Capitalism - The Human System | Yaron Lectures

I want everyone to give a very very warm welcome to Mr. Y. Thank you. >> Wow. All right. I haven't said anything yet. I don't I feel like I h I don't deserve that. I haven't I haven't worked for it yet. Right. All right. So, what what I want to talk to you about today really goes to the essence of I mean you guys are a political parties, a political youth movement and it really goes to the essence of what do you really believe? What are your ideals? What do you strive to achieve? What are the principles that will guide you as political activists, as politicians one day, as just human beings? What do you really believe in? And the reality is that most people and most people in politics don't really believe in anything and some kind of mixture of stuff, right? Everybody wants a little bit of freedom and a little bit of controls, right? U you know, we want free markets, but we don't want to give up the welfare state. We want free markets, but we have to regulate a lot of the businesses. We want I don't know, you know, you want you want free trade, but not with everybody. And we want some tariffs to protect the industries you want to protect. Maybe you want to protect different industries. So, we'll compromise and figure out which ones to protect and which ones not to protect. Right? What we have today in the world everywhere is a mixed economies. mixtures of freedom and you know uh uh lack of freedom however you want to describe that. You know some markets and welfare systems markets and lots of regulations and some industries we leave alone and some industries we completely control. Right? You guys believe, my guess is 90% of you believe that private industry should make the iPhone, >> right? How many of you think that the iPhone would be better if the government built it? >> Anybody? >> Nobody has the guts, right? What What do you think this would look like if the government designed it? >> Like an Nokia. Well, even worse than an Nokia because Nokia is somewhat private, right? It would be horrible. There's no audience in the world that I've ever asked, "Do you think the iPhone would look better if the government designed it?" Nobody thinks that. Not even a group of socialists really believe that, right? But how many of you think that the government designs health care better than the private sector? >> Almost all of you do. 90% of you think government should provide health care, but you don't think the government should build an iPhone. What's more important, an iPhone or healthare? >> Healthare. >> Healthcare is much more important than an iPhone. That's why we shouldn't have the government do it because it's more important. But that would require principle. And we don't hold those principles or education. How many of you think education is more important than an iPhone? Yeah. Everybody thinks education is more important than an iPhone. So, we give it to the government to do because it's more important. So, the the things that are more important, we let the government do. And the things that are less important we give to the private sector. But wait a minute, we said the private sector does it better than government does. So what almost everybody today in politics is confused in my view a mixture and you won't challenge they won't challenge kind of the the the status quo the existing beliefs that things like healthcare and education have to be done by the government that welfare yeah we want to shrink I mean you guys I believe want to shrink the welfare state but if the welfare state's wrong if it's I believe immoral Then why would we shrink it and not eliminate it? Now partially I know you you're in politics so you can't say eliminate it because you won't get elected if you say it. But I want to change your belief. So I want to challenge your beliefs even if you you know maybe then you you can lie to your uh you know to when you try to get elected. That's fine. But at least I want you to believe believe something, right? I want you to think about what you actually believe, right? Do you actually believe that the government does a better job at health care than the private sector would do at healthcare? Do you actually believe a government should, you know, does a better job in education than the private sector would do in education? Then why do you advocate for public schools and for public healthare? All right. So here's the thing. In the world today, everybody is united about one thing and that is pretty much everybody left and right hate capitalism. Now the right gives it lip service. You know what lip service is? They say they like capitalism but they don't mean it because they want to socialize pretty much everything. Health care, education, welfare, regulation. Nobody's for eliminating those. So nobody's really for capitalism. There's a unonymity and and and indeed the new rights, the right that is becoming much more popular around Europe and the United States, the Donald Trump's of the world, the the populist right is super anti- capitalism. They want more government intervention. I mean, I don't know if you follow American politics. I'm sure you do because it's hard to ignore Donald Trump or not to follow Donald Trump. But um the the Trump administration is taking equity positions. Equity means ownership positions in dozens of companies. What do we call it when the government starts owning companies or we could call companies something different? What does it mean when the government starts owning the means of production? >> Communism or socialism. And that's coming from the Republican party, not from the Democratic New Socialist Party, right? So today, you know, pretty much everybody across the political spectrum believes in some socialism and and actually quite a bit of socialism. So part of the question I want to ask is why that is. And and maybe you can tell me, right, that capitalism failed, right? If capitalism failed, then it's cool. We we should abandon capitalism. we should all become socialists because capitalism sucks, right? But is that the case? Has capitalism failed? Has capitalism actually done a bad job? >> So, what was life like? What was life like before capitalism? >> What's that? >> You said no. >> Wasn't too good. >> It wasn't too good. What was life here in Norway like before capitalism? >> Sucked. >> It sucked. There's a good technical term I really like. Life sucked, right? Why did it suck? Because life expectancy was >> very low. How low? Like most of you, what are you? Uh early 20s, late teens, early 20s. Most of you are middle-aged because within 10 years, maybe 15, you're all dead or average dead. You know, most of you wouldn't be here because 50% of people died before the age of 10. 