A Libertarian Gallop Through American History

0:00Ladies and gentlemen, thanks for being here. Unfortunately, Mark has now ruined things for me because he's given money away to people. I'm standing up here going, well, you know, I've got a couple of bucks in here, but I don't have any real rationale for giving it out. Kind of a shame. Yes, it's true that I had a New York Times bestseller a couple of years ago. By some interesting happenstance, it just so happens that I have a copy right up here. sort of fell into my hands so you might have noticed it in the bookstore it's the politically incorrect guide to American history and if there's one thing more satisfying than having a New York Times bestseller it's having a New York Times bestseller that the New York Times hates you know so that every week they have to put this thing on the list it's driving them crazy so that was that was particularly satisfying and it was and it was free publicity because also in

0:57In addition to putting on the list the New York Times specifically on their editorial page denounced me and the book as being very dangerous because I was puncturing a lot of the conventional wisdom and of course my sales zoomed after they did that. People thought, well obviously we have to buy this instantly. So, you know, that was wonderful. So I actually have another American history book coming out in the spring and I suspect the Times will ignore it altogether. You know, fair enough. You know, why give me free publicity? Well, I'm very glad, particularly, that you folks are homeschooling families. I myself, I was telling some of you at lunch, I'm the father of three young girls. The oldest is three. Oh, my goodness, even homeschooling families are murmuring.

1:42How can you do this? For a while we had three under three. My goodness gracious. Yeah, that's right. A few of us from the Institute were in New York City for an event a couple of weeks ago I started off by telling people that last year, one of the times I saw Hans Hoppe, who was an affiliated senior fellow here at the Institute, I saw him and he was saying to me, Well, isn't it interesting? I see you have a new book. Congratulations. And I said, Well, not only do we have a new book, we also, even happier, we have a new baby. And he said, Oh, congratulations and everything. Because I'd had a number of books come out one after the other. so I said it seems like we're doing like for every book we're having a baby every baby we're doing a book and he said he's German he said well I don't think you can keep up that pace but yet I'm not entirely sure is he talking about books

2:36or babies well in the brief brief time I have you folks here today as by the way just force of habit I'm looking down at notes that aren't even here I'm used to being in the classroom there aren't any notes here it's all it's all up in my What I'd like to do is, given that we probably can't cover all of American history in 45 minutes, let's say, instead, what I'd like to do is sort of gallop through some highlights or some areas of importance, or in particular areas in which the material is simply not covered in the typical American history classroom and even in college. Not that it's covered badly or you get a lot of lies about it. It's just not covered at all, it's like left out, you can hear crickets in the background, nothing, not mentioned.

3:25Because oftentimes the worst bias in the coverage of American history does not involve outright falsehoods. Sometimes it does, but mostly it involves the selection of topics, what items are brought up, what items are excluded. And I think by and large, by the way, that's also true for the much trumpeted media bias that we hear a lot about. It's not even necessarily that the media is feeding us lies, although, of course, naturally, they are. But it's also, what are they not feeding us? What are the stories they don't tell? Okay, so I want to tell a few of these types of stories from American history to inoculate you against, you know, what you're going to be up against when you head to college. Now, since you're all homeschooling folks, you all know this. You all know that out there, frankly, is a kind of hostile educational establishment That is not all together reliable in areas like American history, so you already know that you better know your stuff because you're not going to be taught it by these people.

4:22What's even more fun is when you really know your stuff and you go into that college classroom and your professor finds out that you really know your stuff, but be careful about how you do that. You don't want to get an F for no good reason, you know, just antagonizing them, but it's good enough to know in your own heart that this guy is, I don't want to say a bad word, This guy is a falsehood artist, we'll say, whereas I know the truth. That's very satisfying, and I want to help to move you in that direction. One of the benefits of my book, if I may put it that way, is that it has a bibliography at the end that refers you to books that I consider to be reliable. There are a zillion books out there. How do you know which ones to read? In fact, two years ago, they did a study. They found out that in the year 2004, How many books were published? 195,000 books were published in that one year.

5:12195,000 brand new books. How can you possibly sift through them all and know which ones are reliable or worthwhile? That's up 70% from just 10 years ago. So books are coming out like mad. How do you sift your way through? So I've got that, and then throughout the text I have these little boxes that say, a book you're not supposed to read. A book that the establishment would rather that you not read, so it helps to direct you in your research. Well, the first of the several topics I'd like to try to get to takes us back over 200 years. And it takes us back to an incident that, to my knowledge, has never been commemorated by the U.S. government. We get a lot of commemorations, let's say, of a war ending. It's victory over Europe in 1945. People want to commemorate that.

