This is a rush transcript from "Glenn Beck," April 7, 2009. This copy may not be in its final form and may be updated.

GLENN BECK, HOST: OK, we have Niall Ferguson here. He's a Harvard professor, author of "The Ascent of Money."

This is the dumbest show you've ever been on, isn't it?


BECK: Wow.

FERGUSON: There are many dumber shows on television.


BECK: Wow. You have to write them down. I haven't seen them!

OK. I want to read you a couple of quotes here. You tell me what this — tell me what this sounds like.

Russian government pledged more than $1 billion in state support to its ailing car industry in a bid to avoid heavy job losses and potential social unrest as the once booming car market contracted 60 percent this year. The government in Russia is backing a "no-layoff" policy in spite of tumbling demand for the products. And a sheet metal worker says he understood the factory's troubles last year when he bought a new Lada, only to discover the horn and heater didn't work and the belt squeaked.

Oh, I don't know about that last one. But what do the first two sound like?

Do they sound like the same kind of policies anywhere else?

FERGUSON: It actually reminds me of what happened in the 1970s when I was growing up in Britain, because there used to be a car industry in Britain, of course, that lost money. It was tremendously inefficient. And the Labour politicians then, the socialist politicians then, said, "We can't possibly let these companies go to the wall." So, billions of pounds were pumped into the British automobile industry.

Of course, it was completely down in the tubes. It didn't turn the industry around. And finally, these various companies of which nobody has now heard, like British Leyland, vanished without a trace. Now, there are still some manufacturing sectors in the United Kingdom, but they are mostly foreign owned that.

And I think that's really the lesson for the United States. You can build cars very efficiently in this country, but you need to be Toyota. General Motors can't do it, nor can Chrysler.

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BECK: And I'll tell you, this really bothers me, because I bought into a lie for a very long time, up until probably the last five, six, seven years that, you know, buying American — OK, well, they're employing, you know, American workers to build Honda or whatever, they're employing... but the money goes offshore. It doesn't — we have to own things. We have to be able to build things ourselves. We are becoming worker bees for the rest of the world.

FERGUSON: Well, I'd rather invest in Toyota than in General Motors. And it seems to me, from that point of view, it doesn't particularly matter which brand of car you buy. You want to buy the best car for the best price.

BECK: Yes.

FERGUSON: That's the free market, Glenn. You can't preferential buy an American car even though it's more expensive and less well-made than a Japanese car.

That's the beginning of your path to socialism, the day you start giving preferential treatment to inefficient carmakers just because they're American. Don't go there.

BECK: So, let me give you a couple of things here. Brand new FOX News Opinion Dynamics poll: More qualified to manage a U.S. business, business executives — 51 percent, federal government — 21 percent. The next poll is, who is smarter? Corporate executives — 44, congressional leaders — 23, no difference — nineteen.

People know in their guts the government shouldn't be running this stuff, not even to say about the Constitution or anything else. Just — these guys are dopes. They can't run anything right.


BECK: Why does it still happen? Where any theory you must be — as a guy who studies economics and everything else, you must have been kept up at night and going, "What the hell is wrong with these people?"

FERGUSON: Well, you can acquire an empire in a fit of absence of mind, and you can also acquire a nationalized industry without quite meaning to. First you give them a bailout because you don't want them to go bust, and then you start worrying about the job losses if they go into bankruptcy. And the next thing you know, you say, well, we really have to have some say over how this is run, and after all, we are the government.

BECK: Right.

FERGUSON: We must know what we're doing.

So, suddenly you're in charge. Suddenly, you're making decisions about how the company is actually run. That is what is happening not only in the automobile sector but also in the financial sector as the big banks — particularly Bank of America and Citigroup — gradually become part of the federal government. It's the Amtrak-ization of the U.S. economy.

BECK: Which sucks.

FERGUSON: Yes, you want a Bank of Amtrak?

BECK: America, have you been on Amtrak?

FERGUSON: Right. And imagine an Amtrak car. That's what you're going to get.

BECK: No, no, no. No, I don't want to go there. I don't have my blankie.


BECK: OK. Do you think — do you think I'm wrong — my gut says that we are treading so close to financial disaster with the amount of spending, the debt and everything else, that you may not know what to do at this point, but if I looked at this as a ship, I would be saying to the captain, full stop. Just at least stop this ship from going any further. I'd like to reverse, but at least for a while, don't spend any more of this money.

FERGUSON: Well, it's an experiment to see if the United States is, in fact, a Latin American economy.

If you look at the Obama administration's budget, it forecasts that the debt will go up to $23 trillion, which is 100 percent of GDP by the time we get there.

BECK: Explain this. What does that mean to the average person? What would their life be? Compare us to a country, what is that?

FERGUSON: So, you're going to double the size of the federal debt. It's going to be equivalent to one year's output of the U.S. economy. And that means that the interest payments are going to become a larger and larger share of national income and of the federal budget.

Never mind the additional cost of Social Security and Medicare, pretty soon the entire budget is going to be consumed by debt payments, Medicare payments and Social Security payments. The defense budget will factually not exist. That is already factored in. That's baked into the cake of fiscal policy right now.

BECK: We don't — we didn't — we don't — Americans don't believe that. Americans when they hear George Soros says, "Your dollar is done, the U.S. currency, in time, is done." They just think, oh, no, it will do something.

There's nothing to do except inflate the money.

FERGUSON: This is the "Great Repression," not the Depression, but the Repression because Americans are in denial about what's happening. Forty-four percent of expenditures this year is going to be financed by borrowing. Forty-four percent of all federal outlays will come from borrowing. They are printing money like they never have before.

It's happening in a way almost as if World War II is being rerun but without the war. That is the scale of the debts at $1.75 trillion deficit. We haven't seen something like that since 1942 when we were fighting the Japanese.

BECK: Are you American?

FERGUSON: No, I'm not. And I speak with the experience of a Brit.

BECK: Yes.

FERGUSON: Remember, I've seen empires decline. I know what this is like.

BECK: He seems awfully touchy on that. No, I only wanted to ask you, I just wanted to ask you, so, are you afraid for your country. Do you fear for America's future if we don't wake up?

FERGUSON: Oh, yes. Absolutely. I've feared for it for some time.

BECK: Yes.

FERGUSON: I wrote a book called, "Colossus: The Rise and Fall of the American Empire" in 2004, saying debt will be the undoing of this country if Americans aren't careful.

It's not irreversible, Glenn. This country has fantastic natural spontaneous energy. Americans work harder.


FERGUSON: They believe in the market.

BECK: I know.

FERGUSON: What their government is doing is a major threat.

BECK: The name of the book again. I'm sorry I haven't read that.

FERGUSON: "The Colossus: The Rise and Fall of the American Empire."

BECK: The next time we meet, I will have read that. Thank you very much.

FERGUSON: I'm glad to hear it.

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