50% of children died before the age of 10. A a large percentage of women died giving birth. And life sucked, right? Everybody was poor. Most of you were farmers. Most of you subsistent farmers. What does that mean? That you didn't trade. You grew the stuff that you ate. And you did that. That's hard work. That is hard work. People complain today about work. Today's easy as compared to what it was. And indeed, life was like that from the beginning of time. If you think about human history, at least since the uh I don't know the agricultural revolution 10 12,000 years ago, income and wealth of human beings were basically flat for 10,000 years. I don't know if you've seen the hockey stick, the famous hockey stick graph, not the ones uh not the not the global warming one, uh the the wealth and income one, right? The global warming one is made up. This one is real, right? Um, well, it's made up. I mean, according to hockey stick, we would have all died by now. And Greta has turned out to be wrong, right? Isn't it Isn't the time scale, aren't we supposed to die any day now? >> It's soon, right? All right. It doesn't look like we're going to die. You guys are not going to die of warmth anyway. >> That ain't happening in Norway. As I I I I've been saying for 20 years now, nowhere in Canada will finally become habitable. I live in Puerto Rico, so you know, um I like warm. So for 10,000 years, basically, here's a graph. I'm going to draw a graph in the air, right? This is this is wages and wealth flat. Like it went up a little bit during Greece and Rome and then it came down during the dark ages and middle ages and it start creeping up during the Renaissance and went up a little bit and then suddenly out of nowhere it went like that right hockey stick. It went up by some measures a thousand times not a thousand% a thousand times and by other measures much more than a thousand times tens of thousands of times. We are wealthier today than we were 300 years ago by tens of thousands of times. Why do I say that? Income's gone up by about 300 times. Uh why do I say tens of thousands if income's only gone up by a few hundred? What do we have today that they didn't have 300 years ago that you don't really pay that much money for but is a huge benefit to your life? >> Oh, suddenly we have oil, which means what? Because oil is just this gunky black ugly stuff. So what is the value of oil? >> Value of oil is in >> one word. >> Energy. Exactly. Energy. And don't raise your hand, just yell. Uh it's it's easier that way, right? Energy. So we have really really cheap energy. Unbelievably cheap energy. We can drive around. We can fly around. We can do amazing things because we have really really cheap energy. And what is the what is one of the products of that energy right that we have a little bit in this tent? >> Electricity. >> Electricity. Now we pay very little for electricity. So in the wealth numbers you don't really catch it. But if you look at quality of life, imagine life without electricity and all the things that rely on electricity, computers and you know AI and everything else. This microphone, the lighting in this tent. Imagine what all of that would be like if we had to light candles. We'll still be hunting for whales because we'd need whale oil in order to light. You know, you know, the oil industry saved the whales. They did. I mean, there would be a lot fewer whales in the world if not for oil. So, next time the environmentalists tell you the evil of oil, you can say, "No, we saved the whales. Because the reality is that uh rich people used to use whale oil to light their homes. What did poor people use to light their homes? >> Nothing. Because they couldn't afford anything. So they lived in darkness. Part of the increase in standard of living thousands of times better because of that. So what happened? How did we get so rich? >> Yeah. Basically capitalism. And what do we mean by capitalism? >> Innovation. >> Well, innovation. But where does innovation come from? Why did innovation start about 300 years ago? Whenever whenever that time is. Why did it start then? And why was it not before? >> Global trade. >> What's that? >> Global trade. >> Global trade. You know, if you study trade, you'll discover that trade has been, you know, given transportation has been global forever, right? We've been trading with one another since the beginning of mankind. So industrial revolution, but why did the industrial revolution happen when it happened, >> right? >> Free trade again. We've had free trade for a long, long time, right? The Greeks were trading with the Scandinavians. Uh, you know, do you guys see the Odyssey? You seen the Odyssey yet? Some of you, I'm going to see it in a couple of days, so don't tell me the ending. Um, but you know, there was free trade back then. the the ancient Greeks were trading with Scandinavia. They were trading with all the way to India, maybe even to China. So there was there was trade going on. It was just slow because transportation was slow. But there was trade going on. Something happened 250 years ago to make this go up. And somebody said capitalism. But what do we mean by capitalism? What does capitalism actually mean? >> What's that? >> Productivity increases. Yes. All of that happens. But why? >> Freedom. >> What's that? >> Freedom. >> Yeah. Freedom. Private markets is an extension of freedom, right? So freedom happens. Now what does freedom mean? Like why weren't we free before and then suddenly were you free? About 250 years ago, the world became freer. And I say the world, I don't really mean the world. I mean what countries? >> America. >> America and Britain basically. And then it started spreading. You guys didn't become free until when? late 19th century >> 1905. >> Yeah. 1905 in Norway. Uh so different countries became free in different places. And what does freedom mean? Anybody see Braveheart the movie Braveheart? >> Do you remember the Scots in Braveheart? They they they they yell freedom and they go into battle yelling freedom. What do they mean by freedom? Is that the same thing we mean? >> Yeah. They they wanted freedom to be ruled by a Scottish king instead of an English king, but they still wanted to be ruled. And what do we mean by freedom? Or should we mean by freedom? Well, we're not ruled. Freedom means that you have the ability to live your life as you see fit based on your own values, based on your own thinking, based on your own abilities. Free of with the absence of what? >> Tyranny. >> Tyranny. Tyranny is a an extreme version of this. But free of what? >> You have to yell because it's hard to hear up here. >> Yeah. Fear of the government doing what though? >> Control. How do they control? What do they do in order to control you? >> Taxes. >> Taxes and regulations are form of what? >> Authority. Coercion of force. It's free of force, right? Taxes a force. Coercion what? that we that we can decide how how we want to live our lives instead of >> Yeah. I'm saying freedom means you get to decide how to live your life >> and your neighbors don't get a say in how you're going to live your life as long as you don't do what? >> Punch them and do you know inflict your force on them. But why is it the business of your neighbors what