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Dr. Richard Ebeling on Liberalism
Episode 64 • 15th January 2023 • The Secular Foxhole • Blair Schofield and Martin Lindeskog
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Our newest episode, the first for the New Year, features Professor Richard Ebeling, where we discuss his recent defense of Liberalism. Tune in for his penetrating insights on a number of issues.

Call-to-Action: After you have listened to this episode, add your $0.02 (two cents) to the conversation, by joining (for free) The Secular Foxhole Town Hall. Feel free to introduce yourself to the other members, discuss the different episodes, give us constructive feedback, or check out the virtual room, Speakers' Corner, and step up on the digital soapbox. Welcome to our new place in cyberspace!

Show notes with links to articles, blog posts, products and services:

Episode 64 (46 minutes) was recorded at 2200 Central European Time, on January 12, 2023, with Ringr app. Martin did the editing and post-production with the podcast maker, Alitu. The transcript is generated by Alitu.

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Transcripts

Blair:

Good afternoon, ladies and gentlemen and welcome to another episode of the Secular

Blair:

Foxhole podcast.

Blair:

Today Martin and I are privileged to have Dr.

Blair:

Richard Ebeling.

Blair:

I hope that's correct.

Blair:

Who is the appointed BB and T distinguished professor of Ethics and Free Enterprise

Blair:

Leadership at the Citadel.

Blair:

He was formerly professor of Economics at

Blair:

Northwood University, president of the foundation for Economic Education from 2003 to

Blair:

2008 and was a Ludwig von Misuse Professor of Economics at Hillsdale College from 1988 to

Blair:

2003 and in Hillsdale, Michigan it served as Vice President of Academic Affairs for the

Blair:

Future of Freedom Foundation from 1989 to 2003.

Blair:

And the reason I have Dreaming on is he wrote a great defense of liberalism that was

Blair:

published in Capitalism magazine.

Blair:

Richard, how are you?

Richard:

I'm doing good.

Richard:

Thanks for having me on.

Richard:

It's a pleasure to be with you.

Blair:

It's great to have you again.

Blair:

The article was so thorough defense that I

Blair:

wanted to have you on for our audience.

Blair:

As I see it today, both the meaning of

Blair:

liberalism and of capitalism are either unknown by most Americans and or under

Blair:

constant barrage of false assertions.

Blair:

Would you define liberalism and capitalism for

Blair:

us?

Richard:

Sure. Liberalism began in the late 18th and early 19th century the 17 hundreds

Richard:

and the 18 hundreds as a movement dedicated to the underlying principles of individual

Richard:

liberty, private property, free enterprise, voluntary exchange, rule of law and limited

Richard:

constitutional government.

Richard:

The premise was that it was time to overthrow

Richard:

the monarchical systems of author carrying an in dictatorial government the rule of one or a

Richard:

few over the many.

Richard:

And now, to view each individual as securing

Richard:

his own rights to life, liberty and property and to deal with others on the peaceful and

Richard:

honest basis of mutual and voluntary trade and exchange and association.

Richard:

That's the philosophy, of course, that began really at the end of the of the 16 hundreds

Richard:

with John Locke's Two Treatises on Government in its modern form inspired the founding

Richard:

fathers of the United States as captured in the Declaration of Independence and of course,

Richard:

in the institutional structure underlying the Constitution.

Richard:

And then was the basis upon the various movements and crusades to assure a growing

Richard:

degree of liberty around the world.

Richard:

If I can just mention some of the leading

Richard:

forms in which this took since it seems to have been forgotten of the profound importance

Richard:

of them.

Richard:

The liberal crusades of the 19th century was,

Richard:

to begin with, the end of slavery.

Richard:

Slavery was one of the oldest human

Richard:

institutions in history.

Richard:

From all of recorded history.

Richard:

Some human beings had claimed the right to conquer and if not to kill, enslave others to

Richard:

do work that either the conqueror could not do himself or did not want to do himself.

Richard:

Only beginning in the 18th and then through the 19th century did the movement for the end

Richard:

to slavery rise and blossom under the liberal ideal.

Richard:

And by the end of the 19th century, for all intents and purposes, slavery as a practical

Richard:

and legal institution had ended in almost all corners of this planet.

Richard:

The Second Crusade was the idea of democratic government.

Richard:

That is, that the rule of one was wrong.

Richard:

And if a government is to rule over people,

Richard:

those ruled over should have a right to select those who held positions of authority, but to

Richard:

do what? Not to lord over them, but to secure and

Richard:

protect their liberty and through this democratic process.

Richard:

The third movement was for civil liberties.

Richard:

Through most of history, people had no rights.

Richard:

You spoke in a way that the king or the lord of the manor didn't like.

Richard:

He would lop off your ears, cut out, cut out your tongue, imprison you, kill you.

