WEBVTT NOTE Why the Greenbackers Are Wrong 1 00:00:00.000 --> 00:00:15.000 Well, first of all, just so you know, I have this whole spiel written out and I'm only going to touch on a few of the points in it, but if you feel so moved by my presentation and you find yourself weeping at the end that it's over, 2 00:00:15.000 --> 00:00:27.000 I have the whole thing available online. I've made a special page that'd be easy to remember on my website. So it's tomwoods.com slash paper. That's where you can find it. So easy. 3 00:00:27.000 --> 00:00:43.000 Now I have had over the years intellectual opponents of various stripes and some of them have driven me crazy and others have forced me to re-examine my views and refine or even change them all together. 4 00:00:43.000 --> 00:00:51.000 And I have had opponents I have considered to be very honorable people. The philosopher Ed Faeser, for example, I think is an extremely smart guy. 5 00:00:51.000 --> 00:01:03.000 I'm a smart guy. He constantly makes me think. When I discuss things with him, I even sometimes think maybe I'm wrong. He is very persuasive and a gentleman. 6 00:01:03.000 --> 00:01:17.000 I haven't felt that way when dealing with the Greenbackers, however. So if it sounds like I'm just being gratuitously mean, I'm really going to try not to, even though if you could see the things that they said about me, good grief. 7 00:01:17.000 --> 00:01:47.000 Greenbackers, neo-Greenbackers, neo-Greenbackers, neo-Greenbackers, 8 00:01:47.000 --> 00:01:51.120 and more closely to what's being said, because these folks want to end the Fed because it's 9 00:01:51.120 --> 00:01:57.960 not inflationary enough, because the Fed is supposedly a private institution, so the Fed's 10 00:01:57.960 --> 00:02:03.480 problem evidently is that it's not socialistic enough for the greenbackers, and moreover 11 00:02:03.480 --> 00:02:11.320 that the Fed has this terrible problem, the whole banking system under the Fed creates 12 00:02:11.320 --> 00:02:13.960 problems that can't be solved. 13 00:02:13.960 --> 00:02:18.200 So for example, more debt is created than can be repaid. 14 00:02:18.200 --> 00:02:21.000 That when money is created, it enters the system 15 00:02:21.000 --> 00:02:22.960 in the form of debt. 16 00:02:22.960 --> 00:02:24.980 But at the same time, the amount of money 17 00:02:24.980 --> 00:02:27.320 that would be necessary to pay the interest on all that debt 18 00:02:27.320 --> 00:02:29.160 is not created. 19 00:02:29.160 --> 00:02:32.560 And so people are playing a game of musical chairs, 20 00:02:32.560 --> 00:02:34.560 where not everybody, by definition, 21 00:02:34.560 --> 00:02:35.960 mathematically it's impossible. 22 00:02:35.960 --> 00:02:39.040 Not everybody will be able to repay all the loans that 23 00:02:39.040 --> 00:02:41.080 have been contracted. 24 00:02:41.080 --> 00:02:55.400 And so the Greenbackers are folks who say what we need, therefore, is to get rid of the Fed, have the money issued directly by the government, and have the money be debt-free. 25 00:02:55.400 --> 00:02:57.400 Now, what do I mean by debt-free and debt-based money? 26 00:02:57.400 --> 00:02:58.600 I'll just explain this very quickly. 27 00:02:58.600 --> 00:03:02.880 When you read the Greenbackers, they're always using the phrase money as debt. 28 00:03:02.880 --> 00:03:07.840 And what they mean is that in this system that we have right now, which to me is not 29 00:03:07.840 --> 00:03:13.920 a, obviously a free market system, I could list half a dozen to a dozen ways that it's 30 00:03:13.920 --> 00:03:18.800 not a free market system, it's a cartel arrangement under a government-privileged central bank, 31 00:03:18.800 --> 00:03:23.480 but they refer to this as the private banking system that we have. 32 00:03:23.480 --> 00:03:27.220 Money is created by the commercial banks, not in the form of them literally printing 33 00:03:27.220 --> 00:03:30.300 up dollars and handing them to you when you take out a loan. 34 00:03:30.300 --> 00:03:34.780 They create the money digitally and they hand you your checking account little book and 35 00:03:34.780 --> 00:03:36.900 they say, here, we've just lent you $1,000. 