you do? >> Yeah, we all influence each other's life mostly for for the positive. But if you really influence it for the negative in terms of force, >> so force is out, right? Freedom means no force, no coercion, you can't punch your neighbor in the face, right? You can't steal this stuff. But except for that, freedom means being left alone. To do what you want to do, to be nice to your neighbor if you want to, to ignore him if you want to. To be rude to him if you want to. You have a right to be rude. >> Yeah. Why do you have a right to be rude? >> Yeah. Freedom of speech. You have a right to offend. You have a right to be rude. You have a right to I know you guys don't like to be rude, but you know, you have a right to do it. Your neighbor can't use force against you just because you were impolite to them. Although, right, Europe now has anti-free speech laws all over the place, right? Because you're not allowed to offend people. You might hurt their feelings and we have to protect the government has to protect people from having hurt feelings. Used to be that we only protected people when they committed fraud or they punched people. They used force. Now we protect because we have delicate emotions. >> You think it's woke? >> Do I think it's woke? >> So what was the first law that was passed that restricted the ability of people to offend people in Europe? >> It was a lot before woke. What was the first law that was passed? then you you'll probably be sympathetic to this law because because it's it's silencing people we don't like which objectively we shouldn't like but what was it about >> well that's a long time ago but in modern times what's the first law that restricted free speech in Europe what is the one thing in in parts of Europe that you argue for and you could get fined. The government will come after you. >> Yeah. Hate speech is >> what's that? >> Yeah. No, I mean something very specific. >> So, I'll just comment on hate speech. What does it mean to What does it mean to say hate speech? Right. I hate communists. I really do. >> And I hate fascists. I really do. Is it okay for me to hate them? Yeah, it's absolutely not just okay. I think it's a vu to hate communists and fascists and I should be able to say you guys suck. You guys are evil. You guys im moral. Are they going to be offended? Yeah. Should we stop that? I mean, what does hate mean? Hate is an emotion we feel against something that threatens us. Hate is a good thing, not a bad thing. It's a survival mechanism. So, the idea of banning hate speech is ridiculous. that the first law that restricted speech in Europe was a law against Holocaust denial. Now, Holocaust denial is evil. It's wrong. It's stupid. It's ignorant. But you have a right to be ignorant, stupid, and any moral as long as you don't hurt other people. So if you're willing to be for if you're for free speech for example you have to be for free speech all of it including the stuff you really really really hate like I hate communists and fascists they have a right to speak and I have a right to be hateful in my speech against them that's what freedom means so again we like to be middle of the road on everything I don't I'm radical pretty much everything. So I believe that if you have free speech, you have to let everybody speak, including people who are hateful, including people who I don't like, including people who I hate, including people who objectively without any question are lying or deceiving or or wrong in what they say. So freedom freedom means the absence. Freedom means the absence of force. Freedom means no coercion. No force. No force inflicted on people who speak stuff we don't like. No force inflicted on people who do things we don't like. The only time force is legit. When is it okay to punch somebody? >> Self-defense. Absolutely. >> In defense of others. >> Or in defense of others. But defense, right? If somebody's attacking, we can use force against the attacker. So that is the only time it's appropriate to use force. Right? Now, what is the nature? What is the nature of government? What is the essential nature of government? What makes government different than business, than regular interaction that we have? Well, somebody said it. The government is the only entity that is allowed to use force, right? It has a monopoly over the use of force. Always has. That's the nature of government in nate. The government is a gun. So if we said freedom means you can do whatever you want ex except viol you know punch somebody else and it's only legitimate to use force in self-defense. When is it only legitimate for the government to use force? When should the government use force? >> Well, it depends on the law, right? If I make a law that says you can't speak a certain opinion, then is that legitimate for the government to use force then? >> So, when is it legitimate for the government to use force? >> Yeah. So you said before it's okay to use force when it's in self-defense. So the government's job is to use force to protect people. In other words, in self-defense. Now, what would that mean if the government only used force against self-defense? What would the government do? Like when you go to the doctor and and talk to the doctor and you know because you're sick and and you're not feeling good. Uh does the government have is there self-defense involved there? And yet the government sticks its neck and sticks its business in there and tells the doctor what he can and cannot say to you, what diagnosis, what treatment he can and cannot give you. But that's not self-defense. So if the government should be limited to self-defense, right? Because that's what force is limited to, then the government has no business in what? 90% of everything it does. 90% of the laws passed have nothing to do with self-defense. And yet every law that's passed is force. Is force. So we'll go back to what caused this increase in wealth and income. What caused it is freedom. It's the establishment of country after country after country where the government was limited. Limited to protecting the rights of individuals. And what do rights mean? We talk about rights all the time, but rights mean freedom. Rights mean freedom of action. that the idea that every individual is sovereign, every individual has a right to choose their own values and pursue their own path and nobody has a right to use force on them in contradiction with their own views, their own ideas, their own motivations. So what happened is you know I like there's a particular date that I like when this starts going up like that. What what do you think the date would be? What would be a good date to start? 