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Jan. 29, 2021 - The Michael Knowles Show

50:15

Ep. 689 - The Visible Fist Of The “Free Market”

Internet-savvy investors cost short-selling financial pros $70 billion, the establishment takes extraordinary measures to stop ordinary people from making money, and AOC demonstrates how little the Left wants unity. Learn more about your ad choices. Visit podcastchoices.com/adchoices

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	The Reddit revolt has cost short sellers, institutional investors, more than $70 billion so far this year.
	This year hasn't been going on for very long.
	This all part of the GameStop madness, the Dogecoin madness, and most importantly of all for our politics, as a result of the established platforms, the big institutions pushing back.
	We'll get into it.
	I'm Michael Knowles.
	This is the Michael Knowles Show.
	Welcome back to the show.
	My favorite comment yesterday from Kerbal Air Force, who says, I have dubbed this outsider trading.
	That's the thing.
	You know, when we talk about insider trading, we say people who have sort of secret knowledge that they shouldn't have and they make money and it's illegitimate.
	Well, there's another kind of insider trading.
	It's people who are on the inside, who are in the giant financial institutions, who are cozy with the regulators, who are cozy with the tech apps that are the broker dealers that allow you to make these trades.
	And then there are the outsiders.
	These rap scallions on Reddit and other retail investors who, when they try to use the same strategies that the institutional investors do, they get completely shut out.
	can't have those peasants making too much money at all.
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	We went into some detail on what was going on in the markets yesterday, because what's going on in the markets, more so than usual, is reflecting what's been going on in our politics, not just for the last two months, but for the last four years, five years.
	What happened yesterday is a bunch of people on Reddit gathered together.
	They saw that a big hedge fund had a massive short position on GameStop, which is not a valuable company in and of itself, but the institutional investor had this short position, meaning they were betting against the stock.
	So all these Reddit guys went in and put their money on GameStop stock and That drove the price up.
	As the price went up, the people with the short positions have to shell out more and more money.
	And the premise of these Redditors is they were willing to remain completely insane longer than the financial institutions could remain solvent.
	And this would result in them making a bunch of money.
	So it was all going according to plan.
	GameStop hit up to, I think, $460.
	There were other not very valuable companies that were also going through the roof.
	Companies like AMC, BlackBerry, Nokia.
	And then Robinhood, which is the retail investing app, stopped letting people buy the stocks.
	They just cut it off.
	You could sell.
	You were allowed to sell because selling helped all those institutional investors, but you couldn't buy.
	And so if you're an actual day trader, if you're going in and you're really banking on this to make money and it's not just some kind of frivolous thing, what Robinhood did was prevent your ability to make money and really could have cost you a lot of money too.
	Seemed totally unprecedented.
	I mean, especially because you're talking about the combination of big tech, this kind of retail investing.
	So the CEO of Robinhood goes on CNBC. CNBC anchor sitting there says, what on earth are you?
	Please tell me what's going on today.
	And the CEO didn't have a great answer.
	Explain what happened today.
	Thank you for having me on the show again, Andrew.
	So what happened today was, as you pointed out, we had to make a very difficult decision.
	It's been a challenging day.
	We made the decision in the morning to limit the buying of about 13 securities on our platform.
	So to be clear, customers could still sell those securities if they had positions in them.
	And they could also trade in the thousands of other securities on our platform.
	So it was a difficult decision, and that's what we had to do as part of normal operations.
	Hold on.
	Wait.
	Hold on there.
	I was sort of with you until the end.
	You said this was a very difficult decision, and so therefore one might imagine it was a sort of unusual position that he was in.
	And then at the end he says, but this was part of normal operations.
	Part of normal operations?
	Nothing about what happened in the markets yesterday was normal.
	And there is absolutely nothing normal about telling your customers that they can't buy the stocks they want to buy.
	And they can't buy the positions in the market that they want to buy.
	Of course not.
	Now, the word customer here is a little interesting because we all think of ourselves, if you're using a retail investing app, you think that you're the customer.
	But you're not the customer.
	You're not really paying for this sort of thing.
	The customers are the people within the financial establishment.
	And I love his excuse.
	He goes, yeah, there were 13 assets that you weren't allowed to buy positions in.
	It was very difficult.
	But you could buy positions in all the other ones.
	You know, you couldn't buy positions in the assets where you would have made money, but you could buy other stuff.
	What's the big deal?
	You could still buy positions in assets that might lose you money, just not the ones where you could have made historic gains.
	No big deal, right?
	So this, to the guy on CNBC, to his credit, this was not good enough.
	So he says, hold on, wait, what?
	Come again?
	Explain then why did you do this?
	Did the SEC call you and tell you you had to do this?
