Hello, and welcome back to another edition of the Federalist Radio Hour. I'm
Sam Miguel Then, a staff editor at The Federalist Don't Forget. You can
email any comments or questions for the show to radio at the Federalist dot com,
follow us on Twitter at FDRLST, and make sure to subscribe wherever you
download your podcast as well. Today I am joined by Though Bishop, communications
director at the Mises Institute. Mises is a libertarian think tank that was chartered
to promote the contributions of famed economist Ludwig von Mises that its founders believe are
being overlooked by the libertarian movement at large. Today, Thoe and I will
be discussing some different aspects of monetary and fiscal policy, including the US's diminishing
role as the economic hegemon, why people are still so obsessed with the bitcoin,
and how the US can integrate cryptocurrency into its monetary policy. I hope
you enjoy the show, so welcome. How's your day going doing great?
Thanks for having me, Nebron at least for coming on. So I was
wondering if we could start off with a brief explanation as to Mises institutes Niche
and how you guys are different than other libertarian organizations. Yes, it was
interesting, first and foremost we are far out of the Bolt way. We're
down in Auburn, Alabama, and I think it has been to our benefit
in a variety of ways. What's interesting, though, is that you know,
within the libertarian movement, I think there's really kind of two strands of
what you might call libertarianism itself. On the one side, I think you
have the sort of school of thought that I think is articulated by most of
the people at Reason, increasingly so at CATO, and it kind of views
lib libertarianism almost like as a as a self It's it's a it's a very
liberal philosophy like self empowerment and a the ability to make yourself into whatever it
is you want to be. Therefore, it is very hostile to religion,
very hostile to borders, hostile to nation, very self actualization, I think
as a guiding philosophy there. In fact, Nicolspie, who disagree with strongly,
but I think he's very articulate with how he used libertarianism. A few
years ago he said that he used libertarianism as the promotion of alternative lifestyles,
and therefore, if everyone can explore whatever lifestyle they want, then that is
what true liberty is. The Mesa's Institute our background, so lud von Mesas
was born in the Habsburg Empire, right, he was a man of old
Europe, and his view of liberalism was grounded very simply in property rights and
a respect for what we might call natural order. So a lot of our
scholars, when we talk about political order, there is a view that society
should elevate so that that naturally that there are people with great skill, with
great investment in their communities, people that are generally wise, and that society
or that that freedom comes from the order that wise leadership truly provides. That
property rights are the foundation of social cooperation. And so you know, I
know the bookie term out there of like libertarians or they care about themselves and
you know, the often childless and that sort of stuff. I think the
Institute orbit we have a great respect for the role that religion places a society,
that history places in society, that nation mysus, you know. After
World War One he wrote about the importance of kind of liberal nationalism and language
groups and the destructive nature of having people from outside within, particularly within a
very introventional this government taking control of this state and using it to promote the
tools and policies that go against sort of the historical interests of a society there.
And so that has led to more of a social conservatism, often affiliated
with the institute of great respect for religion, particularly Christianity, a recognition that
Christianity is what made Europe great helped create that foundation of respect for liberty in
the first place. And so while there was a time I think where both
libertarians of say the Reason crowd and the Mesa's crowd, there's a lot of
exploration and sort of the technosphere and sort of the private cities and things like
that, and I think all of those are still very interesting projects, given
the degree to which cultural issues have really been pushed to the forefront, and
I think those cultural issues are subsidized by the state. The Institute crowd,
the Mesa's Institue crowd, I think as has become increasingly distanced and attacked,
and the attacks of both ways. I'm not kind of trying to portray one
side as being more hostile than the other. There's libertarians are very good at
infighting in its own right. Um, but I think a recognition that the
state has been used to push society to the cultural left, and I think
there are many people within some of these organizations that are okay that that celebrate
that cultural shift. They would just simply rather have it privatized, and so
that kind of rather than than some of the more heavy handed aspects of the
state. And so that leads to some of the debates going on right now
with you know, what is the proper way of dealing with the company like
Disney and Florida, Well, what is the proper way of dealing with private
tyranny in the form of vaccine mandates and things like that. The reason Cato
crowd were very defensive of privatized versions of this, whereas the Institute crowd,
you know, was kind of the perspective that know that these are these are
agents essentially of the regime and should be treated as such. And so I
think that's how these broader philosophical differences have manifested itself in very practical ways and
why you see again an increasing divide that it's kind of always been there within
these different libertarian factions. Very interesting. It kind of reminds me of the
how there's always a inflation of, or rather a misassociation of libertarianism with libertinism.