Richard:

And now it was said that each had these certain various civil liberties which included

Richard:

freedom of religion, freedom of press, of assembly, of speech, et cetera.

Richard:

This was revolutionary and transformed the world in the 19th century.

Richard:

The next one was freedom of trade.

Richard:

Governments controlled, regulated, restricted,

Richard:

commanded, planned economic affairs of their societies depending upon the technologies at

Richard:

the disposal of the political authorities.

Richard:

And by the end of the 19th century, there was

Richard:

the establishment of free competitive enterprise in many countries and if not always

Richard:

the perfect practice, the increasing ideal of freedom of trade internationally.

Richard:

And then finally, the last Crusade that the liberals were concerned for in the 19th

Richard:

century was harnessing, if not bringing to an end the destruction and the horror of war, the

Richard:

idea of adjudication, of disputes rather than cult arms and sending armies into battle with

Richard:

each other.

Richard:

Or that if conflicts arose to have rules of

Richard:

war, the treatment of prisoners, the respect for the life and property of conquered people

Richard:

in occupied areas, the limits on the type of weaponry that could be used because finally,

Richard:

wars end and you have to live in a common world with those who were previously your

Richard:

enemy.

Richard:

All of these are part of the radical

Richard:

transformation that either liberalism succeeded in or tried very hard to achieve.

Richard:

That is the meaning of liberalism.

Richard:

Most of the freedoms that we take for granted

Richard:

today, however fully or still now only imperfectly respected, have their origin and

Richard:

basis in the fight of the liberals of the 19th century.

Richard:

And we don't seem to have an appreciation and a respect for the achievements that they made.

Blair:

Agreed? Agreed.

Blair:

Sadly, you correctly point out in your article that both sides, what I call progressives and

Blair:

conservatives hate and denounce this the American system of liberalism and capitalism.

Blair:

And there's an old saying that, quote no one hates progress more than progressives, which I

Blair:

think is totally apropos.

Blair:

And for conservatives today, the election of

Blair:

Trump to me signifies the GOP's total rejection of its classical liberal capitalist

Blair:

element.

Blair:

What do you think?

Richard:

Well, unfortunately, the progressives, they're called social democrats

Richard:

or democratic socialists in Europe.

Richard:

Liberalism still has degrees of its original

Richard:

meaning in Europe, in the United States, they stole the world liberalism in the early part

Richard:

of the 20th century.

Richard:

So?

Richard:

So now, in the American context, liberalism means the belief in in political paternalism

Richard:

with an overreaching government that commands, restricts, redistributes, regulates controls,

Richard:

which, of course, is the exact opposite of that original liberalism that I explained a

Richard:

minute ago.

Richard:

But for the progressives liberal.

Richard:

For the progressives, the underlying premise that they either admit or just accept tacitly

Richard:

are the socialist premises that capitalism is an evil that exploits others, that private

Richard:

property is itself unjust, and that if we cannot abolish or do not feel that we should

Richard:

go to the extreme of the abolition of private property, then we should try to achieve the

Richard:

goals that the socialist wants equalization of income, what they view as producing.

Richard:

For need as opposed to profit through severe taxation to redistribute wealth and the

Richard:

regulation of industry and business and enterprise to force the private sector into

Richard:

the avenues of doing those things that those in political power in the name of the true

Richard:

interests of the people think they should follow rather than if they were left alone,

Richard:

guided by the profit motive to secure what the owners perceive as the demonstrated

Richard:

preferences of the general consuming public.

Blair:

Following that, Richard, today we hear a lot about capitalism was the cause of

Blair:

slavery.

Blair:

I think that's bunk.

Blair:

But what would your reaction be to that?

Richard:

Capitalism was the end of slavery.

Blair:

Exactly.

Richard:

Capitalism means that men respect each other's rights to their life and their

Richard:

property and can only acquire from the other what one wants through offering something in

Richard:

trade that the other is willing to freely take in exchange for what the first person would

Richard:

like to acquire.

Richard:

That is the opposite of slavery, of

Richard:

exploitation.

Richard:

It is basically treating each individual as

Richard:

being a unique person with dignity and rights, that you can only interact with them with

Richard:

their consent through their free association rather than through conquest and plunder and

Richard:

violence.

Richard:

If I can make one point about this, it is

Richard:

interesting that before the American Civil War in the 1850s, there appeared several books by

Richard:

a number of southern advocates of slavery.

Richard:

One was by a man particularly named George

Richard:

Fitzger.

Richard:

He published two books on this name in which

Richard:

he said slavery is a benevolent form of socialism compared to the evilness of northern

Richard:

capitalism.

Richard:

With free labor, the businessman pays his

Richard:

wages and cares nothing for what happens to those he employs.

Richard:

After he has paid them their wages, they're left alone in their lives.

Richard:

But the slave owner in the south, he cares for those who he's paternalistically responsible

Richard:

for.

