WEBVTT NOTE Capitalism Is Life Itself 1 00:00:00.000 --> 00:00:05.280 I'm curious, actually, how many, because Doug said something about the Jetsons and I heard a few people go, 2 00:00:05.280 --> 00:00:09.760 oh yeah, sure, sure, sure, but they were both, I should say, people my age. 3 00:00:09.760 --> 00:00:14.720 So I'm wondering how many of, how many people in the room know about the Jetsons? 4 00:00:14.720 --> 00:00:18.960 Oh, so, well, how many people don't know about the Jetsons? 5 00:00:18.960 --> 00:00:23.760 Oh, you don't know about, you don't know about the Jetsons? And you don't know about the Jetsons? Okay, well, I highly recommend the Jetsons. 6 00:00:23.760 --> 00:00:29.360 You know, I often say, well, look, it's like a Jetsons world, you know, we've got these great gizmos and things, you know. 7 00:00:29.360 --> 00:00:35.200 The other day I was, sometimes we use gizmos just because it's fun to do it, you know, 8 00:00:35.200 --> 00:00:40.080 instead of just using plain old things. Like, for example, the other day I needed to call 9 00:00:40.080 --> 00:00:44.160 a friend and I could have just picked up my phone and called him, but I thought, no, that's just too, 10 00:00:44.160 --> 00:00:51.200 you know, boring. So I pulled up my Skype app, you know, oh, Skype app, you know, and so I'm going 11 00:00:51.200 --> 00:00:56.320 to stop like, don't do this, right, don't play with your iPhone while you drive. Okay, so I'm playing 12 00:00:56.320 --> 00:01:05.180 I open up my Skype app and I try to video chat with him, you know, and so after a long 13 00:01:05.180 --> 00:01:09.940 series of interchanges, whatever, we were finally talking on the phone, and I'm driving 14 00:01:09.940 --> 00:01:14.040 like this, and he said, well, I've just got to, you know, I'm looking at him, you know, 15 00:01:14.040 --> 00:01:18.320 whatever, and he's looking at my car, you know, and there's a stoplight or something. 16 00:01:18.320 --> 00:01:20.560 So he said, well, Jeff, I just have one question. 17 00:01:20.560 --> 00:01:25.440 Why are we doing this weird video chat Skype thing, actually? 18 00:01:25.440 --> 00:01:31.440 and it would have been easier just to give you a call. I said, no, it's like the Jetsons, 19 00:01:31.440 --> 00:01:35.800 you know, and we've got video. So he said, well, I can see the point, but can you just 20 00:01:35.800 --> 00:01:40.200 maybe at the next stop like cut this off and give me a plain normal phone call like the 21 00:01:40.200 --> 00:01:47.560 old days? Okay. Some people say to me, well, look, it's not like the Jetsons because we 22 00:01:47.560 --> 00:01:53.400 don't have flying cars. Okay, well, that's, to me, that's a superficial criticism of my 23 00:01:53.400 --> 00:01:57.960 My thesis, you know, come on, we don't have flying cars. In fact, there are flying cars, 24 00:01:57.960 --> 00:02:05.920 we don't use them, it's true. But why? Maybe it's because the government owns all the streets 25 00:02:05.920 --> 00:02:10.840 and has this kind of lockdown system where we have to, you know, get in these cars that 26 00:02:10.840 --> 00:02:14.960 they've given permission for us to use and they're configured a certain way and we've 27 00:02:14.960 --> 00:02:19.320 got central planners telling us how we have to get from here to there, we sit at stoplights 28 00:02:19.320 --> 00:02:23.560 and Wait Forever, talking about our Skype apps, you know. I mean, all of this stuff, 29 00:02:23.560 --> 00:02:27.360 you know, we don't know what the world would actually in fact look like if it were fully 30 00:02:27.360 --> 00:02:31.160 privatized. We don't know. And that's one of the problems that's presented by economics 31 00:02:31.160 --> 00:02:41.000 is that so much is focused on imagining the way the world would be in the absence of things 32 00:02:41.000 --> 00:02:45.320 just that you see. So we have to think about opportunity costs all the time. It's all the 33 00:02:45.320 --> 00:02:48.680 choices that are below the one you've currently chosen, they're invisible to you. But you 34 00:02:48.680 --> 00:02:52.840 You have to think about them. It's abstract. You have to think about what the world would 35 00:02:52.840 --> 00:02:57.080 be like without government regulators, you know, all the things that we would have that 36 00:02:57.080 --> 00:03:01.680 don't exist because the government has made it impossible for those things to exist. It 37 00:03:01.680 --> 00:03:05.400 requires a certain level of abstract thought to think about economics. It's a difficult 38 00:03:05.400 --> 00:03:12.400 science. I once asked my friend Tom Woods, why is it so difficult for people to understand 39 00:03:12.400 --> 00:03:18.360 such, you know, easy things like, for example, the minimum wage law, 40 00:03:18.360 --> 00:03:23.760 you know, makes it more difficult for marginal workers to get hired and increase unemployment. 