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Dec. 12, 2013 - Freedomain Radio - Stefan Molyneux

01:19:06

2556 Sympathy for Politicians - Peter Schiff Radio Show December 12th, 2013

Stefan Molyneux guest hosts the Peter Schiff radio show and speaks with Mark Skousen on what to make the budget compromise in Congress, and why the new GDP measurement is actually a good idea. Gerald Celente, publisher of the Trends Journal, also joins the show to discuss the continued decline of the American empire.

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	Make no friends in the pits and you take no prisoners.
	One minute you're up half a million in soybeans and the next boom.
	Your kids don't go to college and they've repossessed your bentley.
	Are you with me?
	The revolution starts now.
	Starts now.
	We have to pass the bill so that you can find out what is in it.
	Turn those machines back on!
	You are about to enter The Peter Schiff Show.
	If we lose freedom here, there's no place to escape to.
	This is the last stand on earth.
	The Peter Schiff Show is on.
	Call in now.
	855-4SHIFT. That's 855-472-4433.
	I don't know when they decided that they wanted to make a virtue out of selfishness.
	Your money.
	Your stories.
	Your freedom.
	The Peter Schiff Show.
	Good morning, everybody.
	I hope you're doing well.
	I'm on my second coffee, so I'm going to speak so quickly and so high, it's going to pretty much sound like a fax.
	but you can slow it down and play it back later.
	Stefan Molyneux sitting in for Peter Schiff.
	I hope you're doing well this morning.
	We have got a show for you this morning, ladies and gentlemen.
	The great Mark Skousen, who is editor-in-chief of the financial newsletter of forecasts and strategies and has written over 25 nonfiction books.
	I believe he's branching out and writing the sequel to The Hunger Games.
	We're working on that with him today.
	And we have Gerald Salente, Mr. Hatch.
	Happy.
	He will be doing a soft shoe number and reminding you just how glorious the world of statist economies is.
	Or not.
	We'll find out.
	We're going to have those on.
	And we're going to be talking about, oh, did you hear?
	That magic word compromise.
	Oh, isn't it lovely when the lawmakers compromise?
	You know, it's like when the zombies decide to eat half your brain instead of all your brain because they want to save some for later.
	So that's really what is going down.
	We're going to talk a little bit about that first thing this morning, set the stage.
	And I'm going to give you some tasty emotional sympathy for our poor, benighted lawmakers.
	You know, we give them such a hard time.
	We want them to do all this great, noble, or even vaguely moral stuff.
	And they just, you know, they keep disappointing us.
	They're like that unpracticing kid of the Asian tiger mom, just not able to get chopsticks right with their forehead.
	It is really tough.
	And we, you know, we slack on them quite a bit, but I want to give you some sympathy for them.
	You know, let us reach out across the aisle of the moral trench, across the flaming crocodiles of ethical outrage, and give a virtual hug to the cats in Washington.
	So a budget deal has been reached.
	It's still wending its way through the lower intestine of how a bill becomes a law.
	But they've reached an agreement.
	And usually that means that bad things are about to happen.
	You know, whenever they say, well, we've reached across the aisle, you know it's going to be a Bride of Chucky situation.
	It's just not going to be good.
	So what's happened is...
	Budget cuts have been claimed.
	And what kind of budget cuts are we talking about?
	Well, in the topsy-turvy Alice in Wonderland language of the state, spending will be $45 billion higher in 2014 than it would have been without the deal.
	And that, my friends, is what they call a cut.
	Let me tell you what government cuts mean.
	Let's say I'm like True Jabba the Hutt, big-bellied guy, 400 pounds, and I eat 10,000 calories a day.
	And I'm planning next year on increasing my calorie count to 11,000 calories.
	My doctor says, you know, it's pretty unhealthy, man.
	It's pretty unhealthy.
	You should not be doing that.
	And I then say, okay, well, I'll tell you what.
	I was going to increase to 11,000 calories.
	I'm going to go to 10,090.
	And he says, hey, that's a great diet.
	Just don't go too far and lose all the weight at once.
	Government spending is projected to increase every year because it's the government.
	They can print the money.
	They can do what they want.
	And then when they say, well, you know what?
	Government spending was going to increase 4%.
	We're going to make it 3.8%.
	They call that a cut.
	Try that with your visa company someday.
	Let me know.
	Let me know how it goes.
	So the question is why?
	Why do they go through this ridiculous theater of pretending to cut things?
	And, of course, the cuts will never come to be.
	One of the things that happened in the 90s was the...
	This was the last time, I guess before now, that the Republicans...
	Said, well, okay, we will increase taxes, but we also want twice the cuts for every dollar we increase taxes.
	Of course, the tax increases went through.
	Did the cuts ever materialize?
	Of course not.
	This is one of the skepticism that the left-wing media keeps from the general population to make everything as lopsided as humanly possible in the evaluation of public policy.
	So what's happening...
	There's going to be fees that increase.
	You can't call them taxes.
	It's like up here in Canada, they put in a health care tax and they called it the fair share health levy.
	I mean, who's against fair share, man?
	Come on.
	Give me some of that pie.
	Same size as yours.
	Health care can't be against that.
	And it's a levy, which makes you think of Don McLean.
	Oh, if you're under 30, ask your parents.
	So what is going on?
	Look, I mean, this is a serious topic, so I'll try not to be overly glib, as is sometimes my habit.
	But what is going on?
	Well, I would like you to picture, if you will, that you receive a letter in the mail.
	And when you open that letter, it says, I want to kill you.
	And I know the names of your children.
	And I know where they go to school.
	I know the color of the van that picks them up.
	I know when they leave school.
	Oh, and by the way, your wife was buying Ding Dongs at the grocery store at this location at 3 o'clock yesterday.
	Make peace with your maker.
	You haven't got long to live.
	That is some pretty chilling stuff.
	Imagine that then you go to work and people have scattered bullets Around the lobby of where you work.
	Imagine that you get another letter saying that whoever sent it knows where your wife lives, and they're going to gut her with a knife like a deer.
	Well, my friends, that is what happens when you attempt to cut tiny little corners of government spending, particularly as it affects the public sector.
	This is what happened to Scott Walker in Wisconsin.
	He had to have guards with his children at school.
	His wife had to quit her job.
	He was constantly guarded with weaponry around the clock.
	He received countless death threats because some of them weren't even told.
	They weren't even informed to him.
	Only the most egregious were brought to his attention.
	The Office of Wisconsin Attorney General J.B. Van Hollen released over 100 pages of documents showing death threats made against Wisconsin lawmakers.
	If you attempt to take on government spending, particularly as it affects the public sector unions, this will be your life.
	This will be your life.
	Death threats, armed guards, threats not just against you, your wife, your children, but even out to your in-laws.
	You're going to have to tell everyone to lay low, to hide, to get armed, to get protection, to move.
	This is going to be your life.
	And what does Scott Walker do in Wisconsin?
	What was his egregious sin?
	Did he completely erase everybody's retirement packages?
	Did he send hard-working public sector workers to go and live under bridges in cardboard boxes or in a van down by the river on a steady diet of government cheese?
	No.
	He said, you've got to pay a little bit more for your health care.
	And by the way, When we negotiate, we're going to negotiate for salary in the present rather than pensions in 20 years from now because the people who are going to pay for those pensions aren't even voting yet.
	Some of them aren't even born.
	Would you do that for freedom?
	Would you take those death threats for freedom?
	I somehow doubt it a little bit.
	So let's have some empathy for the people who are going to face these death threats for reigning in government spending.
	This is Stefan Molyneux for the Peter Schiff Show.
	show.
	We will be back right after the break, and we're going to talk to Mark Skousel.
	We'll be right back.
