Speaker 1: Look, she alleges that there's so much corporate greed, but
in food that's ridiculous. For more than forty years, food
prices rose around two and a half percent a year.
Double digit food inflation began with the pandemic in the
disruption of the supply chain. But you know, the massive
negative effect economic effect was really exacerbated by Biden.
Speaker 2: You're listening to Carrie Lutz's Financial Survival Network, where you
get valuable information. You just can't find anywhere else to
thrive in today's trying times. You need the Financial Survival
Network now more than ever. Go to Financial Survivalnetwork dot
com and get your free newsletter and gift. Financial Survival
Network now more than ever.
Speaker 3: And welcome you are listening to and watching the Financial
Survival Network. I'm your host, Carrie Letz. Hey, we're just
about at the end of August. We got a phenomenal
guest for you today. His name is Robert H. Bork,
junior economist, journalist. He's known for the antitrust education Project,
and obviously not enough people out there have been educated
about antitrust because we still got a bunch of insane
policies going on. But Robert it's great to have you
on the show. We're talking about the proposed economic plan,
if that's not too broad by the candidate for president,
Kamala Harris not here to really talk about the efficacy
of her campaign, or what she has or doesn't have,
what she lacks as a candidate, or how she got there.
We're just talking policy here, which is what I like
to do best. After all, it is a family publication,
a family show, so we don't really like to talk
about the obscenity of politics as it's practiced in modern
day America today. So price gouging, all right, Like I've
always thought my supermarket was a price gouger.
Speaker 1: All right.
Speaker 3: But if they're gouging, they're really bad at it because
they should be making like fifteen to twenty percent profit
margins instead of a one and a half two percent.
Speaker 1: Where are they going wrong here? Where they're going wrong
is they're in a competitive marketplace for groceries or vegetables,
for all the things that you take home and serve
your family for dinner. And so they can't gouge or
as the Vice president would say, gauge, which she blew
her lying. She blew her lying. In the thing. But
it's a big word. Come on it. I wonder if
somebody wrote it the wrong way because they couldn't spell
on her staff. But you say, we were going to
do this, so let's all right, So back to price gouge, engaging,
the price gouging. Look, she alleges that there's so much
corporate greed, but in food, that's ridiculous. For more than
forty years, food prices rose around two and a half
percent a year. Double digit food inflation began with the
pandemic and the disruption of the supply chain. But you know,
the massive negative effect, economic effect was really exacerbated by
Biden's or we're doing politics, we're doing policy, you know,
of his inflation reduction acts, pumping three trillion dollars into
the pockets of consumers, leading to too much money and
chasing too few goods, and that, you know, I think,
I think this is correct. I've read this before. I
read it again. Every hundred days, we add a trillion
dollars to the national debt, correct, you know, And it's
it's outrageous. And that's where these prices, those factors, that's
where the prices that she of course come from, and
the answer, of course, is to get the government out
of the economy as much as possible, to let the
marketplace actually begin to find its own level. But they
don't understand, and they don't believe in the marketplace. They
think it's all fixed by corporate corporation's private power. And
there you know, they don't understand that you can't outlaw
supply and demand, and only a fool or a liar
believes that you can. And I'll let you let your
audience decide which they are or both.
Speaker 3: Okay, But now, as a business person, and remembering the
last rounded inflation that we had Bob back in the
set these and eighties, Normally, under normal economic conditions, consumers
are resistant price increases. But when you're in an inflationary cycle,
I believe that consumers become they expect prices to go up.
And you know, your average business wants to keep their
margin constant or they want to increase it. So I'll
give you some examples here and give me your thoughts
on it, because I'm curious. Back in twenty twenty, McDonald's
profit margin was twenty five percent, then in twenty one
twenty two it went to thirty and then now twenty
three twenty four, it's at between twenty eight to twenty
nine percent. And the same thing has happened for each
Chipolte went from twelve to fifteen. Burger King they were
less greedy, they went from twenty to twenty one percent.
Uway went from eight to ten eleven, Taco Bill less greedy,
they went from fifteen to sixteen to seventeen percent. So
there are companies that do take advantage of it, But
isn't it really short term? They can't get away with
us in the long run because competition.
