make up your own mind-- I'm a businessman. Balancing the budget seems good to me. And so I look at it and said, it's simple. We probably need some more taxes, probably. And we probably need less spending, probably. Less spending or more efficient spending? Is it-- is it a question of, are we using-- for instance-- so Mark Cuban was on. And you guys, I'm sure, go to the Billionaires Brunch. [LAUGHTER] Which, by the way, I never understood. Why do they do that at Waffle House? It feels like you could get a better-- well, forget it. It's Billionaires Basketball Lunch in that case, but go ahead. Billionaires Basketball Lunch. So he finds out that these pharmaceutical benefit managers are jacking up and hiking all these pharmaceutical prices. The government is not really allowed to negotiate with them, so he creates this business in which he does that. Is too much of our money that we spend on poverty programs or elder programs going through these middlemen that are enriching themselves? Even the ACA, right? You think about Obamacare, what it really is, is a boon for insurance companies to jump into another marketplace where the government says, well, we'll keep this same inefficient system, where you get to deny care when you want to and the pricing isn't transparent and it's not really a free market system, because health care is in a free market system, and we're just going to subsidize that insurance policy. It doesn't really change the dynamic of how health care is-- is given. Isn't that inefficient? Yes, and-- You son of a bitch! Yeah, son of a bitch. When you put it in a little bit of context, it's inefficient. But if I tell you it's less than 1% of total health care spending in the US, less than 1%, you can say it's inefficient. I won't disagree with you. I can say it's 1%. And so even if we crushed the issue, you're talking about down to nothing, down to absolute nothing. We still have a problem with health care spending. JON STEWART: Right. We still are-- the need to deliver health care. But isn't some of the problem we have with health care spending, because the largest tranche of customers are unable to really negotiate effectively, because it's not-- we have a for-profit health care system when you can't comparison shop for heart attack doctors. You basically get driven to wherever is closest. There are three people, basically, who insure almost everybody. 92% of Americans are not sure. Well, let's just talk about who are the three are. Medicare, where they can negotiate some things but not others, for example, prescription benefits, except for the new caveats. Medicaid, where government negotiates really hard, really hard. I'm really impressed by what the government negotiates on behalf of the Medicaid patients. And then private insurance for private insurance companies. And they're grinders, baby. You know, they're delivering health care $6,000 a person. Now, they're younger. Medicaid, the most vulnerable people in our population, $10,000 a person, harder to take care of. And then seniors, $16,000 a year, Medicare. Who do you think is most satisfied with their-- with their care in those three tranches? Private insurance, no question. Private insurance. I mean, I-- again, I don't have data from the US government, but I'm going to guess private insurance. Right. Is there any qualm in your mind of, you know, they say that the biggest reason people go bankrupt is medical bankruptcy. Is-- is there any reason in your mind that a country like ours, with the wealth that we have, should ever have a situation where people who are sick-- so they might be more satisfied, but is it at the cost of the percentage of them that will go bankrupt because there's no government backstop on it? Well, do I think it's a good thing? No. I don't think anybody should go bankrupt for their health. I don't. Now, how do we get from where we are to there-- JON STEWART: Yes. --is important. It is important. I have no prescription for that. But me personally and emotionally, I agree with you 1,000%. JON STEWART: Right. But to solve that problem, what other changes are we going to make? What are the things that we're going to give up? What are the things that we're going to get? It seems like a much smaller fix to fix that problem than to try to reinvent the health care system, again, when-- when health care-- Look, we have problems in our health care system. But the inefficiency, I think, right now tends to be, if you just compare US to Europe, we do about twice as many procedures as they do in Europe, and our medical professionals get paid about twice as much as European medical professionals. So doesn't that sound like it's a system incentivized to that? It is. And it is. And it is. Absolutely. Except Medicaid. Right. So they don't do twice as many. Except Medicaid, because Medicaid is-- essentially, it's on an HMO model, and things get negotiated differently. Do you think that a public option, you know, the one that everybody shouts is the death of it all, is the thing that blows up the system? Because in some ways, I always look at it like, what do I think government's purpose is? Like, I love the fact that we're a checks and balances system, right? And it seems like within the government, there is OK, judicial, congressional, executive, and they're all pushing and pulling. They weren't expecting the kind of partisan battles that we get, but we get them. But it does seem like corporate power, transnational, multinational corporate power, also needs a check and