Introduction to Libertarianism II

0:00Welcome to the second session of Introduction to Libertarianism, where I go over Defending the Undefendable. Could we please start with a moment of silence, as is our usual practice? Okay, before I get into it, I thought I'd do some housekeeping notes and points and stuff like that. First of all, anything about anything. Well, it has to do with libertarianism or economics, but it doesn't have to be on the same subject, like if I give a talk on the minimum wage and you want to ask about intellectual property, that's fine. Anything goes. Secondly, I greatly apologize for calling Chad Parrish a sissy.

0:48I have to realize that the man behind the camera can make me look good or bad. So, Chad, you the man. I'm very grateful to John Sophocles for giving me a quote from James Buchanan on the Card-Kruger business. It is printed not in the American Economic Review, which is the top journal, but the Australian Economic Review, which is not up there. But in any case, and this comes from the New York Times, no, sorry, the Wall Street Journal. And the quote is, quote, just as no self-respecting physicist would claim that water runs uphill, no self-respecting economist would claim that increases age, increase employment.

1:39Such a claim, if seriously advanced, becomes equivalent to a denial that there is even minimum scientific content in economics and that, in consequence, economists can do nothing but write as advocates for ideological interests. Fortunately, only a handful of economists are willing to throw over the teaching of two centuries. We have not yet become a bevy of camp-following whores." Well, you know, I've criticized Buchanan, but I tell you, heed a man here. That is utterly and totally magnificent. No belt ties here. Yes, this is hot stuff. It's interesting that Clinton, President Clinton, when he was president, cited Cardin Kruger's proof that we should raise the minimum wage law, which probably got all right-thinking economists even more on edge.

2:35And by right-thinking economists, I'm not just limiting to Austrians. Well, no, I guess I am limiting to Austrians. But I'm now including Becker, and Welch, and Hammer, Nash, and all those other guys as Austrians, because they really came out with fire in their eye about this. There's an interesting story behind the Australian or the American Economic Review. And there's a magnificent article by Dan Klein and a guy named Chang, I forget his first name, in Dan Klein's new journal, where he makes the point that the reason that Harvard and Yale are such great places and their econ departments are so great is because they publish in the JPE and the AER. And the reason the AER and the JPE are so great is because people from Princeton, Yale and Harvard publish in them.

3:22And it's sort of incestuous kind of a relationship. It's the point, a well-known point that the American Economic Association was started by a bunch of German socialists in 1898 or so. and they haven't changed their spots too much. Okay, so that's one bit of housekeeping that I wanted to get through. The other bit of housekeeping I want to get through is Dan McCarthy raised the magnificent point about blackmail. Later on, he said, you know, he hoped that it didn't come across as hostile or anything. And, you know, I assured him it didn't. And even if it did, it's okay. Because what we're involved in here is to try to get at the truth. And the only way to get at the truth is to have at me.

4:09And I won't be hurt. You know, I've made mistakes before, and I will again. And I want to hear it from you so that I can improve. And together, we will have more knowledge than individuals alone, as shown by cooperation and all. In any case, if I understand Dan's criticism, it is, if I can put words in his mouth, Well, you know, this blackmail stuff that you gave us is all as part of libertarian theory. However, it will actually increase the murder rate. Because if blackmail is illegal and people don't blackmail or fewer people blackmail, then if you see a murderer doing his to the forces of law and order, whereas if blackmail is legal and you're more likely to engage in blackmail, you'll blackmail him and he'll get away with murder.

4:57Well, first of all, if he gets away with murder and he's under the thumb of a blackmailer, he's not really getting away with it, because while hands of a blackmailer are then in a gossip, but it's much better not to have your secret out in the first place, because the blackmailer can exert certain things on you that you don't want. You can almost into a veritable slave, depending upon the bargaining situation. Now, my answer to Dan this time yesterday was, well, rule versus act utilitarianism, it's true that in this case, maybe the act would increase the murder rate, but if we follow the rule of libertarianism, you know, have less murder.

5:43I should have had more answers and I have thought up of some in the interim. One of them is this business of the eyes on the street. Now, Jane Jacobs had a magnificent public housing. I'm seeming to get off the point, but I'll bring it back in a second. Death and life of great American cities. What she showed is that it's much more difficult to live in a public housing area than in the tenements that the public housing replaced, because the people who promulgately have this deep and abiding hatred Providing Hatred for All Matters commercial, and you'll notice that in no public housing project is there ever any stores at the first floor, whereas in the tenements in ordinary commerce, real estate, there are stores all over the place.

6:34What's so good about stores? What's so good about stores is that people go in and out of them, and they hang out in front of them. Little old ladies on the fifth or tenth or fifteenth floor look down, they have the eyes on the street, and they're ready to gossip, oh, it's with that girl, it shouldn't be, and I'm going to tell this one. and, you know, they're sort of the gossip people. So when you have a lot of eyes on the street, criminals being shy individuals who don't like to do their business in the glare of publicity, don't commit crimes there, whereas in public housing they do. Okay, well, what has this got to do with blackmail? Well, there'll be more eyes on the street looking out for murderers. If blackmail is legal, a lot more people will engage in blackmail And they'll look for murderers to pounce on them, which will reduce empirical claim.

7:22In other words, I'm not denying that Dan's point is correct. I'm just saying here's another point. And here's a third point. The third point is that right now, there's a equilibrium, if you will, or a choice, criminal behavior to do it individually or to do it in a group. Each has its advantages. The advantage of the group is the specialization division of labor, which works for criminal behavior as well as anything else. You know, one guy is the dynamite man. One guy is the best driver, and he could be the getaway driver. Another guy has got the best aim, so he could shoot best. And you have cooperation among criminal people. However, if blackmail is legal, people engage in more blackmail, et cetera, than they would otherwise.

8:08The advantage of labor and specialization and comparative advantage of criminal gang members atrophies because they can later blackmail each other. And if they blackmail each other, then the net profits from the enterprise are reduced and there'll be less cooperation. And if murder, as I suspect, like anything else, benefits from the division of labor, they'll now be less of a division of labor. So here are two empirical points, and it's an empirical issue. I don't swear that my two or three effects are stronger than his one effect. His one effect might outweigh all three of mine, but I'm trying to list all the effects, and if anyone can think of any others, it seems like a great paper in here somewhere that could be written. But mainly I'm concerned with libertarian theory.

8:55You know, I have in the back of my pocket or the back of my mind the idea that whatever is just according to libertarian theory will also be Utilitarian in the sense of reducing murder, but I can't prove empirical things, whereas the logic of liberty is more praxeological and you can deduce things and be sure of them in a way that you can't be sure of empirical things and I guess that's just the nature of the beast. Okay, I think I've now covered the housekeeping details that came up from the past and now I'm ready to get back I'm going to go back into Defending the Underpart 2, and the next character to take up with you is the guy who yells fire in a crowded theater, and I have a soft spot in my heart for him because, you know, he's great.

9:47The reason I was led to write this chapter was to combat what Oliver Wendell Holmes, a Supreme Court judge, said. He said, quote, free speech is not absolute. There are exceptions. You can't, I'm putting in falsely, yell fire in a crowded theater, unquote. Well, first of all, I'm not an absolutist on verbal utterances. There are certain verbal utterances that I think are illegitimate. For example, if you don't give me your money, I'll blow you up. Or if you don't give me money, I'll kidnap your kids. That's a threat. And there's no physical invasion there. I didn't do anything. I just spoke. I've got my hands behind my back. I'm not physically threatening anyone, but I now say that if you don't do this, I'll use violence against you.

