WEBVTT NOTE The Economy: What's Next? 1 00:00:00.000 --> 00:00:12.000 And we are pleased to have with us today the brilliant economist and anarcho-libertarian philosopher, Dr. Walter Block, a nationally important person who teaches at Loyola University in New Orleans. 2 00:00:12.000 --> 00:00:20.000 You can also catch him at WalterBlock.com and I'm going to introduce him by reading something from his recent writing, 3 00:00:20.000 --> 00:00:24.240 radical libertarianism applying libertarian principles to dealing with 4 00:00:24.240 --> 00:00:29.880 the unjust government late one night in Washington DC a mugger wearing a ski 5 00:00:29.880 --> 00:00:33.200 mask jumped into the path of a well-dressed man and stuck a gun in his 6 00:00:33.200 --> 00:00:37.600 ribs give me your money he demanded indignant the affluent man replied you 7 00:00:37.600 --> 00:00:42.040 can't do this I'm a United States congressman in that case replied the 8 00:00:42.040 --> 00:01:12.040 Robert, give me my money! Dr. Block? Yes, yes. I love that, Dr. Block. Thank you. Oh, you're very kind. Thank you. How are you doing? Oh, hanging in there. That's good. So what's going on in America right now? Well, lots of interesting things. We're having a little depression. We're having a little oil spill. Yes, yes. So you would classify this as a depression right now? I think so, yeah. And why? Why is that? Well, according to the government 9 00:01:12.040 --> 00:01:16.920 The unemployment rate is only, what is it, 9.8%, they keep changing it a little bit, 10 00:01:16.920 --> 00:01:22.080 but according to independent statistics, the real number is 22%, which is starting to sound 11 00:01:22.080 --> 00:01:25.880 like 1930s-level depression. 12 00:01:25.880 --> 00:01:28.160 And what was the unemployment rate in the 1930s? 13 00:01:28.160 --> 00:01:32.240 Well, it varied, but it was up in the 20s. 14 00:01:32.240 --> 00:01:36.400 And there are some unemployment rates even now, they're in the 30s and 40s, like, say, 15 00:01:36.400 --> 00:01:37.880 teenage black males. 16 00:01:37.880 --> 00:01:53.400 And of course, in the 30s, the United States had no national debt, correct? 17 00:01:53.400 --> 00:01:58.600 And we were an exporter, in other words, we were able to feed ourselves, we didn't import 18 00:01:58.600 --> 00:01:59.600 food. 19 00:01:59.600 --> 00:02:02.440 Well, I don't think there's any problem with that, although they did have the smooth 20 00:02:02.440 --> 00:02:09.440 I congratulate Obama for not doing that. I'm sure his union types would love nothing better than that, although we do have the Jones Act, speaking of the BP oil spill, which is sort of like that. The idea is that the Jones Act requires that only U.S. ships do that. 21 00:02:32.440 --> 00:02:38.440 Do certain things off our coasts, like help with oil spills. 22 00:02:38.440 --> 00:02:42.880 And so all these big giant ships that have offered to come suck the oil up at the source 23 00:02:42.880 --> 00:02:48.200 have been refused entry under the Jones Act, which Obama has not lifted, correct? 24 00:02:48.200 --> 00:02:49.200 Absolutely correct. 25 00:02:49.200 --> 00:02:54.160 And, of course, Bush, for all his faults, lifted it, I think, two days after Katrina. 26 00:02:54.160 --> 00:02:56.160 And I didn't know he did that. 27 00:02:56.160 --> 00:02:57.160 Yeah, he did. 28 00:02:57.160 --> 00:02:58.160 Bless him. 29 00:02:58.160 --> 00:02:59.160 On the other hand... 30 00:02:59.160 --> 00:03:00.160 On the other hand, he... 31 00:03:00.160 --> 00:03:06.040 On the other hand, we don't want to let Bush off too easily, because FEMA played roughly 32 00:03:06.040 --> 00:03:10.480 the role of the Jones Act, namely FEMA wouldn't allow all sorts of like hospital ships and 33 00:03:10.480 --> 00:03:16.280 people to come and help us, FEMA turned them away, FEMA turned truckloads of ice and orange 34 00:03:16.280 --> 00:03:23.340 juice away from Kentucky and Tennessee, and turned away ships also, so there is a similarity 35 00:03:23.340 --> 00:03:30.120 between the Bobsy twins, Bush and Obama, their skin might be a different color, but 36 00:03:30.120 --> 00:03:32.920 Deep down, I see a lot of similarities between them. 37 00:03:32.920 --> 00:03:38.520 Yes, and the libertarian offers a different avenue to approach government, correct? 