6:00or the bombing of Pearl Harbor. People want to remember that because of all those people who died in that attack. But there are some events that are simply never commemorated. And one of them involves something that Thomas Jefferson did in 1798. It's never been commemorated. And my suspicion is because the government is afraid if they commemorate this, they might be giving us some ideas. What was Thomas Jefferson up to in 1798? Well, Jefferson was the vice president, which is not a particularly powerful office or it I suppose it can be I think Dick Cheney has made it more powerful than it has been but for Thomas Jefferson there was really not much to do all day well it so happens that in that year because the US was sort of and sort of not at war with France in fact it was so sort of and sort of not at war with France that the war is known as the quasi war with France we can't even make up our minds are we at war with France

6:53The President John Adams would be found in public with a sword by his side as an indication of the fact that we are on a kind of a military footing. And the Congress in 1798 passed a series of laws and one of them, in effect, made it a criminal offense to criticize the U.S. government too harshly. You could actually be thrown in jail or fined for saying unkind words. For example, there was one poor soul who just simply said offhandedly, I hope the presidential saluting cannon fires a cannonball right into the behind of President John Adams.

7:38And that guy was fined $100 because you're not allowed to do that. There were newspaper editors who found themselves being sent to jail Because they said unkind things about the US government. Well, what's interesting about all this is, for one thing, is that at that time there were two political parties. There were the Federalists, John Adams was a Federalist, and there were the Republicans, not the same Republicans as today, Thomas Jefferson belonged to that party, and it's interesting that when you read this law, the law is obviously designed to make it illegal to criticize the Federalist Party because it says you can't criticize the President, He belongs to the Federalists, criticized the Congress, which has preponderance of Federalists, and it goes on and on. But it doesn't say anything about the Vice President, who happened to be a Republican.

8:25You can say anything you want to about him, no law against that. So it's a little bit obvious that this was aimed at Jefferson's party. Jefferson didn't take too kindly to this, and Jefferson thought, what do we do? The Federal Government is obviously violating the freedom of speech here. You should be able to wish that cannonball thing and not have to pay a fine. to pay a fine. So what do we do? And Jefferson, it's interesting what he did not do. He did not say, well, it was fun having a free society for ten years, but I guess we may as well give up on it, or this constitution worked out okay for a while, but I guess it's going into the can. He didn't do anything like that. He didn't say we should just give in or we should forget about it. He said we need to fight against this. But how do we fight against this? Do we wait two years for another presidential election? In two years, we might all be in

9:10in jail, you know, how we can't wait two years. What do we do? Do we all sign petitions to the government? Oh, please, please take this terrible law away. That's pathetic, you know, nothing's going to come of that. What other things can we do? So we think of all the different things we could do. And he didn't say, by the way, let's go to the Supreme Court and see what they say. Because number one, the Supreme Court is full of people who have been appointed by the Federalist Party. So they favor this. So the Supreme Court is not any Also, Jefferson didn't like this idea that we should go to the Supreme Court and that the Supreme Court is made up of these demigods who are all-knowing and who have their black robes and they go into some closed room and they decide what our Constitution means and then they come out and tell us. He thought that was very dangerous. He didn't want the Supreme Court to have that kind of power.

9:56So what did he decide to do instead? Jefferson proposed an extremely radical-sounding solution. Jefferson said that each state of the United States should have the power to be able to decide if it believed the U.S. government had violated the Constitution, had done something that clearly was not allowed under the Constitution. The state should have the right not only to say that that had happened, but the state should also have the right to say, we are not going to enforce that law. We're not going to enforce your anti-free speech law in this state, in Virginia or in Kentucky. We're not going to enforce it there. That was the proposal that Jefferson developed. And he said, now this may sound crazy, you know, I mean this may sound crazy that every state could have the power to say to the federal government, we're not going to enforce your stinking law.

10:43But Jefferson's answer was, well, what better solution do you have? What other solution is there? There really isn't any other solution. If we don't do this, we're just going to encourage the federal government to do more things if we don't act right now. So that was Jefferson's solution. It was called nullification. If the federal government comes up with a rotten law that violates the Constitution, we nullify it in each of the states. Each state gets to decide if it wants to nullify it. Because Jefferson says, look, we've got two parties here. We've got the federal government and we've got the states. And we can't say that the Constitution can be interpreted only by the federal government and not by the states. Because nobody would ever enter into a contract where only the other side gets to interpret what it means. I would not go up to Mark Thornton and say, Mark, I'm going to give you 10 bucks to mow my lawn.