10:36That itself would be illegal as I see it under a libertarian legal code. However, what he's got in mind here is not that at all, it's not making threats, it's, you know, this is the answering wedge and if free speech is not absolute then we have all sorts of truncations and limitations on free speech and before you know it there's very little free speech, like a recent one is this hate legislation, like if you say that Jews are sneaky or blacks are inferior or women are no good or whatever, you can be accused of a hate crime without even doing anything and in addition if you If you commit a crime, the punishment is higher if it's a racially motivated or a hate crime or anything like that.

11:23But all crime seems to be hateful and I don't see why they should punish you additionally for the thoughts in your head as opposed to your actions. This is different than motivations. The difference between an accident and a purposeful crime is an important one. So it's not just thoughts in your head, or there's a difference between thoughts in your head, motivation, and thoughts in your head, whether you hate. Hate is irrelevant, motivation is not. Okay, so in order to combat that, I asked myself, is there any place where you could yell, fire in a crowded theater, and everyone would see that this is reasonable? Well, not everyone, but these people of our ilk might see this as reasonable. And what I came up with was the SM Club, sadomasochistic club.

12:09Now, you sadomasochist out there, and don't deny it, I know who you are. What you get off on is whippings and stuff like that. But my kind of sadomasochism is we don't go for whippings and manglings or whatever. What we do is we yell fire and then we all crush in a delirious crowd, you know, togetherness. You see, they're laughing at me. We're misunderstood. If you haven't tried it, don't knock it. So why then in the ordinary theater don't we have rushes at the exit? The reason is it's a violation of property rights or implicit contract. When the movie theater sells you a ticket, they're implicitly, and I think correctly, implicitly saying, you know, sit there and shut up and watch the movie and don't make a pest of yourself.

13:00And if there's no fire, don't be yelling fire. So the reason we don't want to have people yelling far in a crowded theater is not because free speech isn't absolute, it's rather because it's a violation of property rights. Look, you have a right to say 2 plus 2 is 4 and to recite the sonnets of Shakespeare, but not in my house at 3 in the morning if I don't want you there. And if Dan breaks into my house as he wants to do and starts reciting stuff at 3 in the morning in the living room, And if I kick him out, it's not that I violated his free speech rights, it's that he's violating my property rights. So free speech rights are part and parcel of property rights, as are most things.

13:45Yeah. Today's situation arises where you're not on a specific someone's land or anything, just two people talking, one person says to the other, Some third party, who I'm not in control of, is going to kill you unless you put money at his plate. How does that interact with the libertarian? Well, for a libertarian, it's really hard to analyze the question when you say, well, they're not standing on any property. What I'm saying is that they're not. Because everyone in the libertarian society, all property is privately owned, and a lot of the analytic framework of the libertarian is, Well, whoever's property is can decide within certain limits what can be said. Now, putting that aside for the moment, if you just report that, you know, Mr. C said that unless you put money here, I don't know, it sort of begs or based on the interpretation, is it a threat? Is it a veiled threat?

14:42You'd have to know the context. This is a tough one, maybe a gray area. But the way that the libertarian analyzes questions is, aha, it has to occur on someone's property, whose property is it? For example, Rothbard, when he analyzes the lifeboat situation, the first question is, who owns the lifeboat? Which sort of cuts to the chase, whereas the way Rand does it, the lifeboat is sort of, well, you just can't say. It's an emergency situation, so all bets are off. And I take the Rothbardian line on this. Let me talk a little bit about, since we're talking about sadomasochistic theater, let me talk about another institution, another favorite institution of mine, which I call Murder Park.

15:29Now, Murder Park is a stadium with walls 20 feet thick, and when you come into the park, you pay your $100 or whatever it is, and you're given a pistol with six bullets, and you're told you can shoot anyone else in the park, Park, because everyone is there on the same basis. But there are rules. There are rules everywhere. Every 50 minutes, a bell rings, and they cart out the dead bodies, and they give new ammunition. And you're not allowed to shoot them because the employees go and do this. And then you have at it again. Now, would such a thing be legitimate? Well, yeah, because you're not invading any innocent people. Everyone who is there is there with the understanding that you can be killed.

16:16I really shouldn't call it murder park. There's no murders take place in it. Justified killings, right? Because everyone is there based on agreement. And the murder park or killing park or death park is a good analytic tool to see how far libertarianism can go in various directions. And I'll be making more use of this as the week goes on. Another point about free speech is the Nazi march in Skokie, Skokie, Illinois, I think it is, where there are a lot of elderly Jewish people who weren't too happy with the Nazis marching around. The problem there, to get back to the point that Prem made, is that it was on a public street.

17:06And for public streets, the analytic framework of the libertarian, it's hard to employ. Well, you know, the Nazis, they're just marching. They're not using violence. They're just doing their goose step. You'll remember my attempt to convert these young Nazis, which didn't work, but what the heck. The problem was that it was a public street. If it was a private street, then the owner would determine it. And maybe the people would boycott him or something if they didn't like his decision. But the reason we have debates and squabbles over free speech is because of the lack of private property. Another example is leafletting in a mall, you know, a shopping mall. Somebody there leafletting, come to the Mises Institute or come to the Catholic Church or whatever it is, it doesn't matter.

17:56Well, should they be allowed to? And the courts have said, yes, free speech rights, you know, you should be able to leaflet. You can't leaflet in my house without my permission. The shopping mall is private property. Now, what they say is that it's open to the public, but it's not really open to the public. It's only open to the public that they want there. And if they don't want leafletters, then they shouldn't have to have leafletters. And if they don't want women or men or blacks or Jews or bald people or hairy people or whatever it is, They should be able to prohibit anyone from entering there, because we have part and parcel of the libertarian laws, the freedom of association. You should only associate with people that you want to.

18:45And don't worry about people who are discriminated against, because when they're discriminated against, other people will make profits by serving them. In my own case I happen to be Jewish and you know there used to be signs no dogs or Jews allowed here and the answer is well we're not welcome there we don't have to go there someone else will set up a place where we can go whether they're Jewish or not it doesn't matter because we'll be willing to pay more now because we can't we don't have much choice so you can make more money and the guys who service the minority group can make extra profit and drive out the discriminators so the economics of discrimination Discrimination is such that he who discriminates is likely to lose money.

19:32John?

19:38Okay, the next one is the dishonest cop. And this only applies in the cases of unjust law. And it also applies in North Korea and Cuba. And it doesn't apply in the US or Canada or any country that I'm likely to visit. And it applies if the law is unjust. Take the Nazi concentration camp guard or the vice squad member who is penalizing people for sexual acts against adults, pornography or prostitution. There are four things that can happen. The first one is an outright violation of the law, let the victimless criminal go.

20:24The cop should turn a blind eye on it. There's a friend of mine, a lawyer in Phoenix, he was offered a judgeship. And it was a problem for him, because he knew that he would have drug cases and sex cases, and he's a staunch libertarian. And so what should he do? Should he take the job and then what? Let all victimless criminals go? Well, that's one possibility. Of course, he'd be fired pretty quickly. Another one is take the job and let half the victimless criminals go and put the other criminals in jail on the ground that better him than anyone else who's putting them all in jail.

21:09These are problems, real life problems that real life individuals have to face because of their philosophy. Or should he write a letter saying, I'll take the judgeship, but just give me rape cases or contract cases, don't give me any victimless crime cases. That's what he decided to do. And the judge said thanks, but no thanks. So he didn't have that problem. are real-life problems that people have who have our philosophy. Okay, so the best thing to do is to let the criminal go. He isn't, of any libertarian, even though he's guilty of a crime on the books, the crime on the books is wrong. So let the drew out of the concentration camp. Let the pornographer go free. Let the drug dealer go free. They are not guilty of a crime.