Richard:

Does he not feed his slaves?

Richard:

Does he not house them? Does he not give them medical attention?

Richard:

Does he not care for them when they no longer could perform work on the plantation?

Richard:

All slavery is the most benevolent form of socialism.

Richard:

It is capitalism that is evil.

Richard:

So does the slave masters who oppose

Richard:

capitalism and would like to enslave all of us by ending capitalism.

Blair:

I'm dumbfounded, okay? Excuse me.

Blair:

Goodness.

Martin:

And Richard, you mentioned a book you were published 1919 by Englishman Elliot Dodd.

Martin:

Would you comment a little about that, how he started out in a good way where his liberalism

Martin:

dead, but when it turned out with his suggestions maybe paved the way to his new

Martin:

liberalism, the social Democrats and Democrats, socialists and so on.

Blair:

Yeah.

Richard:

The hook that I used in this article, which you mentioned liberalism, True and

Richard:

false, was a book that a man named Dodd wrote in 1919, shortly after the First World War.

Richard:

And the title book is Liberalism Dead.

Richard:

And you capture here a clarity and a confusion

Richard:

about what liberalism means.

Richard:

He begins the analysis by talking about those

Richard:

great achievements of liberalism that I spoke about a few minutes ago.

Richard:

The respect and dignity for the individual, the idea that he has certain rights that may

Richard:

not be violated, the triumphs of a society based upon rule of law and freedom of

Richard:

association and exchange, the end of slavery and so on.

Richard:

But he says but in the end of the 19th century, it was realized that that this older

Richard:

liberalism that had done all these fine things was purely negative.

Richard:

That is, it merely said that one person could not abridge another person through violence or

Richard:

fraud.

Richard:

But there needs to be a positive notion of

Richard:

freedom.

Richard:

It's not enough to be free of the coercion of

Richard:

others.

Richard:

If you do not have the positive ability to

Richard:

achieve the things that you value as good in life, then you are not free.

Richard:

And he's basically saying there that true freedom requires material access to the things

Richard:

of a good life a certain living wage, a certain standard of living, a decent housing

Richard:

and education, health care, the entire sort of catalog of the modern welfare state, if you

Richard:

will.

Richard:

The presumption here is that the higher

Richard:

liberalism recognizes that it's not the individual alone that matters, but it is the

Richard:

community, it is the society, it is the group that must be taken as the higher context in

Richard:

which the individual lives.

Richard:

And the presumption is that, therefore, that

Richard:

those who have more than others in society have a duty, a responsibility which government

Richard:

is to use its coercive power to enforce to see that those who have more will be compelled to

Richard:

give part of what they have to those who those in political authority deemed to have too

Richard:

little, who have less.

Richard:

What Dodd and this new conception they were

Richard:

called the social liberals, the advocates of social liberalism in the late 19th and early

Richard:

20th century, particularly in England, was this idea that the higher freedom required

Richard:

harnessing and limiting the freedom of some so all could have a certain equal standard of a

Richard:

standard of life.

Richard:

The question that was never answered is that

Richard:

if the older liberalism saw as its hallmark the end to slavery and the dignity and the

Richard:

respect of the individual to guide his own life and keep the fruits of his own labor.

Richard:

How are you not turning your back on that ultimate essence of the older liberalism when

Richard:

you now say that? I think that some have too little while others

Richard:

have too much? And of those who you define as having too much

Richard:

are not willing to voluntarily give it as charity or philanthropy, we, the society, will

Richard:

compel you to give some of it.

Richard:

And that means that some are forced to work

Richard:

for the benefit of others without their consent.

Richard:

Is that not the essence of a slave? Where the taskmaster says this is the work

Richard:

you'll do out of what you produce.

Richard:

This is what I decide you will keep.

Richard:

And I will give the surpluses of what you produce above what I think you should have to

Richard:

those others who I think it and in the slave master's direct sense in the old slavery, of

Richard:

course, that was the slave master and his family himself.

Richard:

But here it's the benevolence of the political elite who transcends society and look above

Richard:

all the petty interests of the one to assure a justice to the all.

Richard:

There's an arrogance, a uterus, a presumption that some are to play, if you will, a secular

Richard:

godlike role of deciding who has too much too little.

Richard:

And some will be compelled to give whether they wish to or not and that that type of

Richard:

compulsion will not undermine the very basis of both freedom and prosperity in the long

Richard:

run.

Blair:

Well, that's patently wrong in my personal opinion.

Blair:

But nonetheless, for me, both movements the progressives who want to control the economic

Blair:

realm and the conservatives who want to control with the individual who the individual

Blair:

can love or associate with they're coalescing today to me.

Blair:

For those of us who advocate individualism capitalism freedom, should we be worried?

Blair:

This seems to be quite a powerful combination.

