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Foreign Things that you know was talking about they get right that opportunity cost needs to be considered and you should do cost benefit studies and things like that but what they get wrong is the longer term history of the world most particularly important role of Liberty in innovation
I mean if if a person in business is forbidden to introduce Uber in as is the case in Germany and France they’ve made it illegal them it’s not the economy is not in that respect good progress if you stick with regulated taxes so um so that there’s not not enough of that
Kind of um thinking of how important ideas are because economists tend to be both on the left and the right tend to be materialists let’s see it’s certainly a strong man I have friends on the left and they have a friend who just wrote a book on
Neoliberalism and it’s kind of a swear word on the left of these terrible people Margaret Thatcher and so forth and what they’re not seeing is that the core of liberalism is just allowing adults to be free that doesn’t mean they can do anything they want
My I can shake my hand around but if I hit you in the nose or I can I can I the state or someone should stop me from blowing covid-19 up your nose and so forth so it’s a and then sort of on the other side my friends on the left
Think that there’s kind of a free lunch to be had that if we just give subsidies to everyone everyone will be better off it’s the Arjun it’s the Argentinian model and it’s kind of you know I was once a Marxist I I understand the attraction of free lunches hey who wouldn’t
But they’re not and and in a way liberalism is Adultism let’s all be adults and recognize that if we’re going to have government expenditures someone’s got to be taxed and it can’t just be that person it ends up being this person so let’s watch it
Well it’s so far as the think tanks is concerned I am now the Isaiah I hold the Isaiah Berlin share and liberal thought at the Cato Institute in Washington so I’m showing but by my very behavior that I’m in favor of liberal think tanks but I’m in favor of socialist think
Tanks too I’m in favor of thought if people are are serious they should have their own little Think Tank and think but it is terribly important that this voice behind because we tend to have the conservatives on the one hand and the Socialists on the other
And the thing is that the Liberals are neither they’re not on this spectrum from left to right they’re kind of floating above up here because what what the spectrum is about is how to use the massive powers of the state should they be used in a conservative way or in a left-wing way
And we we liberals don’t like power power tends to corrupt so getting that message across and you know what what what what what strikes me over and over again is it my friends on the left and a lot on the right are startled are surprised when I make a very old-fashioned liberal
Argument for something I don’t know let’s take let’s take Public Schools I say I should be taxed Deirdre should be taxed to pay for public schools but that doesn’t necessarily mean that the state should be run like the post office as a state Enterprise I we should be paying for the for
Elementary education but and then people say oh my god oh that’s terrible they haven’t ever thought of it and that’s the role of goods think tanks do you relate that with the work of Eleanor Ostro yeah I do I’m a big fan of hers when she got the Nobel Prize
I said I said oh who’s commission is she another game theorist and I said no wait a second that’s Eleanor Oscar she says as a woman would that maybe we can talk this out that’s her essential Insight that maybe we don’t have always a prisoner’s dilemma
Maybe we don’t always have a kind of football game guy hating each other maybe we can talk about it and solve social problems that way ground up I don’t think formal education has much to do with it there is actually a good good deal of evidence on this point um English specifically English not Scottish but English Elementary education in the early 19th century was quite bad by comparison said pressure or the United States yet England grew very fast look
What you need for economic growth is the husband being allowed to go to work in a factory the wife being allowed to sell fruit in the market entrepreneurial ideas of people to be implemented networking uh social cooperation trust among small groups that’s what makes for economic growth
Hired here here’s one point that’s often forgotten higher education is usually conservative um in in Europe for uh for for many many centuries universities were devoted to the conventional truth in theology law and Medicine neither of which Advance very much because until the coming of the University of Berlin in 1810 teaching
And research were not connected so it’s not obvious to me that more education makes for a richer economy now in another sense it does and this is often kind of strangely forgotten to become an educated person it’s a glorious thing and makes for a better life to know about poetry and Mathematics and
I don’t know astronomy makes you a fuller person to learn about philosophy and so forth so that it’s not just occupational and economic that I’m talking about but but the economy is much more about letting people get rich and then they send their children to school well you know because there are various
Status theories that people have that have been very popular in France and its offshoots in a lot of ways Iberia and Italy for that matter are very much influenced by Paris but I don’t think that there’s any entrepreneurial problem with latiness that you speak Italian that people spoke Italian didn’t prevent
Florence Venice Genoa and so forth being great centers of trade and Innovation and indeed an interesting fact about southern Italians who were unspeakably poor in their home in in Calabria or or Julia they come to the United States or Britain or Australia they’re amazingly successful so it’s not because they speak Italian
Or or eat spaghetti or read read the metal method of Comedy knows the opening lines of the amphetamine but anyway there’s nothing deep but I think about Latin look everyone said about China when I was a kid and about India when I was a kid when I was a young Economist
Oh they’re hopeless there’s an Asian dilemma their culture prevents them from and then in 1978 the Communist Party decided to adopt markets boom upwind of the economy same thing happened after 1991 in India so it’s not deep I I think the Deep argument is a mistake the the Deep argument says you’re fated
