KXEL Presents: The Jacobsen Group Podcast – January 17, 2026

Who used all the Wi-Fi?

Ah, apartment life.

Bad Wi-Fi, mystery laundry piles, and a roommate who says, I'll Venmo you.

Maybe 2027 deserves an upgrade.

Coming August 2027, Four Lakes Properties introduces the brand new Union Station Apartments, furnished in-unit washer and dryer.

Internet included a great central downtown location, one to five bedroom apartments, and no double occupancy fees.

That's less adulting and more actually enjoying where you live.

Union Station Apartments, now leasing from Four Lakes Properties.

Wait, we have a washer and dryer in the apartment?

apartment?

Who used all the Wi-Fi?

Ah, apartment life.

Bad Wi-Fi, mystery laundry piles, and a roommate who says, I'll Venmo you.

Maybe 2027 deserves an upgrade.

Coming August 2027, Four Lakes Properties introduces the brand new Union Station Apartments, furnished in-unit washer and dryer.

Internet included a great central downtown location, one to five bedroom apartments, and no double occupancy fees.

That's less adulting and more actually enjoying where you live.

Union Station Apartments, now leasing from Four Lakes Properties.

Wait, we have a washer and dryer in the apartment?

If

you're enjoying this KXEL podcast, then we invite you to listen to KXEL's great programming in real time too.

You can hear us on the radio statewide at AM 1540 and in the Cedar Valley at FM 100.5.

We stream live on the web, not only through KXEL.com, but also through our free KXEL mobile app.

and Alexa knows how to find us too.

It's where Iowa comes to talk.

News Talk 1540 KXEL.

Good morning on the Jacobson Group here on KXEL, 1540, 100.5 FM.

You can listen live and also go to the podcast, the Jacobson Group, kxel.com, slash Jacobson, J-A-C-O-B-S-E-N.

We're gonna have a wonderful show today.

We're gonna talk about free market enterprise economy.

And at the midpoint, some great entrepreneurs here in eastern Iowa.

That's the T's, guys.

And we thank our...

General sponsors as well, Jim and Cindy Jandron, who helped run that great enterprise Midwest Renewable Energy LLC out of South Eastern Nebraska.

Ethanol Renewable fuels energy for a strong America.

It's lean, it's clean, and it's green, as well as Jim and Cindy Jandron and their largesse of charity in helping fund a life.

Runners, liferunners.org.

Go to liferunners.org and order your t-shirt to run and walk for a life like the loving gracious Debra Jacobson does.

You know, it's also very healthy, guys.

If you walk 10,000 steps a day, you reduce your cardio risks by an incredible percentage, but also running and walking for life.

This group builds a culture of life helping.

expectant mothers and their babies along the way to birth and then after they're born.

LifeRunners.org, go to that website, Dr. Pat Castle, runs this wonderful operation and a lot of young college kids part of this too, young and old running together alike.

So we're going to have the great free marketers from out of you and the Gortney Institute on then Barbara Hames Bryant from the Hames Homes people and then part two of Gortney.

Guys, we are making free market enterprise great again.

And don't go away.

We'll be right back.

Economics is the study of human choice in the world we live.

Faith is confidence in what we hope for and assurance about what we do not see.

By investigating faith in economics, we can learn how they lead to human flourishing.

This is the Faith in Economics podcast, a presentation of the Gortney Institute at Ottawa

University.

Welcome to our show today.

I'm Peter Jacobson.

I'm the Gortney Professor of Economic Education and Research here at the Gortney Institute.

Joining us we have Dr. Russ McCullough, who's the founder of the Courtney Institute, also the Wayne Angel Chair of Economics here at Ottawa University.

And also we have Dr. Justin Clark, who is the Menard Family Professor of Philosophy and Ethics.

All right, so let's talk about this Trump fund that has come out here recently.

The announcement was made by Trump, of course.

He's calling it a Trump account, of course.

There's got to be his name on things.

When I first heard it, I was kind of like, well, why is his name even on it?

If Michael Dell is the one of Dell Computer, they made a private donation of $6.25 billion.

So a very significant gift to help seed some of this.

The concept is to give every newborn kid a thousand bucks.

And that's a one-time gift that stays in a tax-sheltered account, similar to what an IRA is, as near as I can tell.

And the kid gets to access to it at age 18, and they can start a business, they can go to college, they can do whatever.

And so when I first heard this, my friend, actually my fishing friend, Tyler told me about it, and I'm like,

I'm just against it right because at first I thought it was a publicly funded thing and and if we're spending an extra thousand what are we giving up you know then I got into the whole thing but then once I learned it was privately funded supposedly this is the part I'm a little fuzzy on that Michael Dell and others are privately funding this initiative then all of a sudden I'm like oh okay so and then I was wondering well why is Trump's name on it with the government and the reason would be for the IRS

purposes, right?

So it would fall into how these IRAs and Roths and 401Ks, it's all part of the tax code so that the money can grow tax-free, all the brokerage accounts out there, they know the government rules on what you can and can't do for, you know,

accounts that have a tax benefit associated with them.

The college fund account, this would be very similar to a college fund account, but the source of the funds and what you can do with it are following under new rules.

So that made me understand a little bit better why...

Trump was involved in the first place, kind of the creation of some new rules regarding it.

But, you know, from a financial literacy standpoint, I thought it was cool that, you know, kids will see compound interest and like, wow, if I didn't touch that thousand bucks for 18 years, this is what it grew into.

So it's kind of easy for people to see and understand.

And of course, their talking points are housing prices are going up.

Maybe this can help people buy and, you know, get into a house because it'd be a significant down payment.

blah, blah, blah.

So I'll stop there.

That's what I know about it in a quick nutshell.

I think I have a few more things, but Peter, what do you got?

Yeah.

So at base, what this program is, is an option to start a retirement account for your child when they're born.

And you can contribute to that account after tax contributions, I think up to $5,000 a year.

So it's not like a, you know, a massive input, which makes it like a Roth.

