2147 Global Warming vs Reality, Republicans vs Democrats: Stefan Molyneux Hosts the Peter Schiff Radio Show
Stefan Molyneux, host of Freedomain Radio, takes the helm of the Peter Schiff radio show, with special guest David Evans - Perth-based mathematician, engineer and founder of GoldNerds -- on why he converted from global warming alarmism to skepticism, and a few Australian gold companies worth keeping an eye on. Also, why we should be turning to philosophers rather than politicians, and why there really isn't a dime's worth of difference between the Republicans and the Democrats.
It's Devan Molyneux in for Peter Schiff on the Schiff, Peter Schiff Radio Show.
I hope you're doing fantastically this morning.
This morning, as usual, as per last time, we are going to be talking about philosophy.
Why?
Because that's my thing, man.
That's my gig.
I run Free Domain Radio, the largest philosophy show in the world.
And I'm going to make a case.
We're going to talk a little bit about...
Budget challenges facing the US, budget challenges facing the European Economic Union, which is far from a union.
In fact, it seems to be bitterly opposed, and it's interesting and fascinating to see what a progress Europe is making, that they're only throwing insults across the country lines rather than panzers and bombs.
And coming up on the half hour, we're going to get David Evans in.
He is a guy you really want to listen to.
He is a genius of science.
He's the co-founder of goldnerds.com, a Perth-based mathematician and engineer.
And he will be talking to us...
About global warming or the lack thereof and the lack of scientific justification thereof.
But why should we care about global warming?
After all, the U.S. has only spent about 74 billion with a B dollars on combating global warming since 2008.
So let's make the case for...
Philosophy in the current mix of the world.
It's always struck me as particularly sad that philosophers aren't really invited much to discuss current events.
You know, you turn on the TV, you'll see your economists, you'll see your generic pundits, you'll see a couple of academics here and there.
But there's very few people, in fact I can't ever remember having seen it, very few people who will say, You know what we really need?
We've got to get us a philosopher here, because what we're dealing with is a crisis of thinking, a crisis of reason, a crisis of accurately interpreting evidence, a crisis, dare I say it, I dare, I dare say it, a crisis of morality, of ethics.
That is the real problem that is facing the world.
The violation of the two basic ethical principles that all reasonable people accept, at least in their personal lives.
Numero uno, the non-aggression principle.
Thou shalt not initiate force against thy fellow carbon-based lifeform At least the bipedal ones with the big frontal lobes.
And number two, thou shalt not steal violations of property rights.
And if you look, and we'll talk about this in the show, if you look at the issues facing the world, they can all be traced back.
The major political, economic issues facing the world, they can all be traced back to violations of persons and or property.
The initiation of force, fraud, and theft.
But we have a whole group of people who aren't particularly...
Good at dealing with these issues.
Unfortunately, they've always been put in charge.
So here's a couple of things that philosophers are good at that other particular interested parties are not.
Philosophers are really good at not being liked.
I think that's a really important thing.
In order to solve the problems of the world today, Given that we're in such a budget deficit that it's a zero-sum game, whoever you cut is going to lose, whoever you fund is going to win.
There's really not a whole lot of money left, or imaginary paper money left, rolling off the printing presses to bribe everyone to their satisfaction, so there's going to be some losers in the current budget negotiations and in the future.
Those losers, of course, are going to rouse the primitive mob of the media to howl insults and hurl insults down from the mountaintop on anyone who dares cut any funding about anything.
Just look at poor Scott Walker in Wisconsin for that, where you've got riots and violence occurring because, well, public servants are being asked to pay a little bit more towards the benefits that they're pretty much stealing from future generations at the moment.
Philosophers are pretty good at not being liked.
We have a long and noble tradition of being extremely disliked by large sections of society because there is great profit in lies, there is great profit in falsehood, there is great profit in propaganda and deception, which is why so many of governments and other resources in the world are devoted to these ends.
Philosophers come along with some pretty good rules of thumb, some pretty simple tests for things that are good, for things that are true, for things that are right, for things that are accurate, for things that are verifiable, and this hurls great tidal waves of truth at the petty and trembling sandcastles of falsehoods that so much of the world's wealth is built on.
Philosophy comes along and very much blows away the moral justifications for fiat currency, because philosophers will simply point out that if making up your own money, if printing your own money, if creating your own currency is counterfeiting, or creating a currency to mimic a real currency is counterfeiting, Why then the Federal Reserve is a counterfeiter?
It's a very, very simple thing.
Philosophers come along and say, hmm, if the initiation of force to remove property unwillingly from another is theft, well, let's examine the concept of taxation, shall we, and see how that works.
If I cannot be entered into a contract involuntarily against my will, Why then I don't see how a social contract could apply to me?
If I cannot sell off the future productivity of my children in return for bribing my friends in the here and now, why then I don't really see how a national debt can be passed along intergenerationally?
So philosophers come along with simple, annoying, obvious, conscience-provoking questions, observations, conclusions, and I think the better the philosopher, the simpler is the communication about these things.
And this causes a significant amount of reaction around the world, and philosophers, if they are wise, know that this reaction is going to occur.
If you compare and contrast this to politicians, well, politicians of course get where they are, Because they are good at being liked.
And they want to be liked.
They like to be liked.
And to ask a politician to get to the very summit of his or her profession based upon the capacity to be liked, the capacity to evoke the likeness of another, and then saying, well, now you've got to reverse it all.
You've got to reverse it all, and now you've got to cause enormous groups of people to dislike you.
Well, that seems like a rather tricky...
thing to ask for anyone who's devoted that much time and has that much charisma.
And so, in a sense, it's trying to turn Darth Vader back to the path of goodness and light and virtue to say to someone like Obama, who is really the Darth Vader of public speaking, ah, if only he could use that power for good, for good, but I shall not hold my breath, to ask him to Now turn around and provoke significant dislike from people is, I think, really to ask the impossible.
To ask for somebody to reverse his entire skill set, his entire life's work, and to attempt to get someone to bring into being capacities within themselves that they've spent their entire life not developing.
It's like suddenly expecting me to be either a hair model, a gymnast, or Somebody who models underwear with not so much a six-pack but more of a middle-aged keg.
So I don't really think that we're going to get much answers from politicians.
I don't think that we're going to rely on the charisma of economists.
So I think that we really do have to start looking towards philosophy.
That's a little bit where I come in.
We're going to talk a little bit more about this and start discussing some of the rather interesting details of fiscal year 2013 U.S. budget, Euro crisis, global warming, calls.
We've got it all coming up.
Please stay tuned.
This is Stefan Molyneux for the Peter Schiff Radio Show.
Hello, everybody.
It's Stefan Waller from Free Domain Radio, back once more for the Peter Schiff Radio Show.
Hope you're doing very well.
So we're talking about how you really can't go to politicians to tell people things that are unpopular.
Politicians rise to prominence and power because they are very good at being liked.
And being good at being liked is not a bad thing when you're dealing with someone who's rational, who's intelligent, who's learned, or at least has some basic common sense.
But that's not the world that we live in.
We live in a world of people who've been propagandized, miseducated, and stuffed full of all kinds of nonsense through government schools.
So, when you are trying to appease a mindless mob, you have to tell them what they want to hear, which is really quite the opposite of the truth.
A philosopher will come up and tell you the truth, and will not, hopefully not, mince words and make a whole bunch of tapioca nonsense out of some basic sensible syllables.
If you're 300 pounds, he'll say, Dude, you're fat.
Need to lose some weight.
He won't say, well, you know, why don't you buy some shorts that are perhaps a little more slimming?
Some vertical bars might work really well with that body type.
And you won't get politicians talking about stuff which is going to anger people.