36 00:03:36.900 --> 00:03:40.540 Here's your little passbook and it's got 1,000 written in it. 37 00:03:40.540 --> 00:03:42.720 And so they create money that way. 38 00:03:42.720 --> 00:03:45.620 But notice they lend me, so in other words, when they create money, they create in the 39 00:03:45.620 --> 00:03:46.940 form of a loan. 40 00:03:46.940 --> 00:03:48.620 They lend me $1,000. 41 00:03:48.620 --> 00:03:51.940 That's how the money is created in the form of a loan. 42 00:03:51.940 --> 00:03:57.060 But when I have to repay that money, you'll notice all they've created is the $1,000. 43 00:03:57.060 --> 00:04:01.580 They haven't created the $100 I'll have to pay if the interest rate is 10%. 44 00:04:01.580 --> 00:04:05.260 So I'm borrowing $1,000, but I have to repay $1,100. 45 00:04:05.260 --> 00:04:06.940 Where am I going to get the extra $100? 46 00:04:06.940 --> 00:04:07.940 That's their question. 47 00:04:07.940 --> 00:04:08.940 That's one of their questions. 48 00:04:08.940 --> 00:04:11.900 There are many reasons the Greenbackers are, I believe, wrong. 49 00:04:11.900 --> 00:04:17.620 I'm only dealing with a couple in the piece that I did and that I'm talking about today. 50 00:04:17.620 --> 00:04:22.260 And this is one of the problems with the Greenbackers, is that their problem is not really a problem 51 00:04:22.260 --> 00:04:25.660 and doesn't need to be solved, but I'm going to solve it anyway just to make them happy. 52 00:04:25.660 --> 00:04:34.020 And what they say is that you cannot answer their argument by saying, well, look, to earn 53 00:04:34.020 --> 00:04:37.540 the $100 to pay the interest on the loan, just work extra. 54 00:04:37.540 --> 00:04:42.940 Well, no, because the money that you would be earning by working extra itself entered 55 00:04:42.940 --> 00:04:48.380 the economy as a loan, and so, in effect, ultimately has to be repaid. 56 00:04:48.380 --> 00:04:53.860 So in other words, all the money is being created as loans, but the money for the interest 57 00:04:53.860 --> 00:04:55.420 is not created. 58 00:04:55.420 --> 00:04:59.460 So some of those loans can be repaid but others will have to go into default and the argument 59 00:04:59.460 --> 00:05:03.860 is this is just the way the private bankers want it so they can then come in and confiscate 60 00:05:03.860 --> 00:05:08.120 our property and eventually they're going to wind up with all the money. 61 00:05:08.120 --> 00:05:10.340 The bankers will wind up with all the money. 62 00:05:10.340 --> 00:05:16.860 Now you may say this sounds like a preposterous series of views but they are everywhere on 63 00:05:16.860 --> 00:05:17.860 the internet. 64 00:05:17.860 --> 00:05:21.660 They're absolutely everywhere and they are all over the end the Fed movement. 65 00:05:21.660 --> 00:05:25.060 So I thought, I think a lot of people are just saying well they're silly, I don't want 66 00:05:25.060 --> 00:05:44.180 I'm going to leave aside the lack of scholarly rigor in their work, but this is a major problem. 67 00:05:44.180 --> 00:05:51.280 The other day, somebody sent me a video made by greenbackers, and it's called All Wars 68 00:05:51.280 --> 00:05:53.680 are Bankers' Wars. 69 00:05:53.680 --> 00:05:55.840 You've got to watch this video, the person said. 70 00:05:55.840 --> 00:05:58.800 I thought, well, it sounds a little bit over the top, but I'll watch it. 71 00:05:58.800 --> 00:06:02.400 In the first three minutes, there were two quotations used. 72 00:06:02.400 --> 00:06:04.100 Both of them were fakes. 73 00:06:04.100 --> 00:06:06.620 One of them was a fake quotation by Ben Franklin. 74 00:06:06.620 --> 00:06:08.800 Another was a fake quotation by Rothschild. 75 00:06:08.800 --> 00:06:11.200 And I thought, why would I continue? 76 00:06:11.200 --> 00:06:12.600 Three minutes, there are two fake quotations. 77 00:06:12.600 --> 00:06:15.600 There are only quotations in the whole thing for the first three minutes. 78 00:06:15.600 --> 00:06:17.380 And they're both fake. 79 00:06:17.380 --> 00:06:18.940 And these quotations, all you have to do is go to Google. 80 00:06:18.940 --> 00:06:23.100 You find the only sources of these quotations are other greenbackers. 81 00:06:23.100 --> 00:06:26.420 There's no primary source ever. 82 00:06:26.420 --> 00:06:30.620 And they're always quoting the founding fathers talking about money and banking. 