38 00:03:38.520 --> 00:03:39.920 Yes, slightly different. 39 00:03:39.920 --> 00:03:44.720 And how would you describe that for people that aren't familiar with the libertarian philosophy? 40 00:03:44.720 --> 00:03:51.120 Well, you know, that government is best which governs least, with one way to... 41 00:03:51.120 --> 00:03:52.320 I just made that up myself. 42 00:03:52.320 --> 00:03:54.820 I was going to say, hmm, that sounds oddly familiar. 43 00:03:54.820 --> 00:03:57.320 No, no, no, I just created that. 44 00:03:57.320 --> 00:04:05.820 Well, you have an article that libertarianism is neither left nor right. Can you explain that? 45 00:04:05.820 --> 00:04:22.820 Well, yes. People try to pigeonhole libertarians into the left-right spectrum, and typically the political scientists will give you a quiz, and they'll say, well, are you far left, moderate left, in the middle, far right, or middle right, or moderate right? 46 00:04:22.820 --> 00:04:29.820 And there's no place for libertarians to go, because on certain issues, libertarians are more leftish, or lefties are more libertarian. 47 00:04:29.820 --> 00:04:33.820 On other issues, righties, conservatives, are more libertarian. 48 00:04:33.820 --> 00:04:42.820 And on foreign policy, they're both very different than libertarians, at least of the wrong poor variety. 49 00:04:42.820 --> 00:04:51.820 For example, on economics, conservatives, right-wingers are not all that bad, like if you look at the Wall Street Journal, sometimes called the Wall Street Journal. 50 00:04:51.820 --> 00:04:56.880 in the street journal. They're pretty good on economics, or at least they're not awful. 51 00:04:56.880 --> 00:05:02.880 And if you look at some of the lefty blogs, they're not that bad on, say, legalizing prostitution 52 00:05:02.880 --> 00:05:09.880 or pornography or freedom of the bedroom, although the feminists are not noted for that. 53 00:05:11.380 --> 00:05:16.260 So I think libertarians are neither of the left nor of the right. We're sui generis or 54 00:05:16.260 --> 00:05:32.260 We believe in freedom across the board. The government should stay out of the bedroom and the bathroom and the pharmacy. The government should also stay out of the kitchen and the counting house. Pretty much the government should stay out of a lot of things. 55 00:05:32.260 --> 00:05:37.260 How would you characterize a Thomas Jefferson in terms of his libertarianism? 56 00:05:37.260 --> 00:06:07.260 Well, he was pretty good. He was a little weak on slavery. But apart from that, and pretty much everyone in the 18th century was a little weak on, and I don't mean to deprecate the evils of slavery by saying a little weak, I'm just being silly here, he was horrible on slavery. But apart from that, Thomas Jefferson was pretty libertarian. He was one of the people who would certainly agree with that government is best, which governs least. 57 00:06:07.260 --> 00:06:15.260 And all of our founding fathers, with the exception of Hamilton, were very much in favor of people being free. 58 00:06:15.260 --> 00:06:23.260 And free to make their own mistakes, free to succeed without the government reaching into their pockets and their bedrooms and everything else. 59 00:06:23.260 --> 00:06:32.260 And now we see the government even wanting to have electronic health records come 2014, 60 00:07:02.260 --> 00:07:06.260 and other sorts of things. It usually doesn't turn out to be for our own good. 61 00:07:06.260 --> 00:07:11.260 For example, one of my favorite topics, I don't know that this is relevant, but I'll just shoot it out there, 62 00:07:11.260 --> 00:07:16.260 is some 40,000 people die on the nation's highways every year. 63 00:07:16.260 --> 00:07:22.260 And my most recent book is in favor of privatizing highways and roads and streets. 