How there's like, how you guys are trying to differentiate, you know,
social conservatism is kind of it seems paramount into establishing a more free society
in a lot of regards than just allowing the worst of human nature to run
amuck within us. Well, I think that's kind of yeah. I think
the irony comes in where if you recognize that the state's role in society should
be as limited as possible, which is some theory kind of the libertarian default
political position, then the other side of it is whatever places that right.
Liberited government only works if we have self governing individuals, and there are institutions
within society, be at the church, being civic groups, be at families,
that's they're supposed to fill that role. And so if you have no
respect for those intermediaries civil society institutions, then what's gonna happen is the state's
gonna get bigger and bigger. And I think that's that's a massive blind spot
that comes from some of the cultural differences there, and that's something that even
goes back to the Founding. You know, the founders were very aware of
the fact that self governance wasn't just you know, city councils and school boards
of those are paramount to this experiment, but it comes down to the individual.
You have to be able to self govern yourself so you can achieve your
own freedom. You know, I'm of the inclination that alcoholism and addiction is
a you know, um neurobiological disease, and I think we're kind of we've
very much discovered that it is. But if you don't have the ability to
govern your impulses and exert control over your will, then you can't even govern
yourself. So how can you govern a community or let alone a nation.
And I think one of the problems, and it is extended, I think
to some of the the economic skepticism on the right right now with capitalism or
las fair or whatever term you want to use. That those that have defended
capitalism the most vocally, those in the opinion pages the Wall Street Journal,
those within all these DC think tanks, They have often resorted almost to those
purely materialistic sort of defense of you know, free markets, and so you
know it's like, oh, well, you know, cheap stuff from Walmart,
you know, is the greatest measure of success. And I'm not dismissing
cheap stuff from Walmart if you are poor, like that can really make your
day to day life. But but number go up, you know, stunks
going up like that's not a measure of a healthy society. And I think
that what I would the branch of American political thought I really identify with as
the old Jacksonians, because the Jacksonians were very wise in terms of economic issues.
There was some some proto Austrian which is kind of the school of economics
of the means Instwo promotes um. There was a lot of proto Austrian thinking
within the intellectuals of the Jacksonian movement movement, people like William Leggett Um and
some of the Martin van bur and some of the minds behind the throne of
the Jacksonian presidency that very much baked in Christian morality, that free markets were
necessary to allow for Christian morality to actually be more governing powerful influence in the
American society because of the corruption of cronyism and the financial class and things like
that. And so if liberty is defined and defended purely on these materialistic grounds.
Then those that see the meaning crisis that we have in society. Um,
you know, generations of Americans that are so desperate to not become,
to not be who they are, that they're willing to mutilate themselves at a
young age, um that engage in self destructive behavior. That's something very wrong.
And if your only view as materialistic and look look at how you know
these I can order something from my phone and have it show my doorstep,
that that burrito shows up in twenty five minutes, that's that's you know,
that's not a free society. That's not a healthy society. And that's your
only argument there. Obviously you're gonna have people of questioning the you know,
the the fulness the utility of it. Right, And I was running up
on some of what mesus um what literally on visas was, what is um?
What his theories were, and the notion of deductive economics I thought was
particularly fascinating going off. You know, how that the Christian morality behind the
Jacksonian m presidency end up being baked into the proto Austrians. It's interesting how
there's this unique emphasis on human nature in the economic theory as opposed to just
empiric analysis, which is numbers scope on a spreadsheet, numbers wore down on
a spreadsheet, you always wanted to inch upwards. It's very we've very much
gotten away from that. And granted, I'm not entirely sure. I'm not
an economist, so I can't say for sure which is the objective better,
um, but it seems as though a blending of the two ought to be
preferred, because you can't really at the end of the day, economics is
a it very much deals with human nature at its core. It's we're not
fully automated yet, although with AI I'm sure we'll get there at some point,
but you still need to account for the human factor and human nature being
incredibly chaotic. That seems like a very crucial thing in a society that you
can't escape no matter what, right, And I think that's why there's kind
of this crisis with an economics of like what really is the value there?
