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April 5, 2022 - The Charlie Kirk Show
34:20
No Free Lunch—Economic Truth in an Era of Financial Insanity with Dave Bahnsen
Transcriber: nvidia/parakeet-tdt-0.6b-v2, sat-12l-sm, and large-v3-turbo
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Time Text
Two Black Justices in History 00:05:03
Hey, everybody, there is no free lunch.
Dave Bonson with us, author of There Is No Free Lunch, 250 Economic Truths.
Email me your thoughts.
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Buckle up, everybody, here.
We go.
Charlie, what you've done is incredible here.
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So I don't expect the media to know much about our history.
In fact, they are almost experts of not knowing anything about our history.
But when it's so blatant and honestly racist, the way they cover our country, it's worthy of a little bit of focus.
And so the not the non-biologist woman, at least I think she's a woman.
She won't tell us if she's a woman or not.
Katangi Brown Jackson, who's up to become the next Supreme Court justice, was selected simply because of her skin color and because of her chromosomes.
She's a very dumb person.
We realized that in the hearings.
Not exactly, very unimpressive.
I wish she was smart.
I want smart people on the Supreme Court.
She wasn't able to answer very basic questions about equal protection.
She can't tell you what a woman is.
She also was very lenient for baby torturers.
True story.
Very lenient for child pedophiles and very lenient for child predators.
She has a soft spot for predators.
Katangi Brown Jackson does.
Again, I don't find delight in saying any of these things, but it's who they decided to put up.
Senator Mark Kelly from Arizona, soon to be former senator, I hope.
We're going to do everything we possibly can at Turning Point Action, Turning Point Pact to get rid of him, has said that he's going to vote for Katangi Brown Jackson.
Raphael Warnock will probably follow suit, and Joe Manchin is as well.
I think Susan Collins has voiced support as well.
Now, they don't know history at all.
Now, the first black ever on the Supreme Court was Thurgood Marshall.
And then, I believe, Clarence Thomas was the second.
Is that correct?
That's it.
So, there's been two black people on the Supreme Court in our history: Thurgood Marshall and Clarence Thomas.
There's also one currently serving, Clarence Thomas.
But Politico, which again was the one that helped get Joe Biden get elected because they covered up the entire story with Russian disinformation smokescreen, tweeted out the following: quote, Katanji Brown Jackson will likely be confirmed as the first black Supreme Court justice by the end of this week.
Here's how we'll expect it to go.
How these people went to college, which is exactly why they don't know anything.
Katanji Brown Jackson will likely be confirmed as the first black Supreme Court justice by the end of this week.
Politico tweeted that out.
They deleted the tweet and then tweeted this correction quote for the record.
This replaces an earlier tweet that stated Katanji Brown Jackson could be the first black Supreme Court justice.
It should have said first black female Supreme Court justice.
We apologize for the error.
I could have wrote that for them.
We knew it was happening.
Senator Michael Lee ripped them.
Play Cut 22.
Earlier today, There was a Politico tweet.
Politico sent out a tweet reading as follows, saying, Katanja Brown Jackson will likely be confirmed as the first black Supreme Court justice by the end of this week.
Here's how we expect it to go.
Now, if that were true, that would come as news to the family of Thurcut Marshall.
It would come as great news to Justice Clarence Thomas and his family.
No kidding.
Now, of course, Joe Biden blocked the first black woman to go in the Supreme Court.
No one knows this story.
It was written up by Mark Tiesson at AEI.org.
Remembering the black woman Biden blocked from the Supreme Court.
Biden wants credit nominating the first black woman, but here's the shameful irony.
As a senator, Biden warned George W. Bush that if he nominated the first black woman to serve on the Supreme Court, he would filibuster and kill her nomination.
Joe Biden doesn't think much of black people.
He never has.
He's been incredibly racist throughout his entire career.
I believe he still is racist.
He never was held accountable for that.
You ain't black.
Biden Blocks First Black Woman 00:06:17
What are you, a drug dealer?
This kind of weird, kind of almost authoritarian pandering to the black community.
Biden also fiercely opposed Clarence Thomas, this kind of meandering story he tells about corn pop.
Biden is a bigot.
He always has been.
I don't say that lightly.
All he cares about is power, and that's been the story there.
