Walter Block vs. David Boileau

0:00And then I said, will you give me a pack for a hundred bucks? And now he says yes, and now I can get it. And this is voluntary interaction. And my claim is that this is the end-all and the be-all of political economy, proper political economy, proper ethics. The only way we should deal with each other is on a voluntary basis. The law of free association comes into play here. The law of free association says that the only people we should associate with are on a voluntary basis. I hate to sound like a parent, voluntary, voluntary, voluntary, but that's part of the deterrence. Not only should we deal with each other on a voluntary basis, but we should associate with each other also on a voluntary basis. No one should be forced to associate with anyone else. Now the most egregious form of association on an involuntary basis is slavery.

0:50The big problem with slavery was that you were forced to associate If you're a slave master on a coercive basis, you couldn't quit. How do unions stack up? How do unions stack up in this libertarian notion that all actions should be voluntary? Well, unions are the group that engages in a strike. And a strike equals a mass quit plus something else that I'll get into in a second. So, here's the scenario. A single person goes to the boss and says, hey boss, you're only paying me $6 an hour, I need $8 and the boss goes and you go take a hike. Second scenario. The worker comes into the boss and he says, I represent all 500 of your workers and unless you give us all the raise from $6 to $8 an hour, whatever the numbers are, we're all going to leave. We're going to engage in a mass quit.

1:50And my view is that if you have a right to do something, you have a right to threaten to do something. And since you have a right to quit, you have a right to threaten to quit. And if all unions did was that, they would be fine ethical organizations. But unions do one more thing, and the other thing that they do is in addition to engaging in a mass quit or the threat of a mass quit, When they do one other thing, which I regard as pretty nefarious and very incompatible with libertarianism, and that is they beat up scabs. They call nasty names, that is, strike breakers or competing workers. There are other workers that want these jobs too.

2:36And who are willing to work for the old six dollars an hour, to use my numerical example. And the Union beats them up. And in my view, beating up people for competing for jobs is not the only time you should be allowed to beat up people is when they engage in violence in the first place. So the use of violence and self-defense would be justified, but not if they just want to compete for your job. Now, immediately an objection arises, but don't the unions own those jobs? Isn't it equivalent, isn't what the scab is doing is equivalent to me grabbing this guy's backpack, stealing his backpack? Because the unions own the jobs, and if they own the jobs and the scabs are trying to steal the jobs, well then, what the union is doing with the scabs can be justified on self-defense.

3:29So this is a coherent argument. I reject this argument. I don't think that the union members own the jobs. I don't think that the employees own the jobs. I think rather that a job is a manifestation or an embodiment of a contract. And the contract is, hey Chuck, work for me, wash my car, I'll give you ten bucks and Chuck does that every day. And he doesn't own the job, rather it's an agreement. And the agreement can be broken at any time. In addition to beating up staffs, or rather what they do with staffs, they deal with their rights in two different ways. One, they beat them up physically, and I call that blue collar. The other is white collar.

4:14They get a law passed like the Wagner Act, which compels the employer to deal with the unionized worker whether he wants to or not, It's as if, to take an analogy, I divorce my wife, okay, freedom of association, I shouldn't be forced to associate with people I don't want to, but then what I do is I get a bunch of my friends to surround her house and anyone that she wants to date, we beat them up. Or we get a law passing that if she meets anyone else she goes to jail. Well, that's improper. That's a violation of the law of free association. There was one time I did some research to try to find out were there any unions that limited themselves to just mass quits and didn't engage in either beating up staffs, blue collar or white collar.

5:09And I came across this group called the Christian Labor Association of Canada. And I asked them, well, would you ever meet upstairs? Oh, no, no, no. We turn the other cheek. We're Christians, this, that, and the other. And I said, well, what about labor legislation in Canada? Do you think they were compelling the employer to deal with you? And they said, oh, yeah, sure. Well, they were struck off the list. I've never been a union that limits itself to what a libertarian would call legitimate tactics. Okay, that's the end of my comments under the heading of political economy. Now what I want to do is talk about economics a little bit. And the first point that I want to make under economics is that wages equal marginal revenue product.

6:00There was this wonderful cartoon about a year ago where I was the bowler and I was talking about my precious marginal revenue product. Well, I think that marginal revenue product is a very precious insight into what determines wages. Why are wages the way they are? Why does Shaquille O'Neal make a certain wage? Why do I make a certain wage? Why does the person who switches the floors around me make a different kind of a wage? It has to do with marginal revenue productivity. And the way you get to what marginal revenue productivity is, is marginal revenue productivity of the X worker equals total productivity of X plus one workers minus total productivity of X workers. To put this in numerical terms, suppose you have 500 workers and now you hire a 501st worker, namely he is the marginal worker, the 501st worker.

6:56And suppose that 500 workers produced $100,000 worth in a certain time period, and 500 award workers produced $100,000 and $15, well then we attribute $15 to the extra worker. We had 500 workers. We had a 501st worker. Our total receipts go up by $15 per hour. We attribute the extra productivity to the hiring of the 501st worker. So what will this guy's wage be? Well, there are only three possibilities. Either the wage can be higher than the marginal revenue product, or the wage is equal to the marginal revenue product, or the wage is less than the marginal revenue product?

