In honor of Joe Rogan's recent appearance on his show, Joe and Peter discuss why they chose to live in Connecticut, why they moved to the US from Puerto Rico, and what it's like to be a college student in the summer in Puerto Rico. They also discuss Joe Biden's chances of winning the election and why he should have been on the campaign trail in the first place. They also talk about why they decided to move back to Puerto Rico and why it's a great place to live. Finally, they talk about their plans for a Puerto Rican summer home and why they don't want to go back to school in the fall. Joe also talks about why he thinks a woman should be the next president and why she should win the election. And they discuss why he doesn't think Trump should be re-elected and why Hillary Clinton is a better choice than Joe Biden. They finish the episode with a special guest appearance by Peter and Peter's family. Thanks to Peter and Joe for coming on the show and for being on Joe's show. Thank you to Peter for being a good friend and for letting us use his music and for his music stylings. Also, thank you for being Joe for being kind enough to let us use your music. and for producing this episode of Joe's music. Thank you for listening and supporting the show, Peter for making us all feel good about this episode. We really appreciate it. - we really do appreciate it, Joe, we really appreciate you, we love you, and we appreciate you! Joe and Pete, too. See you, Joe and we hope you're listening to this episode and we re listening to it, and you re listening and listening to us, too, and supporting us, we re voting for us in the next episode of Thank You! - Thank you, Peter and we can t wait to see you in the future of this podcast. -- we re going to vote for you in 2020! -- P.S. -- Thank you so much, Joe's Music: -- -- and we ll be back in 2020. -- -- Thank You, Peter's Song: "The Revolution of the United States" -- by: Joe's Backyard -- by Mr. Soto (featuring: The Good Life -- by The Good Thing (feat. ) -- The Good, the Bad, the Good, The Bad, The Good and The Bad and the Good Thing, and the Great, The Great, and The Good Morning, and So Much More
00:02:30.000You can't beat the tax breaks, so this is going to be an important thing, especially if Biden ends up winning, which it looks highly likely that that's going to be the case.
00:02:40.000I think a lot more people are going to be coming down there to try to escape what will be real confusion.
00:03:28.000I don't think they're going to have them, though.
00:03:29.000But the big problem for Trump, and I voted for Trump the first time.
00:03:36.000And, you know, I was initially going to vote libertarian, which is something I do.
00:03:40.000And by the way, there's a candidate, Joe Jorgensen, who you should have on your show.
00:03:44.000I don't know if you've thought about it, but there is a woman running for president, and she will be on the ballot in every state, Joe Jorgensen from the Libertarian Party.
00:03:53.000And so everybody who thinks there should be a woman president, I actually agree right now, and that's who we should elect.
00:04:46.000And normally I vote for the lesser of two evils anyway, and most of the time I vote for the loser.
00:04:51.000So as far as I'm concerned, giving up my right to vote for the loser, It's not much of a sacrifice.
00:05:20.000Voting for anybody, it doesn't really matter who you vote for in a state like Connecticut.
00:05:25.000But as I was saying, the problem for Trump, and I was one of the few people who was in the media saying that I thought Trump had a real good shot at winning.
00:05:35.000I didn't know it was in the bag, but I thought that he was more likely to win than lose, even though everybody thought it was a long shot.
00:05:42.000And the reason that I thought that Trump could win is because Trump was telling the truth About how bad the economy was.
00:05:51.000He wasn't regurgitating the lies that the Obama administration had been telling or that Wall Street had been telling about how we had a real recovery.
00:06:00.000I knew that we had a bubble inflated by the Federal Reserve.
00:06:05.000Where you can see the stock market at record highs and these phony unemployment numbers, I knew laid a weak economy.
00:06:21.000About how we were a shadow of our former self, that our industrial might had decayed, we had all these big trade deficits, that the stock market was a bubble, all the numbers were fake, the real unemployment number rate wasn't 5%, but 20%,
00:06:36.00030%, 40%, and that he was a non-politician, he was going to clean house, he was going to Drain the swamp.
00:06:44.000He was going to put politics aside and bring a businessman's perspective to Washington.
00:06:55.000And that message resonated with a lot of people.
00:06:58.000And a lot of those people were maybe afraid to be honest with the pollsters because they didn't want to admit that they were going to vote for this racist, misogynist or whoever the media was portraying him.
00:07:39.000All of a sudden, all the government numbers that were fake under Obama were all of a sudden real, like they just came down from God on a tablet on Mount Sinai.
00:07:48.000And he began talking about this low unemployment and this booming economy, the greatest economy in the history of the world, the greatest economy ever.
00:07:57.000And so you have the same people who voted for Trump thinking that he would shake things up, thinking that he would throw a monkey wrench in the system and make their lives better.
00:08:11.000The trade deficits that Donald Trump criticized are bigger now than they were before he was elected.
00:08:17.000And obviously the deficits are much bigger even before COVID. So I just don't see how Trump convinces those swing voters, those blue-collar Reagan Democrats in the Rust Belt who decided they had nothing to lose and so they take a chance on Trump.
00:08:42.000But, you know, once you're the insider and Trump's now the insider, you know, he doesn't have that edge for re-election.
00:08:49.000What do you think went wrong and why do you think Trump just made the swamp deeper?
00:08:53.000Do you think that he was deceptive when he was running or do you think the influences once he got into office were greater than he anticipated?
00:11:07.000See, when the government takes our money through an income tax, they take my money that I earned and they give it to somebody else who didn't earn it.
00:11:21.000The government took it from me in taxes.
00:11:23.000But if the government doesn't take it from me, they just print money and they hand it to somebody else who didn't earn it and didn't do any work, didn't produce any goods or provide any services.
00:11:32.000They just got money from the government.
00:11:35.000That still costs me because what happens is when that money is spent in the circulation, it bids up prices.
00:11:41.000And so prices are now higher than they would have been had that new money not been printed.
00:11:46.000And so now everything that I want to buy costs more than it otherwise would have cost.
00:11:51.000Either the prices went up or it prevented prices from going down.
00:11:55.000And so now my purchasing power has been diminished.
00:11:58.000And so either the government takes your money Through an income tax or a sales tax or something, or they take your purchasing power through an inflation tax.
00:12:08.000And so that's what Trump decided to do, to pay for government through inflation rather than taxation.
00:12:13.000But what we know from history is that is the most expensive way to pay for government.
00:12:18.000And in fact, it hits hardest the middle class and the poor.
00:12:22.000Because the rich have a lot of assets, they have a lot of debt, not consumer debt like on a credit card, but where they borrow money to accumulate income-producing property, to buy companies, stocks, things like that.
00:12:38.000If you have debt to buy assets, inflation wipes out your debt.
00:12:43.000But if you're just saving money and working for a living and getting a paycheck, The inflation tax is very heavy on you.
00:12:49.000And that inflation tax is going to get much, much higher under Biden.
00:12:54.000For all the talk about all these big government programs, and we'll talk about that, that he wants to pay for by taxing the rich, the rich aren't going to pay those taxes.
00:13:03.000Most of the money is going to come from the poor and the middle class through the inflation tax.
00:13:08.000But getting back to where I think Trump went wrong.
00:13:11.000So Trump gets into office and he had promised to make America great again.
00:13:16.000And the reason that America is not great is because government is too big.
00:13:20.000When America was great, we had very, very small government.
00:13:55.000The greatest economy in the history of the world was produced from the freest people in the history of the world, which was the United States.
00:14:03.000Well, Trump wanted to make America great again.
00:14:05.000The only way to do that would be to shrink government, cut government spending and free up all those resources back into the private sector so that they can be used efficiently again.
00:14:15.000But the problem is, how do you cut government spending when every single program has its own constituency that benefits from it?
00:14:23.000And so once you're there, you can't cut anything unless you're willing to stand up to all the politicians and the special interest groups.
00:14:31.000And apparently Trump wasn't willing to do that.
00:14:33.000I mean Trump, when he got into office, became a politician.
00:14:38.000Maybe he was one when he ran for office, but he was more concerned about getting re-elected, which is a shame because he probably won't.
00:14:45.000He should have used the bully pulpit and used his office right away to level with the American public, to look him square in the eye and tell them that government is too big and spending needs to be cut.
00:14:58.000Including things like Social Security and Medicare and all these sacred cows that nobody would gore.
00:15:03.000Trump should have been the guy to do it.
00:15:05.000He should have said the buck stops with me.
00:15:07.000I don't care if I don't have a second term.
00:15:09.000And he should have vetoed all of those bills that he signed.
00:15:13.000He never should have agreed to allowing the debt ceiling to go up.
00:16:46.000And, you know, you've got a great audience, and I'm hoping to clear up a lot of misconception out there, because I've been saying, you know, the only thing that spreads faster than the coronavirus is ignorance, you know, about economics, about finance.
00:17:34.000The bubble was already deflating before COVID. It started to deflate in the fourth quarter of 2019. That's when the Federal Reserve stopped hiking interest rates and then started cutting them again and started doing quantitative easing again.
00:18:04.000Trump was very critical of Janet Yellen during the Obama years, rightly so.
00:18:11.000Because Yellen kept interest rates artificially low to make Obama look good by propping up the stock market and the real estate market with cheap money.
00:18:22.000But doing that is what prevented a real recovery that would have benefited Main Street.
00:18:27.000And so those are the people that Trump was tapping into.
00:18:30.000The guys on Main Street that were getting screwed as the guys on Wall Street were being enriched by bad monetary policy.
00:18:38.000So Trump was right to criticize Yellen.
