April 28, 2016 - Freedomain Radio - Stefan Molyneux
01:10:27
3275 The Story of Your Enslavement | Mike Maloney and Stefan Molyneux
We can only be kept in the cages we do not see. With over four million video views on YouTube, The Story of Your Enslavement is the most successful video ever published on this channel. Mike Maloney joins Stefan Molyneux to discuss the important themes contained within the video and how it relates to the word today!Michael Maloney is the founder and owner of GoldSilver.com, a global leader in gold and silver sales and is also the author of the bestselling precious metals investment book of all time, “Guide To Investing in Gold & Silver: Protect Your Financial Future.”Get "Guide to Investing In Gold and Silver: Protect Your Financial Future" at: http://www.fdrurl.com/mike-maloneyCheck out GoldSilver.com at: http://goldsilver.comThe Story of Your Enslavementhttps://www.youtube.com/watch?v=Xbp6umQT58AFreedomain Radio is 100% funded by viewers like you. Please support the show by signing up for a monthly subscription or making a one time donation at: http://www.freedomainradio.com/donateGet more from Stefan Molyneux and Freedomain Radio including books, podcasts and other info at: http://www.freedomainradio.com
Stefan Molyneux from Free Domain Radio, back with a good friend, Mike Maloney.
He's the founder and owner of GoldSilver.com, a global leader in gold and silver sales.
Also, the author of the best-selling precious metals investment book of all time, Guide to Investing in Gold and Silver, Protect Your Financial Future, which we will, of course, link to both below.
Welcome back, Mr.
Mike.
How are you doing today?
I'm doing great, Stefan.
How are you doing?
Very well.
Thank you.
So what's on your mind, brother?
Well, I recently re-watched the story of your enslavement, one of your masterpieces that you created.
It is such a lucid look at how there is a class of people that benefit from us being all born into a society where we are controlled and where a portion of our prosperity is always continually siphoned off And transferred to a class of people that get to ride for free.
Anybody that watches it needs to watch it all the way through because it's the second half of the video that really explains how we are enslaved and how we enslave ourselves.
It's the way that our society is set up.
I've often said that mankind's biggest downfall is our follow the leader mentality.
We always want to hire somebody to tell us what to do instead of making our own decisions.
We're going through that process right now.
When I joined the call, you were having a Talk in the background about the current elections that are going on.
I have purposely sort of isolated myself from that dog and pony show this time around because I don't see any change that comes from it.
Every four years we have this popularity contest to see who is the best at not putting their foot in their mouth in a 20-second soundbite.
And who, somebody that's got just the slightest bit of charisma.
But what I can't believe is that the choices that we come up with, here's a country of over 300 million people and this is the best we can come up with?
I mean, there is something, I mean, remarkable happening.
And I've got videos about completely disengaging from the political process because It is the same revolving door with the same guy who comes out and hits your future with a club, and then the next guy comes around.
But every now and then, weird stuff does happen in politics.
I'm thinking of, in the 19th century, there were two great political movements that succeeded relatively well.
Number one was the abolition of slavery, and number two was the abolition of tariffs, or at least under the Corn Laws thing and so on.
And those were crazy people who had wild ideals and to a large degree couldn't be bought off.
And there is a vague possibility that Donald Trump sits in that category, that he has a passionate ideal.
He certainly isn't bought off because he's funding his own campaign pretty much to the hilt.
So he's not beholden to special interest groups.
And I do like the fact that him striding in like a bull into the china shop of delicately and artfully constructed American political systems is smashing the media narrative and is smashing what's called the cuckservatives or the people, or the rhinos, Republicans in name only, the people who claim to represent small government, free market, and strong borders, but who don't.
And the degree to which the Republican Party has turned against someone who's actually listening to the people is shocking a lot of Republicans into realizing that they really have been led off a Cliff Lemming style with this mirage of the free market that results in this crony capitalism.
Yeah.
And, you know, you just said crony capitalism.
Yeah.
Capitalism is going to be blamed.
I mean, we're about to go into the next global recession slash crisis.
I think it's going to be a lot worse than 2008.
But there's been no economic expansion in history that's gone longer than a decade.
And we're more than seven years into this expansion.
Normally, every five and a half years, the US has a recession.
And there's a whole bunch of indicators that have turned negative.
And it looks like we could already be in a recession.
And nothing structural has been fixed from the last one.
No.
Like at least back in like 1920 of, sorry, I'll just be a second, 1920, last century, there was a recession sharper than 1929, but because the government didn't get involved, it self-corrected relatively quickly.
But this has just been borrowed and bailed out and financed, and nothing structural has changed in the economy that would allow it to recover from the huge problems that beset America in the middle of the last decade.
Yeah, all the borrowing and the currency creation to do the bailouts, that all creates a wealth transfer.
The wealth doesn't come from nowhere.
It just creates a wealth transfer.
And so we transferred a whole bunch of wealth from Main Street to Wall Street and gave a mirage of a recovery.
It isn't a real recovery.
And that All of that manipulation of the free market that just occurred is going to come back to haunt us when that energy is released in the opposite direction.
And I think we're going to end up seeing a crisis coming at us that's worse.
And what's scary about that is that when you've frightened a population, That's when they're more controllable, and that's why just watching the story of your enslavement again, we're at this crisis tipping point here.
In my fifth episode of Hidden Secrets of Money, I give a tour of the Bundesbank Monetary Museum, and then we drive around Germany a little bit.
we go through checkpoint charlie uh and the and you know in berlin and uh the bundestag uh where just the story of the rise of hitler it came out of his he became famous in the final week of the weimar hyperinflation that
That's when the middle class had been wiped out, they were all scared, and they were looking for somebody really strong to lead them, a very strong leader.
I see the potential for that happening in the United States.
I see a demographic Where you've got these aging baby boomers that have all been trained by Alan Greenspan and then Ben Bernanke to not save anything and to use their homes as ATMs.
And so you've got people that are basically broke.
A lot of them have a negative net worth when you include their mortgage and everything else, the cars that they owe on.
The average IRA in the United States has about $10,000 in it, which is like a month's expenses for most of these people.
And they all expect to retire in just a couple of years.
And they're going to vote.