	Was there a problem inside the company in terms of liquidity, in terms of the amount of deposits that you had to put in front to the exchanges?
	What led to this?
	Sure.
	And let me explain exactly how this works.
	Oh, first of all, I want to address some of the misinformation that's been out there because there's a lot of it.
	We absolutely did not do this at the direction of any market maker or hedge fund or anyone we route to or other market participants.
	The reason we did it was because Robinhood As a brokerage firm, we have lots of financial requirements, including SEC net capital requirements and clearinghouse deposits.
	So that's money that we have to deposit at various clearinghouses.
	So some of these requirements fluctuate quite a bit based on volatility in the markets, and they can be substantial in the current environment.
	Okay, fair enough.
	So, you know, all of the kind of financial jargon aside here, what he seems to be saying is, yeah, we needed more money than we had.
	We needed more cash than we had on hand.
	So, you know, we had to shut this down.
	But then the interviewer goes on, he says, so this is a liquidity issue, right?
	This is just an issue.
	You didn't have enough cash.
	And the CEO of Robinhood says, no, no, it wasn't a liquidity issue.
	No, it's all good.
	It's all good.
	It's not that.
	But we definitely didn't do it at the behest of any institutional investors or hedge funds or market makers or people.
	It was just normal operations.
	And that's why it was such a difficult decision.
	Not very convincing.
	I don't know anything about the inner workings of Robin Hood, and I don't know very much about the financial services industry either.
	But I know that that answer did not convince the guy on CNBC, and I don't think it convinced anyone else either.
	This seems rigged.
	It just seems rigged.
	It is something that I think has been a long time coming for people in politics.
	Because while I'm getting a great deal of enjoyment out of the craziness of the markets and how funny this is and all the memes and everything, there's a new one.
	They actually now are running up the price of something called Dogecoin, which is just a meme.
	It's like a fake cryptocurrency and they ran that price up and now I think you're not even allowed to buy that now.
	All of this manipulation of the markets...
	This is, forgetting for a second the stocks themselves and the assets themselves, the right has needed a reckoning on this for some time.
	We on the right love markets.
	We love free markets.
	We think free markets are a wonderful tool for human flourishing.
	Totally.
	Some people on the right, however, have made an idol out of free markets.
	A free market is not merely an instrument to their broader political ends.
	The market has become the end in and of itself.
	And that is ridiculous and sophomoric, but also just deeply, deeply wrong.
	Because, and we've had this conversation with regard to speech, we'll have it now with regard to markets.
	There is no such thing as a perfectly free market.
	Just like there's no such thing as perfectly free speech, there are always limits on it, whether it's limits on fraud, or limits on threats, or limits on sedition, or limits on obscenity, or limits on this, that, or the other thing, which have always existed in every single society and always will.
	There is no such thing as the perfectly free market.
	There are constraints on the market.
	You saw this yesterday.
	Sometimes we like to use the phrase of Adam Smith.
	We talk about the invisible hand of the free market, which to me is sort of magical thinking.
	And there's some use of that image, but it's not a religious fact.
	And I think people have turned it into a religious idol.
	Yesterday, we did not see the invisible hand of the free market.
	We saw the visible fist of a rather unfree market.
	Now, I pointed this out, and someone actually had the audacity to say yesterday.
	They responded, they said, the free market part, Michael, is that you don't need to use Robinhood.
	You don't need to use Robinhood, eh?
	So what you're really telling me is build your own broker dealer.
	You just got through telling me, you just got through telling me that if I don't like Twitter, I can build my own Twitter.
	Then we did build our own Twitter.
	It was called Parler.
	And then they shut that one down too.
	They kicked it out of the app stores.
	Then when that didn't work to totally kill it, they kicked it off of its web services.
	Whoopsie daisy, build your own web services, build your own app store, build your own iPhone, build your own domain registrar.
	Build your own internet.
	Build your own society.
	That's what they're saying here.
	Build your own broker dealer.
	Build your own stock exchange.
	Build your own securities and exchange commission.
	Build your own government.
	That's what we're trying to do, guys.
	That's what we're trying to do.
	And the way you do that is you engage in politics.
	But for so long, the market idolaters...
	The people with this extreme, I don't even want to call it a libertarian view because it's unfair to libertarians, but this kind of shallow, ridiculous talking point view from the 90s and 2000s that conservatives can never, ever exert political power that the people give us because it would disturb my wonderful, cherished free market or something, and therefore we need to just do nothing.
	The only kind of politics we can have is negative.
	Well, where did that get us?
	Where did that get us?
	Now, even those very fundamentalists are saying, yeah, build your own government.
	I fully intend to do that.