IRA

yeah after tax yeah up until they're 18 is when these contributions are available to be the positive and then after 18 you can no longer put funds in this particular account oh it can be withdrawn or it can be left in if it's withdrawn

then the same rule with a traditional retirement account applies that if it's withdrawn before 59 and a half there are penalties for withdrawing and less and so this is something Russ mentioned you use it for for example higher education first time home expenditures so if you withdraw from the account to do one of those things and there's some other exceptions too you don't have to pay any penalties on it so you've essentially just had a tax free investment.

which I do like that side of it.

I'll confess that.

But if you use it for like to take a vacation or something like that, you have to pay the standard fee for doing it before you're 59 and a half or whatever.

And so I have mixed feelings about it.

And one thing I'll add, so Russ rightly mentioned that there is a kind of like a $1,000 signing bonus you could almost call it, but that's actually temporary.

And so that's one thing that's not been made super clear yet.

The $1,000 bonus to parents who sign up for one of these accounts only exists for babies born 2025 up through 2028.

To this point, they could always extend that window and they might.

But basically, if you sign up for one of these accounts for your kid who was born between 2025 and 2028 and you get it sometime after July of 2026.

you will receive a thousand dollars from the United States government as like some initial seed money.

And just one time it's not like every year or anything like that.

And then you can contribute as a parent whatever you want to that accounts.

So yeah, we can talk positive as the negatives.

On the upside, I do generally like the idea of financial literacy.

So I like

pointing out to kids like what a small contribution up front can do over the course of 20 years.

I think that's really valuable.

I do think a lot of people will waste these accounts, but I don't think that's necessarily a bad thing because I also think that teaches a kind of lesson.

I also like the idea that for certain things that this is going to be basically completely fee and tax-free in terms of the gains from the investment.

Now, obviously, it comes in for mere after-tax income, so the upfront income taxation still applies.

But I like that a kid who's going to college who has $30,000 in their account, they can use it on college and not lose anything, or they could hold it to retirement.

Honestly, if your parents contribute the maximum per year,

$5,000 for your entire childhood.

That might be enough to ride into retirement by the time you're in your 60s.

I don't know.

I'd have to throw it all in the calculator.

So you also have to put these things in certain qualified index funds so people aren't like going to be able to like put this all in Tesla or something or do like meme account things with it, which you know, there's maybe some benefit to.

So those are some upsides.

I don't like the $1,000 contribution except for one thing, which is that I would love to see this sort of program replace social security.

I think it's perfectly possible to do this.

I think we would save a lot of money.

The US taxpayer would, if we stopped our social security system, and maybe even grandfathered in the current people, but then just had people's whole social security be an initial investment from the government, which I still don't love, but it's better than basically taxing today to pay today, rather than what we're doing right now.

So I would like it as a replacement.

I generally don't like though, just blanket redistribution.

And so ultimately, I like the mechanism.

I like the idea.

I don't like the government supporting money, and I will say there's one other thing that I don't love about it, but it's kind of like a second best world thing.

I actually don't love the financialization of the economy.

I don't love that it seems like in order to be a successful financial person, you have to be like investing and wheeling and dealing.

I'd prefer to live in a world where a safe return on your dollar is enough to get people by.

And so I think this is an artificial subsidy to big corporations at the end of the day because ultimately what we're doing is we're...

funneling money to the stock market.

When really I would prefer we just live in a world where the value of money doesn't constantly go down and then you could stay in right retirement.

But we don't we don't live in that world.

No matter how much I wish that's the case it isn't.

So given that we live in a world where you sort of need to be financially involved in order to make return fine.

So that's my summary of what it is.

That's my summary of my thoughts on it.

But I'm open to Justin or us having different thoughts or if you've heard other things.

So I guess my I mean

Part of it sounds great, but I'll play devil's advocate and list my worries, which is something like I agree with Peter that if this system could replace social security, that would be great because then we would have a system that works replacing a system that doesn't work, right?

Yeah.

And my worry, though, is that a medium case scenario is like, well, we get this and we get social security and then we have a system that works and a system that doesn't really work.

The big worry is that they do this in some kind of way that isn't sustainable.

And then we now have two overlapping systems that also don't work, neither of which is going to do the thing that it says it's going to do.

And now, of course, we are, as Peter noted, you can't just save your way to retirement.

You have to be this kind of investor and constantly be worrying about your wealth going up and down.

So we force

We turn savers into investors.

And then we just have these multiple opaque layers where people aren't sure what's coming from where.

That's that's my big worry.

So I'll shut up and you guys can.

Yeah.

So the first thing that came to my mind when when these 18 year olds turn that majority of people are just going to squander it.

free money let's go spend it and they're not going to really learn a lesson so if you put in a thousand dollars and just not add to it and it gets a rate of return which in stock mutual funds wouldn't be unreasonable 10% you know 8 to 12% but I just put 10% just to be somewhere that's 6,000 bucks after 18 years and then

If it's treated like an IRA, if you're an 18 year old and you basically have no income, you normally would face income tax, but they probably aren't making much anyway.

So they fall into a very low marginal tax bracket.

The IRA fee is 10% for Roth IRA.

So if they use that, that's 600 bucks.

So to me, that's not enough.

They're just going to cash it out and squander it.

And then again, all this was was

almost like government waste in a different way, right?

So one of my concerns in class is that the government comes up with some spending program.

They take taxpayer dollars today and borrowed money because the national debt's growing.

And then they spend it on something stupid.

And then, yes, that spending gets into the economy, but it's not in something productive or fruitful.

Now, here the argument is, oh, hey Russ, this is going to be productive or fruitful.

I'm saying the delay of the wastefulness is probably just going to be 18 years.

And we're still taking on more debt because we don't collect enough in taxes to begin with.

So from a- and let me back up a little bit.

This is all predicated on we're ultimately going to put something into place that's more government spending.

I'm all for it if more Michael Dell's step to the plate and other people get behind this and champion it, including Trump himself.

If it all stays that the seed money is from private hands, do it.

I'm all for it.

I think that's great because I think

there is a chance that more people will be a little more financially literate watching that thing grow over time and then again they have their lemonade stand and hey honey let's put this into your trump account so it has a thousand already you made uh 40 bucks at the lemonade stand you know what do you think about putting a fraction of that into the into your account oh i think that would be great mommy so uh the whole turning people into investors i'm not really worried about that i think we could probably be better off that way

especially if they learn the lesson of putting it in something and leaving it alone.

