1 00:00:00,200 --> 00:00:04,839 Speaker 1: What entity in society doesn't borrow more once it's taking 2 00:00:04,919 --> 00:00:07,719 in more revenue, And so they're thinking that the debt 3 00:00:07,839 --> 00:00:10,759 is the problem as opposed to just the extraction in 4 00:00:10,800 --> 00:00:13,279 the first list, and say we can fix the problem 5 00:00:13,279 --> 00:00:16,800 by raising more revenue, getting more revenue to the US Treasury. 6 00:00:17,160 --> 00:00:20,000 It's just unbelievable. So yeah, in a since the delusions 7 00:00:20,000 --> 00:00:22,120 are endless, I call it the deficit delusion. 8 00:00:22,320 --> 00:00:25,760 Speaker 2: You are listening to Carrie Let's his Financial Survival Network 9 00:00:25,920 --> 00:00:29,280 where you get valuable information you just can't find anywhere 10 00:00:29,280 --> 00:00:33,119 else to thrive in today's trying times. You need the 11 00:00:33,119 --> 00:00:37,840 Financial Survival Network now more than ever. Go to Financial 12 00:00:37,880 --> 00:00:41,520 Survivalnetwork dot com and get your free newsletter and gift. 13 00:00:42,079 --> 00:00:46,240 Financial Survival Network now more than ever. 14 00:00:49,719 --> 00:00:50,439 Speaker 3: And welcome. 15 00:00:50,679 --> 00:00:54,119 Speaker 4: You are listening to and watching the Financial Survival Network. 16 00:00:54,159 --> 00:00:57,320 I'm your host Carrie Let's. John Tamney is with us now. 17 00:00:57,759 --> 00:01:02,920 He runs a real clear markets, author of a new 18 00:01:02,960 --> 00:01:07,560 book which we'll be talking about called Deficit Delusion, Delusions, 19 00:01:08,359 --> 00:01:13,200 Delusion Delusion. Okay, but there are multiple delusions out there, 20 00:01:13,239 --> 00:01:17,560 no doubt. There's no shortage of delusions in our modern 21 00:01:17,599 --> 00:01:21,439 world here, No, John, you know, John, you and I 22 00:01:21,519 --> 00:01:25,680 we spoke did a few interviews with you way back 23 00:01:26,640 --> 00:01:31,319 in twenty twelve, twenty eleven. The world's changed quite a 24 00:01:31,319 --> 00:01:36,439 bit since then. But let's talk about deficit delusion or 25 00:01:36,480 --> 00:01:40,640 delusions first. What is the biggest delusion about the deficit? 26 00:01:41,959 --> 00:01:46,400 Speaker 1: That the crisis is ahead? All left, right and supply 27 00:01:46,519 --> 00:01:50,040 side talk about is well yet really bad and we 28 00:01:50,200 --> 00:01:54,359 better they're eventually they're gonna not be so kind to 29 00:01:54,439 --> 00:01:57,319 us the rest of the world, and that's the crisis. 30 00:01:57,359 --> 00:02:01,640 And I'm thinking, have you guys lost your minds? The 31 00:02:01,640 --> 00:02:05,840 crisis is not a future thing. It's not a future 32 00:02:05,879 --> 00:02:08,439 when when lenders decide that they don't want to lend 33 00:02:08,520 --> 00:02:10,879 the United States anymore, now that's kind of a good thing. 34 00:02:10,919 --> 00:02:15,039 When people cut off government. The crisis is in here 35 00:02:15,120 --> 00:02:19,120 and now, I mean it's unseen, but it's in how 36 00:02:19,199 --> 00:02:22,719 much more advanced we'd be if government weren't consuming so 37 00:02:22,840 --> 00:02:24,919 much in the way of precious resources. 38 00:02:25,879 --> 00:02:26,360 Speaker 3: It's in. 39 00:02:28,039 --> 00:02:31,439 Speaker 1: What the grandchildren here, these the left, right and supplic side, 40 00:02:31,439 --> 00:02:33,800 they say, oh, well, yeah, they're going to inherit all 41 00:02:33,800 --> 00:02:36,680 this debt that's so awful and we're having a good 42 00:02:36,719 --> 00:02:40,639 time at the expense of them. Where's the good time 43 00:02:40,680 --> 00:02:45,319 in government spending, it's a bad time. It's the central 44 00:02:45,400 --> 00:02:48,439 planning of precious resources. So that's the crisis, but you 45 00:02:48,479 --> 00:02:49,960 can't see it because you don't see how much more 46 00:02:49,960 --> 00:02:53,520 advanced we be without it. The burden for the grandchildren 47 00:02:53,599 --> 00:02:55,639 is that we leave them a much less evolved world 48 00:02:56,360 --> 00:02:59,439 and even more challenging. We leave them a much bigger government. 49 00:03:00,080 --> 00:03:03,719 This focus on the debt is just so childish, and 50 00:03:03,759 --> 00:03:07,039 it works in saying that the crisis in the future. 51 00:03:07,120 --> 00:03:12,199 It's it's these different economic religions basically saying, yeah, markets 52 00:03:12,240 --> 00:03:15,120 are incredibly stupid. They can't see what we can all see. 53 00:03:15,599 --> 00:03:17,879 They can't see the crisis that's ahead. I mean, it's 54 00:03:17,879 --> 00:03:18,599 just mindless. 55 00:03:19,680 --> 00:03:23,439 Speaker 4: You know, I totally agree with you, because every dollar 56 00:03:23,800 --> 00:03:28,560 that the government spends, it's taken from from the people, 57 00:03:28,800 --> 00:03:32,240 from the businesses that could arguably be spent a lot 58 00:03:32,319 --> 00:03:33,240 more efficiently. 59 00:03:34,039 --> 00:03:36,039 Speaker 3: And you know that you're right. 60 00:03:36,120 --> 00:03:42,120 Speaker 4: The crisis has been ongoing arguably since FDR and when 61 00:03:42,120 --> 00:03:47,639 the when the country really ran off the rails, you know, 62 00:03:47,680 --> 00:03:53,280 when when personal responsibility took a backseat to government largesse. 