The Case for Economic Freedom: Why Governments Often Make Prosperity Harder

[00:00:00] Speaker 1: We are here to help create the jobs and future you deserve. Politicians always claim they're going to improve our economy. We will transform our economy. But again and again, government makes things worse. President Reagan was right to say. [00:00:18] Speaker 2: The nine most terrifying words in the English language are, "I'm from the government and I'm here to help." [00:00:26] Speaker 1: That's because an economy runs best when the government gets out of the way and lets free market competition work. The more we abandon free markets, the more we move away from free markets, the worse things become. Economist Don Boudreaux's new book explains the benefits of economic freedom. The subtitle, "Debunking the Seven Great Myths of American Capitalists." Good subtitle. But the title, "The Triumph of Economic Freedom." Economic freedom is losing. Republicans and Democrats are voting against it. [00:01:00] Speaker 3: Right, but when you look at history, you see that when economic freedom is allowed to flourish, it does triumph. And part of the reason we wrote this book is to correct some fallacies that people have about our economic past in order that they'll support better policies moving forward. [00:01:16] Speaker 4: The coronavirus presents a public health emergency in the United States. [00:01:20] Speaker 3: This decade of 2020 has been pretty bad. It begins with COVID. We get the terrible Biden administration. [00:01:26] Speaker 5: America is a nation that can be defined in a single word. I was in the foothills of the Himalayas with Xi Jinping. [00:01:36] Speaker 1: Biden's policies increased inflation. He canceled needed pipelines. He gave billions to politically connected companies. Now it's President Trump who's interfering with the market. [00:01:49] Speaker 3: The second Trump administration is doing a lot of damaging things like taking golden shares in American corporations. [00:01:55] Speaker 6: We did keep a golden share. [00:01:56] Speaker 3: And his tariffs restrict trade. Free markets are on the ropes now. And it's really important that people step back, look at economic history, the history of our country. And if they do that, they'll see that we prosper more the more economically free we are. [00:02:13] Speaker 1: Countries benefit when politicians do less. Google, Facebook, OpenAI, NVIDIA, Tesla, all began in the United States. Because compared to Europe, our government mostly lets the free market work. Yet today, young people blame free markets for every problem. Every problem. [00:02:35] Speaker 3: Yeah. Because they don't know what they're talking about, these young people. They should read my and Phil Graham's book. Because we explain that free markets in the past have worked pretty well. And that the government solutions to whatever problems existed actually made things worse. [00:02:50] Speaker 7: We can't buy a home. You want to be able to work and provide for your family, but you can't afford to work either because you can't afford daycare. [00:02:56] Speaker 3: People say they can't afford homes. They can't afford daycare. It's true that housing and daycare are rising in prices. Well, housing is rising in prices chiefly because of government. Land use restrictions reduce the supply of housing. It restricts building. Rent control reduces the supply of rental housing. And that especially hurts young people because they are the ones who are going to be more likely to rent. Daycare is riddled with government regulations on who can supply it and how they can supply it. All of which raises the cost of those things. And then on top of all this, we have inflation. Inflation is caused by too much money chasing too few goods. That's a government caused problem. The money supply is under the control of the government, not under the control of businesses. [00:03:43] Speaker 8: The growing gap between rich and poor Americans is one of the biggest challenges facing the country. [00:03:48] Speaker 3: Yeah, but if you look at the data, that growing gap isn't growing. That gap is due to a statistical illusion. What's the illusion? First of all, the Census Bureau, which is where those numbers come from, they don't count the handouts given to low-income households, which are large. [00:04:05] Speaker 9: Are you aware that your agency doesn't count non-cash payments from the federal government, or food stamps, or housing subsidies, or utility bill subsidies, or Medicaid, or free school meals? They don't count that. [00:04:23] Speaker 3: I did not know that, and it sounds like something that we should add. They don't count the taxes paid by high-income households, which are also large. Once you take just those two things into account, the measured level of income differences between high-income Americans and low-income Americans shrinks