Government Spending and Economic Recovery with John Stossel on 20/20

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... doesn't stop them? >> they have holes every few feet here. >> plus, can you still make it in america with $25 and a dream? >> i've got car, furnished apartment. life is pretty great. >> hear all about it. >> hello? >> bailouts and bull. here now, john stossel. >>> good evening. elizabeth vargas is off tonight. now, i'm going to stick my neck out with some unpopular ideas about how government spends your money. we have to spend the politicians say, because we're in a crisis. and if you don't believe we're in a crisis, the politicians are eager to remind you. >> the situation wee face cannot be more serious. >> economic crisis, the worst since the great depression. >> the edge of catastrophic failure. >> reporter: it's frightening just to turn on the television. >> crisis. crisis. >> escalating crisis. crisis intensified. >> housing crisis. >> economic crisis. >> unpress departmented crisis. >> crisis. >> crisis. >> crisis. >> crisis. >> reporter: okay. i get it. it's bad. the stock market's down and unemployment is past 8%. but what should a country do about that? the political class says we know. >> we need to act boldly. >> and we need to act. >> quickly. >> stimulus fast, and we need it big. >> reporter: and so stimulus we've got. and bailouts and rescues, adding up to billions, trillions of your dollars. about $16,000 per worker. it's like government saying, we have to take all this money from each of you and give it to cities so they'll build new roads and here's some for hiking trails and banks, big banks, fannie and freddie, aig, you need it, too. take it. this will stimulate the economy. >> this is a jolt to the economy. >> stimulus. >> stimulus. >> this is exciting. >> reporter: some are so excited, they can't get the numbers right. 500 million people will lose their jobs each month until we have an economic package. >> 500,000. >> what did i say? >> 500 million. >> reporter: herehe goes again. >> 500 million americans lose their jobs. >> reporter: but if politicians are confused, don't worry, they say. all the economists are on our side. >> we have a consensus. >> every economist from right to left. >> no disagreement. >> reporter: is that true? how many of you believe if there were no stimulus we'd recover sooner. these economists are among more than 300, including three nobel prize winners who signed this petition that said we do not believe more government spending will help. >> just absurd. >> look at the price tag, it's enormous. >> it should cut spending. >> americans will live to rue the day that we have these poliies in place. >> reporter: it may surprise you that so many oppose the bailout since we've heard -- >> there's no disagreement that we need action. >> reporter: there's lots of disagreement. >> how is government going to be able to spend a dollar that it generates a dollar or more in value? >> reporter: they spend the dollar, it gets used by many people, creating more wealth. >> a more likely possibility is that a dollar that government takes out of the private sector is a dollar the private sector doesn't have a dollar to spend. >> reporter: i wanted to ask the big boosters about the doubts, but they wouldn't agree to an interview. how can i reach them to ask my questions? questions like -- too much debt got us into this mess, why is more spending good? don't these questions deserve answers? where are you going to get all this money? eventually, two members did agree to talk. majority leader steny hoyer and maxine waters. >> we have to do this? >> absolutely. we're in an economic crisis. government can't sit and just twiddle its fingers. >> inaction, everybody agreed, was not an option. >> reporter: everybody? >> if i said every, perhaps overstated the case. but more importantly, most of america in polling data said, we needed to act. >> reporter: but that doesn't mean they're right. >> well, no, it doesn't. but we're a democracy, and we're in the deepest recession we've seen since the great depression. >> since the great depression. >> could be worse than the great depression. >> reporter: politicians keep saying that. >> worst economy we've had since the great depression. >> reporter: but unemployment was 25% during the great depression. it's 8.1% right now. few people even remember the recession 20 years ago. >> markets go through corrections all the time. >> reporter: but this is worse, i'm told. going to be like the depression. >> but markets need to go through this correction. >> reporter: it's a reason this group opposing the bailouts. for a market to recover, they say, it must discover its true bottom. so, let companies fail. >> no company is too big to ...