	We'll be right back.
	You've heard of Karl Marx, right?
	Well now, meet his worst nightmare.
	This is The Peter Schiff Show.
	Hello everybody, Stefan Molyneux sitting in for Peter Schiff.
	Peter sends his apologies.
	He cannot make it this morning in a surprising career move.
	He's now actually working his way up.
	The Bantamweight Division of Mixed Martial Arts, strangely enough, in the all-female division.
	I leave it to your imagination to picture his costume and just pray he doesn't send you the gift.
	Anyway, I hope you're doing well this morning.
	We've got some great guests coming up.
	We've got Mark Skousen and Gerald Salente, who have brilliant stuff.
	To say about the economy and Obamacare and, you know, whether we're in a stock bubble for the 12 millionth time in human history.
	Max Gausen runs Freedom Fest, which is, I think, one of the most...
	I spoke there, I think, two years ago.
	And it's in Vegas.
	It's actually one of the few times that you're supposed to go to Vegas and remember stuff after you leave.
	So if you get a chance to check it out, it's well worth it.
	We're going to be talking a little bit about Obamacare.
	I know it's a topic that's been a lot in the news.
	It is really fascinating and horrifying to see.
	You know, one of the things about being a libertarian that is really kind of heartbreaking is how much you just hate, hate being right.
	You know, like if you've got a loved one and they keep smoking and smoking and smoking and smoking, man, you've got to quit that smoking.
	It's really bad for you.
	It's going to make you sick and so on.
	And then they call you up and they say, I got emphysema, I got lung cancer or something.
	You're like, oh man, I hate being right about that.
	And I find that kind of a daily experience.
	Like, so I run this podcast, Free Domain Radio, at freedomradio.com, and so I have to digest the news, which is sort of like eating a titanium fishbone sideways while in a bouncy castle.
	And I have to, if I didn't have to take that kind of bullet for the cause, I don't think I would.
	But reading the news is pretty wretched, because it all is just confirmation of how the initiation of the use of force, which is taxation, government regulation, you name it, violations of property rights, which is taxation, government regulation, you name it, how they always lead to disasters.
	Obamacare is one of these truly epic, Old Testament, starring Charlton Heston-style disaster with a budget of, I guess, trillions in the long run.
	And it is one of these events that hopefully is going to wake people up to the disasters of using centrally coercive authority to get anything done.
	There are about 19 million private policyholders in the United States who have obviously insurance policies with their healthcare providers.
	About 85% of them are not going to be grandfathered in.
	Eventually it's going to be 100%.
	So about 16 plus million people are going to have to renew their policies.
	And the sticker shock is truly astonishing for a lot of people.
	And do you know On the Obamacare website, again, don't go to the mainstream media.
	It's like going to Pravda for the truth about Stalin.
	Do you know, if a private company attempted to offer these kinds of policies, well, I mean, they would go to jail, and theoretically what they'd have to do, of course, is give a lot of campaign donations to politicians, like the financial industry did, in order to stay out of trouble.
	But when you go to Obamacare and you sign up, you are given a quote.
	Now if you're 50 or under, the quote you're given is for a 27-year-old.
	In other words, after You stop falling out of trees, but before teeth stop falling out of your head.
	You know, the young indestructibles whose policies are going to go up 95% to 98% under Obamacare because it's a direct wealth transfer.
	Because remember, it's really important before you have kids to pay for maternity benefits.
	It's also really important when you're in your 50s and the only child you're going to have is going to be the second coming to pay for maternity benefits because we have to pay for all the women who have kids without dads or with unreliable dads.
	So when you go to Obamacare, the website, and you put in your age, if you're 50 or under, you get a quote for a young, strapping, healthy 27-year-old.
	Prime of your life.
	Now, I'm 47.
	And I remember 27.
	And 27 is a little different from 47.
	Like the other day, I went to a trampoline castle fest, like the whole room is trampolines, and I'm bouncing around for like two hours with my daughter, seeing how high I can go.
	I could do that 27.
	When I was 27, it wouldn't matter at all.
	Now, my ribs feel like this old creaky accordion and I can't turn.
	Somebody says, like, hi, Steph, behind me, I kind of have to turn my whole body and slowly.
	I'm a little less limber.
	That's kind of what I'm trying to say.
	So you get a quote if you're 50 for a 27-year-old.
	Ah, but if you're over 50, do you know what quote you get?
	For a 51-year-old.
	Hmm.
	I wonder if they're digging the numbers at all.
	So that people...
	Because they'll give you a quote on Obamacare.
	If you're 70, they'll give you a quote for a 51-year-old.
	And then you go and apply for this from the actual company.
	And they will send you a bill that's way higher.
	Why?
	Because you're not 51!
	And you have to pay...
	For the actual age that you are.
	So even the figures that you're giving you on the Obamacare website are entirely deceptive.
	And you can't actually buy healthcare from the Obamacare website.
	Not implemented.
	May never be implemented.
	Not there.
	I mean, the whole thing is ridiculously illegal.
	I mean, you don't have to be Barack Obama, a constitutional scholar, to know That it's all nonsense.
	It's executive fiat.
	It is frankly more in line with the model of fascist government than it is with any republic.
	Why do I say that?
	I mean, the regulations were huge.
	First of all, President Obama said that he was going to broadcast all of the negotiations on C-SPAN. Did that happen?
	Well, no.
	As Otto von Bismarck said in the 19th century, there are two things that people, and you in particular, should not see being made.
	Number one, sausages.
	Number two, laws.
	Although sausages, no matter how badly made, are a little bit easier to digest, and at least you can get rid of them at some point.
	It may take a while, but you can't.
	But the legislation was not read by the people.
	It was not debated in public.
	As Pelosi said, we've got to pass the law so you can see what's in it.
	The regulations that have been added to Obamacare after the law has passed 11 million lines, 30 times longer than the initial legislation.
	Now, all of these regulations were added with no debate or approval from Congress.
	Well, the President doesn't have the ability to pass laws.
	That is reserved to Congress alone.
	Passing a legislation that nobody's read, that hasn't been debated in public, and then adding millions of lines of regulations after it has been passed that the law It's 30 times larger after it was passed.
	It's completely unconstitutional.
	Over 1,300 organizations are exempted from Obamacare.
	Well, there is a quaint little piece of paper called the Constitution that requires that everyone is treated equally under the law.
	So when you apply for exemptions, you break the legality of what is occurring.
	These are all very important considerations.
	Now there is, of course, the greed and the panic, the legitimate and understandable panic of people who are sick and they need health care, and health care has become ridiculously expensive.
	You may remember that Obama promised to lower health care premiums by $2,500 because he's magic, you see.
	He can just change economics.
	I'm waiting for him to repeal calculus to make math-impaired people like myself have a much easier time in high school.
	It would be great if he could reverse gravity.
	That would certainly beat dieting.
	He can't change math, can't change numbers.
	And healthcare premiums went up over $3,000 by the end of his first term, about $5,500 apart from what he promised.
	But we can't repeal reality with law.
	We'll be right back.
	This is Stefan Molyneux for Peter Schiff with Mark Skousen.
	Stay tuned.
	I didn't know just what to expect In Mexico She threw her arms away We now return to the Peter Schiff Show.
	Call in now.
	855-4SHIFT. That's 855-472-4433.
	The Peter Schiff Show.
	Good morning, everybody.
	Stefan Molyneux sitting in for Peter Schiff.
	Hope you're doing well.
	So we're going to talk to Mark Skousen.
	I'll give you a brief intro to the man, in case you don't know him.
	He's the author of over 25 nonfiction books, including, which I highly recommend, The Making of Modern Economics, The Lives and Ideas of the Great Thinkers.
