00:31:20.220People think about what is wealth and they go, oh, it's land and houses and all this sort of stuff.
00:31:24.920Land and houses-ish, but actually most land and houses and stuff is as a result of having a big family business or having a big business that's powering.
00:31:32.480So most wealth is equity in a business.
00:31:36.920And also we think about houses and buildings and land.
00:31:40.460But those houses, buildings, and lands are held by companies and trusts.
00:31:44.660So, for example, let's say I've got a couple of houses and I put those in a company.
00:31:50.160If I go and move to Dubai, I can essentially make that company full of debt and any surplus income I can pay it out as a director's fee.
00:31:58.160And living in Dubai, I don't have to pay income on that if I'm physically out of the country.
00:32:03.000So, yes, it would be very easy to say, oh, let's just tax the rich.
00:32:07.600The rich and entrepreneurs have a mindset of wanting to succeed, wanting to be proactive.
00:32:14.880I'll tell you what really makes the rich move.
00:32:17.420I'll tell you what really makes entrepreneurs move.
00:32:19.240It's the mindset of tax the rich more than anything else because there is a mindset that in order to succeed, you have high agency, you get stuff done, you solve problems, and you get rewarded for that.
00:32:32.320And then there's a mindset that in order to succeed, you play the victim, you play your weaknesses, you downplay your strengths, you hide, and ultimately you're the enemy if you're doing well.
00:32:45.820So that mindset of this is an anti-wealth country, this is an anti-entrepreneurship country, I'm seeing a lot of people even just moving to other parts of the world that have similar taxes, but they're just not anti-rich, and they're just not anti-wealth.
00:32:59.560Well, quite a lot of states in America where you might want to live in, New York, California, I mean, they all have a bad rep for various reasons, but people shouldn't get confused.
00:33:09.620There might be a lot of crime in New York and LA, but there's a lot of really nice places you could live in both of those states, right?
00:33:15.200And they have higher taxes than we do in Britain, but they do not have that culture.
00:33:19.220They don't have the culture of scratch the Ferrari versus celebrate the Ferrari.
00:33:22.440If they see – it's actually hilarious.
00:33:46.700So there is that mindset in most of America.
00:33:50.540There's obviously pockets that aren't.
00:33:52.420But, yeah, so plenty of people, when a country turns to the only way to succeed here is to essentially get money out of government.
00:34:02.140See, the thing about big government is this is the other thing that's really important.
00:34:06.200A lot of people would say, oh, it's really greedy not to want to pay taxes.
00:34:09.180But a lot of wealthy people understand that big governments are just a feeding pool for companies, large companies, that figure out how to get money out of government.
00:34:17.520So it's no coincidence that our prison system is run by private equity and a lot of our social care system is private equity backed and a lot of our health care system is now private equity backed.
00:34:28.780And once you work in the world of money and wealth and business, you start to see, oh, these people work in government and then they go and get a 600 grand a year job working for a PE firm and they figure out how to go and take all the money out of government and then they go and make all the profit over here.
00:34:49.220And what big governments create is cronyism.
00:34:52.460They are essentially a monopoly on money and anyone who's making any gets sucked into the government and redistributed to the PE firms who know how to hire ex-government employees and siphon the money off.
00:35:05.260So it's not necessarily – it could be greedy to say I don't want to pay taxes or it could be incredibly patriotic.
00:35:11.040You could say this is not good for the country.
00:35:30.380Big government – like it's almost like clockwork that you can actually see big governments getting bigger and bigger and bigger, poverty is rising, rising, rising, and then eventually the damn breaks and they eventually cut right back and guess what?
00:35:53.100People go, yeah, but what about Norway?
00:35:55.280Yeah, well, Norway, it has this amazing thing called a sovereign wealth fund.
00:35:58.520And I actually think it wouldn't be a bad idea to have a sovereign wealth fund in the UK.
00:36:02.000So the sovereign wealth fund is where you say, okay, we've got some family silver called oil and gas.
00:36:07.940And actually, that belongs to the people of our country.
00:36:12.260So what we're going to do is we're going to ring fence that oil and gas resource.
00:36:15.720And we're going to have other companies that we might charge a little – or sorry, we might allow them to earn a little bit of money through the processing and extraction.
