Bryan Caplan: Ugly Economic Truths
Economist and bestselling author Bryan Caplan is back on the podcast to debunk the conventional thinking on democracy, Keynesiansim, education, mental illness, and more.
Bryan asks and answers some of the most pressing questions of the day:
Should Jerome Powell support abolishing the minimum wage?
Does this dress make me look fat?
Can free market supporters be Keynesians?
Follow Bryan on Twitter @Bryan_Caplan
Connect with Keith Weiner and Monetary Metals on Twitter: @RealKeithWeiner @Monetary_Metals
Additional Resources
Garrett Jones – 10% Less Democracy
How to Win Friends and Influence People
Bryan Caplan’s Substack: Bet on It
Bryan’s AI illustration contest
The Yield Purchasing Power Paradigm
Gold Bonds to Avert Financial Armageddon
Podcast Chapters
[00:00:00]: In this episode…
[00:01:37]: Overview of Bryan Caplan’s latest book
[00:02:31]: Methodology of presenting contrarian viewpoints
[00:08:10]: Social desirability bias
[00:12:58]: Disgust for markets and Jeff Bezos
[00:15:04]: The case against education and fake vocational majors
[00:23:07]: Why we don’t learn about Mao and Stalin…
[00:28:27]: Public choice theory and market failure
[00:30:39]: Governments widen spreads
[00:46:26]: Mental Illness and Social Desirability Bias
[00:49:04]: Pragmatic Pacifism and the Historical Track Record of War
[00:50:56]: Totally Free Speech vs. Totally Free Markets
[00:53:40]: Most Impactful Works
[00:55:19]: Marx, Keynes, or Krugman
[00:56:11]: Alleviating Poverty
[00:57:52]: Flat tax or sales tax
[00:58:26]: Atlas Shrugged
[00:59:53]: Open borders for women or abolish labor regulations?
[01:01:07]: Future of behavioral economics
[01:02:50]: Question for future podcast guests
[01:03:14]: Where to find Bryan Caplan’s work
[01:04:23]: AI illustration contest
[01:04:46]: Bryan Caplan
[01:04:48]: Monetary Metals
Transcript:
Benjamin Nadelstein:
Welcome back to The Gold Exchange Podcast. My name is Benjamin Vern Nadelstein. I’m joined by the founder and CEO of Monetary Metals, Keith Weiner. Our special guest today, Bryan Caplan, Professor of Economics at George Mason University, and New York Times bestselling author of Open Borders, The Myth of the Rational Voter, Selfish Reasons to have more kids, and The Case Against Education, as well as a bunch of new essays and books, essay collections that you’ve been writing recently. So, Bryan, welcome back to the show. Your latest book argues that democracy’s main problem is not that voters are selfish, but that they’re actually altruistic with foolish views about how to help the world. So the book explores voter irrationality from inside voters’ heads and shows how much more sense democracy makes when you stop expecting people to make sense. So, Bryan, if voters are so bad, what’s the alternative? Our guest, Bryan Kaplan, makes the rational case today for freedom on today’s episode. Bryan, welcome back to the Gold Exchange Podcast.
Bryan Caplan:
Thanks so much for being here. Yes, the book is called Voters as Mad Scientists, essays on political rationality. Even if there were no alternative, I think it would be we’re saying this. We’re just saying, look, you’re dying of cancer. We got no cure, but I just thought you ought to know just so you can plan ahead, let us know what the prognosis is. I think there is a lot to be done. The easier things are limitations on democracy. We have lots of checks. We aren’t really fully democratic. You could just go and cheat and say, Well, Supreme Court is democratic, too. It’s like, Well, actually, it’s not. But maybe it makes things work better, and we can call it democracy anyway. I also am a big fan of just government doing less. Once you realize what a dysfunctional system is, you tend to lose a lot of enthusiasm for being democratic. My colleague, Garrett Jones, has a book called 10% Less Democracy. 10% Less is a good start, sure.
Benjamin Nadelstein:
So, Bryan, I want to ask you quickly about your methodology. From my understanding, the Bryan Caplan methodology appears to revolve around taking some unpopular truth and then presenting that in a more relatable manner to a layperson. First of all, how do you manage presenting these very contrarian viewpoints respectfully, but also backed with evidence? Where are you finding all these views?
Bryan Caplan:
Honestly, if you’re willing to go and say things that are unpopular, it’s not hard to find things that are true to say. When you just keep your eyes open, you’ll notice that there are a lot of obvious truisms in the world. It’s low hanging fruit. Other people don’t want to go and talk about it. So if you’re willing to talk about things that are unpopular here, then you can immediately get a big queue of things to discuss. Am I fat? Not polite to bring up, but it’s an interesting topic. How fat is, Bryan? Let’s discuss. What can I do to stop being so fat? And so on. That’s part of it. In terms of relatable, well, let’s see. There’s a lot of things that you can do. One of them is just to have a sense of humor about yourself. A very big part really is just being friendly to people. You can go and have a very amenable view, but if you present it in a robotic, hostile manner, then people still won’t want to listen to you. On the other hand, you could have an extraordinarily controversial position, but presented a good cheer and people are more likely to listen.
I’m a big fan of Dale Carnegie’s classic How to Win Friends and Influence People. There’s a lot of very common sense advice there on how to go and talk to other people. A lot of it just begins with everything true that they want to hear that you can concede, do it. You don’t have to go and just say, No, everything you think is wrong. Whenever I’m arguing with someone, I always do try to listen and say, What can I agree with here? Almost always there’s a bunch of things to agree with. If you are just honest with yourself, you don’t have to and nor should you just say every word out of your mouth is incorrect. Yeah, well, there’s a lot of things you’re saying are true. Marxist complaint about capitalism. He said, Yeah, well, living standards were really low in the 19th century compared to what we’re used to. You can see why someone looking back would think it’s really sad, and it was. But that doesn’t mean that these lunatics have any practical advice on how to improve things, but at least to go and grant that they’re not looking at things that are working perfectly or even well by modern standards.
That’s a good concession to make. In terms of other things you can do, I really like to just find thought experiments to get a little bit of distance. It’s a lot easier to see that some other society more remote in time and place is crazy than your own. Often I’ll just say, Well, look, we can all agree that that other side is crazy. We’re already on the same page there. Then the question is, could it be that the same flaws you see in your opponents might also appear to you in the mirror if you would really look closely and without denial, maybe?
Keith Weiner:
Dangerous ground. I was going to say speaking of those lunatics, I think they’re called TUC. Somebody said they’re.
Bryan Caplan:
Like a union- called what?
Keith Weiner:
Tuc here in the UK.
Bryan Caplan:
Tuc?
Keith Weiner:
Tuc. I think they’re a union of unions or something like that. They’re pushing now, calling for wealth tax.
So I was just on a different podcast a couple of hours ago when this topic came up, and I don’t really know a lot about UK politics, but saying that after Norway passed their wealth tax, tax revenues actually went down, which for those of us who are aware of even our laugh or let alone actual capitalist ideas would not be surprised by that. There’s a brain drain for one thing. It’s demotivating as hell for another when you.