21:57And the libertarian law is above man-made law. Second best is to accept a bribe to free the person. Better to let him go with a bribe than to put him in jail. Because if he bribes, then he values his freedom more than the cost of the bribe, so there's mutual benefit. Third is to demand a bribe, namely extortion, because you're now demanding payment for something you have no right to do, because the only right you have is to let him go. But better to extort a bribe and let him go And the worst thing is to uphold the law, namely put him in jail. That's my analysis of the dishonest cop.

22:45While I'm on the subject of dishonest cops, I'd like to broach the subject of the proper relationship of the libertarian and the state. It's an interesting question that's sort of peripheral, but not unrelated to this issue. How should we deal with the state? Should we be pure and not use the government roads? How did you people get here? Did you use the government roads? Well, are you not libertarians? I don't think so. I think that we have a right to use the roads. Not because we paid for them, or rather not just because we paid for them, because if I came down from Mars, and I never paid taxes before this, and I wanted to use the government road, I don't think I'd be guilty of stealing. My source for this is my man, Ragnar Danishkold, from Atlas Shrugged.

23:34Remember what good old Ragnar did? He would, I was going to say steal, but you can't steal from a thief. He would liberate or take government that is illegitimate government, not like the U.S. or Canada or any other country I'm going to visit. But, you know, illegitimate, we're always assuming illegitimate governments because a legitimate government like the U.S. or Canada or any other place I could visit, This doesn't apply. Don't ask why not. So the point is, certainly the fact that you and your parents have paid taxes for this justify you doing it, but even if they didn't, even if you just came from Mars or from Antarctica or somewhere, you could still use government roads because they stole it. And stolen property is not legitimate property. You can't steal from a thief.

24:24You can only steal from the rightful owner. What about some libertarians, what they do is every time they see a cop, they go, and they call him a pig. And they refuse to pay their income taxes. Well, you know, part of me understands this. I think only a libertarian could understand that. But I think it's very foolish. They've got more guns, they're bigger and stronger. Our comparative advantage is not bearding them in their den, not going like this, haha, you're the state, you're evil. Rather, it is changing the direction in which the sword is pointed or in which way the gun is pointed.

25:09Because we're intellectuals here, we're making an intellectual case against the state. We're writing, we're speaking, we're writing letters to the editor, we're writing articles, we're writing books, we're making speeches. Which is, we're trying to convince the hearts and minds of the people about the libertarian code. It's very foolish to engage in stuff which can't work. Even though I suppose we can appreciate it as few others can, but I think it's very unwise to engage in things like that. Let me talk a little bit about the libertarian Nuremberg trials. That is, one of these days we're going to win, and we might have trials for people who are guilty of things, like, say, perpetrating the minimum wage.

26:01Now look, if I told you that a private individual acted in such a way as to unemployed vast numbers of young people and lead them to lives of crime and then they were real victims, wouldn't you think he's guilty of something? of something? I would. I got into a big debate in the web, the Hayek list. I said, well, you know, I was giving an example of how out of step I was with my colleagues at the time I got my PhD. I remember one of my professors there saying, talking about the minimum wage, and then I said, well, you know, we should get rid of the minimum wage. They said, no, no, no, no, wage and let, keep it flat and let the inflation reduce the real value of it, because the real value of the The minimum wage is the minimum wage divided by a price index, and as the price index rises, the fraction falls.

26:51And I said, the hell with that. Not only should we get rid of it and sow salt where once it stood, but we should put the people in jail. The guy looked at me as if I, you know, a viper in my bosom, you know, where did this guy come from? Sort of how out of step I was from my professors. Well, I think there's a case here for a libertarian Nuremberg trial. Now, of course, any Nuremberg-type trial, you have to first deal with ex post facto law. Ex post facto means declaring stuff illegal that was legal yesterday. And there's a song about a blue tie. Suppose they pass the law saying, anyone who ever wore a blue tie goes to jail.

27:37Even though I'm not wearing one tomorrow, I can go to jail for today's activity. So ex post facto law has a bad press, properly so, because it's used by tyrants, but it can also be used by libertarians, as it was by the Nuremberg trial against the Nazis. The Nazi defense was perfectly legal, not only legal, it was a virtue to put Jews in jail and gypsies and homosexuals because they're vermin, and we have to free the populace from vermin, so what are you getting on our case for? And what the U.S. Nuremberg people said, and I think properly so, is that there's a higher law than Nazi law, and the higher law says you don't do that because human beings, they're not vermin. It's just an empirical dispute. And I say similarly that there's a higher law than the present law in North Korea, Cuba, and just like that.

28:26And when and if we win, we will have a trial. We don't have to have a trial. We could have a truth and justice. Justice and what do they do in South Africa? Truth and Reconciliation. We don't have to have a Nuremberg Trump but we'd be justified in having it and whether we have it or not might depend upon empirical issues like if we had it the whole thing would blow up and we'd be back to tyranny or we'd all die in a bomb attack or something. Maybe we shouldn't have it, I'm not saying we should, but I'm saying if we did, how would it work? Because I think it also sheds light on a whole host of problems. Well, the way I see it, the way I see it is we have to make a chart. I'm big into charts.

29:14And we have the top with the leaders, and over here we have the bottom with the followers. So this would be the leaders. And over here we have things that are okay, would be done in a free society. In a free society, compatible with a free society, and over here we have things that are pure evil, and over here we have some sort of moderate kind of a thing, okay? So for example, okay in a free society would be things like libraries and museums and schools and roads, all of which would be done in a free society.

30:02So, let's put library and education, things like that, and the pure evil would be concentration camps, where there's murder and torture, and in the middle there'd be things like the Fed, and I don't know, what else would be quasi-evil, but not really as bad as a concentration camp, I don't know. Office, FDA, yeah, they're killing lots of people, but not directly. They're killing them either by allowing things like thalidomide or not allowing things that will save people's lives. So the FDA is a real good one. It's not really a concentration camp, but it's not a library either.

30:51Okay, so we have a box here, with lots of categories, and lots of people who are leaders or followers. And now, who do we put in jail? Well, I think we put in jail anyone, maybe a boy. In other words, the guy who's washing out the bathrooms in the concentration camp goes to jail. He doesn't get executed, but he goes to jail. The leaders of it all, you know, we get them good. The leaders of this stuff may be not be executed, serious penalties for them, and the followers go free, and the followers here, but even they have the museum or something, guilty of something.

31:45Well, now where's the minimum wage? I guess the minimum wage is somewhere in here. It's not really death, but some people do die as a result of it. So I would say that the top people in charge of the minimum wage, not the secretary in the labor department, but the chief or the second-in-command or something like that. So I'm not saying where I put the line, but I'm saying that the line slopes downward, sort of like a demand curve if you put it that way.

32:16Okay, enough on the discop and our relationship with the government. Let's talk about the litterer now. I have this cousin in law, I don't know what it is, cousin, my wife's cousin, a very sincere guy. And we were standing in the Chesapeake Bay, and he was telling me about how stupid and evil people drop trash into the water, especially like cans of coke, and this is bad because it hurts the fish. I couldn't help myself, I just flipped it over.