11:29But only you get to interpret what that means. Because that may mean that 30 years down the line, he still hasn't mowed my lawn. And he could come up to me and say, well, my understanding was that in 50 years' time, I mow your lawn. And you give me the 10 bucks now. And I would probably say, well, that's not the way I interpreted it. But suppose only I could interpret it. Maybe my view would be Thornton mows my lawn now, and I pay him in 50 years. I mean, what happens when only one side gets to interpret what a contract means, you're going to interpret that contract in a way that benefits you. And Jefferson said the same thing would go for the Federal Government. If only they get to interpret the Constitution, well, what a surprise. They're going to interpret it to mean the Federal Government gets to do whatever it wants. If the states can't stand up and resist that, well, we have no right to be surprised when,

12:17over time, the Federal Government gets all the power and the states are destroyed. So Jefferson and James Madison together anonymously drafted a couple of documents, the Virginia and Kentucky resolutions of 1798. Virginia and Kentucky in their state legislatures passed these documents that declared that not only do we protest this anti-free speech law, but we also say that the states can resist it. They can say we absolutely refuse to obey this because it violates the Constitution. And if it violates the Constitution then it is no law at all. Now when I started this little discussion, I noted that these documents that basically said the states can resist. These documents have never been commemorated.

13:03In 1998, did Bill Clinton say, hey everybody, let's all get together and commemorate the 200th anniversary of the Virginia and Kentucky resolutions. He would have died a thousand deaths before doing such a thing. Because then people might think, well, gee, can we do that now? Can we do that now? We don't want anybody thinking that. No, heavens no, we can't have that come up again. So therefore, this episode is either passed over or barely mentioned or misinterpreted or whatever, but it was an essential idea. In fact, it was so essential that for decades after that, people referred to these ideas as the principles of 98, referring to the year 1798, the idea that the federal government has only a few powers that the states gave to it, and then any other powers rest with the states.

13:49If the states believe the federal government has gone beyond what it's allowed to do, then those states can refuse to obey those laws. That became known as the Principles of 98, and they remained alive for years and years after that. The New England states referred to the Principles of 98 over and over and over again. So this is a major part of American history and a central building block in the tradition of American liberty that has just been totally forgotten. How often is this brought up? Never. What a surprise. All things to leave out or to glide over quickly, it's pretty revealing that this was one of the ones that you just don't ever hear about. Or another area, I remember, good grief, I remember when I was in high school, I remember reading the textbooks I was being given in high school, and I remember thinking, there is something rotten in here. There is something that is just not right.

14:37And in particular, I remember the way big business was treated. Now, you can't make any blanket statements about big business, because sometimes businessmen are wicked and should be behind bars. There's no question about that. They have all the same moral foibles the rest of us have. But at the same time, you also can't go to the other extreme and say, all businessmen are evil. They're all evil. All they do all day is exploit people. And because of big business, if big business had their way, we'd all be

15:38There isn't a textbook out there that teaches you anything different. You get the same all the businessmen were wicked. Well, what I've tried to suggest in my book and in some of my other work is that, in fact, if it weren't for big business in the 19th century, which is the time when supposedly everybody was being exploited by the businessmen and all that, people would have been living much, much more miserable lives than they actually were living. Because, for instance, if you think of the guy who has been most demonized of all, the guy who they may as well draw horns on his head in the textbook, would be John D. Rockefeller, the great oil giant, who was involved in refining oil. Now, it's important to remember, by the way, that, you know, oil, you pump it from the ground, and then you refine it, and then you use it.

16:26Well, initially, people didn't know you could really use this black stuff coming up from the ground. It was just a big nuisance. If you were a farmer, and you had oil underneath your property, The Theory of Money and Credit

17:05That's what happens, that people figured out this black stuff that seems like it's just annoying has a very important use and in the mid-19th century it was discovered you can actually pump it up from the ground. You don't have to wait for it to just bubble to the surface and then try to scoop it up, you can pump it from the ground. Well, this changes the landscape because now you can make this into kerosene and instead of having to light your home using whale oil as an illuminant, you can use kerosene. Whale oil costs like 500 zillion dollars an ounce. That's an approximation. It's not an exact statistic, but it's extremely expensive. Most people can't afford whale oil. Whales aren't that happy that people are using whale oil either. But if you don't have to use whale oil anymore because you've got cheap black stuff coming out of the ground, that's in advance.

17:51And so John D. Rockefeller got involved in the refining of oil. You take the crude oil from the ground, you refine it and make it into kerosene. Well, the interesting thing about Rockefeller is sort of two-fold. First, when Rockefeller first got started in this, kerosene was a dollar a gallon. By the time Rockefeller was done, it was ten cents a gallon. Now imagine something, in our day, nothing really other than computers seems to go down in price. Imagine something going down by that many percentage points in price, and something that's so essential. You don't have to go to bed early anymore because you can't afford the whale oil to light your home. You can actually stay up late at night. Great. Wonderful. I'm sure parents are thrilled at that. My kids can stay up even later than before. Great. But that is an advance in people's lives. They have a much higher standard of living as a result of this.