As this next crisis happens and they watch their IRAs evaporate by 50% or greater, And they get really scared.
I believe that we're going into a short-term deflation because the velocity of currency will slow down as they get really scared and stop spending.
And that will cause the Federal Reserve and the rest of the world's central banks To print and print and print until deflation gives way.
And when they do, the stored up energy could cause a huge inflation or hyperinflation as soon as this scared population becomes comfortable enough to think that they've got enough saved to where they'll be all right.
Now they deserve that new car that they've put off for four years or that big screen TV or whatever.
But politically, as the baby boomers increasingly vote for the government to take care of them, it means that Congress and so on will vote to tax the rich and transfer their wealth more and more toward the scared middle class, which will become a little bit more impoverished during this period of time.
Just before you go on, because we just talked about inflation briefly, sorry, deflation.
And a lot of people get confused by deflation.
It's always portrayed demonically in sort of the mainstream pseudo-economic press.
But deflation, I mean, that just sounds great.
Hey, price is going down.
My money is worth more.
I mean, isn't that basically why we like opening the next pamphlet from a computer store?
It's like, wow, what cool new stuff can I now get for half the price?
Isn't that a good thing?
Yes, it is.
I don't know why everybody thinks that it's great if real estate always goes up.
It makes the people that already own real estate feel richer and they go out and spend, but it also out prices a new family trying to get started.
We don't have the option of being able to buy a house in a lot of areas.
But deflation is great because you don't even need the banks.
This is the good part about deflation.
A slow, mild deflation gives you the opportunity to just store your currency and gain purchasing power in the future, which is what interest is supposed to do.
So if you have a slow deflation, which is the natural order of things?
Mankind always becomes more efficient at chopping things down, at punching holes in the ground and sucking energy out of it.
At building homes, at manufacturing things.
A slow, mild, continuous deflation is the natural order of any society that has a fixed currency supply.
You know, I came up with a measurement of inflation when I was writing my book.
This chapter got cut out of it.
But I call it cup inflation.
C-U-P-P. Currency units per person.
If that was relatively fixed, then what we would see is very stable prices with this very slow deflation where things get cheaper over time.
Well, what happens then?
You really don't need the banks except for transmitting currency from here to there, but now we've developed blockchain technology, so we don't need the banks for that.
But all you have to do is let your currency sit, your savings, and they become more valuable in the future.
You know, in the United States, a single-family median price home at the beginning of the last century was about $3,000.
Well, that means a home today.
Those were Victorian houses that were very, very hand-built.
It took 60 people a month, not a month, but months and months and months to put a house up, and now 60 guys put up a subdivision of 150 homes in the same period of time that they used to be able to build one home.
They're just slamming it together with nail guns, and they've got all these plastic pipes and stuff that just go together right away.
A home today should cost around $1,500 in the United States, maybe $1,000.
Well, I remember a friend of mine was talking about being a teacher in the 60s, and he said, oh yeah, back in the 60s, this was in Canada, we made about $9,000 a year, and we thought it was outrageous that we had to pay $12,000 for a house.
Right.
Now, teachers now sort of make sort of $60,000 or $70,000 a year, which means a house should be $90,000 to $95,000.
But houses in Toronto, where this man was living, you know, pushing close to a million dollars now.
I heard this skit.
Vancouver, of course, on the West Coast has got a lot of Chinese money coming in.
A lot of it's driving up the price of real estate.
And there was a skit about a young couple looking for a condo.
And the real estate agent is like, well, I've got this lovely unit for you.
And they said, ooh, what's the square footage?
And he says, four.
And they're like, ooh, can we afford that much?
And, you know, it's kind of grim comedy, but it really has blocked a lot of people from the joys of homeownership.
And so they were talking about 4,000 square feet, not 400.
Four.
Four square feet.
Four square feet.
Like, four square feet.
Ooh, can we afford?
That's extravagant.
Maybe three and a half we can do, but not four.
Yes.
You've seen that video, Doorbell, right?
No, I haven't.
No?
Okay, well, it's somebody from the government that rings a doorbell.
You don't see him.
You see a lady that answers the door with a child in her arms.
Maybe a three or four-year-old girl.
And the man that's standing outside the door, you never see him, says, you know, the government's broke and we're here for some money.
You owe X amount.
And we can take that as so many dollars per month over a 30-year period.
And she says, I can't afford that.
I'm going to be 85 years old by that time or whatever age.
And he goes, I wasn't talking to you, man.
Thank you.
It was his daughter, her daughter.
And the giant government claw comes in and takes the baby from her arms, sells it for parts.
You know, it's interesting, the story of your enslavement, if people watch the episode four of Hidden Secrets of Money, they will see how the prosperity that we're enjoying today is all mortgaged, basically.
We borrow our currency into existence, and the way that currency largely gets paid back is through future taxation.
We pay taxes in the future to pay off the principal and the interest on the bond that the Federal Reserve or whatever government purchases when currency springs into existence.
They purchase an asset and write a check They're basically counterfeiting.
They write a check on an account that has a zero balance and currency springs into existence.
But because that currency is backed by a bond like a US Treasury bond, it means that any bond, that's an IOU. The government is borrowing currency so they can do deficit spending.
But they have to tax us in the future to pay back the principal and interest on that bond to an entity that bought it from nothing.
Oh, bonds.
I remember when I was younger and people would try to sell me bonds and I would just say, why on earth would I buy an instrument that guarantees me a future tax increase?
I mean, and particularly on people who often can't afford those bonds.
I mean, that's predatory.
I mean, would you like to become a financial vampire?
No, thanks.
My teeth are fine just the way they are.
I love it.
When I was watching the story of your enslavement, this is just another factor of how we are enslaved, but what's brilliant about the story that you tell is how Society has been constructed so that we enslave ourselves by the way that we vote, by the choices that we make.
And people do need to watch this, find out as many ways as possible that they have become enslaved by the things that they vote for and the actions that our governments take.
And we are at a very, you know, This is the first time, and we're reaching this point where everybody around the world can be as fully informed as possible.
And because of the internet, and because of our Intellectual freedom.
We can free ourselves if we want, if we choose.