	I fully intend to get political power in this country through political means and get the people to elect good candidates and then to exert that kind of political power against the rigged system that we are seeing.
	We've seen it just in the last couple days in the markets, but we've seen it much more broadly over the past decades.
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	This Robin Hood CEO who was shutting people out of making investments yesterday...
	But only specific investments where they could have made a lot of money.
	He is being sued, as of course he should be.
	There is at least one class action against him.
	There's probably going to be multiple.
	Maybe they'll all converge.
	Brandon Nelson, who's a retail investor from Massachusetts, filed a suit in the Southern District of New York, claiming that the company violated, quote, the implied covenant of good faith and fair dealing with its customers when it restricted them from making transactions on high-yield assets.
	Quote, on or about January 27th, Robinhood, in order to slow the growth of GameStop and deprived Their customers have the ability to use their service abruptly, purposefully, willfully, and knowingly pulled GameStop from their app, meaning retail investors could no longer buy or even search for GameStop on Robinhood's app.
	Good.
	I'm glad.
	I think this guy probably committed serious crimes, not even just a breach of contract for the users of Robinhood.
	It seems like these were pretty serious financial crimes that were committed yesterday.
	That kind of market manipulation is absurd.
	Whether or not he'll be held to account for this, I don't know.
	Because it just seems like a rigged game, right?
	So it seems like some people are held to different standards than others.
	This is why I don't believe...
	This whole GameStop, Dogecoin, AMC market thing.
	I don't think it's rich versus poor.
	I know there were some conservative commentators yesterday who were afraid that we were delving into a kind of rich versus poor, 99% versus 1% kind of almost leftist sounding dialogue about this.
	I don't think it's rich versus poor.
	First of all, I don't think these Redditors who drove the stock prices way up, I don't think they're poor.
	I think they're very intelligent, obviously.
	They are fairly sophisticated.
	They know how to search for these kind of positions that institutional investors have.
	They are smart enough to realize if someone's got a huge short position and you can gather a million people or two million people to go in and pump up this asset, then you're going to create a short squeeze.
	And if you hold on long enough, then the asset's going to go up unless there's market manipulation from the outside.
	All of this to say, these are not idiots.
	All right.
	And one aspect of Reddit and Twitter and social media that makes it difficult to speak about this in a sort of scientific, data-driven, statistical way is people have anonymous accounts, right?
	So you can't know that much about these people if you're just trying to analyze it from the outside.
	But in my own experience, the plural of anecdote will have to be data here.
	In my own experience, The people I know who spend a lot of time on Reddit or Twitter and who have anonymous accounts are very smart and they're not living in their mom's basement and they're not waiting to eat the chicken tendies or whatever the memes say that they are.
	They're pretty urbane people, many of whom have kind of normal jobs, who go to normal cocktail parties, who have a kind of sophisticated, yuppie-ish way of living, but who just realize how corrupt this system is.
	It's the same view I was describing yesterday on the show.
	When we said, is it about elitism or populism?
	I said, when we have a good elite, I'm an elitist.
	When we have a corrupt elite, I'm a populist.
	Of course, I want to be governed by good, wise, serious, virtuous people.
	Elites could be that.
	And in that case, works for me.
	But when the elites are not that, then I'm with Buckley when he says that I'd rather be governed by the first 2,000 people in the Boston phone book than the faculty of Harvard College.
	Bill Buckley was the same way.
	He was an elitist of sorts, except when the elite was totally decayed and degraded and debased.
	That's what I think this is about.
	I think this is about an establishment of That comprises people who, of all different looks, of all different backgrounds, of all different economic levels, you know, socioeconomic levels.
	But some people are in, some people are out.
	It was funny too, because yesterday, a bunch of sort of socialists tried to jump on the bandwagon and say, oh yes, we're really showing it.
	We're showing it to this Wall Street folks.
	Now, the people on Reddit They were not socialists.
	They were not Antifa.
	They were not the DSA. They were the kinds of people who voted for Donald Trump.
	And what the left believes is that's just neo-Nazis and white supremacists or something.
	But it's not.
	It's not.
	It's people of all levels of education and all levels of everything else who realize that something about this system is rigged.
	I know you're not allowed to use that word when you discuss elections or when you discuss the administrative state or when you discuss the financial establishment, but it just looks rigged.
	I'll give you an example of this different set of rules for the liberal elite.
	We talked yesterday briefly on the show about how some dude on Twitter, I think he's 34 years old, so at the time he was in his 30s somewhere, I think at the time he was in his 20s, During 2015-2016, he had an anonymous Twitter account, which was Ricky Vaughn, and it was very politically incorrect and very offensive, and he would say all these mean things.
	He was just posting memes and everything.