00:18:41.000And then he didn't want to reappoint her because supposedly he was going to reappoint somebody that would do the right thing.
00:18:47.000But as Powell was doing the right thing, albeit too slowly, Powell started to correct the problem by raising interest rates and shrinking the balance sheet.
00:18:56.000But when that began to impact the markets, Trump was like, oh, he started criticizing him.
00:19:14.000The real estate market's going to go down.
00:19:15.000We're addicted to cheap money like a drug addict is addicted to heroin.
00:19:19.000But if you've got a guy addicted to heroin, the solution isn't more heroin so he stays high.
00:19:24.000The solution is, okay, no more heroin, and now you're going to go through withdrawal.
00:19:29.000So the economy started to go through withdrawal as the Fed was withdrawing that cheap money, and Trump was like, no, I don't want withdrawal.
00:19:36.000Who's going to vote for me if everybody's hung up?
00:19:59.000And all of a sudden, you know, and I don't even know, I've seen some of your discussions on the podcast about COVID itself and whether or not the threat is being exaggerated.
00:20:10.000Is it really as big a health threat as a lot of people say?
00:20:14.000And, you know, I'm not an expert there.
00:20:17.000You know, I tend to always be suspicious.
00:20:28.000Let's just take them at their word that it's as bad as they say.
00:20:32.000I just want to focus on the economics of it.
00:20:36.000When COVID hits and people start staying home and they're not going out and people start losing their jobs and the economy starts tanking, right?
00:20:47.000The government comes in as if it's the government's job to rescue the economy.
00:20:52.000And the politicians say, in fact Trump himself said, oh we're at war.
00:21:01.000Yeah, it's World War II and we have to sacrifice.
00:21:04.000Americans have to sacrifice to beat COVID-19, the way a prior generation sacrificed to beat Nazi Germany, Imperial Japan, we have to sacrifice.
00:21:19.000Except what we're doing now is the complete opposite of the actual sacrifice that Americans were asked to make.
00:21:53.000And after the victory tax, more than a third of Americans began paying income taxes.
00:21:59.000They weren't paying any income taxes before the war.
00:22:01.000All of a sudden they're paying income taxes and in 1942, They created the withholding tax, which Americans, you know, we pay it today, you think it was always there.
00:22:11.000Up until 1942, nobody had any income taxes withheld from their pay.
00:22:15.000What happened was, if you were among the few people who actually paid income taxes, you didn't write a check until April 15th of the following year.
00:22:42.000And so the Treasury started selling these war bonds to the public.
00:22:47.000And middle class Americans bought the equivalent of trillions of dollars of war bonds.
00:22:53.000So the government taxed the middle class and borrowed from the middle class to pay for the war.
00:22:59.000And this is in 1940. We just went through the Great Depression.
00:23:03.000So these are Americans that just lived through a 10-year depression, the worst period in American history, yet they had enough money to loan trillions to the U.S. government and to pay much higher taxes than they were paying before.
00:23:18.000And in addition, nobody got a bailout.
00:23:21.000No businesses, if you ran a restaurant and nobody was coming to your restaurant because your customers were off We're now working harder to pay higher taxes.
00:24:44.000And if people were disrupted, a lot of people lost money because of World War II. It wasn't their fault.
00:24:50.000If you ran a restaurant and now your customers weren't coming because they went to fight the war, it wasn't your fault that your business dried up.
00:25:33.000But there's a little bit of a delay, so just let me...
00:25:35.000This is one of the reasons why I stress it's so much better to do these things in person, and I understand that it's impossible for you to do that right now.
00:25:42.000When you have a situation like COVID-19 and these medical experts say, hey, we've got to do something.
00:25:49.000We've got to shut down most of what we do.
00:25:54.000We've got to shut down a lot of businesses.
00:25:56.000We've got to shut down schools and make things remotely.
00:25:59.000There's going to be a situation where there's going to be a lot of people that are not going to be able to work, but we want to keep these businesses alive.
00:26:11.000Any situation we've ever faced in my lifetime, what do you think could have been done that would have been a better solution than what the government did in terms of bailouts, in terms of telling people to stay home?
00:26:26.000Well, first of all, you have to remember that the government doesn't have any money, right?
00:26:30.000The government only has money it takes from the people, one way or another.
00:26:34.000Grover Cleveland, who was the president in the late 19th century, he had a good quote, he said, while the people must support the government, the government should never support the people.
00:26:45.000And so I agree, let's say we have to shut down the economy temporarily.
00:26:50.000People should have enough savings to weather the storm.
00:26:55.000Businesses should have enough savings to weather the storm, like they did in 1940. Average Americans had lots of money in the bank.
00:27:59.000There's very few human beings that have enough money to last four months.
00:28:04.000I'm sure you do, and I do, but most folks out there listening don't have enough money to live and feed their families and pay their mortgage or pay their rent and pay their car payments for four months.
00:28:20.000But they're going to end up suffering much more in a year or two or three as a result of the massive inflation that has been unleashed to finance all the bailouts and the stimulus.
00:28:34.000But don't you agree that it's a good idea to do something just to keep everyone alive, just to keep businesses alive, just to keep people in their homes, just to keep...
00:29:13.000Comedy clubs are suffering terribly right now because there's very few states that are allowing people to go out, wear masks, socially distance, and go to comedy clubs.
00:29:24.000LA is not allowing any of that, and they haven't since March.
00:29:27.000The comedy store, which is my home, has been shut down since March.
00:29:31.000All these clubs have been shut down all across the country through no fault of their own.
00:29:45.000If the state of California is going to order businesses shut down, and then the state of California wants to provide some kind of economic relief, let California do it.
00:29:56.000Let California impose higher taxes on whoever they think should fund it.
00:30:01.000We can't just use the Federal Reserve as a piggy bank.
00:30:04.000The Federal Reserve cure is going to do more damage than the coronavirus disease.
00:30:09.000And I think if the states knew that they would have to bear the economic consequences of their own decision making, they would do a better cost-benefit analysis on what they shut down and how they do it.
00:30:21.000Right now, every state is like, oh, let's shut everything down and the federal government's going to bail everybody out.
00:30:26.000So we don't care if we put people out of work because they're going to get these enhanced benefits From the U.S. government.
00:30:31.000Oh, we don't care if we shut down businesses because they're going to get these PPP grants from the government.
00:30:37.000But if the federal government let every state know, look, you make a decision.
00:30:41.000You handle this the way you want and you pay for it.
00:32:53.000You know, trying to prevent bubbles from deflating by trying to blow more air into them just makes it worse.
00:32:59.000Maybe you delay the day of reckoning a little bit, but you make the day of reckoning much worse because now you have additional mistakes that you need to reckon with.
00:33:32.000The free market never would have screwed us up this much.
00:33:36.000It was government interference in the free market.
00:33:39.000That's why, you know, capitalism gets a bad name.
00:33:42.000You know, that's why, you know, we talk about on one of these earlier podcasts about when I went to Occupy Wall Street years ago and I went down to Zuccotti Park because you had all these young protesters who were blaming Wall Street for the bailouts and for the financial crisis.
00:33:57.000And I was saying, no, it's not Wall Street that took the bailouts.
00:34:00.000Blame the government for providing the bailouts, for making them available.
00:34:04.000Blame the Federal Reserve for funding all this and inflating the bubble.
00:34:09.000But, you know, the interesting thing, if I tried to do that today, if I tried to go to one of these protests, one of these Black Lives Matter protests or any of these, you think they'd be civil?
00:34:29.000Yeah, so I mean, it really shows you the loss of civility in just, you know, 10 years.
00:34:33.000Well, it's not just a loss of civility, it's a loss of opportunity and the loss of faith in the system and the future if we stay on the same path.
00:34:45.000People don't believe that if we keep going the way we're going, that things will work out in an equitable, fair, and balanced way.
00:34:57.000And that's where young people today...
00:34:59.000The important point I wanted to make, though, too, when I went back to America in 1940, was to show that the American middle class was real strong.
00:35:09.000They could afford to pay for World War II and to provide for their own families.
00:35:14.000Because now they keep comparing World War II now because we're running up as much debt now as we ran up during World War II. But we had the capacity to pay it back back then.
00:35:27.000Debt to GDP went way down in the decades after World War II because Americans had the capacity to pay back what they borrowed to fight the war.
00:35:55.000And people are able to buy stuff with it.
00:35:58.000But that's going to come to an end because the world is no longer going to accept US dollars as the reserve currency.
00:36:06.000See, that's the unique privilege that we've enjoyed for several generations now and that we've abused to the point where we're going to lose it.
00:36:14.000See, right now we're able to print money and we use that money we print to buy all sorts of stuff that the rest of the world produces that we didn't have to produce ourselves.
00:36:23.000But producing goods requires capital, it requires labor, it requires land, it requires real resources.
00:36:31.000We just create money and say, here you go, and they send us stuff.
00:36:35.000And to make it even better for us, they take the money that we send them, the paper, and they loan it right back to us at very low rates of interest.
00:36:55.000That's going to come to an end because foreigners are going to realize that we're never going to stop printing money, that the deficits are never going to be brought under control, that we're going to have We're not going to be able to import anything anymore.
00:37:12.000And the only things we're going to be able to buy is the stuff we make ourselves, except we don't make much stuff anymore.
00:37:18.000So prices are going to go through the roof.
00:37:20.000That is the real economic consequences.
00:37:22.000And so it's not going to matter that the government sends you a stimulus check if you can't buy anything with it.