	The reason for that is that if you know the lives Of the great economics thinkers, you are going to be an incredibly successful pickup artist because in bars with loud disco music, hearing about the early life of Ludwig von Mises, I mean, that's a sure thing.
	And at dinner parties, you'll have lots of elbow room because people will clear.
	So, Mark, are you on the line?
	Yes, I'm with you.
	That's a very strange endorsement of my book.
	I try to appeal to the young.
	What's funny is that the making of modern economics was really the first attempt to make this subject lively and bring the economists, you know, red-blooded individuals who actually had lives that were worth discussing, whether it's Karl Marx or Milton Friedman or what have you, and I actually have pictures and all kinds of things in this book, music to listen by.
	It's really a lot of fun with clever titles, like for the Austrian school, a chapter, it's called Out of the Blue Danube, which I think is kind of clever.
	Wait, wait.
	Out of the Blue Danube.
	Let me see if I can take a big guess as to what piece of music you will be playing at that point.
	Anyway.
	So thanks so much for taking the time this morning.
	Yeah, absolutely.
	Absolutely.
	And get your spaceships floating.
	All right.
	Ask your parents if you're under 30 once more.
	Anyway, so Mark, thanks for taking the time this morning.
	So you sent an article in that I think was interesting.
	We'll talk about it a little bit.
	About how almost nobody is actually paying for Obamacare, which, again, is one of these things that you think might be discussed a little bit more in the mainstream media, but everybody crosses their fingers and hopes that violence is going to somehow work in solving complex problems like the provision of healthcare.
	What do you think is going on?
	What's going to happen in January when people don't actually have healthcare?
	Well, actually, I think it's going to be just a great thing.
	I think people are wringing their hands way too much over this.
	I personally think the best thing, the silver lining that's coming out of this, is that people will realize that they cannot depend on the government or even their doctor, frankly, to maintain their health.
	And alternative medicine and exercise and people taking...
	Taking responsibility for their own lives to make sure they live healthy, because if you get involved in this system where you have to depend on the government, when you have to depend on insurance companies, you're in hot water.
	So the positive aspect of this, I think, is really quite enlightening, where people will Finally take their own personal responsibility for their health situation and not depend on third parties.
	So that's my take.
	Well, of course, studies show fairly clearly that about 70% of people's health issues are what is euphemistically called lifestyle-related, which is usually couch and Doritos related.
	But the other thing I think that's quite interesting, which is everybody says, well, you know, we've got to provide health care.
	Government needs to do health care.
	I don't know if you've read these studies where If you are on government healthcare, your health outcomes are worse than if you have no insurance or government healthcare at all.
	Have you heard about that stuff at all?
	It's mind-blowing.
	No, but I'd like to see it.
	It just kind of confirms what I've just been saying, that there is this positive aspect that we've overlooked with this as everybody wrings their hands.
	How am I going to get my insurance and that sort of thing?
	You know, most young people don't even bother with health insurance because they don't think they're going to die.
	They don't think they're going to get a serious disease.
	And, of course, a small percentage do.
	But, you know, we do have some serious problems here.
	One of the things that really bothers me about the whole health care system, and John Mackey, the CEO of Whole Foods, is saying, is really in the forefront of this criticism and that is that big pharma and the government and so on, they focus on cures rather than prevention.
	They don't want to focus on a healthy lifestyle, they want to focus on if you get sick, what can we do to have a quick fix, pop a pill or two, have some surgery and we're going to solve your problem.
	We need to move away from that model, and Mackey is really in the forefront here.
	He's one of our big names that we're having at our big Freedom Fest conference that Peter Schiff and all the other people come to, and he does this wellness.
	His service, all of his employees can take advantage of this wellness program And it's been very successful in reducing weight and reducing the number of times going to the doctor.
	People are a lot healthier.
	And he gives a talk on this, how to live to be 100 without getting heart disease and strokes and cancer and diabetes, which are the big four problems that we face in our country.
	And we're just not addressing that.
	The only thing we're addressing is Well, people need insurance.
	Well, having insurance, is that really the health-style direction our country wants to head?
	Because that just encourages people to live the unhealthy lives that people do all the time instead of changing their patterns to reduce their weight.
	They feel better about themselves if they exercise and then get involved in sports activities and aerobics and yoga and so forth.
	Yeah, there's a great system that used to be the case in China.
	I don't know what happened when the communists took over, probably got blown away.
	You used to pay your doctor every month until you got sick, and then he had to treat you for free.
	So his massive incentive was to keep you as healthy as humanly possible, and that's really how How things should work, I think, ideally, because there is this kind of weird thing where people say, well, if I get sick, there'll be some drug, there'll be some treatment, there'll be something.
	Like, I think Tom Hanks just got diabetes, or just admitted that he had diabetes, and his doctor said, well, all you have to do to prevent it is to get your weight down to what you were in high school.
	And he's like, well, I don't think that's going to happen, so load me up with medication.
	And that's really tragic.
	Of course, he can afford it, but for the majority of people, the social cost is enormous.
	Listen, Tom, Tom Hanks, didn't he die in Saving Private Ryan?
	I thought he was dead.
	Well, he seems to have made a remarkable recovery.
	And, you know, the Oscar can often bring dead actors back to life.
	They'll come in their zombie costume to pick up the statue.
	Yeah, possibly, possibly.
	I'm sure he's for national health insurance.
	Now, let's talk a little bit about gross output, which sounds like something you'd scrape off the bottom of a bathroom in a frat house, but is actually, I think, a better measure that you're working on to measure gross domestic product.
	As I mentioned in the show yesterday, gross domestic product is if you get sick, somehow society records that as wealth because you're paying a doctor.
	What's wrong with GDP and how can we sort of fix it so we can really get a more realistic view of what's going on in the economy?
	Well, I'm glad you brought this up because gross output is something your listeners probably are not familiar with, but it is a brand new statistic that the government is going to release probably starting in April, and they're going to do it right alongside with GDP. So it's going to be a point of comparison.
	And GDP, the problem with GDP, Is that it focuses too much on the consumer side of the economy rather than the production side.
	So you get these comments all the time looking at GDP, that consumer spending drives the economy, that government spending drives the economy, because those are the two biggest sectors of GDP, and business investment is a poor third.
	And so the focus is always on consumption and government spending.
	With gross output, it's actually a measure of spending at all stages of production.
	So it's really more reflection of the producer side, the make side of the economy.
	And it's really quite interesting.
	It's almost double GDP. It is more volatile.
	It's more sensitive to the business cycle.
	And what's really interesting is that you see that the business sector is really the biggest part of the economy.
	The number of stages that you have to go through for all of these products to be produced is truly quite miraculous.
	So gross output is this new statistic that's coming out.
	It's something that I predicted, that I recommended way back in 1990 when I wrote another book called The Structure of Production.
	So people can read this article to try to make sense of it if they just...
	Google gross output Forbes magazine.
	It will pop right up and they'll take a look at it.
	I've had about 10,000 people see this article that just came out a couple weeks ago.
	So it's really a big deal.
	And I think it's going to revolutionize the way people view the economy to look just at the, not just the use or consumer side of the economy, but the production side, which is far more Interesting.
	I mean, that's where the entrepreneurship, that's where the technology, the creativity takes place.
	And how does the economic view of the U.S. look over the last couple of years using gross output rather than GDP? What changes in our perception of it?
	That's a really interesting point because I have a chart in this Forbes article That shows what exactly happened.
	So what happens is, let's go back to the 2008-2009 crisis.
	GDP dropped 2%.
	And the reason it dropped so small by such a small amount is because government was spending like crazy, and of course that's a big section of GDP. Gross output, on the other hand, fell by 7 or 8%.
