Too Big Not to Fail: Imperial Governments from Moscow to Washington

0:00Yes, the greatest thing is pleasure to be here. It's wonderful to be here. I have a friend from Detroit and he said what's common between Detroit and Russia, it's a very good place to be from. It is really from the topic of our meeting today. I think it's fascinating. Banking. It's fascinating for me also because I would associate big government with socialism. Armin Alkan, a great economist from University of California in Los Angeles, amazing from that kind of place, a really great thinker emerged. He wrote a wonderful Intermediate Microeconomics textbook in which he claims and persuasively for students makes the point which Austrian economists knew all the time that government, Any government, even small government is socialist in its nature. So you can have a little bit of socialism or you can have a lot of socialism. You can have socialist government, say like in Soviet Union or in today's Cuba, or you can have a small government, a small government which still will be socialist, however, in the ocean of private property, private property

1:14and the market. And because of that, I think that the change is quantitative, quantitative. You can have a lot or a little bit of that. So that means that government should not, cannot be reformed, it cannot be run as business, it cannot become efficient, it should be just kept under control. And I remember my mentor and very dear friend, whose memory I cherish a lot, Murray Rothbard, at that time we talked about Ross Perot, you remember maybe Ross Perot, he was saying that we should open the hood of government and fix it. We should make government run as a business. And I remember Murray would say, I wonder if there is anything between these big ears. You cannot fix the government. You cannot. You should keep it small. You should keep it under control. And the bigger is the government, the worse it is for the people. I came from the country definitely, which was too big to fail, if you will lose Washingtonian today's

2:09jargon of the present government, that something is too big to fail. It was 11 time zones. It had all possible and impossible natural resources. And look what they did to that country. They murdered anywhere from 40 to 60 million people. The KGB chief admitted in 1988 on the Soviet television during something called Glasnost as part of Perestroika, Gorbachev's Perestroika. He was put on the spot and he was asked, we think 43 million people were murdered. Is that the right number? He said, I don't know right now, but in a week maybe we'll meet here again. And after a week, he said, yeah, the number is about right, but comrades, it's preposterous to think that all these people were murdered. Most of them died of natural causes.

2:54And the moderator, she was smart enough, she said, but on the premises of KGB. He said, yes, on our premises, people die everywhere. And he said, well, and she said, yeah, especially if you don't clothe them in Siberia, if you don't feed them, they usually tend to die. So why am I saying that? That the government, when the government is big, the governments usually run amok. They are killing their own people. I think Jeff today referred to Libya, to their dictator, Gaddafi, who is murdering his own people. The Soviet Union, other socialist countries, I refuse to use the word communist because there are many people, especially in academia would say communism was bad, communism was something that we were dismayed with.

3:44Socialism is good. However, if you will look at Karl Marx, at Karl Marx who came up with all these ideas. Socialism is the first stage. It's a necessary stage. His point was that communism would occur in four or five hundred years only with withering of the state. Can you imagine? It was kind of like a utopian dream that people would work for nothing.

4:34but during peacetime just to prove that this kind of theories work. For what reason they killed so much? Because there is no incentives. If you have a big, big government, then you don't have any incentives to work. No incentive how to force people to work. So instead of real incentives of the market, you have one incentive and that's fear, fear for yourself, for Your Family. Now, it's a very fascinating thing. I got a little grant to study archives in the Library of Congress by Soviet General Volkogonov. Dmitry Volkogonov was a top propaganda person for the Soviet government. He was commander of the Soviet Institute for Military History in Moscow and member of the Central Committee of the Party. So, anytime I would see him

5:55And then he approached the U.S. ambassador in Moscow saying that I want to move everything to the United States. Soviet Union unraveled. He became national security advisor to Yeltsin and he moved 46 U.S. ambassadors and said I will contact CIA and other agencies who would be interested in getting these materials. He said no CIA, no other agencies, Library of Congress. I want to put it there. And the other guys from CIA want to get the reader's card, go and read it. And now they have this treasure of 46 boxes. It's 160 rolls of film of the most top secret correspondence between Lenin and Stalin and Trotsky and Brezhnev and Andropov and Gorbachev. It was up to 1989, all these archives. And it's just amazing for me to see because a lot of this stuff is originals are back because KGB is back in power, so Putin put a lead, so you never can. This is the best and unknown in the United States.