64 00:07:22.260 --> 00:07:27.260 And the excuse that the National Highway Traffic Safety Administration will give is, 65 00:07:57.260 --> 00:08:27.260 When we come back, I'd like to talk about what the average person can do to protect themselves in this depression that we're living in, and whether or not you as an economist 66 00:08:27.260 --> 00:08:57.260 Do you have any ideas of how they might... I'm not looking for investment advice, but just some practical advice that people can do, like buy silver, hide it in the bed, dig a hole in the backyard, hide your wealth from the government, anything you want to share with the audience, and more, coming back with Dr. Walter Block, and I'm just going to follow up with what we went out on the break where I was wondering, Dr. Block, if you have any advice as to what people might do in terms of economics regarding 67 00:08:57.260 --> 00:09:10.260 One advice is to move to a freer country. The U.S. sometimes we think of ourselves as the freest country, but there are, according to calculations of which is the freest country, we're only about sixth or seventh. 68 00:09:10.260 --> 00:09:11.260 Who's freer? 69 00:09:11.260 --> 00:09:25.260 Countries that are freer are Hong Kong, New Zealand, Switzerland, Singapore, one or two others. I don't remember. But you can look it up. One of my books is on that. 70 00:09:25.260 --> 00:09:30.220 on that, Economic Freedom in the World is called, so that's one possibility, move to 71 00:09:30.220 --> 00:09:31.220 a freer country. 72 00:09:31.220 --> 00:09:33.620 Assuming you can't do that or don't want to. 73 00:09:33.620 --> 00:09:38.500 Right, the language difficulty, although New Zealand, they speak funny English, but it 74 00:09:38.500 --> 00:09:39.500 is English. 75 00:09:39.500 --> 00:09:40.620 Yes, the Kiwis. 76 00:09:40.620 --> 00:09:45.060 And also Switzerland, they speak English there. 77 00:09:45.060 --> 00:09:50.100 The suggestions that you mentioned about burying silver in your backyard sound pretty good 78 00:09:50.100 --> 00:09:51.100 to me. 79 00:09:51.100 --> 00:09:52.100 That's what I thought. 80 00:09:52.100 --> 00:09:58.460 Gold, although Obama's buddy FDR declared gold illegal in the thirties, and I don't 81 00:09:58.460 --> 00:10:01.500 know whether Obama will do that or not, but that's a possibility. 82 00:10:01.500 --> 00:10:04.260 Yeah, so that requires people to voluntarily give it back. 83 00:10:04.260 --> 00:10:06.460 I think I might want to nullify on that. 84 00:10:06.460 --> 00:10:12.100 I did want to ask you your opinion on that, because I think it was Greenspan in 66 said 85 00:10:12.100 --> 00:10:18.040 that the only way the federal government could protect itself against the people is to declare 86 00:10:18.040 --> 00:10:19.040 gold illegal. 87 00:10:19.040 --> 00:10:42.040 Well, I don't know. It's hard to predict what's out of the bed Obama will get out on. But, you know, Greenspan in the 60s was very good. He was associated with Ayn Rand. He favored the gold standard. And then later on, he sort of went off into the other end of the spectrum. 88 00:10:49.040 --> 00:10:54.360 Particulary Western Europe. We've seen Greece go through some tough times and we know that 89 00:10:54.360 --> 00:11:02.360 Portugal, Spain, Italy and others will manifest itself very soon I do believe. For example 90 00:11:02.360 --> 00:11:07.180 I guess in Greece they are selling off or leasing off at least portions of some of their 91 00:11:07.180 --> 00:11:14.600 islands. I read that Wyoming which owns the Grand Teton National Forest is considering 92 00:11:14.600 --> 00:11:19.600 and leasing off part of that. This is basically the payoff central bankers, correct? 