Bryan Caplan:
Start sapping- They’re just mobile capital. Just get it out of the country, you have to pay taxes on it.
Keith Weiner:
And anybody who stays with their capital, they’re just draining it away and they have less and less of this dwindling. They’re producing less income, so down. To your point about people aren’t voting, quote-unquote, selfishly. They’re voting to render the rich, unrich. That is a feature, not a bug. And when you point out that, look, tax revenues went down, they don’t care. That’s only a pretext that we’re going to use this money to give free health care to the poor. The whole point of it is to make the rich not rich.
Bryan Caplan:
And obviously it’s very common to get very wealthy people who are totally on board with that. Bill Gates has been pushing higher taxes in the rich for a very long time, same with Warren Buffett. It’s not primarily a well-crafted plan to maximize the bottom line. It’s people participating in a irresponsible process where you can shoot your mouth off and whatever you say, the odds that you actually change the outcome are very slight. You can safely just express your deepest feelings. But at the same time, there’s no need to second-guess those deepest feelings, and that’s the part of politics, is there’s so littleself-doubt. So rarely is anyone saying, Yeah, well, this seems good, but what do I know, actually? I just imagine any politicians saying, And I further want to say, ‘What the hell do I know? ‘ Oh, whoops, no.
Every policy I tried last session was already leading to disaster, so let’s double-dip. What do they call it? A world without mirrors? Nobody’s reflective on, What did I just do?
Benjamin Nadelstein:
Can you quickly explain to the audience what social desirability bias is and how that affects politicians and maybe how it affects me and you.
Bryan Caplan:
Social desirability bias is the most underrated idea in all of psychology. It’s a very fancy phrase for a very simple idea. The idea is this: When the truth sounds bad, people lie. Often the lies become so ubiquitous that you stop even thinking of it as lies, and it’s just saying what everybody says. It goes back to things as simple as, Am I fat? Well, maybe I am, maybe I’m not, but there’s only one socially acceptable answer to Am I fat? Oh, Bryan, you look great. Oh, you’re doing well, you’re beautiful. Just the way you are don’t change a thing. You can see this in lots of different areas of life. You can see this in things like voter participation. When you compare actual data on voter participation to asking people, Did you vote? More people say they voted than did vote. You can see this for church attendance. More people say they went to church than actually did go to church. You can see this for things like, Are you ready to die for your country? I actually did a piece where we had this stereotype that after the Japanese attack, Pearl Harbor, that every able-bodied man in America got in a line to volunteer for the military.
I actually did crunch the numbers on that. It was just a few % of all eligible American men that volunteered to fight in the period, and most of them that did fight just got drafted. There was not actually a great desire among men to volunteer to get to the trenches to get revenge on the Japanese, at least not if it was their own necks that were going to be on the line or there’s one other one. This one is ugly, but in a way, it’s so ugly, it just drives the truth home. If you ask people hypothetically, would you have bought a down syndrome baby that only about a third of people say they would. But we have data on what really happens when people do have a down syndrome pregnancy, and guess what? It’s about 90 %.
Keith Weiner:
I was going to say there’s an anecdote that I use, which is why people vote for light rail. What they’re basically picturing in their mind is all these other bezzos that are blocking my way with all this bump and a bump of traffic. They’ll all be on the light rail, and therefore I’ll be able to drive where I want to go without traffic.
Bryan Caplan:
That’s really a self-interest story, and that’s just what I’m saying is not what’s going on. What I would predict actually is that people’s willingness to vote for the rail has very little to do with whether or not they’re going to use it or not. In fact, you could go and survey people in the middle of nowhere in Montana, where they’re never going to get light rail anyway, and just ask them, What do you think about light rail? You’ll see very high levels of support just because it sounds good. It’s not, again, a calculated plan to get anything other than a warm and a glow and a feeling of I’m a wonderful person and other people are going to like me. I say it’s not that people are like, Good, I can clear off the roads. If they really wanted to clear off the roads, what they would say is either build roads, that’s the obvious thing, or charge people for driving during peak times using electronic road pricing, which is totally technological feasible right now and exists in a few places but hardly anywhere compared to where it should because it doesn’t sound good to make people pay to drive when they need to drive the most.
Benjamin Nadelstein:
Yeah, Bryan, I’m thinking of some other examples as well. There’s modern monetary theory where they say, This whole scarcity thing, we don’t need to worry about that. If we just print a bunch of green pieces of paper and hand them out to everyone with a couple of accounting tricks, we’ll all be richer. I mean, is that not an example of something that’s just, Hey, listen, there is scarcity in this world. Not everyone can have everything we want, and doing a couple of accounting tricks doesn’t make people richer?
Bryan Caplan:
Yeah. Those people are one of the weirdest cults of kooks I know of. The fact they’ve managed to somehow get on the edge of academia is especially economics is embarrassing. Again, I think if you really are paying attention, what you realize is that they are not nearly as crazy as they sound. It’s really more of an effort to get really big government and a much lower role for the market through indirectly. Again, it’s one where you say, Well, won’t this cause inflation? No. Whatever it does, we’ll just pay taxes on the rich. Okay, so that’s what you’re planning on doing all along, and we just have to wait to get into the expected emergency if we listen to you before we start doing the other things that you say. In a way, it’s like how some far-left advocates for Obamacare were quite frank and saying, Yeah, well, this is going to destroy the private health insurance market if we push it. But good, we want it destroyed.
Keith Weiner:
We want everybody to be stuck in the same system, stuck in the same market and then we go to public schools. You could opt out if you have money, bothers them.
Bryan Caplan:
Yeah, of course. It doesn’t bother them that the schools don’t teach reading and writing properly, but it does bother them that someone might opt out. I think there is really just this great disgust for markets purely been not based upon anything they do, based rather upon… It just doesn’t sound good. It’s some rich people making money, selling products. They don’t care about the common good. All they want to do is run their businesses, sell stuff to people. If it seems like what’s so bad about that? If you’re in business, you might have gotten used to it. But these are not recent ideas, and they’re not unique to any culture. You can just read medieval writers in the Church talking about the horrible, miserable jerks that merchants were. The whole time it’s like, you want to see the really horrible people? How about the people living in the castle up on the mountain where they’re squeezing the peasants dry so they can live in luxury? But no, those people are okay. The people that we really hate are the merchants that are going and selling cinnamon to people. They’re actually the worst people in the world, not the mass murderers living up at the castle.
What’s really striking to me is how Jeff Bezos is much more widely hated by the Western left than the Saudi monarchy. By what possible measure is Bezos not a better human being than MBS, or acting king of Saudi Arabia. They may say, Well, if we can do something about Bezos, we can’t do anything about the Saudi monarch. I was like, That’s not why. You don’t like him because he got incredibly rich selling people stuff they like, whereas the Saudi monarch, they just inherited it. That bothers you less, even when they are the tyrannical rulers of a whole country rather than the innovative CEO of the greatest store that ever existed.