Politicians now inherit the mindless mob that has been created and, in fact, planted, watered, and grown by public schools.
And I use the word schools because that's the general terminology.
It is not even remotely accurate.
They are really just indoctrination centers.
It's truly tragic.
But they have inherited a whole bunch of people Who don't know how to think, who are full of sentimentality, and who are looking for simple black and white answers, who are not used to the nuance of compromise or the limitations of basic economic and mathematical reality.
And so, how in a political speech can you educate people about the basic concepts of Logic, evidence, math, reality, finances, and so on.
You can't.
And remember, there's the howling mob of the mainstream media ready to jump on anyone who says that there's a basic economic, fiscal, mathematical reality to the situation.
That government spending has grown so much That to cut it is going to cause pain to people.
I mean, if you're horrendously in debt and you need to cut spending or raise your income or whatever magical alchemy they're going to try and do, there's going to be pain to people.
The government is injecting the straight cocaine of fiat currency and debt and borrowed and bribed money into the souls of the population.
There's a high, there's been a crash, and there is going to need to be a reduction.
Lord help us!
There's going to need to be a reduction in spending a massive shrinking in government.
Now, people use all kinds of words for this that are not true.
I mean, in Greece, Of all places, they're calling these reductions in spending austerity measures.
Austerity is kind of an old Protestant Calvinist word that means you're kind of going on a fast and living with a hair shirt in a cave somewhere.
Austerity is not The same as cutting massive bloated overspending.
I mean, if I'm making $5,000 a month and I'm spending $15,000 a month and then I try and ratchet myself down to $14,000 a month, that's not really the same as austerity.
If I'm eating 5,000 calories a day and I want to get down to 4,800 calories a day and I call that starvation, I may be accused of misusing the term, just a little, little bit.
But this is not the reality that politicians can say to people.
The speech that politicians should make but won't make is something like this.
People of the land, we have messed up big time.
We have messed up big time.
Everybody knows this.
People dance around it.
But government has gotten way too big.
Government has gotten way too much debt.
And we've got an entire couple of generations of people who have accumulated a huge amount of wealth because they've gotten a whole bunch of stuff for free, like roads and healthcare and retirement benefits and all of that.
And we know that they've gotten it largely for free because we have this huge, stinking, honking debt and massive amounts of untrunded liability, 70, 80 trillion dollars, depends on how you count it.
So, the government has kind of bribed you, the government has kind of lied to you, and you've participated in that.
I mean, let's be honest.
You all wanted stuff for nothing.
Who doesn't?
Hey, you know, it's found money, it's great, yay, found a gold bar sitting on a box in my front yard, no owners, no one's come to claim it.
Who wouldn't keep it?
So, the reality is that we have vastly overspent, we've vastly gotten in debt.
Now, the people who are really going to pay for that debt are the young, and this is the case in Europe where youth unemployment is topping 50% in some places, and it's the case here, where opportunities for youth are going to catastrophically decline as the price of their education goes up and their opportunities decline, and the debt load they're going to be forced to pay off rises.
We have really messed up the youth of this country by really imposing decisions upon them That were made before they were born without any of their participation, or certainly before they were the age to vote.
Now, Chinese economists have accurately told us that welfare state economies are run by decisions that are not optional.
Non-discretionary spending, they call them.
By far the biggest sections of the budget are non-discretionary spending.
And we need, of course, to change that.
This is not sustainable.
This is not possible.
This is going to be painful.
You wanted the government to give you stuff for nothing.
Everybody's intelligent enough who can tie their own shoelaces to know that this is simply unsustainable.
You need to look into the mirror and figure out what you were bribed with and why you gave way to this bribery, why you accepted this bribery, why when you knew there was a national debt you thought this could just continue unabated until the end of time.
Look in the mirror into your own conscience.
You know, the wages of sin is not pretty.
And we have sinned.
We have sinned against our children.
We have sinned against economic reality.
We have sinned against integrity.
We have sinned against virtue.
We have stolen from the unborn.
We have indebted to the innocent.
And we simply cannot justly force them to pay the bill.
So it's buckle down time.
It's austerity time.
It's a time to recognize that we can't get something for nothing.
And whatever we take that is not paid for is eventually paid for by other people, and usually more than could have been imagined at the time.
And the entire system that we've set up, where you've expected the government to take care of the poor and the old and the sick and the needy and this and that, and educate the children and tie your shoelaces and wipe your butts, this is all ended.
It's going to come crashing down.
We can either land this plane that's out of gas in a civilized fashion, or we can wait for it to just drop from the sky and there'll be a fiery crash on tarmac.
I vote that we try and land this plane a little bit more delicately, a little bit more humanely, but with the full recognition that mistakes were made, and to be frank, they were not innocent mistakes.
They were lies from politicians.
They were propaganda from academics.
There was attacks from the media for anyone who dared raise the basic truth and moral reality of what we were doing, which was stealing from everyone whose money we could get our hands on and bribing ourselves with the productivity of the unborn.
So we need to turn that around.
We need to change that.
But that Speech, which I do not expect to come floating across the airwave soon, requires that a politician be willing to stand before the inevitable backlash that would accrue from that, because there is no rage in the world like the pricked conscience of the guilty.
So, we're out of time.
We'll come back for another segment in just a moment.
This is Stefan Molyneux for the Peter Schiff Radio Show.
Thank you so much for listening.
I will be back.
We now return to The Peter Schiff Show.
Call in now.
855-4SHIFT. That's 855-472-4433.
Rebel Radio.
The Peter Schiff Show.
Well, well, welcome back.
Sorry about that technical glitch, everyone.
Sometimes the Canadian government forgets to feed the hamsters that run the Internet.
So we're back and we're ready to roll.
We're just getting a guest lined up.
We're going to talk a little bit about some of the latest science in global warming.
Well, slight correction there.
It's not exactly the latest science.
The data has been around for quite some time.
But...
It is the rational interpretation of the science that exists.
And I think that's really, really important.
So one thing that is usually not mentioned in the mainstream media, today's exception, of course, is always the case, is that, did you know that the greenhouse effects of CO2 have been known for about 100 years?
They've been recreated in laboratory experiments time and again.
No problem.
CO2 traps heat.
We all understand that.
That's not a big issue.
We also don't really doubt that putting more CO2 in the atmosphere is going to have some effect on the system.
Of course, the Earth and its climate is a very old and stable system, has gone through quite a lot of changes over the past couple of billion years.
And so it's really not likely that a small thing is going to create a sort of feedback thing, you know, like when you bring a microphone right next to a speaker, you get that ever-increasing feedback loop.
Got him.
But did you know that our guest David Evans is going to talk a little bit to us about the challenges of amplification and also the testability of climate models.
David, are you here?
Yes.
Well, very, very pleased to chat with you.
Thank you so much for taking the time.
I always feel when I talk to people in Australia who are actually tomorrow that they should tell me what the price of the Facebook stock is so that I can make a fortune.
So, thank you so much for taking the time.
You have received three degrees from Stanford University and all that, so clearly you've spent a lot of time in airless fluorescent rooms and have got the lack of tan and brain power to prove it.
Let's talk a little bit about this amplification thing.
I've read quite a bit about global warming.
I've never come across this idea before.
It seems pretty important.
I wonder if you could illuminate us, please.
It's the whole ballgame, Stefan.
The other side don't like to talk about it because the evidence runs the long way for them.
I'll give you the big picture.
Here's how it works.
When the global warming theory, the CO2 theory, was being developed in the 1970s, they looked back and said, look, from the beginning of the Industrial Revolution in 1750 to modern times, the CO2 level has risen by this much.
And the temperature isn't by that much.