83 00:06:30.620 --> 00:06:34.460 Now, there's some great sound money statements by the founding fathers. 84 00:06:34.460 --> 00:06:38.980 But my piece of advice to the greenbackers when they're 85 00:06:38.980 --> 00:06:43.740 trying to use these old-timey, very prescient sounding quotations 86 00:06:43.740 --> 00:06:48.220 about the wickedness of banks is that if a statement about money and banking 87 00:06:48.220 --> 00:06:52.540 from Centuries Ago, sounds like it could have been written yesterday. 88 00:06:52.540 --> 00:06:55.580 It probably was. 89 00:06:55.580 --> 00:06:57.500 All right, so let's just go through this. 90 00:06:57.500 --> 00:07:01.740 First of all, is this claim that there's not enough money created 91 00:07:01.740 --> 00:07:05.300 to pay back the interest, only enough to pay back the principal? 92 00:07:05.300 --> 00:07:07.540 Well, let's consider the different monetary regimes 93 00:07:07.540 --> 00:07:08.380 we could live under. 94 00:07:08.380 --> 00:07:10.780 Let's suppose that we had a free market in money. 95 00:07:10.780 --> 00:07:13.180 Don't automatically assume there's government involvement. 96 00:07:13.180 --> 00:07:16.060 Suppose we had a genuine free market in money. 97 00:07:16.060 --> 00:07:18.020 Now, how that would work is a separate question. 98 00:07:18.020 --> 00:07:22.020 Let's just imagine the government is not involved at all, that money is created on the market. 99 00:07:22.020 --> 00:07:25.020 Well, we know that originally that is how money was created. 100 00:07:25.020 --> 00:07:29.020 So this isn't some fantasy scenario I'm contriving. 101 00:07:29.020 --> 00:07:36.020 We know this from the regression theorem, that money has to emerge as a commodity with a pre-existing use value. 102 00:07:36.020 --> 00:07:42.020 All right, well, that's how money comes onto the market under free conditions. 103 00:07:42.020 --> 00:07:45.020 Well, notice this money is not debt-based. 104 00:07:45.020 --> 00:07:49.380 The money that the market produces is a commodity with a pre-existing use value. 105 00:07:49.380 --> 00:07:50.380 It is not a debt. 106 00:07:50.380 --> 00:07:54.620 It is not the way a bank today creates money by creating a checking account balance for 107 00:07:54.620 --> 00:07:57.980 you in its computer and handing you the book. 108 00:07:57.980 --> 00:08:02.220 That is entering the economy in the form of a loan. 109 00:08:02.220 --> 00:08:07.940 But when gold enters the economy through gold mining, when a gold miner takes his gold to 110 00:08:07.940 --> 00:08:12.980 the mint to be minted into coins, there's no debt being created here. 111 00:08:12.980 --> 00:08:14.820 And the money just gets spent into the economy. 112 00:08:14.820 --> 00:08:17.580 has nothing to do with debt whatsoever. 113 00:08:17.580 --> 00:08:20.220 So the free market's money is debt-free money. 114 00:08:20.220 --> 00:08:22.500 This is what the greenbackers claim to want. 115 00:08:22.500 --> 00:08:27.780 There is no loan associated with the process of I'm a gold miner, I mine some gold, I take 116 00:08:27.780 --> 00:08:31.260 the gold to be minted and I spend those coins into the economy. 117 00:08:31.260 --> 00:08:34.540 Debt does not enter that process in any way. 118 00:08:34.540 --> 00:08:39.500 So there's no question of not enough money being created to pay back both the principal 119 00:08:39.500 --> 00:08:40.500 and the interest. 120 00:08:40.500 --> 00:08:42.020 There is no principal and interest. 121 00:08:42.020 --> 00:08:44.000 This is debt-free money. 122 00:08:44.000 --> 00:08:46.500 How come the Greenbackers don't want this? 123 00:08:46.500 --> 00:08:50.000 I suggest it's because what they really want is paper money, 124 00:08:50.000 --> 00:08:51.500 more than they want debt-free money. 125 00:08:51.500 --> 00:08:53.000 They want paper money. 126 00:08:53.000 --> 00:08:56.000 When I show them that free market hard money is debt-free money, 127 00:08:56.000 --> 00:08:57.500 they're not interested. 128 00:08:57.500 --> 00:08:58.500 No, how about that? 129 00:08:58.500 --> 00:09:00.500 Now, Bob Murphy was trying to calm me down by saying, 130 00:09:00.500 --> 00:09:02.500 well, maybe they just haven't thought it through enough. 131 00:09:02.500 --> 00:09:05.000 Maybe they don't realize the free market could create... 