41 00:03:23.760 --> 00:03:29.040 He said, Jeff, there's an easy answer to why that's so, because it requires two steps of logic 42 00:03:29.040 --> 00:03:34.800 and that, you know, rules out the vast majority of humanity right there, you know. 43 00:03:34.800 --> 00:03:39.080 So anyway, you're interested in economics, that puts you in a 44 00:03:39.080 --> 00:03:43.920 and a special category of person, you know, so if you learn a few things here today 45 00:03:43.920 --> 00:03:48.080 you can know for sure that you're wiser than your fellows. 46 00:03:48.080 --> 00:03:52.640 I very much appreciated Mark's lecture. I don't know how many of you 47 00:03:52.640 --> 00:03:56.560 have followed anything I've written 48 00:03:56.560 --> 00:04:01.600 over the last few years, but I get very excited about these consumer product issues, 49 00:04:01.600 --> 00:04:05.360 you know, like this ring around the collar thing that he was... 50 00:04:05.360 --> 00:04:08.520 I mean, I was sitting there in the back just getting angry, you know, 51 00:04:08.520 --> 00:04:13.320 I don't know, did you feel that sense of... Mark didn't seem sufficiently angry about it, actually, I must say. 52 00:04:13.320 --> 00:04:16.720 It was a great presentation, but you weren't just riled up about it. 53 00:04:16.720 --> 00:04:21.520 I was just fuming as I was hearing this story, you know, and I can think of a thousand other stories like this. 54 00:04:24.720 --> 00:04:31.320 Because, you know, the fate of the consumer is in many ways the fate of civilization itself. 55 00:04:31.320 --> 00:04:41.840 Ludwig von Mises, during his last 30 years or so, and he died in 1973, so all throughout 56 00:04:41.840 --> 00:04:50.960 the 1950s and 1960s, he was often asked to write articles for popular publications. And 57 00:04:50.960 --> 00:04:56.440 back in those days, there was a big debate, if you can believe it, about whether or not 58 00:04:56.440 --> 00:05:01.440 that we should have capitalism or communism, you know. 59 00:05:01.440 --> 00:05:05.880 Actually, rumor has it that that debate is still going on 60 00:05:05.880 --> 00:05:09.120 at the university here, but in any case, 61 00:05:09.120 --> 00:05:11.680 for most of mankind, that debate's been largely settled, 62 00:05:11.680 --> 00:05:14.400 but in those days, it was a big deal. 63 00:05:14.400 --> 00:05:19.040 So he was often asked, could you please share your insights, 64 00:05:19.040 --> 00:05:21.800 Professor Mises, you know, this aging professor, 65 00:05:21.800 --> 00:05:30.800 and almost all of the articles he wrote... Mark, do you remember what he would often write in these years? It was very interesting. 66 00:05:30.800 --> 00:05:39.800 He quite often returned to the same theme again and again. Now, you might say, why would he keep writing the same thing again and again? 67 00:05:39.800 --> 00:05:42.800 Well, there wasn't the World Wide Web where people could check this stuff, right? 68 00:05:42.800 --> 00:05:49.800 I mean, so, he wrote for one publication and it reached like, you know, a few hundred people and that was it. 69 00:05:49.800 --> 00:05:55.100 The article just stopped, you know, so then some other publication would write you and say we'd like you to write an article 70 00:05:55.100 --> 00:05:59.440 So you'd write another article on the same theme and that reached another, you know, a few thousand people and it would stop 71 00:05:59.440 --> 00:06:05.040 That was the way the old world worked, you know, the world the words just kind of like hit a hit a wall and like fell 72 00:06:05.040 --> 00:06:07.400 Down and crashed. I mean that was the end of it, you know 73 00:06:07.400 --> 00:06:13.240 It's not like today where everything you write is just instantaneously swirls around the world and keeps doing this forever and ever 74 00:06:13.240 --> 00:06:16.400 So it's that's why Mises would write the same thing again and again 75 00:06:16.400 --> 00:06:46.400 And the theme that he makes sense that here you've got this amazing aging professor, great economic genius of the world, and he has one chance to tell people in one sector of society one thing that he thinks is the most important thing, what did he constantly go back to again and again, which I assume to his mind was the most important thing that he could possibly tell anybody. And again and again, he retains that. 76 00:06:46.400 --> 00:07:16.400 Let me turn to the theme that capitalism is mass production for the masses, that under capitalism, the consumer is king, he would put it like this, the consumer is sovereign, and he was very clear, he said, you know, this doesn't make the consumer, it doesn't have power, like in the way a king has, a real king has power, the consumer is, has power in the sense that all production that goes on in the market 77 00:07:16.400 --> 00:07:22.240 Economy is directed towards the well-being of the consumer. 78 00:07:22.240 --> 00:07:23.240 And who is the consumer? 79 00:07:23.240 --> 00:07:26.920 Well, the consumer is every one of us and really everyone on the planet. 80 00:07:26.920 --> 00:07:33.640 So he said, in that sense, capitalism is the system that serves the whole of society in 81 00:07:33.640 --> 00:07:36.480 the best possible way it can be served. 