Benjamin Nadelstein:
Bryan, I want to ask you a couple of questions about schooling. You wrote a book called The Case Against Education. Let me fire back with some maybe immediate objections. Someone will say, Yeah, okay, I hear your complaint. Listen in school. Yeah, they’ll teach you just some random stuff nobody’s ever going to use. I mean, historians, there’s not that many historians. Athletes who are world-class athletes, okay, fine. Math teachers, okay, yeah, maybe not so much. But isn’t there a large % of schooling which is STEM, for example? So necessary training for an engineer. Well, you got to know how to do calculus and all this engineering stuff. Yeah, okay, maybe there’s some percentage that’s fluff, like theater classes and music classes, which most kids will never use. But I don’t know, at the end of the day, aren’t the percentages leaning more towards math and science and less towards music and theater?
Bryan Caplan:
Right. Yes and no. It’s true that there has been a substantial decline in the share of the liberal arts, so liberal arts BAS are definitely down, but there’s only been a very tiny rise in STEM. I think by the time that the book came out, all of engineering counting CS, was less than 5% of all BAs. What’s making up the difference? If STEM is barely anything and liberal arts are going down, what’s making up the difference? The answer is what I call the fake professional degrees or fake vocational majors. What? Like psychology. Like psychology? It sounds vocational. I’m training to be a psychologist. The problem is that every year we’re graduating more psych majors than we have jobs in psychology, which means that hardly any of them could ever possibly get those jobs. We have to keep adding on further credentials to ration it. Then even at the end of that, most of them are not ever going to be working as psychologists. That’s your communications, that’s another great one. It’s a hugely popular major. Might even be like 10 %, I’m trying to remember.
Benjamin Nadelstein:
You’re looking at a communication major, Bryan, so watch your language.
Bryan Caplan:
Yes. Right. So guess what? The total number of jobs in all of print, audio, visual, online media is less than the number of communications majors who graduate every year. Therefore, most of them could never possibly ever get a job in that field. It pertains like it’s vocational training, but it’s really just letting people spend some years on a pipe dream and then end up doing some other job that requires a degree in something or other. We can get like, Why is STEM so rare? Because they got standards that most people will never meet, clearly. I think that stuff is hard, and people that teach STEM are less willing to lower their standards to get people to pass. Obviously, all professors feel like they’re under some pressure to keep standards reasonable. But there are some fields like, say, communications where they just put the standards almost down to the ground and others where they probably met the standards a little bit, but nevertheless, they’ve got too much pride in their own discipline to do it. And therefore, the number of people in those fields stays quite low.
Keith Weiner:
Well, also, and speaking of somebody who major in CS and did a lot of engineering work, there’s a very objective black and white line, which is does your shit work or not?
Bryan Caplan:
Yeah. Although there’s always a way to lower standards. You could say, sure, we measure whether the program works, but it’s just a hello world program and we give you a BA for that.
Keith Weiner:
Right. You can lower the standard and the test or the degree, but then going into the.
Bryan Caplan:
Field- You might say that almost… Even in journalism, you say, Well, the standard is do we get eyeballs watching our show? So there’s always some final test unless it’s just a nonprofit tax-funded thing, in which case you can say there isn’t one. Notice a lot of STEM people actually work for the government, and maybe they have almost no standards at all and they can really basically do nothing. I’ve got a lot of grad students who work in for the federal government who tell me that there are multiple workers that only watch Netflix all day and do no work. I haven’t had people go and freak out at me because I’ll give a test and I’ll say the average is 50, and they’ll say 50 is a fail. I’m like, Well, 50 should be a fail if the questions are easy, but if the questions are hard, then 50 could be really good. Then there’s a famous test for math geniuses where the median score is zero. It doesn’t mean they’re bad at math. They’re awesome at math. It just means that the questions are so hard. Anytime you see a test result, you can always say it could reflect the difficulty of the test or could reflect the quality of the students, worth keeping in mind.
But yes, if you have no pride, then you can always get the pass rate up to whatever you want it to be. I think the real difference is STEM professors have pride that other fields do not have to nearly that degree.
Benjamin Nadelstein:
Bryan, question for you. What, in your opinion, is the reason that a lot of things that would seemingly be common knowledge or understanding taught in school, for example, Stalin and Mao’s regime killed more people than Hitler’s? Why are some of these things not taught in school? Do you think there’s actually a malicious intent, Hey, we don’t want to teach people about communism? Or do you think that there’s just incentives in public schools or government run schools that just don’t end up teaching kids stuff that they need to know?
Bryan Caplan:
Right. The first thing that’s going on is just sheer conformity. People do what other people are doing. People do what was done in the past. That is still, well, true, it’s circular because obviously the curriculum changed after Hitler, so why not this? I think that the immediate answer is most people that are designing the curriculum don’t know about this stuff. I grew up in the ’80s. The worst communist atrocity I ever heard about was shooting people with Benoît. I never heard about terror families or mass executions or anything else. Right now, then there’s this question, why don’t people hear about this stuff? There, I think you do have to go to the severe left-wing bias of the Western education system. People that are very left-wing, they just don’t want to teach stuff that makes their own side look bad. Now it’s true. Now, that’s not always the case. For example, a lot of the best early stuff we have on communist atrocities comes from other socialists whose buddies got murdered. When they start murdering your friends, this will often get people to stop being team players and say, Yeah, some people on my team killed some of my friends on my team, and they’re not really on my team.
But when time passes, then that goes down. Or even there, it’s like, But don’t think the team is bad. It’s just a temporary aberration of just most of the people that are into this.
Benjamin Nadelstein:
And Bryan, can you tell us a little bit? I saw on your website you have a Museum of Communism page. What’s on there? What do you think are some of the facts that people are missing and what can people learn on that page?
Bryan Caplan:
A great question. That’s something I started about 25 years ago, and I did maybe one-fifeenth of the project. Then honestly, I moved on with the rest of my career. I just have a hobby of studying the history of communism. The body count is through the roof, as you alluded to. There’s the standard thing of just actual executions. Most of the deaths in our communism come from agricultural collectivization, where the communist government says we’re going to take all the farmers’ land. Then guess what? It turns out farmers don’t want to give their land. Normal governments would say, Oh, in that case, well, we don’t want to go and murder a million people and starve our countries just for this principle of no one should have private property. But actual communist regimes have generally said we would rather kill a lot of people and starve our countries for a while than give in on this principle. That’s the big story for mass death in the Soviet Union, communist China, and so many other countries. Just like when you take farmers’ land from them, this leads to an immediate crash in agricultural productivity for a season or two, which means that you’re starving to death.
Then once the government takes it over, things recover somewhat from the chaos, but they still leave those countries at least on the edge of starvation and very vulnerable to other famine. There are people who say yes, all true, but that shouldn’t count as murder. Yeah, I think that it should. In the law, we do have the standard where if someone opens up a door in building, throws in a handgunade without seeing whether anyone’s inside and then runs away. If they kill anyone, we call that murder. The law calls that depraved, indifferent. The person says, Well, how can you accuse me of murder? I didn’t even know for sure anyone was in the room. It’s like, You should have checked. You should have checked. The fact that you didn’t check means that we are going to treat this as if it’s murder, which seems totally reasonable to me. In the case of Mao, he had some especially wacko ideas about how to grow food. He believed in something called deep planting, which meant that, well, during the Chinese Civil War, we found that the more difficult our circumstances were, the more heroically we strove to overcome them.