00:37:28.000Because the government can't create purchasing power.
00:37:30.000They can print all the money they want, but none of that printed money adds any purchasing power.
00:37:37.000Right, but there is, if the government gives money to people, they will be able to buy things and people still are making things.
00:37:47.000But now, but when the dollar's value collapses, see, you can't keep printing trillions and trillions of dollars and expect the dollars not to lose purchasing power.
00:37:58.000Because paper money, all that does is that allows us to divvy up what we produce.
00:38:05.000You have all these Americans Peter, as an economic expert,
00:38:34.000what would you have done differently if you could have advised this government Let's go back to March when everything was shutting down.
00:38:44.000What would you have advised differently?
00:38:47.000Again, first of all, I would allow the states to be responsible for their own policy.
00:38:53.000So you decide what you want to do in your own state as far as what businesses you want to close, what you want to do, and you I think that certain businesses or individuals need to get money, then the state will provide it based on local taxpayers.
00:39:10.000But what I would have done on the federal level is I would have dramatically cut government spending even after COVID-19 because government spending is a drain on the private sector.
00:39:24.000It's the government taking resources away from the private sector where they would be used efficiently and squander them in the public sector.
00:39:37.000When you say lightened the burden, what would you have cut and how would you do that?
00:39:42.000When you think about all the different aspects of the government that are essential, things that need to be in place, what would you have cut?
00:39:49.000Most of the government money is transfer payments.
00:40:04.000What do you mean by transfer payments?
00:40:07.000Well, that's when the government takes money from one person through taxation and just hands it to somebody else, or now through inflation.
00:40:13.000The government just prints money and gives it to people that it thinks needs it.
00:40:17.000But let's look at the PPP or the CARES Act.
00:40:23.000Look at all the damage We're good to go.
00:41:04.000Most people don't know that these hedge funds got this money.
00:41:08.000Most people think this money went out to American businesses to keep these businesses from collapsing because we need restaurants, we need movie theaters, and all these various American businesses that we assume this money went to prevent from collapsing.
00:41:30.000And according to the Small Business Administration, as long as the money you asked for was less than two million, they didn't ask any questions.
00:41:39.000Because in theory, you are supposed to need the money, right?
00:41:43.000You are supposed to have some disruption.
00:41:44.000Like if you ran a restaurant and your restaurant is shut down, you don't have any revenue.
00:41:49.000There's nobody eating in your restaurant.
00:43:22.000These jobs were never in jeopardy of being lost.
00:43:24.000So all that happened is that it's a windfall.
00:43:27.000The asset management companies and hedge funds, they got extra money from the government to make their profits even bigger on top of the fact that the Federal Reserve printed all this money which inflated asset prices.
00:43:49.000But even in the case where the government is actually giving companies, giving money to companies that need it, that otherwise would have fired their workers.
00:43:59.000Look, we don't know You know, what the future demand for restaurants and bars and theaters is going to be.
00:44:07.000I personally believe that demand is going to be diminished for a long time.
00:45:30.000Now, when you say hedge funds were able to receive PPE and you're saying that they did so while they were still earning profits and there wasn't any diminishment of their income, why were they able to receive PPP? Well,
00:45:45.000that's the problem with government programs.
00:45:48.000Look, whenever the government is giving out free money, people try to qualify for it.
00:45:53.000Now, you know, you can read the fine print that I know a lot of other people could say, hey, you know, Peter had said, as long as your business was affected by COVID. And look, yes, my business was affected.
00:46:02.000I mean, people worked at home that used to work in the office.
00:46:05.000But you had to basically testify or certify that the money was necessary.
00:46:11.000It's necessary to support the ongoing operations of your business, which for most of these firms, it wasn't.
00:46:17.000And you also had to say that you had no other source of capital, which again, people were lying.
00:46:22.000But the government basically said, if you ask for less than $2 million, we're going to look the other way.
00:46:35.000So a lot of businesses that were going to fail anyway and that were going to lay off all their workers took the money, They're still going to lay off all their workers, but now they're not going to have to pay the money back because they're going to bankrupt their business.
00:46:46.000And once your business is bankrupt, even though you fire all your workers, you're under no obligation to repay the loan.
00:46:52.000Okay, did they actually say that if you asked for less than $2 million, we're going to look the other way?
00:47:05.000Because they're saying that if you ask for more than $2 million, we're going to vet the claim and we're going to take a look at your situation.
00:47:12.000But it's said on the Small Business Administration that we'll just assume you're being honest.
00:47:18.000You ask for less than two million, we'll assume you're being honest.
00:47:21.000Well, the minute they say that, ah shit, I'm gonna lie.
00:47:35.000This crazy deal with the enhanced unemployment benefits.
00:47:40.000You have a lot of people now who are being paid twice as much not to work as they were earning when they were working.
00:47:47.000Now, you create that kind of incentive.
00:47:49.000You have a lot of people now, the last thing they want is to go back to work because they're making so much more money not working than they were when they were working.
00:47:57.000And most of these people, if you have a job where you're making, you know, $10, $15 an hour, $20 an hour, chances are you don't love your job.
00:48:06.000I mean, you're not working because you enjoy what you're doing.
00:48:09.000You're working because you need the money.
00:48:18.000I mean, I don't blame anybody for not wanting to work if the government is paying you more not to work than what your boss was paying you to work.
00:48:26.000And, of course, there's more than just working.
00:48:29.000You have to get up early in the morning.
00:49:08.000And that was very shocking to me that people that I know who have friends that are on unemployment don't want the economy to reopen because they would lose money.
00:50:31.000So if you had some people that were making a million dollars a year, they wouldn't cover the whole thing, right?
00:50:35.000It was like, I forget what the limit was, maybe 100 grand a year or something like that.
00:50:40.000But what they did is you could take all of your payroll for all your employees, And the government said, we will give you a loan, no questions asked, for three months of your payroll.
00:50:53.000And as long as you don't fire more than a certain percentage of those people, you never have to pay the money back.
00:50:59.000So it didn't say anything about proving that you actually needed it, proving that, you know, that your revenue went down.
00:51:05.000So the government opened up an opportunity for all sorts of people.
00:51:09.000I mean, I could have had a few hundred thousand dollars if I wanted it.
00:51:12.000All I had to do is lie and claim I needed the money.
00:51:14.000But, you know, look, as much as I don't want the government to have money, and I'm already living in Puerto Rico, so I'm not paying taxes.
00:51:22.000So, I mean, people can say I'm a hypocrite because I'm living in Puerto Rico, but I'm not committing fraud.
00:51:35.000I didn't want to sign a document and attest to the fact that I needed the money when I knew I didn't.
00:51:40.000And what business owner needs the money like that?
00:51:43.000I mean, if you're managing other people's money for a living and you can't handle a downturn in your business, then what business do you have managing people's money if you can't even manage your own?
00:51:53.000I can't believe that anything under 500 employees is a small business.
00:52:30.000But you didn't have to prove because a lot of people's businesses were not disrupted.
00:52:35.000Because if you didn't work with the public in a public setting, if you just sat at a desk and worked on a computer and a telephone, your business wasn't disrupted.
00:52:44.000So why do you need any government money?
00:52:47.000But the point is, even if you needed the money, the federal government shouldn't supply it by printing money.
00:52:54.000People don't realize how much damage we have done to this economy.
00:52:58.000The U.S. government, the Federal Reserve, is doing far more damage than COVID-19.
00:53:12.000Giving your understanding of what's legal and not legal, and the fact that you're willing to move all the way to Puerto Rico to avoid federal income taxes.
00:54:07.000We're gonna have to protect the citizens of the United States from this weird, novel coronavirus that we don't really totally understand at the moment, especially in February and March.
00:54:19.000We really didn't understand what the consequences of this virus were.
00:54:22.000What do you think they should have done differently?
00:54:59.000But when Trump talks about COVID, he talks about it being this interruption for this world's greatest economy, this thing that he had created during his administration.
00:56:20.000So what we needed to recognize is, okay, we need to reverse all that.
00:56:24.000And yes, now we have an extra reason to do that because now we have COVID-19, but we need to restore sound money, we need to let interest rates go up, we need to let asset prices go down, and we have to...
00:56:43.000Instead, we're just printing even more money.
00:56:45.000We're juicing up the economy with even more debt.
00:56:47.000We're pushing up the Nasdaq to new highs.
00:56:52.000This is making the problem worse, that it dwarfs COVID-19.
00:56:57.000But I agree, because of all the mistakes of the past, because of all the bad monetary and fiscal policy, we were not prepared for this crisis.
00:57:58.000I'm not happy about that, but it's better than the alternative, which is kicking the can down the road again so that we have to suffer even worse, which is that's the deal with the devil that we made.
00:58:09.000So, we should have, you know, made government smaller.
00:58:14.000And, look, maybe we should have dealt with the crisis more like Sweden.
00:58:19.000You know, I mean, a lot of people are giving shit to Sweden.
00:58:21.000But, you know, Sweden didn't want to make that bargain.
00:58:24.000They didn't want to print all this money.
00:59:01.000Sweden became a very rich country because they were a capitalist country.
00:59:06.000And once they became very rich, they experimented with socialism.
00:59:10.000Which was an unfortunate experiment because there's no reason to experiment with socialism because every time it's tried, it's failed.
00:59:16.000But they decided to try it and of course it failed.
00:59:19.000And so they had to start rolling it back once they saw all the damage that the welfare state in Sweden was creating.
00:59:25.000So they started dialing it back and they've gone a long way.