63 00:03:54,080 --> 00:03:57,439 And as like we can point to the Hoover Dam, 64 00:03:57,680 --> 00:04:00,560 we can point to a lot of bridges and. 65 00:04:00,479 --> 00:04:01,599 Speaker 3: Tunnels that were built. 66 00:04:01,879 --> 00:04:04,879 Speaker 4: We could also point to a lot of post offices 67 00:04:04,919 --> 00:04:12,000 that were built that are basically houses for human non productivity. 68 00:04:12,199 --> 00:04:15,680 Speaker 1: It's also true I like how you fit at houses 69 00:04:15,719 --> 00:04:19,680 for human non productivity. I would throw into that. One 70 00:04:19,720 --> 00:04:21,759 of the things that somebody I'd like to raise money 71 00:04:21,800 --> 00:04:26,160 for is the Museum of the Unseen and literally take 72 00:04:26,199 --> 00:04:28,639 it around the country and I think you can get 73 00:04:28,639 --> 00:04:31,279 good publicity for it, and just people show up and 74 00:04:31,279 --> 00:04:35,360 there's nothing in there. And that's kind of the point. 75 00:04:36,199 --> 00:04:42,279 It's what we're not doing yet. No matter the economic religion, 76 00:04:42,399 --> 00:04:45,240 it's always a future problem. And so they focus on 77 00:04:45,480 --> 00:04:49,519 balanced budgets as though that matters. No, what matters is 78 00:04:49,560 --> 00:04:53,160 how much they extract to balance the budget. In the 79 00:04:53,240 --> 00:04:57,680 United States, it's the accomplishment equivalent of slam dunking on 80 00:04:57,759 --> 00:05:00,399 a six foot basket if you're seven feet tall. I mean, 81 00:05:00,839 --> 00:05:05,399 you're extracting from the most productive people on Earth. Balance 82 00:05:05,480 --> 00:05:08,680 budget misses the point. It's about how much they extract 83 00:05:08,680 --> 00:05:11,000 every year, and they extract too much from us. That's 84 00:05:11,040 --> 00:05:13,920 why we have so much debt. I've never heard of 85 00:05:13,920 --> 00:05:17,120 an entity that can borrow so much unless it's taking 86 00:05:17,160 --> 00:05:19,319 so much in the first place. That's the people trust 87 00:05:19,319 --> 00:05:22,240 the debt. Yet left, right and supply side keep talking 88 00:05:22,279 --> 00:05:25,959 about how, no, we need to fix the debt problem, 89 00:05:26,000 --> 00:05:28,439 we need to raise more revenue. I mean, have they 90 00:05:28,480 --> 00:05:33,199 lost their minds? What entity in society doesn't borrow more 91 00:05:33,720 --> 00:05:36,240 once it's taking in more revenue. And so they're thinking 92 00:05:36,240 --> 00:05:39,639 that the debt is the problem as opposed to just 93 00:05:39,720 --> 00:05:42,480 the extraction in the first place. Say we can fix 94 00:05:42,519 --> 00:05:45,600 the problem by raising more revenue, getting more revenue to 95 00:05:45,639 --> 00:05:49,000 the US Treasury. It's just unbelievable. So yeah, in a sense, 96 00:05:49,079 --> 00:05:51,879 the delusions are endless. I call it the deficit delusion. 97 00:05:52,120 --> 00:05:55,759 Speaker 4: Yeah, so true, because it's a symptom of out of 98 00:05:55,800 --> 00:05:59,720 control government. So I just wrote an article because I 99 00:05:59,759 --> 00:06:02,160 know this case is coming. I don't know how it's 100 00:06:02,199 --> 00:06:05,000 going to come to the Supreme Court. And that is 101 00:06:05,439 --> 00:06:11,120 the impoundment, the ICA impoundment, the Control Act of nineteen 102 00:06:11,199 --> 00:06:14,839 seventy four, which basically, and I gave this example, if 103 00:06:14,879 --> 00:06:21,319 Congress decides that they want to create a monument to 104 00:06:22,040 --> 00:06:28,600 basically the tomb of the faceless bureaucrat and in honor 105 00:06:28,639 --> 00:06:31,800 of them screwing up our lives, messing up, you know, 106 00:06:32,079 --> 00:06:35,040 failing to grant permits all this, and then they're going 107 00:06:35,079 --> 00:06:38,759 to have a bonfire that runs twenty four to seven 108 00:06:39,399 --> 00:06:41,879 and they're going to feed it with freshly minted one 109 00:06:41,920 --> 00:06:46,199 hundred dollars bills from the Federal Reserve, and they mandate 110 00:06:46,319 --> 00:06:49,600 that this bonfire must be kept going twenty four to 111 00:06:49,600 --> 00:06:54,959 seven in perpetuity. Under the Impoundment Control Act of nineteen 112 00:06:55,040 --> 00:06:58,879 seventy four, the President's required to light the match. I mean, 113 00:06:59,040 --> 00:07:03,439 it's absurd, but that case is coming. And that case, 114 00:07:04,000 --> 00:07:07,720 if we have somebody who actually wants to cut government 115 00:07:07,800 --> 00:07:10,560 spending and cut the scale of it back, it's going 116 00:07:10,600 --> 00:07:13,560 to go in favor of the president. We'll see what 117 00:07:13,600 --> 00:07:15,199 he does with that newfound power. 118 00:07:15,879 --> 00:07:18,319 Speaker 1: Well, the only thing I would say, though, in response 119 00:07:18,399 --> 00:07:21,879 to you, is that so what I mean. I'm not 120 00:07:21,560 --> 00:07:25,439 I'm not making a comment on whether it's constitutional or not. 121 00:07:26,079 --> 00:07:30,160 I'm just saying cut spending. That that's like, that's not 122 00:07:30,319 --> 00:07:33,920 going to shrink government, and it's not going to shrink government. 