	It fell dramatically.
	So this is more of a reflection of the early stages of production.
	Now, during the recovery stage for the last five years, gross output's actually been growing faster than GDP. So, like I say, things are more sensitive in the GDP statistics.
	It hasn't really trickled down to the job sector of the market, but it does indicate a very strong recovery.
	And I'll be very interested to see if this recovery continues When these statistics, when this gross output statistic comes out in April of next year, so we'll get a sense of, I think it's a pretty good indicator of where we're headed.
	So if gross output flattens out or actually starts to decline, that would be a bad sign.
	Yeah, and it seems to sort of fall in line with the Austrian view of how recessions and all of that work, which is that you get missed signals for entrepreneurs based upon manipulation of money supply and interest rates, which causes industrial output to increase, and then it turns out that that's malinvestment.
	We've got a break in a sec, but I'd really like you to stick around because I really want people to understand What is going on with the business-to-business economy?
	It's like the sewage system.
	You only see the tap, but it doesn't work so well without the pipes.
	We really need to understand this as people who work in the economy.
	We're going to take a short break.
	This is Tevan Molyneux for Peter Schiff.
	Jeff, we'll be right back with Mark Skousen.
	Since the Peter Schiff show was last on the air, the national debt added another $7.89 million.
	Luckily, Peter's intelligence is growing twice as fast.
	That's incredible!
	Welcome back to your source of sanity in an insane world.
	It's The Peter Schiff Show.
	Hello, everybody.
	Stefan Molyneux sitting in for Peter Schiff.
	We've got Mark Skousen on the line, and we're talking about the business-to-business economy to some degree.
	For those who don't know, I had a former life as a software entrepreneur and executive and I worked for about 15 years in the B2B market.
	I was working with environmental software.
	And it's huge.
	It's a huge market.
	Now, the consumer doesn't really see it, but it is really where economic growth occurs.
	Economic growth is going to occur to some degree when you buy stuff, but it's not buying stuff that is really important.
	It's the saving, it's the investment, it's the capital improvements, it's the investments in human capital.
	And unfortunately, with our sort of GDP consumer-driven economy that results really from the democratic system we have at the moment, there's a real distortion in that consumption is favored because that buys votes.
	And investment, which is the deferral of consumption and hopefully improvements of productive capacities, is deferred.
	And this is occurring all over the world, that we're eating the future to feed the present.
	And this happens in terms of consuming capital, the government taking a bunch of capital out of the equation for the sake of buying up its bonds.
	I think the Fed has bought more bonds in Two years than China bought in the last 20, but there's also youth unemployment that's huge around the world.
	Got a couple of statistics here, starting from the worst.
	Youth unemployment over 60% throughout most of Africa, 50 to 59% in places like Croatia, Greece, Spain and Tunisia, 40 to 49% in Cyprus and Italy.
	30-39% in Portugal and Slovakia and so on.
	And I sort of view youth unemployment as really a retardation of the growth of human capital.
	It takes a long time to develop good business skills, good negotiation skills, good client management skills, good sales skills, whatever it is that you're going to be doing.
	And it seems that this youth unemployment and generally consuming the future for the sake of the present I think is a big problem.
	What do you think of these statistics and this analysis?
	Yeah, you know, I think that this is one of the biggest mistakes that is made in the whole policy issue, that whatever we need to do, we just need to stimulate more consumption.
	And that includes, it doesn't matter that these kids are unemployed or even that the people who are on food stamps, because that's increasing purchasing power.
	If we doubled the minimum wage law, this would be good because it would put more money into the pockets of consumers, which drives the economy.
	And so this is all very good.
	But like you say, nobody is learning any skills from this.
	Nobody is developing new products.
	Nobody is developing what we need in the future.
	You're not developing skills, and you're certainly not improving your personal self-esteem by just having your hand out.
	And this is one of the most pernicious myths that is perpetuated.
	I just saw it the other day on MSNBC, where they had a so-called expert saying that the raise in the minimum wage was really good for For people working poor because it would put more money into the economy.
	Well, what do you think?
	It's also taking money out of the economy because the costs of doing business are going up.
	So it really is a very poor example, poor economics.
	And I have to say, I get really frustrated.
	I talk to all of my free-market economists.
	Who are preaching the sound principles of sound economics to thousands of students every year, and it doesn't make a bit of difference.
	We don't make a dent whatsoever in the intelligent thinking.
	I mean, the level of ignorance is so high among the media and among Economists who should know better, I just scratch my head saying, maybe I need to go into another profession.
	Well, look, I mean, it is this burning the future for the sake of the present is sort of related to the healthcare thing as well.
	And as Murray Rothbard said, you know, it's no sin to be ignorant of economics, but please stop talking about it.
	You know, this is something that drives me nuts.
	Like I was reading about Nelson Mandela and, you know, he was like, I got all the communists and all these socialist policies, nationalization and so on.
	And then when confronted with the details of how this might work, he says, well, I'm not, you know, I don't really know much about economics.
	It's like, well, then stop talking about economic plans.
	But you can't get people to shut up about things they're ignorant of.
	It seems to be a basic facet of human existence.
	Now, you've also mentioned that you...
	I wonder on the Nelson Mandela story, if not like Martin Luther King, where we just kind of ignore...
	There are misconceptions in economics and kind of their Marxist background, and we just put them up as these big heroic figures for good things that they did as far as breaking down racial problems and so forth.
	But why is it that all of these guys have to adopt such anti-market views?
	I think it's really a great tragedy when we put up our heroes of Nelson Mandela and Martin Luther King, Jr., Who both were very strong in favor of government intervention in the economy.
	We need a hero in the black community who favors free market views, and I guess we have Walt Williams and Thomas Sowell, but that's about it, isn't it?
	Well, I think there is this tragedy which free market economists, I don't think, have done a good enough job separating capitalism from crapitalism.
	Crapitalism is all of the rent-seeking behaviors that corporations necessarily must engage in to satisfy shareholders and board members.
	It's when you use government power.
	And, of course, they consume or they confuse Mercantilism with the free market, imperialism or colonialism with the free market, and then they say, well, there are all these corporations here who own a bunch of stuff.
	That's capitalism.
	I don't want that, so I'm going to go to the opposite of capitalism.
	Ooh, that's Marxism!
	And it is really, I think, just a failure to differentiate rent-seeking from genuine profits or the spoils of state power with engaging in the free market.
	I think my view is, again, along with John Mackey, if I may quote him again at Whole Foods, He believes that capitalism needs a new brand, and he's providing it.
	And I would argue, and this is the whole point I tell people about minimum wage laws and so on, there are market solutions to higher wages that are genuine and are permanently higher, and it comes through productivity.
	I tell people all the time, do you realize that people who work for high-profit companies, like Microsoft or Apple and so on, They get paid much higher wages.
	And so the key is to work for higher productive, higher profit-oriented companies.
	I mean, there were secretaries who worked for Microsoft because they got stock options.
	They retired as millionaires.
	And we can see this happen again if we just increase the productivity or the profitability of companies and make workers more profitable.
	I agree.
	I agree.
	I'm sorry, Mark.
	We don't even have a soft break coming up.
	Appreciate your time.
	We will be back with Gerald Salente.
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	Hello, hello, everybody.
	Stefan Molyneux sitting in for Peter Schiff.
	I really, really need you to move someplace sunny right by the window.
	Look straight into the light.
	We're about to have Gerald Salente on the show, and he can turn out the sun with a rational evaluation of our economic situation.
	Just wanted to mention briefly, we were going to talk about it in the last segment with Mark Skousen, Global Financial Summit.