7:08It's not classified even. You don't know what's on the roll, on this roll. And for example, there's a party secretary from the Southern Russia writing to Lenin, Dear Vladimir Dear Comrade Lenin, you sent us a memo that we should fight religion. How should we fight religion? Lenin on the same piece of paper handwriting. Dear Comrade imbecile, kill religious people, that's how. Lenin. And then a postscript. Postscript. And kill them the way that people will tremble 150 miles around. And so this is amazing. And in one of these, Lenin reveals, he understood the nature of socialism very well, much better than many of my colleagues academics.

7:55He understood that the only way to make it work is to kill people. And the more you kill, the more efficient that system would work. Work. He would say – in 1922, he was writing to Felix Dzerzhinsky, the first chief of KGB or Vechikai at that time. And he wrote, Dear Felix, I'm telling people what to do and they don't listen. And I'm thinking, what if we'll take a couple of these absent-minded comrades and shoot them publicly? Attention span would be better. And they did and it became better. And if you will look at, say, Soviet Union, the highest rates of economic growth at that The future, the logic of every system, when I'm being told, but look, our government, they're all such a bright people, wonderful people, so was first Soviet government. Trotsky Lenin was writing poetry in French. Lenin could play piano better than Condoleezza Rice.

9:07He knew he could speak seven languages. It's the logic of big government, the logic of socialism turned them into mass murderers. The same thing happened with Gaddafi. I was kind of blessed all the time with the most hot spots of history. I kind of really was was blessed by that. I saw the agony of the Soviet Union, the agony of the socialism there. And sure enough, last month I went to Tunis, Tunisia, on the 10th of January. And because I'm teaching at Carthage College, I decided to take a cab and go to Carthage, Tunisia, the real Carthage, which was supposed to be destroyed and was destroyed. So I took that and there was a lot of chanting and a lot of – I thought it's a football match.

9:58And so that's what we shout at Carthage about and it's a real one in Wisconsin. Well, Wisconsin now is another kind of I would say the war field of medicine. And so I went there to see and there was a lot of police, a lot of – I mean this was just amazing and police and you could see that from the hill and police were just like roaches trying to surround this ocean of people who were – some people would say they were I'm not fighting for freedom. They were fighting against high prices or whatever and the prices increased. Food prices increased 70% in Tunisia last year, mostly because now we are burning food in our vehicles. We are using corn for ethanol that rises prices all around the world and the poorest and the hungry, they suffer from that. That's opportunity cost in economics.

10:52It's also because people in India who embraced freedom and in China, which have more and more freedom, they are demanding better food, they are demanding higher quality food and so they demand for food. So in all these Arab countries, prices for food increased 70-90%. But also I think there were many of them, at least the people I talked to, many of them were looking for human freedom, for human freedom, for not to be interfered with. Something that was very moving for me was Jeff's presentation and Jeff's, especially, was kind of the, I would say the most, his thesis that you strip the government out of propaganda.

11:40You strip the government, you strip this king out of his clothes and you will see this naked Force, naked coercion, naked violence, abuse and rape of people, and I think we should do that with our government because we have so many propaganda in the United States funded by you. Thomas Jefferson wrote almost 200 years ago that it is the most abhorrable tyranny When you are forced to pay for the views that you dislike and this is just ridiculous. It's not even because of these views but what government has to do in brainwashing of people. We are paying to be brainwashed. We are paying our taxes to pay more taxes because that's what and NPR, that's what PBS, that's what government schools are doing to our minds.

12:45Think that we are losing cultural wars. Cultural wars, there was plenty, kind of a great body of socialist literature. That's what we should do with capitalism. We should at first poison their brains. We should deprive them of their ability to think because the goal is such Such a wonderful goal that we should sacrifice these choices in thinking. That's Antonio Gramsci, the Italian socialist in 1923-24. He was a great student. That's Hillary Clinton. She was praising him quite a lot. The idea is to win these wars by the left. Again, if If we return back to what is public good, why we should have government radio or government television? Rationale would be that private sector is a market failure, something called market failure in mainstream economics, this idiotic theory of market failure, that market fails to produce enough education for example or enough roads or enough space exploration And so we need the big government to step in and fix it and do that for us. However,

14:01I would say left propaganda, and that's what the public broadcasting is all about, is lavishly supplied by the private sector. Look at ABC, CNBC, MSNBC, all BCs are what doing. Yes. They are all turning out left-wing propaganda. And like we don't have enough, we have government and Propaganda, which is propaganda of big government. No matter who is in the White House, no matter who controls the Congress, what they're talking about only about the big and bigger and bigger and bigger government. I'm not saying that we should fund, say, conservative radius by the government. No, we shouldn't. It's not the content, but the whole absurdity, the whole absurdity that government should run any kind of propaganda Station, National Propaganda Radio, definitely PBS. I was on PBS a couple of times. And can you imagine, it was a pretty long time ago. Mr. Laird, he called me a third time and he said, well, conservatives want to give Russia $30 billion, was at that time discussing how