123 00:07:33,959 --> 00:07:37,680 It's like, if you spend less, there's not less consumption 124 00:07:37,800 --> 00:07:40,720 in society. You're just what you don't spend is shifted 125 00:07:40,720 --> 00:07:45,680 to someone else through whatever financial intermediaries you use. When 126 00:07:45,759 --> 00:07:49,800 governments don't spend or when they shrink a program, the 127 00:07:49,879 --> 00:07:53,199 money doesn't disappear, it just goes to something else. And 128 00:07:53,279 --> 00:07:55,920 so I make the argument in the book, I don't 129 00:07:56,319 --> 00:07:59,920 I reject your point that we have out of control government. No, 130 00:08:00,120 --> 00:08:01,959 what we have is a government that takes in too 131 00:08:02,040 --> 00:08:05,079 much revenue. And because it takes in too much revenue, 132 00:08:05,160 --> 00:08:07,959 it can borrow with these and it can borrow an 133 00:08:08,079 --> 00:08:10,560 enormous amounts because markets are a look into the future. 134 00:08:10,560 --> 00:08:13,519 As we both agree, the markets know that the revenue 135 00:08:13,519 --> 00:08:15,560 is going to grow, grow and grow. And so the 136 00:08:15,600 --> 00:08:20,360 problem is over taxation of Americans, that people would spend 137 00:08:20,560 --> 00:08:23,000 the gobs of money that flow to them as a 138 00:08:23,040 --> 00:08:26,199 statement the obviously, but if you cut spending, which oh, 139 00:08:26,240 --> 00:08:29,199 if we just cut, if those can just get too 140 00:08:29,279 --> 00:08:32,200 trillion out of it, that would just free up two 141 00:08:32,279 --> 00:08:35,240 trillion for them to dream up new really awful ideas 142 00:08:35,240 --> 00:08:37,720 with the problem is too much revenue. 143 00:08:37,960 --> 00:08:42,320 Speaker 4: And the problem is that the system Congress totally in 144 00:08:42,440 --> 00:08:47,799 charge of spending money and the president has no say 145 00:08:47,840 --> 00:08:51,960 over it whatsoever under that ICA Act. I'm not saying 146 00:08:52,120 --> 00:08:56,120 if he did, and if he wanted to change it, 147 00:08:56,919 --> 00:09:00,360 then he could. But if he doesn't have control he 148 00:09:00,440 --> 00:09:03,440 does want to change it, he has no power. If 149 00:09:03,440 --> 00:09:05,960 he has control and he doesn't want to change anything, 150 00:09:06,000 --> 00:09:09,759 then nothing is going to change. But the look, they've 151 00:09:09,799 --> 00:09:15,480 already violated that Act numerous times, like hundreds of times 152 00:09:15,559 --> 00:09:18,480 with Doge. And I'm not saying it's the cure all 153 00:09:18,600 --> 00:09:24,120 for the court to rule it unconstitutional. But if we 154 00:09:24,559 --> 00:09:26,960 do get a president who wants to cut spending, and 155 00:09:27,000 --> 00:09:29,919 I'm not convinced that the current occupant is the one 156 00:09:29,960 --> 00:09:33,240 to do that, then at least he might have the 157 00:09:33,279 --> 00:09:37,080 tools to do it. Don't forget the last impeachment of 158 00:09:37,200 --> 00:09:42,320 Trump was brought under the Impoundment Control Act. When they 159 00:09:42,320 --> 00:09:45,720 said he didn't send the money to Ukraine. That was 160 00:09:46,000 --> 00:09:49,600 part of the basis for that. He didn't spend the 161 00:09:49,639 --> 00:09:51,720 money that they told him to spend, and that was 162 00:09:51,759 --> 00:09:54,320 somehow a high crime and a misdemeanor. 163 00:09:54,840 --> 00:09:58,600 Speaker 1: Now, look, I like it until I'm reminded of Let's 164 00:09:58,639 --> 00:10:01,639 say we cut spending, we haven't cut the flow of 165 00:10:01,720 --> 00:10:04,080 revenue into the government. See, even if you could shrink 166 00:10:04,159 --> 00:10:06,480 spending for a year or two, it wouldn't change anything. 167 00:10:07,399 --> 00:10:10,360 The problem is too much revenue now and wait, too much. 168 00:10:10,600 --> 00:10:11,279 Speaker 3: Part of it. 169 00:10:11,279 --> 00:10:15,039 Speaker 4: It's all interconnected, and it's all being stolen here, John, 170 00:10:15,120 --> 00:10:18,679 let's face it. They call it fraud, abuse, waste. I 171 00:10:18,759 --> 00:10:22,960 call it theft, all right, theft that comes in the 172 00:10:23,000 --> 00:10:26,639 form of a ten forty tax return. 173 00:10:27,080 --> 00:10:30,320 Speaker 1: Yeah, it's a tough one because the government is us. 174 00:10:30,440 --> 00:10:33,480 We allowed this to happen, and so it's hard for 175 00:10:33,519 --> 00:10:35,840 me to say it's theft. We keep voting for it. 176 00:10:35,919 --> 00:10:39,879 But I look, I think we have similar goals here. 177 00:10:39,919 --> 00:10:45,720 I think we something similar that the crisis is in 178 00:10:45,799 --> 00:10:49,080 what were the advances that are not happening? And it's 179 00:10:49,159 --> 00:10:51,759 not even a question of arguably less efficient. Of course, 180 00:10:51,759 --> 00:10:56,799 government spending is less efficient, and because it's such a 181 00:10:56,840 --> 00:11:00,480 size consumer of precious wealth, we always have to wonder 182 00:11:00,720 --> 00:11:03,440 what we're not achieving as a consequence. 