132 00:09:05.000 --> 00:09:07.000 Bob, you're so naive, Bob. 133 00:09:07.000 --> 00:09:08.500 Come on. 134 00:09:08.500 --> 00:09:10.500 These are just inflationists, incorrigibly. 135 00:09:10.500 --> 00:09:11.500 All right? 136 00:09:11.500 --> 00:09:13.500 Let's consider the classical gold standard 137 00:09:13.500 --> 00:09:20.100 Where you had a fractional reserve system, where not all the paper money was backed by gold. 138 00:09:20.100 --> 00:09:24.860 All right, well then you have some of the money substitutes that have the gold backing. 139 00:09:24.860 --> 00:09:26.820 They are not debt-based. 140 00:09:26.820 --> 00:09:31.340 They're just tradable instantly for gold, which is not any form of a debt. 141 00:09:31.340 --> 00:09:32.340 It's just gold. 142 00:09:32.340 --> 00:09:33.340 It's just a thing. 143 00:09:33.340 --> 00:09:34.760 There's no debt involved. 144 00:09:34.760 --> 00:09:41.020 So that portion of the paper money that is backing the gold is not debt-based and that's 145 00:09:41.020 --> 00:09:43.500 That's where your interest payments can come from. 146 00:09:43.500 --> 00:09:45.460 But what if you have a fiat system like we have now? 147 00:09:45.460 --> 00:09:49.460 I mean, doesn't it seem like they have a strong case here? 148 00:09:49.460 --> 00:09:53.140 Doesn't it seem like, indeed, there is all this money that's created into the economy. 149 00:09:53.140 --> 00:09:57.060 It's all created in the form of loans and yet not enough money is created to pay off 150 00:09:57.060 --> 00:09:58.060 the interest. 151 00:09:58.060 --> 00:10:01.280 Doesn't it seem like here, clearly, they must have something? 152 00:10:01.280 --> 00:10:06.620 But let's remember when we study Mises and then we study Rothbard's elaborations, we 153 00:10:06.620 --> 00:10:12.300 We notice that there is a pattern in how fiat money comes into existence into the economy. 154 00:10:12.300 --> 00:10:17.020 It doesn't just emerge spontaneously. It can't, for reasons that Rothbard and others have 155 00:10:17.020 --> 00:10:22.180 noted. It can't come about spontaneously. It has to come about in this basic way, that 156 00:10:22.180 --> 00:10:28.060 first the market yields you a commodity money. Then over time, for various reasons, people 157 00:10:28.060 --> 00:10:34.460 begin to use money substitutes that are immediately convertible into the money proper. And then 158 00:10:34.460 --> 00:10:38.460 And with the passage of time, people become acclimated to spending the money substitutes 159 00:10:38.460 --> 00:10:40.620 instead of the money proper. 160 00:10:40.620 --> 00:10:46.460 And then governments wind up taking the money proper, the backing, the gold away, and all 161 00:10:46.460 --> 00:10:49.460 you're left with is just the paper. 162 00:10:49.460 --> 00:10:53.600 And it continues to circulate because people now have an array of prices in terms of that 163 00:10:53.600 --> 00:10:57.460 money, and they can use it, and they use it out of habit. 164 00:10:57.460 --> 00:11:03.180 But what gave it the initial push was the fact that it began as a commodity money. 165 00:11:03.180 --> 00:11:10.180 Now, this is a pattern that Rothbard explains and even identifies in American history, of course, in what has government done to our money. 166 00:11:10.180 --> 00:11:20.180 Well, when the gold was confiscated from the American public in 1933, and people were given paper in exchange, this paper was not given to them in the form of a loan. 167 00:11:20.180 --> 00:11:25.180 It was just a one-for-one exchange of an amount of gold for an amount of paper. 168 00:11:25.180 --> 00:11:32.180 So this portion of the money supply is not debt-based. It was, here's some gold, and we're going to take it, and we're going to give you this paper. 169 00:11:32.180 --> 00:11:37.180 We're not lending you the paper. We're giving you this money. This is not debt-based. 170 00:11:37.180 --> 00:11:42.180 So this portion of the money supply forever becomes a pool from which interest payments can be drawn. 171 00:11:42.180 --> 00:11:46.180 Secondly, under the gold standard as it existed in the United States, 172 00:11:46.180 --> 00:11:54.180 the banks issued both kinds of money substitutes in the Misesian typology, money certificates and fiduciary media. 