But it's so interesting where Politico gets away with this, where they say, first black person to go on the Supreme Court.
Clarence Thomas, Thurgood Marshall.
Nowhere in there history.
Okay, I'm going to get to some other stories here that we have.
Let's talk about energy.
Let's play cut eight, Pete Budajej, the pothole mayor from South Bend, Indiana.
Play cut eight.
So less dependent on foreign oil, and that protects us from shortages at fuel stations.
But here's the thing to remember: even if all of the oil we use in the USA were made in the USA, the price of it is still subject to powers and dynamics outside of the USA, which means that until we achieve a form of energy independence that is based on clean energy created here at home, American citizens will still be vulnerable to wild price hikes like we're seeing right now.
Alfred E. Newman, with the commentary there on energy, I got to tell you that Pete Buttigieg really bothers me.
He bothers me on a couple different ways.
His arrogance, his smugness, his kind of like, he almost, he has this almost kind of entitlement.
He's like, I'm entitled to just good coverage at all times.
But he's such a creation of the corporate class.
Like, I was built for this.
I'm going to say exactly what I need to say when I need to say it, no matter what.
And what is he really saying there?
Well, he's saying that we have to get used to the price hikes until we achieve a form of energy independence that is based on clean energy.
No talking about oil and natural gas development here.
No talking about Keystone XL pipeline.
They would much rather buy the oil from Iran or from other Middle Eastern theocratic dictatorships than explore it here at home.
Play cut 31.
Right now I hear from everybody.
We are producing at record numbers.
We could be producing more.
Can we be independent right here in America?
We were energy independent under the Trump administration and we can be again.
Under Trump, we were producing 13 million barrels a day.
Last month we produced 11.6.
The American oil field is definitely capable of more and it frustrates me giantly when I hear Biden say calling OPEC wanting more oil calling Venezuela wanting more.
What about Texas?
What about North Dakota?
We can do it here.
We could do it here.
We could also explore the Marcella Shale.
We could explore in New York.
But there is a deliberate campaign to try and transition us out of this current state of energy consumption into some sort of undefined future.
They want to break it so that they could reset it.
Now, I have this amazing, we don't have the time in this hour.
So, either tomorrow or Wednesday, you guys got to keep your eyes peeled on the Charlie Kirk Show podcast page.
There are some phenomenal, actually phenomenal is not the right word.
Fascinating is the right word.
There's some fascinating new developments out of the World Economic Forum, all about new world order and all that.
I don't even want to get into that right now.
We have to build that out because there was a recent World Economic Forum summit, and I want to get into that into the weeds.
And I also got to do a future episode on Iran.
There's a lot happening with Iran, and it's so disingenuous, right?
So the media say, we hate Russia, we hate Russia, Biden, we hate Russia.
Putin's a war criminal.
So Biden comes out today and he says Putin's a war criminal, right?
Okay.
So he says Putin's a war criminal.
Which one's this right here?
Play cut 12.
He says Putin's a war criminal because of BUCA.
What's happening in Buka is outrageous.
Play cut 12.
You may remember I got criticized for calling Putin a war criminal.
Well, the truth of the matter, we saw what happened to Ruka.
This warrants him, he is a war criminal.
But we have to gather the information.
We have to continue to provide Ukraine with the weapons they need to continue to fight.
And we have to gather all the detail so this can be an actual have a war crime trial.
This guy is brutal.
And what's happening in Bukha is outrageous.
And everyone's seen it.
Abdula.
No, I think it is a war crime.
What do you mean, sir?
Are you going to do more sanctions on Russia?
I'm seeking more sanctions.
Yes, I'll have time to announce that to you.
So if Putin's a war criminal, answer this question, Joe Biden.
Why are you having Russia be the interlocutor?
Why are you having them be the go-between, the neutral party, in your negotiation with Iran?
If Russia was so terrible, Joe Biden, why are you relying on Russia to negotiate the Iranian nuclear deal?
We're going to keep our eyes on the Iranian nuclear deal, which could totally change the geopolitical winds of what's happened in the Middle East and across the world.
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Okay, so let's get to some more sound here.
Let's get to this one with Donald Trump was in Michigan this last weekend.
He had a rally, talked about the woke.
This is a winning message for him.
