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NOTE Too Big Not to Fail: Imperial Governments from Moscow to Washington

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Yes, the greatest thing is pleasure to be here. It's wonderful to be here. I have a friend

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from Detroit and he said what's common between Detroit and Russia, it's a very good place

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to be from. It is really from the topic of our meeting today. I think it's fascinating.

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Banking.

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It's fascinating for me also because I would associate big government with socialism.

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Armin Alkan, a great economist from University of California in Los Angeles, amazing from

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that kind of place, a really great thinker emerged.

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He wrote a wonderful Intermediate Microeconomics textbook in which he claims and persuasively

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for students makes the point which Austrian economists knew all the time that government,

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Any government, even small government is socialist in its nature. So you can have a little bit

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of socialism or you can have a lot of socialism. You can have socialist government, say like

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in Soviet Union or in today's Cuba, or you can have a small government, a small government

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which still will be socialist, however, in the ocean of private property, private property

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and the market. And because of that, I think that the change is quantitative, quantitative.

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You can have a lot or a little bit of that.

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So that means that government should not, cannot be reformed, it cannot be run as business,

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it cannot become efficient, it should be just kept under control.

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And I remember my mentor and very dear friend, whose memory I cherish a lot, Murray Rothbard,

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at that time we talked about Ross Perot, you remember maybe Ross Perot, he was saying that

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we should open the hood of government and fix it.

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We should make government run as a business.

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And I remember Murray would say, I wonder if there is anything between these big ears.

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You cannot fix the government. You cannot. You should keep it small. You should keep

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it under control. And the bigger is the government, the worse it is for the people. I came from

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the country definitely, which was too big to fail, if you will lose Washingtonian today's

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jargon of the present government, that something is too big to fail. It was 11 time zones.

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It had all possible and impossible natural resources.

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And look what they did to that country.

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They murdered anywhere from 40 to 60 million people.

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The KGB chief admitted in 1988 on the Soviet television during something called Glasnost

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as part of Perestroika, Gorbachev's Perestroika.

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He was put on the spot and he was asked, we think 43 million people were murdered.

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Is that the right number?

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He said, I don't know right now, but in a week maybe we'll meet here again.

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And after a week, he said, yeah, the number is about right, but comrades, it's preposterous

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to think that all these people were murdered.

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Most of them died of natural causes.

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And the moderator, she was smart enough, she said, but on the premises of KGB.

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He said, yes, on our premises, people die everywhere.

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And he said, well, and she said, yeah, especially if you don't clothe them in Siberia, if you

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don't feed them, they usually tend to die.

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So why am I saying that? That the government, when the government is big, the governments

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usually run amok. They are killing their own people. I think Jeff today referred to Libya,

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to their dictator, Gaddafi, who is murdering his own people. The Soviet Union, other socialist

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countries, I refuse to use the word communist because there are many people, especially

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in academia would say communism was bad, communism was something that we were dismayed with.

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Socialism is good. However, if you will look at Karl Marx, at Karl Marx who came up with

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all these ideas. Socialism is the first stage. It's a necessary stage. His point was that

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communism would occur in four or five hundred years only with withering of the state. Can

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you imagine? It was kind of like a utopian dream that people would work for nothing.

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but during peacetime just to prove that this kind of theories work. For what reason they

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killed so much? Because there is no incentives. If you have a big, big government, then you

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don't have any incentives to work. No incentive how to force people to work. So instead of

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real incentives of the market, you have one incentive and that's fear, fear for yourself,

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for Your Family. Now, it's a very fascinating thing. I got a little grant to study archives

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in the Library of Congress by Soviet General Volkogonov. Dmitry Volkogonov was a top propaganda

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person for the Soviet government. He was commander of the Soviet Institute for Military History

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in Moscow and member of the Central Committee of the Party. So, anytime I would see him

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And then he approached the U.S. ambassador in Moscow saying that I want to move everything

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to the United States.

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Soviet Union unraveled.

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He became national security advisor to Yeltsin and he moved 46 U.S. ambassadors and said

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I will contact CIA and other agencies who would be interested in getting these materials.

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He said no CIA, no other agencies, Library of Congress.

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I want to put it there. And the other guys from CIA want to get the reader's card, go

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and read it. And now they have this treasure of 46 boxes. It's 160 rolls of film of the

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most top secret correspondence between Lenin and Stalin and Trotsky and Brezhnev and Andropov

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and Gorbachev. It was up to 1989, all these archives. And it's just amazing for me to

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see because a lot of this stuff is originals are back because KGB is back in power, so

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Putin put a lead, so you never can. This is the best and unknown in the United States.