Speaker 1: Is going to rear its head again. I those margins, Now, yeah,
I had this question the other day from somebody saying, well,
you know, they're monopolies, and you know, and what's your monopoly?
You can raise prices. These companies are monopolas. But unless
it's the bad food marketplace. But yeah, exactly. But you know,
then once you're in control, you could raise prices. And
I said, and how long is that going to last
before somebody comes in and says I can beat that price.
You know, I can offer my hamburger for much less.
And that's what's going to happen. But the government, particularly
this government doesn't believe in letting the marketplace work. That's
they do. They think everything is every everything that happens
is an expression of greed and private power, and they
don't see a world in which a marketplace could be
the solution. And like my father said in the Anti
Trust Paradise, you know, the consumer is really the key
to all of this. You know, the consumer Welfare standard
which he put forward, in which the Supreme Court adopted,
which has been the anti trust operating system for the
last forty five years, is it's a principle that allows
you know, it puts the consumer at the center. And
if we would just actually put consumers at the center
of some of these other things that we're talking about
here and let the market place, let them decide, let
the market work. Gouging may happen briefly, but it's not
sustainable right right.
Speaker 3: And to give to follow up on the McDonald's thing
is they've seen their first sales decline since twenty twenty.
They're rethinking their price increases and their margin expansion, and
they're coming out with a new burger.
Speaker 1: And then McRib I mean, you know they're panicking over there. Yeah,
and they're going to extend their five dollars meal deal.
So you see, yeah, you can do it in the
short run, it makes sense, but then competitive market is
going to rear its ugly head for lack of a
better term, And you know, they always fail to appreciate
that there are substitutes, like, hey, I can make a
cheaper burger now at home than going to McDonald's. And
you know, if I use paper plates, I could just
throw out the dishes and not even worry about it,
right right, yeah, look again, I they're you know, unpleasant
things happen in the economy, things that we don't like.
WED like to be different. But I find generally speaking
that the bad things are a result of government intervention
and the good things that happen are a result of
the private sector and competition and innovation. But unfortunately the
government doesn't think that way. Even Republicans don't think that way. Yeah,
for the most part, and certainly these days there's so
many Republicans in the Senate and the House now who
fashion themselves as conservatives and thinks she's doing a great
job at the FTC that I wonder what happened to
the traditional traditional conservative economics. Maybe that'll come back I'm
not sure we have to wait till after Trump before
that happens.
Speaker 3: But yeah, well, it is fascinating that these people have
absolutely no conception. Now I remember, I'm old enough. When
Reagan came in, the first thing he did was decontrol
energy prices. Oil prices they were fixed at the barrel
head throughout the United States, and initially this caused a
price increase, and they said, oh my god, we're going
to have two dollars gasoline, which we'd be loving to
have now.
Speaker 1: And what happened.
Speaker 3: He unleashed competitive forces in the market, and the price
of gas dropped below a dollar. And you know, no
one could believe it.
Speaker 1: Now.
Speaker 3: He never got any credit for this, other than maybe
in certain economic circles, but that was a direct result
of decontrolling prices.
Speaker 1: And you know what happened.
Speaker 3: We never had another energy crisis where people were waiting
online to buy gasoline to fill up their cars because
there was a so called shortage. And you know, as
an economist, Austrian with an Austrian bent, you know, the
best allocator of any goods, any good or service, is
the price, right right.
Speaker 1: It's the fairest too, isn't it. It doesn't discriminate against
class or race or anything, which is one of the
reasons why I get so wound up when I see
this focus on changing. Coming back to my reason for
being protecting the consumer welfare stated, then they start wanting
to introduce other issues other than efficiency and price and
innovation and things like that, start talking about a worker
and equity and all that stuff. All that does is
skew everything to higher prices. Yeah, I had a professor
at law school and he said fair is a sissy word.
Who was that? Oh god, it was way back when.
I think it was my towards professor in law school.
But yeah, like, hey, prices go up, prices go down.
But if you look back, if we hadn't increased productivity
so dramatically over the years, the dollar would buy zero
at this point, wouldn't it correct? Absolutely correct?
Speaker 3: So how do you educate the people who were responsible
for making these often disastrous decisions. Is there a way
to educate them or do we just need to remove
as much power from the ruling class as possible.