183 00:11:04,440 --> 00:11:08,039 Speaker 4: And that is the real crime here. Because you and 184 00:11:08,080 --> 00:11:12,320 I agree on this one hundred percent. If government had 185 00:11:12,360 --> 00:11:18,000 stayed at the level it was at before Roosevelt, right, 186 00:11:18,679 --> 00:11:22,279 even if it had gone up slightly from there, the 187 00:11:22,320 --> 00:11:27,320 amount of wealth that this country would possess would just 188 00:11:27,399 --> 00:11:31,960 be astounding. It would far exceed any other, even the 189 00:11:32,039 --> 00:11:37,799 United States pre World War One, because those every dollar 190 00:11:37,879 --> 00:11:42,399 that the government spends is a lost opportunity for the 191 00:11:42,399 --> 00:11:43,480 person that's paying it. 192 00:11:43,559 --> 00:11:47,519 Speaker 1: Right, absolutely absolutely, and you're so right, And I just 193 00:11:47,559 --> 00:11:49,879 I think it's important the way that you describe it. Again, 194 00:11:50,240 --> 00:11:52,960 think of how left, right and supply side do it. 195 00:11:52,960 --> 00:11:56,639 It's always we better do this because the crisis may happen. 196 00:12:00,559 --> 00:12:02,720 They've never sold anything in their lives. I mean, I 197 00:12:02,759 --> 00:12:06,440 can't think of a more loser approach, unpersuasive approach, because 198 00:12:06,440 --> 00:12:08,720 people can say, well, yeah, you've been saying that forever 199 00:12:09,279 --> 00:12:12,360 and it's never comes true. But it should be an 200 00:12:12,360 --> 00:12:15,039 optimistic sale in that Gosh, think of what we could 201 00:12:15,039 --> 00:12:17,759 be doing. Think of as prosperous as we are, and 202 00:12:17,759 --> 00:12:20,960 we're the richest country on earth, were amazing, Think how 203 00:12:21,039 --> 00:12:24,440 much more prosperous, more advanced we would be the present, 204 00:12:25,600 --> 00:12:28,320 if we were at levels from the nineteen thirties would be. 205 00:12:29,320 --> 00:12:32,679 It would make the present look Bangladesh by comparison. We're 206 00:12:32,720 --> 00:12:34,159 nowhere close to what we could achieve. 207 00:12:35,080 --> 00:12:39,440 Speaker 4: Yeah, that is the crime, and unfortunately it's a silent crime. 208 00:12:40,200 --> 00:12:43,639 Speaker 3: Yeah, it's unseen, we don't know, no one knows. 209 00:12:43,440 --> 00:12:47,039 Speaker 4: It what we could have been had the government not 210 00:12:47,639 --> 00:12:53,759 metastasized into its current form. So Let's talk about something though, 211 00:12:53,759 --> 00:12:57,840 because we were talking about a pre call. Your attitude 212 00:12:58,039 --> 00:13:02,240 towards your own life. Really, whether you're optimistic towards your 213 00:13:02,240 --> 00:13:05,960 own life or pessimistic, is going to carry over to 214 00:13:06,039 --> 00:13:09,879 your attitude towards what you expect the government to be. 215 00:13:10,279 --> 00:13:14,200 And I remember there was a guy, Howard Schultz, I 216 00:13:14,200 --> 00:13:17,200 think his name was. He wrote a newsletter called the 217 00:13:17,200 --> 00:13:22,720 One Armed Economist after something FDR once said, and he 218 00:13:22,799 --> 00:13:26,679 basically said, when we have a depression, it's really massive 219 00:13:27,200 --> 00:13:31,039 mental depression on the part of the population. The majority 220 00:13:31,480 --> 00:13:35,799 just get very pessimistic, and then the economy follows suit. 221 00:13:36,320 --> 00:13:39,480 So is this a chicken and egg situation here, John, 222 00:13:39,720 --> 00:13:41,399 or is there something to this? 223 00:13:42,360 --> 00:13:42,799 Speaker 3: Okay? 224 00:13:43,080 --> 00:13:46,039 Speaker 1: So I don't think I would have to convince you 225 00:13:46,159 --> 00:13:52,799 that what drives economic growth isn't consumption. It's savings, as 226 00:13:52,840 --> 00:13:57,360 in entrepreneurs mows with savings. Yeah, nothing new to you there. 227 00:13:57,720 --> 00:14:00,440 And so there's always been this belief out there that, well, 228 00:14:00,480 --> 00:14:04,600 you know, the media can talk us into a recession. 229 00:14:04,759 --> 00:14:07,639 They'll tell us that things are going to get bad, 230 00:14:07,679 --> 00:14:10,879 and economists say, well, yeah, then people will stop spending 231 00:14:10,960 --> 00:14:13,240 and oh boy, the economy is going to be desperate. 232 00:14:13,639 --> 00:14:16,320 But as you and I know, it's the lack of 233 00:14:16,600 --> 00:14:21,080 spending that feeds new ideas. That's not to say that 234 00:14:21,120 --> 00:14:24,279 people won't consume. We're wired to consume. 235 00:14:24,000 --> 00:14:24,759 Speaker 3: That's the easy part. 236 00:14:24,799 --> 00:14:27,279 Speaker 1: But if we're spending less, that just frees up capital 237 00:14:27,399 --> 00:14:31,840 more for businesses and new ideas. And so I've always 238 00:14:31,879 --> 00:14:35,159 felt that recessions are self correcting in that way for 239 00:14:35,279 --> 00:14:38,679 reasons beyond if people are really worried a they're fixing 240 00:14:38,720 --> 00:14:42,360 what they're doing wrong. Recessions signal the recovery, but they 241 00:14:42,360 --> 00:14:45,120 also signal the recovery in that Okay, I'm going to 242 00:14:45,159 --> 00:14:47,639 pull back for a time, I'm nervous about what's ahead. 