93 00:11:19.600 --> 00:11:25.600 Well, that's one way to look at it. I just have to put in a plug for Portugal. They did legalize drugs, so... 94 00:11:25.600 --> 00:11:26.600 Well, good. There you go. 95 00:11:26.600 --> 00:11:28.600 Watch out what you say about Portugal. 96 00:11:28.600 --> 00:11:30.600 Well, but I mean financially. I mean, they're... 97 00:11:30.600 --> 00:11:32.600 No, no, no. You're quite right. 98 00:11:32.600 --> 00:11:38.600 And what's to prevent that from happening in the U.S.? And how about we do what Iceland did, which is tell them, no, I don't think so. 99 00:11:38.600 --> 00:11:43.600 Well, Murray Rothbard has always talked about reneging on government debt. 100 00:11:43.600 --> 00:11:51.600 People who lend government money are aiding and abetting an evil force and deserve very little, if anything. 101 00:11:51.600 --> 00:11:56.600 Well, that leads to this, though, and I can't cite where it is, but I know in the Constitution, 102 00:11:56.600 --> 00:12:01.600 part of the Constitution is that the debt of the federal government shall not be questioned. 103 00:12:01.600 --> 00:12:06.600 Isn't that an interesting little clause they put in? So how do we get around that one? 104 00:12:06.600 --> 00:12:07.600 Because I think we should default. 105 00:12:07.600 --> 00:12:13.160 Yes, Tom Woods has got a new book out called Nullification, where he makes great play of 106 00:12:13.160 --> 00:12:18.320 the Tenth Amendment, which says that those powers not specifically given to the government 107 00:12:18.320 --> 00:12:26.280 are reserved to the states, and the government has been hogging up all these attributes for 108 00:12:26.280 --> 00:12:27.840 lo these many years. 109 00:12:27.840 --> 00:12:35.240 So repudiation of federal debt might work out through Nullification a la Tom Woods. 110 00:12:35.240 --> 00:12:39.680 We had him on as a guest earlier today and he told us to tell you hello. 111 00:12:39.680 --> 00:12:43.000 Oh, well, I'd say hello back, but he's already gone. 112 00:12:43.000 --> 00:12:48.680 But I'll be seeing him soon at the Mises Institute, they're having a week-long seminar. 113 00:12:48.680 --> 00:12:54.960 And are there seminars that people in New Orleans that are interested in your views on 114 00:12:54.960 --> 00:12:55.960 the economy can attend? 115 00:12:55.960 --> 00:12:56.960 Do you have anything upcoming? 116 00:12:56.960 --> 00:12:59.800 Well, as you know, because you attended when Ron Paul came here. 117 00:12:59.800 --> 00:13:04.600 I sure did, along with the thousand-something people, which the Times picking didn't cover. 118 00:13:04.600 --> 00:13:06.840 Well, I guess it was unimportant. 119 00:13:06.840 --> 00:13:12.280 I guess ten people in the front of City Hall, front page news, twelve hundred kids enthusiastically 120 00:13:12.280 --> 00:13:16.800 screaming for Ron Paul, and sound money system doesn't make the news. 121 00:13:16.800 --> 00:13:17.800 Right. 122 00:13:17.800 --> 00:13:22.760 Well, as you know, we do have a libertarian program here at Loyola, New Orleans. 123 00:13:22.760 --> 00:13:27.400 If people would email me, I'll put them on a list to notify them of events that are coming 124 00:13:27.400 --> 00:13:28.400 up. 125 00:13:28.400 --> 00:13:37.160 The email address is WBlock, like around the block, at Loino, L-O-Y-N-O, Lewis Oliver 126 00:13:37.160 --> 00:13:40.040 Yellow New Orleans dot E-D-U for education. 127 00:13:40.040 --> 00:13:45.120 So if anyone out there in radio land emails me and says, put me on the list to be notified 128 00:13:45.120 --> 00:13:48.720 of Lipitern events, I will certainly do just that. 129 00:13:48.720 --> 00:13:53.480 Alright, now we do have a caller on the line with a question for our guest. 130 00:13:53.480 --> 00:13:55.400 Let's go to a Mandeville, Michael. 131 00:13:55.400 --> 00:13:56.400 Good morning. 