7:47There are only three possibilities. Well, can the wage be greater than the marginal revenue product? Supposing the marginal revenue product is 15 and the wage is 20. Well, there are problems here. Because the employer is losing five bucks an hour for every hour that he hires the worker and he's going to go broke if he keeps doing this once too often. So, we have to rule out wages higher than the margin of revenue product. Well, how about lower? Suppose the margin of revenue product is, as we said, $15. And suppose that the wage starts out at $3. That's lower. Well, the problem with this is that the employer is now making $12 an hour pure profit off of this guy's work.

8:36And if we assume that this guy could work at any number of factories and be productive at $15, well, somebody else would come along and make a bid for the hire of this guy and offer him $3.01. Not that he wants to raise waivers, he wants to exploit workers like a good capitalist pig, but he figures, better that I exploit them at the tune of $12.99, The point is that there will be a bidding up process. Well, suppose the wage goes to $10 an hour. Well, still there's a pure profit of $5.

9:21So the wage will go higher and higher. It will tend toward $15. Okay, there are transactions costs. You might have to find workers. This is why if the employee comes to the bosses and says, I represent 500 workers in Golden League en masse, unless you give us a raise in wages, there is some sort of power to it because of these transactions costs. It will cost the employer something to hire 500 workers and train 500 new workers. He's got a staff that now functions well and they have to get all new people, it's a pain in the neck. Maybe he'll give them a couple of cents more, but You can't get a wage higher than the marginal revenue productivity. What determines marginal revenue productivity?

10:07How hard and how smart workers work? And how much and what quality of capital equipment they have to work with? Steam shovels will make you more productive than a stick and shovel. And what determines that in turn? Well, that's determined by savings and people investing in the country. What determines that? Well, pretty much economic freedom. The reason our workers do pretty well is the U.S. is a relatively free country. The reason people in Mexico don't do too well is they don't have a free society as much as we do, so there's not capital invested there. When the Mexicans are in Mexico, they make very low wages. When they come here, they make wages like anyone else, because they're cooperating with much more sophisticated and more quantity of capital.

10:53Okay, now there's an objection by my buddy, Boyd Wandel, who got into a breakfast with me in the marina, I guess he's not here even though I invited him, but what the heck, he's got some important things to do. He says, well, suppose there's mass unemployment, suppose there's mass unemployment, maybe the wage will stay at $3 an hour, because why should we raise the wage to anything higher, because there are unemployed people. Well, this is predicated on what's called the lump of labor balance. The lump of labor balance, he says, there's only so much work to be done. And if some people do more work, there'll be less of it for everyone else. And that's why we have it in mind, because some people hogging up the work.

11:40Well, I think that this is a problem. And we, to address this problem, we have to ask a very basic question. And the basic question is, well, why don't we have jobs in the first place? And the answer to that is the reason we have jobs in the first place is because we have scarcity. And what scarcity means, scarcity means is that what we want is greater than what we have. And as long as our wants are greater than what we have, then our wants are pretty much unlimited. Space travel, a few of the this, a few of the that, whatever, yachts and diamonds, whatever. That's where the jobs come from. And we can trust people who always want more than they have. It's the human nature. And by the way, if ever we don't, namely we all become aesthetics, well then there's no need for jobs.

12:30And there's no problem of unemployment or problem of wages. We all have enough of what we want. We don't have to work. So the problem goes away. So what then is the cause of unemployment? The cause of unemployment has got nothing to do with excess workers. For workers, it's got to be government artificially boosting up wages or unions boosting up wages above productivity level. That's what causes unemployment. Unions don't really raise wages. Wages are very high in computers, banking, insurance. Wages were rising. Oh boy, perfect timing. Just as I'm about to be booted off, so we'll take a break after I go for 30 seconds more. Wages are high in industries that don't have unions, in countries that don't have unions, like the five tigers in the Far East.

13:21Unions only started, if you count the Wobblies, as the start of unions in the late 19th century, and yet wages were rising before that. The AFL and the CIO didn't really get started until the 1920s, 1930s. The wages, I forget the exact date, but wages were rising long before that. Union representation was the highest in around 1950 at around 40 percent and since then union participation or the percentage of the labor force covered by unions has been much lower and yet wages keep going up. So it's hard to believe that unions are responsible for higher wages rather what they're responsible for is rust bills. When they raise wages above productivity levels and they back this up by violence and they bankrupt employers and then the employers have to go bankrupt and the jobs come down to the south with less than that.

14:15So that's my opening statement on unionism. And what I'm going to do now is not call on Father Dweller, if that would be possible, but let us get our first line for the pizza, and then everyone else line up, and after everyone's got pizza, they can call Father Dweller over. I'm coming at this from a completely different point of view. I'm not an economist, but at least sense of order. When we have labor school bodies being built, it will give us a talk on economics. I read an article once about what economists do when they do economics by Sanderson. I've always been interested in that article. But I'm coming after a good point of view. Years ago, years and years and years ago, there were three or four of us in graduate school in Belgium.

15:06Father Pettigrew and my other buddy here, I don't know if you remember his name. Anyways, we all did pieces on labor and discrimination and stuff like that. And he just recently wrote an article for the, Jim Byrne is his name, the Encyclopedia of Science and Technology. The problem in brief is how to accommodate the tendency, A, of employers to pursue the least costly means of production, how to make that possible, and for employees to seek the most evident thing in competition.