dramatically. And they just don't count it? They just don't count it. Why? The Census Bureau has been asked this. I've never seen a good answer. The government says 11% of the population lives in poverty. Shouldn't government do more to help? That's false. The official measure is 11%, but if you take account of the transfers that are paid to lower-income households, that figure falls to 2.5%. We have basically conquered poverty in America. It's astonishing that we've done it. The typical household in the lowest fifth has about the same amenities in their household as ordinary middle-class Americans had 50 years ago in their households. All of us are getting richer. It's true. Some are richer than others, but that will always be the case. But the absolute level of poverty in America is down to virtually nothing. [00:05:36] Speaker 1: You're right, but you've still got billionaires who have so much more money than other people. It just is wrong. [00:05:44] Speaker 3: Most billionaires in America are rich because they've made us rich. Jeff Bezos is very rich. It's true. Much richer than you or me. But he's rich because he revolutionized retailing. He's made us rich. He's made us rich. No one was compelled to use Amazon.com. We did it voluntarily. We still do it. Every cent of his wealth is well-earned. Bill Gates, by revolutionizing home computing, he made our lives dramatically better. He got himself very rich in the process, but he didn't steal that from anyone. We bought Windows voluntarily. The Google billionaires revolutionized, again, our lives. Who doesn't use Google? It's essential now. We should praise them, not bemoan the fact that they got rich doing it. [00:06:32] Speaker 1: People think there's a fixed supply of money, and if those people have billions, other people must have less. [00:06:39] Speaker 3: That is what people think. Zero-sum thinking is very common. It's very dangerous because it's so wrong. It is true. If there's a fixed pie and you get more, then other people have to have less. But that's not how the market economy works. The pie isn't fixed. People get rich by making the pie bigger, and they take off a slice of that. You know what good research shows? Successful entrepreneurs in the last half of the 20th century, they got really rich. You know how much of their contribution to society they claimed for themselves? About 2%. About 98% of the value of what they produced was captured by consumers and workers. They got 2%. So Bill Gates got about 2% of the wealth that he created. The other 98% is shared among the rest of us. How? Lower prices, better quality products, higher wages for the workers working in the industries producing those outputs. [00:07:35] Speaker 1: And as that better technology gives both consumers and businesses more information, activists find new things to complain about. [00:07:44] Speaker 10: We are seeing online retailers that charge first-time parents more for baby products simply because the retailers know that the new parents are likely to pay more. [00:07:54] Speaker 1: Another anti-capitalist attack is dynamic pricing. Companies charge some people more than others. [00:08:01] Speaker 8: A shady new way to charge you more for something than anyone else is paying. Politicians promise to fix that. [00:08:08] Speaker 11: It's called the One Fair Price Act. It would prevent companies from being able to use customers' personal data to set different prices for each person. [00:08:17] Speaker 3: Yes, there is such thing as dynamic pricing. And you know what economics says? That means that higher income people pay higher prices, which allows lower prices to be charged to lower income people. But they also maybe charge higher prices to dumb people who don't price comparisons. Yeah, but that's not what happens. The evidence is pretty clear. The dynamic pricing, when it exists, raises prices for higher income buyers, lowers prices for lower income buyers. [00:08:42] Speaker 1: And if they did charge stupid people more, what's wrong with that? It would encourage people to shop around. It winds up being a tax on stupidity, and if you tax something, you get less of it. Now politicians say we must act to prevent artificial intelligence from doing bad things. AI is going to take jobs away. [00:09:00] Speaker 3: From time immemorial, people have been claiming that some new invention that saves labor is going to destroy jobs. Some jobs are destroyed, other jobs are created. You can't point to a time in history when we have had labor-saving technology and there's been a net reduction in employment. It just doesn't happen. What happens is, again, some jobs are destroyed, other jobs are created. The jobs that are created tend to be better. Our living standards rise as a result of these innovations. [00:09:28] Speaker 1: There are more people today. I think there'd be even more unemployment because all these