33:05Why did I do that? My life was a little tipped off. I probably shouldn't have done that. But what was I doing? What was I protesting? Well, what I was protesting really was that there's something a lot more harmful to fish than cans of coke that hurt them in some way. And what it is that's much more harmful to fish and to the survival of fish... Who's the young gal who's in environmentalism? Oh, there you are. What's much more harmful to them is the tragedy of the commons. And the tragedy of the commons leads to overfishing and possibly to the end of the species. Species extinct. What's with this tragedy of the commons? If I gave you each a can of ______ with a straw, and unbeknownst to you, in the straw was a monitoring device to rate how fast you're slurping it up.

33:57Probably it's an hour, hour and a half lecture, you know, you'd sip it slowly so you make it last at least till the break and then you can get another one. but now suppose I did it in a different way I gave a big bowl of coke in the middle of the room and everyone got a long straw and let's suppose we could abstract from the problems of germs you know sucking in each other's coke or whatever just put that to one side and again we put a monitor to see how fast you'd suck it up what would be the difference in the rate obviously here you'd be sucking it up faster because you're afraid someone else will get it The reason that the, well, I'm sort of getting into my environmental lecture, so I don't want to get into it too heavily now, but the tragedy of the commons is a much more dangerous thing for fish than some can of coke.

34:50How do you get rid of the can? How do you get rid of the can? How do you get rid of the tragedy of the commons? The way you get rid of the tragedy of the commons is by privatizing the ocean. Now, in most places where I say that, there's horror. How dare you, you know, the ocean should be the common heritage of all mankind, says the UN or something. But in this audience, I get away with anything, practically. Well, the only way that we're going to get rid of the tragedy of the commons is to privatize the ocean, and I was doing my bit of privatization. I was homesteading it. It wasn't much, you know, I think Nozick said if you pour, what is it, ketchup into the ocean, do you own, because the ketchup will then spread out, do you own the whole ocean, or just waste your ketchup or something, or some tomato juice.

35:37Well, maybe I was wasting my can of Coke, and maybe I'm not the owner of the Chesapeake Bay, but that was my protest. I was littering. Now, of course, I would never litter on US highways or anything like that, but if I were riding in a North Korean highway and I littered, well, I'm protesting public property. It shouldn't be a government highway. Government highways kill 40,000 people a year. Government highways are highly problematic. We should have private highways, and notice that littering only occurs on public property. You litter here, and at the end of the day, you know, there'll be some peanut shell or some cough drop, courtesy of me, cough drop wrapper.

36:27It's not litter. It's internalized. You know, there's that big football field when they have a game after the game and 50, 80,000 people leave. There's stuff there. But it's not called litter because it's private. You can only litter on public property. Well, we shouldn't have public property. That's the way to end litter. If you don't want litter, let's get rid of public property. As long as we've got public property, this is a protest against public property and it's a legitimate protest. Okay, it's one thing to litter a can of Coke or, I don't know, a cellophane wrapper, how about littering with, as unfortunately is now happening, only sometimes the bombs are attached when I'm not.

37:16I would say that there's a continuum, a gray area between what you can litter and obviously you shouldn't be littering bombs because now you're hurting innocent people. Okay, the pimp in, not in Las Vegas, but in every other county of Nevada beside Las Vegas, prostitution is legal, and they have pimps, and all of a sudden the pimps aren't legal, they're illegal. And all of a sudden the pimps aren't creating violence anymore than people who sell wine or beer or liquor nowadays are committing violence even though they were when alcohol was prohibited.

38:10The genesis of the evil pimp is the fact that prostitution is illegal. If it's legal as it is in Las Vegas, in Nevada outside of Las Vegas and in several European Cities, where they have red light districts. All of a sudden, the business is run in a rational way. No one's being beaten up. There are cleanliness tests. Not the FDA, but private people make sure that the girls or the boys, because you can have all sorts of combinations and permutations here. But the sex trees, as they say, are now clean and well cared for, and the madams or the pimps are just like movie star agents or both, you know, professional ball players have agent and if it was illegal they would beat them up probably but happily basketball and football and baseball are now legal activities so you don't have this, you don't have this problem but if we prohibited it, look, if we prohibited chocolate tomorrow there'd be wars on street corners so what do you mean there's a street corner?

39:13I'm eating chocolate here, you know, and I'll shoot you so it's got nothing to do with the specific thing I mean, chocolate is innocuous now, but wine is innocuous now, but when wine was prohibited, then we're killed over it, as they are now over drugs. The slumlord, usually in the inner cities, they're not ghettos, they're the inner cities, ghettos, the only ghettos that I know of are Jewish ghettos in Germany. A ghetto is a place where you're compelled to live and you can't live elsewhere.

39:58There are no ghettos in the United States, blacks or whoever you think is in the ghetto, It's legal for them to move out. They might not be able to afford it, but that's the definition. When they have parades in the inner city, the slum lord is usually, there's a picture of the slum lord and everyone throws a rock at him, because the slum lord's got rats and lower class surroundings and all. Let me ask, the people that are in those slums, Is the slumlord their benefactor or not? Obviously he's their benefactor because if they had a better option, they would take it. It's very similar to the Kathie Lee Gifford sweatshop where she's employing people and paying them low wages, but that's their best option.

40:48If you take that away from them, they have a worse option. If you take the slums away, they have a worse option. The slumlord is a benefactor. So what do they do? They have rent control Because we've got to control the slumlord. And the latest twist on this is what they do is the courts find the slumlord guilty of slumlording. And you know what the penalty is? Got to spend a month living in the slum, right in the middle of all the tenants. And he gets beaten up. Now, what do you think happens to the supply curve of housing when we institute this wondrous thing? Okay, so here's the supply curve of housing. There's the demand curve of housing. Here's rent and here's the quantity of housing.

41:36And now we institute this new plan that anyone who gets caught with substandard whatever has to live there for a month. Well, obviously the supply curve and the price of housing rises. So how is this hard? It's not. I go so far as to say, not that I advocate this, But if you really want to help the poor in their housing needs, what you should do is have price controls over everything else except housing. You see, if you had price controls over tables and wristwatches and ties and shirts, but not housing, money would leave all those other areas and push into housing, and the supply curve of housing would shift to the right, and housing would be cheaper.

42:25So bad is rent control that the very opposite of rent control, namely controlling everything else but rental housing, would be better for tenants. Now, obviously, I'm not advocating, but I'm just trying to say in a very dramatic way how bad it is. Because right now, suppose Aunt Tilly leaves you a million dollars and you can invest in any area you want. Well, the money will tend to go where the profits are the highest. And now I tell you, but there's one area that if you invest, the government will be after you with price controls and rent controls and inspections and you'll have to go to jail or live in these bad places. What you're really saying is you're putting a light or a stop sign or a yellow light or a red light in front of residential rental housing and you're saying, invest anywhere else, leave this area.

43:17Well, if you leave this area, the supply of it is less, and then the prices are higher. Economic ignorance is invincible, because people actually favor this stuff. There was a New York City case, what happened in New York City, which is sort of the... By the way, where do you have brain control nowadays? Which cities? People's Republic of Santa Monica, Ann Arbor, Cambridge Mass, although they just got rid of Massachusetts Spring Control, the whole state, but if you had had a referendum in Cambridge Mass, you know which way they would vote. Now, what do Cambridge Mass, Ann Arbor and Berkeley Santa Monica have in common?

44:03Big universities. And they have the audacity to say that higher education is an external economy, And we should subsidize it? No, it's a, what do you call it, an external diseconomy. It's a negative neighborhood effect. What we ought to do is tax this stuff. Because what they teach there is just the opposite of economics. Now it's true, most economics departments, with the exception of Cardin Kruger and, you know, Horsetown, places like them all, teach good economics. But, you know, what are they doing in the sociology departments in the Department of Feminist Studies, or Black Studies, or Queer Studies, or History, or any of these other fields, is that teaching rent control is great.