Richard:

Unfortunately, it is part of the distinction between the older classical

Richard:

liberalism and, let's say, more modern American conservatism through a good part of

Richard:

the second half of the 20th century was due to the Cold War.

Richard:

Certainly both old fashioned classical liberals and most conservatives opposed

Richard:

communism for various similar reasons.

Richard:

But it it couched and hid the fact that the

Richard:

underlying premises of conservatives in the American sense in which we're talking about

Richard:

right now and classic liberals is fundamentally different.

Richard:

The conservative often has no reluctance to use the powers of the state for the imposition

Richard:

of other types of restrictions and controls on the members of society that he thinks needs to

Richard:

be established compared to those on the progressive left.

Richard:

For example, it has been common in the United States that the conservative says, yes,

Richard:

freedom is good, but we really need to restrict and control or prohibit what things

Richard:

you read, what things you watch, what type of substances you ingest the type of

Richard:

relationships you enter into, no matter how voluntary and peaceful they may seem, that we

Richard:

deem them to be irreligious or immoral or culturally unacceptable.

Richard:

And the state has a role to restrain these things and to educate good values.

Richard:

And in more recent forms.

Richard:

Again.

Richard:

There's an underlying sort of collectivist nationalism where liberalism just gives so

Richard:

much latitude to the individual that he loses his sense that he's part of a wider national

Richard:

community and that the state has an educational role to.

Richard:

Transform each individual into a good citizen, a good defender of the national interest,

Richard:

with, of course, those in political power defining what the national interest is.

Richard:

Basically, conservatives are as much political paternalists as the progressives.

Richard:

Only their sort of list of items to use the state to impose upon others in society is

Richard:

different from those among the progressives.

Blair:

Yes, you mentioned a moment ago about that the left stole the definition of

Blair:

liberalism.

Blair:

So how important is the correct use of

Blair:

language and definitions? I think it's more crucial today to fight for

Blair:

freedom and reason and logic and so on.

Richard:

Well, my wife, who is a retired professor of history and is also a liberal in

Richard:

our sense and has herself a Russian who lived a good part of a life in the Soviet Union

Richard:

would sometimes go into her classes, her history classes and say I believe in the

Richard:

sanctity of words and their original meanings.

Richard:

And liberally used to mean someone who

Richard:

believed in the rights of the individual and the sanctity and freedom of the individual in

Richard:

all the facets of his existence.

Richard:

And the word gay used to mean happy, cheerful.

Richard:

And so I, true to the full original meanings of the words, view myself as a gay liberal.

Richard:

No words matter.

Richard:

This is a serious matter.

Richard:

A word carries an historical connotation.

Richard:

It creates images in people's minds.

Richard:

For example, that's the reason why I wrote another piece not that long ago, if I can

Richard:

allude to that on the importance of liberty and the abuse of the word freedom.

Richard:

Freedom and liberty were never, in the dictionary sense completely the synonymous,

Richard:

but they were very close parallels to most of modern history.

Richard:

The progressives have increasingly stolen the word freedom.

Richard:

Freedom used to mean the freedom to live your life you wanted, the freedom to associate as

Richard:

you chose, the freedom to keep the fruits of your labor and so on.

Richard:

But now freedom is talked about freedom from the hardships of an uncertain retirement, the

Richard:

freedom from the uncertainties of having the financial means for your health care, the

Richard:

freedom from a decent roof over your head.

Richard:

That freedom means to be free of these wants

Richard:

and worries and concerns and that's the role of government to provide.

Richard:

And so freedom has been undermined as a word in that way.

Richard:

What is interesting is that the left has not been able to do the same thing with the word

Richard:

liberty because liberty still has the connotation and the sound.

Richard:

I think in most people's years of the idea I have the liberty to live my own life.

Richard:

I have the liberty to keep that which I've honestly earned.

Richard:

I have the liberty to decide who my friends are and so on.

Richard:

Liberty still has this idea of the autonomous individual free from the coercion of others to

Richard:

peacefully follow his own meanings and desires and, and purposes of life.

Richard:

It would be a disaster if the word liberty was stolen from us the way they took liberalism

Richard:

and have now been twisting in very political discussions the word freedom.

Richard:

Words matter because once you capture words, you undermine the way people think about

Richard:

themselves and relationships in society.

Blair:

Great.

Blair:

What do you see as today's what I'll call

Blair:

devolving political situation here in America? I mean, as far as both of these factions, if

Blair:

you will, joining together.

Blair:

I mean, I think environmentalism might be the

Blair:

gateway for both parties to unite.

Blair:

I hope I'm wrong.

Richard:

Well, I view the entire issue of what has become under the general public discussion

Richard:

headings of global warming, climate change as a particularly dangerous recourse for the

Richard:

social engineers, the political paternalists, the economic planners, because they set up

Richard:

this idea the world is going to end in twelve years.