So being forced not to be able to touch it until 18 has some benefits as well.

Well, if every 18 year olds getting $600, I'm going to put my money into vape shops.

Yeah.

No, they would get 5,400.

The 600 would have been the fee.

And if they're

low tax, so

they would get 5,400.

So again, not even close to buying a house.

So maybe some of these comments about buying a house or going to college are predicated on people adding to the account over time.

I could buy that.

Yeah.

So I think with that in mind, my

kind of comment here is there is an extent to which like this isn't that groundbreaking.

So I'm going to talk about what's new, what's not.

Yeah.

Let's be clear.

You can currently like take out a Roth IRA in the name of like a child and contribute to it, right Russ?

Like there's no.

The child has to have earned income.

So technically there's there's not one currently.

So then the

college fund is possible,

which is a similar vehicle.

The only other thing is like the 1098 or whatever it is T or that's the tax form.

But you can you can currently do this with like education and it can roll into an IRA.

if you keep it below like 15,000 a

year.

And there's new

education accounts that have come out recently.

So we basically already have this because the way the education investment account works is that if you contribute $15,000 or less, I'm pretty sure that's the threshold per year.

The child can use that for their education.

And if they don't use it for the education as long as you stay below that limit, all the money can roll into like a retirement account.

And so you can sort of already do this.

The only exceptional thing here is that like you can't turn that education into

into a house right now.

And so the Trump account, you could cash out in order to buy a house.

You can't do that with the education without paying that 59 and a half, prior to 59 and a half year old fee.

And so there's like a little bit of a change.

The $1,000 is obviously a change, though technically that's temporary.

I actually bet that that stays if this program happens because of government.

But I would say that like more of what this is than anything is kind of like a marketing thing because

People don't really know about the education thing, but if you're getting a thousand bucks to sign up People are gonna sign up for these accounts to get their kids the thousand bucks more people than yeah sign up for the education thing So there and you know people don't know that the education account can be rolled into a retirement

So a lot of people

who don't know if their kids are gonna go to college wouldn't put their money in it because they don't realize that you can still keep it so

Ultimately at the end of the day, what new does this introduce?

Marketing and buying a house.

That's it really.

Like at the end of the day that there's not really anything groundbreaking here.

I will say though, I did run some numbers and for the parents who can afford it, which is like a non-zero number, they have two kids.

That's the average number of kids.

I wish there were, you know, three or four, but it happens to be two.

It's medium maybe actually.

So two kids.

$10,000 a year is the maximum you could contribute, right?

And a lot of people can't handle that.

Some people can't.

I'm not saying everyone can handle that, but a lot of people could.

If you contributed over 18 years, $5,000 a year to each child's account, by the time they're 18 years old, that account has already grown to about $3 million.

Yeah, we're getting into some big money.

And contributions can be.

And by the time you're retirement age, if I put in 60 here,

You're $190 million.

Now, I don't know how I got that right.

Oh, I double-check those numbers when we come back from break, but that's

like...

Oh, I know why.

It's because I continued the annual contribution back to that team.

They'd have to keep that

out.

There's going to be some nuances there, but... And the other new thing that will hit more on break is the private donations thing.

I think is big, so

we'll be back.

PPE, which stands for philosophy, politics, and economics.

Each of these three fields is interesting in their own right, but they intersect in ways that are important to understand, both individually and for your community.

If you find philosophy fascinating but want to make sure that your study of the subject is practical, if you enjoy economic analysis but want to see how economic laws interact with moral principles, if you are interested in politics but want to explore how economic and ethical realities constrain our political choices,

you should consider the PPE program at Ottawa University.

The Gordon Institute at Ottawa University is the best place in the Midwest for free enterprise education and its contribution to human flourishing, faith, and economics in action.

We have some great high school student programs like PPE Fest.

This is an event where students get to listen to some world-renowned speakers and then participate in competition geared around philosophy, politics, and economics.

Our everyday economics program is just a half day on a Saturday, and we will have an integrated discussion about common sense economics.

We have a college credit microeconomics course that runs every eight weeks.

Your high school student can earn college credit for the special price of $200.

If you know some students interested in programs like these, contact Peter, Justin, or Russ today.

Okay, so we're back and Peter you had some revisions on your investment stuff on kind of what these numbers grow to

I was only off by zero so that's one zero so it's 13 million and by by year 60 and the parameters for that are your parents contribute $5,000 per year for 18 years and then after that I'm assuming you leave it alone just never contributes that account again after you turn 60 years old you had another 42 years 40 45 after 18 yeah 45

You're running it to 65?

60 years old.

Oh, 60.

Yeah, yeah.

So, since 59 and a half is the cutoff or whatever.

We could go further if we wanted to get retirement.

All right.

But 13 million bucks.

That's a better retirement account that I envision I'm going to have.

And, you know, again, not every parent can afford this.

If they can afford $10,000 a year, then you're going to set your child up for retirement or to waste a lot of money, which is always the concern, but hopefully the education that you provide them helps them not do that.

So, the one thing that

This adds, like you were saying, more than marketing to me.

There's lots of very wealthy rich people, high income and high wealth people that want more financial literacy.

Like they think the government, the social security and retirements is a huge burden on society.

They see them, they were successful investing, starting businesses, whatever they've done in their life.

I think there's a lot more Michael Dells.

Now, there's not as many people that are as wealthy as Michael Dell.

I don't know what his net worth is, but I'm guessing it's well over a hundred billion.

But the gift of six billion dollars is huge.

And I think there'll be lots of people there.

My point is, if we keep this thing privately funded, and I'd like it to be by law, I don't want one dollar of government spending.

I'm really against it if there's one dollar of

federal money going towards this.

So that's where I stand on that.

Privately funded, I'm 110%.

I love it.

I think it's the best thing since sliced bread, but I don't want to see $1 of federal money going into it.

All right, Justin, what do you got?

Well, congratulations Russ.

You should be against it then because we all know what's going to happen is that if it starts out privately funded and it's supposed to run out at what year?

That I don't know.

Didn't you say it was guaranteed through

like 2026 or something?

about 35.

So there's a short-term run out and then there's a long-term run out.