Because you know you have all these you know, very serious Ivy League drained
economists at the central banks, which are not only at the FED, their
international one of America's best exports. That has been really bad thought from Ivy
League universities, and there really was this great revolution and think I'm a tragic
revolution and thinking during the twentieth century, you know, kind of pioneered by
John Maynard Keynes and his followers that really kind of amplified this very mathematical approach
to economics at the expense of the very class some of the classical economists in
the Austrian school, they made great, i think, advancements from the neo
classicals, the Adam Smiths of the world. But the methodology is a lot
more similar there. And that is I think, really the methodology of economics
is really what separates us from all all other branches of thought. And so
you know, when people think about capitalism, often they'll think about like Milton
Friedman. But Milton Friedman, though he was a skeptic of government and a
free market guy and a prophet of capitalism or whatever you want. Your propagandist
of capitalism might be a more accurate term, he was a Keynesian. His
methodology was that. In fact, fa Hiak when he came to the University
of Chicago after his world renowned tour with Rhad to Serfdom, he was not
allowed to teach economics classes at the University of Chicago. He's focused on political
theory and things like that because Milton Freeman didn't want him in there, and
so the Mesa's approach, it's it's funny because I mean Ludava Mesas when he
came to America during World War Two as well as a Jewish refugee from you
know, from Austria, he couldn't get a teaching job in the US in
spite of being this world renown economist because of how quick the Keynesian Revolution took
over American universities, you know, FDRs America. You know, he had
he had a teaching gig at NY that was paid for by donors rather than
the school. And I think that the economic denialism that I think has kind
of baked in both the left and the right, you know, both sides,
and I think understandably so they kind of view economics increasingly a sort of
a propaganda tool, you know. Either that's a propaganda of of big business,
just the five round existence on the left. On the right it's a
propaganda you know, also of a big business, but maybe government itself.
Um, and it comes from just a complete breakdown of the value economic theory.
I mean, you can get a PhD in economics now without any sort
of background in economic history, very little theoretical work. It's all stats driven,
and so it pops up. Like even even over the weekend during the
NFL draft, ESPN had called these models about probability and you know, when
a player was being drafted here, and of course most of it completely didn't
work out because it turns out that mathematical models can't forecast what a team is
going to do. And you know, this one thing is a look kind
of a little sports novelty there, and you kind of see it. You
know, during sports season all this team had a ninety nine percent chance of
losing until this one play happened and then they won. It's like, oh,
well, you know, maybe it wasn't really maybe number it wasn't useful.
That sort of thinking, though, is baked into the financial modeling of
central banks, and when you realize just how blind they are, not only
blind, but arrogant they are about the usefulness of these models. That's why
we have the world that we have ourselves in with a bunch of decay and
a bunch of financial instability, because we've lost that appreciation for human nature,
human action, and so that's why I think there's value there. You know,
the problem with economic literacy at such a young age, I think,
is why the left is able to take advantage of so much confusion and frustration,
because we've created generational problems, generational trauma from the bad state of the
financial world, which are driven by these very false assumptions that economists on both
the nominal left and right have assumed from this methodological methodological failing. The Washdotor
on Wall Street podcast with Chris Murkowski. Every day Chris helps unpack the connection
between politics and the economy and how it affects your wallet. If someone told
you the recessions started today, would you change anything about your daily life?
Has the big recession monster already arrived? Don't be fooled by what you read.
Docs tend to outperform during your recession anyways. Make sure you're getting the
most trustful information, whether it's happening in DC or down on the Wall Street
it's affecting you financially. Be informed. Check out the Watchdout on Wall Street
podcast with Chris Markowski on Apple, Spotify, or wherever you get your podcasts.