15:55I think that's where we are. That's kind of where we are, and how we're helping them do it. I just want to approach it from an ethical point of view. I've got a whole bunch of questions. The first is, why labor unions, we don't raise wages. Well, labor unions in America have done two things. One brought about safety, which is expensive. The ocean is an expensive proposition. Just take a look at Loyola. They changed all their bathrooms here a little while ago so they could have people come in and cripple people to go to the bathroom. We have a little bit on safety. I think there's some asbestos problems around. But mostly, they bring about safety, and they bring about retirement. Most people walk the streets out there on the streets of New Orleans, do not have their retirement taken care of.

16:43They're not taken care of. And their health is going to be taken care of. And they're going to be nine years old, broke. So retirement is a big thing. For example, my experience has been here at Loyola, running the labor school, and then I had a very unbelievable experience. I went from five years, 1985 to 1990, for five yearsivided as assistant to the president of the team system, which is from seven o'clock in the morning to seven o'clock at night, seven days a week. One day a week, we were all over the country doing 100,000 different things, which was fantastic, and you see, he one day asked me, he says, what do you think our biggest problem is? I said, I think your biggest problem is you haven't theoretically thought out what you're going to do. And there's two reprobates for what you're doing. And as a result, you make practical mistakes. I'll tell you, if you want to know what the practical mistakes are,

17:29or ask me why, I'll tell you what they are. Big, you make two big practical mistakes. We've got a small committee. So, here's a bunch of questions I would love to ask. Why labor unions? The only answer I know when you talk to them is to bring about effort. To make those two things we just had there a minute ago make that possible. How are we going to do that? To whom, the second question would be, I'm at Oxford now with my professor, Isaiah Belin, and we're going to the University of Marks now. To whom does that capital belong? Well, it belongs to the people who made it. In four years, it's going to be four years. Who the hell wants it? How do you spell out what it is that we do today?

18:16Well, it's positive law. If you want to see what positive law is, go over there in the law school and set in on this class on labor law. That Mass Labor Relations Act is very important. It was written very fast in the afternoon when we had it in the European Congress. We wrote it in the European Congress. There's holes all through the thing. Go over there and listen to one of those professors show you how to get around it, which large are supposed to do anyway. This is legal. That's illegal. You can't do this. You can't do this. They'll show you how to get around it. And then, the big problem I have with what Wally's saying is this, we're coming from two different points of view. Wally's coming from a point of view... Shall we do it? I'd really like to stop because I'm shy on supplies here. Wally's coming from a point of view of, it's an anthropological question.

19:08You got an idea of a man who isividic to his environment. He's a Cartesian. He's modern. Modern. We're not both modern. I say that idea of myself being explicit to my environment, whereas we want to get a person that is intrinsic to his environment. And the question is, how is it, here's the ethics question now, how is it that I fundamentally find myself in the world with other people? How is it that I find myself in the world with things? Well, let me show you. What would technology, what kind of technology will show you? How do we do things? We form our categories on things, and the world submits itself to us.

19:54The question was very sophisticated, what do you call the sophistication you've got here? The silver, and Walter was right a minute ago, we're hundreds of miles away from health. We haven't fully figured out what cancer is yet. We'll get to it. We'll get there. We haven't figured out what AIDS is. We'll get there. We haven't figured out what all these problems are. I've been telling Walter, all these problems that I had last year, they don't know what to do with pneumonia. Oh yeah, I didn't know what to do with it. I was laying in bed for a few days, but the world that you, look at the dental pattern in this room. Astonishing. Come on with me, take a break, I brought the born you on teaching in the seminary. What do you think the ethical, the dental pattern is born you with? Your teeth is all rotten.

20:39Okay, so the question is with things, we'll work it out, we'll work out things, we'll work out all this. The question is with people. How do I get along with people? If to be is to become. How do I become with people? In Bible, with the true people, that's the problem you've got. Our Jewish background gives us universal negatives. Never do certain things in the presence of people. Never. Lie. Never steal. Never kill. Never kill. Never do certain things. Universal negatives. If you don't want to do that, what did Joshua say when he brought us out of the desert? Don't go along with us. You're not one of us. Don't go along with us.

21:34Get the hell out of here. You don't want to do that. Once you do do that, you have made your life with the other person possible. This guy here is coming, his structure of consciousness is like this. His subject is more important than the object. This guy over here is just the opposite. The object is more important than the subject. You follow me? It's a form of idealism. This is realism. You're finished. This is passé now. This is modernity. It's passé. I was by a little 13 called Rerum Novarum, the new things, the new ones. It's passé. This now is beginning to come in, and our source of source is the Yeshiva.

22:21Our source of source, they're bringing us back to our Jewish origins, and all of a sudden we're seeing how it is going to be. You're all taking and making more decisions, not just at the university, right? You can get into it deeply now. This is fundamentally an ethical problem we've got here. Labor unions are involved in the fact that... Here I am, and it's 2007, And I got a wife and four kids, five of us. I have to have X number of dollars to have proper medicine, proper health, proper clothing. Look, we just got embarrassed. We just got embarrassed. The most important thing for me is to explore.

23:07How do you get to live with a $150,000 monthly rent? With no living money. And the poor, they're the poor people. Isn't that the solution?