00:36:24.460But ultimately, the wealth stays with the country.
00:36:27.140So this is where you essentially build a sovereign wealth fund.
00:36:30.640So the majority of why Norway works is that sovereign wealth fund.
00:36:35.380Like it literally creates such – I mean, it's something like – I mean, that sovereign wealth fund owns half of London, by the way.
00:36:42.120I don't know if you know this, but Norway and Qatar own more than the royal families combined.
00:36:45.720So two sovereign wealth funds, the Qatari sovereign wealth fund and the Norwegian sovereign wealth fund.
00:36:52.080We actually have $100 billion worth of natural gas under Lancashire.
00:36:55.580We could create a $100 billion sovereign wealth fund out of that.
00:36:58.520We also have the different parts of the North Sea.
00:37:02.060We could create a sovereign wealth fund.
00:37:04.080We do actually have all sorts of natural resources that the UK could access under the structure of a sovereign wealth fund.
00:37:27.940Well, that would be net zero, I'm guessing, right?
00:37:30.060Well, a big reason why we don't do it is because apparently it's a lot greener to produce steel in China and then ship it to the UK.
00:37:38.620He's being sarcastic for our American listeners.
00:37:40.660Yeah, and it's also a lot greener if you get your natural gas from another place and you bring it here on a boat as opposed to just bringing it out of your own ground.
00:38:19.020We don't protect as much of the environment as possible.
00:38:21.000I just think it's absolutely insane that we somehow think that it's better and more virtuous to do this stuff offshore and that that somehow impacts global temperatures for the better, right?
00:38:43.660First of all, what do you mean by economic freedom and actually what are the benefits of it?
00:38:48.660So economic freedom, essentially, as a big picture, you've got state top-down control where a controlled economy is that the government is making most decisions and really dictating how money gets spent in the economy.
00:39:01.260And then you've got economic freedom, which is individuals make decisions about their own lives and they get on with making their own life.
00:39:07.140If they want to buy a car, they buy a car.
00:39:08.640If they want to start a business, they can start a business.
00:39:12.200Now, there are certain things the state should do to protect economic freedom, like rule of law, policing, fast core access to justice, right?
00:39:20.000All of those types of things are associated with economic freedom and they're state-run things, right?
00:39:24.060So there's definitely a huge role for the state to protect economic freedom.
00:39:28.600But then there's this crossing the line and you say, oh, wait a second, we're going to get out of the business of like creating a good playing field.
00:39:35.100We're going to get in the business of actually telling people how to live their lives and how to spend their money and all that sort of stuff.
00:39:41.820So as you get bigger and bigger governments and more and more state control, you erode economic freedom.
00:39:47.600And then essentially you go from like 1% to 4% poverty rates to 25% poverty rates, right?
00:39:54.240And it's almost as predictable as clockwork, right?
00:40:26.240It was just one of the best places you could possibly be.
00:40:28.720And the entrepreneur hub of the world was London.
00:40:31.360And then in the global financial crisis, we implemented all sorts of rules and regulations and higher taxes and all of these kind of things.
00:40:39.880And we brought economic freedom index, I think, from like early 80s down to 70s, right?
00:40:46.500So as our economic freedom has been eroded in the last 20 years, we've just seen rising poverty, lower affluence, wider inequality.
00:40:57.620So I just blame government for that stuff.
00:40:59.640I just see it like it seems counterintuitive.
00:41:03.680But the more money you give to government, the more inequality and more poverty and all this sort of stuff.
00:41:10.180Big governments, you know, anyone who has come from Eastern European countries, Soviet Union, you know that state-run big government just doesn't work.
00:41:20.620You know, people are lining up for bread.
00:41:22.820And then in free markets, there's just so much abundance.
00:41:27.040You know, you see these images of people who come from socialist countries and then they go into a Costco.
00:41:35.120They just can't believe their eyes, like how much abundance there is, right?
00:43:09.400Take control of your financial future today.
00:43:11.780I guess there'll be people listening going, right, okay, Daniel, with certain instances, I agree with you.
00:43:30.800But let's look at, for instance, the healthcare system.