Speaker 1: They don't know how you do that either. Well, Supreme
Court seems to have made a move in that direction. Actually,
in some ways restoring power to Congress and taking it
away from the independent agencies that will help educating them
if they want to be educated, would help, which is
what we try to do, and we try to do
it in a way that they understand that it's in
their self interest and the self interest of their constituents
to stick with this consumer welfare standard, which is a
neutral principle. It's not republican, it's not big D democrat,
it's low it's small D democratic. And it's the consumers
who make the decisions and not the government. And now
I'm not saying that there aren't reasons why one would
investigate and perhaps bring a case, but you know, against
a monopolist or against you know, about a deal that
could lead to monopoly. But generally speaking, I think business
knows best about what it needs to do to create
more efficiency and innovate than the government does. And the
government is always like you know, a decade behind, trying
to trying to you know, with industrial policy, trying to
use antitrust law, trying to use the power of government
to create, you know, to create a situation that they
think would be preferable within the one We have none
of those things ever, work. I can't imagine. You know,
the worst monopoly that there ever was, perhaps was AT
and T, and that was a government created monopoly in
in the telephone system. When they got rid of that,
I got, you know, now we're talking over cell phones
to each other with video. So, hey, what about the CAAB,
the Civil Aeronautics Bureau, I think it was called our board, And.
Speaker 3: They had all the prices fixed in the sixties seventies
in air travel and then somebody got what was his name, KHN,
got the brilliant idea of just getting rid of it. Yeah,
and then you know, like, look, we've got concentration in
the airline industry. There's definitely barriers to entry, a lot
of them government imposed, but on an inflation adjusted basis,
it's never been cheaper to travel. More people are traveling
than ever. And that's just one example. We got rid
of the Interstate Commerce Commission another one, and we got
to return to this. So you brought up indirectly, and
I'll bring it up the Chevron case. That was just
a recent overthrown which overturned by the Supreme Court, which
said basically that hey, courts don't know, government doesn't know.
The agencies are the experts, So anything they do, unless
it's flat out illegal, we have to defer to it.
And now, and I haven't talked with anybody about this,
so it's really opportune that you're here. What are the
long term effects? I mean, Congress, like you said, has
to take back responsibility. You can't basically climate change. They
haven't passed any laws about climate change, but the EPA
was attempting to use existing rules and statutes as a
justification to regulate carbon and gases, shut down power plants
all this. How profound is the impact here, Bob.
Speaker 1: I don't think we've fully realized how profound the impact
is going to be. If this begins over the next
couple of Congresses, UH, to result in in members of
Congress actually doing their jobs and making and making the
decisions that we have asked them and put them in
power to make, and not delegating it to unelected so
called independent agencies, then I think it could be serious.
We may actually see a situation that that where where
members of Congress actually UH will have to have hearings
and decide things in public, you know, and UH mayor
and right and and there their re election will depend
on whether or not. You know, they can't hide behind
an independent agency and about climate change or any of
any number of other things. Uh, yeah, it'll belonged to them,
and that'll probably rainy in some of the craziness. Yeah.
Speaker 3: And you know, the media, other than lamenting it, the
the overruling of the Chevron.
Speaker 1: Standard, there's been no coverage of it. Yeah. You hear
some people like, you know, upset about it whatever, but
you know, there really there's been no blowback yet. But
when the courts have to start striking down all these
rules and regulations, I mean conceivably, like twenty five percent
a third of the regulations that have been passed, aren't
going to muster that test, are they? No? Now? And
you know, I'm getting back to Vice President Harris and
her price gouging policy. She wants to put the the
responsibility for investigating and adjudicating these things in the Federal
Trade Commission, Lena Khan and Marxist and it's just not
going to work because the FTC doesn't have actual congressional authority,
statutory authority to do this. So so so much of
this is actual bs. You know, let's throw everything against
the wall now for the election and then say, oops,
I guess we really couldn't do that. But you know,
if she gets a majority, if she wins and she
gets the majority of the Senate of the House, who knows,
maybe they will do that. Then the Supreme Courts will
in two or three terms have to knock it down. Yeah,
that's problem.