For sure but you know, going off of that, just speaking about
economic literacy, and you know how we're in a seemingly death spiral right now
with the FED. What are your thoughts on the diminition role of the US
dollar abroad? You know, with the bricks system seemingly existing to undermine the
US as the economic hegemon, and with more and more international deal is being
conducted in you on, what are your thoughts what does it look like with
the US as the reserve currency moving forward? There's there's real threats out there,
and of course you have a lot of people that that dismiss it,
and that will point to all sorts of from a purely economic analysis, right,
the skepticism of something we're placing the dollars sound because the while the dollar
and the FED play of problems, and that's a that's a rant upon itself.
There's not another central bank out there that sort of doing things the right
way, right, So, you know, America has been overloaded with debt,
which again has helped because of the way that the FED is able to
to monetize it and empower our physical authorities there. Um, you know,
inflation is a global problem, not simply because of you know, the war
in Ukraine or supply chain issues, but because of monetary excess over ten plus
years, really going back to the response to the financial crisis, so a
lot of the problems that the dollar has, the FED has these same problems
that exist with the yuan. They definitely exist with the yen in Japan,
they exist with you know, when I think of physical responsibility, I don't
think of Brazil and Argentina their own currency block there. This is it's political
in nature, sure, And the problem is that money and banking in the
US has become the tip of the spear of American foreign policy. So you
know, think back after nine to eleven, Right, the first thing we
did is we debanked al Qaeda allies and cut them off from you know,
American financial markets. And given the power of the dollar, it's a very
powerful tool. And who could argue with that, right, because these are
associates with terrorists, so obviously this is a good idea. And then we
debank North Korea, and then we deep bank Iran, and who could argue
with this because these are obviously bad countries and you know, why would anyone
oppose that? And then we debank Russia and you know, well, who
would oppose that, because yea, Russia is invading Ukraine, it's a sovereign
country, and therefore this is a lot better than sending bombs over there.
Right, So this is the problem is though, is that American foreign policy
is less about American interests and more about sort of promoting cultural norms. Right.
You know, at the start of every revolution starts with rainbow flags outside
of an embassy somewhere. And so when you have countries that are increasingly waking
up to the real realization that the post World War two order that you could
trust America to respect the rule of law to a certain extent, that you
could have them respect your national interests and sovereignty to a certain extent, that
they were going to be faithful allies, you know, to a certain extent.
Right, there was the rules based order that we're told we have to
defend. And Ukraine and Russia have been eroded because of America's own arrogance,
particularly the last twenty twenty five years. And so now you have nations that
say, well, instead of giving up our national sovereignty because we have to
follow what the DC tells us to do these things, then we need to
find alternatives because if they can do it to Russia, they can do it
to us. And so this is why you see African countries looking for alternatives.
It's not because they particularly trust the Chinese. It's because they just suddenly
don't want they don't want to be under the thumb of bureaucrats you know,
you know, and fetish gear in the Biden administration. Right and and so
the problem is is that we have weaponized the dollar, we have weaponized banking.
We've done it abroad, and we're doing it increasingly within. This is
the concerns about central bank digital currency, the de banking of conservative activists,
the way that the banks spied on people that were at the January sixth protest,
no matter what they did. The capital right, the weaponization of the
dollar of banking is forcing people that are aware of this and and concerned you
are not necessarily on the same page as your average buy An administration staff,
or they're naturally going to find alternatives there. Now what that'll turnive ends up
looking like? Again, the yuan has plenty of their own problems. China's
debt is crazier than ours. People make a big deal about them buying gold,
but their debt has increased far higher than their gold holdings. Um,
Russia, actually their central bank is like if you're yeah, yeah, their
central banker is perhaps the most sane out there. Which that's not a defense
of the Putin regime or by any means, she's not a necessarily big fans.