jobs, secretaries, elevator operators, phone operators, gone. [00:09:39] Speaker 3: But other jobs are being created. Look, if we had today the same technology that we had 40 years ago, the only web designers would have eight legs. So we get these new, wonderful innovations. They do destroy some jobs. Other jobs are created. They are better jobs. And that improves the economy. Economic growth requires change. And that requires some businesses and some jobs to be destroyed as other jobs and other businesses are created. People don't like change. People might not like change, but you can't get economic growth without it. Economic growth comes from innovation. It comes from new ideas, both for new products to produce and new ways to produce existing products. That's the only way you get economic growth. Innovation by its nature is change. You simply can't imagine innovation that doesn't change things. That's what we mean by innovation. And so in order to have growth, if we want our children to live better than we live and our grandchildren to live even better, we have to be open to innovation, including labor-saving innovation. [00:10:43] Speaker 1: But change frightens some people, and politicians respond. [00:10:47] Speaker 12: Lawmakers at the state capitol are considering putting limits on how many self-checkout lanes can be used at once. [00:10:54] Speaker 7: Lawmakers require stores to have one regular lane open for every two self-checkout stations. It also means stores would need one employee for every two self-checkout stations to monitor them. [00:11:05] Speaker 3: How does government know what the right number of workers in any business is or should be? That's up to those businesses. It's in their interest to run their companies as efficiently as possible, which keeps down prices. When government does things like this, that's going to raise the prices. So the same people who are complaining about prices going up, they should be the first to welcome labor-saving technology if that technology reduces costs. [00:11:29] Speaker 1: But people say, "It's also my government's job to protect jobs," and they're protecting those clerks' jobs. [00:11:36] Speaker 3: Job churn in America is enormously high, and it always has been high. And the unemployment rate today is pretty low. It's only like 4.5%, 4.6%. So we don't have an unemployment problem in America today. [00:11:50] Speaker 6: The whole world was robbing us blind. They were stealing our jobs, our money, our factories. [00:11:57] Speaker 3: Trade is bad, and it takes jobs away. It's just wrong. Trade doesn't take jobs away. When we buy stuff from foreigners, they get our dollars. What do they do with those dollars? They spend those dollars in America. That creates jobs. They also invest some of those dollars in America. That, too, creates jobs. You can't find any evidence that increased trade causes more unemployment. It's just not there. Well, it takes some people's jobs. But it creates jobs for other people. Lots of things take people's jobs. New labor-saving technology takes some people's jobs. Changes in consumer preferences take some people's jobs. The decline in the birth rate takes some people's jobs. You have fewer Americans working making diapers today than you did 50 years ago. America has about 4% of the global population. 96% of human beings live outside of America. Why would we suppose that all the best ideas are in that 4% of Americans? If we block ourselves off from trade with the rest of the world, we're blocking ourselves off from 96% of all the good ideas. Well, we'll let their ideas in, but not so much of their stuff. Well, their ideas are in the stuff. The reason we buy products from foreigners is because they have innovative ideas that make those products attractive to us, and that's why we buy them. For example, parts for the iPhone are made all over the place. Why is that a good thing? The iPhone is made all over the place. So what that means is the idea people in Cupertino, California, that makes their work more valuable. It's precisely because they can hope to sell iPhones at lower prices because we can produce those parts in lower-cost countries that inspires those people in Cupertino to work really hard to come up with new consumer electronics, new and better iPhones. [00:13:52] Speaker 1: Seattle's new socialist mayor pushes policies that would lead us to producing less. Her government will make sure that people have more leisure time. [00:14:01] Speaker 13: You should have time to read a book and lay on the grass staring up the clouds. Because we need bread, but we need roses too. [00:14:11] Speaker 3: This appeals to people. Those are pretty words, but what business is it of the government to decide how people should spend their time between work and leisure? That's an individual decision. Why should the government put its finger on the scale to make life nicer? If