Richard:

That imagery like that young Swedish girl Thornberg, who gave that talk, Betty?

Richard:

Yes, Greta Thunberg, who gave that talk at the end?

Richard:

Who dare you? You've taken away my future by destroying the

Richard:

planet.

Richard:

You owe it to me.

Richard:

And the thing is that the idea of the climatology and the physics of what's going on

Richard:

is so beyond most people's common understanding and ability to analyze, that

Richard:

it's easy to create this apocalyptic, apocalyptic imagery that unless we do

Richard:

something on both a national and a global scale, it's curtains for the human race.

Richard:

So, so climate change is, is in a sense the most recent refuge of those who want to

Richard:

socially engineer our lives in a comprehensive sense.

Richard:

Because if the world is going to end because of the, the wickedness of our profit seeking

Richard:

personal activities, then surely we must all be sacrificed for the good of the planet and

Richard:

future generations and the little sea otters whose lives will be extinguished with ours.

Richard:

And this makes this global business very disconcerting.

Richard:

Now, I don't claim to be a physicist or meteorologist, a climatologist, but I know

Richard:

that there is enough dissent by people who may or may not be classic literals to suggest that

Richard:

there is no degree of magnitude, of concern that the human element has really been doing

Richard:

this or the dangerous severity that will come about if we did nothing.

Richard:

Is the climate changing? Might very well be.

Richard:

But the climate has been changing on this planet for about, what, how many billions of

Richard:

years this thing has been revolving around the sun?

Blair:

Exactly.

Richard:

But I believe this is dangerous.

Richard:

And the conservatives just have their own

Richard:

variations on these things.

Richard:

But the biggest danger now is the progressive

Richard:

push, basically the latest socialist push for this.

Richard:

But if I can just point one more thing here.

Richard:

The diversity of this is that if you read the

Richard:

things that are presented by the World Economic Forum that's a group that meets in

Richard:

Davos, Switzerland, once a year, they don't call for the nationalization of the means of

Richard:

production.

Richard:

They insist upon that private corporations

Richard:

first voluntarily agree and then, if you read their publications, then establish a benchmark

Richard:

for governments to impose.

Richard:

But all private businesses, all private

Richard:

enterprises will follow rules, criteria, planning restrictions and methods to assure

Richard:

that there's a uniform targeting of how the planet is to be saved.

Richard:

Now, if the government plans and directs the economy but does not nationalize the means of

Richard:

production but imposes its rules and commands through orders to private enterprises that had

Richard:

a name in the 20th century? In the first half of the 20th century?

Richard:

Italian Fascism.

Martin:

Yes.

Richard:

Is the planning mentality through the resurrection of the latest form of economic

Richard:

fascism?

Blair:

Yes. Fascism. Yes. So turning from that, let's go back to can you give brief

Blair:

biography of great men like John Locke and Ludwig von Mises and other champions of

Blair:

liberalism?

Richard:

Well, that's a tall task and to do so in a few minutes.

Richard:

But John Locke was a very famous British political philosopher in the second half of

Richard:

the 16 hundreds.

Richard:

He is most famous for a tract that he wrote on

Richard:

tolerance that one should respect the freedom of conscience, the freedom of speech and

Richard:

press.

Richard:

Because who can so arrogantly presume to know

Richard:

the truth so perfectly and absolutely? As to assert that they could not be corrected

Richard:

or could not fail to understand that men must be allowed to think freely and debate and

Richard:

discuss and argue.

Richard:

And through this, a greater understanding of

Richard:

the world and themselves will arise.

Richard:

But he's most famous for his Two Treatises on

Richard:

Government, which came out right towards the end of the 1600.

Richard:

Volume one is a critique of why absolute monarchy is false.

Richard:

But the Second Treatise is his positive defense of the natural rights of the

Richard:

individual to his life, his liberty, his honestly acquired property and the only

Richard:

justifications for men forming their mutual association of defense, which is government as

Richard:

a means to secure those liberties and not to violate them.

Richard:

That has had a profound effect.

Richard:

The locks ideas had a profound effect on all

Richard:

that has happened since.

Richard:

All those crusades of liberalism in the late

Richard:

18th and especially the 19th century that I elaborated sort of at the beginning have their

Richard:

fundamental inspiration in the lateian notion that rights come by our nature or by God or a

Richard:

combination of the two which no other man has a right to violate.

Richard:

And it is only through respect for these that the highest moral virtues can be achieved

Richard:

among human beings.

Richard:

If we then fast forward the same year as our

Richard:

Declaration of Independence, 1776.

Richard:

There appeared in March of that year adam

Richard:

Smith's famous book, The Wealth of nations.

Richard:

Adam Smith was a professor of moral philosophy

Richard:

in Scotland.