Okay, now we know from theoretical calculations that pretty much everyone agrees on how much warming CO2 causes directly, just as a result of the extra CO2 in the atmosphere.
And that direct effect only accounted for a third of the temperature rise.
Okay, so we know the CO2 level warming since 1750, but it only accounted for a third of the observed temperature rise.
Now, here's the big jump in logic.
The theorists said, all right, well, we can't think of any other cause of global warming.
We know it's not solar, the sun getting brighter or warmer, because although the sun fluctuates a tiny bit, it's not nearly enough to account for the extra warming.
So, therefore, there must be some amplification.
And this amplification is due to what it calls feedback, because the Earth reacts to that extra CO2 in the atmosphere, the extra warming, by evaporating water off the oceans, by creating more clouds, etc., etc., And that must amplify that warming to account for the extra warming we saw.
Right?
So the direct effect only gives you a third of the observed warming, so there must be amplification by three to account for the rest, because we assume that CO2 is the only thing driving the Earth's temperature.
Are you with me so far, Stephen?
Absolutely.
Great.
Now, then they go and build a bunch of climate models where CO2 is the only driving agent.
And they built in this amplification.
Then, along comes the actual evidence about amplification in about the late 90s, well after this bandwagon had already picked up a lot of political and monetary clout.
So they're rolling along being climate scientists, being faced by everyone, the IPCC set up and the Kyoto Protocol is signed, the money's flowing, the bureaucrats are hired, and along comes the evidence from the climate, sorry, from the radio songs, the weather balloons.
But sorry, let me just back up for a sec.
Did the amplification effect, did it have any...
I mean, obviously a theory.
You can build a dial to turn up any numbers that you want.
Had there been empirical scientific evidence of the validity of this amplification process before the models were all put in?
By the late 90s, there was.
The way you collect this evidence, Stephen, is you use weather balloons.
Now, we've been sending up weather balloons since the early 60s, right around the planet.
They're released from about 900 locations around the world twice a day.
Since the early 60s, there have been 28 million of these things gone up.
As the weather balloon goes up through the atmosphere, it measures the temperature and it radios it back to ground.
So we know the temperature of the atmosphere through the last three decades.
Now, the amplification that's occurring Would exhibit itself, and it does in all the climate models, has a lot of warming.
In particular, there's a great deal of warming over the tropics, about 10 kilometres up.
That's because the theory of amplification says, well, there's extra warming due to CO2, therefore there must be more evaporation.
That happens mainly in the tropics, over the oceans.
That creates more water vapour.
Water vapour is itself the main greenhouse gas, so that causes even more warming in your amplification.
And that extra evaporation, as the water rises into the high troposphere, about 8 or 10 kilometres up, it must therefore condense, and that releases a great deal of heat.
That causes the hotspot.
Also, the extra water vapour is pushing the layer of warm water vapour higher into the atmosphere, where previously it was cool, dry air.
So that part of the atmosphere also becomes warmer.
So, weather balloons are up there measuring where the atmosphere is getting warmer, and by 1998 or so, the results were pretty clear.
There is no so-called hot spot over the tropics, about 10 kilometers up, none at all, not even a small one.
Now, sorry, again, I'm no climate scientist to say the least, but my looking out the window weather brain says, well, if you get more water vapor in the air, doesn't that create clouds which will reflect sunlight away from the earth, thus countering the effects of increased water moisture in the air?
Is that way off base or is that...
Vaguely possible.
You're a better climate scientist than most of those who hold the jobs.
Alright, let me add that to my resume here right now.
Go ahead.
It is fairly obvious that you put more water vapor up there, you get more clouds.
Now, clouds are cooling because they reflect the incoming sunlight to bounce back straight into space.
And indeed, there's a high correlation between the amount of clouds and the amount of warming.
It's not clear which is causing which, but by now it's pretty obvious that you get extra clouds and that causes cooling, or you get fewer clouds and that's what's been causing the warming.
Now, come 1998, the weather balloons are showing that there's no amplification occurring at all.
So now the climate science world, with the CO2 theory, is in big trouble.
They assume that there was no other causes of driving the temperature, therefore you needed x3 amplification.
But now we've got the weather balloons saying there's no amplification at all.
That's when climate change gets seriously dishonest, I suppose, is really what it comes down to.
Do you think they're just addicted to the money?
Addicted to the power or addicted to the prestige or whatever?
There are very few people.
This is sort of why you need a free market, I would argue.
There are very few people who want to put themselves out of a job, who work night and day to get rid of their own funding, which is kind of why you need a free market.
But of course, in the climate world, it's not a free market.
It's government funding.
And so I think that creates a sort of barrier.
Yeah.
And I used to be in that game, Stephen.
I worked for the Australian Greenhouse Office, which was funded, obviously, on this scale.
From 1999 through 2005.
And I must say, it does have a powerful effect.
Although I was aware that there was a lack of evidence and I sort of tracked it in my spare time on a sort of loose basis, it wasn't until I quit the job for other reasons in 2005 that I thought, let's look into this a bit more closely.
And I was aghast at what a paucity of evidence there was.
The evidence for the CO2 theory really boils down to, we couldn't think of anything else, therefore it must be CO2. You also mentioned in an article at Mises.org that a greater delineation in the ice core samples showed that temperature rises occurred at about 800 years before the increases in CO2. I assume that's because the CO2 that's trapped in the oceans gets slowly released as the temperature increases.
So, are there alternative theories that are coming up, sort of nibbling around the edges of the anthropogenic global warming CO2 theory?
What else is there that might explain this historical evidence that the temperature increases almost a millennia before the CO2 increases?
What high school students learn about in chemistry, called Henry's Law, that is to say the amount of dissolved gas over a liquid depends on the temperature of the liquid.
If the liquid gets cooler, More gas is absorbed, but if the liquid warms, it releases more gas.
That's all that's happening.
And the ice core, the higher time resolution ice cores, which got resolutions and data points nearly sort of tens of years apart, and they started coming in around 1998.
And they showed quite clearly, as you say, that the temperature went up first and the CO2 followed, not the other way around as being suggested by Al Gore and Co.
And that was a major piece of evidence that switched my mind and a lot of others and alerted us to the fact that the CO2 theory was bunk.
Now, that's simply caused by water absorbing and releasing CO2. There's 50 times as much CO2 in water as there is in the atmosphere.
And it only takes a tiny change in the temperature of the water to release or bring in a lot of CO2. That's all that's going on there.
Now, the big evidence, by the way, just as a matter of historical evidence, that came in around 1998, that first high-resolution ice cores.
Until from 1985 through 1998, we only had the old low-resolution ice cores where the data points to about 2,000 years apart.
But the gap between the CO2 rising and the temperature rising is only a few hundred years, so you didn't see that until 1998.
And by 2003, it was well established, and for everyone in fact, yes, the CO2 followed the temperature, not the other way around.
And so that period around 1998 through 2003 is when the gif that the CO2 was driving the temperature really fell apart.
The empirical evidence supporting it just disappeared.
Now, there's none.
Before we go, because we do have to tip the hat of the investment aspect of the show, what are a few Australian gold companies?
Let's really switch tickets if you could just mention briefly some Aussie gold companies to look at.
Well, it depends what sort of gold companies you look at.
There's 250 of them.
There's about 45 producers, 45 developers.
The rest are explorers.
Australians on the ASX are running gold companies not just in Australia, which produces about 10% of the world's gold, but also in Asia and Africa and South America.
We've got a range of companies that have low-margin operations and cheap gold in the ground or expensive gold in the ground and high-margin operations, all sorts of things.
Now, I've got some favourites, if that's what you'd like me to talk about.