00:59:29.000They haven't eradicated it completely.
00:59:33.000And if you look at the tax proposals by Joe Biden, I mean, we're going to go so far above Sweden as far as the confiscatory levels of taxation.
00:59:44.000I mean, look what Joe Biden wants to do with the income tax, the corporate tax and the personal tax.
00:59:50.000He wants to raise the corporate tax from 21 to 28. But then he wants to raise the dividend tax from 24, where it is now, to about 40-something-ish.
01:01:13.000A connection that people make, they connect socialism to empathy, socialism to kindness, socialism to people that are less greedy, socialism to people that are more interested in a community.
01:01:29.000This is coming from a person like myself who has no economic...
01:01:34.00086% of what I know about the economic world is from you.
01:02:41.000And it's part of the reason why, throughout history, they've left people behind.
01:02:47.000There's certain people that if you had a tribe and you had to make it over this mountain and Bob is fucking lazy and he's like, you gotta carry me, bro.
01:04:04.000From being socialist to being capitalist, because capitalists aren't mean.
01:04:08.000They just understand the unintended consequences of these well-intentioned programs that the left is in favor of, but they don't understand that they actually backfire and make all the problems that they're trying to solve worse.
01:04:21.000But just to backtrack to your fire department, when you have a local fire department, That fire department is there to put out any fire at any house.
01:04:30.000So everybody in the community benefits from having a fire department.
01:05:16.000When he said that quote about the government not supporting the people, there was a bill to appropriate $10,000 for some farmers in Texas who had been hit by a drought.
01:05:27.000And Grover Cleveland vetoed the bill because he said, look, there's nothing in the Constitution that allows the government to I mean, this is not right.
01:05:37.000We can't take money from the taxpayers and just give it to somebody because we feel they're in need.
01:05:44.000But after he vetoed it, the farmers got more than 10 times that amount of money in private donations from individual Americans who wanted to help out.
01:06:11.000Is there an opportunity where these two things can merge?
01:06:14.000Where people can realize, like, hey, we need less taxes and more charitable donations, and it's both possible, and you would probably save money, and we could figure out a way to distribute that money in an equitable way that you have control over.
01:06:28.000So if there's certain charities that you really feel strongly about, like cancer research.
01:06:34.000The people who are likely to give the most to charity are wealthier people because they have more discretionary income.
01:06:41.000And if you have a lot of wealthy people who are paying 40-50% taxes, and I was doing that.
01:06:47.000I was paying about half of my money in taxes before I moved to Puerto Rico.
01:06:54.000I paid about almost half my money in taxes.
01:06:56.000So because half the money went to the government, I had a lot less money that I could be charitable with.
01:07:02.000I mean, I had all the money I needed to take care of myself.
01:07:06.000The money that was taken away from me by government was money that I would have invested to help grow the economy, or maybe I could have used it in direct charitable giving.
01:07:15.000And the other benefit of when you allow more private sector charity...
01:07:22.000Private sector charities are much more efficient because they really care about the people they're trying to help.
01:07:45.000If you go back to the Great Society in the 1960s, if you look at the declining poverty rates in the 1940s, 1950s, 1960s, leading up to the 1960s when we had all the civil rights and all this big war and poverty.
01:09:44.000And you can look at their books and you can say, hey, we're going to take 10 cents to run the charity and actually 90 cents is going to go to the people that we're trying to help.
01:09:51.000With the government, it's the other way around.
01:09:53.000They take in a dollar and only 10 cents actually goes to the people that need the money.
01:09:58.000The rest of it is absorbed in the bureaucracy.
01:10:11.000There's no voluntary interaction there.
01:10:12.000They take your money from you and so they can be as inefficient as possible.
01:10:16.000But then the private charity wants to help people out so they no longer need the charity.
01:10:22.000The government wants to keep people impoverished so they're in constant need of the charity because that way they can get their vote.
01:10:28.000The government knows if they steal money from Peter and pay Paul that they'll always get Paul's vote.
01:10:34.000And that's what they're concerned about.
01:10:35.000They want to keep people entrapped in poverty so that there'll be reliable votes.
01:10:39.000Is that what they want, or do they just want to maintain this system that they have control over?
01:10:44.000Because if they just released everything to the public sector, or the private sector, everything from policing to the water purification, everything they do, instead of the government handling everything,
01:11:03.000they just allowed it to the private sector.
01:11:06.000How would we manage whether or not they were doing the good of the people overall?
01:11:10.000That's what everybody's worried about.
01:11:12.000What everybody's worried about is big business assuming this monopolistic, gigantic monolith that crushes everything before it and pollutes the rivers.
01:11:22.000So the idea of the government stepping in for business is to keep business from only growing and not growing with concern for the consequences of all the other people around it.
01:11:31.000That's where everybody gets real suspicious, right?
01:11:37.000And this is something that always kind of bothers me that people just attribute sinister motives to private businessmen, yet they think politicians are angels and just there to do the Lord's work.
01:11:50.000I mean, there's just as many greedy people who go into politics as who go into business.
01:12:16.000I have to think they're better than the products or services that some other businesses And I have to value those goods and services more than the money I'm voluntarily exchanging to get them.
01:12:27.000So the beauty of the free market is that you have all these businesses who may be greedy competing with one another to best satisfy my desires, my needs, to make me happy.
01:12:39.000And if they don't make me happy, if they can't satisfy my disease, I don't buy their products.
01:12:46.000They have So I don't have to be worried about a greedy businessman who wants to make money because he can only make money by making my life better.
01:12:57.000On the other hand, you take a greedy person and you give them the power of government, they can make my life miserable.
01:13:03.000They don't have to get me to voluntarily do anything.
01:13:05.000They just take my money by brute force and they just do to me whatever they want.
01:13:10.000So where you have to fear greed and power is when it's in government, where it can actually harm you.
01:13:16.000Not in the private sector, where it can help you.
01:13:18.000Now I know someone's going to say, well, what if there's a criminal?
01:13:22.000What if somebody is stealing my money?
01:13:25.000And we need government to protect me from thieves.
01:13:28.000But businessmen that are honestly convincing me without fraud or deception, but are being honest and I'm buying their product, Their greed doesn't help me.
01:13:40.000I think we're in agreement on a lot of this, especially what you said, that we need government to protect people from a business getting out of control and demonizing people.
01:13:49.000But it doesn't mean that capitalism in and of itself is a demonic thing, a bad thing.
01:14:52.000We have so much land, labor, capital, and so we have to figure out how to organize our resources in a way to satisfy as many demands as we can.
01:15:02.000And so businesses compete with each other for those resources.
01:15:07.000And the businesses that combine them in a way that they can generate a profit, that means that they're adding value.
01:15:14.000That means that the goods they're producing are more valuable than the resources they consumed in the process of producing them.
01:15:32.000And those businesses need to fail so those resources can be freed up to be utilized more effectively by some other entrepreneur doing something else.
01:15:41.000So we need companies that can't generate a profit to go bankrupt.
01:15:45.000The profit and loss is the thermometer that tells you if you're doing the right thing.
01:15:51.000If you're making a profit, keep doing it because you're creating value.
01:16:00.000So the market is trying to function so that we can have an optimal amount of economic growth.
01:16:04.000Then you have the government coming in and deciding to subsidize businesses that it doesn't want to fail.
01:16:10.000Because, oh, we might lose some votes.
01:16:12.000You see, there's a concept About the seen and the unseen.
01:16:16.000And politicians are concerned about what you can see.
01:16:19.000Because when the politician bails out a company and they save the jobs of these workers, everybody can see that and they can take credit for the jobs they supposedly save.
01:16:29.000But what you don't see are the jobs that were never created or might have got destroyed because the government misdirected We're good to go.
01:16:54.000Is it possible that there could be a cap on the amount of – like, we all agree that everyone – there needs to be some regulations, right, in terms of environmental impact and a bunch of – I think we're good to go.
01:17:33.000Well, I mean, if you have a company that gets enormous, just absolutely enormous, and they control all the jobs in the region, they could really dictate how much money people get per hour, and they could make it really poor and terrible.
01:17:45.000And you could say that people have the right to just leave or find something else or create a better future.
01:18:36.000There would have been some jobs originally.
01:18:38.000I mean, there's no way that there's just one business in the entire community.
01:18:42.000But if you're born into this and you're 16 years old, you're shit out of luck.
01:18:46.000And that corporation does have control over you.
01:18:49.000If you're born into it, if you're 16 years old, you're in high school and you're getting your first job, and the only job is at Walmart, you're working at Walmart.
01:19:55.000But the reason that I don't think there should be a minimum wage is because I think individuals should be free to accept employment opportunities that they want to accept.
01:20:05.000See, the minimum wage doesn't hurt businesses.
01:20:08.000It hurts individuals that have low skills.
01:20:14.000When you have people defending the minimum wage or opposing minimum wage hikes, they always say, oh, it's going to hurt businesses because it's going to increase their labor costs.
01:20:51.000Before we had all these programs, the black teenage unemployment rate, once upon a time, was actually lower than the white teenage unemployment rate.
01:21:00.000Now it's like double or triple as high.
01:21:02.000But before we had all these laws, it was actually lower because they got disproportionately impacted by the minimum wage law, which prices them out of work.
01:22:39.000There could be a minimum wage and we still hold the same values that you're talking about in terms of competition to keep people from getting fucking shitty with their employees.
01:22:48.000Have you ever seen an employer yell at their employees or be in one of those corporate gathering situations where someone has a lot of control over their employees?