It's a shame that so many people place sports and the latest star, their interests in those things, over the interest in their own freedom.
If you want to understand freedom, you also have to understand economics, because economics largely determines not just your own financial prosperity, but it also determines how free you are in the political system that you live under.
So it's something that's very, very important for everybody to start looking at.
Oh yeah, the old bread and circuses goes back to ancient Rome, and it's a great way of distracting the masses.
I also feel, Mike, that intelligence is a muscle that works against resistance.
And when you create this bubble of everything's free, and the government will take care of all of your problems, and you will borrow your way into the illusion of security, what happens is people, it's like if you sit on the couch all day, you're not exactly going to get any stronger.
And so by taking away, yeah, we all want something for free, and that's why we have great technology that allows us to have this conversation without Absolutely.
and once people get this illusion called something for nothing enforced by the state, they kind of just go flaccid.
They turn from homo erectus into homo jellyfish dependent on the state.
Absolutely.
You know, I mean, you talked about getting something for free.
People actually think that the government can give you something for free.
When we started with very small government, when a town in the Old West, or it could be on the East Coast, when the US was getting started, or anywhere, any society, when they first start out, you would have a town meeting.
In your little town to determine whether or not you needed a sheriff or a fire department.
And if you wanted a fire department, people would have a town meeting and they all realized that it was them that was going to have to pay for it.
And so they would be very, very frugal and they'd purchase only the equipment that they would need and then they would have a volunteer fire department where volunteers would train and everything was done on this very frugal level.
As government became bigger and bigger, people started getting this idea that the government can actually provide something for free.
And the problem with anything that the government provides, anything that the government provides is at a net loss to society in general.
Yes, it can enrich a few people, but it's at the expense of the many.
And it's simply because when you tax a productive individual or business, you take two dollars from that productive individual or business And then you have to run it through the IRS and all of those people and those attorneys and everybody whose job it is, who you hire to take this currency away from you, they have to get paid.
And they turned it over to Congress who argues about setting up some new department or new spending bill.
They argue for months and they all have to get paid.
The people at the Treasury had to get paid just before Congress.
I'm sorry I sort of interrupted this loop.
And then they They send a bill to the president.
There's a group of people there that have to argue whether or not he should sign it, and then they send it to the president.
He has to get paid too, and he signs it.
And then they create some new department with multiple levels of bureaucracy inside that department, and then one dollar comes spitting out at the other end to pay a teacher or somebody building a road.
So whatever we ask for from the government comes at half the cost, twice the cost and half the efficiency of the private sector.
And so therefore, just because of the simple mechanics of it, there is nothing that the government can provide for us that doesn't come at a net loss for society.
Well, this is the astounding thing about universal ethics, and that's sort of my major, that's the sun of the stars by which I sort of navigate what it is that I do, universal ethics.
The two things that governments continually ban are bribery and counterfeiting.
Now, Mike, you tell me how the current system could conceivably work without bribing the voters with counterfeit money.
Well, they don't just bribe the voters with counterfeit money.
You have a whole lot of bribery that goes on.
It's called lobbying.
And then they pass some law that is sold to the public as being something that's going to protect the public.
But it always creates some huge document that's thousands of pages long that nobody understands that actually entrenches a few businesses.
Like, you know, we passed the Affordable Health Care Act.
And I'm an employer, and every single person that works for me, their insurance went way up, including mine, which almost doubled.
And there was a 19,000-page document created Everybody thought they were voting for free healthcare or voting against the insurance companies or the drug companies.
And all they did was, it's all the same insurance companies, the same drug companies, but here in the United States, if you choose not to have insurance, they now get to fine you on your tax return.
So you voted for the government to be empowered to create a fine if you choose, if you make a choice not to do something.
So it forced you toward all of the drug and insurance companies and they got to raise all of their prices and they are protected from any competition ever going up against them to cause them to have to lower prices.
So now they basically have a monopoly.
The whole system, yes, it's based on bribery and you are right.
When the Federal Reserve can print and the government is allowed to borrow From an entity that can just create currency from anywhere.
That government always will borrow and it will do deficit spending because then the politicians get to lie to you and tell you that if you vote for them, they're going to give you a bunch of free stuff.
And so yes, it's based on counterfeiting, it's based on lies, it's based on bribery.
You're right.
And this has so many tragic consequences from the larger sphere in terms of demographics.
Because, you know, whenever I put out these videos that talk about having kids and family and so on, I get these endless comments below of people saying, well, man, the world is totally overpopulated.
So, you know, having kids is a bad thing.
Human beings on Earth can only support so many people and so on.
It's like, oh, it's so frustrating because...
First of all, really smart people will be concerned about overpopulation.
You know, smart people think long term and big picture and so on.
Whereas less intelligent people, they don't really worry that much about overpopulation.
So if you're going to raise the concern of overpopulation, what you're going to do is you're going to say to smart people, don't have kids.
And that's not exactly going to stop overpopulation.
It's just going to stop overpopulation that's even remotely inhabited by intelligent people.
And given that intelligence has a lot of hereditary factors to it, you're basically setting up a system where less intelligent people are going to reproduce like crazy, and smarter people are going to be like, hmm, I'm worried about overpopulation.
How on earth is that going to benefit society in the long run?
There was a movie about that.
It's a dumb movie, but highly entertaining, called Idiocracy.
I highly recommend watching it, even though it's a dumb, fluff movie, but they keep on interviewing people This very intelligent couple and they're planning their family and by the time they get into their 50s, they're about ready to get divorced and they still haven't had kids.
And then they interview these beer-swilling sort of trailer trash people, not to necessarily Well, anyway.
They're out there.
We can be frank.
They're out there.
They end up with these multiple levels of offspring to where by the time the movie ends, it's set in the future, most of it.
And by the time it ends, you've got a population of really dumb, dumb people across the country.
And Obamacare, the reason it popped into my head is Obamacare really works along those lines because Smart people would look at the proposals of Obamacare and say, well, wait a minute.
If Barack Obama has a foolproof way to cut $3,800 from my healthcare bill every year, then he should invest in his business idea and make a trillion dollars.
Like, if you can undercut healthcare by $3,000 or $4,000 a year in the free market, man...
I mean, you would own the place.