a balance because capitalism is, at its heart, like, destructive. There's collateral-- it generates wealth, but it's destructive. Why do we fight so hard against the government being a proper check on that, against that exploitation, whether it be in the medical field or in the college education field or any of those other things? It seems like in European countries-- I'm not saying it's a panacea. They pay more money. But they seem to get the services that connect more directly with their lives, sort of back to the earlier conversation that we were having. I think if you read these tranches out to a European social democrat, whatever, they would think, well, that's crazy. You haven't gotten anything. You haven't gotten any child care. You haven't gotten any of the things. You haven't gotten free education. Why is it that we have so much trouble? We generate so much wealth. Why do we distribute it so inefficiently, it would seem? Well, I think-- let me-- let me give a perspective. Please. I think the twin towers of America are democracy and capitalism. JON STEWART: OK. I really believe that whole heartedly. JON STEWART: OK, I don't want to tell you how that story ends, but go ahead. [LAUGHTER] Good point. No, but you-- so-- [LAUGHTER] You're killing me here! You're killing me here! It's tomorrow, for fuck's sake! Jesus! What are you doing to me? - All right! I'm in New York! I walked right into it. I'm sorry. I apologize! What do you think I'm doing all day tomorrow? [LAUGHTER] All right. - My bad. - All right. - Anyway, let me go back-- - Capitalism and democracy. - They're the two pillars. Yes, pillars! Thank you! Pillars! Pillars! [APPLAUSE] Thank you! Much better. Capitalism is the predictable one, actually. Really? That's interesting. You-- you give capitalism a set of rules. People are going to compete. They're going to try to make as much money as they can. And that's what's going to happen. It's predictable. JON STEWART: But you don't think it's, by its nature, exploitative, though? Like, the monopolies, the rigging of the system, that seems all built into it. I'm going to get to the second part, democracy. Sorry. I'm sorry. Democracy. So the fact that capitalism is predictable is actually a great tool for government. JON STEWART: OK. Government needs to then train this highly predictable tool to do what society wants it to do. That's the rule of democracy, is to-- it is a rule of democracy, is to inform where you want to point this highly predictable capitalist motive. And look, if the world needs more regulations, put them in. But you're going to get-- JON STEWART: Well, I don't know if it's more regulation, but it certainly needs to be something that helps protect us against capitalism's baser instinct. In some respect. Just let me give base instinct, OK? OK. Let's say my base instinct is to I want to destroy the habitat of a set of birds by building a windmill, OK? Let's say that's-- that's-- that's the topic. Can I just say something very quickly? - Yeah. - You bastard. [LAUGHTER] Why-- you son of a bitch! OK, Mr. Democracy, let's take it on. The birds-- Yes. --the capitalist is going to try to get that windmill built. JON STEWART: Sure. If you want it built, capitalist will get it built. If you want to protect the birds, the capitalists will stop trying to build that windmill. I talked to a guy who's actually trying to build one of the largest wind farms in the world. I'm going to give you a different example. Give me a different example. Capitalists want to find the cheapest labor they can possibly find. Sure. So they offshore all the jobs in manufacturing and all these other things to Vietnam and Bangladesh and India and China and places where worker protections don't exist, undercutting American workers. And the democratic system fails its own workers, and not only allows it, encourages it, and then decides, well, you're doing so well on labor costs, why don't we cut your taxes as well? So that's-- in my mind, I view it as the pendulum has swung completely, and we are at the mercy of those instincts. And democracy is failing in whatever its directive is. It doesn't sound to me like democracy points capitalism. It sounds to me like capitalism points democracy. I'll speak-- I think. I'll speak now as a former CEO. [APPLAUSE] Capitalism responds-- and look, people are generally good people. They'll respond to-- you give us an incentive, we'll go do it. You give us a regulation, we're going to obey it. That's what-- that's what-- no, that's what happens. It really is-- all right, to the 99%. Geez, you won't let me get anywhere here! I give you 2008. Yeah-- But no, I-- So-- so all I'm saying is, if somebody-- let's take your labor-- labor cost issue. JON STEWART: OK. Perfectly good issue. Yes, businesses are going to try to reduce labor costs. If you don't want those jobs to move, then government needs to put a tax or an incentive-- they're sort of kissing cousins, if you will-- to keep the jobs onshore. JON STEWART: But what about-- But now-- and take the consequences, though. But then we're competing for their love. What about this? They get the benefit of our stability, of our capital, of all the things that make us a free market, stable democracy, and they have no responsibility. They get all of the infrastructure and none of the toll. And that's the part that I don't understand. You know, we have states competing with each other for who can fuck over workers the best. You know, when everybody talks about globalization and, you