Because your Portuguese um no no Palma talks this way a lot and I want to try to help him get over that pessimism oh your Portuguese there’s no hope which is ridiculous modern portrait is very rich by comparison with I don’t know Somalia or indeed Portugal in 1800. That’s right but but there are Universal motivators profit Glory that’s a dangerous one but profit advancing your family Innovation just the joy of doing new things starting a new company or saving up some insults and those will work in any any human population now there are particular obstacles I suppose
The opening line of Anna Karenina is that um happy families are all the same unhappy families are unhappy in their own way so I kind of agree with that I understand what what Costa was saying but but I I I don’t think there’s a big um
Look here here’s how to how I kind of summarize it liberalism works everywhere massively from the 18th century on it’s why modern economies are rich it’s not because of the state intervention it’s because letting people much more than before allowing them to have a go as the British say
And then there’ll be spectacular modern cases of introducing liberal economics alas not always liberal politics places like China and India or Botswana that works I actually have good example that people forget about is Ireland which although it was not completely poor the first time I visited it in the
In the summer of 1960 uh uh six it was quite poor now of of any moderately large country it’s the fifth most rich country in the world why is that not because of government policies other education with someone and tax rates well that’s but their tax rates are a liberal policy low corporate
Tax rates That’s right that’s right and and you and actually a more important example than Sports gambling although I see what you mean by the way the the biggest gamblers in the world are the Chinese were absolutely obsessed with gambling so don’t tell me that the Portuguese are peculiar in this respect but a more
Important example is that you can get rich by stealing from people so you can get rich by getting ingenious about stealing or you can get rich by getting more clever at the convincing the government to steal from them that’s the bone argument that’s the that’s the moment and okay
So what we need to do is block those ways yeah they’re they’re your point about incentives is perfectly right you’ve got to make sure we catch people who are trying to steal certainly outright stealing so so that people are moved into trying to invent stuff Well that’s right and we’ve we tried and that failed in Iraq too yeah that’s right although um yeah I yes to go back to your earlier point it is true that the unhappy countries are unhappy in their own way in uh in Africa if in Afghanistan and in much of the
Middle East the problem is tribalism um which is a serious problem in any it was a serious problem in England once and then gradually disappeared and we started being able to make deals with with strangers um and that’s yeah then you have to work on tribalism either make the tribes behave economically
And somehow keep them from using their course of our persuasive powers to prevent economic growth well in in fact that particular Point’s a very important one because a big state it takes a big share of national income and has all kinds of regulatory Powers it’s very tempting to corrupt
Boy if you can get control of the United States government or the French government your fortune is made or of a strong regulator exactly so that that’s one argument it’s a quite General argument about making States little my own city of Chicago was the fastest growing city in the
World in the late 19th century 1900s just Boomtown and was fantastically corrupt police were for sale judges were for sale politicians were for sale you think well how is that going to work it worked because the government roll was small anyway so then it was corrupt didn’t matter Oh they’re wrong it’s uh it’s it’s a mixed economy and it varies someone from state to state and how much mixed it is but it’s a mixed economy for example people think that Health Care in the United States is entirely private and that poor people don’t get any help and that’s wrong um
I’m an example here I am a liberal who wants a small government I haven’t paid anything for Health Care since I was 65 years old because we have socialized medicine for old people and for very poor people and for certain kinds of handicapped people socialized medicine
And so the the contrast that people draw between say Sweden or Portugal take two cases and the United States is often greatly exaggerated because of the talk that he that Americans have they say oh yes we’re free and and let so you’ll say a farmer getting enormous subsidies from
The federal government will say well I’m in favor of free markets but don’t touch my subsidy from the federal government well Look I’m in favor of helping people not places if if Portugal decides to become a socialist Paradise and ends up poor and many people leave Portugal well okay it’s not the land that I want to subsidize or help or encourage is a better way to put it its people and if
The best thing they can do is exit they should exit they should move to the United States or or to England or something but if they want to succeed in Portugal look if they want to succeed in a liberal way they should start a business they should get into business and do it
Well and and be entrepreneurs there’s still room in Portugal for entrepreneurship and uh they’ll have to fight against well this very institution is a good example I was told by the man who started it who now has 46 or 42 no 46 branches of this all over the world
Um he told me that the educational bureaucracy in in Portugal hates him because he’s got a model of hire of certain kinds of higher education where the students who teach each other and work on projects and that’s their only guidance so it’s got It’s it’s expenses twenty percent what’s higher education usually costs
Well so but in any kind of business you’re going to be fighting against the forces of Regulation and socialism and don’t do that don’t do this but I think is that you look in the United States we always say to our soldiers thank you for your service
They get to go on the airplane first they’re in uniform well look anyone who starts a business or for that matter Works in a business they’re giving service we should be thanking everyone in fact frequently on the street when I see someone sweeping the street I
Go to them and thank them for their work I should thanking each other all the time but in any case for young people get educated I think it’s fair to say but then go work in business and try to improve the well-being of other Portuguese people
Or go work for for a think tank and try to change their minds