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It's not classified even. You don't know what's on the roll, on this roll. And for

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example, there's a party secretary from the Southern Russia writing to Lenin, Dear Vladimir

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Dear Comrade Lenin, you sent us a memo that we should fight religion. How should we fight religion? Lenin on the same piece of paper handwriting. Dear Comrade imbecile, kill religious people, that's how. Lenin. And then a postscript. Postscript. And kill them the way that people will tremble 150 miles around.

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And so this is amazing. And in one of these, Lenin reveals, he understood the nature of socialism very well, much better than many of my colleagues academics.

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He understood that the only way to make it work is to kill people. And the more you kill, the more efficient that system would work.

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Work.

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He would say – in 1922, he was writing to Felix Dzerzhinsky, the first chief of KGB

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or Vechikai at that time.

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And he wrote, Dear Felix, I'm telling people what to do and they don't listen.

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And I'm thinking, what if we'll take a couple of these absent-minded comrades and

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shoot them publicly?

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Attention span would be better.

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And they did and it became better.

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And if you will look at, say, Soviet Union, the highest rates of economic growth at that

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The future, the logic of every system, when I'm being told, but look, our government,

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they're all such a bright people, wonderful people, so was first Soviet government. Trotsky

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Lenin was writing poetry in French. Lenin could play piano better than Condoleezza Rice.

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He knew he could speak seven languages. It's the logic of big government, the logic of

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socialism turned them into mass murderers. The same thing happened with Gaddafi. I was

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kind of blessed all the time with the most hot spots of history. I kind of really was

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was blessed by that. I saw the agony of the Soviet Union, the agony of the socialism there.

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And sure enough, last month I went to Tunis, Tunisia, on the 10th of January. And because

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I'm teaching at Carthage College, I decided to take a cab and go to Carthage, Tunisia,

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the real Carthage, which was supposed to be destroyed and was destroyed. So I took that

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and there was a lot of chanting and a lot of – I thought it's a football match.

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And so that's what we shout at Carthage about and it's a real one in Wisconsin.

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Well, Wisconsin now is another kind of I would say the war field of medicine.

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And so I went there to see and there was a lot of police, a lot of – I mean this was

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just amazing and police and you could see that from the hill and police were just like

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roaches trying to surround this ocean of people who were – some people would say they were

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I'm not fighting for freedom. They were fighting against high prices or whatever and the prices

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increased. Food prices increased 70% in Tunisia last year, mostly because now we are burning

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food in our vehicles. We are using corn for ethanol that rises prices all around the world

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and the poorest and the hungry, they suffer from that. That's opportunity cost in economics.

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It's also because people in India who embraced freedom and in China, which have more and

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more freedom, they are demanding better food, they are demanding higher quality food and

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so they demand for food.

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So in all these Arab countries, prices for food increased 70-90%.

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But also I think there were many of them, at least the people I talked to, many of them

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were looking for human freedom, for human freedom, for not to be interfered with.

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Something that was very moving for me was Jeff's presentation and Jeff's, especially, was kind

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of the, I would say the most, his thesis that you strip the government out of propaganda.

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You strip the government, you strip this king out of his clothes and you will see this naked

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Force, naked coercion, naked violence, abuse and rape of people, and I think we should

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do that with our government because we have so many propaganda in the United States funded

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by you. Thomas Jefferson wrote almost 200 years ago that it is the most abhorrable tyranny

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When you are forced to pay for the views that you dislike and this is just ridiculous. It's

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not even because of these views but what government has to do in brainwashing of people. We are

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paying to be brainwashed. We are paying our taxes to pay more taxes because that's what

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and NPR, that's what PBS, that's what government schools are doing to our minds.

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Think that we are losing cultural wars. Cultural wars, there was plenty, kind of a great body

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of socialist literature. That's what we should do with capitalism. We should at first poison

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their brains. We should deprive them of their ability to think because the goal is such

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Such a wonderful goal that we should sacrifice these choices in thinking. That's Antonio

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Gramsci, the Italian socialist in 1923-24. He was a great student. That's Hillary Clinton.

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She was praising him quite a lot. The idea is to win these wars by the left. Again, if

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If we return back to what is public good, why we should have government radio or government

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television? Rationale would be that private sector is a market failure, something called

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market failure in mainstream economics, this idiotic theory of market failure, that market

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fails to produce enough education for example or enough roads or enough space exploration

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And so we need the big government to step in and fix it and do that for us. However,

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I would say left propaganda, and that's what the public broadcasting is all about, is lavishly

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supplied by the private sector. Look at ABC, CNBC, MSNBC, all BCs are what doing. Yes.