Play Cut 28.
The American people will not sit idly by and allow our children to be indoctrinated, segregated, and mutilated by the lunatic left.
That right there, that sentence can get him reelected as president.
Indoctrinated, segregated, and mutilated.
And that's exactly what's happening.
Now, of course, the other side, the Democrats, how are they reacting?
Well, Eric Adams is now announcing that he is going to put up gay billboards, pro-gay billboards all across Florida in an effort to try to draw people out of Florida and back into New York.
Eric Adams, who is supposed to be a common sense mayor, who's turning out to be a total disaster, says, quote, we are going to purchase digital billboards for the next eight weeks in five major Florida markets, including Fort Lauderdale, Jacksonville, Orlando, and Tampa and West Palm Beach, to attract gay people back to New York.
Why?
He can't really answer why.
Quote, New York City, where the Stonewall Inn riots ignited what many consider to be the birth of the modern LGBTQ plus movement, never heard of it, has long voiced its support for that community.
Now it wants its message to be heard in one place, especially Florida.
Of course, the homosexual community in Florida, for whatever reason, that Eric Adams is trying to pander to, do you think that I actually think many of the gays in Florida are in support of the fact that kids should not be taught about things that are this explicit when they're five, six, or seven years old?
The GOP legislation, which has drawn intense national scrutiny, no, it hasn't.
It's actually popular amongst Democrats.
Bars instruction on sexual orientation and gender identity in kindergarten through third grade, which the mayor called a target attack on the LGBTQ population.
They even say what it is in this news article.
The GOP legislation that has drawn intense national scrutiny barred instruction and sexual orientation.
Look, if you're against, let me say this differently.
If you're for teaching kindergarten, first, second, and third grade about sexual orientation and gender identity, you got some serious problems.
In fact, we should probably like surveil you, like some real problems.
But Eric Adams is totally on board for it.
He thinks that second graders need to be talked about lesbian and transgender stuff.
It's not a joke.
He says, quote, this is the city of Stonewall, whatever that is.
This is a city that we're proud to talk about, how we can live in a comfortably set it, comfortable setting and not be harassed.
What are you talking about?
Harassment.
This is important, that Florida has a significant gay population, especially in Clearwater and in St. Petersburg and in all of that.
So Eric Adams, the way he's going to try to make New York great again is recruit the gay population out of Florida to go to New York around this bill.
He says, quote, the billboards, Adams said, are from City Hall, which will be up for eight weeks in five major Florida markets, whatever.
And they'll deliver an estimated 5 million impressions.
And if you see it, so the, boy, I got to see if I can get this on the live stream.
It's so unbelievable.
So the poster he's putting up has gay all over it.
Gay, gay, It says, come to the city where you can say whatever you want.
No, you can't say whatever you want, actually, in New York City.
If I were to say Donald Trump was a great president, I would get harassed and probably beaten.
People say lots of ridiculous things in New York.
Don't say gay isn't one of them.
My goodness, these people are so dishonest.
When other states show their true colors, we show ours in all gay rainbow.
Eric Adams, loud, proud, and still allowed.
New York City is alive and so is free speech.
The gas, the gaslighting these people engage in.
We're talking about kindergarten first, second, and third graders.
And how does Eric Adams respond?
Responds with a complete and total design like that.
Gay, Come to the city where you say whatever you want.
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The Inflation Spending Trap 00:15:47
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There is no free lunch.
It's a pretty simple statement, but boy is it true.
With us right now is someone who is author of a book called There Is No Free Lunch, 250 Economic Truths.
Dave Banson is with us right now.
Dave, welcome to the Charlie Kirk Show.
Hey, good to be with you, Charlie.
So let's just kind of start with your book, kind of set the table here.
What do you mean there's no free lunch?
I got free stuff all the time, free stimulus checks.
Like, I mean, come on, no free lunch?
Yeah, the kind of twofold truth here is: A, it's never free for everyone.
There's someone paying the price.
And then I think the bigger economic takeaway, Milton Friedman famously, you know, used this language was that there's such thing as trade-offs.
So it's not just that there's no free things like when you get a stimulus check or whatnot, that someone's paying for it.
That's all true enough when it comes to public policy, the way we want to view things as conservatives.