With 2035, I think it's the long-term run out.

Great.

Well, let me introduce you to the left campaign slogan for whatever

36 is going

to be.

It's just going to be, we continue funding this and we have to do it with public

money.

It won't

be fair.

So it seems impossible to me that we get this in privately funded and expect it to stay private.

Yeah.

Privately funded.

If it gets in, it's going to be in perpetuity and it's going to be publicly funded eventually.

Yeah, you're right.

Even if we have a law that says it has to be privately funded, there'll be new Democrats in office or Republicans for that matter too.

Yeah.

It's a great talking point to get votes.

And so in some ways, this is no similar to what we talked about on the previous podcast about the government getting in the way and crowding out.

If there was a way to have a hard and fast rule that it cannot be

funded with federal dollars and it has to be private.

All these rich people would step up because they know that the government is not going to fill the void.

But Dr. Clark, I'm with you.

I think this is just one of those things that it's inevitable.

Milton Friedman once said, you know, can a cat bark?

And so what he was getting at in the context of when he said that was that in the political economy, the cat is never going to bark.

And same thing, the

the government is not going to get smaller, the government's not going to intervene.

I think he would say the same thing here, so I think you're spot on.

Yeah, so I do want to offer some back of the envelope on why this system, in my view, would be a little bit better than social security.

So real quick, I have to find out.

So we've got 3.6 million babies born in the US each year, and we are spending $1.5 trillion on social security each year.

And so

I don't know what the total amount of payout for Social Security is over a person's lifetime on average.

I would want those numbers to be like extra sure here.

But here's the point that I'm laying out is if we take that $1.5 trillion in spending that we do per year on Social Security, and instead of giving it to the older people who are currently retired, you give that to a child at the beginning of their life.

So $3.6 million, you've got $1.5 trillion.

I don't know, how does that work out in terms of number?

I was trying

to get

that, but yes.

The three million babies, a thousand each, right?

Yeah.

Yeah, so that gives us R. Well, three, this is just three billion.

Yeah, duh, I guess I'm not really thinking straight.

That's just.

You said three million births three point five million or about a thousand dollars to each one is three billion.

You just had three zeros.

Yeah, so a thousand dollars sorry

listeners I'm usually faster with my math and that So you're finding that that would be a thousand dollars to each person would be three billion dollars.

Yeah Well, and then you can go up to one point five trillion And so that actually brings out a number and if I maybe I did the math wrong dress you can type it into you, but I'm getting four hundred twenty eight thousand

for per person.

That sounds high to me, so it's not like I feel low.

What I did is I took the 1.5 trillion and I divided by the three.

Yeah, let's not get too hung up because I think we're back to Justin's point that.

It's never gonna replace a lot of programs.

I do want to get hung up for just a second Which is that like that's I'm wrong by a zero here.

Let's say it's 42,000 out of 428 $42,000 at the beginning of a person's life that just stays in an account and an account until they're retired That gets us again pretty near to that number.

I was talking about which is like 13 trillion Yeah, imagine everybody in the country having 13 trillion dollars by the time they're retirement age You could even make it a rule that you're not allowed to cash it out till you retire, right?

Well, that's what

I said

the social security

exactly this would have to be built as social security replacement you can't touch it obviously if you die some way you know there'd be different rules but yeah I would I would be that would be another way to explore funding

So security, yes.

So ultimately what this would... Retire my program that works, I guess.

Fixing this would be a way to start to address fixing this.

So if you decide 13 million is like way more money than is necessary to retire, which it probably is.

I think most people could retire on like 4 million.

It depends on where you live and all that, but that'd be my roundabout guess.

Well,

now remember, you were contributing 5,000 per year on that.

Yeah, but 5,000 times 5,000 times 18 is about 90 and my number showing 428.

So even the one time 428 is more than the 5,000.

But regardless, ultimately what I'm saying is you could cut that.

cost of 1.5 trillion down to adjust to whatever number you think people need to end with.

I think we would end up spending less and having more total income for our retirees.

Now, it's never gonna happen.

It's never gonna happen because AARP doesn't want this to happen and they're gonna tell their voters, even if the voters are promised to be grandfathered in, they're still gonna tell them they're gonna take away your social security benefits.

So, no matter what happens, as Justin stated,

We're not actually gonna get this.

It would be objectively a better system, like, mathematically.

It would be positive some to do this.

I bet you could even grandfather the people in and it would still pay itself back after a certain number of years.

The bigger problem you haven't addressed is that the existing system has to play out.

Yeah.

So we're gonna continue doing what we're doing.

And then we're

adding.

I bet this would still pay for itself based on how much more expensive.

That's what privatizing Social Security has been talked about.

That's basically what we're doing is we're allowing you to invest in the market rather than the traditional Social Security has always been a transfer program.

There used to be

30 young people supporting one old person and now it's down to three or so.

And so

that's where the unsustainability of the current social security is where it's at.

The latest estimate I heard is the social security time bomb blows up in 2032.

I mean, we are real close to that.

Raising taxes.

Which is really close to raising taxes.

Exactly.

Raising, well, for sure raising retirement age, which there are arguments for that.

I'm fearful

that that's terrible.

I hope that's the result.

I think the result is they're going to make the taxpayer eat all of it.

That is my expectation

is that

your social security taxes are going to go up really significantly to cover this and the age of retirement is going to stay exactly the same.

I hope I'm wrong about that because that would be

a massive problem for people who are, you know, middle class right now.

It would push the middle class into poverty if we did this.

But yeah, so ultimately, my take on the Trump account, it's kind of like a cool experiment, maybe.

It might work to make people like a little bit smarter financially in theory.

There's a massive downside risk of this becoming a tag along to social security.

It will.

Yeah, and the $1,000

payments.

Yeah, a new game to play with.

So it's going the opposite of shrinking government.

That's why I said I'm adamantly opposed unless it was privately.

But then Justin's making me think, well, maybe that's not good enough either because the law will just change in the future.

But well,

I do like it was

all privately funded.

It's it's the most awesome program I've heard of in a long time.

I do like the idea of someone being able to have a retirement account that they are not a retirement, a investment account that they don't have penalties for taking out before 59 and a half for things like a house and education.