Right? Right, oh, great one. We would not then follow that if we planted seeds six feet down on the earth that they would struggle to get to the surface and would be greater seeds and greater plants than they were otherwise. Yes, of course. Oh, great one. Well, try it out and let’s do an experiment. You try out Chairman Mau’s idea and experiment. It doesn’t work at all. It doesn’t grow anything. Then you come back to him and he says, So how did my great idea work out? Yeah, it was a incredible success. Then that case to do it to the whole country. That’s basically the story of the Great League Forward. Mass starvation, like 30-100 million people. Hard to know how many, but it’s the worst famine in history, worst mass murder in history. There are still apologists from now saying, Well, he couldn’t know everyone lied to him. It’s like if you murder people for giving you bad… For telling you that your ideas aren’t working, it is 100% on you when your ideas lead to people dying. This is just like throwing a missile into a room without checking whether people are there.
Now as to what the full story is, there’s so much going on. Probably another really big misconception about communism is the idea that they were great in industrializing their countries despite the human cost. I say, look, industrialization isn’t even the right word. The right word for what these countries did is militarization. They are not doing what a normal developing country does, which is increase their productive capacity so that more people can have a higher living standard. Rather, what they’re doing is starving their people, shrinking agriculture in order to go and prematurely start building up militarily vital industries so they can have incredible armies. When Hitler invaded the Soviet Union, Stalin had on paper the greatest army that the world had ever seen. He had done a number of things to hurt quality, like execute 96% of his officer corp. But in terms of number of tanks, number of planes, number of soldiers, number of guns, he had done something amazing, but it was not industrialization in the normal sense that we see in the West where rising agricultural productivity allows a shift of farm workers and industry, leading to a sustained rise in consumer living standards.
Rather, it’s more just like turning an entire country into a slave labor army for military purposes.
Keith Weiner:
Part of his great leap want everybody to melt all the… Or maybe he wanted something else, but everybody melted down all the plows and all the farm tools. Then, of course, they couldn’t farm after that, but then they have a lot of iron, I guess, to make something else out of it.
Bryan Caplan:
Yeah. Another piece of mouse insanity is basically every major commune is given a quota for how much steel they have to produce. They don’t have the technology to make steel, so all they do is just grab a bunch of iron and melt it and then put it in a big ball and say, There’s our steel quota. Can we live? And then you’re fine, but then you don’t have the actual primitive tools that you need that were keeping you alive before you go from having stuff that is bad to having nothing at all, which is worse.
Benjamin Nadelstein:
Yeah. I remember two things. One, in Stalin’s regime, I remember he had killed so many of the elite or senior officer core that the average age at one of the congresses was in the ’30s or high 20s, which is insane.
Bryan Caplan:
Totally, totally legal. That was a big part of Stalin’s plan is that he wanted to massacre everyone who remembered what had really happened during the Russian Civil War and then replace them with young people who know nothing other than the lies that he told them.
Benjamin Nadelstein:
Bryan, I want to jump to what we’re discussing here in general, which I would call public choice theory. I want to bring up two things, and I’ll have you maybe define them, and then I’ll have Keith jump in. What is public choice theory? First of all. Then maybe after you define that, what is a market failure and how does it relate to public choice theory?
Bryan Caplan:
Public choice theory is one of many names for the economics of politics. There’s a long list of names, so sometimes called political economy or formal political theory, positive political economy. Again, you could just call it economics of politics. What distinguishes public choice with other names is just flavor. Public choice is economics of politics that is closely associated with my current home state of Virginia, very closely associated with the names of James McCannan and Gordon Tullak, Robert Tollison, Ronald Coes as well. Basically, these are all economists that were teaching in or around Virginia in the ’50s and ’60s, and then they were pioneers here. Now, there’s a lot of other people working this too. What’s notable about Public Choice, this variant or this flavor, is it’s more clearly anti-government and critical government. But again, all of it really comes down to just because government, if it were run honestly and rationally, could improve upon market performance, doesn’t mean that it actually will. For that, we need to go and look at what governments do in the real world. Market failure, quick version of it is it’s any time that markets score less than 100 % on a scorecard of how well a market could possibly do.
Bryan Caplan:
A view that Public Choice rose up against was the view that any time markets get less than 100 % score on the test, that’s a good reason for government to go and fix it. People in public choice were saying, Well, why don’t we see what government fixes look like in the real world? Maybe it only approves markets from 70% to 72% on the test, but at an enormous cost, maybe it actually makes things worse. That’s another possibility.
Benjamin Nadelstein:
Keith, I want to send it your way because you wrote in your dissertation about bid-ask-spreads and how widening-spreads or tightening-spreads can mean different things for coordination, coordination making us all richer, and how things like price-fixing schemes or minimum wages, how those actually don’t help people, but they actually hurt spreads, and how the government will say, Oh, listen, people aren’t getting paid enough, therefore minimum wage. How might that affect the market?
Keith Weiner:
Yeah, so I try to take a rigorous approach to this idea of what can the market do. And sometimes in a sarcastic moment, I would say market failure is when the market doesn’t deliver in the style of Ambrose, Birce, The Devil’s Dictionary, which I’m a big fan of. The market doesn’t deliver the outcome that I want at the price that I demand. That’s a market failure. So people think, okay, the government can improve the outcome. I wasn’t trying to look at incentives. I was trying to look at the ability of people to coordinate. And I said, spreads in the market and particularly bid-ask spread, but also, let’s say, location spread. I use the example of the price of eggs in a farm town 50 miles outside of a city center. If the price of the egg in the farm town is a penny and the price of the egg in the city center is a dollar, why is the spread so wide? And I looked at a dozen or so policies that governments do all the time always with the promise to improve outcomes and showed that it forces the spread to wider, which means that people are actually being forced to discordinate or lose the ability to coordinate.
Keith Weiner:
This wasn’t an incentives problem. This was the nature of government policy. I’ve can’t. It’s like there’s a mosquito buzzing on your forehead. And the only tool that I have is a sledgehammer. I can’t possibly help you by swinging that sledgehammer at the mosquito in front of your forehead. Only bad things could happen. I mean, the best cases I could miss, but then worse if I should kill the mosquito. And so that was a key part of my dissertation was to look at spreads that way. And then obviously the incentives are perverse, too. You cannot assume that everybody working in the government has this altruistic idea that, yeah, we’re in this solely to make sure that the poor get better education and better health care. Everyone’s gaining it for a variety of incentives, which are generally not well understood by the public, getting back to your idea of democracy, the poor people don’t get it. These incentives are not widely understood and often very perverse. So we have a system that people can gain. Why do we have a system that people can gain? Wouldn’t it be better not to have that in the first place, less government, et cetera?