18:41They can get these things for much cheaper. Secondly is that Rockefeller was a stickler for efficiency. He hated wasting things or throwing things away. Now, I know we all know people who just don't throw anything away and that's not very efficient at all. The Theory of Money and Credit

19:25And that's amazing. This is not some guy to be despised and hated and draw horns in his head. I mean, we should reward that guy. I mean, yeah, he became rich. Well, he should. If he can figure out 300 things to do with guck, I'll give him a couple of bucks too. So this is an important advance. But instead, what do you read in the textbooks? Oh, he's vicious and terrible. But what you don't hear about is, well, did oil get cheaper or did it get more expensive? It got much cheaper. Now, it's true that the Rockefeller Foundation has done a lot of rotten things, that's a separate matter. The point is that as an entrepreneur, Rockefeller did great work for the average person. Or then you have Andrew Carnegie, he was involved in steel production. Every other thing in a modern economy is either made out of steel or requires steel in order to make it.

20:13So if you can cut the price of steel, you can make everything in the whole economy cheaper. The government can make you better off by robbing your neighbor and giving you the money, but that doesn't make your neighbor better off. But if I can make everything you and your neighbor buy cheaper, that helps everybody. Carnegie was able to do that. He was so efficient that in his homestead plant in Pennsylvania with 4,000 men, he could produce three times the steel they were producing at the greatest European factory with 15,000 men. The price of steel rails over the course of about a quarter century declined about 90 percent. Again, almost like the reduction in the price of kerosene.

21:00An amazing advance. So that means not only is steel cheaper, but now everything that requires steel is cheaper. Now, do we see in the textbooks people saying, wow, that's wonderful that Carnegie did this. No, Carnegie's terrible and greedy and wicked and evil. Well, okay, maybe you feel that way, but that's not a very useful historical statement. I mean, what did the guy do? Why don't you tell me that? You don't typically get that in the books. Here's what you do get, okay? Typically, you get this. You get this argument that big business, and here's your term for the day. Big business, we are told, engages in something called predatory pricing. Ooh, ooh, what does that mean? Well, that means that supposedly big business has the power to, let's say, let's say it's me and Dick Clark's here in the room.

21:48We have a guy here named Dick Clark, okay? I'll leave all the jokes, American bandstand jokes out of this. It's not fair. And the young students don't even know what I'm talking about. Anyway, fair enough. But suppose I'm competing with Dick Clark. The idea is that if I'm a gigantic business, Business, I can charge such low prices that my smaller competitor, Dick Clark, and Dick Clark is like three feet taller than I am, my smaller competitor, Dick Clark, can't possibly match my prices, so I drive him out of business. The idea of predatory pricing is that I price my goods so low, nobody else can price them that low, they all go out of business, everybody buys from me, but then when all my competitors are out of business, then I jack the prices is back up because where are people going to go? Okay, so it's sort of the principle of why it is if you go to the movies.

22:34I don't know why these days you would, but let's say you go to the movies. You notice that the small drink is like $8.75. Like, why is that? Well, pretty much because where else are you going to go? You can't smuggle drinks into the theater, and you don't have to tell me stories about I smuggled a beer. Yes, I know you can do it, but you're not allowed to do it. The point is there's nowhere else for you to go. Well, that's the idea of predatory pricing. The big business drives all the competitors out, raises the prices, there's nowhere else for you to go, got to buy from him, and then he makes all these great profits. Now, a lot of us sort of think, well, you know, that is what happens. Big business can do that, drives all its competitors out and then raises its price. The problem is, you almost cannot find any examples of this. This is one of the problems with the theory, is there don't seem to be any actual real-life examples.

23:19We've seen examples of businesses who lower their prices, but we don't really see examples of them raising their prices back up. If Walmart tried to raise their prices back up, everybody would just go to Target. Or they'd go to Kmart, or they'd order from Amazon. It's too difficult to do this. And even if you do manage to drive all your competitors out, new ones will pop up. If you start raising your prices again, new ones will pop up. So economists these days no longer believe in this. The general public believes in it because that's what we're told all the time. Big business wickedly drives everybody out of business by charging low prices. I want to give you a cutesy little story to show what happens when you try this practice of charging really, really low prices to drive out your competitors and then you get to raise your prices back up again.

24:10One of my favorite stories from American business history, which I do include in the book, involves Herbert Dow. Tao, the name may ring a bell, he ran the Tao Chemical Company. He's dead now. He would be like 187 today or something. But he founded Tao Chemical around the turn of the century, into the 20th century. And he's a great chemical genius. And he was a really, really hard worker. I mean, really hard worker. He would work 18 hours a day and then sleep at his chemical factory and then start up his day again. Now, sure, it meant he grew like a second head The Theory of Money and Credit

25:13U.S. for After a while, he get a little bored with it. Where else can I sell Bromine? So he thinks how about Europe. I'll sell chemicals in Europe. No problem, right? Except if you try to sell chemicals in Europe, there's a group of German chemical sellers who don't want anybody else selling in Europe. So when Herbert Dauss shows up in Europe and says, hey, got cheap Bromine for everybody, this cartel of German producers knocks on his door and says, oh no you do not. You don't sell anything in Europe. We're the German cartel. When we sell the chemicals in Europe, you're not going to sell anything. And he said, well, you know, there's no law against it. I'm going to sell my chemicals here. And so the Germans got really upset. Who does this American upstart think he is? Well, they were selling bromine for 49 cents a pound.