23:22He doesn't go along with that. I don't go along with it. Good was a good one, right? How is that possible? When you're poor! You're poor! You've got to make it possible, is it possible, is it possible to Congress that this guy here can live in an area that's decent, what he calls decent living, proper medicine, proper housing, proper time, and at the same time, your capitalist can make a profit. You've got to make a profit now. It'll make a profit. You're going to go out of business. You're right. You'll be broke. You've got to make a profit. All we're doing by collecting and bargaining is raising taxes. I want to see the books. You better show me folks your paying income tax on that. Go ahead, any other kind of books? No, you're just being paid in serious trouble. I want to see the books. I want to know, can you pay me my wages?

24:08I know what it costs to raise a white and poor kid. So we need kids. Everybody should be raised that way. I don't know. Economically, is that even possible? If we're dumb economically, it's not going to be possible. If we don't know how to handle things, if we're dumb, it's not going to be possible. We've got to make that possible. We can't ask you to pay us money you haven't got. I just recently worked on the United Parsons Post of Contracting Teens, 90% of our guys are in the department, we've got to give them money, we've got to give them kids, oh, don't worry about that, let me take care of it.

25:06You guys, father, don't worry about a thing. We make more damn money than we know what to do with it. We'll pay you $27 an hour. We'll pay you $330 a week for compensation. And after 19 years, extra $1,500 a month because of a surplus labor cut. Do you notice my UPS guy running? Do you notice little Joey out there on that round truck running? He's driving a pickup truck, Wally. He's making $27 an hour. Why? Well, a lot of other people are focusing on different things they're not doing. So these three companies, Federal Express, EHL, UPS, Goldman, that's a company that really works and that keeps us going in the teams.

25:58About 20% of the teams here at UPS, 80% are working in the food processing out in California, which is always a problem. Now they got stuck with the bad, what was the word again? How am I ethical in relationship with the other by fully and totally respecting the other? How do I complete and totally respect the other? Depending on a different living wage. That means you've got to be able to pay a living wage. Now, if we can't be able to pay a living wage, then we've got a bigger problem. I don't know how you're going to solve it, Wally.

26:44It's an economics problem. It's a political problem. It's no longer a union problem. Unions, remember now, let me give you another caution, unions' mindset is made up of, there is that one female, that fellow is still living, it's a Christian, it comes from China, but I've just got to go and treat them for a second, oh boy, The CIO is a person who has been deep controlled in his work space.

27:34Here's the problem. Now all you do is put on heels. You put on the sole, you put on the tongue, you put on the laces. Everybody does that. So we're going to decontrol you, and we're going to make the shoes faster and better, for a cheaper price, and we'll get better. The problem is, the AFL-CIO is as old as he is, and you're stuck. Does anybody in this room know how to connect a house up to electricity without getting killed? Does anybody know how to do it? Do you know how to do it? You've been working with electricity? Yeah. If he was old as a river, there'd be no lights on in here. He can easily make you bark.

28:21The CIO guide is usually not very well educated in his phrase. Let me give you an example. 40,000 beds pre-Katrina. I don't know what the hell they got downtown. 40,000 beds that your wife and you and your mother used to get. Nice. 30,000 maids. I don't know what they got downtown now. I don't know what's down there now. We can't find a cook, a director, so that's all been decreased. All made minimum wage, $66 an hour, and you get a 94% occupancy rate. Someplace in the country, there is a monitor, he works for the sharing corporation, and he says, how the hell do you do it?

29:24The 95% occupancy rate, and you only pay a minimum wage to 30,000... Hell, is that America? How do you do it? Now, I don't know what's happened since. I imagine it's been crashing.

29:43They're saying, well, how do you do it? How do you organize 30,000 maids who are probably culturally illiterate, The AFL says we've got to take them along. For example, Teamsters are drivers, that's AFL, warehousemen, CIO, helpers, CIO. These guys here are being carried by us. That's an old problem to deal with. They haven't got skills, and they're riding on our coattails, and they're leeching on us, and they can't do the work.

30:33They don't know how to do the work. They don't know how to get those $30,000. They're afraid. They're afraid. They're afraid that somebody will take their job and tie it all in with respect to this thing. Those are the ethical problems that we found out. As regards to corruption, okay, what happened? How many of you saw the movie Once Upon a Time in America? Remember that movie about a bunch of Jewish hoods in New York, you know? They were in New York, you know? And down the block from them, they had a guy who had a union. They were kind of friendly with him. They didn't know what the hell he did or what he did. All of a sudden one day he came back and he was all beaten up. I tried to organize this place. What do you do? I have these people working for me, working through me, and they work there and they pay dues. They pay their money here.

31:27I think of them, beautiful friends. But, I love my booth right here. My protocols, the co-consul, the ego downtown, the group group, the people, that's the feeling. You're in an office, I'm watching the news, and if you put my phone on the payroll, I'll blow your brain out. I need the government to help us. The tincture is that once they're in it, right after, because we got the money. We made one mistake. We loaned them money to build the casinos in Las Vegas without proper assurance that they were going to pay it back. They paid back 320% interest. Roger, how about that? But, it's illegal. And so the government was after us, and the government investigated us, and found out it was illegal.