you're trying to make life nicer for me by reducing my opportunities to work, and if I want to work more, you're making life worse for me, not nicer. I can smell the roses on my own time. Thank you. [00:14:37] Speaker 13: Access to affordable, healthy food is a basic right. We cannot allow giant grocery chains to stomp all over our communities, close stores at will and leave behind food deserts. [00:14:47] Speaker 3: What she's proposing, no doubt, is to prevent stores that are already operating from closing or downsizing. Once she does that, what she'll find is that fewer stores will move in in the future. And so the long run effect will be fewer grocery stores in Seattle. They don't understand this? Apparently not. They just don't think about it. They just don't think about it. They see the immediate effect, but nothing beyond that. [00:15:11] Speaker 1: There's this Texas representative who just won a primary. I believe healthcare is a human right. [00:15:17] Speaker 3: We need universal coverage. But what he means by that is that government should pay for healthcare, which means that government should force all of us to pay for the healthcare of the rest of us. [00:15:28] Speaker 6: And with the new healthcare law, more good things are coming. [00:15:32] Speaker 1: Government already dominates healthcare thanks to programs like Medicare, Medicaid, Obamacare. But the activists always want more, including absurd things, like this Minnesota legislator's push to study the benefits of shoplifting. [00:15:48] Speaker 14: Study sort of the benefit of shoplifting and of retail theft, because perhaps people are relying on that and sort of using that. Maybe it's, you know, assisting them in some way. Maybe it's assisting them in some way. [00:16:00] Speaker 3: Well, let's then also study the benefits of pickpocketing and armed robbery and burglary. After all, those people get some income from that. Maybe we should be open-minded and embrace those activities. These politicians just want to be kind. It's not kind to people who are victimized by shoplifting. By the way, shoplifting, of course, raises the cost of operating supermarkets and grocery stores. So if we are soft on shoplifters, that's going to raise grocery prices. And that's going to raise the prices that low-income families have to pay for food. [00:16:33] Speaker 1: Boudreau's book also debunks myths about the Great Depression. The stock market fell 11%. This day marked the beginning of the Great Depression. [00:16:41] Speaker 3: Oh, the depression started before the stock market fell. It fell. No one believes that the stock market crash is the cause of the depression. It was a response to what was happening. But that's what these people said. [00:16:51] Speaker 12: On October the 24th, 1929, a day that became known as Black Thursday, the entire stock market fell 11%. This day marked the beginning of the Great Depression. By the 1930s, overproduction had created a crisis. [00:17:06] Speaker 3: That is the myth, but in fact, it's false. Why is it false? The crisis was caused not by overproduction. The crisis was caused by an underproduction of money. The Federal Reserve, starting in 1930, allowed the money supply to drop by 30%. This is one of Milton Friedman's great findings, Milton Friedman and Anna Schwartz. And they blamed the depression on that. And that is what most economists understand today as being the spark for the Great Depression. Today, the Fed prints lots of money. Yeah, it shouldn't. But it would have prevented the depression. Maybe it'll help now. Well, the Fed should not have allowed the money supply to shrink. That doesn't mean that the Fed should print money indiscriminately. [00:17:47] Speaker 1: Which it's doing now? Too much, yeah. Yet leftists say the depression lasted so long because government didn't do enough. [00:17:55] Speaker 4: What did President Herbert Hoover say when people said what should be done? He said nothing. Everything will be fine. Herbert Hoover basically was a do-nothing president. [00:18:07] Speaker 3: Now, Hoover was an active interventionist. Hoover put the government into action to fight the depression unprecedentedly in a way that no president had done before. Doing what? Trying to keep wages and prices from falling. That had never been done before, which is exactly the last thing you want to do when a depression is coming. He created the Reconstruction Finance Corporation, which was designed to get government more involved in reconstructing the economy. None of these things had been done prior to the Hoover administration. [00:18:39] Speaker 1: They passed the David Spakin Act to make sure that on government projects workers would be paid the prevailing wage. [00:18:47] Speaker 3: Yeah, so they were raising wage rates. And the problem in a depression is you have unemployment. You don't want to raise wages further. That only makes unemployment