I do like that.

Yeah.

Actually, I think it should be for everything, not just housing education.

But I know that that's not saleable.

Yeah, I mean, I think Russ is exactly right.

Like, you know, can the cat bark?

I mean, this is where we're at right now.

No, the cat can't bark.

The cat can only meow.

And so the government's going to meow this into a program that costs the taxpayers a lot of money.

And if you're really financially smart, you might even end up benefiting from this.

Unfortunately, it's going to be regressive, I think.

I think the poorest people are going to be the ones who they're both going to bear a small amount of the burden, but they're also not going to get much of a benefit.

The middle class will probably bear the majority of the benefit, and some of them will get it, some won't.

And then rich people are going to get these free paychecks that their kids are going to be able to earn.

Yeah, exactly.

13 more million more.

I will say there is an exemption right away.

It seemed like it was fairly high, but I think income earners above

150?

Maybe it was even higher than that.

But there is an exemption that you can't have the Trump account if you're already, I assume it's based off income.

But

yeah, there was something

there.

So they're trying to do that.

But like you say, people who are financially literate and well off are already aware of the college fund program, the education fund programs.

We could get into health savings accounts is kind of similar where there's lots of ways to get

tax benefits by putting it in the right bucket.

So the government has a number of these programs.

This is probably just another one.

The one highlight, like you said, is the marketing that if we could raise financial literacy and people could see that money grow over time, there are some benefits there.

But doggone it, it has to stay private.

Why can't we ever have a private solution?

Why do we fall back on the government safety net or the government provision of something?

It's just a move towards socialism, people.

We can't do it.

What is so bad about taking Michael Dell's awesome?

Totally.

I mean, $6 billion?

People, listeners, I like to do this with my students.

That's $6,000 million.

That's more than I make in a

year.

Well, I don't know, but maybe some of your Bitcoin holdings.

He lost all those.

Yes.

So, yeah, $6,000 million.

I mean, that's $6,000.

It's just mind-boggling.

So there is a lot of people that can be funded just off Michael Delskiff.

And what I'm saying is that there's oodles of rich people that will support this.

Oodles.

I bet we could totally privatize this and make it work.

You're talking about a sovereign wealth fund, essentially.

Privately funded sovereign

wealth fund.

That's the part that I liked about it, that, OK, I get how Trump has to be involved or put his name on something to get the same way we treat these other tax-benefit vehicles.

Gosh, that's such a great idea.

And then the political economy, like Justin said, is going to wreck it and make us all worse off for it.

And that's not even with the kids squandering it.

So that's that's less of an issue.

If it's privately funded, then, you know, then the squander away.

Back to investing in Justin's Vaporama.

The vapor rum I've often said that if I were a moral moral man, I would not be buying index funds I would be putting all my money right now into draft kinks I'm a firm believer that if you put all your money there, you will beat the stock market over the next 30 years I'm not gonna do it myself and I tell myself it's because of morality Maybe it's actually because that's out of prudence, but I do yeah I I agree with Justin that the moral hazard here is pretty significant, too Well, maybe that that's maybe not technically the right term for whatever is happening, but there there's

Unfortunately, there's going to be a lot of spending

and a slope of big government.

evolving and eventually Goliath taking it over.

Which by the one other thing that actually just pops into my head is it's funny that this is being talked about as a way to improve the housing market when obviously the result of this is going to be higher housing prices, right?

Like we are going to give you this money and you're only allowed to use it if you buy a house.

So on the margin, what are people going to do by bigger house?

The same way

low

interest subsidized interest and the demand just goes up and the housing prices bubble.

Previously, I was going to put two percent

on a $400,000 house.

Now I'm gonna put 4% down on my $800,000 house, right?

Unfortunately, this is a nightmare for the Ramsey world.

Not a moving person.

And

I

actually think this will be worse for the housing market than it will be good.

Again, I think if you finagle it right, you will be okay.

But I think there's a lot of people who won't be able to finagle it right, who are just gonna face no money in their accounts and higher housing prices because essentially we are increasing the relative house of pricing by making it a more attractive good spot.

To

romanticize this,

into buy a house and go to college and or start a business is just I think the squander factor is going to be huge too.

Yeah.

Yeah.

All right.

Well, this has been a production of the Gorton Institute here at Otto University.

I'd like to thank you all for listening.

Five star rating helps other people find us and otherwise be fruitful multiply.

Thanks.

If

you're enjoying this KXEL podcast, then we invite you to listen to KXEL's great programming in real time too!

You can hear us on the radio, statewide at AM 1540 and in the Cedar Valley at FM 100.5.

We stream live on the web, not only through KXEL.com, but also through our free KXEL mobile app.

And Alexa knows how to find us too.

It's where Iowa comes to talk, News Talk 1540, KXEL.

Saturday morning here on KXEL America's original blowtorch America's first 50,000 watt clear channel broadcaster right out of Waterloo Cedar Rapids 1540 100.5 and listen live KXEL guys the Jacobson report this morning on Saturday as always we do our business salute and again the great people

at Hames Homes, back with us for an encore, part of that multi-generational family of leaders who bring us safe, affordable, beautiful homes in our community manufactured homes.

Clint, you're back for an encore.

You did so well last week.

Welcome back to the show Clint Hames.

Thank you for having me back.

I'm looking forward to talking with

you.

Absolutely.

Well, Clant Summit View and Grand View is almost like two little cities in the beautiful southwest part of Cedar Rapids, a pastoral setting with farm landscapes of the background and yet close to the airport, close to retail.

How ideally are you guys situated for these nice little communities?

Well, we're close to close to all the shopping centers.

So we've got Walmart, Target, and then I'm

Everything is really close by, fairway, all the amenities.

Sudrapp is building a beautiful library, just a couple blocks from us here.

So there's access to about anything you can pick up.

Guys, these are beautiful manufactured homes.

When I drive through your two communities, Clint, these look like...

you know, regular homes.

We've come a long, long way from the beginning of the industry when these were referred to as mobile homes.

These are such fine quality craftsmen construction and sturdiness that when Cedar Rapids was hit by that horrific derecho half a decade ago, your unit stayed completely intact.

That's right.