15:11to help. And liberals want to give $50 billion. And it sounds to me like it's very vague

15:48Spectrum, so that's what happened. Another thing is that leadership. I was asked recently to prepare kind of to be part of a leadership program in Capitol Hill Club, which is National Republican Club in Washington, DC, and to talk about different types of leadership, different types of leadership. And the organizer, even they were there and I was looking at the types of leadership and they have like like efficient leadership, functional leadership, democratically participatory leadership, and I was thinking, what is that? I mean, I haven't seen that at all. And then at the bottom of the list, they have in the leadership science or whatever it is, they have toxic leadership and narcissistic leadership. The last one, narcissistic, yeah. And these two I saw. These two I saw in Moscow and in Washington because I worked for Gorbachev's government as one of Economic Advisers, and I would put a disclaimer, I wasn't the advisor, I wouldn't take the blame for what happened over there. But then when I defected to the US, I began to work

16:55for the second largest bureaucracy of this planet for the federal government. So I saw enough of both toxic and narcissistic leadership in both places, yes. I would say the US fortunately will have more narcissistic than toxic yet. But it's kind of combinations. Look at the The previous, I think, was more narcissistic and less toxic. Now we have more toxic, less narcissistic. There is a famous quib by St. Francis that you have a two-party system. One party is stupid and another evil. But we can actually paraphrase it and say one party is narcissistic and another toxic. Usually toxic is in power, whatever it is.

17:42So this is, I think we need to learn this example. For me it's very sad to see how so many people, 172 million people, slaughtered by their governments during the 20th century and the only lesson of history is that it does not teach us anything. That means that, yes, just to remember these people and to remember them, I think that I used Cuba as a very good example. I would take my kids, my students, my students from my school to Cuba all the time because you just peek into that door and you will never be a socialist again. If you would see how that beautiful country with proud people to what kind of, how it was destroyed completely, how these people were abused and what not and it's just amazing. And then you see movies is like Michael Moore's sicko or other propaganda, which is worse than the worst communist propaganda.

18:45It's kind of more believable. They're showing hospitals which are attended only by the party elite, by the party elite, and they pretend that this is... And in Cuba, I have a friend from my Moscow ties because a lot of Cubans were indoctrinated in Moscow, were taken as Students and brought back to Cuba and I would invite him to talk to my to my class and one one young woman She said well, we see it's kind of disaster right around but we heard you have the best health care in the world He said yeah, we do you do he said we have a best health care We couldn't we can improve if we would have ambulances for example or medicines or occasional Clinics or dental care for the people then would be even better And then, when he finished, we were exiting the room already, two of us, and he in Russian, he said, come on, what a stupid. And I said, so why? She just was curious. He said, the only, in Russian, he told me, the only health care in Cuba is to swim to Miami right away.

19:52That was his major point. If anyone is interested, I have these pictures of health care that I got there. Just unbelievable, unbelievable. So this is definitely what we need to keep in mind. Then, for some reason, our government decided probably that it's bad for us to go to Cuba,

20:49Defect Right Away. That's what would happen. But what they did, they said, well, that you can only go to Cuba for a semester-long studies because the short term to the trip, but you are getting so frustrated and so depressed there if you are there for more than a week because to see human misery and you cannot help with anything, the country is completely, it's rampant prostitution. For what reason? I was kind of thinking, very easy, because people don't have anything else to sell. I would say that in Cuba, I became more and more convinced, and I am trying to write it kind of in a scientific way or in an acceptable way, that socialism in general, if you have a real socialism, then it degenerates into something called public slavery. Public and the public slaves, and that's why you can kill them in millions, because they're not yours even.

21:51It's kind of the same neglect as the government is doing to everything. If you look at public housing in the United States or public something else, and the same happened to people. Public slavery is the worst kind of slavery because then people are being murdered in millions. I'm not saying that private slavery is good, no, but that would be insane for a slave owner to kill his slaves, but for people like Lenin and Stalin and Hitler and Fidel Castro and Mao Zedong and Raul Castro, these are not theirs, they're just expendable. That's why Stalin used to say, death of one person is a great tragedy.