She tried to resign. Why is it the most sane or stable is
that they're spending has they kept their spending very low and their gold holdings went
up significantly, and they've done other things, you know, you know,
so that the response to sanctions was putting you know, the rub at a
peg, and so they've been thinking. Russia has been thinking about currency wars
in a very serious way for a very long time. Again, Russia has
plenty of other problems, the country that keeps killing themselves, corruption, all
that sort of stuff, and not a defense of the Russian regime as a
whole, but the Russian Central Bank has been very sane. Right, and
now you're starting to see the president of El Salvador, right, you know,
he's getting heavy a bitcoin. Can you have various African countries looking at
bitcoin and gold. You have India, you know, doing more with gold
um, you have other you know, other other interest in the Uan and
other currencies. I mean, this is this is political in nature, but
it's a results. It is a response to the hubris and the arrogance of
DC policymakers, and it's something that this is a whole different dynamic. And
this is this is beyond simply what a pure economic analysis will give you.
This is a political dynamic and it is something that Americans should be very concerned
about because if we can't export our debt elsewhere, the costs of our entitlement
programs that so many people rely upon are going to go up. You know,
it does serve the global currency status of the dollar, first and foremost
helps the America regime, but there are a lot of Americans that become depend
upon the programs that the government have promised them, and so there's going to
be you know, if we should that ever really get to that point of
crisis, there's going to be real costs at home. And that's why people
need to be thinking in the future about how do we best protect first and
foremost our families and our communities within this chaotic environment. And I hope a
little bit of economic literacy thinking about things in that way. That's what the
messis into tries to do can help prepare you to make individual decisions because there's
no policy maker, no election is going to fix this. This is beyond
politics. This is something that is as a major wave that no single politician
can fix. So I want to get into bitcoin pretty heavily because I know,
you know, you're much more literate in that than I am. But
what you just said about, you know, bringing economic literacy back to two
communities, what does that look like? Do you think it's possible to bring
a actual non because I'm pretty cynical at this point. I think a lot
of this is just controlled destruction. I think a lot of people just want
to keep people in the dark. Um. So do you think it's possible
to bring some form of um realism to economic programs, like in public schools,
back to education? What does that look like? I was very cynical.
I still am to it to a healthy degree. Um, But I
am encouraged by saying the moves that Governor of Santis has made in Florida,
which which I'm from, and seeing a for the first you know, in
a very rare example on the right, being kind of proactive on these things.
And so, you know, ways of adjusting how history is taught.
Now, getting rid of critical race theory is a good first step, it's
not enough. I was going through and reviewing that the textbooks in my county,
and of course you've read into the chapter of the Great Depression, and
still the standard narrative like, oh well Herbert Hoover was this, you know,
las fair, you know, uber uber conservative, and like that's why
we had the Great Depression. And so there's all these sort of baked in
narratives that are part of the mainstream that need to be addressed as well.
Notorious nationalists. Yeah, yeah, and and so you know there's still those
economic he's baked within the historical narrative. But just recognizing that school curriculums within
red states can be used the same way the left task to promote certain values.
There is no neutrality that there's going to another libertarian polacy. There's no
neutrality in any of this. And so I think that Florida has taken some
steps, I think on the economic side to be a little bit better.
Um, the way that you know, the way that it's taught is still
you know, I would love to be able to do trainings for teachers out
there, and I also encourage, like, if you're a young conservative trying
to figure out how to make a difference, I mean, being a teacher.
One of the ways the left wins is because they fill the ranks of
teachers because they take that as an ideological you know, priority in their own
right. So it'd be great to have more young conservatives, you know,
in their local high schools teaching this sort of stuff. But it is interesting
seeing how bitcoin and in bitcoin being different than crypto as a whole, because
most of the crypto is a scam. That has been a way that a
lot of people have discovered Austrian economics and the work of the Mesa's Institute because
they've become interested in that. Part of this this this growing lack of faith
in institutions, which are not just political institutions but financial institutions. I mean,
bitcoin itself came about during the financial crisis in O eight, o nine,
not simply as a response to the FED, but to banks, right
and and so you know, people realizing in the kind of real world now
it helps if you think, you know, money go up and you're right
in the moon and you're gonna make money off of that's that's great. You
know, I'm not saying that you should put in your entire life savings and
the business not financial advice, right and not in financial advice at all,
But but that has led to people sort of rethink about what really is money
in society? Why does it need to be controlled by the state. And
I think ultimately this populous tension, whether it's concerns about you know, DC,
whether it's concerns about Davos in the World Economic Forum and the Great Reset,
whether it's concerns within Europe over the ECB. Um. You know,
all of these countries have this tension between institutions and particularly can young people around
the world. I mean, you talk to young people in the UK and
they've got no hope at all because they know they're gonna get screwed. They
know they're going to use their labor to bail out pensioners. Right now,
this is the way that's all going to go. Recognizing deep politicized money as
a way of evading you know, I think one of the best tools the
RITE has and you know this, this I think is something we always have
to keep in mind. We talk about tech policy and things like that.