I mean, homeowners had some of the traditional stuff like siding, gingles.

Maybe a couple windows here and there, but nothing different than what you would have had in a real estate home elsewhere in town.

You know, you've got this wonderful website, hamshomes.com, H-A-M-E-S-H-O-M-E-S dot com, hams, the homes people.

And your listings, there's something for everybody here, Clint.

You've got for 37, nine, a nice three bed, two bath, just under a thousand square feet, mid range for just,

under 90,000 at 89.9, you've got a four bed two bath, 1200 plus square feet.

And then you've also got for 169.9, a four bed two bath, almost 2500 square feet.

These are spacious, beautiful, comfortable homes and on nice lots.

Absolutely.

There's plenty of space for a garage.

If you want to add a garage, some home sites already have a garage on them.

There's usually a utility shed that comes with a home, a big deck on a lot of the homes.

I mean, there's a little bit of something for everyone, whether you're downsizing or you're just getting started in life.

There's just a lot to like with our current inventory.

Yeah, guys, we love Haymes homes.

Spacious, attractive, manufactured home communities.

You're going to find old fashioned community spirit.

there quiet safe neighborhoods where folks have a quick friendly smile and wave and also you guys do so much for the community and so much for your residential areas there you've got dog parks frisbee golf in the area you've got a pantry you guys really are community stewards Clint Haymes

Yeah, most certainly are.

We have a couple senior groups that get together.

We've got a Friday morning breakfast, walking trails, playgrounds for the kids, the school bus picks all the kids up throughout both caddies.

Again, just like the homes you have available, our communities have a lot to offer as well.

Well, they talk about the triple option football.

You guys have the triple option for lifestyle.

You've got beautiful units there for 55 plus aged people like my wife, Deborah and me.

You've got homes for downsizing.

You've got homes for young families and you know Deb and I have been downsizing.

It's just great and you're close to even Iowa City if you want to be there.

Let's talk brass tacks about the money.

You know sometimes buying a home is a hassle but Clint with you guys, you guys are ready to even work out financing and insurance.

Most certainly we've got a financing application on our website.

You can make an appointment to me with myself or Curtis here in our office.

And we have lending partners that we work with every day that would be ready to take on many new applicants.

And you guys also buy homes.

People can sell their manufactured or mobile homes.

That's right.

Right now we are a little limited because both of our communities are completely full, but the homeowners that live here, they've got a couple of different options on selling their home and selling it back to us is certainly one of them.

You know, what really amazes me is how loyal your folks are in terms of what they say about you guys on the website.

Let's talk about how folks can get

in touch with you by website, by phone, by Facebook, and by driving by, Clint.

Absolutely.

We'd love to hear from anyone.

Our phone number here is 319-377-463.

You can find all of our inventory, tons of information about our communities at hemeshomes.com.

We can be reached by email by sales at hemeshomes.com, or you can come visit us here at the office.

We're located at

5410 Wabash Street, Southwest, in Cedar Rapids, Iowa.

And guys, people just swear by the great folks at Hames.

Tara Tudine says, one of my biggest dreams for my family was to own my own home and have a yard for my kids and just let loose and be kids.

Thanks to Hames, that is all coming true.

Terrence and Patricia say, we would be honored to recommend Hames to...

anyone.

And Jim Hunt says, I've received nothing but great help and advice from Kelly and Becky.

You can tell they love their jobs.

And the Zons say, Grandview is a clean, well-kept and safe community.

Problems that may arise or handle promptly, courageously and efficiently.

Management has always been very helpful and polite.

I mean, these accolades go on and on.

Zach, remind me, Grandview is a nice, clean place and the Balmers

Chris and Mickey, we really are enjoying our new home.

Thanks to Hames for making it all possible for us.

You know, that's a testimonial when your people there say such good things about you guys.

Most certainly is and we just have a fabulous staff everybody's been here a long time So they've spent that time getting to know our homeowners and we're still one of the locally owned Communities and so we're able to give back and reach out to

well as John and Bobby O'Brien say you can tell that people care about their homes and Gabby Galloway says great community and a great place to live and so guys I

Go over and see these folks here in Southwest Cedar Rapids.

Clint is always great talking to you as well as to Barbara and Curtis.

You guys really are a multi-generational family that it's hard to believe you can continue to improve upon the legacy of Founders Kurt Norma Hames, but you guys have taken it to yet another higher level.

Yes, they certainly said set us up for success here and we're going to carry on that mission.

All right guys, we'll get ahold of our friends at Hames Homes guys.

Every week here we are delighted.

to have them on our program.

Go see them there at 5410 Wabash in Cedar Rapids on the corner of Wilson and West Post Road.

Go to their website, hamshomes.com.

Call them at that great Marion Legacy number at 319-377-4863 or catch them on Facebook.

And when you call, they can ask for the man.

They can ask for you right away.

They can talk to Clint Hames, right Clint?

I hope you do.

All right, guys, well, we'll have Clint back soon along with Barbara and Curtis.

Thanks again for joining us today, Clint.

And stay warm.

Winter is only got six weeks left.

We've had a fairly mild winter.

We can grind out these last six weeks and then we're into March.

And

go Hawks.

Clint Hames, ladies and gentlemen.

And we will be back on the mighty blowtorch KXEL.

What a loose rap is in just a moment.

Economics is the study of human choice in the world we live.

Faith is confidence in what we hope for and assurance about what we do not see.

By investigating faith in economics, we can learn how they lead to human flourishing.

This is the Faith in Economics podcast, a presentation of the Gortney Institute at Ottawa University.

Welcome to our show today.

My name is Peter Jacobson.

I'm the Gortney Professor of Economic Education and Research here.

Joining us, we have Dr. Justin Clark, the Menard Family Professor of Philosophy and Ethics, and also, in showing our show, we have Dr. Russ McCullough, the founder of the Gorton Institute and the Wayne Angel Chair of Economics here at Ottawa University.

All right, well, how many of you listeners were held up at the airport with the latest government shutdown?

There's a lot of grief and anguish and money lost in a variety of ways during the government shutdown, so it's just...

to me was just a classic case of government failure on how big of an impact that could ultimately have for all the reasons it did it really all points to them not being able to pass something through legislation and the bad news is we've got another one coming up I believe it's end of January sometimes so so I felt compelled to uh

Send a letter, an op-ed piece to the Wall Street Journal.