I would.
We just have to dip into the commercial land of messages from our sponsors.
If you wouldn't mind holding on the line, I would love to talk about this on the other side of the break.
I love that intro.
I always feel like I should be catapulted into your radio waves, holding two flaming fireballs.
So we're on the line with David from Australia, who's talking about some interesting Australian gold stocks to watch.
David, are you still there?
Yes, Devin.
Yeah, thank you so much for your patience.
If you could just talk a little bit.
Again, I'm always surprised and I love this kind of information.
My father, I guess, still is a geologist and worked in South Africa.
So my focus on gold and so on has really been on South Africa and Africa.
And to find out that Australia's 10% of the world's gold production is really quite fascinating.
So what are the companies that are most tickling your fancy at the moment?
Well, this week, my favourite is probably a company called Tribune.
Now, Tribune's a very small company that's well and truly under the radar.
It's got about a $50 million market cap.
But what makes Tribune interesting is that the managing director is a true believer in the gold price increasing.
So he's been stacking away his gold in the local mint.
And the market really doesn't know about it.
And as a result, the market cap of the company is now less than half of the value of the gold that has got stacked away in the mint.
On top of that, this company has a 49% share of a really good mine near Kalgoorlie in Western Australia, and the other 51% is owned by Barrick, who is the world's biggest gold company and are quite professional and run gold mines quite well.
And this mine's going quite well, and it has several years left in it.
And Tribune's just stacking away this gold, and it's worth about $1.10 a share on the market, and the gold is worth about $2.30.
And on top of that, they've got a good gold mining operation.
So because the gold The sort of background for gold, Stefan, in Australia is that Australians haven't shown a lot of interest in the gold market.
So a lot of our stocks are basically fairly cheap because the locals don't show much interest.
In fact, there aren't any really large Australian companies except one because around about 2000, the year 2000, our gold sector got so cheap that foreigners, mainly North Americans, came in and bought all our big gold assets and we've got a lot of big American companies mining gold in Australia.
But only one big Australian company called Newcrest, by the way, which is fairly good value.
Another company I like is Silver Lake Resources.
It's been going for about four years.
It has a mine just 50 kilometres from Kalgoorlie.
It's got a nice underground operation.
They're making a lot of money because they're skilled underground miners and they can follow the fairly narrow veins.
They're growing quickly through organic growth.
They're self-funding.
I think the managing director did a deal with the devil because he has the luck of the devil and everything goes very well for him.
But the company is growing quite quickly and a couple of months ago they got off exploring for gold near their new tenants and they discovered a VMS copper instead.
So they might become a copper company, who knows.
But in any case, they could be doing very well.
And are there, for people who don't necessarily want to dip into individual, are there any aggregates or investment groups that focus on precious metals in Australia that you would recommend?
Not really.
No, it's pretty specialised, right?
It's Baker Steel, but they're not well marketed.
They don't seem to specialise just in Australian stocks.
Sprott, for instance, has quite a few Australian stocks.
For instance, he has a 16% holding in Silver Lake.
But you're not obviously going through Sprott's fund.
You're not just investing in Australia.
You're investing in a lot of places.
The Australian gold sector is pretty undeveloped.
It's not very mature in some senses.
Well, that's good and certainly if the stock price of a company is less than its assets to be liquefied, that's not a bad investment no matter what.
And what are your particular thoughts on the price of gold over the next?
I know this is like crystal ball prognostication that probably doesn't have a lot of practical value, but I'm most curious about the expertise in this area because people have been talking about gold going up relative to fiat currency for quite some time.
It's kind of stable for a little while.
What are your thoughts over the next year or two?
That's all right.
I'd like to give talks about this professionally.
The long-term basis, and gold as a currency, is almost entirely determined by the rate of debasement.
Now, the amount of above-ground gold each year increases by a little over 1%, but the amount of money supply, theatre currency, paper currency, in the Western world increases by over 12% a year, has been since the bubble started in 1982.
So, the price of gold will just go up and up and up against paper currency, because paper currency is debasing about 12% faster than gold is.
So eventually you're going to get a gold price of a million dollars an ounce.
But Stefan, the question is whether that takes 50 years or 500 years.
Now you ask me about the next couple of years, I think the trend will continue.
We've been in a very steady trend since 2001.
If you graph it on the log graph, it's almost supernaturally straight.
It's very unusual for a market-based price like that to be so straight.
It's been growing at 21% a year, so I expect it'll probably go up another 20% or so in the next year.
We've had a pause for the last few months.
We're probably due for a bit of a spurt.
Yeah, I mean, people talk about – obviously, everyone knows that the gold standard was – I mean, the gold window was closed by Nixon in the early 70s.
But there is a kind of de facto gold standard still floating around.
It's always interesting to me that the price of gasoline is considered to be very high.
But if you price it in gold, it's almost never been cheaper.
Also, that a good suit 100 years ago cost about an ounce of gold.
And now a good suit costs, well, wouldn't you know, about an ounce of gold.
There kind of is a gold standard even then.
Even though it's not official and not formally convertible between currencies, if you measure the value of currencies against gold, you can really see quite starkly, I think, the decline in value.
What do you think?
I think gold is the currency of choice as evolved by the free market over the last 5,000 years.
It's a hell of a pedigree.
And these Johnny-come-lately-fiat currencies come and go.
As an amateur monetary historian, very few fiat currencies have lasted longer than 50 years.
And I'll point out to you that it's 41 years since Nixon cut that link to gold.
I did a show on this once actually where I think they've actually measured there have been a few thousand fiat currencies that have bit the dust.
The only one that's lasted any length of time is the pound sterling.
I think it's closing on four centuries.
But that's the most successful fiat currency if you count by success the fact that it's only lost about 98% of its original value.
That's considered successful.
You could convert pounds to gold easily, freely, until about 1900.
And even from 1971, governments could take their pound in the US and convert those to gold.
So it was convertible to gold up to 1971.
So even the British pound has only been cut adrift from gold for 41 years.
Right, right.
So, David, I want to make sure that people can get more of your wisdom.
I highly recommend your articles.
I really wanted to compliment you on the elegance and fluidity of your writing.
That's something I think that's underestimated in its value.
So where can people find you on the internet and get more of your brain cells?
Well, thank you, Stefan.
I'm at sciencespeak.com.
Run the two words together, science and then speak.com.
And I've just posted all my articles there on a single page.
Very easy.
Well, that's fantastic.
And have you had any feedback from the articles you've written recently about global warming from anybody or any of the experts in the community?
Oh, yes.
I get a lot of feedback.
Oh, no.
30.
I get a lot of a barrage of criticism and name-calling from the warmest forces.
It's an interesting life being a sceptic.
You have to have a fairly thick skin.
Nonetheless, the data supports us and not the warmest, so we're encouraged by that.
And we keep on plugging along in our guerrilla warfare against these big government, almost 100 CO2 theory types.
Fantastic.
Well, I think it only goes to prove the axiom I started off the show with that anybody who deals in reason and evidence has got to develop a thick skin because there's quite a lot of profit in misinformation around the world.
So thank you so much.
This is David Evans, who is an Australian expert in, I think, just about everything.
And we will be back right after the break to talk about the budget or lack thereof.
All right, all right, all right.
We have tipped over to the second half of the show.
Hope you're doing well, my friends.
Please feel free to call in as the number is 855-472-4433.
I'd love to chat.
Let's talk a little bit about the budget.
Oh, is there anything more exciting to listen to than details about a budget?
I don't think so because I'm all about quality radio between your ears.
So this is what's being proposed.
This is the latest information that I can get.
Fiscal year 2013 in the U.S. House Democrats proposed to spend 3.704 trillion dollars and run a deficit of only 964 billion dollars.