243 00:14:47,799 --> 00:14:49,879 I'm going to pull back, and that kind of fruit 244 00:14:49,879 --> 00:14:53,559 that builds up the capital base for recovery. And so 245 00:14:53,679 --> 00:14:57,120 I don't think mental can drive depressions. But I think 246 00:14:57,159 --> 00:14:59,480 what you and I were talking about, and correct me 247 00:14:59,480 --> 00:15:02,919 if i'm you, and I think that people's perception of 248 00:15:02,960 --> 00:15:06,200 the world around them is driven a perception of the 249 00:15:06,200 --> 00:15:08,679 future is driven by their own situation. And I think 250 00:15:08,720 --> 00:15:11,559 you're absolutely right. I think someone who has a great day, 251 00:15:11,919 --> 00:15:14,799 if you ask them where things are headed, they would 252 00:15:14,840 --> 00:15:17,080 have a fully different view than if they'd had a 253 00:15:17,080 --> 00:15:21,519 horrible day, We're a horrible year month, or you. 254 00:15:21,639 --> 00:15:25,480 Speaker 4: Just maybe think of that song Everything's Coming Up Roses, 255 00:15:25,600 --> 00:15:30,879 you know, Gypsy we Rustle, you know, one of those 256 00:15:31,200 --> 00:15:35,720 Rogers and Hammerstein plays. You know, when you're feeling good, 257 00:15:36,240 --> 00:15:39,879 the world looks good. When you're feeling bad, you're imagining 258 00:15:39,919 --> 00:15:45,720 the worst around every corner. So because your own economy 259 00:15:45,799 --> 00:15:49,639 starts in your brain and you have to control your 260 00:15:49,679 --> 00:15:53,200 state and not get sucked in because you know there 261 00:15:53,240 --> 00:15:56,240 is a lot of negativity out there. They're problems, for sure, 262 00:15:56,639 --> 00:15:59,679 But john look like the way we live, not just 263 00:15:59,720 --> 00:16:02,320 in the United States, but in Europe and in the 264 00:16:02,360 --> 00:16:06,240 more developed parts of the world, there's never been anything 265 00:16:06,360 --> 00:16:10,799 like this before, where literally, in many ways you live 266 00:16:11,320 --> 00:16:13,200 better than the kings of yesteryear. 267 00:16:13,759 --> 00:16:18,960 Speaker 1: No doubt, living standards are amazing. They're an effect of 268 00:16:19,120 --> 00:16:24,279 innovative people mass producing goods that past generations never imagined 269 00:16:24,320 --> 00:16:27,080 they could have. And you know, I think you hit 270 00:16:27,120 --> 00:16:29,519 on something else that's really important. What's that line from 271 00:16:29,519 --> 00:16:33,559 Hazlit's book Economics and One Lesson. He said, quote, what 272 00:16:33,639 --> 00:16:36,360 is harmful or disastrous to an individual must be equally 273 00:16:36,399 --> 00:16:39,159 a harmful or disastrous the collection of individuals that make 274 00:16:39,200 --> 00:16:41,320 up a nation. In all he was saying, but I 275 00:16:41,320 --> 00:16:42,879 thought it was the most important line in the book 276 00:16:42,879 --> 00:16:45,240 that no one talks about. They're never talked about. He's 277 00:16:45,240 --> 00:16:49,080 just saying, economies are individuals, as you allude and as 278 00:16:49,120 --> 00:16:52,399 you state and so. But this is important when we 279 00:16:52,480 --> 00:16:58,159 consider policy. I don't care what your ideology is. You 280 00:16:58,200 --> 00:17:01,799 can no individuals. Economy is improved if they're heading more 281 00:17:01,799 --> 00:17:05,240 and more of the wealth over to the government, if 282 00:17:05,240 --> 00:17:09,359 they're spending more time dealing with regulators rather than producing 283 00:17:09,400 --> 00:17:12,720 what erard is they're producing, if they're not allowed to 284 00:17:12,880 --> 00:17:15,000 trade with other people who want to trade with them 285 00:17:15,319 --> 00:17:19,319 in other parts of the world, economic growth and optimism 286 00:17:19,359 --> 00:17:22,480 is fairly basic once you break it down to these 287 00:17:22,519 --> 00:17:24,480 first principles that you've broken down to that it's just 288 00:17:24,680 --> 00:17:29,839 it's individuals, and individuals are much more collectively depressed when 289 00:17:29,920 --> 00:17:34,160 policy is suffocating their ability to do to help themselves 290 00:17:34,200 --> 00:17:35,319 as individuals. 291 00:17:35,599 --> 00:17:38,839 Speaker 4: Yeah, but you know the problem, it's kind of like education. 292 00:17:39,640 --> 00:17:42,079 You know, going back I grew up in the sixties, 293 00:17:42,480 --> 00:17:46,680 more than half the population smoked cigarettes, which is an 294 00:17:46,720 --> 00:17:52,039 absolute act of insanity, self destructive. It's maybe not going 295 00:17:52,079 --> 00:17:54,640 to get you now, but maybe maybe in ten years, 296 00:17:54,640 --> 00:17:55,359 maybe in twenty. 297 00:17:55,440 --> 00:17:57,720 Speaker 3: Eventually it's going to get you. Now. 298 00:17:58,480 --> 00:18:00,279 Speaker 4: I never thought i'd live to see the day where 299 00:18:00,359 --> 00:18:05,480 less than twenty percent of the population smokes tobacco cigarettes, 300 00:18:05,920 --> 00:18:10,599 and that number keeps falling. And you know, the left 301 00:18:10,680 --> 00:18:15,119 is always saying education, education, But this is a case 302 00:18:15,160 --> 00:18:19,799 where education really worked. So why can't we have economic 303 00:18:20,000 --> 00:18:27,119 education and personal finance education because we've proven that society 304 00:18:27,119 --> 00:18:31,960 as a whole can actually change their attitudes their behavior. 