You would not need government.
The free market would create an investment environment where if you could make that business case and prove how it was going to work, I mean, you'd put all these companies out of business, you'd end up ruling the market.
I mean, so you wouldn't need government.
And the other question is, why are people being forced to buy healthcare?
Because being forced to buy healthcare is a bad deal for young, healthy people because they're being forced to subsidize everyone else, right?
The moment they made this deal where they said, well, you can't deny people for pre-existing conditions, great!
So if the insurance company can't deny me fire insurance, if I call when my house is currently on fire, Guess what?
I'm not going to buy insurance until my house is on fire.
So people wait till they get sick and then they go buy health insurance, which negates the entire risk-reward mechanism of insurance.
So a wide variety of things were set up to the point where young people were getting sick and tired of subsidizing, sick and old people, and they just were dropping out of the equation.
So then they have to be herded back in, like livestock, to provide the subsidies that everyone else is now literally dying for.
Yes.
You know, there's a couple of examples that, well, there's several examples that we can use of healthcare being provided by the free market.
One of them is veterinary medicine, and you can get, for your dog, you can get a heart bypass surgery that would cost hundreds of thousands of dollars on a human, and it's getting cheaper and cheaper and cheaper.
It's, you know, a few thousand bucks.
The government makes everybody save 15% of their income and it goes into an account that you can only use for buying a home or for your healthcare.
And you have to shop for your healthcare, which means that all of the healthcare providers Have competition and they are all trying to get your business.
So even though it's not completely free market, it has some of the advantages of the free market.
And they have a very high quality health care that some of the lowest cost health care around the planet and anywhere That the government ends up providing healthcare.
You know, people say that government healthcare is great and it's free.
Well, it's not free.
It comes at a tremendous cost for society.
It comes through taxation.
And what it does is obscures the true price of it when you do that.
So, yeah, I agree with everything you just said.
Now there's something else that's occurring, and we talked about this just at the beginning of the interview, and I talked about this with Peter Schiff recently, which is there seems to be this resentment going off among the general population that some people are trying to avoid taxes.
You know, like that some people are trying to escape regulations, they're trying to minimize tax losses and so on.
And it sort of reminded me of this, an old phrase, I think it's drapetomania or something like that, which was a mental illness that was invented, I guess, like a lot of these things are.
It was invented in the 19th century, and it was the irrational unhappiness at being a slave.
Like...
If you were a slave and you tried to escape, that was a form of mental illness because clearly you should accept your slave status and be happy with it and so on.
And the fact that people would try and risk their way, striking their path through the Louisiana swamps to try and get on the Underground Railroad to Canada, it was just a mad delusion.
They should be happy being under the lash.
And the fact that people are trying to secure and save their precious assets, their life savings, their family's future, their children's legacies and so on, by trying to get out of these god-awful fiery nets of taxation and regulation, it's like, well, it's bad for you to want to get away from the predations of the it's bad for you to want to get away from the And now, like, there's this new phenomenon where people are – it's bad for you to try and keep your own money.
It's bad for you to try and escape the escalating costs of the state.
When I say it's a form of tax protest.
If taxes were 5% or 10%, who'd bother moving all this stuff around and paying all these lawyers and creating all these shell companies?
It wouldn't be worth it.
When taxes go nuts, then people act in a way to try and minimize.
It's a form of tax protest, but apparently it's just bad now and a kind of mental illness.
And selfishness.
It's selfish.
It's not selfish for me to want to use a state to take your money, but it's selfish for you to try and avoid that gun.
Yeah, and this is another thing that people don't realize, that the cost of this to society in general, they don't realize that our levels of prosperity would be far, far higher if we would allow the free market to work and allow people to just deal with one another Naturally, and make their own decisions and transactions.
When the state imposes high taxes to try and do this for us or do that for us, you just mentioned all of the things that people try to do to avoid taxes.
When we had these super high tax brackets in the United States back in the 50s, where the top tax bracket was over 90%, People spend all their time trying to figure out how to keep some of the currency that they earned.
And all of these, the CPAs and all of the different frictional jobs that I call them, a lot of these would not exist.
The number of accountants and people that specialize in this tax shelter or that tax shelter Would be dramatically reduced.
And if somebody isn't making a product that you want to sleep in, drive, eat, wear, or use as a shelter, those are the things that increase our true prosperity.
All of the stuff that we use and the things that we buy Not somebody providing a service that is going to figure out how to use some loophole so that I I've got a friend who's one of his best friends specializes in helping companies take advantage of tax loopholes.
Like, for instance, the movie industry is heavily subsidized when you shoot in certain areas.
So they move production companies and so on to one city or another country or whatever so that the movie can largely be paid for by the taxpayers.
That's who's ultimately paying for it.
And strangely enough, we don't see a lot of anti-tax movies.
It's just one of these, people don't understand that Hollywood is in the pocket of big government because they rely on these subsidies and government protected unions to produce their movies, not to mention the participation of the military so often, which is why you don't see a lot of government skeptical movies coming out these days.
And they're paying this guy whose jobs shouldn't exist, the guy who specializes in connecting the movie production company with the tax subsidy.
That job shouldn't exist and it's part of the frictional loss that happens.
I mean, how many dollars have to be sucked out of society to get that movie produced that you're then going to pay for again when you walk into the movie theater?
Well, there is a study that I read, and it's just one of many, and the scope of the difference is startling.
It said that if regulation had remained at the same levels as in the post-war period in America, you know, and it wasn't exactly like a Mad Max Thunderdome of crazy anarchy in the post-Second World War America.
If regulations had remained at the same size, then the GDP of America would currently be $53 trillion a year rather than $15.
$53 trillion a year, which means the average income would be a couple of hundred thousand dollars a year.
Do you not think that we'd be able to afford health care if the average income was like a quarter million dollars a year?
Do you think anyone would be poor except monks and people into performance art?
I mean, the idea that...
We must rely upon the government to solve the problem of poverty.
The poverty rate in the 1950s was declining one percentage point every year for the first time in human history.
Poverty was within a stone's throw of being eliminated among all but people who were choosing it voluntarily.
And then the government came in and tried to fix the last remaining vestiges of poverty with the welfare state, and then the whole progress stopped.