The House Republicans, remember the Republicans?
The Republicans who really want to crush government down and destroy social programs and reimpose social Darwinism on a shivering and huddled Well, they actually proposed to spend, instead of $3.7 trillion, $3.53 trillion and run a deficit not of $964 billion, but only $796 billion.
You see, the Democrats who are on the left want to spend a lot of money, but the Republicans who are on the right, they want to spend 4.8% Less.
Do you see the choices that you are faced with?
You can choose 4.8% more, roughly, or 4.8% less spending.
And in what details?
So remember, the Democrats are not really good at national defense.
They're a bunch of pantyweights who just want to hand over the US to Al-Qaeda.
Well, on national defense, The Republicans want a new budget authority of 562.2 billion, while the Democrats want 553.9 billion.
You see there, you get to choose of a difference of 1.48%.
On agriculture, Republicans want 21.7 billion, Democrats want 21.8 billion, a difference of less than half a percent.
Let's do a couple more for funsies, shall we?
On Medicare, Republicans want a new budget authority of 510.1.
Democrats want 515.1.
That's a difference of almost a full percent, 0.97.
Look at those choices.
It's like you could go left or you could go right.
You could go into the fire or you could go into the ice.
So, income security.
Republicans want a new budget authority of 517 billion.
Democrats want 538 billion.
That is a difference of 3.96%.
My goodness.
As George Wallace said, there is not a dime's worth of difference between the Republicans and the Democrats and I think that logically and really fiscally we're getting very close to that.
Now of course all of these numbers are nonsense.
I mean they're fun to play with, they're fun to turn around in your head and it's fun to see just how little difference there is between the proposals of the two parties.
Because the reality is that these are just numbers and no one has actually talked about what is going to be cut.
I'd like a 4% cut across the board!
That's easy to say and the wonderful thing about that is that no one's going to get particularly angry with you because you're not threatening anyone's interests in particular.
Because you're not going up to someone and saying, listen, man, sorry, you're fired.
You're laid off.
You're not going to a department and saying, you've got to get rid of this guy, this guy, this guy, and this guy.
Because as soon as the laser pointer of budget actually lands on anyone's forehead in particular, oh my goodness, oh my word, oh my dear, you have now created an enraged mob of people desperate to cling to their private sector makes public sector perks, pensions, health care, retirement savings, you name it.
And this is why our brave noble heads of state, the steers of the ship of state, never ever want to point to anyone in particular and say, you sir, you, you in the green cardigan, you currently there dozing on the job, you are out of here.
Because the moment that you identify anyone specific or any group in specific, you are going to rouse their ire and they are going to spend like crazy to bring you down.
You're going to get recall elections like you did in Wisconsin.
You are going to just up here in In Canada, there are millions and millions of dollars just in one little province that public sector unions can spend on political campaigns because forced association, which is a violation of freedom of association, is pretty much the way that government unions get their cash.
They get their cash from forced union dues and they use that cash to threaten anyone about their own political interests and that is not a good way to run any kind of country.
And the fascinating thing is, of course, that unions were originally intended to counter the profit-seekers of the capitalists.
Let's put on our pointy Marxist hats for a moment and just look at sort of basic class theory.
So the capitalists want all this money, they want all this profit so that they can buy, you know, more gold coins to pour into their bathtubs and swim around, probably semi-naked, and given the body type of most rich capitalists, that's not a pretty picture for anyone.
And so they want to make all this money, and the way they do that is they drive down the wages of the workers so that they get even more money.
Now, this is a peculiarly isolated view because, of course, capitalists want skilled and intelligent workers so they can make lots more money, but in the Marxist view, they never compete for each other's workers, right?
I'll never pay, you know, 12 bucks to workers rather than 10 bucks because I want better, smarter workers, and, you know, Henry Ford doubled workers' wages by putting in assembly lines and divvying up the labor, which Marxists hated as well.
But see, that's the driver for the unions.
The unions are there to counter the predatory desire for capitalists to drive down wages so that they can make more money.
I mean, it's infantile, it's simplistic, it's ridiculous, and it's false.
But let's look at the public sector unions.
And we got a caller.
I'll get to you in just a second.
Public sector unions should not exist according to any kind of left-wing theory because the government is not driven by the profit motive.
And so you should never need unions.
Unions are only needed because the capitalist wants to drive down the workers' wages for the sake of making his own money.
That does not operate within the public sector system.
And so you should never have I mean, you can't rationally have a monopoly on services plus a union that can cut off those services at any time.
So it's all nonsense, but let's get to the true brains of the outfit.
We have Bill from Cedar City.
He's got a question for me, Bill.
Are you available to speak?
I am.
How are you doing, Stefan?
I'm a real big fan over here.
I'm just great.
I'm having a blast.
I really appreciate the show's giving me this opportunity.
So what can I do for you, my friend?
Hey, I was just wondering, what do you think of the criticisms of the sort of ANCAP, you know, anarchist-capitalist movement from the left-handed sort of traditional anarchists?
I get, anytime you're on a board or something like that, it's always, well, you're not real anarchist, I don't even know what the hell you're doing here, you know what I mean?
It's very vitriolic, when really we're sort of trying to You know, achieve the same goal, which is no rulers, you know what I mean?
But they have this sort of proprietary definition of what anarchism is, and just wondering your thoughts on that.
Yeah, I mean, these are the people who really believe that we should live in small, smelly, hippie communes with no property.
Is that the general type that you're talking about?
And almost to the point of, I mean, they have...
One minute.
...as far as, I mean, the non-aggression principle, and, you know, they have no qualms about, oh, yes, I mean, it's going to be a revolution, and you will come along, you know, it's we're militant, we'll make you, you know, sort of...
Yeah, look, there's a real vanity around a lot of people who have big ideas about society.
I've had my own issues with it, so I constantly battle it, but the reality is I don't know how other people should live.
I don't know how other people should live.
Hippie, smelly costumes and share kidneys and bedsheets and lice, that's fine.
I don't think it's not for me and maybe it's not a good idea in general, but I don't have the right to impose my views on them.
In a free society, if people want to live without property, they can do so.
They do not have the right to initiate force against me to force me to live without property and that's where I put myself at a grim distance.
I don't like the term anarchism in particular.
It has all this baggage and people picture me throwing stuff through a Starbucks window.
All we're about is the non-initiation of force and optional respect for property rights.
We'll talk about more of this after the break.
Please feel free to call in.
This is Van Molen from the Peter Schiff Show.
All right, all right.
Hello, everybody.
Welcome back to the Peter Schiff Show.
If you would like to call in, please call 855-472-4433 and talk to our wonderful board-ups, and you can come on through and have a chit-chat.
And let's talk a little bit about the theme of the show. - Oh, such as it is.
I'm trying to stay on target.
I always have this X-wing voice in my head when I'm doing any kind of show.
Stay on target, stay on target, because I'm very liable to crash into the side of the Death Star wall and go out in a flame of eloquent uselessness.
But we do actually have a caller.
We have a caller on the line.
Let's jump to the caller.
I can, of course, hold off on my stuff.
We have Anthony from Ottawa.
Are you around, Mr.
T? I am.
How are you today?
I'm just great.
How are you doing, man?
Super, super.
I actually didn't know you were hosting today.
I usually listen to the show after the fact, but I knew you were on the air, so I'd call in.
And my question is, the government requires us to have liability insurance on automobiles, and I was just wondering what your thought was on that, but the government requiring us to have liability insurance on vehicles.
Well, I think this is an example of the domino effect of using force to try and solve social problems.
It's really quite tragic.