305 00:18:32,640 --> 00:18:35,720 And you know, I can't say about what they're eating 306 00:18:35,759 --> 00:18:39,039 there as far as processed foods, but at least they're 307 00:18:39,039 --> 00:18:42,119 not smoking cigarettes and taking ten twenty thirty years off 308 00:18:42,160 --> 00:18:44,319 their lifespan like it once were. 309 00:18:45,839 --> 00:18:48,720 Speaker 1: Yeah, no, I know what you're saying. I loved smoking 310 00:18:48,759 --> 00:18:51,920 when I smoked, but yeah, I get your point. I 311 00:18:52,000 --> 00:18:54,119 guess my point there is that we didn't need education 312 00:18:54,279 --> 00:18:58,720 for that. We knew and people knew. People knew. They 313 00:18:58,799 --> 00:19:03,160 knew tell when you're a smoker, you know how you feel. 314 00:19:03,640 --> 00:19:06,119 But there's joy in it, and so people do things. 315 00:19:06,240 --> 00:19:08,680 You know, I don't bungee jump. Some people bungee jump. 316 00:19:08,720 --> 00:19:13,799 I like to smoke. I didn't wear masks during the lockdowns. 317 00:19:14,319 --> 00:19:17,839 That didn't fear me, but it fears scared some people. So, 318 00:19:17,920 --> 00:19:18,920 you know, living. 319 00:19:19,480 --> 00:19:21,559 Speaker 3: That's your thing, where two or three who carries? 320 00:19:22,039 --> 00:19:24,039 Speaker 1: Yeah, you know, let people figure it out. They'll figure 321 00:19:24,039 --> 00:19:28,000 it out, watching and including If lack of masks was 322 00:19:28,079 --> 00:19:30,640 killing people, people would start wearing masks, if that was 323 00:19:30,799 --> 00:19:33,119 the difference between sickness or death. 324 00:19:34,960 --> 00:19:35,440 Speaker 3: Education. 325 00:19:37,039 --> 00:19:40,440 Speaker 1: I just think people get it, you know. I love 326 00:19:40,640 --> 00:19:43,920 people say, well, the pessimists in our myths, they say, oh, well, 327 00:19:44,000 --> 00:19:46,200 things are so bad, And I think, well, in the 328 00:19:46,279 --> 00:19:51,839 nineteen seventies, the Civil Aeronautics Board sexually planned airline routes, 329 00:19:51,920 --> 00:19:55,759 airlines that were created by to move mail around. I 330 00:19:55,839 --> 00:19:57,960 remember in the nineteen seventies, and I know you did 331 00:20:00,160 --> 00:20:03,079 odd and even days for gasoline and waiting long lines 332 00:20:03,079 --> 00:20:07,839 for gasoline because both sides bought into price controls. I 333 00:20:08,079 --> 00:20:11,759 remember that you couldn't own a phone back then, you 334 00:20:11,759 --> 00:20:16,240 had to rent it from the government's preferred monopoly. Yeah, 335 00:20:16,359 --> 00:20:22,599 you talk about taxation, The top rate was seventy percent, 336 00:20:22,799 --> 00:20:26,039 and Ronald Reagan was ridiculed not just by Democrats but 337 00:20:26,079 --> 00:20:28,920 by Republicans for having the temerity to say that we 338 00:20:28,960 --> 00:20:31,680 should lower the rate. They said it had caused cause inflation, 339 00:20:32,599 --> 00:20:36,680 and probably the dumbest one of them all was the CIA, 340 00:20:36,799 --> 00:20:39,480 and most of the economists of the CIA, but economists 341 00:20:39,480 --> 00:20:41,519 in general, they also, well, you know, Soviet Union's just 342 00:20:41,559 --> 00:20:45,279 a different economic system, but there's as almost as large 343 00:20:45,279 --> 00:20:49,480 as ours. Don't tell me that we haven't improved. Don't 344 00:20:49,480 --> 00:20:52,279 tell me things that things aren't better, that people aren't 345 00:20:52,279 --> 00:20:57,200 more knowledgeable. None of those ideas would last a second 346 00:20:57,839 --> 00:20:59,480 in any economic discussion. 347 00:20:59,519 --> 00:20:59,839 Speaker 3: Today. 348 00:21:00,160 --> 00:21:05,079 Speaker 1: We're much smarter, not because of school. Again, the conservatives that, 349 00:21:05,200 --> 00:21:08,319 oh my gosh, they're socialists. Oh these democrats are like 350 00:21:09,119 --> 00:21:12,839 people figure it out, you know, we're not babies. We 351 00:21:12,880 --> 00:21:14,680 can look around, we know it works. 352 00:21:15,039 --> 00:21:16,920 Speaker 3: Yeah, well I'm surprised. You know. 353 00:21:16,960 --> 00:21:21,480 Speaker 4: I've been at Austrian economist or devotee of the Austrian 354 00:21:21,559 --> 00:21:25,720 school since I'm twenty years old, so going on clos 355 00:21:25,920 --> 00:21:31,559 fifty years, and what amazes me is people actually understand 356 00:21:31,599 --> 00:21:34,359 the concept that when you print money and it's not 357 00:21:34,519 --> 00:21:39,400 backed up by increases in productivity, that you get this 358 00:21:39,480 --> 00:21:44,839 thing called inflation. You know, it surprises me, like how 359 00:21:44,880 --> 00:21:49,599 knowledgeable much of the public's become about that. So but 360 00:21:49,880 --> 00:21:53,680 education in that yes, everybody knew cigarettes were bad for you, 361 00:21:54,119 --> 00:21:58,680 but they didn't know exactly how bad they were. I think, yeah, yeah, 362 00:21:58,720 --> 00:22:01,759 I don't feel as good. But you know, I think 363 00:22:01,839 --> 00:22:07,160 the information was hidden from plain sight. But now I 364 00:22:07,200 --> 00:22:12,039 think education, as far as economics goes, it's all Kynesian. 