And now, if you count the deficit, poverty is much larger than it was when the government stepped in to solve a problem that the market was solving already.
We'd have no poor people.
There would be incomes in the hundreds of thousands of dollars a year.
We'd be living in a George Jetson paradise.
This alternate history is something that literally tortures me sometimes because I can see it as clear as day.
Yeah, you can also see it in a chart.
It's available on the Federal Reserve's website.
You can see poverty levels dropping right until we started Johnson's Great Society and all the welfare programs that are designed to eliminate poverty.
I'm a fan of saying, you get what you pay for.
And if you invest a lot in poverty, you get a lot of poverty.
And that's what we're doing.
You know, you were talking about taxation earlier and that people look down on anybody that seeks freedom, that wants to be less of a slave, and we are supposed to enjoy our own enslavement and promote more enslavement to be accepted in society.
There was a video recently that just went out.
It was a section of a television show.
It's available on the internet.
But they talk about Puerto Rico and all the problems that are happening in Puerto Rico.
And then Puerto Rico recently introduced a couple of tax incentives back in 2012 to try and attract businesses that will employ people down here and attract investors that are to Get as much currency flowing into the island as possible by encouraging businesses that export products to move here.
And I recently moved to Puerto Rico.
I am seeking the lowest taxation possible.
But instead of blaming the wealth transfer that is occurring, I mean, this is because of politicians That enact all of these laws that favor a certain group and create a wealth transfer.
But as a business person, it's my job to try and make my business as efficient as possible so that I can offer the best service and the lowest prices.
And that ultimately helps the consumer.
When everything becomes less expensive and you get a higher level of service, that is more true wealth in your society.
I would rather be living where I was living, but I was in California, and California has just made it, and their laws have become so oppressive to business.
It is just a nightmare to run a business in California, and I was trying to escape that enslavement.
The taxes are extremely high in California, and then they just added 3% to their The California tax went from 9.3 to 12.3 and then they added a 1% mental health tax and there's a couple of other the taxes and fees that you can pay so you end up before any sales tax or anything like that you end up paying about 14% income tax and then the federal tax went up from 35
to 39.6 so basically 40% so it's now possible You know, you get to deduct your state income tax from your income that you're putting onto your federal return.
But still, it's possible to pay 50% of all of the prosperity that you work for and you try to accumulate.
You have to pay 50% of that to the government unless you play their game and you have a whole bunch of write-offs and you allow the bank To own your life.
If you're enjoying a lifestyle where you're heavily in debt and the bank actually owns you, then you don't pay these high taxes that I'm talking about.
But if you want to be free of the bank and free of the government, you can't be free of the government.
But if you want to be free of the bank, your taxation levels are very, very high.
I moved to Puerto Rico because of the tax incentives, because it will allow me to run my business far easier.
Business these days, it's becoming dangerous to be in business.
The government has created so many, hundreds and hundreds and thousands of rules, regulations and laws that are very specific and very specialized, they're no longer general, to where you can be committing a crime and not even know it.
So it's sort of a scary thing to actually be an entrepreneur and be in business, and that ultimately will destroy prosperity for society in general.
If we keep on going down this road.
This aspect where the law has become functionally incomprehensible, particularly tax law, but if you combine tax law, federal law, regulatory law, local law, municipal law, there's nobody even remotely who has any clue about the totality of it, which means there's no expert or group of experts that you can hire who can guarantee you that you're on the sunny side of the law.
And given that there's also seems to be creeping in the capacity for retroactive law, you can be on the sunny side of the law now and then find out later that you weren't because of something that happens later.
That crack which has been around since common law days seems to be being broached regularly.
And of course the original idea of law was do not initiate force and keep your word.
And that was it, right?
Do not initiate force against others and if you sign a contract you are obligated to keep it.
That was it.
Criminal law and contract law.
That was the sum totality Of the original idea behind the law, which, you know, I explained to my daughter when she was three and a half and she got it.
You know, she's still having trouble with volume 47 of the U.S. tax code because, you know, she's only seven.
But, you know, we're working on it because it's really important for her to understand the system that she may end up inheriting.
But the other thing, too, is that the people in California are probably upset at you for moving to Puerto Rico, whereas the way that I would explain it to the people in California is that our good friend Mike is providing an inestimable service to you.
Because if everybody stays and pays the tax, the tax will never, ever be reduced.
If every slave was happy being a slave, slavery would never end.
Slavery ends when the total cost of ownership of slavery increases.
The total cost of ownership of slavery decreases the more compliant and passive the slaves are.
So actively moving your resources to the lowest tax jurisdiction is rewarding the people who've reduced the taxes and punishing those who have raised the taxes.
Because in the absence of mobility, the tax rate, which you could argue is already over 100% if you count the deficit, has never any incentive to be reduced.
No, it doesn't.
There's great hope in the future.
I mean, we can all change this.
But the...
When I see a production like this video that was very, very popular where they blame the rich people or the business owners or this class of people for all of the bad decisions that have been made over decades by this island here.
They're in a financial jam and they're blaming it on the People that are trying to take advantage of the tax incentives that these politicians created.
Do I think these tax incentives are smart for the island?
I doubt it very much.
Whenever you create something that manipulates an economy, yeah, real estate in certain cities here is doing well, in the cities where these businesses want to move, but the rest of the island is just crashing.
It's causing real estate prices to go up in an economic environment where most of the local population is making less and less and less, which means that that local population that originally used to live in these areas can no longer afford it.
So their children have absolutely no hope of being able to purchase a piece of property in the same neighborhood that they grew up in, simply because the tax incentives created by the politicians, these promises, these great ideas that violate the free market, they always end up impoverishing people.
But if you're providing a product or a service and you're employing people, it is your job to run your business as efficiently as possible and to try and provide.
Every businessman wants to capture market share and the way you capture market share is by doing a better job than your competition for your customer.
You want to make life better for your customer.
That's your job.
That's the way that you grow.
And you do that by always becoming more efficient, testing out every idea that you can to try and deliver a better product in a shorter period of time at a higher level of customer service at a lower price.
That is what the free market encourages.
That's what competition does.