	He might go to prison for 10 years, because he posted a meme which said, hey, if you're a Democrat, text your vote to this number, and you can text your vote, and then you don't need to worry about voting.
	And it's an old joke.
	People have done it for years.
	It's the same joke as saying, if you're a Republican, vote Tuesday.
	If you're a Democrat, vote Thursday, right?
	And then you miss the vote.
	They're threatening him with 10 years in prison for posting that meme.
	Meanwhile, a blue checkmark on Twitter, someone with the establishment seal, right?
	Somehow, some of us conservatives still have kept it for now.
	I still have my blue checkmark.
	Probably, maybe not after this episode, I will.
	This woman, Christina Wong, who's some comedian, got the blue check.
	She posts the same exact joke.
	Hey everybody, this is Christina Wong.
	And I'm coming out.
	I'm a Trump supporter.
	And I just want to remind all my fellow Chinese Americans for Trump, people of color for Trump, to vote.
	Vote for Trump on Wednesday, November 9th.
	Really important day.
	We're going to show this country who's boss.
	And that's our man, Donald Trump.
	So don't forget to vote Donald Trump on November 9th.
	Old joke, right?
	Vote for Trump the day after the election.
	I've made this joke.
	I was actually kicked off of Facebook for 24 hours on election day for making this joke five years ago.
	Four years ago.
	She also, in her tweet about this, wrote, text your vote to whatever.
	The exact same thing as Ricky Vaughn.
	She's still on Twitter.
	She's still out of prison.
	She's not being investigated because she's a liberal.
	She did 100% exactly the same thing as the guy behind Ricky Vaughn.
	But Ricky Vaughn is going to go to the can because there's a different set of rules for the liberal elite.
	John Kerry, climate czar under President Biden, telling coal workers, oil workers, natural gas workers that they are not going to have their jobs.
	Biden lied to them.
	Whoopsie-daisy, too bad.
	We've got a climate crisis.
	Learn to make solar turbines.
	Wind turbines.
	Learn to code.
	Right, that's...
	Broadly, what the liberal establishment tells ordinary Americans when they get rid of their jobs.
	John Kerry owns a private jet.
	His family owns a private jet.
	John Kerry gets to fly all around the world however he wants.
	He gets to use a whole lot more in terms of natural resources, in terms of energy.
	He gets to pollute a lot more than anybody.
	It doesn't matter because he's going to stop you from polluting.
	And really, isn't that the whole point?
	Same could be said of Al Gore, uses so much more in the way of natural resources, Leo DiCaprio, all the prominent environmentalists.
	One set of rules for them, one set of rules for you.
	In a way, I'm glad to see what happened.
	Yesterday.
	It's too bad because some people lost a lot of money because Robinhood, and it wasn't just Robinhood, by the way, when they say use a different broker dealer, basically all of the broker dealers shut out the ability to buy positions in GameStop or AMC or all of these assets.
	So you couldn't do it.
	And I'm sorry that people lost money because of this sort of thing, but I am glad to see it.
	I think we now know what we're dealing with.
	All this talk, all this silly talk that Republicans even had duped themselves into believing.
	We have a perfectly free market.
	Defend the hedge funds at all costs.
	The glorious, wonderful hedge funds.
	Wall Street gives money to Democrats.
	Gives a lot of money to Democrats.
	By many measures, they give most of their money to Democrats.
	Why am I supposed to defend these guys?
	Hedge fund analysts are some of my best friends.
	I actually have a number of friends who are hedge fund analysts.
	I don't think there's anything special about hedge fund analysts as a class or hedge fund managers as a class.
	It means I need to defend them.
	If they do good things, that's good.
	I'll defend them.
	If they do bad things, I won't.
	And if they support liberal candidates and even liberal Republicans when they do support a Republican, why do I need to defend them?
	Why do we need to carry water for people who hate us, who hate our views, who won't let us participate in society, and who have no particular loyalty to our country or our traditions?
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	I have a play for you in three acts.
	This tells you a lot about the situation that conservatives find themselves in in the country.
	Yesterday, AOC tweets out about the whole GameStop thing and the markets and everything.
	She tweets out, quote, This is unacceptable.
	We need to know more about Robinhood's decision to block retail investors from purchasing stock while hedge funds are freely able to trade the stock as they see fit.
	As a member of the Financial Services Committee, I'd support a hearing if necessary.
	So I read that and I say, wow, I have common ground with AOC. Okay.
	Works for me.
	Ted Cruz, our pal, you know, Senator Cruz, who we'll be talking with on verdict very shortly, probably about this.
	He responds, he says, fully agree.
	AOC responds, quote, I'm happy to work with Republicans on this issue where there's common ground, but you almost had me murdered three weeks ago, so you can sit this one out.