76. >> 1776. Somebody is uh somebody's been cheating. You've heard me do this before because that was the quickest 1776 I ever got from an audience. All right. Yeah. 1776. Why 1776? The three reasons. >> Independence. >> Declaration of independence is the obvious one. Let me leave that to last because I want to talk about that a little bit. But the other two reasons are one, what book, famous book was published in 1776. Wealth of Nations by Adam Smith, right? I would say you should all read it, but it's actually pretty hard to read. It's not an easy read. So, you know, if you're really motivated, go read it. It's a good book, but beware. It's it's not easy. Um, se The Wealth of Nations was a book about capitalism. It was a book about the value of free markets, about the value of free trade. It destroyed moanalism. According to the wealth of nations, what is the best tariff rate that every country should have? >> Zero. Adam Smith proves that zero tariff rate is the exactly the right tariff if you want to benefit your own country. Anytime politicians tell you we no, we need to protect ourselves by raising tariffs point to wealth of nations. The arguments against it are all in the wealth of nations. It's only 250 years old. So maybe it takes like 500 years for politicians to actually understand it. Sorry, I know there's some politicians in the room. But uh reality is it's been proved zero tariffs is the only rational rate of tariff. In spite of everything you hear from Donald Trump and every other politician out there, they're actually hurting their own country when they raise their own tariffs. That was Adam Smith. What else happened in 1776? Second thing that happened was the first use of the steam engine for industry for actual in a factory. So you get the beginning of the industrial revolution. Somebody said industrial revolution. And the third is the declaration of independence. And why is the declaration of independence important? I think it's important. I think the 4th of July should be celebrated as a global holiday not just an American holiday because I think the whole globe benefited from it. The Declaration of Independence is a declaration of freedom, not just American freedom. It's not about declaring independence from the UK, from the from the British. It's about declaring the independence of the individual, from the state, of the individual, from his duty to the collective. It's about the individual freeing himself. The Declaration Independent says you have a right. Every single individual on planet Earth, not just Americans, every single individual has a right to life, liberty, and the pursuit of happiness. Now, what does life mean? What does a right to life mean? What does it mean to say you have a right to life? >> Self-government. >> Yeah. Self, you have a right. In other words, you have the freedom to act and think and speak whatever you want. It's nobody else's business what you do unless you're violating their rights. And the only way to violate somebody else's rights is with force. You have a right to liberty, which means you have the right to ACT AND PURSUE YOUR values and speak and write and publish your stuff free of force, free of coercion. And you have a right to pursue your happiness, right? Pursue your happiness. That's very individualistic, right? Only you know what's going to make you happy. And again, as long as you're not violating somebody else's rights, as long as you're not forcing using force on other people, nobody has the right to tell you you can't do that or here's what you should do because this will make you happy. Avoid it. This other stuff can't do that. I mean, the declaration of independence is a declaration of freedom. It's a declaration of independence of the individual from fill in the blank. Whoever governed, used to govern what who used to govern the individual. So before like before the u this massive increase in wealth before the declaration of independence who did your like belong to >> the nobles the king who else >> what's that >> owners of land >> owners of land who did your life who and even the no the owners of land who did their life belong to the king right somebody above them there was always somebody above you who else did your life belong The church. >> The church. Absolutely. Religion. Your life belong to God and the church and the church governed and told you what to do. I mean the tribe that you know the the the the witch doctor the the church which is very similar um the u the king your life didn't belong to you. What the declaration OF INDEPENDENCE SAYS NO that's all wrong. Your life belongs to you not to them. You get to run your life, not them. What is the modern version? This is like this is the most controversial thing I'll say probably today to you. What is the modern version of king, tribe, church, all of that? Who who does your life belong to today? Like in Norway? Well, politicians are just they're just reflective of the culture, right? So, you know, don't blame politicians for stuff. Blame yourselves. Anything politicians do is the fault of the people, right? We get the politicians we deserve. Like in America, I I mean, it hurts me to say this, but we deserve Donald Trump. I'm not a fan. You might not have noticed, but I'm not a fan of Trump's and and we deserve Obama and we deserved Biden. We deserve these people, right? because we we voted for them and we couldn't find anybody better. So no, what's what's the what's the authority that basically dictates your life and your life doesn't really belong to you, it belongs to them? >> Democracy. >> Yeah. Democracy >> this well democracy the majority. The individual doesn't matter anymore. What matters is what the dem the majority believes. So if the majority thinks that hate speech should be banned, it's banned. If the majority thinks that the government should make iPhones, then the government will make iPhones. If the majority thinks that, I don't know, they just don't like you, then they'll find a way to get rid of you. I mean, democracy, pure democracy, majoritarian democracy, where the majority always governs, is anti-individual liberty. It's anti-individual freedom because it basically says the group, the majority of the group gets to decide what an individual can or cannot do. If you don't believe me, you know, try starting a business and, you know, say I'm I'm I'm just going to do my thing. And, you know, the majority will come in and say, "No, no, you've got here the regulations. Here are the controls. Here are the things you have to abide by. You are not free, but you're not enslaved to a king. You're not enslaved to a tribal leader or witch doctor anymore. Now you're enslaved, particularly in Europe, but also in the United States, to democracy. And there's nothing to protect you. At least in the US, we have a constitution and a bill of rights which a little bit protects us. But you don't have those protections. This is why you can have speech hate speech laws in Europe and we we don't have hate speech laws in America because we have a you know the first amendment. We lucked out. Nobody in America believes in the First Amendment anymore, but it's in that ancient document. So, we're cool, right? We have a quote that still upholds it sometimes when it feels like it. So when I say freedom, I mean freedom. Freedom of the individual