132 00:13:56.400 --> 00:14:02.400 Hey guys, just calling from the kitchen of bitching this morning. I just wanted to ask you this question, Dr. Block. 133 00:14:02.400 --> 00:14:12.400 I noticed that there's some legislation just recently, I don't know if it's passed yet or not, with regards to reform for the financial systems, the banking systems. 134 00:14:12.400 --> 00:14:24.400 And I was made aware by someone else, and I haven't verified this, but apparently this new legislation, this sweeping legislation to regulate the financial industry does not include or affect Fannie Mae or Freddie Mac. 135 00:14:24.400 --> 00:14:28.840 and additionally one other thing that was left out of this I think that was 136 00:14:28.840 --> 00:14:34.360 being argued and considered was a return to a system similar to the Glass-Steagall 137 00:14:34.360 --> 00:14:39.220 Act and apparently what I've heard recently is that Germany is actually 138 00:14:39.220 --> 00:14:42.600 toying with the idea or actually considering a return or actually some 139 00:14:42.600 --> 00:14:46.520 sort of system similar to the Glass-Steagall Act as well. Have you heard 140 00:14:46.520 --> 00:14:49.660 these things? Are you are you familiar with it? Can you confirm whether as to 141 00:14:49.660 --> 00:14:58.660 Well, yes, I think that you're quite right, in your facts and also in your assessment. 142 00:14:58.660 --> 00:15:05.660 The Glass-Steagall Act established the FDIC and helped along with central banking. 143 00:15:05.660 --> 00:15:10.660 You see, what happens is the government has regulation A, and it screws up. 144 00:15:10.660 --> 00:15:15.660 Instead of going back to the free enterprise system, they have regulation B, and that screws up even worse. 145 00:15:15.660 --> 00:15:45.660 and now they go to regulation CD, I guess we're past Z, I don't know what the letter after Z is, but what they ought to do instead of going down that regulation path which leads to the Soviet system is to go back, turn back the clock toward the free enterprise system, go back to the gold standard, get rid of fractional reserve banking, in other words, incorporate what Ron Paul has been talking about in terms of financial security, certainly Freddie and Fanny 146 00:15:45.660 --> 00:16:03.180 Well, I'd just like to send a shout out to Senator Dodd and Barney Frank and thanking 147 00:16:03.180 --> 00:16:06.940 them for running this country and I hope that everyone hears that and keeps that in mind 148 00:16:06.940 --> 00:16:09.740 that they're both Democrats, so, anyway. 149 00:16:09.740 --> 00:16:14.140 And I agree that there is no left or right, I agree solely with, wholly with what you 150 00:16:14.140 --> 00:16:44.140 The Theory of Money and Credit 151 00:16:44.140 --> 00:16:49.140 You're just really not economically free, and if you're not economically free, you're not free. 152 00:16:49.140 --> 00:16:53.140 Does all the world's countries operate under a central bank? 153 00:16:53.140 --> 00:16:59.140 I'm really not sure. There are 275 countries, and I imagine some of the teeny-tiny ones that are just islands. 154 00:16:59.140 --> 00:17:04.140 But I really, unfortunately, can't fully answer your question. 155 00:17:04.140 --> 00:17:07.140 The major countries all do have, yes, certainly. 156 00:17:07.140 --> 00:17:12.140 You're kind of fading out there, Dr. Block. I don't know if something's going on with your phone, but that's better. 157 00:17:12.140 --> 00:17:22.640 What I'm saying is that the major countries all have central banks, but I'm not sure that I agree with that statement that if you have a central bank, you're not economically free, and if you're not economically free, you're not free. 158 00:17:22.640 --> 00:17:32.140 There are degrees. I mean, horrible central banks, and then there are central banks that aren't as horrible. There are degrees in all of these things. 