	Happy to work with almost any other GOP that aren't trying to get me killed.
	In the meantime, if you want to help, you can resign.
	I give Senator Cruz a lot of credit for engaging in good faith, trying to reach out to somebody like AOC, find some common ground.
	They're not interested.
	They're not interested.
	Clearly.
	I'm glad he tried.
	I'm glad he tried.
	Shows that we are trying and they are not.
	But now we've learned a lesson there too.
	First of all, I like how AOC says, well, I'm willing to work with any Republican, but not Ted Cruz.
	And not Donald Trump.
	And not this one.
	And not that one.
	And no Republican.
	She doesn't think any Republican is legitimate.
	He almost had me killed.
	What?
	What is your evidence for that?
	Oh, of course you don't have any.
	Doesn't matter.
	They hate us on the left.
	They have been saying for months now that we are all Nazis and white supremacists.
	Who should be kicked off of Twitter?
	Who should be kicked out of our jobs?
	Who should be kicked out of our schools?
	Who should be kicked off of our investing apps?
	Who should be kicked out of our banks?
	Who should be ostracized utterly from society?
	And conservatives, we do this thing where we try to win their respect.
	We're not going to.
	We try to do this thing where we try to prove we're not racist.
	We're not going to.
	It's not going to work.
	AOC is going to do what AOC wants to do.
	The left is going to do what the left wants to do.
	They are not going to try to work with Republicans in any way.
	They are going to follow the science, the science of progressivism.
	Dr.
	Fauci, what a wonderful guy.
	Dr.
	Fauci, our true leader, he just came out.
	He said, if you get the vaccine, which you soon will probably have to do, if you get the vaccine, that's not a free pass to travel.
	It is not a good idea to travel, period.
	I mean, if you absolutely have to travel and it's essential, then obviously one would have to do that.
	But we don't want people to think because they got vaccinated, then other public health recommendations just don't apply.
	One of the biggest things that are really not well understood is people ask, Why should I even have to wear a mask after I get my second shot?
	And the reason is very clear that the primary endpoint of the vaccine trial was clinically apparent infection.
	So you could conceivably get infected Get no symptoms and still have virus in your nasopharynx, which means that you would have to wear a mask to prevent you from infecting someone else, as well as the other side of the coin where you may not be totally protected yourself.
	So getting vaccinated does not say now I have a free pass to travel.
	Yeah, look, just because you do all the stuff that we're telling you to do, even though sometimes it contradicts our previous advice day by day, just because you do that doesn't mean you have a free pass to travel.
	You know, travel, what all of us in the establishment have often called a human right, travel, a constitutional right that you have to move freely.
	Yeah, you don't have a free pass to do that anymore because of science.
	Joe Biden made this point the other day.
	He tweeted out, science will always guide my administration.
	He capitalized administration in a weird way.
	You know, they always made fun of Trump for weird capitalizations.
	He does that too.
	He probably intentionally would capitalize science though, even if it didn't begin a sentence, because he's referring to science as a sort of God.
	Science will guide my administration.
	What he means by science here obviously is not what we think of as a science.
	The system of material inquiry and empiricism and observation to lead us to new knowledge about the physical world.
	He's not referring to that.
	I mean, they've contradicted themselves sometimes by the hour.
	He's referring to science in a political way, which the left has done for years and years, in the same way that Marx would refer to science and Marxists would refer to the science of politics or the science of history.
	The new left would refer to these sorts of terms in the mid-20th century.
	This is why AOC is not going to work with Ted Cruz and not going to work with any other Republican.
	They are on the right side of history.
	They know the science of history.
	They know the science of politics.
	And for the uninitiated, those sorts of unwashed people can be of no help.
	You just gotta get rid of them.
	AOC is gonna be fine on her own.
	You know, we on the right, we often...
	Point out the hypocrisy of the left.
	That's probably what we spend most of our time doing.
	So much for the tolerant left, so much for healing and unity, so much for this, so much for that, as though in this sort of innocent, naive hope, we think that one day the left is going to realize, oh my goodness, we're not being tolerant.
	You're right.
	Oh my goodness, we're not being particularly unifying, not trying to heal the country.
	They know.
	They know that.
	They don't want to tolerate us.
	They've written essays, famous essays called Repressive Tolerance, for instance, about why they don't want to tolerate us.
	They don't want to unite with us.
	They want to heal the country by getting rid of us, by ostracizing us.
	And they're doing a good job of it.
	And because we're so afraid of ever using political power, They succeed even when we win.
	Even when Republicans win elections.
	Even when we had unified government from 2017 to 2019.
	What did we do?
	What did we do as a matter of real sweeping legislative change?
	We passed a tax cut.