to act based on his own values, based on his rational mind, free of coercion, free of force. And I don't care if that force comes from the majority or it comes from a king or it comes from an invading army. Force is bad no matter where it comes from. So we got rich when we recognized the value of the individual and we gave the individual freedom. And when you leave individuals free, what happens? Somebody's got his hand up patiently. Is that a question, a comment? >> Because we will have a Q&A at the end, but go ahead. Uh, >> okay. So, let's let's Yeah, we we we Okay, so that's the uh I guess the hanging question. So, if you don't have democracy, God, awful. What are we going to have? This is this is horrific. Um, you know, how are we going to govern ourselves without democracy? Well, anybody have a solution? How would you govern yourself if you didn't have a democracy? >> I'm against anarchy. Anarchy is worse than communism. Because anarchy is war against war. It's everybody against everybody. >> What would you what would you do without democracy? >> What's that? >> Autocracy means what? >> Hierarchical rules. >> So hierarchical rule. So you're still being ruled by somebody. I'm for freedom, right? So I can't support some somebody else ruling over you. to h how how do we how do we how do we get rid of rulers without democracy? I mean, I believe democracy is a form of ruling, right? It's just a majority ruling over the minority. What's the smallest minority in the world? What's the smallest minority in the world? We always want to protect minority groups. Well, what's the smallest minority we should be protecting? Who? >> Yeah. Individual. The individual is the smallest minority. You are the smallest minority. Nobody else is like you. You are unique. Every single one of you. That's the minority we should be protecting. So, how do you create a system where you protect the individual, protect the minority from the majority? Any ideas? Who tried to do that? Were there anybody anybody in history tried to do that? try to create a system of government that was not democratic in the pure sense and tried to protect the individual from the ability of other people to control them. >> The founding fathers of America tried to establish that kind of system and I think they did a damn good job. It's been perverted and distorted since but the original mechanism system was the right mechanism. What do you do? You say individuals have rights. Those rights can never be violated. So yes, you can vote. You can vote on everything except you cannot violate the rights of the individual. So we elect our leaders by voting but the leaders are impotent. They have very little power. The only power is to protect rights and you do that with a constitution. The reason to have a constitution is to limit the power of government to make sure individuals remain free. So I would call it if you wanted to give it a name a constitutional republic. You can even call it a constitutional democracy. But it has to be it's a democracy limited and restricted by a constitution to only that which government should do. And what is the only thing government should do? use force to protect people in retaliation. That's capitalism. And that was the original American system. Of course, they compromised right in the beginning. What was the biggest compromise Americans did? What that made the whole thing? You know, the original sin in the founding of America is what where they didn't protect the rights of individuals. What's the original sin in America? >> Slavery. >> Slavery. They allowed slavery. It was, you know, they they violated the principle from the beginning, which is sad and unfortunate and a tragedy really, not only for them, but for all of us because we've never seen a a system like this. But yes, what would replace democracy should be a limited democracy, a democracy limited by a constitution, a constitutional democracy that protects the rights of individuals. So if it says you have a right to free speech, 99.9% of Americans can vote to silence me. And 99% of Americans want to silence me, but they can't because there's a constitution that protects my right to speak. If there was a constitution that protected my right to engage in trade, my right to produce and build a business, my right to live my life free of corrosion. If the constitution was more explicit about those, then they couldn't, the government couldn't intervene even if it was democratically elected, even if 99%. So the idea is to protect the freedom of the individual. That's what government should be focused on and pure democracy cannot do that. You will always get majorities oppressing minorities and again smallest minority the one to be oppressed first and foremost is going to be the individual. So for the first time in 1776 we abandoned the idea that we should be ruled by other people. We should be ruled by kings or tribal leaders that we should be ruled by majorities. The idea in 1776 that liberated I think the world was the idea that individuals should rule themselves that you own your own life. Indeed, today if I go anywhere in the world and I ask you who owns your life, who owns your life? >> Well, you guys are cynical now, but who owns your life? If I really asked you, >> you do. And most people believe that. If you go to China and you ask them who owns your life, they'll say, I own my life. And where did they get that idea of self ownership? They got it from one way or the other. They got it from the founding of America. This is why I think that should be celebrated as a global holiday, not just an American holiday. Right? Fourth of July 1776. So we liberated human beings. And what happens when you liberate human beings? What do they do? What do they do? What happens when you allow people to be free? >> They start businesses. >> They start businesses. And they start businesses without without having to ask permission. So if you look at the industrial revolution, the beginning of the industrial revolution, nobody had to give you permission to start a business. How many forms do you have to fill out in Norway to start a business? >> Too many. >> How many different bureaucrats do you have to get permission from to start a business? >> Countless. >> Countless. And it takes it can take months and can take years depending on the type of business. But if when we achieved this change in wealth creation at that point in time, the reason we had an industrial revolution then was because you didn't need to ask permission. You just started a business. And again, as long as you weren't enslaving people, as long as you weren't using force on people, you were left free. You were left alone. And what what were taxes like? I mean there were almost no taxes because what was government? Government was tiny. What did government do? It protected. So it needed a mil a police. It needed a military and you need a court system to arbitrate disputes and maybe a patent office and a few other little things but that's it. So in the United States for example in the 19th century as a percent of GDP what was the size of government? percent of GDP. What is what is it in Norway today? What is the percent of GDP that your government spends? >> Over 60. >> Okay, that's high, right? Over 60. So more than half of your economy is run by the government. That's borderline what? >> Communist. >> Yeah, borderline communism. Um, you know, it's socialism at scale, right? 