01:22:59.000Now imagine if that guy was making all the money and he was only giving these employees a dollar an hour and making them live in poverty.
01:23:56.000If you make someone work 40 hours a week and they don't have enough money for food or shelter after 40 hours a week, couldn't we say that maybe that is not a good level?
01:24:07.000As a community, so everybody agrees we're all competing, but let's make it so that if someone is under your employment and it's a human being and they're doing 40 hours of work Every week, they should have enough money for food and shelter.
01:24:44.000If you don't have any skills, if the most you're able to earn at your job, and let's say there's no minimum wage, and you're just a young kid and you don't have any skills, and the most you can earn is $4 an hour, that's because, again, you're paid based on your productivity.
01:25:01.000Businesses are there to make a profit for the owner of the business, because that businessman is taking a lot of risk, he's bearing the potential for losing money, he has to provide...
01:25:12.000A businessman is not going to hire somebody if they're not adding value to the business.
01:25:17.000So if somebody can add $5 of value to my business, I'm not going to pay them $7.25 an hour because I'm going to lose $2.25 for every hour that person works.
01:25:27.000So the only way I can hire somebody who is providing $5 worth of value is if I can pay them $4.
01:25:34.000Then I can make $1 for every hour he works.
01:25:37.000The business is not there to lose money.
01:25:41.000If you're a young kid and you can only provide $5 worth of value and so you get a job for $4 and your employer makes a buck an hour off of you, chances are you don't have a family, you're young, you're living with your parents, you don't have rent, you don't have, you know, so making a little bit of money is okay.
01:25:58.000You just need some spending money to go to a movies or maybe go out on a date or something.
01:26:02.000What's important is the work experience.
01:26:05.000Having that job, developing some skills, getting your foot in the door, step on that first ladder, the rung of the job ladder, so that by the time you're 30 and you're ready to settle down and get married and have kids, you've now Increase your skills to the point that you can make $50 an hour where you can afford to support a family.
01:26:27.000If you try to tell a business that you need to pay somebody who has no skills and adds minimal economic value, if you have to pay that person enough so that you can support a family, nobody's going to hire that person.
01:26:41.000All you're doing is pricing those people out of a job.
01:26:43.000So it's really good to say it's not reasonable.
01:26:46.000If somebody is working and only making $10 an hour and they can't support a family, it's not the employer's responsibility.
01:26:55.000It's not his fault that he's hiring somebody that doesn't have a lot of skills.
01:26:58.000And if you impose that minimum wage, all you're doing is making it impossible for this guy to get a job.
01:27:05.000Really, what the minimum wage law is, is it makes it illegal for you to work unless you have a certain amount of productivity.
01:27:11.000So if the minimum wage is $15 an hour, what that means is if you only have $10 an hour work of productivity, you can't work.
01:27:20.000That you have to turn down every offer of employment you get.
01:27:23.000If someone offers you $10, $12, that's illegal.
01:27:26.000You can't accept those jobs, even if you want them.
01:27:29.000Even if you think that that's the beginning, the first step on a road to higher wages in the future, the government says, no, you can't accept that.
01:27:37.000Unless you can find somebody who will pay you $15 an hour, it is illegal for you to have a job.
01:27:46.000Because now you've taken away all the honest ways that somebody can make a living, and they end up turning to crime a lot of times.
01:27:53.000I see what you're saying, and that actually makes a lot more sense the way you're framing it, about if you only provide $10 worth of value to the company, why should they pay you $15?
01:28:23.000Think of all these, look, I get very frustrated all the time when I make phone calls and I can't talk to a human being.
01:28:34.000The reason for this is because we've priced the human beings out of the market.
01:28:37.000You know what else is interesting, Peter?
01:28:40.000What's horrible about this for all of us is when you do do that and you're dealing with these goddamn computers, it's like we're losing part of our connection when it comes to doing business.
01:28:52.000If I do business with a company, I like to be able to call them up.
01:28:56.000I'd love it if there's a thing when I'm doing something.
01:29:00.000I like to make contact with the person.
01:29:02.000If everything is being done through automated systems, it's getting weirder and weirder for us.
01:30:24.000These young kids that got low-paying jobs as pump jockeys, what they would do between fill-ups is they would go and hang out with a mechanic who was there working on cars, and they would get a free education in auto mechanics.
01:30:37.000And they would actually learn a trade.
01:30:39.000And then some of these guys, I mean, we'd have more auto mechanics that get a skill.
01:30:43.000Some of these guys would end up opening up their own service stations.
01:30:47.000Look, it's good to allow young people to have employment opportunities.
01:30:51.000Not to price them out of the market by mandating a minimum wage.
01:30:56.000I mean, the minimum wage benefits high-skilled workers, unions, by eliminating competition with younger, lower-skilled workers.
01:31:03.000You're forcing employers to hire high-skilled people instead of a more numerous number of lower-skilled people.
01:31:31.000But in the beginning of The Hustler, Paul Newman pulls into a gas station and he tells the guy, check the air in the tires, check the oil, do all this.
01:32:22.000Look, they're working on these kiosks now.
01:32:24.000Look, they're going to get rid of all the workers.
01:32:26.000Anyway, ultimately, all these fast food restaurants, there's not going to be anybody there.
01:32:30.000They're all going to look like self-serve gas stations.
01:32:33.000You're going to go in, you're going to order off your smartphone, and the food is going to come down a I worry we're going to lose movie theaters.
01:33:23.000I was amazed because I was like, oh, this is like looking through a window.
01:33:26.000It was like because people don't realize how bad the pictures used to be unless you actually see an old TV, you know, one of these with the tubes compared to what we look at now.
01:33:35.000I mean, you can't even watch one of those things.
01:33:36.000But, you know, we didn't know how bad it was until something better came along.
01:33:40.000But when I first saw that, I was like, oh, my God, this is incredible.
01:33:44.000But I didn't buy it because it was ten thousand dollars.
01:33:47.000And that was a lot of money to me back then when I was in my 20s.
01:33:50.000A $10,000 TV, I could buy a car for that.
01:33:53.000I wasn't going to spend that much money on a TV. Now you get those TVs for $500, $600.
01:37:21.000Government makes things worse and more expensive.
01:37:24.000Every service that the government provides you with, whether it's education or healthcare, it gets more expensive and the quality goes down.
01:37:33.000Everything we get from private sector gets cheaper and the quality goes up.
01:37:38.000That's why we want to limit what government does to the smallest amount of stuff.
01:37:44.000And let the free market do everything else.
01:38:18.000Governments basically take what amounts to bribes from businesses to basically protect them from competition or bail them out.
01:38:26.000We've given the government too much power and you can't blame the private sector for trying to get that power to be used in its advantage because if it doesn't do that, one of its competitors will get it and it'll be used again.
01:38:40.000It's like the government is like the mafia, right?
01:38:42.000And people have to pay I don't know how to set them against somebody else.
01:38:58.000And if you go to letusdisagree.com, you can see this movie.
01:39:03.000But the guy that produced it, Jimmy Morrison, and I remember he came to my office and filmed me.
01:39:09.000He started it back in like 2010 or something.
01:39:13.000Because he wanted to talk to the people that predicted the 2008 financial crisis and get their perspective on what the government did wrong.
01:39:19.000And so this is a whole movie about the history of how government has screwed stuff up.
01:39:24.000Going all the way back to the Great Depression.
01:39:27.000Because there's a lot of misinformation out there about why we had the Depression.
01:39:32.000People say, oh, it's because we had too much capitalism.
01:40:41.000And because of what we just did after COVID-19, And the mood that we're in right now.
01:40:48.000I mean, I am so terrified of what's coming in this country.
01:40:53.000I mean, the popularity of socialism has risen so dramatically because we have discredited capitalism by preaching it and not practicing it.
01:41:03.000All the damage that has been done in the economy in the name of capitalism has given it a black eye.
01:41:08.000You know, there are real problems in this country, and I'm very sympathetic.
01:41:12.000With people on the left who point out some real problems.
01:41:44.000The only reason we have an income tax is because we were going to tax the rich in 1913. That's the only reason.
01:41:51.000And the government told the public, if we have an income tax on Rockefeller and Carnegie and Vanderbilt, and it was only going to be like 2%, tiny, little, little, teeny tax.
01:42:00.000The government said, we'll eliminate tariffs.
01:42:03.000That's why we had an income tax, to get rid of tariffs.
01:42:05.000Because tariffs were paid by the average American.
01:42:08.000I mean, people back in 1913 were smart enough to know that consumers paid tariffs.
01:42:13.000I mean, Donald Trump is trying to pretend that the Chinese pay his tariffs.
01:42:22.000And so what Hoover said, or not Hoover, yep, what Woodrow Wilson said was, hey, Let's tax the rich with an income tax and we can eliminate these tariffs that the average people are paying.
01:42:37.000But now, average Americans are paying income taxes at levels far higher than anything contemplated for Vanderbilt and Rockefeller and Carnegie.
01:42:48.000So look, taxing the rich doesn't work.
01:42:52.000A lot of the wealth that Bernie Sanders, and I know you had him on the show, but a lot of the wealth that his ilk wants to tax is going to be destroyed by the very taxes that they want to impose.
01:43:03.000And they're not going to collect anywhere near the revenue that they think they're going to get.
01:43:08.000Instead, everything is going to cost much more than they think, and they're going to have to pay for it by printing money.
01:43:13.000And they're going to destroy the value of the currency.
01:43:15.000If you're a person who was advising a president or a governor to How to fix an economically disabled community.