32:16The guys had to go home and quit and go out of the union. The government sent 150 million dollars of our money to investigate us and talk about it, and nobody posted it. If you can come over and directly investigate me, they might be dead. So, corruption, there was so damn much money, from 1934 to 1956, there was so much money around, money sticks. What we did, our ethics program was first of all, put out a legal program. Here's the law that you have to absolutely obey. You can't get money from them for nothing. Then, the second thing I'm going to try to do, I've got a little booklet there, Becoming a Virtuous Teamster, the role of a virtuous character in the life of a team, the only way to get that published is to get a copy of that.

33:03And the idea there is the whole idea of responsibility. I am working for Wally. I'm responsible to produce a product for him as quickly and as good as possible as possible. While he's working for me, while he's responsible for making that product, give me a living wage. Not only that, something else is happening now. You see that date last night on television to the Governor of Michigan, the guy running for the Governor of Michigan? Take your seat, please. Let me check the load. That'd be the end of Michigan, I don't know. I'm going to check the load. Please, please check the load. Now, if everybody in America would say, we're never going to buy a car until 1906, some of them would buy a General Motors car. That's probably a problem immediately. We're supposed to be a social justice institution. We had buses out here taking kids to Walmart.

33:54Buses! Loyola buses took kids to Walmart. Just as it was supposed to be, and it will be that way. It was built by a Chinese girl with a dollar and a half. You don't want that to happen to you. Wally will talk about that later. Anyways, responsibility. I've got to be responsible to my employer. The employer's got to be responsible to me. In a certain sense, I'm trying to figure it out. Does he have his responsibility? Do I have a right to have a job? I live in Michigan. Do I have a right to have a job? Does the industry have to stay here? I think it's comfortable. They can't give you money if you've got it. And I don't know economically, but I'm sure Walter's facts are nonsense, how many times those things have put people out of business, I don't know.

34:43King Street

35:02a little different pitch right okay that's definitely I come here representing a Jewish thug, and as a Jewish thug, I appreciate this, these diagrams, and I say that the proper way for us to relate to each other is to not beat each other upside down. The proper way for us to relate to each other is to not beat each other upside the head, unless it's in self-defense. The Virtuous Team series can be a very short book, because it's a contradiction in terms. These guys initiate violence against people who did not first initiate violence against them.

35:53They call them scams, they beat them up with either blue collar or white collar, it doesn't matter. The proper way for us to relate to each other is to keep our hands in our pockets and not beat up other people who are not doing anything violent. You don't own those drawings. The way Davey sees things is that wages come from the generosity of the employer. That's not true. That's not how wages come about. Not from the generosity of the employer, but from the productivity of the employee. If you want to raise wages, you've got to get employees to raise their productivity.

36:42They have to work harder or smarter or with more capital equipment. Because if you just raise the wages, because you can afford it, the people will leave those businesses and run away to the south and get away from the rest of them. That's what happened. That's what happened in West Virginia. That's what happened in Massachusetts all the way out to Illinois. You've got vast acreages of factories that are empty, that could have been filled with working people, but the unions raised wages under the threat of compulsion higher than productivity levels. Wages, total wages equals money wages plus working conditions, and under working conditions is safety, or air conditioning, or rugs, or whatever it is.

37:35So, the unions didn't raise safety. What they did is create unemployment for union workers. The only way to raise wages, and I'm now talking about total wages, which includes money wages and working conditions, including safety, is to raise productivity, not to demand wages higher than productivity, because in that direction only unemployment lies. David asks, well who owns the capital? He implies that the workers really own the capital. That's not true. The way this system works is that any worker can get up on his own legs and declare himself an employer. All he has to do is save a bit of money and hire someone. That's how Bill Gates did it.

38:26He started out in a basement or in his garage with another nerd. He hired another nerd and he became an employer. That's the way Ray Kroc did it. He bought one greasy spoon hamburger place and he expanded it because of certain abilities of entrepreneurship that he had. The capitalist gives the worker three things. First, the capitalist gives the worker risk. If I hire all you people to make these desks, it's going to take a while before these desks come out. All during this period of setting up the shop and buying the raw materials, I'm paying you a salary. When the first of these desks rolls off the assembly line and they don't sell, these people want pink and blue instead of gray, I can't come back to you and say, hey, all those wages I paid you, give it back.

39:16I'm bearing the risk. I'm the residual income claim. I also bear time for you, because for a whole year before the first of these come off the assembly line, you people are getting a wage. That's what the employer gives, and the third thing is entrepreneurship or leadership. Then he becomes the residual income payment, and he keeps the rest after he pays the agreed-upon fee. All right, we'll go into question and answers. Like I said before, we'll do a two minute for your question or comment directed at either individual. And then we'll alternate, starting with Mother Ball the first time and then Dr. Block the second time. We might have a chance at the question for a second. Well, later on, you know the question statement, but this is the question.

40:03If everyone takes their full two minutes, we will only have time for three questions. So if there's a way for you to express your question in less than your two minutes, we can hopefully squeeze more people in, because we're only getting new question answers for 20 people, if that makes sense. Alright, we'll start on the far right. I think the problem with the whole argument, educating the mass, people just seeing the ideas from the economy side, and from the other people's side, and the human side, and both will come together in understanding. The problem is that most of the employers knew, I mean most of the employees knew about what it takes to actually formulate a business and what not, they would understand how much knowledge you need, how much it should take.