	You might want to check it out, freedomfest.com forward slash GFS. Now, it is going to be in the Bahamas, and it is very important to try and find a way to take a bullet for the cause and get to the Bahamas in February, February 5th to 8th, 2014.
	So I hope you'll check.
	That out.
	And Gerald, are you on the line?
	Sorry, let me just give you a brief intro.
	Let me pretend I'm professional.
	And Gerald, of course, runs a well-respected trends research.
	And it's really, really important that you check out his work.
	He's been right, I think, with fairly consistent accuracy about the effects of growing state power on the economy and your future, trendsjournal.com.
	Gerald, are you on the line?
	I'm here, Stephan.
	How are you, my friend?
	Very well, thank you.
	Okay, so I know that you're a macro guy.
	I certainly don't mind dipping into the micro planet, but...
	Where are we in the economy?
	Inflation doesn't seem to have hit with money printing.
	Gold remains kind of low.
	A lot of the predictions of people on the libertarian side of things, I know you call yourself a political atheist, but where is this stuff panning out?
	It seems that there's been a kind of miscalculation on the part of some people who are suggesting investments and so on with gold and with inflation and so on.
	So if you think there's a drift from predictions, where do you think it's happening and why?
	Well, let's take a look at what's going on, for example.
	You know, this is, as you said, a macro issue, and it's a global economy.
	Look what's going on in India today.
	The numbers just came out.
	Consumer inflation went up 11.24%.
	And what have they done in India?
	I mean, the Indians like gold as much as curry, you know, and they can't buy it anymore because the government has put on so many restrictions.
	So many taxes, so many penalties.
	It's the biggest black market item in the country right now.
	So it depends where you are.
	So, for example, let's look in the United States.
	Well, you know, I was never, by the way, one of the people that said it would be hyperinflation in the U.S. I kept saying it would be a devaluation of the currency, and it would cost you more to buy things.
	Which is different in the sense that it's not a supply and demand issue where the price of things are going up because of inflation.
	They're going up because the value of your currency is declining.
	And that's what I believe is still going to happen.
	So, On the overall level, and again, look at what's going to happen today.
	We just saw the numbers come out.
	I'm sorry, Gerald, to interrupt.
	We're just going to call you back in just a second.
	We've just got a really crackly connection.
	Sometimes the NSA, what they do is they drum their fingers on the table when our callers come in.
	I mean, they're not supposed to, of course, but they do sometimes when they listen in on these things.
	We'll get you back in just a second.
	I think that this question of inflation is interesting because it has been a long time since there's been a world reserve currency.
	I guess the British pound was the last one.
	It's been a long time since there's been a world reserve currency as widely accepted and adopted in the world as the United States dollar.
	There are actually more dollars circulating in Russia than there are in America as far as that goes.
	So that is propping up a lot of the U.S. value.
	And, of course, there is still A lot of economic strength in the United States.
	A lot of innovation comes out of the United States in the healthcare field, in the technology field.
	So I think that's propping up the U.S. dollar.
	Gerald, do we have you back?
	I'm back.
	Okay, so as I was saying, you know, so look what's happened, for example.
	The yuan, the Chinese currency, has increased dramatically over the last four years.
	Just this year, it was up about another 2.5%.
	Deutsche Bank's expecting it to go up Again, next year, by another 2 or 3 percent against the dollar.
	So you can see where these trends are leading.
	And as I see it, here's our forecast, by the way, for 2014 on the economic front.
	And we're just coming out with the top trends for 2014 for the Trends Journal within a couple of days.
	So this is kind of like a scoop.
	We believe there's going to be tapering.
	And whether it happens later this month or early or mid-January, it's going to be one of those times, we believe.
	It'll be a little bit of tapering.
	And what's going to happen when that happens, you're going to start seeing the world equity markets go into panic.
	Because the only way that's keeping this Ponzi scheme going is by the central banks, led by the United States, pumping all of these trillions of dollars' worth of digital money Not worth the paper.
	It's not printed on into the system.
	So all of the, I mentioned India before, all of these brick nations, the emerging markets, they've been growing because of the hot money flowing out of the United States primarily because of the low interest rates and into these countries.
	So now you're seeing that the money flow has stopped.
	And now, for example, I mentioned India before, you watch, they're going to raise interest rates again.
	Okay, so I get it.
	Your country's going into recession.
	Your inflation numbers are skyrocketing, so you have to slow it down by raising inflation.
	Oh, that'll make your recession really nice, won't it?
	It'll turn it into a depression.
	So now, going back to the entire scheme of what's going to happen, we believe that when they announce the tapering and begin to do it, it's going to cause panic.
	And then they're going to...
	Ease up again and start printing money.
	That's the only way this economy keeps going.
	The facts are in front of everyone.
	So that when they start pumping again, that's when you're going to see the big gold spike.
	Gold's down now, as we speak, about $28.
	If the numbers came out with terrible, terrible new claims for unemployment.
	And so the whole thing is rigged.
	And again, is it rigged?
	No.
	They're rigging the LIBOR rate.
	They're rigging the Forex.
	You know, no, no, no, but they would never rig this.
	So it's not in the interest of the central bankers to have gold prices go up.
	Or if you're in India, and they love gold more than any other country...
	To have the people buy it.
	So you can see what's going on.
	Well, and one of the things...
	We're going to take a break in a minute or so.
	One of the things I think that's kind of misunderstood...
	Among people who aren't economy geeks like us, is the degree to which when companies jig with interest rates, when they jig with money supply, it creates massive malinvestment.
	It sounds like a really dull term, but it's really important for people to understand.
	It sends the wrong signals to entrepreneurs.
	It sends the wrong signals to business executives.
	It sends the wrong signals to the youth in terms of what they study and what they learn and the skills that they acquire.
	And when the sea changes, when the interest rates change, when the money supply changes or contracts or even expands, fundamental changes occur in the economy.
	Think of how much money and time and effort and skills were wasted building this massive stock of U.S. housing, 10% of which is now uninhabited.
	So we're going to take a short break.
	We're going to come back after the break and we're going to talk about the effects of this kind of malinvestment and how painful, how agonizing it can be for a society to shift resources to what the free market wants rather than what the central planners in the central banks think is best.
	For everyone, this is Stefan Molyneux.
	For Peter Schiff, we will be right back with Gerald Salente.
	The Peter Schiff Show.
	If knowledge is power, then the Peter Schiff Show is a uranium-enriched 10,000-megawatt nuclear reactor.
	Stay plugged in.
	Stay brilliant.
	This is the Peter Schiff Show.
	Well, I guess it will be tomorrow.
	Today, I'm sitting in for Peter Schiff.
	This is Stefan Molyneux from Free Domain Radio.
	We've got Gerald Salente on the line, and we're talking about how governments mess up interest rates, mess up money supply, and that causes entrepreneurs, companies, and even young people in terms of their education to malinvest, to go into the wrong areas because they're getting the wrong signals.
	It's a great quote from Friedrich Nietzsche, the man who had a mustache big enough to qualify as two Arkansas ditched caterpillars stapled to his cheek.
	And he said, give a man a why and he can bear almost any how.
	Give a man a why and he can bear almost any how.
	If we know what our sacrifices are for, we are able to make them.
	There is going to be sacrifice in transitioning from all of this central planning to something more rational, to something more free, to something more voluntary.
	Do you think people are even close to understanding, Gerald, what is necessary to change things from where they're heading?
	No.
	I think there are, I mean, the people, obviously, that are listening now, yes, and the people, you know, that tune into, you know, Peter Schiff's work and mine and others, but for the majority, no.
	They still put their trust in the two-headed, one-party system.
	You know, it's kind of like, for example, I'm hearing, you know, about this Elizabeth Warren, you know, does she have a shot at the presidency or, you know, whatever the party is.