Is the ability to evade the surveillance state, whether it comes into encryption,
whether it comes in a bitcoin, whether it comes in a three D printing,
I think has a role in that as well. Um, Bitcoin I
think has created a tool in a very practical way that those that might not
be interested in reading an eight hundred book page book on economic theory, which
is you know perfectly fine, um, really engaging these issues in a meaningful
way going forward. And I think that that is something that's a very positive
thing. Um. You know, in the crypto industry as a whole has
all sorts of problems, tons of scams, and you know, Washington right
now has made it perfectly clear that Biden administration is doing everything they can and
to attack crypto and bitcoin because they recognize it as a threat to the control.
But people waking up to that I think is a very good thing.
Right. So take a Salvadore for instance, what are the odds that you
know, because it kind of seems like using bitcoin, as you know,
the backing of a national currency, it really kind of seems it's only a
matter of time until that suffers the same fate as the US dollar. Granted
it's hard coded, so it's only a limited supply, but it really kind
of only seems a matter of time until it goes the same way as the
gold standard, where it just gets you know, diminished and diminished until we're
no longer on it or other things get added to the pot. So I
think the gold standard is a very interesting and useful example here because ultimately the
failure of the gold standard came from that issue of trust within institutions. Right,
because gold as heavy, particularly large quantities, so it becomes very centralized
by nature. Right. You know, you have Fort Knox or you know,
you you have these major central banks and end up being you know,
all to mentally the large holder of gold. Um. You know, banks
will deposit that there for security risks. UM. This is why paper notes
became so popular because it's a lot easy to carry around, you know,
one hundred dollar bills than it is to carry the same amount of gold,
particularly back in the day. Um. And so that centralizing aspect of gold
from just a practical logistical standpoint, um is what it helped the state come
in and confiscate gold um devalue bank notes at par you know, from their
their original specie um value, all this sort of stuff. Bitcoin is interesting,
and you know there's some people that will absoluely swear by it, and
you know, I don't want to get in that count, because anything can
fail, and I think it's always important to have that sensibility with it.
Bitcoin, though, does I think solve some of these issues, only to
the extent that holding a Bitcoin account um, you know, particularly to do
it right, you know, you take it off offline. You know,
you have a hard hard wallet, um. You you you are a sponsible
custodian. And again this very much is a sort of self empowerment. There's
responsibility if you really, if you really want to isolate yourself from the political
pressures that come with it. Bitcoin has um attributes that gold doesn't have because
of that digital nature that solve some of those problems. Now it has other
problems. You know, there's concerns about quantum computing and you know, but
maybe the technology changes and I can't speak to that. That's that's that's a
whole There's there's other people that can. But there's natures within bitcoin that were
intended to solve the historical problem with gold. And I think what's interesting is
that you'll take a country like China. China became very hostile to bitcoin.
They made these you know, they confiscated all these mining rigs, they bulldozed
them, all sort of stuff. Um, it is interesting just from a
geopolitical perspective, if they really want to challenge the dollars, China actually has
a lot more bitcoin than America does. They don't have more gold than the
dollars than than the US does. So if they were thinking about a non
politicize sort of monetary weapon, Bitcoin in many ways had more advantages to China
than other alternatives did. I think their top concern there was people opting out
of the Chinese banking system, which they can afford, right, So their
concerned was more domestic control than it was geopolitics. Though Hong Kong is now
open for business with crypto crypto again, so I think that's a that's a
very interesting pivot from China in that regard. But even in this very you
know, given all the state capacity that China has for surveillance and punishing citizens
and that whole dynamic, you still had direct transactions going on within bitcoin.