22:36Method of a Million is statistic, nothing else. And so that's how they treated, that's how they treated people. And I think that this kind of lesson we should learn. I see that this is my duty to talk about that. Maybe it will sound gruesome, especially I'm kind of the last obstacle between you and lunch and I'm afraid to sound like that. And it is really very important for us to have open eyes. So now I cannot take students to Cuba, but I found another, yeah, because for a semester long, I mean, this is ridiculous, absolutely, I mean, I will better spend a semester in Kenosha County Jail than in that island of freedom.

23:28It is really ridiculous. But there is another very good vaccine against socialism, that recently I would like to advise you to maybe to show it, especially if you have younger people you know who are still socialists. Hayek used to say that if you are 20 you are not a socialist, you don't have a heart. If you are 30 and still a social, you don't have brains. In that period, it's very important for people to get in touch with something. That's a documentary which was produced in former Soviet Republic of Latvia just a year ago called The Soviet Story.

24:18Even for me, who lived there for so long, who is studying it professionally, that was is a revelation of a lot of things, because they also had an access, because when Soviets were retreating from Baltic states, they ran away without picking up their archives and everything. So they looked into these archives and they found so many things, you wouldn't believe it. For example, Karl Marx, can you imagine that socialists in the Soviet Union prohibited access of the public to some writings of Karl Marx? Some writings of Karl Marx were highly classified. In 1848, Karl Marx owned and was the publisher and editor of Neue Reine Zeitung, a newspaper in Germany, in which in an editorial he wrote, whole Europe is littered with racial trash. And that would be Scottish islanders, Basques, Serbs, Poles and other Slavs. And we should get rid of them. They should be burned in revolutionary Holocaust, he used this word, Holocaust. For what reason? Because they are so backward that we cannot bring them to understanding socialism. They are two stages below, behind what the

25:33advanced nations of Europe are about. So we should discard them, discard them for the benefit of the future generations, for the benefit of the future generations. So he was the one who came first with this idea of genocide or this idea of ethnic cleansing, of ethnic cleansing of people. In other editorial he was absurdity of Poland, absurdity of Poland. Poland is a mistake, that's what he was writing. Poland should be discarded. And no, no, no, no, no, not like that. It's an amazing, I mean amazing video. It's great about it that those people who already made it from communist slavery or socialist slavery to freedom, say people in Poland, Lithuania, Latvia, Estonia, they are showing it in everybody in their high schools or universities. I've been shown this video.

26:31This is the best inoculation not to repeat the past, I think. It shows 7 million Ukrainians is Starved to Death. It shows such a horrendous crime. It shows first time in, I think, in the history, I didn't know about that, that there was a special department in the KGB which was experimenting with health in the medical field in Gulag and they're showing people with their skulls removed and you can see just kind of like sitting people still alive with kind of like first you think it's cauliflower in their hands. It's just their in Germany and everywhere else, they kind of put it in the right perspective. And people were condemned and sentenced for doing these kind of things. In today's Russia, these people are being praised. For me, as a Russian myself, it was amazing that in 2000, when there were still more or less free elections in Russia, that 73% of people voted a proud KGB colonel, Putin, into power. He doesn't have any repentance. He

27:51praises the Soviet Union. He was saying that was the most tragic event in human history, the dissolution of the Soviet Union. At that time, somebody asked me whether I travel much to Russia, and I don't because my last article published in Russian, there was a meat voted for a meat grinder. So Russia is one-sixth of the world territory, so I'm enjoying traveling in another five-sixth. But now I think we see the good signs that freedom is on the mind of many people because if you're trying so much to do something stupid all the time, And at certain point I think you see the light and more and more people in Russia are following the good example of their neighbors in Eastern Europe who already discovered what socialism is and how bad it is and now they are self-confident and they become richer and they are talking about the Crimes of Socialism openly, and this is extremely, extremely important.

29:04So I will stick around and if you have any questions during lunch and after that I would be delighted to talk to you and I will depart tomorrow only in the morning if you have any questions. Also, my email is everywhere on Von Mises material so please use that if you need any Any pictures of Cuba or any links to whatever is happening in Eastern Europe, it's wonderful. And also I would advise you to think about in your travels, to visit Eastern Europe, to visit Estonia for example, which is fantastic. It's such a beacon of freedom. On the Economic Freedom Index, which is compiled actually by Jim Gortney from University of Florida here in Tallahassee, and Estonia is number four, United States is number six in economic freedom.

30:02So you can see how former Soviet countries, former Soviet countries, they went fell swoop, they got rid of it and that makes people free and prosperous. And no oil, no gold, no diamonds are making people prosperous, only human freedom is the The Source of Prosperity