60% of your economy is run by the government, by a bunch of bureaucrats. What was it in the United States in the 19th century? Want to guess? >> You have to yell. >> 5% under five. Three and a half%. Three and a half%. And was America like the poorest place on the planet earth and a terrible place to live and nobody wanted to be there. Everybody tried to escape because the government was so small. >> No. >> What was h actually happening? >> American dream. >> Well, everybody wanted to come to America. Even some Norwegians, >> a lot of Norwegians came to America, right? Why did they come to America? Because at three and a half percent, what was created? >> A lot of freedom, a lot of business, a lot of opportunities. People came not for the welfare, not for the socialized medicine, not for the public education. They came to be free. They came to build. They came to create. They came to make stuff. They came to build a life because at three and a half percent they were protected and left alone. And that's the ideal government that protects you and leaves you alone. Three and a half%. Imagine reducing the Norwegian budget to three and a half% of GDP. That would mean reducing it by 95%. 95% not by you know you I I know your your political party has some uh ideas on how to shrink government spending you know eliminate foreign aid what's that half a percent or 1% and then you know reducing welfare a little bit another 1% maybe maybe if we add everything up you would shrink the role of government by 5 to 10%. I'm talking about 95%. That's what freedom demands. Okay, I'll settle for 80, right? If you can pull that one off. That's And what happened to the economy? How did the economy do during this period of time where the government only spent three and a half%. >> It grew dramatically. What happened to life expectancy? It must have gone down because God without government healthcare, we'll all die. >> It increased drastically. Life expectancy almost doubled during this period. What happened to u let's see child labor during this period >> well put it aside what happened to it >> became less >> it became a lot less common what did children do before the industrial revolution other than die >> which is about 50% of them died. So what what did they do other than die >> they work where did they work >> on the farm. So during the industrial revolution, what happened to child labor? It went down. By the end by the end of the 19th century, child labor was in most places was very close to zero. Certainly by the 1920s, it was gone. I mean, in every respect, human life got better in spite of having a tiny little government. Now, you might say that's unique to America and maybe England of the 19th century. That's different. The 20th century, it can't happen. Anybody here ever been to Hong Kong? >> No. Nobody's been Oh, no. She's just stretching. I thought that was a hand up, but he's stretching. All right. So, nobody's been to Hong Kong. >> She's mean to Hong Kong. Yeah. What do you think? >> It's fine. >> All right. She's She thinks it's fine. I think it's amazing. Right. It's It's an amazing place. Right. So, there's seven and a half million people live in Hong Kong. It's got more skyscrapers than Manhattan than New York City. Uh it's vibrant. It's dynamic. You know, it's it's fallen. It's very different, right? But it's an exciting place. And you can see the wealth that's there. Now, what was Hong Kong when the British took it over just after World War II? Anybody know what Hong Kong looked like back then? >> What's that? >> Harbor. >> It was There was a harbor, but there was nothing there. There were 70,000 people split up into a number of fishing villages around the thing. Hong Kong has no natural resources. A harbor, but there are lots of places that are good harbors. It has no natural resources. GDP per capita today and and sadly China's taken over Hong Kong, so it's not as good as it was a few years ago, but GDP per capita is >> Yeah. >> Singapore, >> Singapore is very similar, right? just a less free but very sim very similar GDP per capita higher than the United States. So it went from a poor fishing village to a country richer than America in a third of the time it took America to get that rich. So it 70 years more skyscrapers. How did it do that? How did how did Hong Kong become so rich? >> Capitalism. capitalism. They basically freed them, right? They left people alone. And why did people come there? So, it had massive immigration. I know you guys don't like immigration, but they had massive immigration. You can ask me about immigration afterwards, but massive immigration. So, they went from 70,000 to 7 and a half million in 70 years. You don't get that from natural birth rates, right? That's massive immigration. Why did immigrants come there? >> Low taxes. >> Very low taxes. Well, what else? They freedom that many of the Chinese don't have. >> Yeah. People people escaped China in any way that they could to try to get to Hong Kong. I mean literally people used to swim and many died on the way. Rafts, little rafts. And people died on the way. Why? Because they were going to get free healthcare? No. Because they were going to get welfare? >> No. Because they were going to be regulated? So they knew they'd be safe? Because god forbid if we have unregulated industry, the businessmen will you know what would they do? What what what would happen if we had unregulated business? >> They'd kill us all. What do you mean? Aren't the regulations there to protect us? >> So regulations are not taxes, right? Why do we regulate businesses? >> Make sure they don't steal. >> Yeah. Make sure they don't steal. We've always had laws against fraud. We don't need more laws of good. When you go into an elevator in in Norway, right, I know in America when you go into an elevator, there's a little diploma. There's a little thing on the on the elevator wall that says a government inspectors inspected this elevator and it's good. It won't fall. It won't kill you. Right? Because we know in America at least, maybe in Norway it's different, that if we left it to private industry, unregulated, to build elevators, they'd all be dropping and they'd kill us all because the best way to make money is to kill your customers. You didn't know that. This is the secret of getting rich. The be Why do we have food inspectors? Because without food inspectors, McDonald's would poison you. I doubt it, too. But in but for some reason a majority of people out there don't doubt it. They think it's real. They think if you don't regulate