worse. It makes it less attractive to hire workers. They passed the Smoot-Hawley Tariff, raising tariffs about 20%. Yeah, terrible, terrible. It didn't cause a depression, but it certainly made it worse. And it led to a collapse in worldwide trade. [00:19:10] Speaker 1: How does that make things worse? So then America, I would think, would have new jobs making those things. [00:19:16] Speaker 3: Well, we didn't get new jobs making those things because when trade collapses, not only do we import less, we export less. And that's what happened. That means we have fewer Americans working to produce things for export. And that was a consequence of the Smoot-Hawley Tariff. The Smoot-Hawley Tariff was one of the contributing factors, not the main one, but one of the contributing factors to keeping the depression going as long as it did, to keeping unemployment higher than it would otherwise have been. [00:19:43] Speaker 15: Lengthening breadlines and a whole new class of citizens appears in American society, the new poor. [00:19:50] Speaker 3: By the end of the Hoover administration, unemployment was approaching 25%. [00:19:54] Speaker 4: Herbert Hoover basically was a do-nothing president. Why do they call him the do-nothing president? It's a myth. [00:20:02] Speaker 3: Hoover did less than Roosevelt, but he did a lot. [00:20:06] Speaker 1: FDR did more. [00:20:07] Speaker 14: A new deal for the American people. [00:20:11] Speaker 10: People felt that FDR had saved their lives. [00:20:14] Speaker 14: FDR got us out of the depression. [00:20:16] Speaker 1: What people think is that FDR saved America. He created government programs that pulled us out of the depression. [00:20:23] Speaker 3: Well, he created government programs, all right, but they did not pull us out of the depression. Unemployment in the 1930s never was below 10%. It's widely recognized that the 1930s was a solid decade of a depressed economy, despite the New Deal programs. [00:20:39] Speaker 1: While all these New Deal programs were happening and being praised, we stayed in the depression. We stayed in the depression. We've always had booms and busts. What made this worse? [00:20:50] Speaker 3: Two things. Number one, the magnitude of the failure of the Federal Reserve, which allowed the money supply to fall dramatically. Second, the New Deal. By introducing these new unprecedented programs, the New Deal made investment in America a very risky project. And so that kept private investors on the sidelines. When private investors are on the sidelines— Why would they be on the sidelines? Because they're scared of what's going to happen to their property. They're scared that it's going to be confiscated by the government, that the fruits are going to be taxed at confiscatory rates. And so as long as that was—the New Deal programs were in place, and FDR is out on the hustings criticizing business people. [00:21:33] Speaker 16: These economic royalists complain that we seek to overthrow the institutions of America. What they really complain of is that we seek to take away their power. [00:21:53] Speaker 3: And blaming business people for all that ails America, those same business people were saying, Well, okay, I'm not going to trust my property to you. And that made the Great Depression great? That made the Great Depression last as long as it did, and they kept unemployment as high as it was for a long time. [00:22:08] Speaker 1: They passed the Agriculture Adjustment Act, boosting prices by reducing surpluses. [00:22:14] Speaker 15: Farmers are paid not to plant, ordering crops plowed under, and millions of acres of wheat, cotton, corn are left unplanted. [00:22:23] Speaker 3: People were hungry, and they were destroying food. How is that good? It raised prices. Farmers wouldn't go bankrupt. People can't eat prices. They have to eat food. And FDR was destroying food. Destroying food how? What things did they do? They were slaughtering chickens. They were burning crops. And all that reduced supplies, which causes prices to go up. But, again, people don't eat prices. They eat food. They wear cotton. And the government's destroying these things in the middle of the worst depression in American history. [00:22:57] Speaker 17: The government decided to help fellow with his pistol just up there. Pow, pow. Shot those cattle right on the ranch. [00:23:09] Speaker 5: They're plowing up cotton instead of picking it down Dixie Way as a part of President Roosevelt's stupendous program. [00:23:14] Speaker 3: Yeah, it's stupendously stupid to reduce supplies in a depression when people don't have enough supplies to consume. The problem with the depression is people weren't able to consume enough. And here you have the New Deal programs destroying valuable resources. [00:23:31] Speaker 5: Destroying 9 million acres of the fluffy stuff. In return, the government is distributing $120 million to the