159 00:17:32.140 --> 00:17:38.140 Now, I wasn't seriously suggesting that people leave the country. Look, I haven't left the country. I'm still here. 160 00:17:38.140 --> 00:17:43.140 I was asked the question of what could you do and that should be put on the list. 161 00:17:43.140 --> 00:17:47.140 Absolutely, that and there is that shovel in the silver in the backyard. 162 00:17:47.140 --> 00:17:50.140 You're definitely right. These are matters of degree. 163 00:17:50.140 --> 00:17:57.140 But the reason I say that is because if they can inflate the currency and steal from what you're trying to save, 164 00:17:57.140 --> 00:18:01.140 I really just don't think you're economically free. 165 00:18:01.140 --> 00:18:04.140 But certainly not everybody is as bad as what we've got here. 166 00:18:04.140 --> 00:18:11.140 Well, for example, the German central bank is usually better than, say, the Greek central bank or others. 167 00:18:11.140 --> 00:18:17.140 So even though they both have central banks, if one has harder money, like, say, Switzerland, than the other, 168 00:18:17.140 --> 00:18:22.140 you're better off with one central bank than another. So it is a matter of degree, although I certainly agree with you that 169 00:18:22.140 --> 00:18:27.140 central banks have three bad things and we should have free enterprise money, which is the gold standard. 170 00:18:27.140 --> 00:18:33.140 We have a caller online, too, for you. Mike in Covington, you have a question for Dr. Block? 171 00:18:33.140 --> 00:18:46.140 Good morning, it's a great show and I really had a question for the doctor and I wanted to find out what is the most effective way to detach yourself from an over-regulated system to a free market system? 172 00:18:46.140 --> 00:19:01.140 Is it progressive steps or is it like using the idea embodied in the 10th Amendment where you would have your localized or regional regulation bodies or authorities that are going to kind of run things? 173 00:19:01.140 --> 00:19:31.140 and through that separation of power you don't have it coalescing into a national or a federal government and is it really just returning to that? Is that our best hope in the short term to try to get rid of the communist system or the socialist system that is really just crony capitalism back more toward the free market? Is that the approach we should take? Is it to say let's take the control back on the state level? Well, I think there are many, many ways to go. For example, there's the Free State Project where libertarians are 174 00:19:31.140 --> 00:20:01.140 to move to New Hampshire. That's one way to go. Another way to go is to come to study economics at Loyola University with me and my colleagues, because we're the most free enterprise economics department of all. Another is to support groups like the Mises Institute that are working in this end. Another is, I'm not sure about the Libertarian Party with Bob Barr, but certainly Ron Paul, support this radio program and other radio 175 00:20:01.140 --> 00:20:20.140 Dr. Block, you've been a great guest and I would really encourage everybody to learn as much as you can from Dr. Block and that's a lot. I certainly have. And we'll have him back for sure because he's back to New Orleans now. 176 00:20:20.140 --> 00:20:25.140 And his website is pretty simple, WalterBlock.com, just like it sounds. 177 00:20:25.140 --> 00:20:35.140 Yes. So encourage your friends to go check out Dr. Block and download some, download this podcast and listen to it. And Dr. Block, anything you want to promote? 178 00:20:35.140 --> 00:20:40.140 Well, this radio program is magnificent. I certainly support it. 179 00:20:40.140 --> 00:20:41.140 Thank you so much. 180 00:20:41.140 --> 00:20:43.140 Thanks for having me and I look forward to coming again. 181 00:20:43.140 --> 00:20:44.140 Excellent. Thank you very much. 182 00:20:44.140 --> 00:20:45.140 Thank you, Dr. Block. 183 00:20:45.140 --> 00:20:46.140 This is Tom Coates and Michelle Godin.