Richard:

He had first booked published a book on the

Richard:

Theory of Moral Sentiments.

Richard:

But it's The Wealth of nations in which he

Richard:

laid out the understanding of why government planning and regulation was not only bad in

Richard:

itself from the freedom point of view, but was anathema to the potential for increasing

Richard:

betterment to the human condition.

Richard:

That when there's a system of what he called

Richard:

natural liberty, government limited to the functions of protecting life, liberty and

Richard:

property and men may freely associate involuntary exchange, their mutual

Richard:

improvements through self interested transactions will be the ultimate basis of the

Richard:

wealth of nations.

Richard:

And the elimination of poverty and the rising

Richard:

prosperity of all his ideas and all the economists inspired and developing out of him

Richard:

are the basis of the economic material prosperity that we all have today.

Richard:

Then again, fast forwarding rapidly, if I may.

Richard:

In the 20th century you have such leading

Richard:

voices of liberty as you mentioned in Ludric Vanishes.

Richard:

Ludric von Mises was a very well known Austrian economist both in the sense of a

Richard:

school of thought as well as coming from Austria.

Richard:

He was born in 1881.

Richard:

He died in 1973 and his contributions were

Richard:

several.

Richard:

Let me sort of start with the the he developed

Richard:

this theory that that it's not a matter of saying well, I like certain things in a free

Richard:

society and I like certain things in a socialist society.

Richard:

He said that institutionally a society can only have both freedom and prosperity with a

Richard:

certain set of preconditions and that is private property, freedom of exchange and free

Richard:

pricing through supply and demand.

Richard:

Socialism abolishes these institutions.

Richard:

It takes away private property by nationalizing it.

Richard:

It ends all freedom of exchange because if the government owns all the means of production,

Richard:

there's really very little to buy and sell and there's obviously no pricing through people

Richard:

HIGGING and trading in the marketplace.

Richard:

But his argument without market prices there

Richard:

was no way of knowing what consumers wanted, what producers thought they could offer it to

Richard:

the market at.

Richard:

And if there's no buying and selling, there's

Richard:

no agreed upon terms of trade.

Richard:

If there's no agreed upon terms of trade,

Richard:

there's no consummated prices.

Richard:

And if there's no prices, how do we know what

Richard:

value consumers place upon things they would like to have?

Richard:

How can we know if there are no prices for the means of production, what producers think they

Richard:

could offer on the market and at what prices? That would make it at least minimally

Richard:

advantageous to supply it to their fellow human beings.

Richard:

And therefore, without prices and markets, socialism would lead to what he called planned

Richard:

chaos.

Richard:

This is profoundly important because it

Richard:

basically shows why all socialist systems that attempted to impose comprehensive central

Richard:

planning on their societies were bound to fail.

Richard:

It's basically the economic reason why at the end of the day, the Soviet Union had to end.

Richard:

Now, a student of his, a protege of his, colleague of his was also the well known

Richard:

economist Friedrich A. Hayek who won the Nobel Prize in Economics in 1974.

Richard:

He was born in 1899.

Richard:

He died in 1992.

Richard:

Hayek's basically claim on this type of thing is that ultimately matching the division of

Richard:

labor is a division of knowledge.

Richard:

We all sort of common sense.

Richard:

We know this right there's the butcher, the baker, the candlestick maker, right?

Richard:

What he's saying is that more subtly there's knowledge of circumstances, opportunities, the

Richard:

abilities of what's available and how to use things that are available.

Richard:

But the people only in the various distinct corners of society, the local places of time

Richard:

and place, as he put it, can really know and know how to take advantage of it.

Richard:

So the central planner, arrogantly and presumptuously, thinks that he can accumulate,

Richard:

integrate, digest and then utilize more knowledge than any one person can ever have.

Richard:

So we either use the decentralized decision making and the informational avenue of

Richard:

competitive prices or we're going to be down a road of economic stagnation and hardship.

Richard:

This is a profound insight.

Richard:

I would argue from the economist point of view

Richard:

that that which one of us knows enough to plan the the lives of everyone else?

Richard:

Each of us must admit how little we know in terms of all the knowledge in the world and

Richard:

how much we are dependent upon the the knowledge that exists in little bits in the

Richard:

minds of all the now 8 billion people who share this planet with us.

Richard:

And it's only by allowing each to use the knowledge that they know, which most others

Richard:

don't have access to that we can benefit from what all know just as others can benefit from

Richard:

we know that they don't.

Blair:

Well, apparently Claus Schwab of the World Economic Forum thinks he knows.

Richard:

Unfortunately what Hayek in fact entitled his Nobel lecture that he delivered

Richard:

after winning the prize in 1974.

Richard:

The pretense of knowledge, the arrogance, the

Richard:

hubris of those who think that they can know more than is beyond the human capacity that's

Richard:

what leads to tyranny and tyrants and terror.