cotton planters to compensate them for waste land. Happy days. [00:23:41] Speaker 3: What a stupid thing to do during a depression. To destroy valuable outputs and then to pay the farmers for the destruction. So you're denying to Americans the access to the cotton and you're taxing Americans in order to pay for the destruction of the cotton. Just dumb. But this is public broadcasting saying yay! Yeah, consider the messenger. Why don't people get it? You asked the $64 trillion question. They think that the New Deal and the Roosevelt administration have a glorious reputation in America now. We think that they were saints and brilliant engineers to get us out of the depression. It didn't work. [00:24:26] Speaker 18: Vital to the communities which they serve are the thousands of miles of highways constructed and improved by the works program. [00:24:32] Speaker 1: He created the Civil Works Administration providing jobs, fixing roads and bridges. [00:24:39] Speaker 3: He did do that and there were some roads and bridges that were fixed, but those were basically government employees. The reason he had to do that is because his policies kept private employers from hiring those workers. [00:24:53] Speaker 16: We had to struggle with the old enemies of peace, business and financial monopoly, speculation, reckless banking. [00:25:03] Speaker 3: Here are government officials who are responsible for the Great Depression, blaming businesses for the evils that were wrecked on the American economy by those same politicians. These aren't the enemies of peace? Commerce is the friend of peace. The enemies of peace are governments. Why is commerce the friend of peace? Commerce makes it in the interest of both sellers and buyers to cooperate with each other. You don't shoot your customers. You don't shoot your suppliers. [00:25:31] Speaker 12: It wasn't until the start of World War II in 1939 that the Great Depression truly ended. [00:25:37] Speaker 3: Not true. Unemployment fell, but that's not hard to do when you conscript two and a half million men into the military. Some people say war is good for an economy. Nonsense. In addition to the fact that war kills people, war makes the economy poorer. It's true, you get more production of bullets and bazookas and tanks, but those bullets and bazookas and tanks are produced with things that would otherwise be used to make things like toasters and automobiles and automobile tires and better housing. And so you get our standard of living falls as a result of war. It may be necessary to fight the war, but you shouldn't believe it's going to increase our economic prosperity. It decreases our economic prosperity. But if you look at the actual performance of the economy, for example, investment, that didn't recover until the late 1940s. And it recovered because? Two reasons, basically. The Republicans surprisingly won the 1946 election, and they were more pro-investor, pro-business than were the Democrats. And FDR died in April of 1945. And Harry Truman was just much less vigorously opposed to capitalists as FDR had become by the end of the depression. And so investors finally, by the end of the war, with the Republicans taking control of the House, with a much more moderate president in the White House, investors were finally confident to come back into the playing field. It was about confidence? It was about confidence. It was about confidence. First, the Hoover administration, and then increasingly the Roosevelt administration, destroyed investor confidence. Investment was negative for most of the 1930s. And if investment is negative, there's no way an economy is going to recover from a downturn. The war artificially increased employment, but it did nothing to bring back economic buoyancy. That didn't happen until after the war. And explain how confidence matters. If you're an investor, if you think that your investments may be seized by the government, if you think the returns are going to be taxed at a confiscatory level, if you're not sure that you'll be able to honor the contracts that you make with your suppliers or with your workers, you're much less likely to put your money into those long-term investments. And that's the way investors felt throughout the 1930s. [00:27:59] Speaker 6: To help people realize the dream of owning their own home. [00:28:02] Speaker 1: We want more people owning their own home. 70 years later, politicians created the Great Recession by subsidizing mortgages. Yep. That's what they did. [00:28:14] Speaker 3: But mortgages are good. Owning a home is good. If you can afford it. But what the government did was impose policies that made homeownership seem affordable to people who couldn't afford it and compel banks to create those mortgages and to back those mortgages. But these were mortgages being pushed on people who really couldn't afford them. And so when things went down, when things