businessmen, they will kill you. Hong Kong had no regulations or very little regulation, very little taxes, very little control. Everybody wanted to live there and they got rich. And yet nobody wants to be Hong Kong. Like nobody's trying to mimic that. Nobody wants to be 19th century America with three and a half% of GDP. We want to be like, I don't know, we want to be much more like um what like East Germany or something. We're much more likely to move towards more and more and more controls, more and more and more regulations, more and more and more taxes, more and more and more restrictions on your life. That is the tendency. And one of the reasons that tendency exists is because nobody out there in the world is saying no, we want freedom. Real freedom. Freedom that means not just lower taxes, but much much much much lower taxes because we want a much much much smaller government that actually leaves us free to live our lives as we see fit. And because nobody's advocating for that, because no political party on the right will actually advocate for capitalism. They're all mixed economy. They're all compromising. And if you COMPROMISE WITH SOCIALISM, guess who wins? Socialists. If you're unwilling to stand for freedom, real freedom, then guess who wins? The people who are anti-freedom. the people who are against it and that's been the case for 150 years in the United States at least that's the history I know what has been what has been happening to size of government >> it's growing and grow it doesn't matter if it's a Republican or Democrat it doesn't matter who the politicians are sorry somebody said politicians earlier it doesn't matter who the politicians are because the culture demands more and more and more and bigger and bigger and bigger government, more and more services, more and more goodies, more and more regulations, more and more controls. And yeah, a Republican might come in and deregulate a little bit, and then four years later, they'll reverse all the regulations. And maybe a Democrat will deregulate. A lot of times, it's the left that does the deregulations, but government only grows, and it's only grown for over a hundred years. And the reason is in my view, one of the reasons is nobody is willing to actually stand for freedom in politics. It's always compromise. It's always selling out. It's always appeasing the other side. The left always tells you exactly what they want. They want to control the means of production. They want to socialize everything. They know it and they're just moving slowly in that direction. The right doesn't tell you what they actually want. If you know to the extent the right believes in freedom, they don't tell you they want actual freedom. So you never move in that direction. You never go in that direction. But what matters in politics is protecting the individual. What should matter in politics is protecting the rights of individuals. That's what freedom means. And that means a dramatic shrinking of government. It means a dramatic change in the whole way we approach politics and we approach the role of government. The role of government is should be shrunk to protecting rights. And that means, and I know it's tough, but that means no iPhones produced by the government, but it also means no subsidies of industries that you think are favored by your political party. It also means what would happen if you had no welfare state? What would happen to people? >> People would be forced into actual work. I don't like using force in that context. >> Not directly forced. >> Nobody would force them. They would have to work because that's what nature demands. Reality demands that you work for a living or what's the alternative to work in a free society. >> Well, ask for charity. Ask for other people to help you. Here's the difference between a charity system and a welfare state. A welfare state, you demand that they help you. You stick a gun in their back government and demand their money. In a charity system, you ask for their help and they can give it to you or not. But you know how many people here would be voluntarily happy to I don't know to what are you raising your hand? You don't know what I'm going to ask. >> He's already supporting whatever you see this is the problem. would be happily donated to charity. >> No, I I wasn't going to say that because that's way too vague. I wouldn't raise my hand for that, right? I was going to make it much more specific. How many of you would be willing to help people who really really really cannot help themselves? You know, just voluntarily, you know, pay into a fund that gave money only to people who really really couldn't help themselves. Almost everybody, I don't know, there's some sociopaths here who won't who don't raise their hand, but almost everybody is willing to do that. So, what's the problem? Why do we need to put a gun to your back? And once we put a gun to your back, it's not about the people who really, really, really, really can't help themselves. Now, it's about the people who don't feel like going to work tomorrow. They get part of it as well. See, the nice the nice thing about a voluntary system is how many of you would give money to a fund that gave charity to people who don't feel like going to work? Nobody. So that well one. So that fund would be very small. That fund would be very small. So people would be you know they'd be encouraged to go to work even if their feelings it went against their feelings. So you see the market would sort it out. People who really really really needed help would get it. People who didn't really need help wouldn't get it. But in a democracy when we're voting for everything, it's much easier to lump them all in together and vote for all of them. And they, you know, you get pressure groups, right? Pressure group politics. And people are people are, you know, fighting over the crumbs of a government that spends 60% of GDP. There's a lot of money in government. So if there's a lot of money in government, what happens? We all start fighting on who gets it. We all start trying to get a piece of it because we want a piece of it. All right. How are we doing on time? All right. One last point. What do you What is it about capitalism that people really at the end of the day really hate? What is capitalism about? What did you >> greed? People don't like greed. What is greed? >> Yeah. What they really don't like is self-interest, right? Why do we not like self-interest? >> Everybody does have it, but we don't like it. like uh capitalism is all about self-interest. Capitalism is all about individuals pursuing their life, your life. Now, the self-interest means lying, cheating, stealing, and being a an Why not? Most people think it does because it turns out that lying, stealing, cheating is not good for you. It's actually harmful to your own life. I mean, if you don't believe me, try it, right? take your best friend and lie to them for a whole day and see what happens. Nothing good comes of it for