25:59Herbert Dow is selling it for 36 cents. So, of course, everybody's buying from him and nobody's buying from this German cartel. They're going crazy. What are we going to do to this guy? So they think, we'll destroy him. The Germans will sell bromine in the U.S. at a price he can't possibly match, and that'll drive him out of business. So they were going to try predatory pricing. So the German cartel starts selling bromine right in Herbert Dow's backyard in the U.S. for 27 cents a pound. So what's Herbert Dow going to do? He can't possibly match that price. Well, he's clever. He's one of the cleverest businessmen you've ever seen. What he does is he has his purchasing agent go buy up tons and tons of this bromine at 27 cents a pound in the U.S. And then he goes to Europe and sells it again at lower than 49.

26:47And so the Germans don't know what's going on, but they're saying, man, there's a huge demand in the U.S. for bromine, much bigger than we thought. How can we possibly keep up with this? So he's still going just fine. He's just buying it up at their price. So as time goes on, they lower it to 15 cents. We'll drive this guy out of business, we'll sell it at 15 cents a pound in the U.S. So he just keeps buying it up at their price and selling it in Europe. And the thing is that they're making losses. When they're selling bromine at 15 cents a pound, these Germans, they're making losses. They want to make up those losses selling at 49 cents a pound in Europe, but he won't let them. He keeps buying it up and selling it cheaply in Europe. So finally they reduce it to 10 and a half cents a pound. I mean, this is going to kill them. And finally, 1908, he gets another knock on his door.

27:34Not nearly as brusque as that first knock. And so finally, they say to him, well, how about this? How about we sell bromine in Germany, you sell in the United States, but the rest of Europe is open to free competition. What do you say to that? And he said, OK. And so by just sticking to his guns, Herbert Dow totally defeated this predatory pricing attempt and became quite wealthy in the process. He did very well and established, in effect, a free market in chemicals for the future. So I think that's kind of an interesting story, but where's Herbert Dow in the curriculum? You know, why is he not mentioned? He's a great man, Herbert Dow. We should be proud of him as Americans. All right, let me just pause here for a second.

28:22I mean, I get so worked up when I'm talking about bromine. The Theory of Money and Credit

28:55I want to say something about is the Great Depression. Now, some of you will be able to talk to people in your own families who lived through the Great Depression, who lived through the 1930s when the economy just absolutely tanked, when millions of people were out of work. They did some study that said that if you took all the people who were out of work at the height of the Depression and you lined them up from New York to Los Angeles I don't know how you'd have the time to calculate something like that, but the point is a huge number of people had no job whatsoever, and prospects were very bad. Businesses were doing badly, profits were negative, investment was negative. That seems odd. How could you invest a negative amount of money? How could you invest a negative amount of money?

29:42Hello, I'd like to invest negative twenty dollars. What that means is that equipment was wearing out faster than it could be replaced in the thirties. So absolute disaster. And so you hear horror stories. I mean, I've heard them. People eating ketchup sandwiches. People would come over to my grandparents' house. They'd have a head of lettuce and a tomato. And they'd get it divided up. This is not a pleasant time to live. When you read about this in the textbooks, what you get is this, well, the evil free market caused the depression and then everybody suffered. Well, that issue I'm leaving aside because that's a complicated issue involving the business cycle. But suffice it to say that's not the case. The free market did not cause the depression. The Federal Reserve system caused the depression as Rothbard showed in his book, America's Great Depression. What I want to look at is not what caused the depression, but why did it go on for so long, year after

30:34year after year after year. I mean, you know, everybody in this room has lived through some sort of difficult times, but you know, then you see a little bit of a recovery and things sort of go on. But you don't see year after year after year after year of just no expansion, no growth, unemployment 25% or more. You don't see this. So what was going on in the 30s? What made it go on for so long? And what is so odd to me is that you pick up, I remember Any textbook that I read in high school, or any one you pick up now, they will all say that thanks to the U.S. government, we got out of the depression. Well, let's see. During the entire 1930s, the average rate of unemployment was 18%. Now, today, if you have 5% or 6% unemployment, people are saying, well, this is terrible, it's a disaster.