If the roads are privately owned, and let's pretend for a moment that human beings that can design cell phones, the internet, and get a man on the moon can somehow figure out a way, as they did a couple of hundred years ago, to get people to pay for private roads some combination of GPS and billing or whatever who knows right but if the roads were privately owned there is an optimum amount of insurance and so my guess would be if I have a road people would prefer to drive on my road if
the if they knew the other drivers had insurance I mean I would like I would prefer that because if I'm driving along and someone plows into my car and they don't have insurance Then, you know, I'm SOLs pretty much.
So I would rather drive on a road where I knew people had insurance.
So if I were a private road owner, it would be a selling point of mine to say, I only let people drive on this road if they have insurance.
And who knows exactly how much insurance that should be or what the optimum amount is and all of that.
We simply don't know.
And so it's sort of an example of one area.
Sorry, go ahead.
I was going to say the free market, for example, would determine that.
What would be the optimum amount of insurance would be through free market principles, I presume.
Yeah, and that would change over time, and when Google's robot cars start driving us everywhere, that would change again over time.
So this is an example because the government, well, I shouldn't say the government owns the roads, because that's like saying that the tooth fairy owns a ghost.
But, you know, we have this violent control over, coercive control over transportation systems, and as a result of that, then you need to force people to do this, and you need to force people to have licenses and all this kind of stuff.
Is that the optimum and most efficient thing to do?
Absolutely not.
There's no question of that.
This is funny.
They say the government reflects the will of the people.
The exact opposite is true.
The iPhone represents the will of the people.
The Android operating system for phones represents the will of the people because that's what people freely choose, more or less freely.
The government represents exactly what people don't want to do.
People don't want to pay into the welfare state because 80-90% of the money goes to bureaucrats and very little of it goes So, this is the real tragedy.
This all reflects what people don't want.
And all of the efficiencies that would come out of private road ownership, like charging for volume so that people would stagger their time to get to work and to start and all of that, all of these efficiencies simply don't happen because it's all sort of paid for, so to speak.
And so, yeah, this would be my argument that I would rather drive on roads where everyone was insured and that would be a service that would be provided.
And that would be my guess.
What do you think?
Well, I agree and thank you very much for taking my call.
It's most appreciated.
You're very welcome.
855-472-4433.
I will continue to ramble until I get another brain ping from a brilliant listener.
And I must say, I really, really enjoy the Peter Schiff listeners.
You guys are smart and a half, as my uncle used to say when I was a kid.
Oh, we have another one.
Chris in New Jersey?
Dare I do a New Jersey accent?
No, way too across the pond fruity for that.
So, Chris, what's on your mind, my friend?
I've lived in Jersey my whole life.
I've never heard Joy-Z. I've never heard anyone say Joy-Z. Is that a complete stereotype?
Is that like shrimp on the barbie, which I was tempted to use with our previous guest?
Is that just a complete myth?
I love that movie.
If you're referencing Dumb and Dumber, that's one of my favorites.
My question?
I have a couple of questions.
I'm a political science student.
And I'm like the only anarchist in my school, so it's pretty interesting.
I was wondering, how would you define, in an anarchy, how does one justly acquire property?
And especially in relation to Locke's definition for acquiring property.
Right, the infusion of you infuse your labor into something and it becomes yours.
Well look, property, everyone wants to start – maybe not you – everyone wants to start discussions on property with like intellectual property and homesteading in the wilderness and so on.
But I think it's always profitable to start discussions of property with your own body.
I mean your own body is a thing.
Invest your labor into it.
I mean, I feed my kidney, I feed my spleen, I feed my thighs and all my other internal organs, muscles and tendons and whatnot.
I've been growing them low these 45 years into the semi-muscular, middle-aged perfection that they are.
I think when we start talking about property, the first thing we need to talk about is self-ownership.
Clearly, we own ourselves and nobody can carve out my liver because they need it more than I do or say that they do.
I think the sovereignty of our own persons is the beginnings of the origins of property.
Now, when it comes to things like land, I think it's important to remember that people, they don't really want land so much as they want whatever land can produce or can be produced on land.
So, if you're homesteading, you set up a bunch of fences around some unowned land, If someone were to say, okay, you can set the fence up around this, but you can never grow anything on it.
You can't ever walk it.
Don't even look at it!
You can't build a house on it, and I'll never even tell you where it is.
Well, nobody would want that, because you couldn't do anything with it.
So, people want land so that they can put a home on it.
People want land so they can grow crops from it.
And people may want land so they can enjoy the pretty sights of butterflies flitting through the tall grass, whatever it is that they want.
But it's what land can produce.
And the property rights, to me, is really in what is produced.
Now, if you go fishing, there's a fish somewhere in the lake or the ocean that is pretty much not owned because it's down there in the depths and it's not doing much other than swimming around and making fishy guppy faces.
But when you pull that out and you fry it up and put it in a sandwich, then suddenly it becomes something that has used.
You've really created that fish as property.
It didn't really exist as property before.
It's the same thing with crops in land.
You plant a bunch of corn, you raise corn, you get your ears of corn.
They're really tasty.
I love corn.
Well, that only exists because you have created it.
So property, fundamentally, in the way that I look at it, is that which is created, not just homesteading.
Now, if you can't homestead, if you can't put fences around a piece of land, then you're pretty much unlikely to grow anything.
We can sort of recognize that from Stalin's disastrous attempts at forced collectivization of the farms in the 1930s or the Khmer Rouge later on or what happened with the starvation under Mao's communist China that if you don't have property rights, you don't get any food and everyone starves to death, like if you don't have land property rights.
But fundamentally, it's not about the land.
It's about what the land produces.
So I enclose some land, I plant some crops, I water them, I grow them.
To me, that's...
It's philosophically indistinguishable from my kidney.
It only exists and has utility because I have grown it and fed it and watered it.
There's no magical distinction between that which is inside the body and that which is outside the body.
To me, if people can start understanding the body from a property rights standpoint, it's a lot easier to explain other things.
Does that make any sense?
It makes perfect sense.
In reference to that, based on Lysander Spooner said that wage labor...he was against wage labor.
I don't know if he called it best.
Now, is it just to acquire from another person's labor?
Sure.
The person who's selling his labor, he's renting out his labor in exchange for your capital equipment.
That's not very clear.
If you can hold on, we'll talk about this after the break.
It's really, really important because this is a fundamental leftist critique of the free market that you get these wage slaves and so on.
But I think there's a way of looking at it that shows how much of a win-win situation it is.
That's a really important topic.
Thank you for bringing it up.
We'll talk about this right after the break.
All right.
We are coming back.
Oh, and now we're talking about the labor theory of value.
So, thank you so much to our caller, Chris, for staying on the line.
Let me give you a brief explication.
Oh, my God!
I'm going to try and keep it brief as best I can, and then you can tell me if and where I've gone way off the rails.
So, one of my first jobs, let's go, my very first job was I assembled newspapers and stock books and all that in a bookstore when I was 11.
And I loved it.
It was just great.
I got some pretty cheap books out of the deal.
And I got paid some ridiculously low wage, like two bucks an hour or something.
This is way back in the day.
But I really liked the job.
So was I a wage slave?
No, I wasn't a wage slave.
Obviously, what I was able to produce was very low and limited because A, I was 11 and B, I've been in government schools up to then, so I hadn't learned anything of economic value, which was to change – never, that would never change.
All the economic value that I've accrued, I've accrued outside of formal education.
But what was I doing there?
Well, I was selling my labor for sure, but what was I buying?
What was I buying?
I was buying a bookstore.