Benjamin Nadelstein:
And there’s a David Friedmann discussion where he’s talking about markets and government, and he’s saying, A lot of times when I’m discussing with people, there’s something called the Nirvana Fallacy, which is, Hey, okay, in your scenario, the market is doing X, Y, Z, and then all of a sudden, there’s this issue. There’s something that’s not exactly perfect. All right, then we have this perfect government come in and they completely fix it. Okay, so don’t you think we should have a government? But then his point is, Well, isn’t that a bit of an unfair scenario? Because putting the word perfect and then imperfect in front of anything automatically biases the point. You could have perfect markets where everything works perfectly and then an imperfect government comes along and messes everything up. Shouldn’t we have no government? It’s a fallacy. Ryan, why do you think that people fall for this either fallacy or systemic bias of thinking, Hey, anytime something goes wrong with the market, we need the government. But anytime something goes wrong with the government, Oh, that’s just a coincidence. We’ll vote in better people next time.
Bryan Caplan:
Well, you asked me about social desirability bias. That’s my big story. This is a general rule of life. There’s somebody that you already don’t like and something goes wrong, then it’s like, Hey, that person is terrible. There’s somebody that you do like who makes a mistake, and it’s like, Well, you have to understand that they were coping with a really tough situation. Markets do not sound good to people. People do not like the sound of rich people doing things and being successful. They don’t like the sound of business doing things and being successful. When a system based upon people who are rich and businesses are going and producing things has any problem at all, people are very quick to say, This is terrible, just as I thought. Again, often the problem is not even defined as anything other than the motivation. Just think about all the protesters with sign saying greed on them. Greed. It’s like, Yeah, what do you think businesses are doing it for? They’re doing it to make money. You’re using the negative term there, but how is that show anything? It shows enough. It shows that they are despicable, as Daffie Duck would say.
On the other hand, for government, people have a very different view of it. No matter how badly it actually does, it’s still, it’s us. These are our leaders. These are elected by the people. Even if it happens to be temporarily in the wrong hands, still, it is the embodiment of our nationhood, and so people are just very forgiving of government. So Frederic Bourdiat, the 19th century French economist, he is the story that a lot of my friends like, which is, Well, people don’t like markets because so many of the benefits of markets are unseen, so many of the costs of government are unseen. Here I say, Well, this is true for almost everything complicated, but still in the case of markets, people don’t give markets the benefit of the doubt. If you just say, Hey, well, there’s a lot of complicated stuff going on. Say, Oh, well, that case, no. But in theon the other hand, in the case of government, if you say, Well, it’s really complicated. He’s like, Well, yeah, I can only imagine how complicated it is. We think about when government fights a war, it seems to be a total disaster, but they say, Well, you have no idea how bad it would have been if we hadn’t fought the war.
The result that you see that you think is bad, that’s fantastic compared to what could have happened, and people will believe that crap. Whereas if you see markets doing something and it seems like it’s not even ideal to say, Look, they’re doing the best they could in a tough situation. It’s like, Oh, sure, they are. You, as your apologist for those greedy jerks. Yeah.
Benjamin Nadelstein:
I know Bob Murphy had an interesting episode about Keynesian economics and saying, Hey, listen, pump priming and stimulus spending. There’s not even any empirical evidence that the Keynesians can cite and say, Hey, listen, this was a great success for our model of, listen, the economy was going downhill. We pumped in a bunch of money and things just went great. He points to this saying no matter what scenario happens, because economics in some ways is a social science where it’s hard to actually do empirical testing, you can’t say, Well, let’s just run back to the 1920s. Time marches on. We said when Janet Yellen and her husband, I forget his name actually. Ecclesh. Ecclesh, okay. They were saying, Hey, listen, if the economy starts tanking in 2008, here are our projections. Here’s how low we think the economy can go. This is what will happen if we do absolutely nothing, if the government doesn’t intervene. It’s going to look like this. Now, if we intervene, there’s a chance that we can actually save it and the economy will take a long. What did we do? We printed a bunch of money. Not only did the actual line of how bad they thought the economy would get would go lower than just the neutral spot that they had predicted, but it went worse than even the no nothing scenario, the hands-off scenario.
And so most people would say, Well, oh, my gosh, clearly this whole money, spending, printing, borrowing, that clearly didn’t work because the economy was worse than even in your prediction of doing nothing. What was their response? Oh, our models must have been off. The economy must have been even worse than we thought. So it seems like there is no way to disprove, Hey, more government borrowing, more government spending. I know, Keith, you write about this a lot. The government’s borrowing capabilities are, of course, expanded by the Fed. It seems like there are no people who say, Wait a minute, shouldn’t we just try the other way? Try a free market? Try less spending, less borrowing, austerity, budget cuts?
Keith Weiner:
Certainly not in the area of money. Most people that are for free markets and other things really can’t get their head around the idea of a free market and money and credit and banking and currency. It’s that one area that almost everybody agrees needs to be centrally planned. And then the debate is whether it’s the Milton Friedmann K % rule, whether it’s a certain rise in consumer prices, whether it’s managed to hit unemployment or now the latest cult, I guess, is nominal GDP targeting. But these geniuses can’t figure out the right rate of inflation is, but they can figure out what the right GDP growth is. And if we just only centrally plan to that, then that’ll be fine.
Benjamin Nadelstein:
Yeah, Bryan, I want to send it your way. I know the Fed in some ways has a dual mandate. Hey, you’ve got employment, you’ve got an inflation and all these things. I remember reading one of your things. You said, Hey, listen, Keynesians, they should be the biggest ones against a minimum wage because that is really bad when it comes to sticky prices. If the whole Keynesian idea is, Hey, people hate taking wage cuts, shouldn’t Keynesians be against a minimum wage? Shouldn’t Jerome Powell, the Fed, shouldn’t those guys be against a minimum wage? Hey, let’s fix the unemployment problem in one go, we’ll just abolish the minimum wage. What do you think? I wouldn’t.
Bryan Caplan:
Be shocked if Jerome Powell actually does favor abolishing the wage. But just to back up, what I’ll say is I am actually fairly soft on Keynesianism as an idea. I think that it’s grossly misinterpreted and for political purposes. I do think there is a solid core of it that, first of all, is in no way anti-free market, but also I think the evidence is reasonably good in its favor, not perfect experimental evidence, but still. In terms of should Keynesians be opposed to the minimum wage? Yeah, of course. They’ve got a whole theory predicated on the reason why we need to have government keep up demand is because we have downwardly rigid prices and wages. This is the whole way the model works, is to say, Well, if we have demand falls and prices and wages don’t fall, then there’s going to be falls in output and employment, and that’s all make sense. But then once you say that, the obvious implication would be, We never don’t want to do anything that would increase that rigidity because anything we do increases that rigidity will make the consequences of falling demand worse than they otherwise would be.