I don't know if it's gonna be published or not.

I guess we'll find out by this, but I'll try to get it out to some other outlets.

And I thought it'd be fun to talk about it today.

Being an economist, I'm always thinking, oh gosh, there's losses on both sides.

Nobody's happy between consumers, people who are the air travelers and then the people working for the air traffic control and the TSA.

And then of course, the airlines themselves that had to change things around.

So wouldn't there be a way to make things better?

Wouldn't there be some way to have people come together on this?

So here's the idea that popped in my head.

Why wouldn't the airlines be able to create a fund together that would loan money short term, very short term to the workers who were required to show up to work but weren't going to get paid until the government opened up again?

So we have this

There was different categories of people, so I'm specifically talking about like the air traffic controllers and TSA agents where they were for sure going to get paid, they just have a deferment.

And you hear about, oh, when this was being talked about on the media that people do go to their banks and, you know, get short-term loans, but not everybody's in the same position to have that lending facility there or...

put it on a credit card or whatever, you know, go to other sources.

So why not have a unified place where people could go for a loan?

And so the millions of dollars that were lost by the airline industries, I thought, well, shoot, they could probably give them an interest-free loan and still be ahead.

Well, to my surprise, it was even more ahead than I thought it was going to be.

After starting to do the work, I learned Delta Airlines reported losing $200 million.

And so I started thinking, well, jeez, if that was 200 million, I wonder how much it would actually be to cover paychecks.

So I went and looked at how many people were out of employment.

And so I found an article.

This is all just simple Google searches.

To be honest, I didn't go through and vet them super carefully.

which I'll just leave it to the people if they want to advance this further to do, but there were 60,000 people.

Average paycheck from the government, which again, might be, I'm thinking a little high, but $4,700 every two weeks was the just blanket average of government employees, which like I said, that might be higher than the 60,000 people we're talking about.

So if the Delta and other major airlines and other airlines were able to

Pony up some dough to use for payday loans, essentially, where they would be paid back as soon as the government opened up.

This was the longest shutdown in history, 43 days.

So we have, if they would pony up three pay periods worth of money, that ends up being about 15,000 per employee.

15,000 times 60,000 gets us to this 114,000, I'm sorry, yes, 114 million is 820 million total for

to cover all of the paychecks.

I'll come back to the 114.

Sorry, I probably should have my article open.

So that would be an $820 million to cover three weeks worth of paychecks for all these 60,000 people.

So then, you know, how would it be allocated?

I thought you need to come up with some sort of simple rule to know how much each airline should pony up for this.

So what I did is I looked at the average number of flights in a month.

And so they're currently, the FAA reported 43,000 per day.

And so I extrapolated that out to a month.

And I think we were in the million, over a million flights in a given month.

And Delta is 180,000 of those flights on average.

And so the other major airlines were very similar to that, American Airlines Southwest.

So 180,000 Delta flights means that they represent 13.5% of the total flights going out in an average month.

And so they would pony up 13.5% of the 820 million, which is the 114 million I accidentally blurted out earlier.

So already them putting 114 up is less than the 200 million that they lost.

So keep that in mind.

So now there's a opportunity cost of their money.

So I just again somewhat arbitrarily said 6%.

And so lost interest would end up being about $800,000 if you take six weeks worth of lost interest at 6% on Delta's 114 million.

talking $800,000.

And so if everything went smoothly, where they made a payday loan, the people paid it back when the paycheck came in, because they're going to get exactly the paycheck is their amount of the loan, and then that exact amount comes in their paycheck once the government opens up, then that loan is immediately paid back, and all of the airlines are made whole.

from the funds that were in the account.

They get their 13.5% back of whatever funds remain in the account.

So that is, if it ended up being $800,000 of opportunity costs, it's losing $800,000 versus the reported losses of $200 million.

Kind of a no-brainer.

And plenty of room for wiggling on Russ's back of the envelope numbers.

Conceptually, I think

think this could work and I don't even think all airlines would have to necessarily participate to make it work like there's there's many ways that this I think come together again if people defaulted on the loan didn't pay back their loan right away the normal recourse would be there for collections and other things but I think this really has some potential

to make everyone's life a lot easier.

So you add up Delta saving 200 million and the other airlines being maybe somewhere around there, you're probably approaching a billion dollars pretty quickly.

And so I called this the billion dollar idea because then you quickly get over a billion when you add in the air travelers cost of extra restaurant meals, delays, canceled trips, canceled business deals, all of the pain and anguish if you put the non-monetary suffering.

and estimate it, I think we're easily over a billion.

So let me pause there.

That's conceptually what I was thinking.

And I love the idea in that it doesn't require government bureaucrats or politicians to sanction it or to bless it.

At least I don't think so.

Maybe there is some legal thing since their paychecks are coming from the government that there'd have to be something.

So that would have to be explored.

But it's basically a private solution to this problem.

Yeah, I think your last point there is where I want to hit.

So first off, I do believe that it's possible that there are solutions like Ruses on the table and that this actually might be one of them.

I think the first step is thinking, why might not this already happen?

Now, for the record, some economists would say,

In the extreme that this won't work and the reason won't work is because it hasn't been done already.

Right.

And people did that to Julian Simon when he proposed the reverse auction system for airlines.

So I don't think that that's a good route to go as an absolute but I do think that there's value in asking the question well why hasn't this been done.

Yeah.

And so we to answer that question.

you either need to, you can need to locate one of two things.

You need to locate either like a switching or information costs that makes this very difficult for someone to come up with or to implement or something like that.

So that's possible.

And if that's true, then like, if it's an information cost, then Russ's article actually fixes that.

And so you like, maybe it becomes viable now.

But then another question is, is there somebody who actually benefits from this?

In other words, is there a vested interest in the way that the government shutdown does this?

or results in this.

And so a really easy and I think wrong story.

Oh, Justin, you got something.

Are you saying is there someone who benefits from shutdowns when they occur or is there somebody that would benefit from Russ's proposal?