So if you're a guy who doesn't want to spend $50,000 on some monstrous lathe, then you can go and you can sell your labor to someone who has already paid for that lathe and they will give you less money than if you owned the lathe yourself But that's because they've already spent the money on the light.
Somebody spent $10 million creating some factory and you go and work there.
Well, you are buying the increased productivity of the factory that they've built.
So let's say that you want to build a car on your own.
You can build, I don't know, one car every six months if you do it all by yourself.
If you go into some factory, then you can probably build or at least participate in the building of many cars a day or an hour.
And so you get more money By joining your labor with existing capital infrastructure than you would if you were just out there trying to make and do everything yourself.
I mean, why do you go and buy a screwdriver rather than make one by digging in the earth and looking for some steel or iron or making steel or whatever?
Because that's a ridiculous waste of time, effort and energy.
And so what you're doing is you're trading and you're amplifying your own productivity It's like a singer who sings without an amplified microphone and a sound system can only sing to, what, 50 people?
But if you're Freddie Mercury, you can command a crowd of 300,000 in South America because you've got all of that amplification.
And he takes a little bit less wages because he's buying a big sound system and a light system, but in return, he gets to...
Sing to a whole lot more people.
And so it's not a loss.
It is a true win-win situation, assuming again, of course, that everything's in the free market.
Does that make any sense?
That makes perfect sense.
Now, I was wondering, and once again, in anarchy, there would be no need for an executive, but that doesn't mean there's no government.
There would still be law, correct?
So how would one go about, or how would a society go about, electing a legislature?
Would it be a democratic process, or...
I'm wondering, a legislature or judiciary?
How would conflicts be resolved in a state and society?
That's a great question.
The first thing I want to point out, and this is not your doing, but this is the general pattern of these kinds of questions, is that people say, well, how would, say, criminal cases be resolved without a government?
And that sort of indicates that they're being resolved now in some reasonably just and fair manner, which is just not the case.
Tell me, what percentage do you think of U.S. criminal cases actually end up being tried by a jury of peers?
It's probably a remarkably low percentage.
I don't know off the top of my head, but justice is not served in this country under a current system.
I fully agree to that.
Yeah, I mean, so it's about 5%.
Because what happens is 90 to 95% of cases, they simply threaten you with crazy amounts of jail time until you plea down, right?
And so you never get to present your case, and frankly, it's a shakedown.
And most people would just like, but bird in the hand, well, I'm not going to...
And also they know, or at least the rumor seems to be that if you go to trial and you're found guilty, you get the maximum sentence because the judge is...
I think they just did a study with 2,000 unjustly convicted people.
It's just the people they can find over the last little while in the U.S. system.
And this is not to pick on the U.S. system.
I mean, this is common all throughout the world.
So people say, well, how will justice be served in a free society?
Well, the first thing to recognize is it's not being served now.
If we can get to 10% of people being tried by a jury of their peers in a free society, we're doing twice as well as a state of society.
I'm not saying that's your perspective, but there is this assumption that it's working now, and how would the wonders of that which is working really well in a state society be reproduced in a non-state society?
In terms of contract, it's relatively simple.
You can look at eBay.
It's got hundreds of thousands of people, one of the largest employers in the world, so to speak, and they really don't have any access to law courts.
You can look at a third.
Between a quarter and a third of the world's economy operates in the gray or black market with no access to adjudication, and it seems to get by relatively okay.
Outside of the drug trade, certain mafia-entrenched, statist-protected industries seems to be doing pretty okay.
There's tons of evidence that it works.
But basically, if you and I enter into a contract, we simply have contract insurance, which means that if I welch on the contract, some third party is going to pay you the value of the contract, and if you welch, they'll pay me.
And we simply pay for that service.
And we can choose not to, in which case we just take the risk that we don't.
And if we've been doing handshake business for 30 years, we probably would avoid that as an unnecessary overhead.
The more honest that you and I are with our contracts over time, let's say it's been 25 years and we've never broken a contract, how much do you think it's going to cost to insure our contracts?
Almost none.
Thus, virtue and integrity gets rewarded and if you're a cheat and a scoundrel and so on, then That's clearly evident in your contract insurance or whatever.
So there's lots of ways to get contracts to be insured and the people who are doing the third-party insurance want to keep the cost as low as possible to remain as competitive as possible.
So they're going to try and drive down the cost of enforcement.
That's not something that's present in a state society.
They do not drive down the costs of enforcement because there's no competition and so the costs just tend to go up and service tends to decline whenever you have an enforced monopoly.
Does that give you some indication?
Maybe there's some other way.
This is just what I've thought of.
If I could figure out how everything would work in the future, I'd be a great dictator, but it's impossible.
That's one aspect.
Does that help at all?
I found that to be excellent.
I wish we had spoken before my last semester.
I would have had a lot of good stuff from my teachers.
You also might have got Fs everywhere, because people sometimes don't like it when you come up with reasonable answers to problems that people consider insoluble.
Sorry, you were going to say?
I was wondering.
Marx recognized the dialectic between labor and the owners, so the proletariat and the bourgeoisie.
It's my observation that I see a dialectic between the citizens and the state, and with the struggle being, you know, the state oppression on the citizens and, you know, the destruction of our, you know, natural rights.
So, obviously, the synthesis of this would be a free society, a stateless society.
What do you think the new, if under a stateless society, we're following the dialectic, what would be the new synthesis and antithesis?
Do you mean, would there be sort of a class system?
Would there be sort of inherent or endemic conflicts in a free society?
Well, from what I see, according to Mark's dialectic, you know, he had the owners and the owners of, you know, and the laborers.
The owners and the laborers.
And the synthesis was supposed to be a, the owners, the laborers owned the means of production.
That was his synthesis.
But the new antithesis and thesis was, you know, you had the people that worked for the government and the people that didn't work for the government, at least in Soviet Russia and in I think I do.
Let's just talk about Marx for a sec.
I think Marx was a syphilitic monkey brain from hell, so I have a huge amount of contempt for his thinking, but it's still worth trying to understand why it seems believable.
Of course, in the 19th century, a lot of the investment capital came from the aristocracy.
The aristocracy had come by their wealth as a result of being the most efficient killers around.
They'd slaughtered the most people for the king, so they got all these tracts of land.
They were the best hit men, and that's called the aristocracy.
A little hard to think of when you're looking at the Queen Elizabeth II, but that's sort of where it comes from, and so a lot of the origins of capital in the 19th century were pretty unjust.
And a lot of the people who were driven into the cities by the enclosure movement, where they sort of closed off all of the historically divvied up surf lands and so on, they drove it into the city.
They were getting paid very little.
And so to Marx looking at that, thinking, well, how can these poor workers ever accumulate the capital to compete with all this unjustly created historical capital?
But...
That's to blame the free market for what it inherits from feudalism.
You can try and do that, but it's just not a rational or just thing to do.
That dialectic, I think, is understandable, but it hasn't proven true.
Even now, the US is a very fluid class-based society.
People go up and down in the classes all the time.
All the time.
Rags to riches to rags all the time.
Companies turn over.
There's only, I think, five companies left from 100 years ago on the Fortune 500.
They've all gone the way of the dodo.
Other new ones have come along.
That's this creative destruction.
He hadn't seen the change from the horse carriage to the horseless carriage.
That, I think, is really, really important to understand.
He was looking at the very beginnings of a system that had unjust origins and took a while to work it out.
I think the fundamental division in society The fundamental division is not between rich and poor, not between capitalist and worker.
It is between those who profit from violence and those who pay for violence.
Those who pay off the people with the gun and those who get paid off by the people with the gun.
That has something to do with rich and poor but not exclusively.
So somebody who is getting twice the salary and benefits of a private sector worker is getting that money at the point of a gun, and the private sector worker is paying for it.