There are a few fairly desperate efforts to go and avoid this conclusion, but mostly it’s just double think and they don’t want to deal with it. But yeah, then more generally, Keynesians should be strongly opposed to any effort to push up wages or any labor market regulation. What Roosevelt did during the Great Depression was encourage a massive rounded unionization. According to any model they’ve ever heard of this is insane, but he did it anyway and remained their hero because in practice, Keynesianism gets twisted to just become a rationalization for left-wing policies, but there’s really no logical reason for that. Just in terms of the really most basic textbook, Keynesian model, anything you can do with increased government spending could be done with tax cuts. Anything you could do with raising taxes can also be solved with spending cuts. It’s purely an ideological coincidence that Keynesianism is associated with raising government spending and raising taxes rather than lowering government spending and lowering taxes. Again, Keynes himself, of course, was quite left wing. Ii mean, it’s not just random that people think of it as a left-wing theory. There is a reason for it. But if you just go to the actual core of the literal statements of the positions, it’s quite different from what people imagine.
I’ve been thinking for years about writing a paper called Free Market Kainesianism, just explaining all of the ways in which the ideas of the core ideas, like the thinnest part, like the basic foundational, purely academic claims are, first of all, true. Second of all ones, the free market people should have no trouble accepting. But so far, it hasn’t gotten written.
Benjamin Nadelstein:
Ryan, you will have absolutely two readers and Keith and myself. I think that’d be a fun one. Maybe Bob Murphy will read it as well. In our remaining.
Bryan Caplan:
Time- Yeah, Bob will kill me for it. Hi, Bob.
Benjamin Nadelstein:
Hi, Bob. In our remaining time, I want to run through just a bunch of different ideas, a hodgepodge, a collection of your different thoughts because you write about pretty much everything. You’ve got a substack called Bed on it, posted by the Salem Center. I’m just going to run through a bunch of these. You can take as long or as little as you want. And, Keith, I want you to jump in whenever you feel. First, Bryan, you noted on your blog, you said other disciplines regard insanity as a puzzle to be explained. The economic way of thinking inclines me to wonder what the puzzle is. So, Bryan, maybe can you explain how you think about insanity, mental illness? I know a lot of people struggle with this stuff today. What is an economic way of thinking about insanity?
Bryan Caplan:
Let’s take a really easy one, and then we can do harder ones if you want. Alcoholism would be classified by the DSM, the Standard Psychiatric Diagnostic Manual, as the mental illness of substance abuse disorder. But then it’s like, Well, so what is the disorder? Basically, it’s just in drinking a lot, even though it really bothers your friends and family and messes up your career. Now, as an economist, you’d say, Well, it couldn’t almost anything mess up your relationship with your friends and family and mess up your career. What if you’re totally into being a rock musician? What about that? And you’re not good. You just go down and say, Yeah, it seems like almost anything could be like this. Really, this is the disease of caring about a beverage more than things you’re supposed to care about. Now, when you put it that way, it’s like that doesn’t seem like something that you should go to a doctor to diagnose. That sounds more like something for a philosophy class or an ethics class. It’s not really the thing where a person can say, Oh, well, you have a disease. With cancer, you’re going to die of it, whatever you do.
Whereas with this, it’s like just stop drinking and then the problem goes away. I’ve heard people say, Oh, they just can’t. Well, that’s an interesting claim. How about we put them in a circumstance where the consequences of drinking are extraordinarily bad and see whether it’s really true that they can’t. I say, Look, if you say that somebody can’t, then increasing their centers shouldn’t change their behavior. If you say, I can’t stop having cancer and I’ll say, I will kill you unless you stop having cancer. Guess what? You’re going to have to kill me. But if you say, I will kill you unless you stop drinking, that’s actually highly effective, which shows there is a really big difference. Anyway, in the other… Sorry?
Keith Weiner:
Have you conducted that experiment?
Bryan Caplan:
George, can you explain? In my paper, The Economics of Mental Illness, I go over a lot of bodies of experimental evidence showing that what people think of as mental illness is actually responsible to incentives, not just alcohol consumption, hard drug consumption, but even things like hallucinations and delusions. When people are given awards or punishments for going and going along with them, you see that the quantity that people do goes down. Again, it’s tempting to say, Well, they’re just pretending they’re just keeping their mouth shut. But at least there are a lot of delusions where if you really were totally sincere, you would have no reason to keep your mouth shut. For example, John the Nobel Prize winning mathematician, while he won the prize for economics. Anyway, so if you’ve seen the movie, Beautiful Mind, he’s diagnosed paranoid, schizophrenia. If you read his biography, one of his main delusions is just being an omnipotent being. Yet this omnipotent being would vary his behavior and mental health suppose, depending upon whether it was his wife or sister was in charge. His wife was more sympathetic, his sister was less so. When it was sister, then he would go, Oh, gee.
The omnipotent being had better shut up and stop causing trouble. When it was wife, the omnipotent being can open up his mouth and cause a lot of trouble. It’s like, Hmm. If you were totally sincere on being this omnipotent being, you would just say, Snap your fingers. My sister now loves everything I do. But guess what? That’s not what he did. So a lot of this actually ties in with social desirability bias because it’s so much nicer to say they can’t help it, it’s not their fault, than to say they can help it, and it is their fault. It’s an empirical question as to which way it goes, but we can see, well, do they respond to incentives? Again, the point is not to go and torture people to get them to change. The point is to learn what’s really going on. It’s a question of philosophy of mind. Is it really true that alcoholics cannot change? I say, It’ll be a lot of evidence as they totally can. They just choose not to. Now, why we have all this psychiatric language? I say, Again, social desirability bias makes perfect sense. What happens to an alcoholic who says, I drink, I can totally stop, but I choose not to because I care about my favorite beverage more than my family.
Well, your family is probably going to cut you off real quick. On the other hand, if you do the classic, I want to change. I really will. I love you more than anything. That person will probably eventually run out of forgiveness, but they can run it out a lot longer. And on the flip side, when you want to go and treat people against their will, it sounds a lot better to say the person is helpless and sick than to say, They are impossible to deal with, and I can’t stand them, and I’m going to crush them, which would be the honest thing to say. It’s called the economics of SAAS, S-Z-A-S-E, preferences, constraints, and mental illness. Thomas SAAS was the psychiatry professor most noted for pushing these ideas. Probably his best book is Insanity: The idea and its consequences. He also did fantastic books of aphorisms. I’d say actually, the books of aphorisms are probably even better than his other stuff. I guess there’s this one aphorism where he says, If you don’t like the shows on TV, you don’t call TV Repair Men to go and make the shows better. Similarly, if you don’t like a person’s behavior, don’t call a psychiatrist to make their behavior better.
Benjamin Nadelstein:
Okay, right.
Bryan Caplan:
What are you getting at? I look, the problem isn’t that it doesn’t work. The problem is it’s being used in a way that you don’t like. A very different problem.
Benjamin Nadelstein:
Okay, Bryan, next one. Pragmatic pacifism. I’ve heard of pacifism. I’ve heard of pragmatism. What is pragmatic pacifism? Yes.