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They are all turning out left-wing propaganda. And like we don't have enough, we have government

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and Propaganda, which is propaganda of big government. No matter who is in the White

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House, no matter who controls the Congress, what they're talking about only about the

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big and bigger and bigger and bigger government. I'm not saying that we should fund, say,

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conservative radius by the government. No, we shouldn't. It's not the content, but

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the whole absurdity, the whole absurdity that government should run any kind of propaganda

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Station, National Propaganda Radio, definitely PBS. I was on PBS a couple of times. And can

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you imagine, it was a pretty long time ago. Mr. Laird, he called me a third time and he

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said, well, conservatives want to give Russia $30 billion, was at that time discussing how

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to help. And liberals want to give $50 billion. And it sounds to me like it's very vague

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Spectrum, so that's what happened.

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Another thing is that leadership. I was asked recently to prepare kind of to be part of

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a leadership program in Capitol Hill Club, which is National Republican Club in Washington,

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DC, and to talk about different types of leadership, different types of leadership. And the organizer,

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even they were there and I was looking at the types of leadership and they have like

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like efficient leadership, functional leadership, democratically participatory leadership, and

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I was thinking, what is that? I mean, I haven't seen that at all. And then at the bottom of

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the list, they have in the leadership science or whatever it is, they have toxic leadership

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and narcissistic leadership. The last one, narcissistic, yeah. And these two I saw. These

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two I saw in Moscow and in Washington because I worked for Gorbachev's government as one

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of Economic Advisers, and I would put a disclaimer, I wasn't the advisor, I wouldn't take the

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blame for what happened over there. But then when I defected to the US, I began to work

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for the second largest bureaucracy of this planet for the federal government. So I saw

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enough of both toxic and narcissistic leadership in both places, yes. I would say the US fortunately

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will have more narcissistic than toxic yet. But it's kind of combinations. Look at the

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The previous, I think, was more narcissistic and less toxic. Now we have more toxic, less

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narcissistic. There is a famous quib by St. Francis that you have a two-party system. One

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party is stupid and another evil. But we can actually paraphrase it and say one party is

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narcissistic and another toxic. Usually toxic is in power, whatever it is.

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So this is, I think we need to learn this example.

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For me it's very sad to see how so many people, 172 million people, slaughtered by their governments

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during the 20th century and the only lesson of history is that it does not teach us anything.

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That means that, yes, just to remember these people and to remember them, I think that

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I used Cuba as a very good example.

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I would take my kids, my students, my students from my school to Cuba all the time because

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you just peek into that door and you will never be a socialist again. If you would see

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how that beautiful country with proud people to what kind of, how it was destroyed completely,

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how these people were abused and what not and it's just amazing. And then you see movies

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is like Michael Moore's sicko or other propaganda, which is worse than the worst communist propaganda.

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It's kind of more believable. They're showing hospitals which are attended only by the party

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elite, by the party elite, and they pretend that this is... And in Cuba, I have a friend

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from my Moscow ties because a lot of Cubans were indoctrinated in Moscow, were taken as

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Students and brought back to Cuba and I would invite him to talk to my to my class and one one young woman

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She said well, we see it's kind of disaster right around but we heard you have the best health care in the world

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He said yeah, we do you do he said we have a best health care

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We couldn't we can improve if we would have ambulances for example or medicines or occasional

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Clinics or dental care for the people then would be even better

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And then, when he finished, we were exiting the room already, two of us, and he in Russian,

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he said, come on, what a stupid. And I said, so why? She just was curious. He said, the only, in Russian, he told me, the only health care in Cuba is to swim to Miami right away.

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That was his major point. If anyone is interested, I have these pictures of health care that

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I got there. Just unbelievable, unbelievable. So this is definitely what we need to keep

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in mind.

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Then, for some reason, our government decided probably that it's bad for us to go to Cuba,

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Defect Right Away.

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That's what would happen.

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But what they did, they said, well, that you can only go to Cuba for a semester-long studies

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because the short term to the trip, but you are getting so frustrated and so depressed

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there if you are there for more than a week because to see human misery and you cannot

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help with anything, the country is completely, it's rampant prostitution.

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For what reason? I was kind of thinking, very easy, because people don't have anything

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else to sell. I would say that in Cuba, I became more and more convinced, and I am trying

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to write it kind of in a scientific way or in an acceptable way, that socialism in general,

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if you have a real socialism, then it degenerates into something called public slavery. Public

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and the public slaves, and that's why you can kill them in millions, because they're not yours even.

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It's kind of the same neglect as the government is doing to everything.

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If you look at public housing in the United States or public something else, and the same happened to people.

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Public slavery is the worst kind of slavery because then people are being murdered in millions.

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I'm not saying that private slavery is good, no, but that would be insane for a slave owner

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to kill his slaves, but for people like Lenin and Stalin and Hitler and Fidel Castro and

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Mao Zedong and Raul Castro, these are not theirs, they're just expendable.

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That's why Stalin used to say, death of one person is a great tragedy.

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Method of a Million is statistic, nothing else.

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And so that's how they treated, that's how they treated people.

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And I think that this kind of lesson we should learn.

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I see that this is my duty to talk about that.