	Because we are beholden to a shallow, silly idea that That pretty much just became the boilerplate conservative talking point in the 90s and 2000s, that we can never exercise political power.
	We have to respect the free market.
	We need to live in holy fear of the free market.
	What free market?
	What free market?
	Market doesn't look very free to me.
	We can never suggest that the left moderate their language, moderate their behavior, because of free speech, the idol of free speech.
	What free speech?
	I don't see free speech.
	Doesn't look very free from my vantage.
	Looks like it's full of a censorship regime from the left.
	And even when we look back further, before, say, the 60s and into maybe the 50s or the 40s, even then when conservatives had much, much better hold on the culture, We had a free speech regime in the American tradition of free speech.
	We also had McCarthyism.
	We had tough laws against obscenity.
	We had all sorts of rules about speech.
	We had just a different set of standards.
	We had the traditional conservative standards.
	We've convinced ourselves to abandon that.
	We've convinced ourselves to abandon financial standards because of a shallow ideology that ironically the left foisted on us.
	During the mid-20th century to convince us to stop exercising power.
	And so we appear to be impotent.
	And the game appears to be rigged.
	We started to wake up to that in 2016.
	How much longer is it going to take before we realize the real nature of this system, the real nature of our elites, and for us to begin to exercise our political power to push back?
	One way we do that in the culture is by releasing our movies.
	We just had our first movie come out here at the Daily Wire, Run Hide Fight.
	It's exclusive for Daily Wire members.
	The elite critics hate it.
	They gave it like a 2% or something on Rotten Tomatoes.
	The audience loves it.
	They gave it a 93% with thousands of reviews.
	You can watch Run, hide, fight on streaming apps at Apple TV, Roku.
	If you're not a Daily Wire member, use promo code RHF to get 25% off.
	That is RHF for 25% off.
	Now, my favorite time of the week, we get to the mailbag from Matt.
	Michael, with President Biden's first 100 hours under his belt, who would you say is the worst president of the United States?
	Joe Biden, FDR, or Woodrow Wilson?
	Woodrow Wilson is the worst because he was the smartest about it.
	Woodrow Wilson understood what he was doing.
	You can read, I think the essay is called, What is Progress?
	Something like that.
	What is Progress?
	I think it's what is progress.
	And Woodrow Wilson lays it all out.
	He says, look, I'm a political scientist.
	I'm taking these ideas that came to us from Europe, and they're very recent ideas, and And I've been working on them in the academy, and I'm going to use those ideas to overturn the old constitutional system, which is now outdated, and it's according to an old theory of science.
	The old theory of science was Newton, fixed laws to the universe.
	I'm going to replace it with the new Darwinian theory of science, which is evolution.
	There's no such thing as fixed permanent laws.
	There's no such thing as fixed permanent human nature on which our constitutional system was based.
	So we're going to have a new administrative state.
	We're going to take the political power away from people, And give it to these experts, these genius elites who are going to govern us and we're going to have a wonderful country that way.
	Now, FDR in many ways implemented the Wilson plan, but Wilson was the kind of mad genius behind it and the cause of many, many problems.
	From Alex, Dear Michael, I am a student at the University of Florida.
	I live on campus in the dorms.
	It is current university policy that unless I am in my room showering, brushing my teeth, or eating, I have to wear a mask at all times.
	I've not been following these rules up to this point, and no one has said anything to me.
	This all changed today when my floor RA sent out a group message saying that some of the residents had not been following the guidelines and that he was going to start being really strict and issuing reports on violators.
	As I am the only one on the floor who I have ever seen not wearing a mask, I assume this is directed at me.
	Should I just shut up and wear the mask?
	Or is there a way to continue my protest without risking my housing contract?
	Yeah, you seem to be in the position that conservatives find themselves in.
	So the sort of aspirational advice I'll give you is say, you know, take that mask off and stand up.
	But you'll probably lose your housing if you do that.
	So if you're willing to do that, fine.
	You live off campus or something.
	But the political reality that you're in is you have no leverage.
	You have no leverage because the school is, well, it's obviously run by the state government.
	So if the good guys don't run the state government, you're in trouble.
	Now, we do it.
	Ron DeSantis is down there.
	That's pretty good.
	But the blob, the bureaucracy of that state, I presume is not quite as conservative as Governor DeSantis.
	We have lost control more broadly over education.
	That's been given away.
	We've lost control over the narrative on the masks and the virus.
	That's been given away.
	We don't have a way to exercise power.
	And because of that, you're vulnerable.
	So probably what you got to do, it's the same thing when I go on an airplane.
	All I want to do is rip off that stupid mask.
	I will be put on the no-fly list.
	I won't be able to fly anywhere.