82 00:07:36.480 --> 00:07:39.280 And he continued to make this point again and again. 83 00:07:39.280 --> 00:07:45.560 And there are other points surrounding this issue, like it always annoyed him when people 84 00:07:45.560 --> 00:08:15.560 He would talk about the power of the capitalist, you know, the owner or the producer, and he says, you know, like, for example, people will say, oh, well, the Hershey company is the king of chocolate, and he'd say, well, it's not really the king, really, I mean, you can talk about, like, maybe being the number one distributor of chocolate or whatever, but a king has power, can tax, inflates, send people to war, chop off people's heads who, you know, 85 00:08:15.560 --> 00:08:24.560 The Chocolate King can't do any of that. In fact, The Chocolate King is a complete slave to the petty consuming public. 86 00:08:24.560 --> 00:08:34.560 The consuming public can make or break into any enterprise just solely on the decisions that people make on how they're going to use their money. 87 00:08:34.560 --> 00:08:42.560 It's a remarkable thing and I can't ever quite get over thinking about how profound this really is, 88 00:08:42.560 --> 00:08:49.560 Mises says that we have a system where every living person is in a position to influence 89 00:08:49.560 --> 00:08:55.480 what is done with the world's resources in every second, every day, all over the world. 90 00:08:55.480 --> 00:09:00.320 It sounds like, to my way of thinking, a utopian system. 91 00:09:00.320 --> 00:09:05.520 Mises was convinced that people didn't really understand it or else they would support the 92 00:09:05.520 --> 00:09:09.520 system we call capitalism. 93 00:09:09.520 --> 00:09:16.080 That's why he kept explaining it and again and again to people and I've reflected on 94 00:09:16.080 --> 00:09:19.700 this realizing that of course he was exactly right and maybe one of the reasons he had 95 00:09:19.700 --> 00:09:24.160 to constantly explain it again and again was because of the very name capitalism, right? 96 00:09:24.160 --> 00:09:30.000 This term capitalism sounds like a system that puts capitalists in charge, meaning those 97 00:09:30.000 --> 00:09:35.880 people who own the productive resources, the big machines or the land or whatever, you 98 00:09:35.880 --> 00:10:05.880 You know, have the most money, that they're in charge of society. This is, in fact, a terrible term for what Mises was describing, which is a system of mass production for the masses, where the whole of society, every unique individual in society has a chance to influence the direction of the course of affairs of civilization, which is what capitalism really is. But I don't know what the alternative word is. I mean, Mises might have proposed, what would you say? What would be an alternative to the word capitalism? I mean, consumerism? Yeah, okay. 99 00:10:05.880 --> 00:10:09.880 Well, but, I mean, that doesn't have a very good reputation either, right? 100 00:10:09.880 --> 00:10:13.880 The term consumerism? Consumerism? We're against that, too, right? 101 00:10:13.880 --> 00:10:16.880 Oh, well, too consumerist, you know. 102 00:10:16.880 --> 00:10:20.880 So we're against capitalism because, you know, whatever, and then we're against consumerism. 103 00:10:20.880 --> 00:10:22.880 I don't know what the alternative is, really. 104 00:10:22.880 --> 00:10:25.880 The right term, probably, is just free society. 105 00:10:25.880 --> 00:10:29.880 It would be the right term that we should use instead of consumerism or capitalism. 106 00:10:29.880 --> 00:10:32.880 Nonetheless, I kind of like this term consumerism. 107 00:10:32.880 --> 00:10:38.880 If by that you mean the system in which consumers are running the world, meaning all of us. 108 00:10:38.880 --> 00:10:46.880 But let me stop right there and go back to a scene that occurred to me a couple of weeks ago 109 00:10:46.880 --> 00:10:55.880 at Walmart, which is my favorite little miniature utopia in this world. I love Walmart. 110 00:10:55.880 --> 00:11:00.880 So I needed a set of headphones. I thought, where can I get them? Walmart, of course. 111 00:11:00.880 --> 00:11:04.480 and of course, well, you know, you don't know where to get something, get it at Walmart. 112 00:11:04.480 --> 00:11:08.440 So I drove to Walmart, sure enough they had a set of headphones, but before I got to the 113 00:11:08.440 --> 00:11:12.760 headphones, I got to the vegetable aisle where they have every kind of like amazing fruits 114 00:11:12.760 --> 00:11:19.240 and vegetables from all over the world and there was a guy going through the vegetable 115 00:11:19.240 --> 00:11:23.600 stand and he was hurling vegetables, you know, from the stand and fruits from the stand into 116 00:11:23.600 --> 00:11:27.000 a big basin, you know, he was hurling that, you know, boom, they were landing in this 117 00:11:27.000 --> 00:11:32.560 Basin and I just stopped and I tracked that this is unbelievable this is food 118 00:11:32.560 --> 00:11:37.440 what's going on here was this by God is buying all this stuff or what no it's 119 