44:48And we've got to have not only a minimum wage, but a living wage of $10 an hour, and $5.50 or $6 is not enough. New York City is the champion of rent control. And what happened there was, do you know the rule or the law that is undergirding rent control in New York City? Anyone know when it came into effect? World War II, 1942, January 1942. The law of January 1942, under which the whole country was rent controlized, said that every two years you have to have a study to send you and it's called the wartime emergency law to prevent the homelessness and here it is 2005 and I once made a study every two years of these studies that purport to show that there's still a housing emergency from World War II which is over a year ago and there were no economists that do these studies. There are sociologists, political Science, somebody ought to do a review essay of all these studies.

45:59Really horrible stuff, you know, they're standing up on their hind legs and saying, yes, we need rent control because of the wartime emergency. So what happened was they noticed, you see, there are several levels of rent control. The pure rent control is rent control. That's it, no exceptions, rent control. But then they noticed something, after World War II, that no one was building residential rental units. Can't understand why. It probably has nothing to do with rent control. It's probably just a coincidence, but nobody was building residential units. They were building everything else under the sun, but not residential rental units. So they decided, okay, we'll have exception. New buildings are exempt from rent control. And if a tenant leaves, they decontrol, you can raise the rents from $22 a month up to the market level.

46:50Then, naturally, landlords became specialists in vacating tenants. See, ordinarily, the incentive of the landlord is to make the tenant comfortable, because, you know, you've got to pay the mortgage and you want to collect rent. But if the tenant is paying $22 a month for a $500 apartment, and there's vacancy decontrol, and the reason there's vacancy decontrol is to encourage, you know, so that they don't get rid of their housing, If there's an NCD control, then you get a different kind of landlord in there, one who is not into giving services, but into making it uncomfortable for tenants so that they'll leave. What happened there was that there was a housing crisis because of rent control, but the politicians in New York City didn't see it that way.

47:42And they decided to have public housing, about which I just spoke from Jane Jacobs. And the reason we had to have public housing is because the market has failed. That is the rent control model. And in order to get into the public housing, which was brand new, you had to be on a waiting list. However, if your house burned down, you got put on the top of the waiting list. Waiting List. And also what happened is that landlords had insured their buildings before rent control for a lot more than the buildings were worth after rent control. And if the buildings burned, get the pre-war value of the houses. So you'll never guess what happened. Burn baby burn. A lot of houses went up in smoke in the South Bronx. I once did a book on rent control and I was trying to I want to illustrate Assar Lindbeck, who is a socialist economist, one of the people in charge of picking Nobel Prize winners.

48:40And he said next to rent control, no, next to bombing, there was nothing as harmful to the city's housing as rent control. So what I did is I tried to get pictures of rent controlled out places in the South Bronx, and places from Hiroshima, Nagasaki and Dresden, which were firebombed. Now, naturally, I had to get rid of any picture that had a black person in there because I wanted to test the readers to see if you could tell the difference. And I had to get rid of any of those pagoda kind of things. And I have a confession. I had to get rid of the worst bombing cases because the worst bombing... See, each chapter had a picture and I wanted to see if people could tell the difference. And bombing really is worse than rent control because bombing, you know, in those cases, it was just nothing.

49:26There's no housing, whereas there's none like that quite in the Bronx. So, it's damaging of the bombing and the most damaging of the rent control. And I illustrated each chapter with a picture. And I had in the back, you know, a code where you could tell the difference. I couldn't tell the difference after a month or two. Rent control is really like bombing. Okay, so one exception was vacancy decontrol. Another exception was new housing. And what happened in New York City, the old rule was if you built at a certain time, you could build on 70% of your land. And then what they did is they changed it and they said, oh no, no, no, the new rule is you can only build on 40% of your land.

50:12But they gave you a grace period, like if you put in a foundation by a certain date, even if you didn't have the building built, you could build under the old 70% rule. So everyone and his uncle started putting in a foundation. And the supply curve of housing in New York City was phenomenal after two or three years when these high rises started to be built. And then what happened is they had a hard time getting tenants in them and they would promise, you know, six months free rent, a year's free rent if you see your lease or a three-year lease. And then what happened is there's no more building because now you're under the 40% rule. And four or five years or six years later after the buildings are built and the first three-year lease comes up and there's been no new build for almost a decade now.

51:05The rent rises were phenomenal, as you can imagine, and we couldn't allow this. So even though the New York City government promised that all new housing would be exempt from rent control, tenants were complaining that the new leases were three-fold. So they came up with this thing called rent stabilization instead of rent control. Now, don't ask me for the difference. Well, there is a difference. Rent stabilization applies to housing built after a certain number of years, and rent control applies to housing built before. It's sort of like the stuff with the new oil and the old oil and the middle-aged oil, and, you know, each oil has a different price, and it's very complex as to know how much oil prices can be.

51:52It sounds a little bit like the Soviet Union economy with all these regulations. So that's the rent control story. The slumlord is a hero. The slumlord is giving people what they want. He's giving them apartments at a low price. He's bettering their situation compared to what it would be had he not done it. Let me do one more before the break. And that's the ticket scalper. Why is the ticket scalper a hero? What's going on with ticket scalping? Well, the usual ticket scalping situation is you have a very fixed supply in the short run.

52:41This is a very short run kind of a thing because the stadium only holds 10,000 seats. That's the quantity of seats and here's the price. And ordinarily, you know, you have some sort of demand curve and the average ticket price is, oh, 20 bucks. But now comes, I don't know, the Beatles or Madonna or somebody comes along and the demand is very, very much higher for this special event. And the market price here would be 500 bucks.

53:23And at the $20 price, there would be, I don't know, 10 million people who would want to get in to see, you know, the second coming of Christ or whatever, you know, there's some important thing that everyone wants to see. So how do you ration the difference between 10 million people and 10,000 people, only 10,000 people can fit into the stadium? Well, one way to ration it is you raise the price to 500 bucks, and then all of a sudden supply equals demand. Okay, we're not at equilibrium, but it tends there. But, yeah, you can't charge 500 bucks. Only the rich could come. We don't want only the rich to come because that would show we're capitalist pigs.

54:10My answer to that one is, you know, what's the point of being rich if you can't buy a Maserati or a ticket for this thing? I mean, the whole idea of being rich is that you get some advantages, and if you get no advantages from being rich, why are you struggling working, you know, 62 hours a day and, you know, working hard and investing if there's no benefit of being rich? But somehow it's evil to have something that the rich can benefit from. You know, the poor should have a shot at the Maserati or the Cadillac. It's unfair that the poor have to have a Volkswagen. I mean, that's very unfair. So anyway, one way is to do that, but we can't do that, because then we would be seen not only be favoring the rich, but making horrors profits.

54:55We're not in business for profits. Profits? Us? No. Profits are evil. We can't be profiteering or gouging. Someone's from Florida here. There was a typhoon or something there, a storm, a hurricane, and people were raising prices on gasoline and milk and water and orange juice and staples that you need when there's a hurricane. And of course, Jeb, Free Enterprise Bush, had us say, This is unconscionable, you can't raise prices, this is gouging, and higher prices have two functions. One, they ration. I mean, if you have 500 people waiting to get into the Walmart, and that's a whole other story about the Walmart, the first few are going to grab it all if you keep the old prices.