	So I hate wearing the stupid mask.
	I never wear it, practically, when I'm out and about in my daily life.
	But when I'm on the airplane, because we don't have any power, they force us to.
	You've got to be wise as a serpent, innocent as a dove, right?
	You've got to be clever.
	And beyond that, you've got to amass some power and influence and be able to use it.
	We're in a position right now where you probably can't do that, but it's worth...
	As you form your political views, which happens especially in college, it's worth remembering this situation and taking some lessons from it.
	From Matthew, Michael, do you think there will be any politicians switching from Democrat to Republican in the next year or two prior to 2022?
	It seems that Tulsi Gabbard is making the rounds on Fox, not that Fox is entirely conservative anymore, and Joe Manchin seems to not completely fall in line with his fellow leftists with ending the filibuster.
	It's the sign of a red wave.
	I don't know.
	I mean, Tulsi's been saying some good things.
	And Joe Manchin's always been a little more moderate anyway.
	Usually not when it counts, but at least in the way he talks.
	What it's a sign of is that these people know their constituents.
	Tulsi Gabbard knows that the people who are listening to her are common sense people.
	They're not uniformly Republican or conservative by any means, but they're not buying into the kind of established liberal secular religion.
	I guess the same would go for Joe Manchin.
	West Virginia, you can't be AOC. AOC is not getting elected to anything in West Virginia.
	So that's good.
	But, I don't know, maybe they'll switch parties.
	Probably Joe Manchin won't.
	Maybe Tulsi Gabbard will.
	However, I don't even think that what we're looking at over the next few years is about that.
	I don't think it's about new people registering or whatever.
	There's going to be a permanent wall around the Capitol.
	You know, it's so funny that the left calls us all fascists, and yet they wouldn't invite any of the people to their inauguration for the president who supposedly got the most votes of any president in human history, that they now have a standing army in Washington, D.C. to keep the people away from them.
	It's a little weird, isn't it?
	They've now taken away election integrity measures, notably in Pennsylvania, where they had to violate the state constitution to do it, but Virtually everywhere else, too.
	Now we have unsolicited widespread mail-ins.
	We now have election month instead of election day.
	No voter ID measures in a lot of places.
	So, sure, I hope Democrats become Republicans, but Republicans don't have any sway.
	We don't have any power.
	So, it doesn't matter if 90% of the country becomes Republicans.
	If we can't rely on election integrity measures, Still going to be a big uphill battle.
	From Alex.
	In your last two shows, you mentioned that the family is the fundamental social building block.
	However, I thought that the virtuous individual was intended to be the fundamental building block of a successful society.
	For example, our justice system is intended to operate on individuals.
	Our economy is based on the principle of mutually consenting transactions between individuals, to a degree.
	Success in various hierarchies such as career, church positions, and even dating is intended to be based on individual competency and merit.
	Could you please clarify how these ideas are consistent with your claim about the family?
	I realize this may be a which came first, the chicken or the egg type question.
	Sure, I mean, some of these assertions that you're making, I think, are somewhat dubious.
	I appreciate the zeal with which you're asserting them, but you're not providing a lot of evidence.
	And obviously, you don't have a ton of room to do that in a mailbag question.
	But I think there are many of these sorts of things that we're so used to asserting as talking points.
	But perhaps when we think about them, it's difficult to explain how.
	The reason that we have this idea that the individual is the fundamental unit of society and that maximizing individual autonomy is the be-all and end-all of society is because we've been fed a bunch of lies, mostly by the left, actually, over the last half century.
	But that view is not the traditional American view.
	Obviously, good old individual effort and gumption is very important and nobody denies that.
	But that's not what I'm talking about.
	What I'm talking about is a sort of anthropology.
	What I'm talking about is where does society come from?
	When we craft societies, societies develop.
	Do they develop out of atomized individuals who spring into existence from the thin air and then drop down in the middle of a forest and sort of educate themselves on their own and come to their own ideas on their own?
	Maybe they're inbred ideas.
	And then they walk up to one another and they say, okay, we're all total individuals and we're going to form a society on a social compact and we all agree to it by mutual consent and that's it.
	Is that how society is formed?
	No.
	And then what happens for the next generation?
	Do they pop out of thin air too?
	No, that isn't.
	What happens is we're born through no decision of our own.
	We're born into a family and into a society, a community, and into a broader society.
	and we are educated in that society and specifically by that family.
	We take on the customs and traditions and views of that society, and we contribute to it because we are individuals and we do have free will, but the social conditions also shape our desires, also shape our will, form our habits, which also shape our will, form our habits, which are the virtues, right?
	Virtues are habits.
	They're not just things we arrive at through thin air, out of thin air, through our own reason alone.