00:11:37.440 --> 00:11:42.640 throwing it away why is he throwing it away because it's a little bit old right 120 00:11:42.640 --> 00:11:45.760 it's got some like brown spot or something like the apples got a mushy 121 00:11:45.760 --> 00:11:49.920 thing or the bean has got a little thing on it or whatever so throwing all this 122 00:11:49.920 --> 00:12:05.920 Why is he doing this? Because Walmart is wasteful? No. Because the consumer doesn't want to see that stuff. You don't want rotten fruit. You don't want rotten fruit at the grocery store. That's why he's throwing it away. 123 00:12:05.920 --> 00:12:14.920 We're living in a civilization where we throw things away that are imperfect. It's an amazing thing. You see what's happened here? 124 00:12:14.920 --> 00:12:24.920 I mean, the whole history of humanity has consisted mostly, entirely, of the struggle to get enough to eat. 125 00:12:24.920 --> 00:12:28.920 That's the whole, if you want a summary of the whole history of humanity, that's it. 126 00:12:28.920 --> 00:12:31.920 How do I get enough to eat? That's what we're trying to do. We're trying to get enough to eat. 127 00:12:31.920 --> 00:12:38.920 Not a problem anymore, right? No, we throw it out if it's slightly imperfect. We want perfect things to eat. 128 00:12:38.920 --> 00:12:43.980 I mean, you're driving along and you get a hankering for a hamburger, so you just buzz 129 00:12:43.980 --> 00:12:55.500 up to the fast food place and you say, yes, please, I would like some beef from Argentina 130 00:12:55.500 --> 00:13:00.740 nicely ground up and mushed into a small patty and put it in there, and then some wheat grown 131 00:13:00.740 --> 00:13:05.740 in maybe Kansas and processed carefully to remove all imperfections and then fluffed 132 00:13:35.740 --> 00:13:40.740 We think nothing of it. What's the system that makes this possible? It's the system of the free market. 133 00:13:40.740 --> 00:13:45.740 And we think nothing of it. No! Contrary to nothing, we think ill of it, right? 134 00:13:45.740 --> 00:13:50.740 I mean, Google up fast food. I mean, everybody is against fast food, apparently. 135 00:13:50.740 --> 00:13:54.740 You know, I mean, all the intellectuals. Oh, this is terrible, you know, what they're doing. 136 00:13:54.740 --> 00:13:59.740 You're killing us by feeding us or whatever their theory is. I don't know. 137 00:13:59.740 --> 00:14:03.740 Oh, it's terrible. Look how fat we are. This is a disaster of humanity. We're fat. 138 00:14:03.740 --> 00:14:15.740 Well okay, you know, go on a run. I don't know what to tell you. But don't deny it's a system that provides this amazing food to the multitudes. This is a miracle happening. 139 00:14:15.740 --> 00:14:26.740 Anyway, back to my story of the headphones. I buy my headphones, by the way, on the way to the headphones I bought some apples and some t-shirts and a few other things. I fall for every marketing gimmick out there. I'm all for them. 140 00:14:26.740 --> 00:14:35.740 So I get it back, and so it's in this hard plastic container. Do you know the term wrapperage? 141 00:14:35.740 --> 00:14:45.740 Wrapperage. So I'm in there in the kitchen experiencing wrapperage. And I said, Mark, 142 00:14:45.740 --> 00:14:49.740 I think it's like, Mark Thornton, I said, Mark, it's like there's a market failure. 143 00:14:49.740 --> 00:14:53.740 Why can't they make this stuff easier to open? He said, well, in fact, there's a market reason 144 00:14:53.740 --> 00:15:04.740 The reason for that is it prevents tampering, I think was your view, what is it? Oh shoplifting, yeah not tampering, shoplifting. How does that prevent tampering? You have to tell me about that later. 145 00:15:04.740 --> 00:15:15.740 Anyway he had some complicated theory, explained to me the reason why things are packaged the way they are. Oh because it makes the package bigger. Right, okay, there you go, and you can't haul the thing out. 146 00:15:15.740 --> 00:15:33.740 I'm fed up with this. I got a knife and I began to saw it. You can't believe it. I got it out of the package, got it up to my office and realized I had cut the cord in half with my knife. I just sliced right through it. I'm an idiot. 147 00:15:33.740 --> 00:15:39.740 Okay, so, I don't know what the deal is with cords these days. 148 00:15:39.740 --> 00:15:42.740 They're very, I mean, what do they contain, like, fiber optics or something? 149 00:15:42.740 --> 00:15:46.740 I mean, you can't, so when I was young, if you cut a cord, it was no problem at all. 150 00:15:46.740 --> 00:15:50.740 You know, you just kind of, like, remove some insulation and tie them back together, 151 00:15:50.740 --> 00:15:54.740 use a little scotch tape and, you know, stick it back together, and it worked again. 152 00:15:54.740 --> 00:15:57.740 Okay, that's apparently not true anymore. 