55:44So then what you have to do is say only one quart of this to a customer or something, and then you have to watch that. And meanwhile, nobody's coming from Texas and Virginia to bring stuff on. Because, you know, what's the big advantage to them? Whereas if you allow the prices to rise two or threefold, then you ration the extent amount, and also you get new supplies from elsewhere. It's no accident that we don't have deaths due to drought or hurricanes here, because most times you are allowed to have prices to ration. Whereas in Africa, if you have a drought here, nobody's bringing stuff from there, Because the prices are held rigidly, even more so than here. Or, put this the other way around, if this anti-gouging stuff gets to going, we'll become like Africa.

56:34We're a calamity here, and nothing happens, or at least the market can't get government to help because the people are dying. Okay, to get back to the, how do you ration the difference between the demand and the supply? Well, another way is first come first serve. But the problem with that is you're going to wait in line for three days, camping out, and who's going to be doing that? The rich or the poor? Obviously the poor, unless the rich are paying the poor to camp out and buy them tickets. And then what happens is if a poor person gets a $20 ticket and can now sell it for $500, he becomes a scalper. In other words, the scalper is carrying the water for the facility. In other words, the price has got to be 500 bucks, no matter how you slice it, whether it's in money or in time or in anything else.

57:26And the function of the scalper is everyone can blame it on the scalper and the owner of the theater or the facility is no longer blamed. So what the scalper is doing is taking the negative flak for economics. I mean, the fault of it is that so many people want the ticket and there's only so many tickets, only so many seats. That's the cause of the problem, of the rationing problem, and the solution is the tickets, and that's who they're arresting. I'm ready to tell some jokes, so pay attention. This is the most important part of the lecture, the jokes.

58:13Okay, I'll tell the can opener joke. Due to popular demand, shut up, here's the can opener joke. There were three men on a desert island and they had cans of food but no can opener. And there was a physicist, a chemist and an economist. Chad, am I on? Great, okay. Okay, the people out there in radio land got to hear this joke. And the physicist says, what you do is you take the can at the 30 feet high and you drop it on a rock and that'll be just enough physical pressure to open the can and not cause any problem with the contents. And the chemist says, yes, yes, I agree with this in theory, but there's a better way, the chemical way, better way through chemistry.

59:04And what we do is we heat it up to a certain heat, and then it'll open up and the food will be cooked. So it's much better. Whereupon the two of them turn to the economist and say, well, how can you help in our deliberations? And he says, assume a can opener. Dan, you owe me five bucks for that joke. Here's another joke. This is an economic joke and a blonde joke, only this is pro-blonde. A blonde walks into a bank in New York City and asks for the loan officer. She says she's going to Europe on business for two weeks and needs to borrow 5,000 bucks. The bank offices the bank will need some sort of security for the loan, so the blonde hands over the keys for her new Rolls Royce.

59:51The car is parked on the street, she has the title and everything checks out. The bank agrees to accept the car as collateral for the loan and puts it in its garage. The bank's president and its officers all enjoy a good laugh at the blonde for using a $250,000 collateral against a $5,000 loan. Two weeks later, the blonde returns, repays the $5,000 in the interest, which comes to $15. The loan officer says, Miss, we are very happy to have had your business, and this transaction has worked out very nicely. But we're a little puzzled. While you were checked around and found out that you're a multimillionaire, What puzzles us is, why would you borrow $5,000? The blonde replies, where else in New York City can I park my car for two weeks for only $15 and expect to find it when I return?

1:00:42So the blonde wins out. Okay, another chapter is, I think the chapter is entitled, The Denier of Academic Freedom. So what's going on with academic freedom? Well, if academic freedom is upheld, and then professors are to say whatever, they damn well please, pretty much. Now, Hans Hoppe got in trouble with this recently because he was using homosexuals to illustrate a point with regard to interest rates and time preference and saying there are certain people that are more impatient and people are less impatient, more forward-looking if they have children and homosexuals don't tend to have children, therefore homosexuals or a society of homosexuals would have a higher interest rate.

1:01:37Very innocuous stuff, just trying to explain interest rates based on time preferences. Very innocuous, he's given a speech numerous times, we all have, I mean you want to talk interest rates, that's a good illustration. Another one, if the society was concerned, composed of little children. Little children are very impatient. You offer them a choice of one candy bar today or five tomorrow. They grab it because tomorrow doesn't mean anything to them. Some homosexual in his class takes umbrage at this and tells the dean, and then the dean says, you know, Professor Hoppe, you're out of line. You have to shape up. We're going to fine you. We're not going to promote you, whatever it is. And this was a denial of Hans' economic freedom, academic freedom.

1:02:26This was associated with the Mises Institute, Mike Levin, has written books on race and racial discrimination, and got into a lot of trouble with the politically correct people in New York City. And there are numerous cases, and this is group FIRE, Foundation for Individual Rights in Education, that does yeoman work in protecting professors' academic freedom. okay so that's the case for academic freedom that if one professors to be free to make new discoveries to have any spontaneity I'm not reading from notes I don't know what I'm gonna say I'm just sort of let it go like you would in a conversation and God forbid I'll say something that will offend someone I'd never have but you know radically it could happen and the idea is that if I If I don't have the spontaneity, then I'm not going to give an interesting lecture, or I'll give a more interesting lecture if I have the spontaneity.

1:03:22But if you have the spontaneity, then you might say something that offends someone, God forbid. And academic freedom is a way of protecting this and the other class of professors. Okay, the argument against academic freedom is once a year, they go to sleep. You know, they'll read their lecture notes from 20 years ago, and they'll not do any more research or publication. They'll just be on welfare. And they'll be doing it, and a lot of us have had professors that are just going through the motions, and it's a horrible situation. So, which is it? Should we have academic freedom, or should we? Or should we have tenure, or not, or what? All these sorts of questions come in together.

1:04:09The answer from the libertarian, getting back to the point that Prem made in a different discussion, is private property rights. The libertarian answer is, let each school be owned privately and let each school determine what it wants. It's very much like the question, should pizza paulers have blue tablecloths or red tablecloths? That's not a libertarian question. The answer is, let each pizza parlor pick whatever tablecloth color they want and whatever else they want, and then people will sort themselves out. And the same thing is, should you have smoking zones or what should the smoking policy be? Let each restaurant determine for itself. You know, some will say, smoke anywhere you want. Other food stores will say, no smoking at all.

1:04:55The moderate ones will say, you can smoke in this section on these days, and you know you can have various rules and then people will sort themselves out on the basis of the king or the tablecloth color or the academic freedom or whatever and that's roughly the answer that I give in the chapter that private universities and let private enterprise the magic of the market sort it out as to what should a public school do the answer is there should be any Public Schools. So there's no problem. But notice that it's an agnostic position. It's sort of like, should the NBA give long-term contracts or not? Well, if you give a long-term contract, you know, the player doesn't have to worry about next year's contract and he can focus on dunking the ball.

1:05:47On the other hand, if you give him a long-time contract, and he breaks his leg, and now you have to carry him, well, you know, should there be long-term contracts on it? What's the libertarian answer? The libertarian answer is there's no answer. Let each team decide what it wants, and that's how it'll shake out. So the way I see it, the denier of academic freedom is perfectly limited. Suppose you get the Bob Jones University, which is a Baptist school or a religious school or a Catholic school or any kind of school, a Mormon school. They don't want to have total academic freedom in Brigham Young University or in Hebrew University or Yeshiva City. They don't want people saying, well, you know, Jews think in Yeshiva University or more crappy in Brigham Young University.