Blair:

I want to throw in a question that I didn't actually sent to you, but concern is

Blair:

what's happening today.

Blair:

We're looking at what is it $30 trillion

Blair:

deficits now in the United States?

Richard:

The debt is over 31 trillion.

Richard:

We're now experiencing over $1 trillion annual

Richard:

budget deficits.

Blair:

Yes. And to pay the interest on that is another half a trillion dollars.

Blair:

What about would the do you think the United States would ever return to a gold standard or

Blair:

out of desperation or out of principle or what do.

Richard:

You think of the the is this $64,000 question about how we move away from the abyss

Richard:

before we fall into it? True, there was.

Richard:

A well known market oriented economist who died in 2000 named Mansur Olsen and back in

Richard:

the 1990s he wrote a book called The Rise and Decline of nations.

Richard:

He said that societies and governments that move in these collectivist directions are very

Richard:

difficult to break and reduce because they develop these spiderswebs of interconnected

Richard:

interests of the politicians, the bureaucrats, the special interest groups that feed at the

Richard:

trough of the state.

Richard:

And somewhat despairingly, he said it

Richard:

sometimes takes an economic cataclysm or a war to so weaken the strands of this

Richard:

interdependent political network before you can bring about a great change.

Richard:

His imagery was that the Nazis were totally defeated and then Germany could be rebuilt as

Richard:

a more democratic and not perfect, but obviously a more market society than the Nazi

Richard:

planned economy.

Richard:

I don't know if we have to go that far,

Richard:

Cataclysm, but I can say this, and this is what's important for us to think about, who

Richard:

care about these ideas of both personal and political and especially economic liberty, is

Richard:

that some crisis point will arise and it will become necessary to answer the questions how

Richard:

did we get there? And how do we escape from it?

Richard:

And therefore, in escaping from it, what path do we follow?

Richard:

A path further down government collectivism and paternalism or retracing our steps and

Richard:

moving back towards an even more better free market society.

Richard:

So between now and any sort of crossroads of that type that we have to then decide on it's

Richard:

important for us to be participating in and influencing the societal debates so that when

Richard:

the crisis comes, if it becomes that serious, more people will have accepted our views.

Richard:

It's the government that got us here.

Richard:

It's the presumptions that government should

Richard:

have the power and has the ability to do these planning policies that have gotten us to this

Richard:

abyss and therefore we don't want the horror of attempting to escape from our situation by

Richard:

having more of it.

Richard:

But we now must realize that it was the older

Richard:

view of liberty that had given us the prior prosperity that we must now return to and try

Richard:

to improve upon it so that we don't have the likelihood of a return to a collectivism after

Richard:

we've restored liberty.

Richard:

That's the importance of the power and

Richard:

importance of ideas.

Richard:

Not really to be able to change things today

Richard:

because you just have the political currents of the moment, but to change the climate of

Richard:

opinion in the years to come before a full disaster strikes so that the terms of the

Richard:

debate can be greatly influenced by us rather than them.

Blair:

Well said.

Blair:

Well said.

Blair:

Following the talk about gold and silver, do you have any thoughts on bitcoin or crypto or

Blair:

have you studied that?

Richard:

I only say this the free society, if it is to be institutionally successful, must

Richard:

be one that is free from monetary central planning, that is, government control and

Richard:

direction of the banking and the monetary system.

Richard:

A free society would not have a central bank, including in the United States the Federal

Richard:

Reserve System.

Richard:

Instead, the market would choose some

Richard:

commodity or commodities that they would find most efficacious and efficient and convenient

Richard:

to use as a medium or several media of exchange.

Richard:

And that the institutional setting of financial facilitation would be through a

Richard:

competitive free banking unrestrained by government rules and regulations other than

Richard:

the common law that people are expected to abide by their contracts.

Richard:

What the market were decided, which means all of us, cumulatively as free interacting

Richard:

individuals, what the market would decide as the most efficacious of those medium exchange

Richard:

whether the old fashioned commodities like gold and silver or some type of ethereal type

Richard:

of medium such as bitcoin or some other that we don't presently have or could imagine, I

Richard:

don't know.

Richard:

But one of the purposes of freedom is to

Richard:

discover what serves people's interests the best by letting them follow what Hyatt called

Richard:

the competition of discovery.

Richard:

That is what we'd be shooting for an arena of

Richard:

monetary freedom.

Richard:

So we as individuals interacting could decide

Richard:

the best forms of monetary and banking system that serves our beneficial interests.

Blair:

Very good.

Blair:

Finally, Richard, what do you see for the

Blair:

future of individual freedom? Individualism and hopefully for capitalism.

Blair:

Is liberalism dead?

Richard:

If I can put it this way, one of the hardest things to predict is the

Richard:

unpredictable.

Blair:

Wow.