153 00:15:57.740 --> 00:16:13.740 Because I'm embarrassed to even admit it, but I tried it and I thought, well, it's not a problem, you know, and I kind of opened it and I thought, well, there's some complicated stuff in there, you know, but anyway, surely it works, and I put some scotch tape. Of course it didn't work. 154 00:16:13.740 --> 00:16:43.740 And so I sat there, just as bad off as I was before, for a few hours thinking, I still have to get my headphones. This doesn't work. How am I going to explain this? I was nervous to have to explain this even to Doug because I had actually spent, I think, 20 bucks or something at the Institute money on this thing because I had justified it. So he said, well, go take it back. I thought, well, this is embarrassing. Am I going to go back to Walmart with my thing? 155 00:16:43.740 --> 00:17:13.740 I thought, well, I've got to at least attempt it and my boss, after all, told me to go take it back, so I'm going to take it back, so I went back and I'm standing in line, so I'm at this weird area of Walmart, this is not vegetables, this is not t-shirts, this is not electronics, this is returns, okay, so this is a very interesting place because they've got like two or three cash registers with these employees that just, whatever they're paid, it's not enough and there's people standing behind the register and 156 00:17:13.740 --> 00:17:23.740 And they're carrying, just lugging on all this junk. I mean, toys that the kids were playing with or something, and then they stepped on it or spilled syrup on it or whatever, and they're bringing it back. 157 00:17:23.740 --> 00:17:30.740 Clothes that clearly a person wore the night before to their special party or whatever, now they're going to get their money back on them. 158 00:17:30.740 --> 00:17:35.740 Idiots who, when opening their headphones, cut the cord. 159 00:17:35.740 --> 00:17:41.980 and so anyway I stand there dutifully you know feeling like and I got up to 160 00:17:41.980 --> 00:17:45.580 the register I said look I don't know why I'm here this this is entirely my 161 00:17:45.580 --> 00:17:50.300 fault I sliced right through this cord open it up is nothing you did I was 162 00:17:50.300 --> 00:17:55.100 reckless and I totally understand if you don't want to take this back but I feel 163 00:17:55.100 --> 00:18:00.340 like I just have to perform this ritual in a perfunctory way she's oh sure glad 164 00:18:00.340 --> 00:18:04.260 to take it back you know and bring it up and in a matter of you know 20 seconds I 165 00:18:04.260 --> 00:18:10.260 I have my money back. And that was it. She said, go pick out another one and ring it up like you normally would. 166 00:18:10.260 --> 00:18:20.260 And I walked away from this just stunned. And I hung around a little bit longer and just kind of observed what all the consumers were saying to the return people. 167 00:18:20.260 --> 00:18:30.260 Now, consumers are remarkable people. They really do believe that they are running the world, the consuming public. 168 00:18:30.260 --> 00:18:41.260 It's like, you know, the guy drives off from the amazing fast food place and complains they didn't get one pickle instead of two or whatever, you know, we're just, we just demand so much from the producers. 169 00:18:41.260 --> 00:18:53.260 And so it was at Walmart with all these people standing in line there, and every one of them is, you know, basically they're lying, a lot of them are lying, but Walmart pretends to believe their lies and gives them their money back, and then time after time after time. 170 00:18:53.260 --> 00:19:06.260 Now, I'm looking at the scene. Now, where else have you seen a scene where you've got two, three, four people seemingly in charge, you know, behind some counter and lines lined up against them in a long thing like this? 171 00:19:06.260 --> 00:19:16.260 Okay, my mind went back to the last time I took a flight, right? How many of you have flown an airplane, right? So we've got the TSA, right? We've got the TSA, a very similar setup. 172 00:19:16.260 --> 00:19:25.020 Physically, they're basically the same, you know, just people in charge behind counters 173 00:19:25.020 --> 00:19:30.820 and then people lined up behind them, but two very different kind of dynamics at work. 174 00:19:30.820 --> 00:19:36.440 And one, at Walmart, the people behind the counter are there, you know, in a slavish 175 00:19:36.440 --> 00:19:41.380 way serving the masses, and the masses are in charge, you know, the person who gets up 176 00:19:41.380 --> 00:19:46.180 there, you know, is clearly in charge of the situation in this kind of retail environment. 177 00:19:46.180 --> 00:19:50.500 The TSA on the other, and they're very demanding, and they mouth off, you know. If it takes 178 00:19:50.500 --> 00:19:54.260 too long, hey, why are you taking so long? You know, everybody's got, you know, angry 179 00:19:54.260 --> 00:20:00.020 words sometimes for the person at Walmart. The TSA is completely different. These are, 180 00:20:00.020 --> 00:20:04.380 presumably, it could be the same people, but we behave completely differently. It's like 181 00:20:04.380 --> 00:20:11.740 there's an awareness that the consumer is not sovereign in this case. We're afraid. 