	I mean, what are you going to put?
	It's the mafia.
	What is one person going to make the difference?
	They're corrupt organizations.
	I think if you're going to look to see where the change is starting to happen, you have to look to Europe.
	And whether it's in the Czech Republic, whether it's in the Netherlands, or in Italy.
	I mean, what's going on in Italy now, everyone should be paying attention to if you want to see a new model.
	And that's that whole pitchfork movement, the pitchfork protests, And they call it pitchforks because it began with Sicilian farmers.
	But they're storming every major city right now in Italy.
	And the police, as a matter of fact, they took off their helmets and put down their shields in support of the people because they all feel the pain.
	Wait a second.
	Sorry to interrupt you for just a moment, Gerald.
	Are you saying that people in Sicily have some idea how to fight the Mafia?
	I can see that making a lot of sense, actually.
	It's not only Sicily, it's, you know, the entire country.
	It's a mafia over here.
	They just dress differently and speak differently.
	They call themselves Republicans and Democrats as they do all these dirty deals.
	Oh, and they don't call it bribes or payoffs.
	No, let's call it, I've got a better name.
	How about campaign contributions?
	You know, look at what's going on now with this defense, with the moronic crap going on.
	Well, they just built an aircraft carrier for $13 billion.
	How many of their buddies made money on that?
	You know, and go on the list.
	Go on down the list.
	Oh, with this new budget cuts.
	Yeah, the Pentagon gets another $22 billion.
	Yeah, just what we need.
	It's a mafia everywhere.
	But going back to Italy, it's a model to look at as well as in the Czech Republic and other places.
	They want to do away with the ruling governments.
	That's the only way it's going to happen, as I see it.
	You're not going to get changed from a corrupt system.
	No, and I agree with that.
	I think a blank page is kind of what we need for the future.
	And this is what is so frustrating.
	We, and I sort of use this very collective concept, but sort of we in the West used to be made of some pretty stern stuff.
	You know, we took on fascism, national socialism, and communism, and the theocracy of the Middle Ages.
	We used to be pretty good at fighting bad guys.
	And now it just seems like our entire spines have been drained out through what's left of our wallets, and we've been used to the slow morphine drip of government subsidies and government controls, and we have sold the future of our freedom for Obama phones.
	And it really is quite frustrating how little fight there seems to be left in our culture.
	Oh yeah, I agree with you.
	There's very little fight.
	Again, it's the small group, but that's all it takes is a small group.
	And I call it a 20% solution.
	I mean, look at the revolution that happened in America.
	It began with a handful of people.
	And even at the height of the revolution, you know, I think only about 40 percent supported it.
	And, you know, it can happen.
	Matter of fact, one of the top trends that we're looking at now is called Wake Up Call.
	And it's about this populist movements going on around the world.
	And it's an overthrowing of the government and replacing them with truly democratic processes that don't exist.
	And by the way, one of the things that's making it work in Italy is that, and it's freaking them out too, and that is that the people like Beppe Grillo from the Five Star Movement and others, they're calling on the security forces to stop protecting the politicians And the institutions.
	Now that'll freak them out.
	And that's what's stopping it, by the way.
	What's stopping it are the police in this country.
	The militarization of America.
	Look what's going on with the Super Bowl over here in New York.
	They're turning the place into a militarized zone.
	You know, they've got high security all throughout Manhattan.
	What is this?
	It's a damn football game.
	I don't know how the terrorists always strike on Super Sunday, I tell you.
	I mean, who's making this crap up?
	It's fear and hysteria.
	It's the police in this country that are stopping freedom from happening.
	Well, and with all of the militarization, I mean, you have small towns in Utah buying armored personnel carriers.
	I mean, are they expecting beers to fight back?
	Yeah, we got them right here, in Albany.
	So it's going on.
	This is what has to happen.
	Look, how can the United States move into any direction that's going to be of the benefit when you see immorality at the top?
	Whether it's bush-lying us into the wars in Iraq and Afghanistan.
	In Afghanistan, you remember, I'm going to say, I'll tell you, he has the weapons of mass destruction and ties to, okay, Lysaw, colon, Powell, colon, the perfect name for him, man.
	That's exactly where it leads to.
	They lie us into war.
	How about Obama?
	I'll tell you what I'm going to do as I'm campaigning.
	We're going to be out of Afghanistan by 2014, I tell you.
	And I'll make it 2024.
	I got a number wrong.
	Every one of them are liars.
	Every one of them are criminal operations.
	How could there be any morality?
	The fish rots in the head down.
	There's silence in this country about the atrocities being committed.
	Look what's going on with that release that just came out by Seymour Hersh, showing the big lie about how Syria was using the sarin gas.
	Not one of the major media picked the story up.
	The prostitutes avoided it.
	And do you know why?
	Of course you know why.
	The reason that Obama pulled a bunch of troops out of Iraq had nothing to do with any campaign promises, nothing to do with him remembering that he may have got some sort of peace prize, which I'm sure he wears around his neck when he orders drone strikes on civilians.
	The reason that he pulled his troops out of Iraq was because the Iraqi government had decided to no longer exempt the troops from law.
	In other words, if they killed, they were going to get prosecuted.
	If they committed atrocities, they were going to get prosecuted.
	And suddenly it's like, oh, the rule of law now applies to the troops?
	We are out of here.
	It's incredibly frustrating.
	This is what I'm saying to you.
	It's immorality at the top.
	So how could we have a nation that's going to go in a positive way when this kind of behavior is sanctioned?
	I read Obama's speech Yesterday, the one that he gave the other day, right yesterday, that he gave at the Mandela Memorial.
	Yeah, I wanted to puke.
	It was filled with hypocrisies, talking about freedom and democracy as they, you know, oh, by the way, anybody, you know, the NSA is listening in on everybody, and they're probably listening in on now, right as we're talking.
	Because they're watching and listening all over, whether it's the local police, the CIA, the FBI, the NSA. Oh, Gerald, you're breaking my heart.
	Hopefully we'll get you back on.
	Please call 855-4SHIFT. We're going to talk to you after the break.
	This is Stefan Molyneux for Peter Schiff.
	We now return to the Peter Schiff Show.
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	855-4SHIFT, 855-472-4433.
	We have managed to trap Gerald Salente in the Peter Schiff dungeon of infinite talking.
	So, I'm sorry, you were right in the middle of a rant, and as we all know, rantus interruptus is one of the most painful conditions.
	Keep going, my friend.
	Yeah, you know, this whole thing about, you know, everybody, who are these people that are listening to us?
	Who are they?
	What private contractors are we paying to the tune of $80 billion a year?
	Don't bail out Detroit.
	There's no money for anything.
	Look at the crummy rail systems we have in this country.
	Look what just happened in New York a couple of weeks ago.
	So there's no money, but we're paying all...
	Who are these people that are listening?
	So knowing that I was going to be on your show, my friend Frankie from Canarsie asked me to ask the NSA or CIA or local police that are listening in, he wants to know if their mother is still preferring to have sex with German shepherds.
	So for all you CIA guys and NSA guys, my friend Frankie wants to know that.
	I mean, who are these people that are listening to us?
	Who are they?
	Who anointed them?
	To be our overseers.
	And it's happening throughout this nation.
	At every level, our freedoms are being robbed.
	And the people just keep taking it.
	And then when they say things like, calm down.
	Speak politely.
	You know, take it as an adult.
	Become a slave in Slavelandia.
	Know your place.
	It is tragic.
	The only thing that I can say, the only positive thing that I can get out of that speech, which I agree with, is that it is nice for the actual German Shepherds to get some, because otherwise, you know, given that they live in Germany, all they have left is sheep.
	So it's nice that someone's mom's being thrown into the mix for those guys.