you. So, it turns out lying, cheating, stealing are not good for you. And capitalism is all about self-interest. And yet, we associate self-interest with lying, stealing, cheating. We don't think self-interest is moral, ethical. Why not? What is morality? What have we been taught since we were that big? Is good. Help others. Think of yourself last. Sacrifice. Sacrifice is the best. Right? If only I could die to help other people, I'd become a saint, right? That is noble and good. I was brought up like that. I don't know about you guys in no way. But that's how I got. You know, helping others is the most important thing in life. Is it? Why is that? Why is helping others more important than helping myself? So we have a morality that says other people are what's really important. But even that is not quite right. Who helped more people? Who helped more people? Um do you know who Jeff Bezos is? >> Who helped more people? Well, put aside Jeff Bezos a second. You know who Bill Gates is? >> Yeah. But forget about Bill Gates of conspiracy theory. Bill Gates, right? I'm talking about Bill Gates 10, 20 years ago, right? The old Bill Gates before all the, you know, Jeff Free Epstein and whatever, all of that crap, right? Just focus on Bill Gates of a long time ago. He's a good example for a reason I'll give you in a minute, right? Bill Gates when he built Microsoft, did he make the lives of other people better? >> Yes. >> How many people? >> Many. The whole world. >> Pretty much the whole world. Why? How did he make their lives better? made it easier for >> when when I buy a product from Microsoft is my life better for buying it or not >> it's better otherwise I wouldn't buy it right when I go and buy something I'm trying to make my life better I'm being self-interested when I buy an iPhone for a thousand bucks am I better off or worse off >> I'm better off otherwise why would I buy the iPhone for a thousand bucks that is the iPhone is worth to me much much more than $1,000. That's why I'm willing to give it up then get the iPhone. And that's every time you trade, you're happily should be happily giving up the money because the money is less valuable than the thing you're getting. And if it's not, don't do the trade. So, Bill Gates really makes the world better. I mean, I believe that 8 billion people on planet Earth are all better off because of Bill Gates. Even people who've never touched a computer, like they get aid, foreign aid to Africa, food, like how do you think the supply chain works? The supply chain computers makes that supply chain more efficient. That's Bill Gates. So, Bill Gates made the world a better place. Now, you think the morality that says you should help other people says Bill Gates is a hero. Was Bill Gates a hero when he built Microsoft? according to the culture in which we live. I mean, I know you have lots of successful businessmen here in Norway, right? Not so much. Um, not so much. Are successful businessmen, even though they make the world a better place, are they heroes? >> No. Why? >> Because what? >> Yeah. Because they focus on themselves. Because they made a profit. So even though I make your life better, if I'm focused on myself, it doesn't count that I make your life better. So how do we make how did Bill Gates become a little bit better? Well, he he left Microsoft and he started a foundation and he started giving his money away. Now did he help the world more giving his money away than building Microsoft? >> No. Did Mother Teresa help the world more than Bill Gates? See, you can't even you can't even process that, right? Did Mother Teresa help more people in the world than Bill Gates? >> No, it's not even close. She maybe helped a few thousand people, you know, stay in poverty and not die, which is good. But Bill Gates helped 8 billion people. Microsoft is so much better for humanity than Mother Teresa. It's not even close. and he had Mother Teresa as a saint and Bill Gates as a villain until he starts a foundation, starts giving his money away. Then he's okay. He's okay because now he's not benefiting himself because he's giving the money away. But he's not a good guy yet. Why isn't he a good guy? >> Because he's still rich. Do you know that Bill Gates has in his house, he has a room, a whole room that's just a trampoline? Oi, that sounds like so much fun. Like you get a bounce. It's like a bouncy room in the house. Now, nobody with the trampoline room can ever be a good guy because he's having too much fun and he's thinking of himself too much. So, what would it take to make Bill Gates a saint? If we want Bill Gates to be a saint, what would he have to do? >> He'd have to give all his money up. He'd have to go live in a tent and he'd have to bleed a little bit for us. See, the morality that we believe in a culture is not about helping other people. If we believed in the culture truly that what's good is helping other people, we'd all be capitalists. Because humanity has never never seen anything like capitalism in terms of helping other people. But what we want is not helping other people. What we want is individuals to suffer. We want you not to benefit from helping other people. We want you to suffer. Sacrifice. Sacrifice is noble and good and virtuous and everything. Being self-interested benefiting from trading with other people and therefore helping them, that's evil. You cannot benefit. That is a morality that's incompatible with capitalism. The morality of sacrifice is incompatible with capitalism. And it's why capitalism is never sustained has a cannot be sustained because we do not want to see people get rich and be happy and be successful. We don't consider that virtuous and noble and good. We want to see them suffer. We want to see them sacrifice. We want to see them give up stuff. If you go and I don't know, volunteer in Africa, you're considered like a good guy. But if you actually build a business and change everybody's lives, eh, you're no good. I say the entrepreneur is the real hero of the world in which we live. The business person who builds a business and changes the world and trades with people is the noble guy, the moral guy. It doesn't have to be an entrepreneur, but I believe that taking care of yourself. Pursuing your own self-interest is what goodness really is. And if we each focused on pursuing our own self-interest, if we each made our own life our goal, our own happiness our goal under, you know, there has to be a morality of self-interest. There has to be a moral code that guides you in your life. That's the only moral system compatible with capitalism because that's what capitalism is about. Capitalism is about the pursuit of self-interest. It's about the pursuit of happiness. It's about the right to live your life based on your terms, based on your values, in pursuit of your life without sacrificing to other people. That's what capitalism is. That what produces the best outcome for human beings that we've ever seen in the world. So go be capitalists. Thank you.