Now you didn't have They shut down the exchanges, which you know, like
the banks, right, those those weakness points that the state has always used,
right, And they use the banking system to control your money. They
use all these intermediaries to control your money in a way that they can't deal
with cash. Right, That's still why you know, that's why drug deals
are done with cash. Right, you can you can opt out of the
surveillance state and use cash as as a means of processing. They are the
same way you can m or you know, you want to avoid taxes.
Right, There's plenty of of honest ways that you can cash the same things
with truth bitcoin. All the state capascity that China had, they couldn't control
um. And so I think that's why, you know, that's that's that's
why I think bitcoin is still something I'm very interested in as a response to
this heavy handed nature of you know, the managerial state within the West.
UM. And it's why I think you're gonna see continual escalation. But all
the escalation in the world I don't think is going to instrumentally undermine um the
value that bitcoin has. Now you know, the IMF is throw El El
Salvador over this. The Senate has has done some bills and response saying,
oh, we gotta watch off of this El Salvador guy. You know,
like this, this is dangerous, right. Um. You know Paul Kruman
will suggest that the only reason you'd buy bitcoin is to engage in nefarious things
and are therefore we must crack down on it. The same propaganda campaign that's
always used for in anything outside the state control. That's going to be in
full front. That's going to escalate. Um. But I think fundamentally the
tools the attributes of bitcoin still have value in this crazy world. Um.
And then hell, something fundamentally changes, which again it could, I'm not
saying it can't, but it tells like fundamentally changes about that that I am
confident about the you know, the firm math behind bitcoin and it's firm limit
of twenty one million you know bitcoins and things like that. I think all
of these are trustless dynamics, which ultimately is the main core of the hardcore
you know bitcoin crowd. Very fascinating. No, I'm prone to agree.
I'm not, as I said, nearly as literate on bitcoin as you or
other economists will be. Um, I think, you know, blockchain technology
is something that we're going to see integrated a lot more in our daily lives,
and I even heard people talk about using it in things like voting,
which I really hope it doesn't happen. I'm still very much partial to you
know, paper ballots, but that's just because I'm a boomer. But let's
circle back a little bit and talk about China's debt. You mentioned, you
know, they're far more overextended than the US's and how it's money's been being
used as a political tool. Essentially, it seems very much so that we
could just take them out in a matter of months. So if we got
serious, buckled down and you know, issued the right amount of sanctions,
coordinated with our allies and everyone got on the same page. This is a
threat to you know, the global order that everyone would be worse off because
of why do you think that's not happening? And do you think it ought
to happen? Well, I think one of the reasons it's not it is
because we have so much of our manufacturing that's been outsourced out there. Um,
you know the greed of Wall Street has, you know the things people
make a big deal about, Um, oh well you know they're they're going
to China because of labor costs and things like that, and it's just not
true. The reason why you have so many big businesses that have relocated to
China because if you want to if you want cheap labor, right you when
you go to China right now because of the way that their wages have increased,
you go to Bangladesh or you go to Vietnam, and you know that
those those sort of areas, right, They're not going there because of cheap
labor costs. They're going there because they want access to the Chinese invest in
market place. You know, they want you know, if you can sell
one square fabric to every you know, citizen in China, then you're gonna
be a very wealthy man. Right. So it's a greed of Wall Street.
And you know, I think in recent years you've seen a greater recognition
of some of the different you know, the cultural concerns you know, China
as you know, I think it's a genuine rogue actor in a way that
um, you know, of of of a certain size that we haven't really
seen, you know, from a geopolitical standpoint, you know, since the
Soviet Union, um, which makes it very different than say, you know,
Iraq, right, you know, you're not gonna be concerned about Iraq
really, you know, changing the global stage unless you're you know, two
thousands zeron neocon Um. And and what's interesting, those American form policy was
subsidizing this, you know, right, So like you had Starbanes Oxley,
and you had the Dodd Frank Act, and you had all these American regulations
that put very strict reporting requirements and requirements on companies, and yeah, didn't
apply to you know, Chinese companies. And so there's there's these explicit sort
of and you know, so that the Obama administration had a memo of understanding
with the Chinese financial industry saying, oh, well, all the auditing requirements
that we require from our companies, don't worry, China is going to enforce
those over there. In surprise, surprise, you know, they're they were
ripping off American investors blind. And so there was a lot of I think
naivete with China because the underlying assumption right within Washington, within New York,
within the West as a whole, was the more liberalized the Chinese economy became,
the more western it would become within its values. And I think you
could argue that to a certain extent that was true up to a point.