01:43:24.000If you have a community that's always had a history of poverty and crime and drug use and gang use in these communities, what would you do?
01:43:36.000How do you use this idea of capitalism to fix something that clearly requires some charity?
01:43:45.000First of all, we can stop making the problem worse.
01:43:53.000Just like the war on poverty, it's backfired.
01:44:18.000But the problem is when you have the war on drugs and you make it a crime, now you incentivize criminal activity.
01:44:28.000Because whenever something is illegal, it's much more expensive than it was And now you create this huge profit opportunity for criminals to come in and fill that demand.
01:45:09.000I mean, most of the robbery is committed by drug addicts because they need the money to buy their expensive heroin.
01:45:15.000Well, if heroin were legal, it would be much cheaper and they wouldn't have to steal.
01:45:19.000Of course, and the best example is prohibition, right?
01:45:22.000I'm not saying that people should do heroin, but they should be free to make a decision, but they shouldn't have to rob other people to support their habit.
01:45:31.000And when you have heroin, when it's illegal and there's all these profits, the drug guy, the pusher has an incentive to get you hooked on it.
01:45:41.000I think maybe you should have to go get a prescription for it where the doctor can try to talk you out of it.
01:45:46.000Hey, are you sure you want to use this stuff?
01:45:54.000Most people probably wouldn't necessarily make that decision if they were confronted with a lot of evidence that shows why it's a very We've got to get rid of the war on drugs, get rid of the crime in that community.
01:47:28.000But in the current state of the world right now, those people don't have any other options.
01:47:34.000They don't have any other options because the government has taken away that option.
01:47:38.000But what do you do for them in real time?
01:47:42.000If you have a guy who's in a lower income family and he has a 7 year old son and that kid is going to school right now, how do you fix that right now?
01:47:52.000If we had private schools, the kid could go there.
01:47:57.000What if they couldn't afford the private schools?
01:47:59.000For people who are really poor, private schools would give out scholarships to kids that have a lot of potential and their parents don't have the money.
01:48:07.000But when the private sector educates kids, it's cheaper.
01:48:41.000Seven is, I don't know, seven might be a little young.
01:48:43.000How old before you pull the plug on that kid?
01:48:46.000The tuition in first or second grade is probably going to be less than in high school.
01:48:52.000Because in order to teach a second grader, the teacher doesn't have to know as much as the teacher needs to know to teach a tenth grader.
01:49:00.000So you wouldn't have to pay a second grade teacher as much as a tenth grade teacher.
01:49:04.000See, the problem in the government is everybody gets paid the same.
01:49:08.000Whether they're a lousy teacher or a good teacher, whether they're teaching a first grader or a high school, it's just all based on seniority.
01:49:16.000It's a crazy crackpot system that only the government could devise, and it's only because they have a captive audience.
01:49:23.000The customers don't have a choice, and the parents aren't even involved.
01:49:28.000If the parents were actually writing a check and paying for the education, they would make sure the kids did the homework.
01:49:34.000They would make sure they were getting their money's work.
01:49:36.000When you get it for free, I mean, you just take We need real education for the kids that can benefit from it.
01:49:43.000We need to get rid of the minimum wage law and all sorts of occupational licensing laws and other things that the government does that prevent people from getting jobs or starting businesses.
01:49:54.000The government is creating all sorts of barriers, artificial barriers, that would not exist absent government.
01:52:29.000Before the government guaranteed banks, before you would put your money in a bank, You would do a little research, just like you do research now before you buy a car.
01:52:40.000You try to figure out which is the best bank for my money, which bank is the safest, which bank isn't having problem loans.
01:52:48.000And you would consult periodicals or reviews online, not online, but you would find out where the banks were good, and you would put your money in that bank.
01:54:03.000Because the government insured their deposits and allowed them to get this big and allowed them to have access to all this cheap money from the Federal Reserve.
01:54:16.000We don't need the government to do that.
01:54:19.000The banks are much more reckless and much more corrupt now because of government than when we had free market forces reining them in.
01:54:26.000Why aren't there more people saying what you're saying?
01:54:58.000Your perspective is very ruthless and honest.
01:55:02.000And some people would say, maybe you're not considering the people that really don't even have an opportunity to get into this system and compete.
01:55:23.000But the reason that you don't see more people like me in positions of power in government is because it's hard for people like me to get a power We're good to go.
01:55:49.000They want to fund candidates that are going to protect the status quo.
01:56:39.000It's about liberty and individual opportunity.
01:56:42.000It's about being left alone from government and being able to achieve all that you can achieve without anybody standing in your way, without anybody erecting a roadblock.
01:58:38.000Wouldn't that make you be proud to know that we're a nation of free people?
01:58:43.000Can I say that your assessment, this is what I'm seeing from you, you think that the The competition and the nature of the free market would have been better off without the intervention of the government, but you understand the government was kind of put in there to regulate things because they thought that people were going to get out of hand and they wanted to make sure that things were fair,
01:59:06.000but then the government grew too big and became a problem with human beings in general.
02:01:17.000Yeah, it would have been better if he did it on day one.
02:01:20.000It would have been a lot more effective if he had told the truth rather than lied for three years and now come on, okay, I've been lying to you, now I'm going to finally level and tell it like it is.
02:01:43.000That Trump, as a candidate, said the real unemployment rate was 30 or 40%, and the government numbers were a lie, a fraud.
02:01:52.000So if he actually said that, and now all of a sudden he's president, and the same exact Labor Department that was coming up with the same 5% unemployment numbers that he said was really 30 or 40, and now he says, oh, the unemployment rate is 4%.
02:02:47.000Let's say somebody had a good job, and they lose that good job.
02:02:51.000And so while they're looking for another good job, they accept a shitty part-time job, right?
02:02:56.000They're still looking for a good job, but they're making ends meet with this crappy part-time job.
02:03:00.000In the past, that guy would still be considered unemployed because he was still looking for a job, even though he took a part-time job to help make ends meet.
02:03:09.000Today, if you take a part-time job, and even if it's one hour a week, and you spend the rest of the week looking for a job, you're not counted as unemployed.
02:03:18.000So when you take the statistics from today And compare it to statistics from the 60s or 70s or 50s, you're comparing apples to oranges because back then all those people were considered unemployed.
02:03:31.000And this is what Trump meant when he was a candidate.
02:03:34.000If you actually measured unemployment today, the way it was measured back then, we'd have an unemployment rate well above 10%.
02:03:53.000The same thing about the stock market.
02:03:55.000How is it that the stock market was a bubble while he was a candidate, and then all of a sudden it wasn't a bubble now that he's president?
02:04:34.000Donald Trump, I think one of the speeches that he gave, he's like, I don't know how this is happening, who's making these loans, but we want some of that money.
02:04:45.000He's like, we should be able to borrow at negative rates.
02:04:47.000Well, that means somebody has to be losing money.
02:04:50.000Well, the only one dumb enough to lose the money is the Federal Reserve.
02:05:06.000As I said earlier, the reason that we were so ill-prepared for COVID-19, the reason that families couldn't get by without a paycheck for We're good to
02:06:14.000If we had a free market in lending, if we didn't have government guarantees and we didn't have artificially low interest rates, no bank would lend you that money.
02:06:22.000And interest rates would be much higher for those type of consumer loans.
02:06:25.000I'm glad they're going to lend it to me because if they lend it to me, I can get a Corvette.
02:06:28.000The government is subsidizing these auto loans.
02:06:40.000How is the government subsidizing auto loans?
02:06:41.000If I want to buy a 2020 Corvette and I make $60,000 a year and they hook me up for some $85,000 loan, how is the government subsidizing that?
02:06:50.000Because the government is buying those loans.
02:06:53.000What happens is your car company doesn't actually keep the loan.
02:06:57.000So it doesn't give a damn whether or not you actually can repay it.
02:07:55.000Well, the reason that this is possible is because the company takes that loan and sells it on the secondary market to get the money.
02:08:05.000It doesn't care if the person who bought the mattress can repay that loan because it's going to sell the loan as soon as it's originated and get the money.
02:08:14.000The loan gets bought and packaged and structured and it's all securitized, but all this is being propped up by artificially low interest rates and government guarantees.
02:08:25.000If we had higher interest rates, Consumer loans would be much more expensive than they are now.
02:08:45.000Because we want savings going to businesses who will invest in plant and equipment to make the country more competitive.
02:08:54.000To provide services, to create goods, to provide jobs.
02:08:58.000We don't want to squander savings on consumption.
02:09:02.000Because when you borrow money to buy capital equipment, The capital equipment makes you more productive, generates more income, and that income helps you liquidate your debt.
02:09:13.000But when a consumer goes out and borrows money to buy something, they don't get an income-producing asset.
02:11:14.000Because right now, one of the big political issues, especially among the left, they want to forgive the student loans and they want to make college free.
02:12:40.000You shouldn't have to have jobs while you're in school.
02:12:43.000You should just be able to go to school and enjoy yourself.
02:12:46.000And we're going to make it possible for you to borrow money to go to school by guaranteeing the loans.
02:12:53.000Because normally, the bank wouldn't lend you any money because you have no credit history, you have no assets, so you're not going to be able to get a loan.
02:12:59.000But we're going to guarantee the loan, and that way you'll be able to get the loan.
02:13:02.000Now somebody else won't get it, some businessman won't get the loan, because we're going to make We're good to go.
02:14:24.000And then everything became bloated and they kept raising their prices.
02:14:28.000And then, in order to get the votes of the students, the government kept raising the limits on how much loans they would guarantee.