00:43:33.560The NHS has got a lot of flaws, a lot of problems, but I'd rather live in the UK where there is an NHS as opposed to America where I'm just going to pluck a figure at random.
00:43:43.320It costs 30 grand if you break your leg, for example.
00:44:03.660You can see that that investment is going to go in a good direction.
00:44:07.420I can also see that, you know, if someone is injured or, you know, it's in everyone's interest to make sure that they heal and that they're back, you know, and all of that sort of stuff.
00:44:19.300So I think there's definitely things the government should have a monopoly on and, you know, like emergency care and ambulances and all of that sort of stuff.
00:44:30.520Like, the American system where calling an ambulance could wind you up bankrupt seems pretty heartless and seems like, just seems unnecessarily harmful.
00:44:39.720You know, it makes sense to have ambulances.
00:44:42.180One of the issues that we have is that in order to have these systems work, you almost have to have a culture within the country that I will only draw on the system as a means of last resort, right?
00:45:41.540What other benefits are you offering, right?
00:45:44.240You know, hey, actually, why would I work when I could hang out and just get paid the same anyway?
00:45:49.900You know, we have this enormous number of people in the UK.
00:45:53.080I think it's like 25% of people under 35 are on benefits.
00:45:56.680It's 51% of households are on more benefits than they collect – than they earn.
00:46:03.140So we now have this situation where one way to win in this economy is to play the victim.
00:46:10.680You know, we have – there's this video that I saw – it's a video I saw on YouTube.
00:46:16.140And basically this crow had crashed into the glass and the owner of the house had given some milk and bread to the crow, right?
00:46:25.020And this crow had been given free food.
00:46:28.860And then these three other crows flew to the glass, lay on their backs, and looked like they'd crashed into the glass because they'd witnessed that you get free milk and bread if you play the victim.
00:46:42.540And I know it's – look, I'm not at all criticizing someone who has genuine reasons that they need state support.
00:46:47.600But we have actually gotten to the point where a lot of people have figured out, oh, easiest way to get a BMW, I'm going to play this little system over here.
00:46:56.120There are websites dedicated to telling you what to say in order to get certain benefits.
00:47:03.540And we can see this in the charts of how much benefits get paid for certain things.
00:47:06.680You can see that these schemes come in at like a billion, two billion a year, and then they're eight billion, then they're 12 billion.
00:47:12.340I think one in five new cars in the country is now part of the mobility scheme.
00:47:18.380You know, like I'm not saying some people don't need state support.
00:47:22.080In fact, you want to protect it because you want the people who need it to have as much as possible.
00:47:27.260You don't want to have a situation where it's being abused by people who don't really need it because then people who genuinely need it, you know, they don't have as much to access.
00:47:35.340Or there's not enough to do with for other things that we need to do in the country as well.
00:47:41.100Well, we have the Fraser Nelson on to talk about this, to talk about the issues with the benefit system.
00:47:46.640And one of the things, you know, you mentioned that people need to have a really good reason.
00:47:50.420But I think it's also a self-fulfilling thing as well, because let's say you've got three friends and one of them is a bit anxious and another one is a bit depressed.
00:48:01.120And you are, you know, you might not have the job of your life, your life circumstances might not be great.
00:48:05.900Well, I've been there and I don't remember like being joyous in that moment, right?
00:48:09.860Now, if your mates who are slightly anxious and slightly depressed are on benefits because they're depressed and anxious, well, you go, well, I'm a bit depressed, I'm a bit anxious.
00:48:36.660But I was feeling like, oh, you know, I'm entitled to it.
00:48:44.240I really wrestled with it because I have this personally at that age, I had this belief of if I can't afford to be at university, I'll quit.
00:48:51.280I did quit and I couldn't afford to be there.
00:48:53.060I was working four jobs and living on a concrete floor, on a mattress, on a concrete floor, in a shed, in a garage.
00:49:02.380So, you know, but I just didn't want to take state benefits.
00:49:05.560I didn't feel like I was entitled to it.
00:49:07.140But I certainly thought about it because all my friends were getting it.
00:49:33.840And if you talk about entrepreneurship, I do think entrepreneurs, I'm guessing, are quite different to most people in the way their brain works, the way they look at the world.