Speaker 3: Yeah, I mean, look, the gun laws are basically all
struck down in one Supreme Court decision three years ago,
maybe is it four years ago? And now we're still
fighting over this. The cases all over the place. Some
have adhered to Justice Thomas's decision, others have tried to
do workarounds all of this. And you know, obviously we're
coming to the point where maybe they'll do what they
did with voting rights and segregation. They'll start appointing special
masters for all these states and say, you know, you
got to go with the special Master and do what
he says, or we're just going to strike everything.
Speaker 1: Now I worry greatly about this country when if it's
all going to fall on the Supreme Court and how
long can how long can the Supreme Court hang on?
They're trying to they try to pack the court, they're
trying to put in term limits. And I can't I
can't believe I grew up at a time when politics
was a little less combative and nasty and ideological. But
I guess that was a time when the Democrats controlled
everything and so therefore they didn't.
Speaker 3: Have to be and the media was monopoly itself. By
their own words, they should have broken that one up
a long time ago.
Speaker 1: Yes, you know, I was a journalist for a dozen
years before I decided it was just too corrupt and
I left. Good move, good move. Hey, so anti trust policy.
Speaker 3: So the Justice Apartment says that Jet Blue can't merge
with Spirit, spirits hanging on, they're losing money. But then
they say that Alaska Air can merge with Hawaiian Air,
which is similarly situated to Spirit. I mean, there's no
consistency here.
Speaker 1: No, there isn't. And I really wonder what rule you know,
that's the problem. If you don't have a standard. Again,
I come back to the Consumer Welfare Center, and it's
just all political choices, it's all subjective choices. Then the
airline industry, every industry doesn't know what it really is
allowed to do. You do we have to call up
Lena Khan and say, we're thinking of buying a box
of paper clips. Is that okay with you?
Speaker 3: We're buying a box of paper clips so we can
count them and just save money, right, kind of this
It is madness.
Speaker 1: It's utter madness.
Speaker 3: And as you so eloquently stated prior, the government doesn't
know what it's doing most of the time, which is
why you can't keep giving them more things to do,
because then you wind up like California.
Speaker 1: Right right, right? All right?
Speaker 3: So education, you know, that's one thing, like the One
Party says, oh, education is so important, and then when
you try to educate them about issues.
Speaker 1: That really are important, they don't want to hear about it. Yeah,
I'm not sure what else to say to that. It's true, like, hey,
education work great.
Speaker 3: People are smoking a fraction of the amount of tobacco
they used to smoke, right, and you know, hopefully cancer
rates will go down at least partly as a result
of that and the heart attacks and all that.
Speaker 1: So it worked there. It can work with the other
stuff too, if we just let it right. Well, and
I've got to say, if we believe in the freedom,
then people should have the freedom to you know, kill themselves.
I don't mean that literally, but in terms of but
I do think that we ought to educate people about
the benefits of certain lifestyle things. But then we got
to let them they're gonna do. Yeah, the balls in
your court. We did all we could now held you.
The rest is up to you because we can't do
anything else. Uh huh. But we are the government, so
we can, you know, come in and slap ugly warning
out on products, and we can try to remove products.
We can try to raise the prices so that you
won't use them, and uh yeah SCYN taxes, Yeah, yeah,
syn taxes. Look, look, the country was built upon the
tobacco industry, all right, either going to keep it legal
or you're going to get rid of it.
Speaker 3: But they don't really want to get rid of it,
and they don't really want people to stop smoking because
there's huge amounts of tax revenue that come in from
all these syntaxes. Right right, that's what Let's look ahead
to electric cars. I mean, the roads and so many
other things are built.
Speaker 1: On gas taxes. If really, if they really really get
rid of gasoline or reduce it, you know substantially, whether
think we're going to have charging taxes and you know
the damn things are the dam fakes are too expensive already,
and there are no charging stations. Well when you use
a public charger.
Speaker 3: Basically, I have an EV and not because I think
I'm going to save the world other reasons and I
do like it a lot, but has nothing to do
with why they're being marketed to the public. But you
know it goes evs when you go to public charging station.
It can cost as much or more than gasoline from
those stations and take five hours, right like forty minutes.
But you know, when you actually think about it, if
you have a home charger, like that's why I tell people,
if you don't have a charger at home, don't even
bother with it is just going to be time and money.