went south, and those mortgages went to default, you had this huge calamity in the financial system. [00:28:46] Speaker 16: Falling home prices and rising unemployment. [00:28:49] Speaker 1: President Obama blamed deregulation. The absence of a working regulatory regime over many parts of the financial system and over the system as a whole led us to near catastrophe. [00:29:02] Speaker 3: It's one of the great fallacies that deregulation led to the Great Recession. There was very little deregulation prior to the Great Recession. And in terms of banking, there were four new banking regulation statutes passed between 1980 and 2007. And of course, that was a banking crisis that we had with the Great Recession. So he knows this and he's making it up for political purposes? He's a politician. He needs a bad guy to blame. And rich people are bad guys. [00:29:29] Speaker 1: If you've got a business, you didn't build that. You didn't build that? Yeah. Yeah. Well, you laugh. But it's true that those who build businesses do it with the help of government, which builds roads, and government, which may train people, etc. [00:29:45] Speaker 3: That's true. And those roads and that training was paid with taxes. Taxes are overwhelmingly paid by wealthy Americans, by business people, by successful business people. So they paid for these things in the past. We expanded unemployment benefits, a measure that's already made a difference in the lives of 12 million Americans. Yeah, well, it did. It kept them unemployed for a lot longer. The depression in jobs, the long-run unemployment rate after the Great Recession was the longest in American history after any recession except the Great Depression. Because of all these programs? Yeah. Yeah. Because people were being paid not to work. [00:30:26] Speaker 16: These economic royalists complain that we seek to take away their power. [00:30:35] Speaker 3: One thing's pretty certain, that FDR's negative comments about business people, his open hostility to business people, helped prolong the Great Depression. It's no coincidence that one reason the Great Recession lasted as long as it did is because Barack Obama was likewise saying hostile things about markets and about business people. [00:31:00] Speaker 1: I do think at a certain point you've made enough money. [00:31:02] Speaker 3: In both cases, those negative words from the White House kept investors on the sidelines, kept unemployment higher than it would otherwise have been. I'm a businessman first. So now we have a president who was a businessman. He's better? He's less hostile in some ways to business than was Barack Obama, of course. In some ways, I think he's worse. His tariffs are bad. His antitrust policy is bad. But he is a little bit more pro-deregulation. He is a little bit less likely to use high taxes to confiscate the fruits of profitable investments. And to that extent, it's an improvement. Grabbing chunks of companies? [00:31:40] Speaker 6: I think the United States is entitled to 10% of your company. Terrible. [00:31:44] Speaker 3: Terrible. [00:31:45] Speaker 1: Terrible. He says it gives American taxpayers a share. [00:31:48] Speaker 3: To say it gives Americans a share of these corporations is to say it gives government a share of the corporations. That's government control of the means of production. That is classic socialism. It's definitely a move down the road to socialism. So in that way, Trump is more hostile to capitalism. [00:32:09] Speaker 1: I thought socialism is when they own the business. They just own 10%. Yes. [00:32:14] Speaker 3: They don't own the full business, but they own these golden shares or whatever they're called, which gives the government disproportionate decision-making power in the business. And that's what matters. The businesses are going to be run in the way the governments want them to be run, not according to the profit and losses of the market. [00:32:33] Speaker 1: That assures that the business is run to help the majority of the people. Because the politicians are trying to be elected. [00:32:42] Speaker 3: Well, if that were true, then socialism would have a marvelous record of success in history. And it doesn't. It doesn't? It doesn't ever work? I don't know of any examples. It's been tried by lots of countries. Soviet Union, Eastern Europe behind the Iron Curtain. African countries, Latin American countries. Cuba, Venezuela. None of these places are successes. They're all basket cases. And they were all, to one degree or another, socialist. And the more we abandon free markets, the more we move away from free markets, the worse things become. The more oppressive governments become. [00:33:15] Speaker 1: Tom Bedreau teaches economics at George Mason University. You can see more of his work at CafeHayek.com. And if you like this longer than usual conversation, please click there to help us bring you more.