Bryan Caplan:
Yeah, pragmatic pacifism is pacifism based not on saying it’s always wrong to kill anyone or you’re always wrong to go and fight a war, but rather saying that when we look at the historical track record, the record of war is very poor, and in particular, while some do work out, on average, they don’t. Human beings are very poor at predicting in advance which ones will work out well and which ones will work out poorly. There’s the political psychologist Phil Tetlock, who has a book called Expert Political Judgment: How Good is it? How can we know? This was one where he did an actual tournament where he asked a whole lot of political experts to predict the future. Then he waited for the passage of time to reveal what in fact happened, and then he went in and looked at their accuracy and found out their accuracy was low. It comes down to people support wars with great confidence, but what do they really know? Sometimes they’re not always wrong, but that doesn’t mean that they actually really have the ability to break the future. This is where I say, Look, modern war always involves either murdering or at least negligently killing large numbers of people.
We don’t have really good evidence that it actually improves the net outcome on average, and therefore the right thing to do is to avoid fighting wars. That’s the story. Again, I know each of those premises needs to be argued for further. I’m really happy to do that if you’re curious, but yeah, that’s my story.
Benjamin Nadelstein:
Okay, Bryan, I want to end our talk here with some rapid-fire questions. I’ll start with you. I’ll end with, Keith, each time, but just give as long or as little as you want. These are topics of different areas. Okay, let’s start. Ryan, would you rather have totally free speech or totally free markets?
Bryan Caplan:
Yeah, totally free markets, of course.
Benjamin Nadelstein:
Keith, I’ll send it your way. I think it’s an easy one.
Keith Weiner:
My challenge is I don’t see how, especially you say totally, I don’t see how you can have one without the other. I’m allowed to trade something, but I’m not allowed to talk about what I’m trading. I’m allowed to talk, but not trade. The idea of what we can have liberty compartmentalized in just this one area and totalitarian command and control over here is a contradiction in terms.
Bryan Caplan:
The way I hear the question is you’ve got two dials. We have the free speech dial and we’ve got the free markets dial. Which one you turn up to as high as possible? I’d say our free speech dial is already pretty high, so we don’t get that much marginal gain from turning it up to total, whereas our free market dial is a lot lower. We just get a much bigger marginal gain.
Keith Weiner:
From total. I can offer one interesting anecdote, which is there’s an awful lot of people moving to Dubai, which certainly does not have freedom of speech. There are certain things you just do not open your mouth and say if you want to be in Dubai. And yet the tax rate is zero, business regulation is a lot lighter, although in some cases it’s surprising at what the regulation actually is and what they make you do. But a lot of people are moving there to make their money. But I think that a lot of people want to be there for a few years, make their money and come home. It’s like people who go and join a fishing boat in Alaska for the summers or fishing cannery. They make a lot of money in a short period of time, but they don’t want to stay in it and want to then come home. And so that draw to be able to make money, especially if you’re European, where A, you don’t pay taxes on whatever you make offshore, and B, you’re essentially suppressed. You’re under the government’s sun with all the crushing regulation and energy restrictions and everything else.
You’ve got to do well. You make a lot of money, but then they’d rather retire to France or Italy with a lot more fun and drink the wine, drink the beer, and your money is offshore.
Benjamin Nadelstein:
Okay, next rapid fire question. So, Byan, if you were to have all of your work erased, except for five articles or ideas, which five would you choose?
Bryan Caplan:
Ideas is easier, but then I could just say the main idea of each piece. I mean, if you’re saying which of my books has actually done the most good in the world? Then it’s almost certainly, My Selfish Reasons Have More Kids. There are hundreds of people who have had extra kids because of that book. So that’s the book that I’ve had that’s actually changed a lot of people’s lives and created a lot of value. In terms of the most persuasive book I’ve ever done, and I’ll say it’s Open Borders, in terms of intellectually the most impressive one, I think it’s The Case of Concentration. So that’s what I’ll give you.
Benjamin Nadelstein:
Okay, Keith, I’ll send you your way. All of your work is getting erased. You get five articles or five ideas. Which do you choose to keep?
Keith Weiner:
I think the anti-concepts and money, my dissertation, I think yield purchasing power, I think permanent gold backwardation and how to use gold bonds to avert Armageddon.
Benjamin Nadelstein:
Okay. All of those will be in the link of the description. Thanks, Keith. Okay, Bryan, next one. Where do you think you can make the most impact and are you doing it? I call this the Robin Hanson question. Bryan, I’m sending it your way.
Bryan Caplan:
In terms of the most impact, just based upon past experiences, getting people to have more kids, I have done this. I could do more. I guess the main thing for me is usually I work on a topic, I say what I have to say that I think other people aren’t saying, and then I’m done and I want to move on. My hope is always other people go and do the day-to-day maintenance, which sometimes they do, but that’s where I’m coming from.
Benjamin Nadelstein:
Okay, Keith, I’ll send it your way. What do you think is the most important topic you could be working on and are you working on it?
Keith Weiner:
I think that’s an unfair question because I’m trying to change the monitoring system and the logo behind you over your shoulder is the company that’s trying to do it. I don’t want to plug it too much here.
Benjamin Nadelstein:
Okay, you can find us at monetary-metals.com to join the movement. Okay, Bryan Caplan, next question for you. We have a central planning Czar. Who would you rather it be? Karl Marx, John Maynard Keynes, or Paul Krugman?
Bryan Caplan:
I’m going to say Paul Krugman. I wish I could get Paul Krugman from the 90s, but I’ll still say Paul is better than Caines and definitely both Lightyears is better than Marx. Kaines and Krugman, I would put close, although Krugman just knows a lot more based upon a lot more experience and is a more logical thinker than I was. Marx is just a terrible dogmatic fool. Smart, but a fool.
Benjamin Nadelstein:
Okay, CEO, Keith Weiner. We have a planning Czar. It’s not you. It’s going to either be Karl Marx, John Maynard Keynes or Paul Krugman. Who do you pick?
Keith Weiner:
I feel like asking me, what disease would I prefer? Congestive heart failure, advanced renal failure, or cancer? I don’t know, roll the dice.
Benjamin Nadelstein:
Okay, Bryan Kaplan, what is the best way to alleviate poverty and why aren’t we doing that?
Bryan Caplan:
The best way, I would say, is what’s doable without we’re or anyone else involved, and that is bourgeois virtue. I’m a big fan of this work on the success sequence for the US. It just comes down to in the US, if you just finish high school work full-time and get married before having kids, then your odds of being poverty are like 2 or 3%. This is advice that is good all around the world. No matter how messed up a country is, it is a good idea to be disciplined, hardworking, obstemious, and and have a good self-control. This is something that can be done immediately without needing anything else to change. In terms of what policy could go and do the most to alleviate poverty, then it’s definitely open borders. We know for a fact, if you just go and move people from poor countries, move to rich countries, their income multiplies 5-10 times overnight, but that’s not something that one person can do on their own.
Benjamin Nadelstein:
Keith, to send it your way, what are some ways people can alleviate poverty and why aren’t we doing that?