One of the problems with government is there really isn't much competition.
All governments tend to extract about 18 to 20% of the economic energy out of their populations.
And they do it with different tax schemes.
And a whole lot of it is hidden.
You should see a chart.
If you take a chart that's 100% of the tax revenues that come in, but it's split into different sections of How much tax is from corporate tax?
How much tax is from income tax?
How much tax is from tariffs and excise tax?
And what's interesting, they introduced a payroll tax a long time ago.
And payroll taxes, it's illegal for an employer to disclose how much the company is paying on behalf of the employee.
If you hire somebody that's going to cost $100,000 a year is what you're going to pay them, it actually costs the business about $120,000 a year or $115,000 a year.
And of government revenues, the amount of payroll tax is now about equal to the income tax.
Why is that?
It's because people that are in a very low tax bracket, if you're not getting paid very much, you don't pay much income tax, but the company still pays plenty of payroll tax on behalf of that employee.
It's a cost of the employee.
It's really an income tax that is hidden from the employee, and the employee can't see it.
And since the employee can't see it, you know, they vote for laws that will benefit them, of course, and lower their particular taxes.
But the government will extract 18 to 20 percent out of a population.
That's the Laffer curve.
It shows that the maximum amount of revenues that a government can extract before slowing down the economy so much that there's less tax revenues available peaks at around between 15 and 20 percent.
However, What allows us the maximum amount of prosperity in a society, the maximum amount of wealth for each individual in society?
That happens at the lowest tax rates possible.
We've centered this whole video around economic freedom.
We started off with your video, the story of your enslavement.
And if you go to freetheworld.com or economicfreedom.org, there's several think tanks around the world that have been collecting economic data from any country that has reliable economic data.
And when you take the size of the government compared to the GDP, the size of the economy, the levels of taxation, the fairness of their laws and the court system, and the freedom from corruption of the court system and the political system,
when you take Economic freedom where you're allowed to go anywhere on the planet and buy, sell, import, export, invest in anything you want and then bring your currency or wealth back to you without high levels of taxation.
And then the last factor, Regulation.
And that's usually split into several different categories.
Regulation of the stock markets, regulation of the financial sector, regulation of the banks, but mostly regulation of small business.
When they over-regulate small business, it just absolutely crushes prosperity.
But when you put all these factors into a spreadsheet and you hit sort, What you discover is that the countries that have the smallest government compared to the size of their economy, the lowest levels of taxation, the most fair and least corrupt court and political systems, the highest level of economic freedom and the lowest amount of regulation in all categories, those people float up to the top.
They live 20 years longer than the people where the government is trying to take care of everything for them.
They live in cleaner environments.
They don't have child labor problems.
The list goes on and on and on.
Your life is just better when you stop trying to all live off of each other.
You know, what was wrong?
My parents grew up in an era where they would lift themselves up by their own bootstraps My father was a World War II vet, fought in the Battle of the Bulge, and he never asked the government for anything.
He never took advantage of any of his VA benefits.
He made it his own job to take care of himself and his family, and he did a great job, I believe, for our family.
And that was where our whole society came from.
The Revolutionary War was a war to get government out of our lives and free ourselves from very high levels of taxation.
So that is what started The United States of America.
And because we had such a fair legal system, and we were trying to create...
It's government's job just to create a level playing field for everybody, to create a set of laws that's fair for all of us, and then, as you said, to protect us from...
How did you say the two primary functions of government that...
Well, I mean, the idea of common law, which evolved actually in a free market environment rather than it evolved a lot in the Irish sort of stateless society and so on.
But it was do not initiate force against others and keep your word if you sign a contract.
And this is quality of life issues that you talk about are huge because, you know, we're talking a lot about dollars and cents and those are important.
But health, longevity, happiness and so on, an increasingly status environment creates massive amounts of stress.
I mean, being an entrepreneur, I mean, I remember when I was an entrepreneur, I co-founded a software company and grew it, and we were selling across the border.
The degree to which we had to deal with changing interest rates, changing regulations, and changing values of currency between American and Canadian currencies, which in a gold-backed currency would be far less.
I mean, these were all like, man, there's enough complexity in business without trying to navigate.
It's tough enough to climb a mountain, it's really hard to climb a volcano.
volcano, an active volcano, because everything's constantly shifting around you.
So the quality of life issues are very important.
And one of the things that struck me is the degree to which, you know, Europeans and Westerners and so on just not having kids anymore.
I mean, we're way below replacement rates.
A lot of that has to do with the fact that men are scared to get married, because in order to get women's votes, very male unfriendly divorce laws have been set up and men are just afraid of having half their stuff taken.
And so also when governments convinced women to go into the workforce, they got a double benefit because you can't tax moms, but you can tax women in the workforce.
And you can also tax and create government unions to supply childcare, the childcare workers to take care of the kids.
And And so you've created the situation where we have massive unfunded liabilities to the elderly who generally have not produced the tax livestock that will need to be milked to pay for all of those healthcare and pension benefits that are promised to the young.
And so now you have this myth that all cultures and all Groups are just, everyone's the same, so it doesn't matter if you haven't had kids.
We'll just import a whole bunch of people from the third world who don't speak your language, who don't have the history of freedom, who don't have the Judeo-Christian and Greco-Roman traditions, who don't have an idea about small government that makes sense.
And so we'll just import all those people, and it's just exactly the same as if you'd had kids, and that's how we're going to provide for your old age.
Or was this complete falsehood?
It is.
In order to control population, these think tanks that have been collecting all this economic data and that spreadsheet that I talked about, it's all the countries that float up to the top, the countries that have the freedom, that have those lower population replacement rates.
So if you want to control population, what you have to do is lift people out of poverty And the way you do that is through economic freedom, through allowing them to all compete and to try and serve each other, to try and produce goods and services and sell it to your neighbor.
This is what creates prosperity.
And once you lift people out of poverty, they don't reproduce as much.
They don't have six or eight kids.
They have 1.3 or 2.7 or something like that.
And then you touched on if we had gold-backed currencies.
Well, a national currency, though, is another way to enslave us.
You have to change currencies from country to country.
There was a time when people used gold, and you actually could use a gold coin.