40:58So I think that we can educate the mass and society of how different they are friends and how much it costs them to build more of an agreement between these two sides. Well, you know, I don't know how. Here's one of the problems we have, that I have right now, and it's being, 30 years ago, I could, the teachers were kind of agreed that their kids ought to go through high school. Kind of agreed, not completely. Now, they kind of agreed that kids ought to go to college, but not completely. Because they see a big outlay of money in there. They say, you know, if you're really going to be responsible for these kids, you better get them through college.

41:43And that's going to take, that's going to take hard work and money. And a good job, buddy. How do you, how do you educate them to the rest of the problem? If you notice now at Loyola, the minority kids are coming from the Teamsters to see if there is a new one for them. Professor Balo, the fine's respect is paying a living wage, this is part and parcel of his view, that wages have determined by the generosity of employers. I say that proper respect means not beating up scabs. I once asked him, does he justify beating up scabs? And he said, yes. I don't know if he was kidding with me, but it was right near the elevator. And he said, yes. They don't show, and I said, why? And he said, well, they don't show union solidarity. Well, I mean, then the mafia might be justified in beating up non-mafia people or the blood in the crypts beating up other people because they don't show crip or mafia solidarity.

43:00Solidarity. Unions are just a criminal gang when they go past a mass quit.

43:30How can we provide so much capital for every single person we have because we do consume 20 times more than your average low citizen expense?

44:00The major problem with the United Nations is that we're trying to figure out how to do it. I was just telling one of the interviews, President Clinton told me recently that on his drive, he and President Bush ran the money down their wildest imagination. So much so, that the Vice President of the United Nations says it's not possible, we did this 10 years in a row, to eliminate poverty. What he means is clean water, 5% of the public disposition is to waste the proper house. So you couldn't tell me you have no idea the money we ran into. You have no idea. The case is just out of nowhere. Tons and tons of money. And he says, old man Bush thought he knew my money.

44:50Liberals like to favor the underdog. In this case, they're favoring the overdog. The underdog are black people and Hispanic people and young people. Those are the scabs. The unions, I wouldn't say are 99% and 44-100 is white, but they're disproportionately white and the scabs are disproportionately black and Hispanic. I don't think that this is a support of the underdog. Now, I certainly appreciate the questioner's point about paying a living wage. We all are generous in our hearts. We all want people in Borneo to have good teeth. And the question is, well, how do you do it? And the way you do it is, first of all, get rid of unions. Because unions are like a viper on the body economic.

45:35What they do is they poison the economic sphere. If you got rid of unions and you got rid of a whole lot of other government interventions, We would then have capital flowing into Borneo if they were to do that. We would have more free enterprise. It's no accident that we're doing pretty well in this country and in other countries that have free enterprise. And the reason for it is you get more capital equipment and more savings and more investment. But when you have regulations and when you have people beating each other up and creating havoc and strikes and stuff like that, Then you don't have the capital investment and you get further and further away from the living wage. The living wage comes from productivity, not generosity of employers.

46:39Well, I agree with Professor Boileau's criticism of the teachers unions. I shouldn't have said that. I agree with criticism of the teachers unions. I think the teachers unions ought to be the standard, and I think that we should have private education. But I'm not so happy about the autoworkers. They now seem to be in the process of bankrupting Ford and General Motors. And it's the non-unionized places, like Toyota and Honda, that are less unionized, that will soon be taking over. The Rust Belt marches on.

47:21So there's just one to say that ignorance is bliss. Essentially unions come in and they basically educate the workers as to what their rights should and should not be. But at the same time they make the argument that minimum wage is sort of fitting as to what the worker should be receiving. So Father, I was wondering in terms of that, well we're going back to your example of in 2007, for a person's family and what their healthcare should be, why is it that unions aren't necessarily giving workers the necessary Is it necessary, or perhaps we can reference it in the thesis, but is it necessary that unions should be educating the workers as to what they can receive or the wages that are still bidding? Because the wages tend to vary from state to state, according to concept of living and according to what the bare minimums include, health care and food and things like that.

48:14So why is it that in terms of the union, especially in the mass media and the propaganda, they are constantly pointing towards the negativity or that these people should be making more, that they should be receiving better quality, and that they're not just making do with what they already have because they already have enough money to use? The answer to your question is for you to come with me, and the education departments of the unions operate with their money. And they'll lay out, this is where we are, this is where we want to be, this is what's now possible, I would say that unions educate workers in the same way that the mafia educates a new entrance to the mafia. They teach them criminal activities. They do. They beat up scabs. You're not supposed to beat up people, Dave.

49:07Everybody, before the week's over, go get Uno Muno on the revolt of the masses, and see why he says the masses use force, because they're not trained minds. If you haven't got trained minds, you're not going to have rational arguments. You're going to have violence. This is supposed to be my turn now. Yeah, I stole this guy's pack, so he should have a chance.

49:57Beating up those trying to unify, and recently it's even happening in North Carolina where the UFCW is trying to organize one of the plants over there. And so I understand your attack, you know, your premise saying that unions may beat up staff, but at the same time employing a ton of people to unify, and that's why it's so hard to organize. And then also, I'd like to know how you feel about a great today, a change to land, and how you feel about immigrants coming in, and how that will help the United States stay alive in a time where there's a quicker time. Just to be clear about our time, we're going to start with Dr. Block. Yeah, I was supposed to hold him in dark order.