182 00:20:11.740 --> 00:20:18.980 You know, we spend a long time in lines getting up to the TSA, then the person looks at our 183 00:20:18.980 --> 00:20:24.460 documentation with this careful magnifying glass and checks our, you know, a little infrared 184 00:20:24.460 --> 00:20:25.460 thing. 185 00:20:25.460 --> 00:20:29.740 It's probably all fake, but anyway, they do all this weird stuff, you know, and they're 186 00:20:29.740 --> 00:20:33.020 looking at our papers, making sure that everything's aligned right, or whatever. 187 00:20:33.020 --> 00:20:36.300 Then they give us permission and we say, oh, thank you, you know, and we don't dare say 188 00:20:36.300 --> 00:20:38.460 anything else. 189 00:20:38.460 --> 00:20:39.900 Like you would never insult the person. 190 00:20:39.900 --> 00:20:43.740 Hey, why are you taking so long? I've been waiting in this line 10 minutes. 191 00:20:43.740 --> 00:20:46.460 I mean, what do you risk if you do something like that? 192 00:20:46.460 --> 00:20:50.300 I've been here waiting 15 minutes for you jerks, you know. 193 00:20:50.300 --> 00:20:53.340 What if you said that to the TSA? To the end of the world. 194 00:20:53.340 --> 00:20:55.580 I mean, no telling what would happen to you. 195 00:20:55.580 --> 00:20:58.540 You know, you can look on YouTube and see the results of this stuff. 196 00:20:58.540 --> 00:21:03.340 I mean, it's a complete opposite system. 197 00:21:03.340 --> 00:21:06.620 I mean, it's like an inversion. It's like Alice in Wonderland or something. 198 00:21:06.620 --> 00:21:09.180 It's like a complete inversion of the capitalist system. 199 00:21:09.180 --> 00:21:15.820 And so it is in every situation where you encounter the public sector, essentially. 200 00:21:15.820 --> 00:21:21.020 Now, this is not to say there aren't some very nice, sweet bureaucrats and some very wonderful 201 00:21:22.540 --> 00:21:26.700 driver's license bureaus somewhere, I mean, you know, but they're very volatile. 202 00:21:26.700 --> 00:21:32.460 They're always on the verge of tipping into being a sort of Nazi-like, you know, at every moment. 203 00:21:32.460 --> 00:22:02.460 I remember I was trying to get my little girl, a driver's permission thing or whatever, and I was over at the DMV and I arrived up at 9 a.m. and I stood there for a very long time observing what seemed chaos, you know, like everybody was just milling around, there was a guy in charge, somebody behind a desk who wasn't speaking to anybody, everyone was like a growl or something, 204 00:22:02.460 --> 00:22:06.540 I stood there for a long time. I mean, nobody comes up to you, like, at the clothing store, 205 00:22:06.540 --> 00:22:12.780 a guy comes up to you and says, can I help you, sir? And we say, get away from me, you parasite, 206 00:22:12.780 --> 00:22:16.860 trying to get me to spend my money on things. You know, I just want to look for myself, all right? 207 00:22:18.140 --> 00:22:22.700 Now, while driving through the Bureau, nobody's coming up to you going, can I help you, sir? No, 208 00:22:23.260 --> 00:22:29.580 that doesn't happen. So, I sought somebody out who was in charge. I said, I'm sorry, I'm vaguely 209 00:22:29.580 --> 00:22:33.580 I'm really confused about what's going on in this building. 210 00:22:33.580 --> 00:22:37.580 I don't really know what to do. 211 00:22:37.580 --> 00:22:41.580 He said, take a number. 212 00:22:41.580 --> 00:22:45.580 Believe it or not, they have one of these wheels that spins 213 00:22:45.580 --> 00:22:49.580 with paper tickets coming out of it. So I have to go over to the corner 214 00:22:49.580 --> 00:22:53.580 and I'm ready to take a number and the number was something like 89. 215 00:22:53.580 --> 00:22:57.580 And right before I pulled the 89 number, I heard 216 00:22:57.580 --> 00:23:06.700 So, I asked somebody, I said, some person who like had cobwebs on them, you know, sitting 217 00:23:06.700 --> 00:23:09.780 in a chair like this, how long have you been here? 218 00:23:09.780 --> 00:23:14.620 He said, oh, well, we got here at 6 a.m. this morning, you know, and what number are you? 219 00:23:14.620 --> 00:23:19.220 Well, I'm like number 31. 220 00:23:19.220 --> 00:23:23.340 So I took my little girl, I said, we've got to think of something else to do, you know, 221 00:23:23.340 --> 00:23:53.340 The State is built by regular people. The same people who are working at Walmart could also be working for the DMV or the TSA or anywhere else. It's not a difference in human nature. It's not like bad people in the state, good people in the private sector. These are all just people. It's not like we are in charge of the world when we're returning our goods after destroying them. 222 00:23:53.340 --> 00:23:57.380 and you know to the Walmart returns counter and then suddenly we arrive at TSA and we 223 00:23:57.380 --> 00:24:02.260 feel you know like slaves and we behave like slaves, we have a personality transplant. 