1:06:35They want to have certain amount of academic freedom, but there are certain things you can't do in Brigham Young or Bob Jones, homosexuals, dating, whatever it is. So each school can have whatever rules it wants and then people will go there or not go there based on the fit between the rules and the customers. And in that way we get out from under continual fighting over, you know, should you have a pledge of allegiance or not, or should it be compulsory or not, each one decide. And then, all of a sudden, all the problems go away. Okay, to conclude the coverage of this book, and there are many others, and if people have questions about any of them, I can certainly get into them. What I'm saying is that these are not nice activities, or at least many of them are not.

1:07:23You may not want to summary one of them, but they're not guilty of initiatory violence. They're not guilty of violating private property rights, so they're legitimate. They should be legal. If you prohibit them, if you denigrate them, if you revile them and then they persist, then they're heroic. So that would be my conclusion on defending the undefendable. One of these days I'm going to come up with defending the undefendable too. It's just that I'm so lazy and I've got some shit. The book came out in 76, maybe by 2006, I don't know, 30 years later, I'll come out with a sequel.

1:08:08Well, what I want to do now is hopefully get some questions and discussion. And if I don't, I've got other stuff to stay, but I'd like to... What do you think would defend the violated copyright? Ah, okay, well, that's a very interesting question, intellectual property, of which there is mainly two, patents and copyrights. Now, the key piece that's ever been written on this, as far as I'm concerned, is one by Stefan Kinsella in the Journal of Libertarian Studies. And this, I think, won the award for the best article that year or that two-year period in the JLS. It's a magnificent piece. You absolutely must read it. See, some people accuse me of being an extremist libertarian. I'm not.

1:08:56I believe in full free enterprise, except you have to read this article. If you don't read the article, you go to jail. You see what a moderate I am? I don't adhere closely or totally to the non-aggression axiom. I'm willing to make exceptions. I've grown. I've been in Washington, D.C. I grew, and now you have to read Kinsella's article, and then for the rest, it's laissez-faire. Okay, now to go back a bit before we get into the Rothbard business, the Kinsella business is Rothbard. What was Rothbard's view? Rothbard's view is that patents were illegitimate, but copyrights were legitimate. What's wrong with a patent? What's wrong with a patent is that I have been both working on inventing the wheel or the bicycle or whatever it is, and she beats me to the patent office by five minutes.

1:09:51And she gets the total value of it, and I get nothing. And if you believe in intellectual property, which I don't, but let's assume that you do, just for the moment, well, I'm being cheated out of my labor. I invented the thing independently of her, and let's say we have no question of lying or anything like that. We know, we stipulate that I invented it independently of her. And she beat me by five minutes, and she gets all, and I get none. That's unfair. Second argument is, I own this pen, there's no time period, I'll own this forever, give it to my kid. Whereas with a patent, if Lauren owns the patent for this bicycle, why does it only last 17 years or 27 years? You know, what's with that? You know, you own this forever.

1:10:39And if you really own intellectual property rights, you should own it forever. And any time period is arbitrary. Not that I'm against arbitrary time periods because of continuum problems and age of majority and stuff like that, but still, why should it ever end? No other property right has a time period attached to it. So patents were out, but he thought that copyrights were legitimate because it was based on contract, you know, I'm selling you this book. Here's this book, I'm selling you this book. Here's a better book that I can sell you, better because it's a better example. I sell you this book, but I sell it to you on the proviso that you not resell it, or not recopy it and sell it again, and Rothbard accepted that.

1:11:31Now, Kinsella, before I get into that, I just want to say one word about Rothbard. I don't know if I'm repeating myself or not, but it's worth repetition if I am. There are some gurus, geniuses, who if you cross them, they hate you. If you prove them wrong, they don't like you. Murray Rothbard wasn't like that. Murray Rothbard had a genesis of libertarianism, and he based it on the common law. When Hans Hoppe came up with what was a better way of looking at it, the argument, and Hans was Murray's student, not formally, but in effect, He was his student, Murray was his mentor, as he was mine. Murray didn't say, oh, Hans, you're out of the movement, or something like that. He embraced it. He embraced Hans' spirit.

1:12:16He congratulated him for it, and he defended the idea. I think Kinsella came after Rothbard died. I'm not sure. No historian. But I know that if Murray, he might have agreed or disagreed, but he certainly would have been welcoming disagreement, as I try to emulate Murray and welcome disagreement with me. Okay, so what's going on with copyright? Consola's point is that the only time you can have property rights, the only justification for property rights, is scarcity. The reason we need property rights is we've got scarcity. If stuff came down from heaven and everybody, you know, you want a pen, you just sort of think a penance and there was no scarcity, there'd be no need for property rights, because property rights are the way of stopping disputes. Well, ideas, once they're known, are no longer scarce.

1:13:09One girl puts her hair up in a ponytail. Girl A puts her hair up in a ponytail. And girl B looks at it and says, hey, that's a good idea, I'll put up my hair in a ponytail. What did girl 2 steal from girl 1? She didn't deprive her of a ponytail. Girl A can still have a ponytail. She didn't take them. She took her idea, but you can't own an idea because an idea is not scarce. Another reputation of this, and here is an empirical type reputation, not a principle of one pack, all grist of the mill. If we really took seriously ideas that you own your intellectual creations, we couldn't can speak language because every word was invented by some caveman somewhere and if we take the God's eye view and we can know exactly who did what, you know, Dan's great-great caveman grandfather invented the word finger, Nick's invented shirt.

1:14:16Each word came into existence from someone, and therefore every federal word you have to find their heirs and give them a nickel or bond them. We couldn't speak. Now it's true that there are certain things that are copyrightable and other things are not copyrightable. But that's just the law. We're now talking principle. The principle is you can't own ideas because ideas are not scarce. Okay, then Kinsella deals with the empirical, if we didn't have copyrights in things, especially like pharmaceuticals and music and books, we wouldn't have enough of them, we'd have much less of them because the only reason I would write this book is that, you know, I can sell it to you and if you could put your name on the cover and sell it, you'd be cheating me out of stuff, right?

1:15:15And if the only reason I'm religion R&D and pharmaceuticals is because when I invent the cure for cancer, I'll make out like a bandit for a while, for as long as my patent or copyright holds out. Well, what Kinsella says is good scares. You can always have enough of something. And what's the optimal amount of research and development? Development, is the optimal amount of research and development 100% of GDP and we all die of starvation because we got all of our money in R&D? No. So we know that 100% of GDP is not the right amount of R&D. And what Kinsella says is that the right amount of R&D is the amount of R&D that would emanate given proper law.

1:16:03Now he says, would it be much, much less? And his answer is no, it wouldn't be much, much less. There are ways that you can benefit from creating an intellectual product indirectly. For example, I make up a song. Zip-a-dee, doo-dah, zip-a-dee. You don't want to hear me sing, because the audience... Well, in any case, I invent the doo-dah song. I won't sing it to you, unless you misbehave, and then I can get you by singing at you and what happens is you can download this and pass it among yourselves and therefore I don't get the money that I would get for it. However, if you want to have a concert, who are you going to invite to sing it?

1:16:49You need the original singer because I can do it best because it was my song. So in effect, all you downloaders, what you're doing is being my agent. You're You're shifting the demand curve for my services as a singer out to the right. You see that? When Betamax or what do you call those things where you have a movie and you go to blockbusters? VCRs. When VCRs first... Look, eventually I'm going to be drooling. You're just lucky that you got me before. I'm getting old you forget you know I can put my pants on still it's not all bad when VCRs first came out everyone thought there'd be no more movies because you know why I go to a movie and pay six eight or ten bucks per person when you go to a VCR blockbuster and pay three dollars and get it fifteen of your best friends and all watch it in the comfort of your own home and you can stop the The movie comes out, the VCR doesn't come out for a couple of weeks or a couple of months and everyone wants to see the movie and it's an experience to see it and be seen or whatever, and not only are movies still there, but movies are even more doing better because the interest comes from the VCR, people want to see it, they want to see it, they want to see it, they want to see it, they want to see it, they want to see it, they want to see it.