173 00:11:54.180 --> 00:12:02.180 Money certificates would be paper money that are convertible into the money proper. 174 00:12:02.180 --> 00:12:11.180 Fiduciary media would be physically indistinguishable from the money certificates, but are not backed by the money proper. 175 00:12:11.180 --> 00:12:16.180 Well, only the fiduciary media represents debt-based money. 176 00:12:16.180 --> 00:12:21.180 The rest of it represents something actual that has nothing to do with, no connection to debt whatsoever. 177 00:12:21.180 --> 00:12:30.180 Gold being mined and minted into coins has no, there's nothing involving debt or interest or principle in any of that process. 178 00:12:30.180 --> 00:12:39.180 And so this portion of the money supply becomes a source from which interest payments can be drawn, even when the physical backing is taken away. 179 00:12:39.180 --> 00:12:49.180 There was always from the start a portion of the money supply that was not connected to loans, not connected to debt, and from which interest payments can be drawn. 180 00:12:49.180 --> 00:12:51.420 Now, finally, let's see, how much time have I got left, Joe? 181 00:12:51.420 --> 00:12:55.340 Oh, good, then I am going to answer the, what about, wouldn't the banks get all the money? 182 00:12:55.340 --> 00:12:59.260 Now, you say, why do I need to address this? This is a scholarly conference. 183 00:12:59.260 --> 00:13:01.980 Because no one else is doing it. 184 00:13:01.980 --> 00:13:06.860 And there are people out there, and I've been accused of, I'm part of the Rockefeller conspiracy, 185 00:13:06.860 --> 00:13:13.180 because, and Mises, I've been told repeatedly, Mises was part of Rockefeller's conspiracy. 186 00:13:13.180 --> 00:13:16.860 And I said, well, explain that to me. I mean, I really would like to hear how this turned out. 187 00:13:16.860 --> 00:13:46.860 So Mises who inspires a movement against the central banks of the world that the elites labored tirelessly to erect is actually part of some kind of reverse psychology thing that he's doing like how could he be part of the bad guy conspiracy and I've even been told that he's part of a Jewish bad guy conspiracy to enslave European man to the bankers and I said okay so and he met with Rockefeller to work this conspiracy out and I said so the conversation I guess went something like this all right 188 00:13:46.860 --> 00:13:52.300 Rockefeller, what I, Mises, will do is, I'm going to write a book called Theory and History 189 00:13:52.300 --> 00:13:55.940 about the relationship between theory and history, then I'm going to write about the 190 00:13:55.940 --> 00:14:00.540 epistemological problems of economics, and then I'll write the ultimate foundations of 191 00:14:00.540 --> 00:14:05.340 economic science. Books that not one percent of the general public could even hope to be 192 00:14:05.340 --> 00:14:14.140 able to understand, and this is how I'll enslave everybody. Seemed implausible to me. So in 193 00:14:14.140 --> 00:14:18.900 In other words, it feeds into every conspiracy theory there is. 194 00:14:18.900 --> 00:14:21.860 I don't mean to say there aren't any conspiracies, but there certainly isn't this one. 195 00:14:21.860 --> 00:14:24.220 I mean, this is the most preposterous one of all. 196 00:14:24.220 --> 00:14:25.780 But where does this argument come from? 197 00:14:25.780 --> 00:14:27.380 The banks are going to wind up with all the money. 198 00:14:27.380 --> 00:14:28.660 Well, basically, compound interest. 199 00:14:28.660 --> 00:14:32.860 So the bank lends out $1,000, and then it gets back $1,100. 200 00:14:32.860 --> 00:14:36.220 So then it lends out $1,100, and it gets back $1,210. 201 00:14:36.220 --> 00:14:38.780 And then it lends that out, and it gets back whatever. 202 00:14:38.780 --> 00:14:39.780 And it keeps on going. 203 00:14:39.780 --> 00:14:42.700 And eventually, it's going to have everything. 204 00:14:42.700 --> 00:14:43.700 That's what I've been told. 205 00:14:43.700 --> 00:15:13.700 TomWoods.com. That was on my blog. So, a couple answers to this. Number one, let's suppose this were true. Are the bankers money fetishists? That is to say, if they did get all the money, the money doesn't do them any good unless they use it for something. Unless they really are going to roll around in it. Like, what good does it do them unless they exchange it for goods and services? So this is not something you have to worry about too much. 206 00:15:13.700 --> 00:15:17.700 But the second thing is, of course, this leaves out the question of demand. 