00:50:53.040Building big teams of people who are out working all the time.
00:50:55.440So some of these guys, you know, they really naturally gravitate towards entrepreneurship.
00:51:00.200But what's interesting is that I watch the power of the environment that you can get some people who are very negative about their situation.
00:51:09.160And as soon as we just introduce the idea of what business do you want to start when you get out of prison and what, you know, and one of them will come up with an idea.
00:51:31.780And then suddenly, like popcorn, it all just starts popping off and the energy in the room just lifts.
00:51:37.920And you see it go from like a weird, like we always start out in a bit of a circle and everyone's a bit quiet and not sharing their ideas.
00:51:44.060And then suddenly it's like this vibrancy pops in.
00:51:47.380And so I do really have hope that for a lot, especially young people, show them that you actually can be successful and you and there's that just suddenly there's this like liftoff moment with energetically.
00:52:00.360It's important to say it's the greatest time in history to be an entrepreneur.
00:52:38.720The only thing is, is that entrepreneurs want to be in a country that's positive.
00:52:42.940You know, it's – I love that you say that because you hear this kind of doom and gloom narrative about country, about late-stage capitalism, et cetera, et cetera.
00:52:55.240And look, conditions are never going to be optimal.
00:52:57.780But that doesn't mean that you should not chase your dream.
00:53:00.680And it's always going to be tough for whatever reason.
00:53:03.160If the economy is booming, there's loads of competition.
00:53:06.200If the economy is not doing great, it's going to be harder to raise capital.
00:55:45.600I'm going to sit there and go, oh, okay.
00:55:48.080Well, under that circumstance, I'll just wait to get toys at Christmas.
00:55:50.900I'll just wait for mommy and daddy to give me the things, right?
00:55:54.340So if you take away the rewards, the entrepreneurship just doesn't happen.
00:55:59.660It's such an obvious thing because the government, it's a weird thing with tax because people instinctively know that the government is always trying to put a sugar tax, an excise duty on petrol.
00:56:13.280It's constantly trying to disincentivize things by making them more expensive.
00:58:46.180But it was basically the idea that democracy can never last forever because once people work out that they can vote to be paid more money by someone else, it just – you don't come back from that.
00:58:58.600It's sort of starting to feel like that to me.
00:59:01.200Unfortunately, we're now – I think 52% of households receive more in government benefits than they pay in taxes.
00:59:09.940Now, what happens when you cross that threshold is that democracy starts to be this compounding –
00:59:15.060But it's also about culture, like you said before, because, look, I've spent – I probably – no, I don't think I've ever been in a position where I've taken more out of the system than I've paid in.
00:59:27.240But I've been not very wealthy for all my life, basically, until we started.
00:59:32.380Well, just quickly on that, you probably – in those times, the government was probably spending 18 grand per person.
01:00:06.040But partly also it doesn't – like what I mean about culture is if there's a culture of like,
01:00:12.840shared responsibility, like what we've got to do is like really make the right decision for the country as opposed to for me.
01:00:20.540And I think we've transitioned very much into that mentality, which is what's the right system for me only?
01:00:27.780But I am in favor of paying – like I'm – this might be controversial with people, especially people who do well.
01:00:35.440I am happy with the tax burden as it is in Britain now.
01:00:38.940And I – we're doing reasonably well.
01:00:40.880I'm happy to pay 40% tax if I felt that it was well spent, which it bloody isn't.
01:00:48.020And also if I didn't feel like it was just putting taxes further and further up was a way of solving the problems that we're actually should be talking about,
01:00:57.920which is lack of productivity, which is net zero, which is we're not generating enough of our own revenue,
01:01:02.900which, you know, mass low-skilled immigration that's not productive, all of these other things.
01:01:07.280And my worry is that the culture is now such that people are so incentivized to only really think about what's good for them.
01:01:24.180I don't think that works for a country like Britain.
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01:12:01.040Building the business, making sure that everyone gets paid other than myself, taking risks.
01:12:05.540And I've had many, many, many months where if we didn't make those last few sales on Thursday afternoon before payroll, we were in serious trouble.
01:12:46.880Sounds totally reasonable because you don't understand.