know, Mexico and India are stealing our jobs, well, South Carolina is stealing them from New York. So they're all competing to see who can give the sweetest deal. And that feels like where the balance is off, where the pendulum has to swing. I personally have no problem with government providing more direction to capitalism. I don't. JON STEWART: Right. But then there, sometimes, are untoward consequences. Let's just take the offshoring. - Sure, sure. OK. Let's just say whatever the policy is, it gets more jobs onshore and at higher wages. Right. Prices will go up. Prices will go up. And as long as that trade-off is the trade-off that people want-- less buying power, but more people have higher-paying jobs-- how that actually shakes out for the American-- I'm not an economist. I'm not going to make predictions. But there is a trade-off on most of these decisions. Is there a possibility, though, that there's a renegotiation of what normal is in terms of profit margin and in terms of capitalization and in terms of corporatization and in terms of taxation? Is there-- is there a new normal that can be achieved? You know, we saw it in the pandemic where, of course, there were supply chain, you know, crunches, and that drove up prices. But there's no question that a lot of companies took advantage of a difficult moment to set a new bar of expectation for people. And now that the supply chain has eased, that expectation still exists. Since the start of the pandemic-- Yeah. --CPI price index is up about 19%, OK? We still have inflation. Those prices are not going to come back down. They're just going to grow more slowly. Wages were up 21%. JON STEWART: Right. Wages were actually up more than prices. JON STEWART: Right. And so if you take a look at it, the buying power-- it's not much, but the buying power of Americans increased slightly, slightly. So nobody likes inflation. It's too disorienting, et cetera. But it wasn't a net negative trade. It feels bad. People feel bad. I know that. JON STEWART: Do you think, though, that, as complex as inflation is and all the different avenues that go into it, do you think a portion of it at least-- because I listened to some of those earnings calls in the pandemic, and people were like, we're killing it, our profits have never been higher. And everybody's like, yay. [LAUGHTER] So isn't-- isn't that a part of it? Then I would say, if I was to make a suggestion, go increase corporate income taxes. Just increase corporate income taxes. That reduces profit. I just don't know-- I mean, that's-- I just don't know if it's politically viable. You don't want the business regulating individual decisions-- this is my point of view-- bad. Do you want to take my profits as a company? Take them. JON STEWART: Do you think there is a transaction to be had between government and corporate leaders where they come to an understanding that it's a more symbiotic relationship and not an exploitative relationship? The invisible hand, so to speak, of Adam Smith. JON STEWART: Yes. There is no master planning. You can't say, be nice. JON STEWART: But we're not free-- there is, though. There are subsidies that they get-- there is no-- There's subsidies and there's regulations. There are rules. And I love that. I love-- look, there's some regulations, if I'm running a company, I might like or not like. We just built an arena for our basketball team. Why? We had to have our own home-- I was just kidding. --so we can beat the Knicks when they come to town. Let me just explain very quickly. That was-- [BOOING] [LAUGHTER] Punch it! No, it makes sense. Listen, man, it's an incredibly complex conversation. And I really do appreciate your patience with me on it and all that. It's just I think the frustrations have been with-- what I love about your site-- and let's bring it back to that-- is that you've brought together all the data and context necessary to have these conversations. Because these conversations feel like they don't occur. All that occurs on the news is, how do you think that's going to play in Wisconsin? Like, nobody seems to want to get into the weeds on what you're talking about. Well, that's what we're trying to do. We-- we have very conscious, nonpartisan, here's the data. We're going to make it digestible for you. We're not going to try to tell funny stories. We're not going to make forecasts about the future. There's a quote that's very motivating to me as we started this thing from James Madison. So you go all the way back to the founding of the country-- pardon me? JON STEWART: No, go ahead. I was just kidding. He said something like, a popular government without popular information or the means of acquiring it is a prologue to a farce or a tragedy or perhaps both. And as I sit here and I observe lots in American politics, I believe that. And our side is trying to combat that by making popular information available to our populace. We make videos. We make videos. And who's the star of the videos? Steve Ballmer. [CHEERING] I'm just going to say something real quick. Not for nothing. [APPLAUSE] You live in Los Angeles. You couldn't grab Hanks? Come on. You know what I'm talking about? Throw him out there to give some facts. It's a fabulous site, and you're doing great work there. And I so appreciate you coming on and giving us such interesting perspective on-- on business and government and regulation and all those different things. It's really helpful. So thank you for doing that. Check out usafacts.org. Mr. Steve Ballmer.