	Well, every time I begin my conversations with everyone, I always begin it with asking the fellow or woman that's listening in, what's going on in their lives?
	It's always been interesting to me.
	Why would you want to control, to monitor, to eavesdrop?
	I don't know if you know this story.
	Before the financial crash in 2008, there was a little group of people called the SEC, Securities and Exchange Commission, and they were, of course, charged with making sure that people acted honorably and forthrightly and ethically in financial dealings.
	And as it turned out, the significant proportion of the senior executives at the NSA were spending about eight hours a day surfing porn.
	They found this through the logs on the computers.
	Some of them even put together PowerPoint presentations with porn images and videos in them.
	Now, I mean, eight hours of porn, if you've got that kind of endurance, go catch a few bankers.
	Certainly you're going to have a very strong handshake after that.
	But this is what these people are doing.
	It's completely insane.
	I know, and then here's a great little story today in the Financial Times.
	J.P. Morgan set to settle Madoff claims.
	Jamie Dimon, chief executive of J.P. Morgan Chase, signaled the bank plan to pay penalties over allegations that it failed to notify U.S. authorities of its concerns that Bernard Madoff was running a Ponzi scheme.
	I love it.
	I love it.
	They failed Failed to notify.
	Yeah, they wanted to keep the dirty deal going.
	How about that?
	And the other language, nobody ever does anything wrong.
	They misled or missold.
	It's never grand larceny.
	You know, so the word justice is just us.
	J-U-S-B-U-S. They're spelling it wrong.
	Right.
	Right.
	And there were mathematicians.
	There was a 60 Minutes.
	The mathematician had basically figured out that there was a complete Ponzi scheme and kept sending letters to the SEC and to congresspeople, to regulators, saying, mathematically, what this guy is promising is utterly impossible.
	It is a Ponzi scheme.
	Go get him.
	And they're like, yeah, we'll be right on that.
	But first of all, I've got a little bit more porn surfing to do, but I'll get right on that.
	And then, of course, they just fall asleep.
	So it is tragic.
	Or else they're busting the chops of us, the little people, for every minor infraction that we make.
	We're going to enforce the letter of the law, but hey, has anybody seen one head roll on Wall Street?
	And what has J.P. Morgan Chase paid this year in fines and penalties?
	What, about $16 billion?
	But nobody did anything wrong.
	It was just, you know...
	I forgot to dot the I and cross the T. Sorry we won't do it again.
	But we neither admit nor deny any wrongdoing.
	Well, and there's no...
	I mean, when people, they have this...
	We have this weird mentality where, well, at least J.P. Morgan had to pay all those fines.
	There is no such thing as J.P. Morgan.
	It is a legal fiction.
	It is a legal shield for the rich that grants them immunity from, basically, the crimes that they commit.
	And people think that we're levering a fine on them, it's going to cost them.
	No!
	What do they do?
	They don't give people as many raises.
	They don't hire as many people.
	They give less proceeds to their customers.
	All it does is spread the pain out.
	It's not like the houses of the rich get taken away when a fine gets levied on their corporation.
	It's the legal shield.
	It's all the little people, all the customers, all the employees who pay.
	And this is the opposite of any kind of justice that would be provided by any common law system.
	And you know why?
	It's because of what you were saying about how all the young people are learning the wrong way now.
	They're being taught economics and other policies that no longer exist.
	Because this is no longer a capitalistic system.
	And four words killed it.
	Too big to fail.
	Oh, you saw the great news the other day.
	Oh, General Motors, the United States, finally sold the last of its stock, and we, the taxpayer, took...
	Approximately a $10 billion plus hit.
	But be that as it may, we save jobs.
	But anyway, the fact of the matter is there is no capitalism in the United States.
	Those four words prove it.
	It's fascism.
	It's the merger of state and corporate powers.
	It's in front of everybody.
	This is not you talking about entrepreneurs.
	What entrepreneurs?
	It's multinationalization.
	They've taken over and virtually...
	You know, look what's going on.
	I love what's going over in the Ukraine.
	They had Russian television over here interviewing me last Saturday.
	Not RT, but the one out of Moscow.
	And I said, oh yeah, they should be breaking, you know, they should be doing everything they can to join the European Union.
	I guess they want to be just like those Greeks, right?
	Hey, how about 40% unemployment in Italy?
	Fight to get into the European Union.
	You could become a Spaniard or a Portuguese or Irish.
	Yeah, you could have nothing.
	They could tax you.
	They could rape you.
	They could rob you.
	Fight to join the European Union.
	This is not capitalism.
	It's fascism.
	We were just talking about the NSA. We were just talking about the militarization of the police force in the United States.
	Look what's going on with all the rape and robbery coming from the major banks and financial institutions with nobody doing any time.
	Well, you and I slip one digit on our tax return and we can live in fear of the tax collection agencies.
	Greece can live falsify records to get into the European Union and nobody suffers anything.
	In fact, they get heavily rewarded by getting lower interest rates than they would have if their own basket case economy had been exposed to the free market.
	But let me ask you a question.
	Okay, let me ask you a question because Lord knows we can do this all day and end up with no spleen juice left at all.
	But if there was one, you wrote recently about, you know, we may live in a nation of cowards.
	And if there was one virtue that you would like to inject into the citizens around you to turn this thing around, what's the one virtue do you think is the most missing to restrain these predators?
	It's courage and dignity.
	You know, the motto of the Trends Research Institute, taught to me by my father, I mean, so rest in peace.
	I'd be talking away.
	He'd look at me in an Italian and he'd say, Papagallo, parrot.
	Stop repeating what everybody else is saying and think for yourself.
	And so, to me, it's, you know, I don't tell anybody what to believe.
	This is the way I see it.
	Knock yourself out.
	You see it the way you want to see it.
	But don't tell me I have to believe your way.
	And when I talk about courage, that's what it is.
	It's courage and dignity.
	The courage that you are your own person and the dignity to respect yourself and not bow down, look up to, or fawn over celebrities or politicians or anybody else.
	And so to me it's dignity and courage.
	And until those elements are brought back into the human spirit, we're not going to see it.
	And when I talk about dignity and courage, look at the way people dress.
	We used to say they look like caffons.
	Look at the slobs that people have become.
	Look at how they present themselves.
	Look when you go out.
	Look at what's going on.
	So to me, those things have to be restored.
	And I always say, how's it going to change?
	And when people get healthy, physically, emotionally, and spiritually, and I'm not talking about airy-fairy spiritual stuff.
	I'm talking about finding a truth within oneself.
	And until those things change, I don't see anything changing.
	And when those things change, when enough people change within themselves, it's the hundredth monkey syndrome.
	It all starts changing.
	Well, I certainly agree with you.
	I don't mean to sound like an old fart, but I probably am.
	When I see kids with their...
	I shouldn't need to see your underwear unless you're actually in a car accident and they had to cut your pants off.
	I shouldn't need to see any of that stuff.
	Your underwear is there to protect...
	Your pants from your ass.
	And for no, it's not decoration.
	It doesn't make you cool.
	Just pull your pants up, turn your cap around, and perhaps try and seek gainful employment.
	Again, this is one of the things that when I was young, you worked.
	I had three jobs when I was a kid.
	I liked to work.
	It gave me a lot of skills in life.
	And I sympathize.
	Youth unemployment, it's tougher to get ahead in many ways now, but...
	I just wish that people would sort of wake up to this kind of stuff and discover the necessary virtues for a civil society.
	We can't have the government replace that.
	Exactly.
	And you know, and people say, you know, by the way, I get letters as Peter does all the time.
	And people thank me for saying this, by the way.
	They're from young guys.
	You know, they say, Mr.