Keith Weiner:
Well, from a policy perspective, get the government out of the way. It’s interfering in every possible way from restricting businesses, restricting energy consumption, minimum wage, taxes. It’s that professional licensure, et cetera, et cetera. Just start repealing some of that crap. Individually, I agree. I mean, educate yourself, especially in your field. Work hard, be disciplined, save, accumulate, don’t borrow, especially don’t borrow for consumer purposes, all the standard stuff.
Benjamin Nadelstein:
Okay, Bryan, back to you. Would you rather have a flat tax on everyone or a sales tax on everything?
Bryan Caplan:
Logically, they’re actually equivalent, so I’d say I’m indifferent. It just depends upon the rate. But the only difference is in terms of ease of tax, avoidance, and enforcement. I guess I would say that the flat tax on everyone is easier to avoid that, so I would go with that just because of the greater ease of tax evasion.
Benjamin Nadelstein:
Okay. CEO Keith Weiner, your way. Flat tax on everyone or sales tax on everything?
Keith Weiner:
You’re saying everything, meaning every consumer good or meaning all the producer goes all the way up and down the-.
Benjamin Nadelstein:
All of it, baby.
Keith Weiner:
-then probably a flat tax on everyone because it’s not going to impact production as much.
Benjamin Nadelstein:
Okay, Bryan, I’m sending it your way. If you could be one character from the book Atlas Shrugged, who would you be?
Bryan Caplan:
Well, let’s see. Shag. I mean, Ragnar Danneskjöld is the coolest character, a pirate who’s going on the high seas. I wouldn’t actually be him because I’m terrified of almost any physical danger. I’m really more of a Hugh Axton, a philosophy professor hanging out in the valley while everybody else gets the job done, and I say, Yes, you guys are all very good.
Benjamin Nadelstein:
Okay, Keith, your one character from Atlas Shrugged. Who would you be?
Keith Weiner:
I think my career has been more parallel to Hank Reardon. Here I am refusing the idea that society is hopeless and it’s beyond saving, trying to create new things and fighting the world to some degree to get them accepted.
Benjamin Nadelstein:
Bryan, I send it your way. Would you rather have global open borders for only women or abolish all labor regulations?
Bryan Caplan:
I assume you have to mean excluding the abolition of immigration restrictions. Yeah, so then open borders only for women. Not only is that half the world’s population, but on top of that, we’ve got something else going on, which is once that happens, then I think it’s going to be really hard to go and keep us away from full open borders. But I think that as bad as labor market regulation is, immigration regulation is 95% of the badness of labor regulation, so we just get so much more bang for the buck.
Benjamin Nadelstein:
Okay, Keith, your way. Open borders for only women or abolish all labor regulations?
Keith Weiner:
I think if it was open borders for all versus abolish labor regulations, I might have a different opinion. But given that it’s only for women, and a lot of women are going to stay to be with their men, I think that probably wouldn’t accomplish nearly as much as it might seem. And so I’d say abolish labor regulation.
Benjamin Nadelstein:
Okay, Bryan, back to you. Do you think behavioral economics will be more influential or less influential in the next 10 years than it is right now?
Bryan Caplan:
Probably a little bit more influential. It’s still on the rise. It’s definitely slowed down a lot. There was a period from 1980, 2000, where they were marching in with great self-satisfaction and saying, We totally changed this whole area. It’s been gotten a lot less interesting. We do it to a large degree, I think, because they’re not listening to me. I’m a behavioral economist. I’m the one saying, Look, how about we go and apply this to government too? Then we’ll see that so much of what you thought came out of behavioral economics is actually the opposite. I think there is a lot of left-wing bias in behavioral economics that makes them unsympathetic to that approach. But if they really want labor economics to thrive, then they will go and turn their steely gaze upon democracy itself.
Benjamin Nadelstein:
I love it. Everyone, if you’re a behavioral economics major listening, you got to read more of Ryan Kaplan. Okay, Keith, to you, behavioral economics, do you think it’s going to be more or less influential in the next 10 years?
Keith Weiner:
Definitely outside my swim lane, but I think I’m probably with Bryan that either it’s not going to change that much or maybe increment just slightly, but there’s so much institutional inertia for what we have now, and particularly around what we’re talking about, what people say that sounds good, people want altruism, the idea of sacrifice and the idea that someone’s getting rich, it’s bad. And is that going to change any time soon? Probably not.
Benjamin Nadelstein:
Okay, Bryan, I’ve got a second and last question here. What is a question I should ask everyone else who comes onto the Gold Exchange Podcast?
Bryan Caplan:
Really good question. Very meta. At least one really good one would be, What’s the secret to human happiness? Explain it to me.
Benjamin Nadelstein:
Okay, Bryan, we’re going to have to wait until you come back to hear your answer to that question. So, Bryan, where can people find out more about your work, buy your new books, and find your writings, and your AI drawing contest, which I think ends in five days?
Bryan Caplan:
Yeah. Okay. I’ve got my website, which is just bcaplan.com. I’ve got my Substack, which is Bet on It. Then all my books can be purchased on Amazon. So the latest one, Voters to Mad Scientists, that’s only $12 Amazon, $9.99 for the e-book. I have not raised any of my prices despite high inflation, what was high inflation. There’s three other books in that essay series as well as all my other ones. Then finally, yes, I am doing an AI illustration contest on Freelancer. Com. Basically, about 15 years ago, I wrote a superhero story of literary quality. I have high standards as a writer. I really believe in having original stories that say something different from what anyone else has done. I’ve been trying to get illustrated for a while. What I’m doing right now is a contest where people are able to go and do any combination of human art and AI and just seeing whether I can get something better than I’ve gotten the past. My great friend, Steve Khuen, owner of Major League Pickleball said, Hey, Bryan, I’m really curious about how good AI artists. Can I give you some money to run a contest?
Bryan Caplan:
I’m like, Yes, Steve. Absolutely. Thank you, Steve. That’s what’s going on there. Normally, those the great stuff comes in just the last couple of days before the contest ends. I’m waiting to see what happens. I’m optimistic, but we’ll have to see.
Benjamin Nadelstein:
Bryan, I want to thank you so much for coming on the Gold Exchange podcast, and we’ll see you soon.
Bryan Caplan:
All right, fantastic. Always a pleasure to be here. Great to see you guys. Talk to you later.
Benjamin Nadelstein:
Thanks.
Bryan Caplan:
Bryan. Thanks, Bryan. Bye.
Additional Resources for Earning Interest in Gold
If you’d like to learn more about how to earn interest on gold with Monetary Metals, check out the following resources:
In this paper, we look at how conventional gold holdings stack up to Monetary Metals Investments, which offer a Yield on Gold, Paid in Gold®. We compare retail coins, vault storage, the popular ETF – GLD, and mining stocks against Monetary Metals’ True Gold Leases.
The Case for Gold Yield in Investment Portfolios
Adding gold to a diversified portfolio of assets reduces volatility and increases returns. But how much and what about the ongoing costs? What changes when gold pays a yield? This paper answers those questions using data going back to 1972.
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