The difference is that she is not interested in liberalization, right. He is,
you know, he is very much a product of of of Mao.
His cultural views are very different, and so you've seen a much more strict,
you know, a much more heavy handed approach by the CCP to various
you know, Jack Maub disappeared for a while because you know, he was
speaking out against some of the concerns over there. There's a secondary dynamic though
as well, Like when you do business with China, you're doing business for
the most part with the CCP um. You know, the largest businesses there
are state backed enterprises, and so you know, there there is that aspect,
you know where you know, we have American companies, you know subsidizing
you know, the parts of China with you know, weaker prison camps,
right and you know, we're all fine with it because it makes the stock
numbers go up. But like that's that's something that we should probably have a
conversation about. Like like Disney explicitly thank them in the in the credits for
or not consciation camps, but the regional government in the laund remake. So
and it was the pleasurity. Yeah, and the things those now now now,
these same aspects lead to problems within China. Right, So if you
think about the degree to which state backed enterprises makeup the size of Chinese economy,
Um, if your state back enterprise, your top priority isn't profit and
loss, it's keeping on good terms with the regime. Right. And so
you know in in uh a couple of years ago, um, it was
like the majority of the Chinese loan market was going to stake back enterprises,
which again quality of loans there, you know, politicized by nature. If
if you're the same amount you think about Fantam and Freddie Mac which is a
politicized form of capital allocation within the housing market. You know that crash was
a big part of you know, our problems in oh eight. If you
have that same sort of crash happened in China, like if you actually had
to mark the value of you know, all this copper that they've extracted from
ground and keeping warehouses just because the jobs there were good, or you know,
all these different politicized agenda items and the profit and loss of all these
businesses are very problematic and in fact going at late twenty nineteen, the Chinese
banking system was melting down because of this, and then COVID happened, and
then that created all social distractions, which is yeah, kind of interesting.
Um. And so so all of these go to like some of the economic
underpinnings there. The question of what America should do about it is that,
you know, first and foremost is that you know, we need to get
our own house in order. Right. You know, again, why are
people why are foreign foreign powers are our historic allies wanting to do business with
China? Well, it's because of American politics. Um. You know why
is American manufacturing been eroded? Well, a big part of that is because
Monterrey policy, right, we have we have undermine we we have, we
have government policies have disenfranchised American business to the to the benefit of the international
markets. And so you know, if we if we were able to restore
some level of sanity internally, um, that would be the biggest threat to
China. But instead, you know, we still have all sorts of requirements
that lead to you know, our saline bags, you know, for our
ivs you know, being largely manufactured in China. Right, we have all
these problems that are policy decisions. They aren't. They are the result of
markets, you know, free markets working, there's a result of policy decisions.
And so until we get our economic house in order, we're going to
continue to be feeding um the the the interest of China. I mean,
I had a conversation a couple weeks ago with something from Japan who was obviously
very concerned about Chinese aggression. They are a big defender, champions of defending
Ukraine because of the domino effect there. And so the argument I made is
that no one, no country is better off now than they were, you
know, at the start of the Russian Ukraine War. Then China, because
American policymakers are doing everything we can to make them look more attractive. And
so again if America got if we had sanity in the US, that would
be the biggest threat to China. But unfortunately, sanity requires a massive ideological
shift amongst the elite, amongst policymakers, a buck severer parduct class of bucks,
the politicians, amongst academia. And so that getting that ideological shift so
that policy can reflect sanity, that's our biggest battle. And that's why going
after higher ed and again, the ideas being perpetrated out there. I think
it is one of the biggest political issues out there because without an ideological change,
we're not going to solve our montery issues, We're not going to solve
our regulatory state, We're not going to solve these these underlying problems. I
hope you enjoyed that episode of Federalist Radio Hour with though Bishop and as always
belovers of freedom and anxious for the fray