If you knew the purity and you knew the weight, it didn't really matter.
What language or what image was on that piece of gold?
Exchange rates, you didn't really lose anything in exchanging currency back then and it allowed people to travel Anywhere and buy anything with a universal currency, a one-world currency, gold.
Gold or silver.
We actually had two one-world currencies.
When you create a national currency, it's another scam, basically, where the government is having influence and control over you, and it allows them to start...
If we went back to gold-backed national currencies, Initially, our gold-backed currencies were fully backed.
And then with the establishment of the Federal Reserve, we went to 40% backed.
So they were creating more currency than gold.
I'm sorry, just so people know what that means, it means that you could take 20 bucks and you could go in and get an ounce of gold or whatever the price.
Like, you could go in and exchange anything you wanted for gold, which meant that the gold had to be there because paper currency was originally just a representation of gold.
It wasn't supposed to be a substitute or a replacement for it.
Yeah, in the United States, before the Federal Reserve, if you had a $20 Treasury note by the US government, you could take that into any bank and ask for a $20 gold piece.
And the Treasury had a $20 gold piece in their vaults for every gold note in circulation.
And then we established the Federal Reserve, and that allowed the Federal Reserve to create $50 worth of notes payable in gold, guaranteeing payment in gold, For each $20 worth of gold that they had.
That's the 40% reserve ratio, so it's counterfeiting.
It's a lie.
It's saying that it's gold-backed, but it's only partially gold-backed.
Each bill said it was fully redeemable in gold, but the gold was only available for 40% of the bills.
Then under the Bretton Woods system, there was really no reserve specified, and it fell to about 8%.
Under the dollar standard that we're on now, there is no gold backing whatsoever.
It's all debt backed.
So we have to pay taxes in the future to pay for the prosperity.
We just finished paying off the prosperity we enjoyed under Ronald Reagan just recently here.
There's a 30-year Treasury bond.
So whatever prosperity you're enjoying now, You have to imagine your kids paying for it in 30 years.
Whatever taxes that you pay today, a portion of it is going to pay for the prosperity when we pay off those 30-year bonds.
So there's other duration bonds and we're paying for all of them.
But another thing you touched on when you were talking about men not wanting to get married.
Here in Puerto Rico, They established a law a while back.
All of these laws have very good intentions, and they're passed by very well-meaning people.
But they wanted to take care of unwed mothers.
It just wasn't fair that unwed mothers, you know, they had a child to raise, trying to get them by on one salary, one paycheck.
And so the government wanted to help them out.
They passed a law to subsidize unwed mothers and what happened is people stopped getting married and unwed mothers would have more kids because they got paid And what would happen is they would stay unwed.
They would have four kids.
Their boyfriend and parents would then move in with them.
And so you've got this industry that has been created by this law.
And, you know, it's part of the debt that Puerto Rico has this crushing debt.
They've been on this spending spree to try and do all of these social programs that are very, very well-intentioned.
But ultimately have very, very bad, perverse results when you look at- Well, and father absence is a form of environmental toxin, particularly for boys.
Father absence produces significant negative outcomes for children as a whole.
And actually, girls go into puberty a year or two earlier if their father isn't around.
It actually affects their biology- Very fundamentally, we've got the truth about single moms as a presentation.
We can link to that below.
I won't go into all the details.
But it's not just, well, you know, the dad's not around or the dad's sort of...
It allows the women to choose sexy men rather than stable men, which is, you know, I guess fun for a night, but not great for the future.
But this has been creating an entire generation of young men and young women who grow.
I mean, you only have to look at the black community in the U.S., where illegitimacy from the 1950s and 1960s went from 20% to 73%.
And look at the effects that that's having on black culture.
Father absence is crippling for children's development as a whole.
And that just passes the buck forward in terms of criminology, in terms of continued social dysfunction, unstable relationships in the future, mental health issues, substance abuse issues, drug, alcohol, cigarette issues.
These are all created by father absent homes.
So yeah, you can solve little problems in the here and now, but in the expense of creating a giant snowball of hell coming down in the future.
Yes, that saying you get what you pay for, that is exactly what happened in Puerto Rico here.
When they wanted to help unwed mothers, what has happened is the amount of unwed mothers has skyrocketed.
The number of kids without a father has skyrocketed.
The number of people getting married has plummeted because that's what they invested in basically.
To close things off, and I do want to startle people with some challenging and alarming information, but at the same time, I don't want to paralyze them by having them feel overwhelmed with doom and despair.
I also don't want to give people hope, because hope to me, I don't want people to cross their fingers.
I want them to close their fists and get angry and have the necessary conversations about how to improve the world.
But that is the hope, though.
People having those conversations, that is the hope.
Okay, well, I just don't want people to hope, because hope to me is kind of a paralysis.
It's not really a strategy.
But what would you say to people that you think is the most important things that they can do?
Because we do have this incredible Borg brain of the internet by which people can have and listen to conversations like this rather than hearing the same...
Nonsense spewed out by the highly state-invested mainstream media and movies and all that.
We can have these conversations.
We have the internet.
Ignorance now is a choice, not an absolute, because to remain ignorant in the age of libraries, the internet, and cell phones that can access some total of human knowledge when you're on the toilet, there's no excuse anymore.
What would you say to people in terms of, we've presented them some significant challenges, what would you say to them to motivate them into action?
Well, I would say that, you know, just having hope, hope is not a good business plan.
Brightness of future though, hope that things will be better, and a plan That you can put into action to help change things, to implement the potential results of that hope, to create a brighter future.
Basically, what everybody has to do is when they come to a conclusion that is based on data and facts and is very proven, then they have to help spread that information.
They have to win the hearts and minds of people.
When we have data that simply shows that freedom is connected with prosperity, and then you have a bunch of people that listen to a politician who repeats a good idea over and over again, well, we don't need to Try that good idea to know what the results are.
What we can do is take a look in the past to see similar ideas and what the results from those ideas.
We can measure what the results were from ideas that were very, very similar and we will know the outcome of that good idea.
Because everybody that is currently dragging society down and making our future worse is doing so with the best of intentions.
So they're not actually They might be wrong, but the difference between murder and manslaughter is they both have the same outcome, but one is unintended, uninformed, and one is premeditated.