365 00:22:12,160 --> 00:22:15,440 You know, it's all kind of Kynesian brainwashing. And I 366 00:22:15,480 --> 00:22:18,559 think the public is repudiating that. 367 00:22:18,640 --> 00:22:19,839 Speaker 3: Now, are they. 368 00:22:20,119 --> 00:22:24,480 Speaker 1: I've always argued that monetarism, that's just another sturdy leg 369 00:22:24,519 --> 00:22:28,480 of the Kynesian chair, no offense. I think Austrians in 370 00:22:28,519 --> 00:22:32,599 many ways have bought are a variation of Kanesianism. They 371 00:22:32,599 --> 00:22:35,799 imagine that central banks can just produce excess credit. Now 372 00:22:35,839 --> 00:22:39,400 credit is produced in the private economy. So Kanesians say 373 00:22:39,400 --> 00:22:42,319 that government spending drives growth, and so too much government 374 00:22:42,400 --> 00:22:45,519 spending causes inflation. Oh, police, governments can't spend what they 375 00:22:45,519 --> 00:22:48,759 have taken from us. You've already explained that. Sure, money 376 00:22:48,839 --> 00:22:53,839 that circulates circulates because of production. Forget about money printing 377 00:22:53,920 --> 00:22:57,200 and all this. If you go to Venezuela right now, 378 00:22:57,240 --> 00:23:00,359 you go to Iran, you go to Pyongyang. If you 379 00:23:00,400 --> 00:23:02,680 want to buy things, you better have dollars because no 380 00:23:02,680 --> 00:23:05,960 one's going to take the local currency correct. And so 381 00:23:06,079 --> 00:23:10,160 I say this as a way of saying money that's trusted, 382 00:23:10,480 --> 00:23:13,960 reasonably trusted. Now probably you and I. In our perfect world, 383 00:23:13,960 --> 00:23:16,480 the dollar would have a stable definition. I'd love to 384 00:23:16,519 --> 00:23:20,079 have it. But the dollar circulates globally, not because the 385 00:23:20,119 --> 00:23:23,920 FED put it there, but because where there's production, there's money. 386 00:23:24,480 --> 00:23:28,279 But then you have the Austrians saying that somehow, well, yeah, 387 00:23:28,319 --> 00:23:31,319 the FED can just create access credit. No one cannot. 388 00:23:31,920 --> 00:23:34,680 As Mesus was clear, we borrow money for what it 389 00:23:34,680 --> 00:23:37,519 can be exchanged for. And so if the FED can't 390 00:23:37,559 --> 00:23:42,119 create credit, only the private sector can create credit. And 391 00:23:42,200 --> 00:23:45,480 so if the FED tried to print money or whatever 392 00:23:45,559 --> 00:23:49,119 all this wacko stuff, the dollar would see circulating. 393 00:23:49,640 --> 00:23:50,200 Speaker 3: It doesn't. 394 00:23:50,880 --> 00:23:53,720 Speaker 1: Markets are smart, and no one's going to take a 395 00:23:53,799 --> 00:23:57,720 currency that was quote printed, because they're going to say, well, 396 00:23:57,759 --> 00:24:00,160 I won't get back as much as I brought to 397 00:24:00,200 --> 00:24:02,799 market for that currency. And so I just think they're 398 00:24:02,839 --> 00:24:05,160 all I think all the religions need to wake up 399 00:24:05,200 --> 00:24:08,400 and say that people are smart and they see they 400 00:24:08,440 --> 00:24:09,640 see through all this stuff. 401 00:24:09,799 --> 00:24:15,640 Speaker 4: Yeah, well, you know a lot of countries, every fiat 402 00:24:15,640 --> 00:24:20,039 currency out there has has done the same thing and 403 00:24:20,359 --> 00:24:24,839 eventually realize they're intrinsic value. The dollar is the one 404 00:24:24,880 --> 00:24:29,240 that has lasted the longest since it became fiat. You know, 405 00:24:29,279 --> 00:24:34,160 it's fifty four years now, so the experiment is ongoing. 406 00:24:34,880 --> 00:24:38,799 And you know, but the idea of a stable currency, 407 00:24:39,720 --> 00:24:42,640 the banks don't like it, right, Yes, oh I think 408 00:24:42,640 --> 00:24:45,519 they would love it. You think so, But then their 409 00:24:46,200 --> 00:24:51,000 loans become worth more, but yes, harder to pay back. 410 00:24:51,680 --> 00:24:53,799 Speaker 1: Why would they be harder to pay back? With a 411 00:24:53,799 --> 00:24:58,240 stable currency, you'd have suddenly, you'd have all this investment 412 00:24:58,519 --> 00:25:04,920 removed from inflation and hard assets representing existing wealth, and 413 00:25:05,000 --> 00:25:07,880 you could much more capably put it to work in 414 00:25:07,960 --> 00:25:12,480 new ideas. Let's never forget that the dollar fell substantially 415 00:25:12,519 --> 00:25:15,759 in the two thousands. I don't think it's unrelated that 416 00:25:16,920 --> 00:25:19,519 various US banks and investment banks were brought to their 417 00:25:19,599 --> 00:25:23,839 knees by this massive devaluation. Contrasts that with the eighties 418 00:25:23,880 --> 00:25:27,839 and nineties. Ronald Reagan didn't get it, but he ran 419 00:25:27,920 --> 00:25:32,039 on returning to a gold standard. Markets saw ahead and 420 00:25:32,119 --> 00:25:36,880 responded that gold collapsed during the Reagan years. Never forget 421 00:25:36,880 --> 00:25:40,559 that Bill Clinton's Treasury secretary Robert Rubin was big about 422 00:25:40,559 --> 00:25:44,519 a strong, stable dollar. Is in any surprise that Wall 423 00:25:44,519 --> 00:25:48,240 Street's golden years were during those years. Wall Street hates 424 00:25:48,440 --> 00:25:52,039 chaos because it makes a lot more money from investment 425 00:25:52,119 --> 00:25:56,920 banking than it does from trading. That's precisely why Jamie Diamond, 426 00:25:56,920 --> 00:25:59,559 once he took over at JP Morgan, got rid of 427 00:25:59,559 --> 00:26:02,640 all the is. He knew that investors wouldn't pay for 428 00:26:04,200 --> 00:26:07,519 trading profits. There's no money in that. Banks would be 429 00:26:07,640 --> 00:26:09,160 much better off with good money. 