224 00:24:02.260 --> 00:24:09.260 No, the only difference is an institutional difference. In one institution, the market, 225 00:24:09.260 --> 00:24:14.700 the consumer is in charge of all productive activities and the other in the state, the 226 00:24:14.700 --> 00:24:21.080 state is in charge of everything, whether it's productive or not and mostly it's not. 227 00:24:21.080 --> 00:24:34.080 So that's the only difference between the two systems, and those are the only two systems really that exist, that's essentially our choice, and has always been our choice from the beginning of time. 228 00:24:34.080 --> 00:24:56.080 Now reflect on what it is that economics contributes by observing the existence of a system in which the masses, the whole of society, all individuals in society are essentially in charge of the shape of civilization, what gets produced, how much gets produced. 229 00:24:56.080 --> 00:25:05.080 I mean, by observing this, economics discovered something unbelievable and unprecedented in all of human history. 230 00:25:05.080 --> 00:25:15.080 If you go to your political science classes, you're going to learn what every political philosopher has said since the beginning of the printed world, from the ancient world to the present. 231 00:25:15.080 --> 00:25:19.080 And almost all of them get it wrong. 232 00:25:19.080 --> 00:25:38.080 They all believe that the right means to the just, beautiful, prosperous, moral society is somehow changing, manipulating, adjusting the state in some respect. 233 00:25:38.080 --> 00:25:46.080 And very few have ever bothered to look outside of that and notice that all the goals that they want, 234 00:25:46.080 --> 00:25:52.000 A just society, a free society, a prosperous society, a moral society is achieved not within 235 00:25:52.000 --> 00:25:56.260 the state structure but completely outside of it. 236 00:25:56.260 --> 00:26:04.200 This is an essential problem, intellectual problem, of the history of the printed word. 237 00:26:04.200 --> 00:26:08.840 I'm just now reading a book by Francis Fukuyama called, this is his new book, it's number 238 00:26:08.840 --> 00:26:12.900 eight on the New York Times bestseller list, it's called, you know, something like the 239 00:26:12.900 --> 00:26:18.060 The origin of political order, okay, so I'm plowing through this gigantic book, 800 pages, 240 00:26:18.060 --> 00:26:26.020 which ends by saying that there's going to be a volume two, which, you know, I do this 241 00:26:26.020 --> 00:26:28.660 and I'm still not finished, you know. 242 00:26:28.660 --> 00:26:32.620 There's not a page in this thing that actually addresses this key problem. 243 00:26:32.620 --> 00:26:37.580 He, like most all political flossers in all of human history, have tried to solve all 244 00:26:37.580 --> 00:26:42.140 the problems of humanity by looking at the wrong sector of society. 245 00:26:42.140 --> 00:26:45.740 They're looking at the state and failing to notice the market. 246 00:26:45.740 --> 00:26:50.620 You know, it's like political philosophers are like people who observe, you know, something 247 00:26:50.620 --> 00:26:56.500 like a house having been built and trying to understand how that came to be and thinking, 248 00:26:56.500 --> 00:26:59.380 well, you know, we need a society of these houses. 249 00:26:59.380 --> 00:27:03.760 And then some one of them observes that, you know, it seemed to have gone up in the spring. 250 00:27:03.760 --> 00:27:09.100 During springtime, this house seemed to have emerged from the ground. 251 00:27:09.100 --> 00:27:15.140 What can we do to make sure that spring lasts a little longer, maybe begins a little earlier, 252 00:27:15.140 --> 00:27:18.540 and maybe lasts a whole year, and they spend all the rest of their time puzzling about 253 00:27:18.540 --> 00:27:19.540 the weather? 254 00:27:19.540 --> 00:27:25.060 I mean, it's essentially a failure to understand cause and effect, you know, without understanding 255 00:27:25.060 --> 00:27:29.660 that no, actual humans built the house and they did it for a reason, you know. 256 00:27:29.660 --> 00:27:35.420 That's essentially what economics addresses, and that's its great contribution. 257 00:27:35.420 --> 00:27:44.020 Now, I would like to return finally to what is essentially the burning question in our 258 00:27:44.020 --> 00:27:48.940 times today, since nobody is actually proposing that the state run all of society, although 259 00:27:48.940 --> 00:27:54.940 some people do, and very few apart from those associated with the Mises Institute advocate 260 00:27:54.940 --> 00:27:57.100 that the market run the whole of society. 261 00:27:57.100 --> 00:27:59.260 Most people believe that we need something in between. 262 00:27:59.260 --> 00:28:06.540 So we need like some kind of intermediary force between the producer and the consumer. 