31:21Well, maybe 6% will say it would be really, really bad. 7% would be catastrophic. 18% on average during the 30s, and I'm being told that the government got us out of the depression, well they took their time about it, if that's what you're telling me, that they got us out of the depression. Let me just give you one example of the type of policy that was introduced in the depression. This is by people with brains, people with a beating heart and a pulse, devised this policy. It was decided during the depression that the farmers were doing badly. Well, that's true, because the farmers are human beings and all human beings were doing badly. So, of course, the farmers being one subset were doing badly. So we want to help the farmers. So what are we going to do to help the farmers? Are we going to try to reduce the tax burden on them? What are we going to do?

32:06No, here's what we're going to do. Suppose you're a farmer. Let's just say suppose you produce cotton. Let's say you produce cotton. And let's say all the cotton in the United States was destroyed The US government decided to destroy 10 million acres of cotton and plow it under and destroy it, so that the remaining cotton will be more expensive than the rest of the cotton.

32:50And the farmers will get more for it, they can charge more. Or pork prices, you know, we want, pork prices are pretty low right now. That's not good for farmers who are raising pigs. So let's kill six million pigs, then there'll be fewer pigs, less pork, the pork will be more expensive and the farmers will do better. Now that's, you don't need to have any economic education to see that that's really a bad thing. to destroy 10 million acres of cotton or 6 million pigs. In the 1930s, people are eating ketchup sandwiches, remember that? They're eating a head of lettuce and they're passing it around. They're eating a head of lettuce for dinner. And you're going to make pork more expensive by killing 6 million pigs.

33:35That might offend some people. But instead, we've got to make the farmers richer. Well, you might make the farmers slightly richer, but you know what you're not going to make richer? Everybody who eats. Everybody who eats will be made worse off because the supply is less. Or anybody who wears clothing is going to be pretty much at a disadvantage when 10 million acres of cotton are completely destroyed. But that was the genius program that was developed in 1933, which is going to start destroying things. And that will make the farmers wealthier. As I show in my book, it didn't even make the farmers wealthier for other reasons. But it made everybody else poor. It just destroyed things. Could you possibly imagine somebody saying, I have a way to make you richer. Everything that's in your bedroom, I'm going to destroy it. I mean, like, you would never say, well, that's a great idea. I think that's what we should do.

34:21Let's just start destroying things. Like, why would you do that? Well, eventually, the federal government decided that this is not very good public relations. It looks kind of bad when we're slaughtering all these pigs. I mean, some people find that a little bit, well, kind of spooky, actually, that you're going to slaughter six million pigs. So what they would do is, after the 1933, the federal government had this policy where What we'll do is, we'll just pay the farmers not to grow the stuff in the first place so we don't have to go to the trouble of destroying it. So the new policy became, we'll pay the farmers not to produce. So we'll pay you to sit there like a bum, pretty much. We'll pay you to sit there, or we'll pay you to produce only one third of what you can produce. And that way we'll have less stuff, and it'll be more expensive, and that'll be good for the farmers.

35:07Yes, good for the farmers, but not good for anybody who buys those things. And also, suppose you're a farm worker. What you do for a living is you work on a farm. And now the federal government says, we're not going to farm nearly as much. We're going to cut out two-thirds of the farming, let's say, or half, or whatever. What is there for you to do anymore? Not much. So it turns out that two million farm workers were thrown out of work by this, because what is there for them to do if people are cutting back on farming? So it's a complete disaster, but yet something like this program continues in existence to this day. Typically, every year, if you're wondering, you say to yourself, boy, orange juice is kind of expensive, isn't it? You know, like, you always have to wait for... I mean, if you're like me, you only buy whatever orange juice is on sale that week, right? Like, I would never dream of buying Tropicana at the normal price.

35:55Whatever's on sale, if it's Joe's orange juice, I don't even know who Joe is, I'll take it, okay? Orange juice is a little expensive. One of the reasons orange juice is expensive is that it's the legacy of these programs from the 30s, is that every year 40% of all the oranges grown are either destroyed or fed to livestock or otherwise gotten rid of. So therefore the remaining 60% of the oranges will be more expensive and the orange growers will do better. But anybody who enjoys orange juice does worse. There are programs like this all over the economy and we have the geniuses from the 1930s to thank for this and that was supposedly to lift the country out of the Great Depression. Depression, that didn't actually work. They ended up finding out that destruction and producing less does not make you richer.