207 00:15:17.700 --> 00:15:22.700 I mean, you could just as easily say, Apple Computer produces all these great products. 208 00:15:22.700 --> 00:15:26.700 It produces the iPod, and we all love the iPod, and so we run out and we buy the iPod, 209 00:15:26.700 --> 00:15:30.700 and then next year produces the iPad, and we buy the iPad, and that gives them more money 210 00:15:30.700 --> 00:15:33.700 to create better products and to build robots, and then we buy those. 211 00:15:33.700 --> 00:15:35.700 Before you know it, Apple will have all our money. 212 00:15:35.700 --> 00:15:38.700 But, of course, we don't have an infinite demand for consumer electronics 213 00:15:38.700 --> 00:15:41.700 any more than we have an infinite demand for credit. 214 00:15:41.700 --> 00:15:46.700 And so how are the banks going to issue these additional loans only at lower interest rates over time? 215 00:15:46.700 --> 00:15:54.700 And so credit intermediation cannot expand indefinitely, because first, in order to induce us to accept additional loans, 216 00:15:54.700 --> 00:16:00.700 the banks have to lower interest rates, and then secondly, if more and more people want to get in on this racket, 217 00:16:00.700 --> 00:16:04.700 because it's supposedly an infinitely profitable thing to just issue loans, 218 00:16:04.700 --> 00:16:08.700 as more and more people get into this, where are they going to get the money to intermediate in the first place? 219 00:16:08.700 --> 00:16:16.200 They're going to have to get it by offering higher interest rates to people who are buying, you know, who want CDs or savings accounts or whatever. 220 00:16:16.200 --> 00:16:22.200 So they're going to have to offer higher interest rates to those people, lower interest rates to the borrowers, and then their profit gets squeezed. 221 00:16:22.200 --> 00:16:30.700 And there's a natural limit that exists, as it exists in any market, as their profit gets squeezed, there's a limit to how much credit intermediation there can be. 222 00:16:30.700 --> 00:16:35.700 And then, finally, I wind up by talking about how, in fact, you can have money on the free market 223 00:16:35.700 --> 00:16:38.700 and that there is an optimal amount that will be created. 224 00:16:38.700 --> 00:16:42.700 You can't just create and create and create. I mean, people hear money created on the free market. 225 00:16:42.700 --> 00:16:44.700 If you talk about this on the radio, forget it. 226 00:16:44.700 --> 00:16:49.700 People will say, well, I'll create my own money and just create as much as I want, and that'll be a lot of fun. 227 00:16:49.700 --> 00:16:56.700 Well, no one's going to accept your, you know, Joe Salerno dollar or, you know, Tom Woods dollar. 228 00:16:56.700 --> 00:17:02.940 But secondly, as the money is created, like as gold is mined and minted into coins, whatever, 229 00:17:02.940 --> 00:17:06.900 the factors of production that go into the creation of the money get bid up as more and 230 00:17:06.900 --> 00:17:09.160 more money creators get into that business. 231 00:17:09.160 --> 00:17:12.980 So it becomes costlier to produce the money, and as more money is produced, the value of 232 00:17:12.980 --> 00:17:13.980 the money declines. 233 00:17:13.980 --> 00:17:18.220 So the costs go up, the values go down, again the profit gets squeezed, and the optimal 234 00:17:18.220 --> 00:17:19.220 amount is created. 235 00:17:19.220 --> 00:17:23.500 So the bottom line is, you don't need the government involved in money or banking at 236 00:17:23.500 --> 00:17:30.260 at all, and all the problems that the Greenbackers think they've identified in banking and money 237 00:17:30.260 --> 00:17:36.340 as it exists today, all of them, the imaginary ones and the real ones, can all be solved 238 00:17:36.340 --> 00:17:38.280 simply by getting the state out of it. 239 00:17:38.280 --> 00:17:39.580 So why don't they want to do that? 240 00:17:39.580 --> 00:17:44.440 I leave that to you as an exercise for the student, and you can read the paper at tomwoods.com 241 00:17:44.440 --> 00:17:51.440 dot com slash paper.