But I think even economically, it's important to understand that to get something we want, we give up something we want.
When we go to buy something in the store, we give them our money.
It would be great if we could keep our money and get the thing we want.
But economics is about allocation of scarcity.
So there's a really important economic point here.
Yeah.
And so how do we try to solve the problem of scarcity through redistribution or is there another way?
Well, the way that has brought most people out of poverty for hundreds of years is this thing called free enterprise.
A free society that allows people operating in their self-interest with regard for community, with a regard for their fellow man, but to operate with freedom.
And I believe that we see empirical proof throughout history of the beauty of free enterprise.
But it's more than just what the state does to impede that with redistribution and how people like you and I may not think it's fair or may not think it's right.
It really hurts economic growth because the state can't know the things that are necessary and they can't have the incentives that are necessary to optimize scarcity, to optimize the allocation of resources.
So, people freely end up making better decisions, which leads to more macro economic growth.
That's the whole beauty of the free enterprise system, Charlie.
So, we're living through a period of inflation right now.
I remember I had a lunch in Palm Beach about, let me think about this, about a year ago, year and a half ago, and I said that inflation is coming.
I was laughed at by a bunch of Wall Street guys.
They said, Oh, we look at all the fundamentals.
There's no way it's not going to happen.
How did the experts get this so wrong?
I mean, I remember it was so clear and vivid.
People that are in the money management business told me, No inflation, never going to happen.
We don't have enough money, but now we're living through catastrophic inflation.
Yeah, I think that the inflation we're dealing with now is primarily on the supply side of the economy, and people weren't focused on that.
They didn't believe that the reopening of the economy after the absurd lockdowns was going to lead to this kind of surge in demand.
So, we're so used to thinking of inflation in the 1970s sense, where there's just too much money chasing too few goods and services, that it never occurred to people that ports not being open and people being incentivized to not go back to work after the extension of Biden employment benefits last year, the truck drivers not being there, the supply chain disruptions.
Those are the things that really caused a huge escalation in prices.
And so, I think, Charlie, we have to be afraid of two inflation levels we're dealing with because of what is going on right now in the supply-demand imbalance.
But then, longer term, I'm very afraid of stagnant economic growth because the excessive indebtedness that we have created in the economy, we go into a Japan-like mold where we can't even, they won't even be able to get inflation in the future because there's too much downward pressure on economic growth, the production of goods and services.
We need to be a vibrant, healthy economy.
So, what can the government do at this point from a public policy standpoint to try to check inflation?
I mean, do rates have to go up or taxes be cut?
What has to be done?
Yeah, I mean, usually when the question starts with what does the government have to do, I want to jump in and say nothing.
Well, that's right.
But, I mean, that's an answer, right?
That's actually doing something, right?
Yeah, but sometimes they need to remove impediments.
And in this case, I think a lot of the policy side of things regarding the supply chain could be much, much better.
I was shocked late last year when they said, Oh, the Biden administration is announcing that the port workers are now going to be allowed to work more than eight hours a day.
And I said, The port workers aren't working over eight hours a day.
Like, I couldn't even believe it.
Um, no, you have got to get policies that encourage people to get back to work.
The labor marticipation force is still down 1%.
That's 160 million people in the labor force, meaning 1.6 million people that have decided to just simply not go back to work.
That right there would soak up a ton of inflation with greater economic output.
Yeah, so let me play cut 17, just about inflation and printing all this money.
Let's play cut 17.
I'd love your reaction to it.
How after printing trillions of dollars, taxpayers might want to know: is there not enough money to continue fighting the pandemic?
Trillions of dollars.
You're out of it?
Is all the accounting done every single dollar?
So, we have the resources that we need in this current moment.
What we need is this funding to be able to plan for the future, to prepare for, as I say, the possibility of a new variant, the possibility of a new wave.
We don't want to be caught flat-footed.
They don't want to be caught flat-footed.
They need trillions and more dollars potentially to try to solve for the trillions they already spent.
And so, why is this the pattern of this regime, though?
Walk us through it.
Is it as if they want more spending to beget more spending?
What is their calculus here?
Yeah, I wish this was unique to only the Biden administration.
This is an embedded problem in big governmentalism.
Milton Freeman famously said that there's nothing so permanent as a temporary government program.
