1 00:00:01,100 --> 00:00:05,900 The argument for free markets, morality bursts efficiency by 2 00:00:05,900 --> 00:00:07,900 Walter E. Williams. 3 00:00:07,900 --> 00:00:11,300 Freedom can be preserved. Only if it is treated as a 4 00:00:11,300 --> 00:00:15,400 supreme principle, which must not be sacrificed for any 5 00:00:15,400 --> 00:00:18,600 particular Advantage, quote by F A Hayek. 6 00:00:19,800 --> 00:00:23,900 Freedom's, first principle freedoms, first principle is 7 00:00:23,900 --> 00:00:28,200 each person owns himself, the transition from socialism to 8 00:00:28,200 --> 00:00:31,100 capitalism, and the preservation of capitalism. 9 00:00:31,300 --> 00:00:34,300 Require what philosopher? David Kelly calls the 10 00:00:34,300 --> 00:00:38,700 entrepreneurial outlook on life, which he describes in part, as a 11 00:00:38,700 --> 00:00:41,300 sense of self ownership, a conviction. 12 00:00:41,400 --> 00:00:45,400 That one's life is one's own. Not something for which one must 13 00:00:45,500 --> 00:00:49,400 answer to some higher power once we accept self-ownership. 14 00:00:49,700 --> 00:00:54,800 As a first principle, we readily discover, what constitutes just 15 00:00:54,900 --> 00:01:00,400 and unjust conduct. Unjust conduct is simply any 16 00:01:00,400 --> 00:01:04,000 conduct that violates an individual's property rights in 17 00:01:04,000 --> 00:01:08,100 himself, when he himself, has not infringed upon the property 18 00:01:08,100 --> 00:01:11,000 rights of another. Therefore, acts like murder. 19 00:01:11,000 --> 00:01:14,800 Rape and theft, whether done privately or collectively are 20 00:01:14,800 --> 00:01:17,500 unjust because they violate private property. 21 00:01:18,000 --> 00:01:21,200 There is Broad consensus that government-sponsored, murder and 22 00:01:21,200 --> 00:01:24,600 rape are unjust. However, not as much consensus 23 00:01:24,900 --> 00:01:27,700 is reached regarding theft theft be. 24 00:01:27,900 --> 00:01:32,000 Defined as forcibly taking the rightful property of one person 25 00:01:32,100 --> 00:01:36,300 for the benefit of another. For individual freedom to be 26 00:01:36,300 --> 00:01:39,200 viable. It must be part of the shared 27 00:01:39,200 --> 00:01:42,800 values of a society and there must be an Institutional 28 00:01:42,800 --> 00:01:48,000 framework to preserve it against encroachments by majoritarian or 29 00:01:48,000 --> 00:01:52,400 government will. Constitutions and laws alone. 30 00:01:52,500 --> 00:01:56,700 Cannot guarantee the survival of personal freedom as is apparent, 31 00:01:56,700 --> 00:01:59,900 where western-style constitutions and laws have been 32 00:01:59,900 --> 00:02:03,200 exported to countries not having a tradition of individual 33 00:02:03,200 --> 00:02:06,600 Freedom. Us articulation of the right to 34 00:02:06,600 --> 00:02:09,000 individual. Autonomy is found in our 35 00:02:09,000 --> 00:02:12,300 Declaration of Independence. We hold these truths to be 36 00:02:12,300 --> 00:02:15,300 self-evident. That all men are created equal 37 00:02:15,500 --> 00:02:19,000 that they are endowed by their creator with certain unalienable 38 00:02:19,000 --> 00:02:22,600 rights, that Among these are life, liberty and the pursuit of 39 00:02:22,600 --> 00:02:26,300 happiness. That statement which played such 40 00:02:26,300 --> 00:02:28,900 an important role in the Rebellion against England. 41 00:02:29,000 --> 00:02:32,500 And in the establishment of the US Constitution was the 42 00:02:32,500 --> 00:02:36,900 outgrowth of libertarian ideas of such thinkers as John Locke 43 00:02:37,200 --> 00:02:40,100 Montesquieu and Sir, William, Blackstone. 