01:12:48.940And I guess what I'm saying is when you disempower people from going out, starting their own business, pursuing their own dreams, what happens is they get disconnected from the way that money is made, money is created.
01:13:02.120So these ideas, which I now understand are bad and will make people poorer, sound better.
01:13:08.040They sound good, but then they don't work.
01:13:09.680They shut off the engine room of the economy.
01:13:11.920You raise an important point that education is really important, that if you don't educate people about how the system works, then they fall for smart-sounding things or sensible-sounding things.
01:13:23.860You know, Gary's economics comes along and says, oh, just do a 2% income tax.
01:13:29.260You know, I spoke to Gary's economics.
01:13:31.280I was shocked that he doesn't distinguish at all between revenue, profit, wealth.
01:13:37.360He doesn't distinguish between houses and business equity.
01:13:40.400He just got a very simple-sounding soundbite.
01:13:44.840I'm actually shocked that he's LSE and Oxford educated, and he literally just goes with these super soundbites, and then when challenged on it, gets angry.
01:13:53.800But what happens is that you get vast numbers of the population who basically fall for this stuff.
01:14:47.980That you haven't got to where ideally you would have liked to get.
01:14:50.560See, even in Britain where everyone thinks being rich and wealthy is a terrible thing and you're disgusting if you want to do well and all the rest of it, people still want to make money.
01:15:03.580I really want to make sure your listeners know this is the moment in time where you can go from zero to a million in like – it happens fast now.
01:15:13.160We regularly get our clients launch and get a million of revenue in their first 12 months.
01:15:21.280It's often the case because we have access to global markets, lightning fast technology.
01:15:26.780It's often the case that if you want to turn it around, let's say you're in your 50s and you go, oh, I've discovered I've got all this agency and I've done nothing with it.
01:15:48.400This is not a – like it used to be that you had to spend your entire life building something of value.
01:15:52.820Things can become – especially in an AI-powered world, which is going to further polarize people, there are people who can start with nothing and make seven-figure revenue in their first 12 to 18 months.
01:16:07.000And think about how much information is available, including your work and loads of other people in a way that – like even Francis and I never really had access to.
01:16:14.840If you're interested in doing something now, the world of information is all there.
01:16:21.420Well, ChatGPT is literally an advisor that knows everything and you can just talk to ChatGPT and say, oh, how do I set up this?
01:16:43.080Yeah, I was going to say, you know, I always remember this moment during the pandemic when everything locked down and had a kind of bleak moment.
01:16:50.420And I spoke to Andrew about this, the comedian Andrew Schultz.
01:16:53.420And I saw a video of his where he just did a little direct address to the camera.
01:16:56.620And he's – and this actually changed my life where he went, you've always complained that you've never had time.
01:17:05.380You've never had time to write the book, write the movie script, start a podcast, start a business, do follow your dreams.
01:17:14.260And not to say, look, people have kids and whatever else.
01:17:17.320No, it's not everybody has the same opportunity.
01:17:20.280But that reframe of a situation was so powerful for me.
01:17:25.580And I think – and I really want people to take this away from this conversation is you've got more power than you would admit to yourself.
01:17:34.800Our ancestors, your grandparents, great-grandparents, they would trade places with you in a heartbeat.
01:17:41.860I mean, if they could see what's available, if they were sitting on the sidelines and saying, oh, my goodness, you mean you've got – you can start a YouTube channel and no one – you don't even ask any permission, you just start it?
01:17:53.620Oh, you mean you can just set up a Shopify store?
01:17:56.060You mean you can just go connect with people on Instagram?
01:17:58.420You can just use ChatGPT and, like, get every answer to every question and, like, literally customized, tailored to your circumstance?
01:18:19.420We have inspired a lot of people to start things similar to what we do because they're just like, well, if those two idiots can do it, we definitely can.
01:18:53.080You know, it's not fair that my friend, quadruple amputee, just totally unfair, another friend of mine, he was riding his bike as sun was going down.
01:19:35.340Daniel, before we head over to Substack and we ask your people's questions to you, what's the one thing we're not talking about that we should be?
01:20:28.440As someone, there were times when I was teaching, I'm like, I have no idea where we're teaching kids about how to use a compass, for example.