1:18:21Similarly, when soft-cover books first came out instead of hard-cover books, everyone thought nobody would be reading a hard-cover book anymore because the soft-cover book is $6 or $8 and the hard-cover is $30, but it didn't happen because the soft-cover book comes out six months later or a year later and everyone's got to have Harry Potter. Harry Potter just came out and it's time, but you know that Harry Potter will be around in softcover in a year or so. So what are you buying it now? Because you value the time. So if you come up with a cure for cancer, by the time you people can, what is it called, reverse engineer it, figure out the formula for Coca-Cola or something like that, I'll be making a ton of money.

1:19:14Maybe less than if I had a patent or a copyright, but still I'll be making a ton of money, so that the amount of R&D won't sink to zero, it'll sink to the optimal amount, the optimal amount being the amount that occurs when the laws occur, as opposed to some arbitrary amount when the laws are incorrect. The coup de grace, I think that Kinsella is the following, here's the scenario, the railroad is coming through town, we all live in the sticks, an acre of land is worth $10 because it's Booneyville, But when the railroad comes through, Faker will be worth $10,000. I know this. I'm the only one in town that knows it. But Maximilian, the dirty rat, breaks into my house and steals the idea.

1:20:05Now, he's a bad guy. He's a trespasser. We know he goes out. But what he does is he tells all of you. And now I come along and I say, hey, I'll buy all your land for 10 bucks, or 11 bucks. Now, if there was ownership of ideas, I rightful owner of that idea, he stole it to you. If he's to you, I could then come and collect it. So if ideas were really ownable, I could come and collect that information from you, namely, sell you the land. Do you have to sell it to me for $11?

1:20:42Well, this is silly. I can't own stuff in your head, even though it came to you illegitimately. So what Consola says is that if there were really ownership in land, ownership in ideas, you would have to sell me your land for the price that Maximilian stole the idea, which is just outright silly. So this is his case, and I think I'm just sort of hitting the tip of the iceberg of it. I hope I'm doing justice to this. I think I am. I'm certainly a fan of it. And that would be the five-minute answer to the IP question. Yes. When you were saying that you can't steal from a thief, and we were talking about the roads, well, certainly someone can't just come in and build some sort of structure blocking the interstate.

1:21:36It seems like that would be a violation of the rights of a lot of the other people too. Because even though, yeah, this road was built with illegitimate money, you know, we all have used it and we, in some sense, homesteaded at least a use of it. Well, there are really two questions that are intellectually separable. One is, should roads be privatized? And the other is, how? and what you're really talking about is how, you know, should we seize the street and set up a roadblock and, you know, that would be highly problematic. I don't think that would be the best way to go about it. A much better way would be to try to find it for loners. Rightful owners are proportionate to the taxes that you paid.

1:22:22And it's very difficult because there are different roads and, you know, even with a God's eye view, it's a big mishmash. Mishmash, but give or take the idea that we set up a stock company for the Route 66. It's owned by, let's say, that's a national road. It's owned by everybody. Well, everyone gets one share and now we have a corporation called Route 66. Or Magnolia Street. Well, who owns Magnolia Street? Well, the Rockwell, the Mises Institute should own a proportion of that road in proportion to the frontage on the road, The road half, because the other guys own the other half, and you should have the Magnolia Street Corporation and that would be a much more sensible way than grabbing it and setting up a roadblock and all of a sudden traffic can't move.

1:23:10Kevin? This is similar, but I don't know if you remember about a few years ago, Roger Long gave a paper about public property and libertarians. I'm going to talk about this, and I'll give you two kinds of examples. One, I guess I'll just use an example from my home town of Fairhope where there's an old Georgia colony and basically the Fairhope Single Tax Corporation, which owned the land, gave a park to, I think it goes, to all the citizens of Fairhope for all of eternity. And basically this is like sort of open to people as a kind of public property. And the other kind would be something that people homestead, but it takes a very large number of people and how people don't do it intentionally like on Silk Road where people just start traveling back and forth and just go on.

1:23:55An actual change in the place caused by a constantly different group of people. The idea is that there are orderly conditions that people from outside of Faroe come in and try to use the public park that aren't citizens, that they can be excluded, but a property for the citizens of my hometown Road. Like we said, if somebody built something right in the middle of a Silk Road, I think Randy Holcomb had a piece recently, I forget where it was, where he took JLS, where people were sort of walking, and I think what you said is correct, namely the people that walk, and if there are say 300 of them in the town, they're the owners, and it's the ownership, each one owns one 300th of a share of that, and they can then determine, you know, maybe we should make it as a lost leader, Like Walmart doesn't charge for parking, right?

1:24:48Well, maybe this little road doesn't charge for parking so that people can be drawn to the town and do commerce. Or they could save foreigners out, whatever they want. They're the owners of it. But just as nature abhors vacuum, I think libertarian abhors non-private property. And these attempts to get out of non-private property, there's one. The other one is this pure, what is it called, nature preserve where it's untouched by human hands. Well, you know, the hell with the nature preserve. Private property rights are the key. And the nature preserve will just have to have certain people that didn't then turn into a nature preserve, second growth or something, or tough on them. Too bad.

1:25:34One last question. OK. Well, this also relates to when you have a feeling I think there is certainly a case to be made that, for example, if Ben Kilpatrick steals my hat, and then Walter Block decides that he's going to steal a hat from Ben Kilpatrick, the hat still belongs. There was an example with the Rhodes that Indiana's response to Tom Kane illustrated that. But I wanted to also ask another question. When do you think it's okay for a third party, Walter Block, vigilante, to go and confront Ben Kilpatrick and take the hat and presumably restore the hat to me? Boy, I got one minute left. That's a toughie. Let me give you the 30-second answer.

1:26:36First of all, I can't steal it from Ben, because he's a thief. He's not the legitimate owner of it. I can only take it from him. Yeah, but I'm not stealing it. I'm taking it, or liberating it, or transferring it from him to me. Stealing, I think, the way the word works, into philosophy of language will correct me if I'm wrong on this, stealing can only be done from the original rightful owner, which is you. So he's a thief. He stole it from you. I took it from him. and now I'm trying to return it to you. So I didn't steal it from him. Second point is the law, the common law about salvage.

1:27:18What happens is if you lose a boat, you abandon ship and you take off in the life preserver or whatever. And now the boat sinks and I salvage it and bring it back to port. Who was the rightful owner of that boat? It's not exactly the hat, but it might shed light on it. And my understanding of the ruling from the private admiralty courts was that the rightful owner, the original owner, gets two-thirds of the value of the boat, and the salvager gets one-third of the value of the boat. Now, how do they come up with two-thirds and one-third? Should it be 60-40? Should it be 70-30? I'm not going to argue with that. All I can say is that it came from a legitimate set of private courts determining this. So as a libertarian, I would accept that bit of common law.

1:28:05Now, to get closer to a question you asked, did the loser of the vote have to commission someone to go out and salvage? No. Anyone could go out and salvage the boat. So I would say anyone could go to Ben and give it back to you. Unless you said, you know, I'm a pacifist, or I don't believe in using violence against people, I believe in thieves and I'm now giving it to Ben, in which case then Ben is the rightful owner even though he came by it through an improper process originally. We're out of time but great question and what I'm going to do is use this at the beginning of one of the other sessions to try to talk more about it. Thanks for your time.