Richard:

And let me put it in this context it's very easy to be clouded by the

Richard:

circumstances of one's own immediate time.

Richard:

Let me explain it this way if we could go into

Richard:

a time machine to 1900, that is the beginning of the 20th century and we were to read the

Richard:

newspapers, the magazines, some of the political conversations of the time.

Richard:

What was this new century of the 20th century going to be like?

Richard:

Well, people look back at the 19th century.

Richard:

Well look, government is respectful of

Richard:

people's rights and the rule of law.

Richard:

We've been experiencing this grave explosion

Richard:

of material prosperity, increasingly global peace and trade.

Richard:

Surely the 20th century is going to be the same.

Richard:

Well then fast forward less than 15 years 1914 and there's the cataclysm of the first World

Richard:

War and out of that came the collectivisms of communism, fascism and Naziism and the

Richard:

interventionist welfare state of things like Roosevelt's New Deal.

Richard:

And then if you read the classical liberals, if you were grandparents of the 1930s, it's

Richard:

the twilight of economic freedom.

Richard:

It's the trial of liberty.

Richard:

We're on as high entitled his book we're on a road to serve them.

Richard:

It's the end of freedom.

Richard:

Well, in World War II, two of these tyrants

Richard:

bit the dust hitler and Mussolini.

Richard:

And then in the postal period people were

Richard:

concerned that this was going to be end of liberty.

Richard:

The communists were going to try off.

Richard:

There was a French social theorist named Jean

Richard:

Francois Ravel and around 1980, 519, 84, he wrote a book in French.

Richard:

He was translated into English a couple of years later called How Democracies Perish.

Richard:

The communists are dedicated.

Richard:

They know what they want.

Richard:

They're willing to die for it.

Richard:

We in the west have gotten weak and flabby.

Richard:

We don't know what we believe in and certainly wouldn't fight for it.

Richard:

And he doesn't end the book by saying the communities are going to win.

Richard:

But that's the conclusion you drew.

Richard:

Well, fast forward just a few years to 1991.

Richard:

The Soviet Union disappears from the face of the map.

Richard:

It's market oriented economies, not free market, but market economies that now replace

Richard:

a social central planning in Eastern Europe, for example, or even China, with its

Richard:

bastardized form of capitalism, moves away from Mao's craziness.

Richard:

Now fast forward to the beginning of the 20th century, 21st century.

Richard:

You have the 911, you have these invasions of Afghanistan and Iraq.

Richard:

You have the rise of China.

Richard:

Now everybody's saying again, it's the end of

Richard:

Western civilization, the new authoritarianism of the Putin's and the Zhijian, pains people

Richard:

like Orban, Hungary and so on with the Trumps of the world.

Richard:

This is the future.

Richard:

Nobody has a crystal ball.

Richard:

Ultimately, it is ideas that influence the course of human events.

Richard:

And it matters, as I was suggesting, how much we can influence the terms of the debate and

Richard:

the content of the conclusions that people hold in their mind about whether this will be

Richard:

the twice freedom or whether freedom will once again be restored.

Richard:

There's no trajectory of history that has to necessarily assure liberty, but it certainly

Richard:

doesn't mean that we have to fall into the abyss of tyranny again.

Blair:

Well set.

Blair:

Thank you so much.

Blair:

Richard Martin, do you have anything to add?

Martin:

Yes, please.

Blair:

Are you there?

Martin:

Download a new podcast app and for example, Fountain or Podwarz and then you

Martin:

could stream Satoshi's bits of Bitcoin and send a note to us what you think about this,

Martin:

if you value this podcast.

Martin:

So freedom of expression, liberty, and to

Martin:

having this kind of conversation in the future also.

Martin:

So thanks for that.

Blair:

Right. Well, Richard, thanks for manning the Foxhole with us today.

Blair:

We appreciate you coming on.

Richard:

My pleasure.

Richard:

And if you'll allow me to give myself a plug

Richard:

for those who might have found some of these ideas that I've tried to articulate but you're

Richard:

kind enough to allow me to express on your show.

Richard:

I do have a book in which I elaborate on many of these themes on political, social and

Richard:

economic freedom in the historical context that I've tried to talk about.

Richard:

It's a book called for a New Liberalism published by the American Institute for

Richard:

Economic Affairs.

Richard:

It came out in 2019 and it is available from

Richard:

Amazon, for example, and it's less than $20.

Blair:

Very good.

Blair:

Well, we'll put that in our show notes.

Blair:

Yes, a link.

Blair:

And then I want to get a link to your article

Blair:

that you mentioned earlier.

Richard:

I'll send you the link to it.

Blair:

That'd be wonderful.

Blair:

All right.

Blair:

Great.

Blair:

All right.

Blair:

Thank you so much, Mark, very much.

Blair:

Yes, very good.

Richard:

Thank you.

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