	And as a result, these institutions really, really matter.
	That's how things happen in real life.
	Now I understand in philosophy class, particularly if you're talking about liberal philosophy class, things happen differently.
	But there is some utility to that when we're thinking through our politics.
	But I think we've gone so far in that fantasy ideological direction.
	We're not looking at the way things actually work in front of us.
	And this all redounds to the left's benefit.
	Because the left is always trying to destroy these institutions, to destroy the family.
	Because when you're talking about a leftist revolutionary political movement going up against traditional, ordered, settled society with lots of different subsidiary institutions at every level down to the family all the way up to national institutions...
	It's very difficult for the revolutionary movement to come in and overturn all of that.
	It's just the society is so strong.
	But when the revolutionary movement comes in, and all those mediating institutions have been destroyed, and it's just a bunch of disconnected individuals who are extraordinarily skeptical of one another, distrustful of one another, who have nothing in common, it's much, much easier to take over.
	And that's what the left is banking on.
	And that's what I'm trying to say when I'm describing this dichotomy between the family and the individual as the basic unit.
	From Hayden.
	Dear Mr.
	Knowles, I agree that the $20 bill should be left alone, but you said something that piqued my interest.
	Someone said to you that Jackson should be disqualified due to the Trail of Tears, to which you said Martin Van Buren should be kept off our currency.
	In school, we were taught that Jackson is to blame.
	What do you believe is to blame for the Trail of Tears?
	Well, it just happened on Van Buren's watch.
	So it's just chronologically, it doesn't work to blame it all on Jackson.
	The reason they blame Jackson and the reason that they They, you know, don't like him and they castigate him and they find him to be an easy target.
	It's because he did embrace a policy of Indian removal.
	He fought in the Indian wars.
	Let's not forget, the way that Europeans got this territory is in part by forming alliances with Indian groups like the Pilgrims did.
	It was in part through trade, purchasing land, fair and square, and it was in part through war.
	By the way, the way that various Indian groups got territory is by going to war with other Indian groups.
	By the way, the way that people get land throughout history often is through war or through trade.
	It's all the ways that we did here.
	But because the left hates this country...
	The left goes in and says, the land was the Indians.
	Any way that we got it was illegitimate.
	And Andrew Jackson was clear about this.
	And the fact that Andrew Jackson even supported a policy that would remove some Indians from the American land and put them in different land is reason enough to erase him from our memory.
	Now, the question that naturally follows when someone says that we need to give the land back to the Indians is which Indians?
	Do we give them to the Comanche?
	I guess we took land from the Comanche, but maybe we should give it back to the Apache because the Comanche took the land from the Apache.
	Are we going to give land, our interests in Latin America, are we going to give it back to the Aztecs?
	Are we going to give it back to the people that the Aztecs conquered?
	Is there even a way to distinguish at this point after all these years?
	Probably, probably not.
	Next question from Jaden before I have to go.
	Michael, what is your opinion on evolution?
	Matt Walsh said he believes in it, but I've never heard what you think.
	Thanks.
	I don't think about it very much.
	I don't really care.
	It's not a...
	You know, I just...
	I don't care that much about various other niche fields of physical science.
	There seem to be some problems with Darwin.
	This was well laid out by David Berlinski.
	David Galerter, a genius computer scientist, said that the problems with Darwin, he found them to be sort of, Darwin's theories to be mathematically impossible, so he's moved away from them.
	But I don't know.
	I'm just not expert enough in Darwin or Lamarck, who has had something of a resurgence, I guess, through neo-Lamarckism and epigenetics.
	It's all interesting enough to me.
	I'm open-minded about it, but it doesn't particularly affect my view of the world.
	All right.
	That's the show.
	I'll see you next week.
	I'm Michael Knowles.
	This is The Michael Knowles Show.
	The Michael Knowles Show.
	Also, be sure to check out the other Daily Wire podcasts, including The Ben Shapiro Show, The Andrew Klavan Show, and The Matt Walsh Show.
	The Michael Knowles Show is produced by Ben Davies, executive producer Jeremy Boring, our technical director is Austin Stevens, supervising producers Mathis Glover and Robert Sterling, production manager Pavel Vidovsky, editor and associate producer Danny D'Amico, audio mixer Mike Coromina, hair and makeup by Nika Geneva, and production coordinator McKenna Waters.
	The Michael Knowles Show is a Daily Wire production, copyright Daily Wire 2021.
	Hey everybody, this is Andrew Klavan, host of The Andrew Klavan Show.
	You know, some people are depressed because the republic is collapsing, the end of days is approaching, and the moon's turned to blood.
	But on The Andrew Klavan Show, that's where the fun just gets started.

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