Somebody who's feeding off the trough of the military-industrial complex, some rich corporation, they're also on the side of profiting from the gun.
We've got another caller who wants to talk about health care, which is a great topic.
We're going to be right back after the break.
I can't believe it's our final segment.
I'm going to miss you all so much.
Remember, I will be back Thursday morning.
with more brain food for your mental goldfish.
There's a metaphor that works for me.
We have Ed who wants to talk about healthcare.
Ed, are you there?
Hello?
Hello.
How are you, my friend?
Hi, Stefan.
Thanks for taking my call.
I have a question about the healthcare industry and with the coming difficulty, how do you think that industry will fare?
And then I have a second question which It's from Peter Schiff.
I'm reading the new book.
And he's talking about the country that he's expecting to do well.
And my question is, if someone has an opportunity to move to one of those countries, should we do that?
Well, as far as healthcare goes, I talked at the beginning about how politicians aren't really good at being unpopular.
I mean, if they're good at being unpopular, they tend not to be politicians.
And so one of the problems with healthcare, I mean, there's lots of problems with healthcare that Are to do with the government, right?
As you know, federal government spends about 50 cents of the healthcare dollar spent by government at federal and local levels and there's a monopoly and there's all this hyper-regulation and barriers to entry from non-doctor competitors and all that kind of stuff and a monopoly on the prescription system and an over-reliance on pills and no profit, little profit in prevention and most of the profit in endless cures.
So there's lots of stuff That is going on that could be addressed by a politician but of course the moment you start touching special interest groups they scream like a harpooned narwhal and believe somehow that even a minor reduction in their unjust salaries is the akin to banishing them to some desert to starve and eat sand for the rest of their days.
But one of the things, of course, that a politician could say to Americans, this is my very brief fantasy speech that a politician could deliver, regarding healthcare, my friends, Romans and countrymen, regarding healthcare, look, the healthcare system is messed up six ways from Sunday.
It is a Mobius strip interdimensional kaleidoscopic mess, and we ain't going to fix it in any reasonable timeframe, guaranteed.
Let's look at the reality.
Seventy to eighty percent of your health care problems are the results of your own bad habits.
You're too fat!
You smoke too much!
You eat bad food!
You don't exercise, people!
So how about not complaining to the government about your health care, but how about actually taking control of your own health care yourselves?
Yeah, we've messed up the system.
Yeah, it's way too expensive.
But eat less, exercise more.
How's that for a government program that you can actually put into practice in your own lives?
Look in the mirror.
Put yourself on the scale.
Measure your BMI. It's not perfect, but it's not bad.
Can you pinch more than a fistful around your waist?
Well, start losing some weight.
Do you eat out a lot?
Well, don't eat out so much or ask for half portions.
Do you eat a lot of fast food?
Do you drink 600 cans of soda pop consumed by...
The average American every year.
I mean, that's astounding.
They're like two a day.
A lot of that is sugared stuff.
Stop eating so much sugar.
Stop eating so much sugar.
Your health is your responsibility.
You cannot simply reasonably just defer it to everybody else.
So you all need to get your own healthcare in prayer.
We'll work up here in Washington.
We're going to try and unravel this mess, try and cut through this Gordian knot that has accumulated over the years.
But that isn't going to be quick enough to save Your enormous butt.
So you need to put down the Twinkie and pick up a barbell and start taking control of your own life.
Now that would eliminate a huge amount of healthcare costs, but that is really not the way that America is going in terms of healthcare.
So, that would sort of be my fantasy speech that I don't expect any politician to make any day soon, because that's just a little too much truth for the average voter.
My immediate concern is this.
There will be about half the funds available, roughly.
I mean, the Medicare and Medicaid is going to shrink, and every other insurance company is going to have less funds available.
And how is that going to affect the industry as a whole?
Well, it's going to go bankrupt.
Look, this is my prediction.
Sorry to interrupt.
This is my prediction.
The U.S. healthcare industry is going to go bankrupt, require bailouts, and then it's going to get nationalized.
Because this is what happens when you interfere with the free market.
You either stop interfering with the free market or you end up with a government takeover.
There doesn't seem to be much in the middle.
So the U.S. healthcare system really began to go down the moment that you allowed people with pre-existing conditions to sign up for healthcare.
I mean, that's like signing up for life insurance after you're dead.
I mean, it makes no sense.
The whole point of insurance is it's a gamble.
So if you say to people, well, if you have a pre-existing condition, you still have to be accepted, all that happens is people say, well, I'm going to wait until I get sick and then I'm going to apply for health insurance.
And so that just toasts the whole point and process.
And until that is reversed, which is going to be great cost and great pain and great agony and there are going to be sick people who are going to do badly through that and that's really tragic and horrible.
It's really tragic and horrible.
But if that is not reversed, then the costs are going to continue to escalate until it becomes absolutely unsustainable and then they're going to try and hide the cost through debt and hidden taxes.
So they're going to take over the industry, they're going to go further into debt until the whole system comes crashing down.
But it's not sustainable the way it is now.
You get more and more interference in the remnants of the free market driving up the costs more and more.
The system is going to end up nationalized which is not going to stop the cost problems but it's going to mask them because the government can borrow more than insurance companies can and pretend that it's somehow made some advancements.
No, the government either has to step back or take it over and it certainly doesn't seem to be doing the former and so my suggestion is take care of your own health.
The system is scary and dangerous and very expensive so take care of yourself.
As far as moving goes, I don't know.
It's a tough call.
It's a tough call.
I mean the guy just left, one of the co-founders of Facebook just left to go to Singapore right before the Facebook IPO because he wanted to avoid paying hundreds of millions of dollars Yeah, and now, of course, they're going to chase after him anyway because apparently it's now tax avoidance if you want to avoid taxes before they're even due.
It's like if you move out the country, they're going to tax you next year because otherwise you'd have paid taxes in the U.S. Well, the tax bill wasn't even assessed on him yet, but apparently they're still going to try and hold him liable because they're acting as if Singapore is a neighboring farmer that stole their best cow.
So they're damn well going to go march over there and try and get it back or at least the milk.
I don't know.
Moving is a tough call.
It's a tough call.
People have embedded social relationships, friends, extended family.
You might have licensing restrictions that keep you in a particular area.
It's really tough to say to people, you've got to move to some new country.
I think that we continue to stand here and speak the truth to power as much as we can so that when the crisis comes, people will know that this is the result of force, power, control and Unjust laws rather than the problems of freedom.
That's my argument, but tell me what you think.
I don't know.
Are you better off watching this whole thing unfold in Australia or Singapore and just watching it on TV as opposed to being part of it?
What do you think?
I don't know.
That's what I'm trying to...
I mean, look, there's going to be a transition.
I predict that there's going to be an interruption in the food supply.
I think that's pretty inevitable.
So I recommend, you know, get yourself some food in the basement.
I mean, it's a no-lose proposition since the price of food continues to go up.
Get yourself some food in the basement and, you know, if you can grow a garden, grow a garden.
I think all of those things are useful.
I think that the rulers have been around for a long time.
They're really good at staying in power.
I think they're just going to turn against the dependent classes, rouse popular sentiment against those on the receiving end of government benefits.
There's going to be a huge wrenching change for a year or two, and then I think things are going to get better.
There's no way that the ruling classes are going to give up on the most profitable tax farm that has ever been invented.
They'll simply reform it to bring it back to productivity, but they won't do that.
Until the very last minute.
What do you think?
Gotta go!
Gotta go!
I will be back here Thursday morning at 10 a.m.
Thank you so much to everyone.
This is the Fan Morning from Peter Main Radio with Peter Schiff.