02:14:36.000So it became this self-perpetuating cycle where the more money the government guaranteed that the students can borrow, the more the colleges could charge in tuition.
02:14:53.000So the loans themselves became the reason that people needed the loans, because the loans were why college was so expensive.
02:15:00.000And so now you needed a loan to go to college, but without the loan, tuition would have come down.
02:15:05.000You see, if there were no student loans at all, and right now the government has actually taken over, they don't just guarantee student loans, they loan directly to the students.
02:15:13.000If there were no student loans at all, if the government just said no more student loans, all of a sudden the colleges would be, oh my god, We need to cut costs.
02:15:30.000They would streamline their business like everybody else.
02:15:33.000I mean, any business that could charge whatever the hell they wanted because the government could borrow the money If you had a restaurant where the government was going to guarantee to pay the bill of everybody who dined there, I mean, shit, the restaurant could charge whatever it wanted.
02:17:15.000I think I mentioned in the video on your show, the podcast last time where I was down on Bourbon Street in New Orleans and I was interviewing all the people there that were working that had college degrees but were doing menial jobs.
02:17:26.000Bartending, bouncers and strip cubs, pedicab drivers.
02:19:34.000I care about the kids who are getting ripped off, who are getting indoctrinated and not educated, and who are being saddled with a mountain of debt.
02:19:41.000And the government says the solution is free education.
02:19:46.000If you think education is expensive now, wait until you see how much more it costs when it's free.
02:19:51.000Do you think that the current state of colleges, when we think about colleges today, we think about social justice warriors, we think about these kids growing up in this weird future where they're going to graduate online, do you think that The extreme liberal socialist bend that you see in colleges would be different if there was a free market.
02:20:16.000Do you think people would be more realistic in terms of all universities were free market based?
02:20:22.000Do you think people would be more realistic in terms of their expectations for other people in the future?
02:20:35.000And I think one of the driving forces is a lot of these universities, they always want to hire professors, especially when it comes to economics or some of the political science.
02:20:44.000They want to hire people who have worked for government.
02:20:47.000And they want to see some of their professors go to government and then come back.
02:20:52.000And the only economists that will get a government job are the Keynesian economists who want to pretend that government can actually help the economy.
02:21:01.000I mean, there is no role in government for a free market economist who says, leave it alone.
02:21:07.000That guy's not going to get a government job.
02:21:10.000The government wants to hire people that are going to justify more government spending because that's how they buy their votes.
02:21:16.000So you get these big government Keynesian economists who go between government and academia, and they go back and forth, and so it perpetuates this cycle.
02:21:26.000But there are—look, you can find some examples of universities that teach real economics, free market Austrian economics, but they're in the minority.
02:21:39.000I mean, when we think about educating kids— I mean, it's a weird way of looking at it, right?
02:21:48.000The idea that the government paying for everything, making everything more expensive is going to make more people that are dependent upon not competing and being a part of this weird system where you think you're owed things, right?
02:22:53.000A lot of it could be she's just a great politician.
02:22:57.000Yes, but I think that economics are complicated, and I think most 28-year-olds don't really understand it.
02:23:04.000I think it's really complicated, and I think we get idealistic or ideologically based in, like, you're a left-wing, you think this way, you're right-wing, you think that way.
02:23:15.000And we get very rigid in how we look at things, but if you want to look at what you're saying in terms of competition creates the best solution for everybody, because the most effective and viable method is the one that rises to the top, and that's the one that people support with their money if they have total freedom.
02:23:32.000But if you have the government that steps in and dictates that you have to go this way or that way, or it has to cost this much or that much, then the government itself becomes a business.
02:23:41.000The problem is it needs to justify its own existence by creating more and more regulations, more and more problems, more and more impediments to freedom.
02:23:56.000Every time the government writes a regulation or passes a law, we're less free because those regulations and those laws are limiting our freedom because they're restricting our choices.
02:24:05.000Right, but to bring the two of us together, to bring everybody together, don't you think that maybe there's an opportunity where people can recognize, that doesn't mean you're a bad person.
02:24:15.000You're just looking at the actual game.
02:24:17.000And there's a lot of bullshit going on where people are pretending what's happening is different than what it is because they want to feel better about the results.
02:24:27.000I think most of the people on the left are not bad people.
02:25:04.000You know that that's a reductionist argument.
02:25:06.000The rational thought because they don't have those thoughts.
02:25:09.000Right, but you know that's a reductionist argument that doesn't really make any sense, but you'll entertain it even though you know it doesn't make any sense.
02:25:15.000The people that are really paying attention know that doesn't make any sense.
02:25:19.000It's not that you're a heartless person.
02:25:22.000You're explaining what is actually going on in terms of government subsidizing education.
02:25:28.000You're talking about competition in terms of the free market.
02:25:33.000None of what you're saying, just from me to you, is in any way conveying a sense that you're a heartless person.
02:25:39.000But that is the narrative when people don't agree with what you're saying, because they have in their head an ideologically based alternative to what you're saying.
02:25:49.000Yeah, and look, I watched the interview that you did with Jon Stewart, right?
02:25:53.000And Jon said a lot of things that I agree with, like a lot of the problems on Wall Street and the bailouts, all that's true.
02:26:00.000But again, what he didn't understand was that's not capitalism.
02:26:35.000When I'm saying that I would pay more money if I thought it would fix it in taxes, I'm not thinking of the government as its current entity that ruins everything.
02:26:46.000I'm thinking of if I could give more of my income To taxes and it would actually make a solution.
02:28:18.000I completely understand what you're saying.
02:28:20.000When I was saying it, and I don't disagree with you, when I was saying it, I was saying, if I could give more money, and that money, if I didn't have to think about where to put it, if I knew that that money was going to be managed by ethical, knowledgeable wizards who know how to take care of the world's problems and they just get 5% more taxes from people that are doing well,
02:30:22.000But now the government takes everything and now all the towns have to beg to get the money back and now the government has all kinds of strings.
02:30:29.000The federal government says, if you don't do this and you don't do that, we're not going to give you highway funds.
02:30:34.000We're not going to give you student funds.
02:30:36.000So now the government is taking control.
02:30:38.000The federal government is taking control of all the states.
02:30:58.000So, essentially, it's like we need some sort of rules to get along, but you're saying that we should agree upon those rules in the free market and not have some government entity, some group of people that's no different than our own selves...
02:31:31.000Yeah, and here's an important point that I really want to get across in this podcast.
02:31:38.000Because, you know, we are headed, as I said, for a massive economic crisis.
02:31:42.000I mean, what we've seen so far is nothing, right?
02:31:45.000What happened in 2008, what's happened since COVID, this is a dress rehearsal for a much bigger show that's coming.
02:32:05.000It's going to be blamed on capitalism, right?
02:32:08.000The politicians are going to say, you see what happens when you don't have enough government, when you don't have enough regulation, when you have too much greed, right?
02:32:16.000And the public is going to buy this nonsense just the way they bought it about the financial crisis.
02:32:22.000I was warning people for years about the housing bubble and the financial crisis.
02:32:25.000The reason I was able to write a book and lay it out exactly the way it happened.
02:32:29.000The reason I was doing all these lectures around the country warning people about the disaster that the Federal Reserve was creating was because I understood the economics.
02:32:37.000I understood the mistakes that Greenspan was making, and I knew the consequences that were in store for us.
02:32:44.000Well, the mistakes that have been made by Bernanke, by Yellen, by Powell, dwarf the ones that were made by Greenspan.
02:32:53.000It's the same mistakes, just on a much bigger scale.
02:32:55.000The country is in far worse shape now than it ever was at any point in the past, structurally and with all the debt.
02:33:03.000And this crisis is going to be a currency crisis where the dollar crashes.
02:33:08.000We're going to have massive inflation in a weak economy.
02:33:11.000They called it stagflation when it happened in the 1970s.
02:33:14.000The Keynesians didn't know what to do with it because it violated all their rules of economics because they don't understand economics.
02:33:29.000And government is going to try to sell us on another bull of goods that the solutions The only solution is to take away the power that they have.
02:33:39.000But I also want to make sure, and this is what I'm doing personally, I do two things, right?
02:33:44.000I try to educate people so that they understand the economy and so they know who to blame for the problems.
02:33:52.000But I'm also trying to make sure To spare as many people as I can from suffering the financial consequences.
02:34:01.000I said earlier in the podcast that the government is financing these expenditures through inflation.
02:34:12.000We don't feel it that much now because foreigners are subsidizing us with holding our dollars in treasuries and other instruments.
02:34:19.000But when the dollar crashes and prices go through the roof, people are going to get wiped out by this inflation tax.
02:34:25.000A lot of people who are retired are going to see their life savings just evaporate.
02:34:29.000I mean, they'll still have their money, they just won't be able to buy anything with it.
02:34:32.000And what I'm afraid too, is that we're gonna get price controls.
02:34:36.000Because when the government starts to see prices really going up, and the public complains, just like Richard Nixon did, and although inflation was only 4%, When Tricky Dick put on wage and price controls.
02:34:47.000But I mean, it's gonna be way higher than that this time.
02:34:50.000But they're gonna create shortages, they're gonna create black markets, there's gonna be blackouts, food shortages, there'll be riots.
02:35:23.000I want to make sure that you just signed a big check with Spotify.
02:35:27.000You should have had a gold clause in that contract because it's over 10 years.
02:35:32.000Five years from now, you're not going to get anywhere near the money you think you're going to get because that inflation is going to destroy it.