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Maybe it will sound gruesome, especially I'm kind of the last obstacle between you and

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lunch and I'm afraid to sound like that.

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And it is really very important for us to have open eyes.

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So now I cannot take students to Cuba, but I found another, yeah, because for a semester

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long, I mean, this is ridiculous, absolutely, I mean, I will better spend a semester in

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Kenosha County Jail than in that island of freedom.

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It is really ridiculous.

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But there is another very good vaccine against socialism, that recently I would like to advise

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you to maybe to show it, especially if you have younger people you know who are still

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socialists.

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Hayek used to say that if you are 20 you are not a socialist, you don't have a heart.

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If you are 30 and still a social, you don't have brains.

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In that period, it's very important for people to get in touch with something.

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That's a documentary which was produced in former Soviet Republic of Latvia just a year

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ago called The Soviet Story.

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Even for me, who lived there for so long, who is studying it professionally, that was

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is a revelation of a lot of things, because they also had an access, because when Soviets

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were retreating from Baltic states, they ran away without picking up their archives and

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everything. So they looked into these archives and they found so many things, you wouldn't

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believe it. For example, Karl Marx, can you imagine that socialists in the Soviet Union

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prohibited access of the public to some writings of Karl Marx? Some writings of Karl Marx

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were highly classified. In 1848, Karl Marx owned and was the publisher and editor of

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Neue Reine Zeitung, a newspaper in Germany, in which in an editorial he wrote, whole Europe

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is littered with racial trash. And that would be Scottish islanders, Basques, Serbs, Poles

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and other Slavs. And we should get rid of them. They should be burned in revolutionary

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Holocaust, he used this word, Holocaust. For what reason? Because they are so backward that

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we cannot bring them to understanding socialism. They are two stages below, behind what the

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advanced nations of Europe are about. So we should discard them, discard them for the

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benefit of the future generations, for the benefit of the future generations.

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So he was the one who came first with this idea of genocide or this idea of ethnic cleansing,

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of ethnic cleansing of people.

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In other editorial he was absurdity of Poland, absurdity of Poland.

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Poland is a mistake, that's what he was writing.

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Poland should be discarded.

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And no, no, no, no, no, not like that.

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It's an amazing, I mean amazing video.

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It's great about it that those people who already made it from communist slavery or

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socialist slavery to freedom, say people in Poland, Lithuania, Latvia, Estonia, they are

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showing it in everybody in their high schools or universities. I've been shown this video.

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This is the best inoculation not to repeat the past, I think. It shows 7 million Ukrainians

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is Starved to Death. It shows such a horrendous crime. It shows first time in, I think, in

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the history, I didn't know about that, that there was a special department in the KGB

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which was experimenting with health in the medical field in Gulag and they're showing

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people with their skulls removed and you can see just kind of like sitting people still

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alive with kind of like first you think it's cauliflower in their hands. It's just their

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in Germany and everywhere else, they kind of put it in the right perspective. And people

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were condemned and sentenced for doing these kind of things. In today's Russia, these people

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are being praised. For me, as a Russian myself, it was amazing

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that in 2000, when there were still more or less free elections in Russia, that 73% of

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people voted a proud KGB colonel, Putin, into power. He doesn't have any repentance. He

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praises the Soviet Union. He was saying that was the most tragic event in human history,

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the dissolution of the Soviet Union. At that time, somebody asked me whether I travel much

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to Russia, and I don't because my last article published in Russian, there was a meat voted

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for a meat grinder. So Russia is one-sixth of the world territory, so I'm enjoying traveling

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in another five-sixth. But now I think we see the good signs that freedom is on the

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mind of many people because if you're trying so much to do something stupid all the time,

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And at certain point I think you see the light and more and more people in Russia are following

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the good example of their neighbors in Eastern Europe who already discovered what socialism

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is and how bad it is and now they are self-confident and they become richer and they are talking

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about the Crimes of Socialism openly, and this is extremely, extremely important.

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So I will stick around and if you have any questions during lunch and after that I would

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be delighted to talk to you and I will depart tomorrow only in the morning if you have any

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questions.

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Also, my email is everywhere on Von Mises material so please use that if you need any

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Any pictures of Cuba or any links to whatever is happening in Eastern Europe, it's wonderful.

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And also I would advise you to think about in your travels, to visit Eastern Europe,

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to visit Estonia for example, which is fantastic. It's such a beacon of freedom. On the Economic

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Freedom Index, which is compiled actually by Jim Gortney from University of Florida

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here in Tallahassee, and Estonia is number four, United States is number six in economic

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freedom.

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So you can see how former Soviet countries, former Soviet countries, they went fell swoop,

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they got rid of it and that makes people free and prosperous.

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And no oil, no gold, no diamonds are making people prosperous, only human freedom is the

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The Source of Prosperity