No, I'm saying is there somebody who would benefit from a shutdown impacting air traffic controllers?

In other words, is it is it good for someone that the air traffic controllers cannot fulfill their job or aren't paid or whatever?

Because if it is, then maybe that's why a Russ's solution does seem like it seems like a Pareto improvement, which is Russ's really good point is that like it's a win-win-win.

Everybody wins.

The airline loses less money, so they win.

Their traffic controllers continue to get paid.

They win.

The government doesn't have to be responsible for flights getting delayed, so they win.

It is a no-loser situation.

That's kind of the interesting part about the proposal.

In economics, it's rare to have no-loser proposals in a functioning economy, but it does happen, and I agree with what it does happen.

But it usually happens because of government.

Yeah, it caused it.

So then the question is, well, actually, is there somebody who would lose from this solution?

In other words, another way of saying that is, is there somebody who gains from the air traffic controllers being out of work?

I can think of one group, maybe, that that's the case of.

So the first question is, does the executive branch lose by Russ's proposal here?

And here's maybe why they would.

And I'm not saying for sure.

And I think we could argue other groups too.

But in my frame, the way I approach the government shutdown thing is, government shutdowns are a cost imposed mostly on the executive branch, I think.

Because the legislative branch, I don't know if they directly benefit, but like they don't seem too concerned about getting through it like they actually get vacation time like it doesn't seem to like it's a situation where no individual person loses credibility because Congress is already so unfavorable anyways that like it doesn't seem to really affect their electability and everybody goes through it at once so it's not like okay one cop so I think the spread yeah the legend the legislature doesn't seem to care but the president does lose time especially

when you have the situation we have right now, where Trump is the president of a party who has the majority in the legislature.

And so he's literally his days take away during shutdowns, his days to get things done and through the legislature.

And so it could be the case that the executive would want the FAA to have the air traffic controllers subject to the government shutdown.

So that way, when there's a shutdown, there is public pressure to end the shutdown.

That's possible.

And by the way, I'm not saying the president is smart enough to figure that out.

What I'm saying is an institution controlled by the president would evolve in that direction.

They would evolve in a way that there would be some sort of backstop to prevent shutdowns from carrying on forever.

And as far as I know, the FAA is under the president's discretion pretty significantly.

So that's a possibility.

I don't think that that debunks for us, because like I said,

before.

I don't think that we live in a world with zero $20 bills on the sidewalk.

I think there has to be profit opportunities out there.

But that's my best stab at like, who could be benefiting?

And by the way, even if that is true, that doesn't mean Russ's solution isn't good.

It still actually would be good for the public if this was adopted.

It's just would be an explanation for like, what is standing in the way?

Like, why haven't we done this yet?

It might be because the president doesn't want this to happen.

And I do agree with Russ that at the end of the day,

I bet there is some sort of like legal issue like that because these are government employees even though you would think that the government would love to accept this free essentially free money from the airlines.

pay their workers with this interest-free loan, essentially.

If it was interest-free, they would look really bad

from a public standpoint.

Unfortunately, you've got some stupid law standing

in the way.

Unfortunately, the government does that all the time, right?

Like, the government all the time will be like, oh, like, if I imagine, you know, just for a second that, like, I need to do something at 505 in my local municipal office.

And I say, hey, if you all stay an extra, you know, 10 minutes, I will pay you each $1,000.

The people would probably take that deal.

I would take that deal.

It would benefit the government on net because then in theory, like I'm compensating for like a significant amount of their wages, but we all know that the government would not allow that to happen, right?

Like that would go to some manager in some office who would say, we're legally not allowed to stay open 10 minutes for $1,000.

And maybe there's good reasons for that.

You could make arguments about white bread.

But the whole point being, I think Russ, your instinct is right that there's probably some legal challenge, but that could be overcome, right?

That's endogenous to your article.

Like

you could maybe make a law that would fix that.

And then I think if

there is something like that, some sort of challenge.

I think the reason it exists is because the executive branch kind of evolves to this level of stopping the government shutdowns.

Well, this looks like a good spot for a break.

And Justin's got something to say.

I've got some something to say.

And I kind of lost a little bit of your argument that I'd like you to clean up with the benefits or harm to the president.

So there was something that was just a little came away a little bit unclear on.

So we'll pick up from there in just a bit.

Ottawa University has an exciting new major.

PPE, which stands for philosophy, politics, and economics.

Each of these three fields is interesting in their own right, but they intersect in ways that are important to understand, both individually and for your community.

If you find philosophy fascinating but want to make sure that your study of the subject is practical, if you enjoy economic analysis but want to see how economic laws interact with moral principles, if you are interested in politics but want to explore how economic and ethical realities constrain our political choices,

You should consider the PPE program at Ottawa University.

The Gordon Institute at Ottawa University is the best place in the Midwest for free enterprise education and its contribution to human flourishing, faith, and economics in action.

We have some great high school student programs like PPE Fest.

This is an event where students get to listen to some world-renowned speakers and then participate in competition geared around philosophy, politics, and economics.

Our everyday economics program is just a half day on a Saturday

and we will have an integrated discussion about common sense economics.

We have a college credit microeconomics course that runs every eight weeks.

Your high school student can earn college credit for the special price of $200.

If you know some students interested in programs like these, contact Peter, Justin, or Russ today.

Okay, so we're back.

Gator, you're bringing up some good points there on who benefits or who gets hurt, you know, from the shutdown outside of the airline that might perpetuate and not come to solutions.

All right, well, any other last words?

Otherwise, this looks like a decent spot to rap.

Yeah, let's call it.

All right.

Well, this has been a production of the Gorton Institute here at Ottawa University.

I'd like to thank you all for listening.

Five Star Rating helps other people find us.

Otherwise, just pass this along to friends and family that might like to take a listen.

Other than that, be fruitful, multiply.

Thanks.

The End

Thanks again, guys.

Tell your friends about the podcast, kxel.com slash Jacobson, J-A-C-O-B-S-E-N.

In the meantime, listen to all the wisdom of Jeff Stein during his weekday news and commentary, and folks, always remember and never forget to be safe, be smart, be good, be strong, love Jesus Christ, and God bless us.

everyone till we meet again have a great weekend and bye bye