	Salenti, I see you.
	You know, you're always, you know, you talk the talk.
	You walk the talk.
	And now I started changing.
	And those are the best letters I get.
	You know, I've gone on a diet.
	I dress every day.
	You know, and on and...
	No, it doesn't cost...
	I'm not talking about buying Armani or Hugo Boss.
	I'm talking about...
	You could go into Salvation Army and buy, you know, thrift stores and buy really high-quality stuff.
	This isn't a money issue.
	You're putting clothes on your back one way or another.
	You don't have to put on, you know, a hoodie and jeans every day.
	And I love the word hipsters.
	They ain't hip, man.
	Very furthest from it, you know.
	Hip.
	You know, I got a four-day growth beard, you know, and every one of us looks alike.
	No, and so to bring back style, grace, and dignity, when those kind of things start happening, to me, everything changes.
	Beautiful.
	Beautiful.
	Well said.
	We've got a break coming up.
	This has been a great chat with Gerald Salente, who I'm sure, like me, will have to wipe the flecks of passionate foam off his microphone.
	We are going to come right back after the break.
	I do have time for a call, or if you'd like to call in 855-472-4433.
	Come whisper in my ear.
	This is Stefan Molyneux for Peter Schiff.
	We'll be right back after the break.
	You're now enrolling in the Peter Schiff School of Advanced Economics.
	Twice the education of a Harvard MBA. For one one hundred sixty-eight thousandth the cost.
	Hi, everybody.
	It's Stefan Molyneux.
	It's my final segment of these last three days.
	Thanks, of course, to Peter Schiff for turning me over his show.
	I hope I have returned it unbroken, and I've just sent a message to the centurions at the Freedom Main Radio compound up here in Canada.
	We've locked Peter in a yurt with all of the fertile women, so hopefully he'll see it in his mind.
	He'll even come back and visit with you again tomorrow.
	Thanks, of course, to Tom and to the engineers.
	for their support as I bludgeon my way through live radio coming from a podcasting background.
	I really appreciate that.
	We have a caller on the line.
	Dave, are you with us?
	Yes, I'm with you.
	How are you?
	I'm well.
	What's on your mind, my friend?
	I got a question for you.
	What is your...
	First of all, you do a very good job.
	You're very intriguing, very intelligent.
	Thank you.
	Second of all, I find it probably as difficult as you as being an atheist at the same time being a libertarian I don't tend to gel well with the conservative spectrum of things, but nonetheless, what do you think of the separation of corporation and state as a constitutional amendment?
	Well, it's hard to imagine how that could be achieved, given that corporations and their minions give an enormous amount of money to politicians.
	You know, one of the things that has been proposed, which I think is a fairly good idea, is that congressmen and women should have Deckels put on them like NASCAR race cars to show exactly who was bought and paid for them, because this idea that we can choose from a sort of free range of the best thinkers and the best reasoners and the wisest among us is simply not true.
	The only people you will ever get to vote for are people who have been bought and paid for by special interests.
	That's how it works.
	It costs hundreds of millions of dollars to run a successful presidential campaign, millions of dollars to run a successful Congress campaign.
	You get that money from somewhere.
	It sure ain't from you, right?
	They don't spend their own money.
	Steve Forbes and a few other people, I guess, did.
	But I don't see how people funded by corporations are going to promote the separation of corporations and the state.
	Of course, and this is what Ayn Rand said, right?
	She said, with the separation of church and state, we need the separation of state and economics for exactly the same reasons, but...
	It seems pretty hard to imagine how that can be achieved until, until, until, and unless people accept the non-aggression principle, the initiation of force is wrong, and work the moral crusade.
	You know, Western Europeans did this amazing thing for about 150 years.
	They fought, they bled, they died, they spent treasure and lives to end the worldwide practice of slavery.
	Ah, who's called racist these days?
	Well, whites.
	But the reality is there was a worldwide practice called slavery Which was largely, if not completely, ended by Western, whitey, European dudes.
	And if we have a moral crusade, which it was a Christian crusade, that we're all equal under the eyes of God, and that slavery is an abomination, they had that moral crusade and they were willing to see it through.
	We need people to wake up to a moral crusade, then we can overcome the powers that be.
	But we first have to recognize what evil is, what immorality is.
	It's the initiation of force, it's violations of property rights, which is the nature of the state.
	And the corporate toadies who profit and attend from it?
	Until people wake up to that, I can't see how it's going to happen.
	What do you think?
	Well, I agree with you.
	The question is, how is it going to happen?
	When is it going to happen?
	Is it ever going to happen?
	And to me, from a philosophical standpoint, the minds of Americans and Canadians, I really don't think they're ever going to come out of the very deep hole that they're trapped in.
	I just don't see any real awakening.
	I know that you hear people from various, you know, aspects of society speaking about there's an awakening.
	I just think it's almost nil.
	Well, okay, Dave, how did it happen for you?
	Well, my father is actually a historian, a college professor, raised in a very, how could I say, I didn't have a blindfold on when I was raised.
	We did not obtain a lot of religious, moral upbringing, but we...
	We have a lot of what we consider moral undertones.
	We don't initiate force.
	Our family is very open-minded.
	Originally from Canada, by the way.
	Actually, my parents are from Montreal.
	We don't have a philosophy of aggression, and I think that's the key.
	You mentioned that aggression, that principle that people have in society, that they want to basically control everything through force.
	It's very difficult to change the minds of individuals who like power.
	I think that's the answer.
	I don't know if you know the answer, but you said the answer, which I think there's lots to support, which is it came from your family.
	It came from your parents.
	So we have this thing called the non-aggression principle, right?
	The non-aggression principle is thou shalt not initiate force against the fellow carbon-based life forms or the silicon diamond cube people should they arrive from Betelgeuse.
	So we do not initiate force against others.
	Now, we cannot change Federal Reserve policy directly.
	We cannot change imperialism.
	We cannot undo the military industrial complex.
	We cannot undo the special interest lobbying groups.
	What can we do to implement the non-aggression principle In our lives.
	Well, this is what my philosophy, which I hope is just good philosophy, not mine.
	There's no my science.
	There's good science or bad science.
	What do we do?
	Well, we refuse to initiate force with those around us.
	Now, I get that most people aren't dragging off women in a sack to date them.
	I get that most people don't hold kids hostage from people they want to get jobs from.
	Where the initiation of the force is most prevalent in society is aggression against children.
	So you don't spank, you don't initiate force, you don't threaten, you don't punish your children.
	If you do not initiate force against your children through spanking, through punishments and so on, through raising your voice, through threatening them with abandonment or anything like that, you know, I'm leaving, you come if you want.
	If you don't initiate force or threats against your children, They will grow up able to think.
	They will grow up unable to fit into the current hierarchy of aggression called the state.
	The state is an effect of the family.
	Our greatest abstractions are, and this is fairly well established in psychological circus, our greatest abstractions are a reflection of our earliest experiences.
	If you don't raise your children speaking Mandarin, guess what?
	They ain't going to speak Mandarin natively.
	If you don't raise your children with aggression, they will not.
	They will not fit into a society based on aggression.
	They will not support war.
	This is all very well established.
	It's a little bit hidden because a lot of people don't feel that great about hitting their kids.
	Still 70 to 80 percent of people.
	Sorry, I've got to finish up because we're almost done.
	I wish I could let you back in, but maybe next time I'm on.
	70-80% of parents are still hitting their children.
	We've got to stop that stuff, my friends.
	We've got to stop it.
	Treat the kids beautifully, we get a beautiful world.
	Aggress against your kids, we get an aggressive world.
	This is Stefan Molyneux from Freedom Aid Radio.
	Thanks to everyone.
	I'm out.

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