50:43Yes, I think that employers hire... What are those groups called to beat up the union workers? Those. They have a special name for these things. Strike Breakers. Strike Breakers. I can't think of the name, but Strike Breakers. But the point is that if I punch you first, you're allowed to punch me back. Who started it? I say it's the unions. If the union said, all we're going to do is have a mass quit, but we're not going to interfere with you, Then any employer that beats them up would be acting improperly. But the union initiates the violence. The union says, we're not going to just limit ourselves to a mass quit. What we're going to do is we're going to down tools, we're going to walk off the shop, and then we're going to make sure that nobody else comes to work for you.

51:28And also we're going to bash in your equipment. So I think they're justified in using violence to stop these people who are initiating the violence. And if they said clearly, we're not going to try to keep scabs out of here, we're just going to stop working, we're all going to mass quit, then first of all, no employer would ever beat them up. They would just hire other people because there are other people more than willing and more than happy to take jobs at those inflated wages. They'd be willing to work for half the price, but they can't because of the union violence. So you're quite right, there is some employer fighting back, but they're justified because they're retaliating. It's the union that's initiating. It's all the difference between... I mean, if I'm punching you and you're punching me, to an outside observer it looks equal.

52:14But the key is, who started? Your thing about the immigration in the other countries... We have a thing called AFL, A-F-L-C-I-O for foreign people. Our problem is, all of our agents get shot.

52:36All kinds of money, the AFL-CIO for organization in Brazil. The question is, if you went up there and said, I got these three guys down there, three judges and scholars, the last thing you said, I want to do that, the AFL said, I'm not going to do that, I'm going to be dead in three months out of a bullet in the back of my head. We initiated putting bullets in the back of people's heads. That's how we've been doing it for a long time. We ran a thing here called the Institute, the South American Institute. You know my CIA contact tells me your agents are all dead. Because we have a few more questions, we're going to extend the question and answer by five minutes until time's up.

53:21If you use the thought of trying to take two things and create a new one, what does that mean to people like me? And what is that? What impact does that have on people?

53:51Inflation is a monetary phenomenon, that inflation depends pretty much only on how much the Fed pumps money into the economy. And therefore, if unions artificially raise wages, or if oil sheiks raise oil prices, other prices will come down. So I don't think this will have any inflationary effect. The main effect of unions boosting wages is to create unemployment, not to create higher prices. You'd think that the employer then who has to pay higher wages would then raise his prices, But that goes against the could-a, should-a rule. Namely, if he could have, if he should have, he already would have, would have, should have, could have, something, some rule like that. The point is that if he could have raised prices for his property, he already would have. Just because the unions are raising wages doesn't mean that he will be able to.

54:39Rather, the effect will be unemployment, not higher prices. I'm going to give you three little statements from the last poll. Three statements. I want you to write it down. I want you to think about it. Number one, time is more important than material. Number two, people are more important than things. Number three, labor is more important than capital. Time is more important than material. People are more important than things. Labor is more important than capital. Think about that.

55:30All right, I think also, just to get questions in, we'll go to 30 seconds for questions. How comfortable are you? Do you want to ask a little bit of what you've been saying? Like, you know, they beat up the staff and stuff like that. I think that you have to admit that they're, at least what you need to work about is they have to do some business. They push for safety standards, and I'm not going to devalue it. There has to be politics in there. One of the only reasons why I could come to this school is because my father was a mean worker and they were helping me with the scholars. I think that you both are kind of coming from two extremes, that there is some little ground that means you do some good, but you also do some bad, too.

56:17I mean, how can you say that the only thing is for being a staff member? Growing up, you know, my dad had been a funny one, he'd walk out some protests, and a lot of times when I got older, I realized that, you know, some of this was over some greed and such. If I say 2 plus 2 is 4 and you say 2 plus 2 is 6, it doesn't mean that the correct answer is 2 plus 2 is 5. Just because it's the moderate answer doesn't mean it's correct. Now you'll remember that I said that there was a white-collar way and a blue-collar way of beating up staff. Nowadays, they very rarely have to do it through collar. Every once in a while it seeps out.

57:03But usually it's white collar. Namely, the law forces the employer to deal with the union whether he wants to or not. So they are beating them up, but it's hidden through a white collar. The other thing is, in the back halls of the union, if we have to strike, that means a failure in negotiation. It's a failure. We prefer not to strike. Not to have picket lines. It's a failure. Like diplomats say, war is a failure. It's a failure of diplomacy. They're saying the same thing. They'll send me in, lots of times, Father, we've got to go see this company in North Carolina. What is it you want us to do? We don't want to strike? Okay, Father, you make a deal.

57:53So I know that both Dr. Block and Dr. Block are very, they take that thing seriously. The question that I have is not too much about wages and vacation, for instance, it's about public safety. If someone is producing a product that one knows the production process, there are health and safety issues. I know that you're coming to work for me, and by coming to work for me, there are real health and safety risks. Do I have some sort of ethical obligation to fix or make the working conditions as safe and healthy as I possibly can, or do I bear ethical responsibility when people are injured on the job?