263 00:28:06.540 --> 00:28:11.500 And I would deny, as with Mises, that this is true at all, and that the more things you 264 00:28:11.500 --> 00:28:21.660 put between the producer and the consumer, the more regulations, the more tools of coercion 265 00:28:21.660 --> 00:28:25.780 you put between those two things, the worse off the system is going to be. 266 00:28:25.780 --> 00:28:29.580 And the more direct the connection is between the producer and the consumer, especially 267 00:28:29.580 --> 00:28:35.260 if the intermediaries are voluntary institutions like Consumers Reports or reviews on Amazon 268 00:28:35.260 --> 00:28:39.020 or whatever it may be, the more efficient and wonderful the relationship between the 269 00:28:39.020 --> 00:28:40.800 producer and the consumer is. 270 00:28:40.800 --> 00:28:47.300 Because it's in the interest of all producers to serve the consumer in the best possible 271 00:28:47.300 --> 00:28:48.660 way. 272 00:28:48.660 --> 00:28:54.700 This simple claim is denied constantly and always. 273 00:28:54.700 --> 00:29:02.020 I mean, after all, we have a thousand regulatory bureaucracies in Washington erected on the 274 00:29:02.020 --> 00:29:08.460 belief that it's not true that producers are desperate to serve consumers. And I tell you, 275 00:29:08.460 --> 00:29:14.300 they do nothing but menace in this world. And Mark mentioned one of them. They've destroyed 276 00:29:14.300 --> 00:29:20.820 our ability to keep our clothes clean. Alright? This is a problem. This is a problem. That's 277 00:29:20.820 --> 00:29:41.820 That's only the beginning. I wish I had time to go into it, but Doug has failed to give me three hours to talk, but I would like to talk at some point about the problem of dirty dishes, a very serious matter, whether or not we're eating off clean dishes or not. 278 00:29:41.820 --> 00:29:52.820 And a small regulatory change that has taken place within the last 12 months have made it nearly impossible for us to get our dishes clean, if you can believe it. 279 00:29:52.820 --> 00:29:58.820 And I know people who have replaced their dishes thinking, I guess my dishes are just permanently dirty. 280 00:29:58.820 --> 00:30:00.820 I better buy some new ones. 281 00:30:00.820 --> 00:30:05.820 Or they replace their dishwashers and say, well, I guess my machine mysteriously broke over the last 12 months. 282 00:30:05.820 --> 00:30:10.420 and they replace it with a machine that works even less well because regulations make it 283 00:30:10.420 --> 00:30:19.960 consume even less water and this has happened to millions of Americans and very few people 284 00:30:19.960 --> 00:30:25.880 have noticed that the problem lies not with the machine or with their dishes but with 285 00:30:25.880 --> 00:30:33.020 their dish washing detergent which on the back of the bottle prints in very small letters 286 00:30:33.020 --> 00:30:46.020 This is very bad. Phosphorus-free is very bad. It means that your dishwashing detergent will not work. 287 00:30:46.020 --> 00:30:49.020 It means that it will make your dishes much dirtier. 288 00:30:49.020 --> 00:30:52.020 Now, I was listening to some guy on the television the other day. 289 00:30:52.020 --> 00:31:00.020 He says, well, we have to have phosphorus-free detergent because we have to keep the fish healthy. 290 00:31:00.020 --> 00:31:30.020 And I'm thinking, okay, like, you know, I'm imagining this. So, the fish are supposed to be healthy and happy, probably eating off clean plates and clear crystal, you know, in the bottom of the lake or whatever, but we're up here, you know, eating off dirty, bacteria-ridden, gritty things, you know, and this is the world you want, you know, this is what your beloved regulations are creating for us, happy, civilized fish, dissatisfied, uncivilized human beings, you know. 291 00:31:30.020 --> 00:31:36.020 There's something wrong with this system. In any case, it turns out to be a myth that there's any relationship between phosphorus and the health of fish. 292 00:31:36.020 --> 00:31:49.020 In any case, I was very pleased to be able to go to Walmart, actually, and discover that you can buy phosphorus on your own. 293 00:31:49.020 --> 00:31:57.020 A little box, about a five-pound box, brought it home, cut off the corner of it, put a little tablespoon into my dishwasher, and like magic. 294 00:31:57.020 --> 00:32:04.020 I felt like my childhood restored. I held up the glass to the light and observed the beautiful glass at long last. 295 00:32:04.020 --> 00:32:13.020 So you have to do this in life. You have to find the work around to these idiotic barriers that the state has put up in front of us to ruin our lives. 296 00:32:13.020 --> 00:32:25.020 Be smart about them. Think about them. Understand cause and effect. Find the work around and you can live a prosperous, happy, healthy life. 297 00:32:25.020 --> 00:32:30.020 because you can, on your own, help restore this relationship between the producer and the consumer. 298 00:32:30.020 --> 00:32:35.020 But, if you don't understand economics, and you're not alert to what it teaches, 299 00:32:35.020 --> 00:32:41.020 you can go about your life with wringing around the collar, with gritty, dirty dishes, 300 00:32:41.020 --> 00:32:48.020 and, even worse, a state of unbelievable ignorance about what it is that causes civilizations to rise 301 00:32:48.020 --> 00:32:53.020 and civilizations to fall, which is why I'm grateful for your presence here today. 302 00:32:53.020 --> 00:32:55.020 Thank you so much.