The same thing can be said of spending.
It's an addiction.
And then what you get with those successive deficits is downward pressure on growth.
So then they want to spend more money to offset the growth.
And this becomes a vicious cycle, Charlie.
This is what Japan's been facing for 30 years.
So we have to get to a point where we right-size government to give incentives to people in the private sector that don't have to worry constantly about interest rates, about taxes, about government spending.
We need normalcy so people can go act as humans, which is actually very vibrant and productive.
So we're kind of being gaslit where people are saying that, well, it's not because of recent spending that there's inflation.
It's all this pent-up demand from the lockdowns.
Can you talk specifically and concretely about how all these massive stimulus bills we passed, we passed four of them, totaling well over $7 trillion, how that played into what we are now experiencing as some of the worst inflation of our life?
And then, secondly, what do you think the actual inflation number is?
So I am one who believes that the worst part of the government spending bill of Biden's last plan, the $1.9 trillion that was passed in March of last year, the worst part was that it incentivized people to not go back to work.
And that added to inflation, that added to inflation pressures with the labor shortage hurting the supply side of the economy when demand was coming up.
Ultimately, big government spending, look, we've had mass, I mean, we were at 10 trillion of debt and we went to 30 trillion, and really inflation stayed very low.
Japan is the largest debt to GDP on the planet.
So this is why I want to hit home the inflation point where it needs to be improved, where they've been wrong.
But I don't want us to lose sight of the fact that an even bigger economic problem is out there, which is their debt leading to compression of growth.
That's the part that's going to hurt kids and grandkids, the next generation.
They deserve better growth opportunities into the future.
Yeah, I mean, debt is the slavery of the free in more ways than one.
So let's go into some of your other economic truths.
Name one out and let's explore it together.
Well, this concept of the knowledge problem, I quote from the great 20th century economist Friedrich Hayek, who really taught me as a very, a very young man that the government lacks the knowledge, specific time and place circumstances to do central planning well.
So there's all these good intentions out there.
And you hear, of course, in your work all the time, college kids think it sounds great to have central planning.
They talk about softening the edges of capitalism, whatever that means.
I think it can be well-intentioned, but I think what Hyatt taught us is the intentions aren't good enough because the government can't ever have the knowledge necessary to make those decisions.
So this is an economic truth, but I think so many in the right now are used to going and saying, oh, no, the government shouldn't do it.
Central planning's bad.
Socialism is bad because we can't afford it.
Well, we can afford it.
I agree.
But I would argue, even if we could afford it, it doesn't work because they don't have the knowledge or the incentives.
So I'm really trying, Charlie, to get people to, even when our criticisms are right, to get them right for the right reasons.
And that's kind of the principles we're talking about.
So, why is it the state can't have the knowledge?
Is it a limitation on their own ability, or is it just when you have 330 million people, there's no way they could have the combined intelligence of what the market could possibly demonstrate?
Yeah, that's exactly right.
And so I think that there's an incentive issue first and foremost, the skin in the game problem.
And skin in the game does not just mean that we get rewarded when things go well.
That is half of it.
But people have to hurt when things don't go well.
Moral half.
Yeah, that's right.
That's right.
And so I think that the other aspect is what Hyatt called time and place circumstances.
you with your business all of a sudden something comes up there's a crisis there's people in whatever city it's in that kind of know a specific context they know what's going on right in that immediate moment our government's trying to set policy that is universal and broad without time and place circumstance without context that is philosophically absurd but economically dangerous tease us with another one of your 250 economic truths Well, I think that one of the most important areas, I started the book.
I happen to be a man of faith.
I want people to understand that economics ultimately comes from God making man with dignity.
He made mankind in his image, which means what is God's image?
God is creative.
God is productive, innovative.
He tasked mankind.
This is the beginning of economics to go allocate resources that are scarce to deal with scarcity as productive and creative and innovative agents of him.
And I think that we lose track of the whole point of economics when we talk about it like it's a spreadsheet or a government bill in Washington, D.C. Economics is about human activity.
David is a very accomplished businessman, over $3.5 billion in assets, one of the best respected money managers out there.
And you guys should all check out his book here, No Free Lunch.
Now, I typed that in to Google and a Milton Friedman deal came up.
So I want to make sure that we get your book.