36:43But it took a long time for that to come out. Now, there's much more that can be said about that. But that's, I think, the easiest program to see through, that it's probably not going to bring you prosperity. Well, what I've said to you today in this brief time are examples of the sort of thing you're never going to hear about. If you go off to college, you are never going to hear about this stuff. Or you'll hear about it in one little sentence while the professor is taking a drink of coffee and he's speaking into his mug. Like, you won't hear it. So why won't you hear it? Because there's an agenda at work here. People who teach history typically, well, not typically, I don't want to besmirch them all, but a good many of them have an agenda. They want you to leave that history class thinking a certain way, thinking that the government is the great savior full of wonderful people pursuing justice

37:31and Justice, and anybody not in the government is wicked, evil and an exploiter. They want you to basically leave thinking that. So they're going to teach you history that makes you think that. Unfortunately, it's not true. So it's very important to arm yourself against this so you don't become another one of these robotic idiots who just repeats myths all the time. You can actually be one of the intelligent people in the world. And I'm happy to say that even though it's not anywhere near a majority of people who are being home-schooled right now, Still, I believe, because of the appalling ignorance of the typical high school graduate in the public government schools, disproportionately the educated people in this country, 20 years from now, will disproportionately, way out of proportion to their numbers, have come from homeschooling families. So, very good. I'm very glad you're all doing this and in a couple of years I'll be joining you myself.

38:20Thank you all for your kind attention.

38:29So, shall I invite some questions? Yes? Oh, thanks. Now see, I choke under these circumstances. I mean, if I'm talking about history, I can be funny. But if I'm trying to be funny, I'm afraid all I do is talk about history. You know, it would just be, the War of 1812 was, and people would be throwing things. I have to say, the cotton restriction stuff, it gave my father a job. He got to work for the government, go around, and report if people were growing cotton and not supposed to be. I would bet some people would be telling him to get off their property, but in fact though, that goes to show Mark Thornton's point that you can't look at a program just in terms of its short-term effects.

39:25Yes, that did employ some people doing that, but what did it do to the whole rest of it? Okay. And in fact, Ralph Cramden met Alice at the WPA. She was handing out the shovels, if I remember the honeymoon is correct. Okay. But, you know, that's just a side effect of these programs. Anything else? I've heard about the railroad, how much more efficient the railroad is to take freight across the country and impose some of the trucking thing. What are the subsidies that are still working and laws that are still in balance in that?

40:16from the Federal Government, but they were special favors that tended to distort the way the railroads put their tracks down, because you would get more goodies from the Federal Government the more track you put down. So instead of thinking, well, I have to really watch my money and just develop the straightest track, if you're going to get more goodies the more track you put down, you're going to go like this, right? In fact, the Southern State Parkway in New York, if you take the Southern State Parkway, the whole ride is

41:14Paul. He had a railroad going from St. Paul to Seattle. It took no government aid at all. And when 1893 came and most of the other railroads went bankrupt, he turned a profit because he had a super efficient road and he paid for the right of way. He actually negotiated with various Indian tribes. He came in contact with... He didn't just say, well, there are Indian tribes in the way. I'll just exterminate everybody. Instead, he said, well, you know, here's this and that and he arranged it and he ended up having one of the best, cheapest, How did you become interested in what you do?

42:12What kind of a... what's the matter with somebody like that? But I became interested in... I went to Harvard, undergrad, and I found that all the other math majors, all they did all day was math. So even when they weren't doing schoolwork, they'd be reading books on number theory or this or that. But in my spare time, I wanted to read history, and I thought, how am I going to keep up with people who all they do is math? Plus, this is just not normal, right? I mean, shouldn't you have another interest? Well, then also, on my way to dinner, On my way to dinner, every single night, I would come in contact with this, there was a group of communists who would stand there selling the workers' vanguard newspaper. And they were denouncing this and that U.S. policy, and they were talking about the need for the communist revolution. And I thought, my gosh, don't these people know about the tens of millions of people who were killed by communism?

43:01I mean, so this little naive kid, I would actually stop and say to them, what's the matter with you, you savages? Savages. I mean, people like this have killed millions of people. You want to bring this to America? And they'd be denouncing me as some, you know, whatever, U.S., you know, lackey or whatever. And so, when you live in Cambridge, Massachusetts, and you're not in normal America for a long time, it seemed to me like we are on the verge of a socialist revolution in this country. Because, I mean, you see communist newspapers everywhere. I had to buy my textbooks. and for one course I had to buy my books at a store called Revolution Books and you go in there and they've got pictures of Stalin and Mao, you know, between them, you know, again tens of millions of deaths they're responsible for and they got their pictures up on the wall and I'm supposed to go and buy books there so remember I walked in there and I walked out and said I don't care how long it takes me

43:53I'll go around this whole city buying these books, I'm not giving my money to these people I had this distorted view that, my gosh, the whole country is being swept away by communist propaganda. No, it's just like this one street in this one city. But it made me think, man, I better throw all my resources, all my intellectual talents, whatever, to save this country from this. So I began to start reading more and more and more about communism and this and that. And then before I knew it, I said to myself, this is what I want to devote my life to, is a study of ideas, a study of history. And I'm going to miss doing math, but I feel like, you know, here I could do something that really interests me and that I feel like is doing something that's worthwhile for society. Math is worthwhile in its own way, it's true, but I just felt it to be much more compelling and important at this moment

44:38for me to learn history so I can go after these guys. And then when I realized the communists weren't really a big threat in America at this point, nevertheless there is no shortage of people though who need some sort of historical enlightening, so the knowledge did not go to waste. How did you become a writer? Just because if you're interested in it, it just flowed out of you naturally?