02:35:42.000What would you have done differently and what can we do now?
02:35:46.000What would you have done differently if you and Trump were homies and he said, hey, Peter Schiff, I'm thinking about shutting this thing down.
02:36:31.000We've got to shut down the world, or we're going to kill people.
02:36:34.000What do we do differently than what we did?
02:36:38.000Well, again, first of all, I think we would have handled our response to the disease better if we actually realized the cost of what we were doing.
02:36:47.000I think that we've acted so cavalierly because we believe we're getting all this government for free.
02:36:53.000We believe it's okay for people to stay at home and watch Netflix and receive government checks.
02:36:58.000We don't understand the greater damage.
02:37:01.000See, what we're doing now, this monetary policy, this fiscal policy, is going to impose far more harm on average Americans than the coronavirus ever could have.
02:37:11.000So we have to get that, that our cure is so much worse than the disease ever could have been.
02:37:31.000Let me take this from this alternative perspective.
02:37:35.000The problem with what you're saying is that people, if the government didn't step in and ensure that some money went out so people could provide basic needs and necessities, people were going to die.
02:37:47.000Because they were going to have to go to work.
02:37:57.000Let local communities take care of it.
02:38:00.000Did you not think we were going to die in March?
02:38:03.000Did you not think we were going to die?
02:38:04.000Do you not think a certain percentage of people you knew were going to die?
02:38:09.000Well, there's always a certain percentage of people who get the flu who died.
02:38:13.000Obviously, I knew from the beginning that the people who were dying were the people who were 80 years old or higher who were dying from all sorts of things.
02:38:40.000What I'm saying is when it happened, what I'm saying is when the pandemic occurred, we were all scared.
02:38:47.000So if you're sitting here saying they should have done this, in a way at least, it's an unfair version of Monday night quarterbacking or Monday morning quarterbacking because we didn't really know what this disease was.
02:41:33.000As a community of people, shouldn't there be a way, at least the government does its best at organizing people to donate money that could go and help people that are in this situation?
02:42:11.000There's a lot of weird shit going on right now that's through no fault of their own because businesses are shut down.
02:42:17.000This is why I disagree that it's the same sort of situation that happened in 2008. For sure, what you're saying makes sense in terms of economics, about the foundation of our economic country.
02:42:29.000The way the economy was was fucked up already.
02:44:11.000Yeah, I do think that all that government telling people what businesses can and cannot open.
02:44:17.000Look, I disagree with a lot of these policies.
02:44:19.000And again, I believe that governments would have acted more responsibly if they didn't think they could put the cost on the Federal Reserve, which is what everybody is doing.
02:45:00.000Well, because I was just, you know, the unions are, you know, they're out there saying, but it's not just school teachers, right?
02:45:05.000There's a lot of people who want to say, I don't want to work because I don't want to get COVID. And so, you know, but meanwhile, people take a lot of risk.
02:45:12.000I mean, maybe someone who doesn't want to go get COVID, they go out mountain biking, you know, or they go skydiving or who knows what, or they smoke cigarettes.
02:45:20.000You know, they do all sorts of things that risk their health.
02:45:23.000But now all of a sudden, no, no, no, I'm not going to, I don't even want to go if I have to wear a mask.
02:46:00.000And I think it's interesting because I don't think it's either or.
02:46:04.000I think there's definitely a lot of people that are going to just never go back to work again if they get that money, if they get free money from the government.
02:47:37.000A lot of what happened with farm subsidies, they recognized that we could get into a situation where we don't have enough food, especially if farmers go under.
02:47:51.000I'm not an expert on this by any stretch of the imagination, but I read a piece on it once, and the way they were describing it was like people like to look at subsidizing farms as being this frivolous thing or thing that doesn't really benefit the people, but the idea came about because they were worried about one day having a food shortage,
02:48:09.000and this happened post-World War II. Are you aware of the origins there?
02:48:14.000That's the nonsense that the government wants you to believe.
02:49:27.000The government is never honest about what it's doing.
02:49:29.000But don't you think post-World War II... The farmers want higher prices.
02:49:33.000I understand, but don't you think that post-World War II they were seriously concerned about having food supplies so they could feed soldiers and feed people in this country if the shit hit the fan?
02:49:42.000You think it was really all about economics?
02:50:12.000So what you do is you enlist government to help you.
02:50:15.000And government helps you get higher prices than you can get in a free market.
02:50:18.000So private companies have an incentive to get the support of politicians so they can make more money.
02:50:26.000We need to take away the power of the government to grant those special privileges to any business.
02:50:33.000There should be no subsidies for businesses.
02:50:35.000Corporate welfare does as much damage, maybe more, than welfare for individuals.
02:50:41.000All of this has to go, and we need a vibrant free market economy.
02:50:45.000And hopefully, when this whole thing collapses, and it's going to collapse, and we have hyperinflation or very high inflation, and we wipe out the savings of the vast majority And we go through a really, really hard, deep economic time period.
02:51:01.000If we could do a reboot, if we can resist the temptation to fully We can go all in on the ideology that destroyed us.
02:51:10.000If we can go back to free market capitalism, we have a bright future.
02:51:15.000With the tools that we have today, if we can have 19th century capitalism with 21st century technology, it's amazing what we can achieve.
02:51:23.000I watched your interview with Andrew Yang, who's afraid of technology destroying jobs.
02:52:30.000with the way our country is going is there's a lot of people that are just they're leaning towards what they feel is the right way to go where all their peers agree is the right way to go and it's going to lead to a better future but a lot of the people making these decisions don't have a lot of life experience so you got a tremendous amount of momentum for 18,
02:52:50.00019, 20 year old people and when they hear something like free market Free market capitalism is going to fix the world.
02:52:59.000One of the things that bothers them the most is that they associate free market capitalism with greed.
02:53:23.000And capitalism is getting blamed for a lot of the problems that socialism is creating.
02:53:30.000But when people are saying, again, somebody is greedy, we're all greedy in the sense that we all want the best for ourselves and our families.
02:53:40.000We all want to go out and make money so that we can have a We're good to go.
02:54:24.000Peter, I agree with everything you're saying.
02:54:31.000I agree with everything you're saying, but what I'm saying is that in the general public's view, when you say free market capitalism, they equate mean.
02:54:39.000When you say socialism, they equate kind.
02:56:28.000So this is what happens with socialism.
02:56:30.000Bro, you've got to lie about Santa Claus.
02:56:32.000When you're a young guy or a young woman, and you don't have any real-life experience, you haven't worked, you haven't had a business, you haven't been out in the real world, you live with your parents, you go to school...
02:56:44.000I mean, in theory, it sounds great, but you don't have any real life experience.
02:56:47.000By the time you're older and you've been in the real world and you've paid taxes and you've seen the consequences, you start to understand more.
02:56:55.000And then you give up your childish beliefs.
02:56:58.000The problem with a lot of these older socialists like Sanders, it's like a kid that never grows up.
02:57:03.000It's like somebody who's 70 and still believes in Santa Claus.
02:57:31.000Listen, Peter, we just banged through three hours, if you can believe it or not.
02:57:36.000No, we can keep going for another three because there's so much stuff that we could actually talk about.
02:57:41.000No, I think, but I just want to say this before we wrap up.
02:57:43.000I think you provide some very honest and brave insight.
02:57:48.000You buck the trend of sugarcoating things and the way you describe your version of free market capitalism is very honest and it doesn't seem mean.
02:57:57.000I think this is what's important about it.
02:57:59.000There's a lot of people that think that They have this thought in their head, that's what I was trying to get across, that if you say capitalism, if you say someone who's ambitious, you equate that and success to mean.
02:58:11.000And this is a part of the problem with the marketing strategy that's been employed by capitalism.
02:58:17.000It's not a real strategy, but versus socialism.
02:58:45.000When I'm saying your version, I mean the way you describe it.
02:58:48.000People who are mean, actual mean people, don't succeed in business.
02:58:54.000They piss off their customers, they piss off their workers, they lose their customers, their employees quit, and they get better jobs from people who treat them fairly.
02:59:02.000Customers go where they get a good deal.
02:59:04.000And so I want to put my faith in individuals and the free market, not a bunch of bureaucrats.
02:59:29.000But look, I want to point out, I talk about this.
02:59:31.000I got my own podcast, not nearly as popular as yours, but I would certainly welcome the people that listen to Rogan to go and listen to the Peter Schiff show.
03:01:52.000I appreciate your honesty and your perspective, and it's always a good time talking to you.
03:01:57.000And I appreciate you sharing your information with us, because from a real experience perspective of someone who really understands what you're talking about, I really appreciate it.
03:02:06.000One thing I want to mention about that Occupy Wall Street.
03:02:08.000I did that Occupy Wall Street, and I got two and a half million views on it now on my channel.
03:02:12.000And it had millions and millions of views before I posted it.
03:02:15.000I posted it a couple years ago, right before I went on your show, just so I can point people to it.
03:02:19.000But even though I did that, like in 2009...
03:02:23.000Every single day, I don't think I miss a day, I get an email from somebody, some young person from somewhere in the world, all over the world, to say that that video, that two-hour video of me addressing the occupiers, that that is what changed them and put them And they went from being total government socialist to being complete free market capitalist because they
03:03:09.000Who look at that interaction and share it with your friends and people who look at me, listen to my podcast or look at my tweets and share them.
03:03:17.000And we got to spread the truth because there's so many people spreading lies.
03:03:21.000There's only me and a few other people spreading the truth.