How do we make sure we get your book, David, not Milton Friedman's?
Yeah, so There's No Free Lunch, 250 Economic Truths.
It's been a bestseller at Amazon since it came out.
There's a website for the book called nofree luncheconomics.com, but it's all over Amazon.
Milton actually never wrote a book called There's No Free Lunch.
He just put it in a paper and he said it a lot.
And so, yeah, if people will use their search engine, there's no free lunch.
It's out there.
Every student in the country should have an understanding of economics.
Every politician should too.
Remember, Milton Friedman said there should be two requirements.
They should have to take an economics course and pass the economics course.
That's what Milton Friedman said for every politician in America.
You got 250 economic truths.
So you got to at least give us a couple more, Dave.
All right.
So we talked about human action as the essence of economics.
Praxeology.
Yes.
And we talked about trade-offs, which is the old title about There's No Free Lunch.
But I want to talk about incentives a little bit.
We're used to thinking of incentives as, okay, well, when I get a bonus, it means I'll work harder to get extra money.
But I don't think we understand sometimes incentives in the society.
That incentives can become structural.
We get used to them.
They're what we call norms.
Economics has really been altered by what they've done to incentives with bad policy.
People now have incentives, I mentioned before, to not work out of all the COVID stimulus.
But it even goes deeper than that.
It even goes deeper than the welfare state.
What have people been most incentivized to do, Charlie, for years with monetary policy?
Borrow money.
Interest rate being so low.
That tells you if I save money, I'm not going to get good interest.
If I borrow, it'll have a low cost.
But how do we get investment if we don't get savings?
Every dollar ever invested had to first be saved.
So savings has to lead to investment.
And of course, investment leads to productivity and more growth.
So they've undermined economic growth, right?
By taking away incentive to save.
This is a fundamental economic principle that we talk about quite a bit in the book.
Yeah, and that's we're doing the opposite right now.
There's very little to saving at all happening.
In fact, that's because of interest rates.
Do you get into that in your book, money, the price of money, and kind of what money actually is, exchange of value?
I do.
And we talk about credit.
We talk about sound money.
And I think this is an area you mentioned earlier, people not taking the inflation story seriously.
And I'll be candid, I think the right got this wrong for a long time.
There was too much kind of, you know, chicken little about inflation after the 70s.
And unfortunately, we can't label every single problem the same thing as what we had before.
Now I think people understanding better that there's no free lunch with free money either.
And there needs to be a better, more cogent policy approach to dealing with the Fed.
Yeah, I mean, money's supposed to represent value.
And right now we don't.
We print and create money out of thin air.
It doesn't really represent that at all.
So in closing, you know, what are your big messages to students and young people when it comes to economics?
No Free Lunch with Money 00:01:52
They're so brainwashed and they're just so opposite of kind of what is reality there.
What's your message?
Well, you know, as kind of an old guy who works on Wall Street now, people accuse me a lot of not having empathy for where young people are, but I got to tell you, I feel bad for people that were getting out of college around the time of the financial crisis, folks that are in between 20 and 35.
I honestly believe that what they've seen is first house prices that were collapsing.
Their parents were in all this economic distress.
And now they can't afford to buy a house themselves, even if they have a good job and have done well in their young adult life.
Student loan debt's out of control.
So I get the frustration, but I think it's misguided if they believe that more central planning will help.
Central planning is what has caused these problems with housing, with student debt.
We need a more efficient market that works for everyone, and the economy will thrive best when we focus on people that have the ability to pursue their own dreams without intervention.
Now, I understand sometimes, Charlie, people need help.
I want a robust belief for compassion, for charity.
I just don't think the government's very good at administering it.
I think the welfare state takes away their dignity.
And what I really want is us to honor this idea of all people being created in the image of God so all people can be productive in society.
That to me is the recipe for a much better environment economically and for young people to be happier and more fulfilled.
Well said.
There's no free lunch, 250 Economic Truths.
Thank you so much, Dave, for joining us.
Really enjoyed it.
Thanks for having me, Charlie.
Thank you.
Thank you so much for listening.
Email me your thoughts as alwaysfreedom at charliekirk.com.
Thanks so much.
God bless.
For more on many of these stories and news you can trust, go to CharlieKirk.com.
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