45:22I emailed him one day and I said, hey, I don't know why I was telling him this, I made 15 bucks today participating in a psychology experiment in the Harvard psychology department. That's how we all made our spending money. It would be like a thing to test your memory under certain conditions, whatever. And you'd walk out with five bucks, seven bucks, 10 bucks. And Jeff was saying, well, I can't believe you're wasting an hour or two hours or whatever making this money when you could spend a few hours writing an article and make 150 bucks or something. I thought, me? Write an article? And then like a whole new world opened up, you know, like just a whole new world. And so from that point on, and then the more you write, you know, the more easily it comes and that sort of thing. So it was just him telling me, stating the obvious, why don't you start writing? And I thought, okay.

46:08And then before you know it, and by the way, the best advice in terms of becoming a good writer is to read people who know how to write. Read good writing. and then when you write your sentence then you sit back and say like let's suppose you're reading H.L. Mencken, who's a great writer then you go and write your own essay on whatever topic and then you step back and say Mencken would rather die than write this terrible sentence and then you whatever and until it you don't have to write exactly the way he did but it makes you be much more self-critical you think my gosh the elegant beautiful sentences that so-and-so writes you know you know my stuff doesn't match up to that but at least it gives you something to shoot for I found that most of the students I had, not most, almost every single one, were extremely bad writers. Not just that the prose didn't flow very well or they chose the wrong word

46:59all the time or it was awkward, but they couldn't organize their thoughts. I feel like the home school people, there's much more emphasis on this, but organizing your thoughts, thinking rationally, developing what is it that you want to say and then learning how to support what you want to say and then drawing a sensible conclusion. This is like, I may as well be Do you have a publicist? Or did you do it yourself? How did you get to the New York?

47:47I did a PhD dissertation at Columbia, and then I expanded it, and they really liked it, and so it became a book, and it was wonderful. But those are going to be small selling books, because it's really a very specialized kind of study. But then this thing, this just fell into my lap. Regnery Publishing, which has been around since 1947, publishing conservative libertarian books, they called up and said, we want to write a book, we want somebody to write a book with this title, The Politically Incorrect Guide to American History Are you interested in doing it? And I thought about it and I said yes. And I almost said no. What a stupid decision that would have been. You know, this has opened so many doors for me. I mean, it would have been like those record producers who told the Beatles, well, groups with guitars are on their way out so we're not going to sign you and then they go on and make a zillion dollars.

48:35Well, it was this sort of thing. I almost didn't. Because I thought, when would I find the time? Well, I found the time. So they came up with the idea, and Regnery has got a tremendous marketing arm behind them. So they can get out there and publicize your book. They can get you on TV, on the radio. They can line up, speak and engage. Well, I usually do that. But the point is that there are a lot of opportunities that came from the fact that this is a big publisher. Because again, how do you get your book to stand out from 194,999 other ones? Very, very difficult. So thankfully, next spring, my book is coming out from Crown Forum, which is a division of Random House. and so we're hopeful that we'll be able to get the word out about that one. But that's basically the key is having a publisher behind you who is committed to the project. And another thing is that Regnery only puts out about 15 books a year.

49:24So they're very careful about what they choose and then they throw themselves behind each one. Now I have friends who have published for Doubleday and other major publishers, but Doubleday will put out 3,000 books in a year and they'll pick which ones they really want to push. Did they book your engagements? You said you did a lot of that yourself. Now, how has the word liberal come to the transformation it's gone through in the last 100 years, a couple of years?

50:31from Harlem was where Columbia was. That was my representative in the house. Yikes. Like, how did this happen? How did we degenerate to this point? And it's not an easy question to answer, but part of the answer goes like this. Some of the people who used to be classical liberals believed that if you take away all these government advantages for big business and whatever, take away all the government privilege, that will help the poorest, which which it did. But there were some who thought that it would also, it would lift the status of the poor really, really high, that the only thing preventing total equality in the country was that government was favoring the wealthy and powerful. We take that favor away, we have the government be totally neutral, everybody will be equal. Well then, some liberals got impatient with that and thought, well, now we've pretty much stripped the government down and yet there's still inequality.

51:22So I guess we now need the government to actively intervene and bring about equality. So I think that's part of the evolution. Okay, anything else? Well, it's been a real pleasure. I was very glad to meet you all and I hope you enjoyed it today. Thank you very much.