58:40I think that capital and labor have done that magnificently in America. The OSHA laws are... There really is this expensive proposition out there. You better know what you're doing when you get in business. If you've got any kind of business in there that's hazardous, you better know that it's going to cost you a fortune. I think we're very successful in that. We've got some asbestos. There are some asbestos problems, but we don't quite know how to get our hands on them. Even the mines now are successful. I resist the notion that safety is something that the unions created. Safety is just part of total wages. It's just a different way of paying wages. One way I can pay you wages is an increase of $5 per week. Another way I can pay you wages is by making the mine shaft a little safer, what have you.

59:32I think to answer your question directly, as long as I'm not committing fraud, as long as I'm not lying about it, as long as I'm not saying that this cave mine is really safe, come work for me, I'm okay. I can say, look, it's very dangerous and I'm paying you a lot more money because I think that you would value the money more than the safety and other mines, if the workers really value the safety more than the money, the entrepreneur would find it in his best interest to do what the workers want. Well, okay, my closing statements are, I think we've got a number of problems. To whom does that capital belong? It belongs to the people that made it, both the capitalist and the employer.

1:00:19And we've got to produce a program that will make it possible that there will be a profit and that there will be a decent living wage. How to do that, of course, is to require lots of intelligence on everybody's part.

1:00:44And I'll do one thing, becoming a good team leader, there it is right there, 30,000 words, that's 10 years of work. I'll get you a copy of it towards the first of the year when they publish it. It'll be first in ethical journals in the world. There was a book written that taught a boy what to read. He asked, well, how can he do it? Adam Smith wrote this book in 1776. It kind of was an inquiry concerning the wealth of the nation. Why is it that certain nations grow rich and other nations stay mired in poverty? All he has to do is read that book. It gives a blueprint. It gives a plan as to how to do it, and to summarize it, it's roughly that government is best, which government is least. It doesn't say that government is best, which government is not of all, that's a different question, but which government is least.

1:01:34And which makes sure that individual people don't keep beating each other up. So he keeps saying, well, how do you do it? That's a problem, it takes great time, it takes great intelligence. Well, we already have the answer. Adam Smith provided it for us. It's relatively easy, at least it's not very miserable, government should restrict itself to upholding property rights and contracts. And when government goes above that by instituting OSHA, or demanding more safety than the private contractual rights are called for, well then, we don't have prosperity, we don't have people born with good teeth, We have poverty, and I am against poverty. As a Jewish truck, I say, yes, poverty is bad.

1:02:23We shouldn't have it. But people like Father Guadalupe are responsible for it. Because they promote government intervention. They promote unions. They promote OSHA. They promote all sorts of interferences with the free enterprise system. And when you come up, he advances with the pre-analyzed system, which is the last best hope for the poor. You hurt the poor. So he poses as a friend of the poor. He keeps saying that, yes, we have to help the poor. This is a problem. This is a crisis. How do we solve it? The answer is clear, and he's on the wrong side. He is the enemy of this. I don't believe that he needs this purposely. I know him very well. For five years I think he is filled with the milk of human kindness as anyone.

1:03:08But his economics is low. His economics is 180 degrees up. Some young lady in the narrow left asked about the minimum wage. And Father Boehm mentioned the minimum wage with the thought to these people who make the beds in the hotels. Yes, it sounds like a good idea. Let's raise the minimum wage. And the minimum wage is sort of like a floor under wages, and you keep raising it, and everyone's wage gets higher. Who could be against that, who is filled with the milk of the human crisis? But, if you believe, as I do, that the minimum wage law is not like a floor, and the higher it is, it gets the higher wages there, but rather it's more like an obstacle in which you have to jump in order to get a job in the first place, And the harder it is to get a job, if that's what you believe, and I think that that's true, well then, your view toward the minimum wage takes a 180 degree turn.

1:04:09Father Bolo says he favors unions on the basis of equity. Why is it equitable for a union member who's making $25 an hour to favor a minimum wage law which unemployed his low-skilled competitors? Why is it equitable to have a union, either blue collar or white collar, stamp down on the poor, stamp down on blacks, stamp down on minority members, stamp down on young people? That doesn't seem very equitable to me. He says, show me the books. I don't know, people shouldn't be forced to show anything. The libertarian axiom of non-aggression is, you just do whatever you want but you can't initiate violence against people.

1:04:59If somebody comes up to me and says, show me the books, I tell them to take a hike. What right does he have to see my books? Time is more important than material, people are more important than things, labor is more important than capital. These are all three economic fallacies. They are the same fallacies that prevented us from understanding or that created the diamond's water paradox. What's the diamond's water paradox? Diamond's water paradox is, why are diamonds worth so much and water worth so little, yet if we were to get rid of all diamonds, life would go on pretty much as it is, whereas if we get rid of all water, we'd have no life. Isn't that a paradox? The solution to the paradox is marginalism. We never get to pick between all the diamonds and all of water.

1:05:46We pick, just give me 15 seconds, we just pick a little bit of diamonds versus a little bit of water. Well, labor isn't more important than capital or capital than labor, because we never choose between all of labor and all of capital, or between all of people and all of things. We choose on a marginal basis, so these are economic balances. Well, we thank you for coming. We hope we take you mad and take you mad.