I don't want to compare any of this to murder or manslaughter, but what I'm saying is that doing something that has a good intention But a bad result is different than if you are informed and you still vote for that idea.
If you vote for some politician's good idea but you have information that shows what the potential outcome is, I think that the great hope lies in the internet and the spread of ideas and the transfer of information and that we all need to educate each other as quickly as possible.
And if it's done from the perspective of history, when people look at the results of policies and laws and And then connect that with what is going on today, I believe there is great hope.
But it's up to us to implement it, to work, to achieve all of those dreams and aspirations of a better future.
And it's funny because I haven't looked at the story of your enslavement, which, you know, four and a half million views is certainly the, it's my bohemian rhapsody.
Watch it again was interesting because what I often find when I go and review my old material, and this is all the way back to writing from my 20s and my teens and that, which I will occasionally do, I'm really struck by the degree to which I don't listen to myself.
You know, like I make these predictions and I talk about these trends and then somehow maybe it's just exposure to the mainstream media or whatever it is that I sort of do as part of my occupation.
But I was saying in the video, well, there's this cross attack, right?
This attack that the way that we're all enslaved is that we agree to attack each other.
And one of the ways that we attack each other is the government makes certain groups of tax livestock dependent on the government.
And therefore, anyone who threatens the government power threatens the tax livestock that's dependent on the government, like the cows who think they can't exist without the farmer.
Anyone who says maybe we don't need a farmer, the dependent cows will try and trample you down too because you're going to get rid of the feed bags that they get their heads stuffed into every day.
And that has really, really occurred.
And the degree to which this horizontal attack that I talked about in the video is occurring now in terms of hysterical political correctness.
And some of the laws in Europe that are going on where if you have any questions about the long-term value of the migrant crisis, well, you can get a visit from the police and you can get dragged off to court.
And it is really a terrifying situation.
And the majority of people will support these laws, otherwise they'd be struck down.
Angela Merkel recently allowed the Turkish president to sue a German comic who made fun of him.
Absolutely astounding.
The degree to which freedom of speech has been abandoned, and this is the general accumulation of creeping fascism that comes from the hysteria of political correctness, which is weak-minded people coming into the public discourse unprepared for the bruises and cuts they're going to get from public discourse.
Public discourse is, and rightfully so, a very bruising and brutal affair, because we are talking about the giant levers of power that create or destroy civilizations.
It should be A prize fight.
You should go in not expecting to have the same number of teeth when you go out as when you go in.
It should be a bruising and bloody occupation and a lot of people who just aren't that smart or aren't that strong have been kind of pushed in through everybody being promoted into college these days.
They've been pushed into the public discourse and they're screaming, you know, like a girl guide, you accidentally step on their foot, you know, they're screaming that it's all brutal and it's all assault.
But when I grew up, Anybody who cried out in pain during a debate automatically lost and was no longer considered to be robust enough to have an intelligent discussion with.
So I think when I reviewed that, looking at it again this morning for the first time in years, I was really struck by the degree where I said the system is near the end, the horizontal attacks are going to increase, and what's interesting, I also talked about demographics, which I completely forgot about because I had a graph of German birth rates since before the unification of Eastern and Western Germany and afterwards.
And I said, intelligent human beings do not breed well in captivity.
And so seeing all of that, I was amazed at how prescient it was, and how much of my predictions I had forgotten, which is kind of But that was one of the things that really struck me.
And I really appreciate you, Mike, bringing that back to sort of my attention because watching it again, it really reminded me just, yeah, what a good video it is, how prescient it was, how accurate it has been, how valuable it is for people to watch.
And yeah, I should do more like that.
Yes, you should.
It's just important for us all to learn as much as we can, as quickly as we can right now, because I see humanity as being at a great turning point.
The world has become so connected, and even with All of these stupid governments where we draw lines on a map that don't really exist and we allow the people that we hire to tell us what to do,
we allow them to scare us into believing that the people on the other side of that imaginary line are different than us and thereby control us even more once they've convinced that there's this threat from the people on that other side of the line.
This is something that really needs to go away in humanity.
You need to stop the follow the leader mentality, and the internet is providing that, but we are at a moment in history right now.
The next I don't know, 30 years or 50 years.
You know, in the last video we did together, I talked about how prosperity compounds and how every transaction is connected.
And if you destroy one transaction today with a rule, a regulation, a law, whatever, whatever policy a government puts in place, that means prosperity is permanently crippled out into the future.
You can never go back and replace that transaction.
If I make a dollar today, it's going to become a dollar that I am going to spend sometime in the future.
If I don't make that dollar today, I'm not going to spend it in the future.
And so, the more transactions that we have, the greater our prosperity will be out in the future.
And when you know that the maximum amount of transactions comes with the maximum amount of freedom Then it's a very, very simple equation.
I mean, you can say that the more freedom that you have, the brighter our future is going to be.
We really should have conquered, you know, If you take a pharaoh from ancient Egypt, and the poorest people today live far better than a pharaoh.
I mean, if you've got a cell phone, if you've got the ability to access food that was provided through refrigeration, you're living better than the richest person on the planet did a thousand years ago or even just a few hundred years ago.
If you live in a society that has sanitation, if you've got plumbing, you're living in a place where you're probably not likely to die from some disease as Napoleon was or even the Founding Fathers in the United States.
The poorest people in society live better than kings and pharaohs did thousands of years ago.
And so if we had never impeded transactions through government policy going back thousands of years ago, we were talking about this in the last video, it's not possible for us to conceive of the level that we could be living on as a potentially Interstellar species.
So we need to stop impeding the number of transactions that go on today.
And that impediment is always connected with governmental policy.
It's connected with the follow the leader mentality, having to hire somebody to tell us what to do.
Will we obviously be collaborating in the future at your place since it's warmer on a state-begone spray?
You know, just be a spray, and it drives back politicians and exposes the false promises for what they are.
All right.
Well, I just wanted to thank you a lot for the conversation.
Of course, always a great, great pleasure to chat.
Also remind people, goldsilver.com, and we'll put a link to your book below, which is, you know, common sense, essential reading for the exciting economic times we're heading into.