430 00:26:09,440 --> 00:26:12,319 Speaker 4: Yeah, they might be, but they are a beneficiary of 431 00:26:12,359 --> 00:26:15,839 inflation because the new money that's created, they get it 432 00:26:15,960 --> 00:26:18,319 first before appreciated. 433 00:26:19,160 --> 00:26:22,480 Speaker 1: No, no, again, If that were true, why did they 434 00:26:22,559 --> 00:26:25,279 nearly die in the two thousands, why were they Why 435 00:26:25,400 --> 00:26:29,920 was Wall Street on its knees in the seventies. Inflation's bad. 436 00:26:30,039 --> 00:26:34,599 Banks lend out money hoping to get something back. Inflation 437 00:26:34,759 --> 00:26:36,960 wipes out the value of their loans. Come on, you 438 00:26:37,000 --> 00:26:38,160 know that. 439 00:26:38,319 --> 00:26:41,200 Speaker 4: Well, yeah, that's why everything is adjustable now. But that 440 00:26:41,240 --> 00:26:46,200 doesn't really address the underlying problem that the dollars they 441 00:26:46,200 --> 00:26:48,880 are getting paid back are worth less than the dollars 442 00:26:48,920 --> 00:26:49,640 they loaned out. 443 00:26:49,880 --> 00:26:50,119 Speaker 3: Yeah. 444 00:26:50,200 --> 00:26:52,599 Speaker 1: No, well, it goes up and down. There are stages 445 00:26:52,599 --> 00:26:54,799 where the dollar's stronger. We haven't seen that in the 446 00:26:54,839 --> 00:26:57,599 twenty first century. I'll go to my grave saying that 447 00:26:57,680 --> 00:27:00,799 George W. Bush was easily the worst president my lifetime 448 00:27:00,880 --> 00:27:04,240 and one of the most awful of many things he does. 449 00:27:04,400 --> 00:27:06,519 Did that no one will ever talk about because no 450 00:27:06,559 --> 00:27:09,319 one talks about money anymore. Is they reverse the Reagan 451 00:27:09,359 --> 00:27:14,039 Clinton era of a strong stable dollar. His Treasury secretaries 452 00:27:14,359 --> 00:27:17,119 from Paul O'Neil on kept saying, Hey, what's the importance 453 00:27:17,119 --> 00:27:20,039 of a strong dollar. Well, it's the utmost importance. It's 454 00:27:20,039 --> 00:27:23,960 the most important current price in the world. They and 455 00:27:24,000 --> 00:27:29,200 the Bush administration oversaw a major devaluation. And it's no 456 00:27:29,400 --> 00:27:32,160 surprise from that where we went. 457 00:27:32,559 --> 00:27:37,680 Speaker 4: To boost to boost exports, the dumbest thing. It doesn't work, 458 00:27:38,000 --> 00:27:40,880 all right, John, So tell me where do we find you? 459 00:27:40,960 --> 00:27:43,200 How do we connect with you on the web? 460 00:27:43,640 --> 00:27:46,359 Speaker 1: Oh, you could go to Twitter or x. I suppose 461 00:27:46,519 --> 00:27:47,160 I'm on there. 462 00:27:47,279 --> 00:27:47,839 Speaker 3: I'm on. 463 00:27:48,160 --> 00:27:50,680 Speaker 1: I'm still editor of Real Clear Markets, and I put 464 00:27:50,720 --> 00:27:54,200 out a at least one column every day begging trying 465 00:27:54,240 --> 00:27:57,839 to convince people to think as I do, not very successfully, 466 00:27:57,839 --> 00:28:00,920 but you know you have to, as I always remind people, 467 00:28:00,920 --> 00:28:04,119 if you can even change thinking a little, that represents 468 00:28:04,119 --> 00:28:06,759 big progress. And so that there's all my books that 469 00:28:06,759 --> 00:28:10,240 everyone listening or watching should buy several copies of number eight. 470 00:28:10,480 --> 00:28:14,000 The Deficit Delusion comes out in August. 471 00:28:14,200 --> 00:28:15,039 Speaker 3: I'm ordering it. 472 00:28:15,119 --> 00:28:18,680 Speaker 4: I pre order on Amazon, and I guess it'll be 473 00:28:18,720 --> 00:28:22,559 available at Amazon and wherever fine books used to be. 474 00:28:22,680 --> 00:28:26,240 Speaker 1: Sold, right, Yeah, that's right, don't I'd like to say 475 00:28:26,240 --> 00:28:28,400 that it's going to be in bookstores everywhere, but I 476 00:28:28,440 --> 00:28:33,079 don't trust my sales history, so but Amazon for sure. 477 00:28:33,440 --> 00:28:36,119 Speaker 4: Yeah, all right, Hey, it's great to talk to you again. 478 00:28:36,400 --> 00:28:38,640 Great to connect. And if you've got a question for 479 00:28:38,720 --> 00:28:41,599 John myself, shoot me an email kl at Kerrie lets 480 00:28:41,640 --> 00:28:45,440 dot com. All of John's info will be in the 481 00:28:45,440 --> 00:28:49,160 show notes of this interview on Financial Survival Network dot com. 482 00:28:49,359 --> 00:28:51,680 When you go there, just ask that you please sign 483 00:28:51,720 --> 00:28:54,519 up for you free newsletter like over seventy five thousand 484 00:28:54,599 --> 00:28:55,680 of you have already. 485 00:28:56,160 --> 00:28:58,559 Speaker 3: John. Great connecting with you. We'll talk to you again 486 00:28:58,599 --> 00:28:59,039 real soon. 487 00:28:59,240 --> 00:29:02,880 Speaker 1: Thank you so much. Congratulations on your big viewership, Thanks. 488 00:29:02,720 --> 00:29:07,039 Speaker 2: For listening to carry Letz's Financial Survival Network, your solution 489 00:29:07,319 --> 00:29:11,119 to today's trying times. For the latest, go to Financial 490 00:29:11,240 --> 00:29:16,839 Survivalnetwork dot com. Financial Survival Network now more than ever