Unless you're a very infrequent driver, go for it. But
you know, to be giving me seventy five hundred dollars
because I bought an EV is the height of insanity,
isn't it?
Speaker 1: I think?
Speaker 2: So?
Speaker 1: Yeah? And there's no limit to that, right, there is
no limit if they sell one EV or they sell
ten million, and everybody gets tax credit as well as
it meets the criteria, right, right, and actually, and actually
who is paying for that all of the rest of
the people who don't have them and couldn't afford to
buy them.
Speaker 3: Anyway, right right, I mean economically it's not really a
bad deal, especially with the tax credit. But if you
couldn't sell it without the subsidy, then you shouldn't sell it, right,
isn't it basic? And when you subsidize stuff, you create shortages,
and when you tax it then you create surpluses.
Speaker 1: Right right, So as a Austrian economist, what do you
think You're perfectly happy to enjoy the subsidy.
Speaker 3: And hey, look, it's kind of like it's easy to
justify because as a tax paying individual, they're using my
money for so many useless things. I can I can
rationalize it. Okay, it might not be true, But am
I supposed to like to stick to my morality when
it's to my advantage?
Speaker 1: Not to?
Speaker 3: I mean, it's a hard thing to do it. Most
people won't do it. Now, I was going to buy
it anyway, I just took it. I guess I could
decide not to file the paperwork and forego my tax preadit,
But what good is that going to do?
Speaker 1: Okay? Right? Yes, I love a good rationalization when I
hear what Hey, I admit it, I admit it.
Speaker 3: But everybody, everybody pursues. The whole theory of economics is
in a free market, everybody pursues their own economic interest,
you know, without violating the rights of others first and foremost.
But you pursue your own economic interest, your own interest,
or your family, your community.
Speaker 1: And all that. Right. So that's what Milton Friedman says. Yeah,
and it works. Right. I'm not greedy, it's the other
guy is greedy. Right. Yeah, so I'm greedy, but I'm
greedy for a good call me case. I guess.
Speaker 3: I guess when you carry my rationalization through to everybody
else and all the other money they're getting, and the
corporate welfare and all the money that's been giving out,
that's the whole preps and the problem. Right, get rid
of their subsidies, not mine. But I'm willing to say
I'll forego my subsidy if you get rid of everybody
else's too.
Speaker 1: Right, none of us are willing to actually live by
the principles we espouse. So when I turned seventy next
year and I apply for my Social Security benefits, I'm
going to take them.
Speaker 3: Yeah, well, you paid it, and there you have the
best rationalization of all you paid into it, and you're
going to be lucky to break even on the deal.
Speaker 1: Right, you've been in.
Speaker 3: A private account mimicking the market by only a third,
you would be be getting five times more social security
than you're getting now, right, it's a deal for us,
is a great deal for our parents because they got
many times more than what they put in. But you know, okay,
so so where do we start here?
Speaker 1: All right? If we all like go to the poker
table and we're all putting our subsidies into the pot here, right,
and we see, yes, hey, we're going to start from
the beginning. But so hard to do that because oh,
you can't let Boeing go bankrupt, right, Boeing's vital to
the national interest. We can't allow that. And the airlines too,
because everybody wants to fly. Right, Well, they're only one
hundred thousand planes parked that in Arizona or something, right,
so yeah, well you know, and they're not getting any younger,
like the repit right, right, Hey, how do we connect
with you on the web? How do we get your work? Well,
the Antrust Education Project dot org is our principal social
media platform and all of my blogs and hop show
up there. You can also check us out on Twitter
ex elks, the site formerly known as Twitter. That's right
at antitrust Edu because it's you know, the handles are
too short, so okay, excellent.
Speaker 3: Well the links in the show notes of this interview
on Financial Survival Network. And while you're there, please sign
up for your free newsletter. Mister Bork, it's been an
absolute pleasure and honor to talk about these issues with you.
Wish you the best and we'll have you back on
at some point.
Speaker 1: I'd love to do that.
Speaker 2: Thank you very much, Thanks for listening to carry Letz's
Financial Survival Network, your solution to today's trying times. For
the latest, go to Financial Survivalnetwork dot com. Financial Survival
Network now more than ever