44 00:02:41,400 --> 00:02:44,500 Even in societies with a tradition of Freedom such as the 45 00:02:44,500 --> 00:02:47,600 United States, the value supporting that freedom have 46 00:02:47,600 --> 00:02:51,200 suffered erosion and have proven an insufficient Safeguard 47 00:02:51,300 --> 00:02:55,400 against encroachment by the state as is so often the case 48 00:02:55,500 --> 00:02:59,900 political Liberty, democracy has been used to redistribute income 49 00:02:59,900 --> 00:03:02,300 and wealth. The redistribute of State in 50 00:03:02,300 --> 00:03:07,000 turn has had a stifling effect on economic Liberty and has 51 00:03:07,000 --> 00:03:11,600 reduced individual freedom. Ultimately the struggle to 52 00:03:11,600 --> 00:03:14,900 achieve and preserve Freedom must take place in the habits 53 00:03:14,900 --> 00:03:20,300 and minds of individuals and as admonished by the Constitution 54 00:03:20,300 --> 00:03:23,700 of the state of North Carolina Article 1 Section 35, the 55 00:03:23,700 --> 00:03:26,700 frequent reference to fundamental principles is 56 00:03:26,700 --> 00:03:30,800 absolutely necessary to preserve the blessings of liberty. 57 00:03:31,300 --> 00:03:34,400 It is those fundamental principles that deliver economic 58 00:03:34,400 --> 00:03:37,700 efficiency and wealth, not the other way around. 59 00:03:38,800 --> 00:03:42,600 Fundamental moral principles or values, are determined in the 60 00:03:42,600 --> 00:03:46,900 arena of Civil Society value such as Thrift hard, work, 61 00:03:46,900 --> 00:03:50,400 honesty, trust, and Cooperative Behavior based on shared Norms, 62 00:03:50,600 --> 00:03:54,700 are the key to improving The Human Condition and provide the 63 00:03:55,100 --> 00:03:57,800 undergirding for a free market economy. 64 00:03:58,400 --> 00:04:01,800 Just as important are such social institutions, as respect 65 00:04:01,800 --> 00:04:06,000 for private property, sanctity of contracts, educational 66 00:04:06,000 --> 00:04:08,400 institutions, clubs Charities, churches. 67 00:04:08,600 --> 00:04:12,200 Is and Families. All of those institutions 68 00:04:12,200 --> 00:04:15,200 provide the glue to holds Society together in terms of 69 00:04:15,200 --> 00:04:19,100 common values and provide for the transmission of those values 70 00:04:19,100 --> 00:04:23,700 to successive generations to often informal institutions and 71 00:04:23,700 --> 00:04:27,500 local networks are trivialised and greater favor is given to 72 00:04:27,500 --> 00:04:31,300 the intellectuals narrow conception of what constitutes 73 00:04:31,300 --> 00:04:35,700 knowledge and wisdom. The importance of informal 74 00:04:35,700 --> 00:04:38,300 networks. Such as friends church members, 75 00:04:38,300 --> 00:04:41,300 neighbors and families cannot be underestimated. 76 00:04:41,400 --> 00:04:44,500 As demonstrated. In the following example of 77 00:04:44,500 --> 00:04:49,000 small proprietorships, the critical determinants of a 78 00:04:49,000 --> 00:04:52,800 proprietor success. Our perseverance character, 79 00:04:52,800 --> 00:04:56,400 ability, and other personal characteristics Banks. 80 00:04:56,400 --> 00:04:59,700 Seldom Finance the establishment of such business. 81 00:04:59,800 --> 00:05:02,200 Most small businesses are financed through friends and 82 00:05:02,200 --> 00:05:06,500 family the And is that those are the people who have the lowest 83 00:05:06,500 --> 00:05:10,200 cost in acquiring the necessary information about the 84 00:05:10,200 --> 00:05:14,300 Proprietors characteristics, deemed critical for Success. 85 00:05:14,600 --> 00:05:18,300 Also, friends and family, who lend the proprietor money. 86 00:05:18,300 --> 00:05:22,400 Have a personal stake in the business and have an incentive 87 00:05:22,500 --> 00:05:26,800 to moderate, their likely bias in favor of the borrower. 88 00:05:28,000 --> 00:05:31,600 Clearly a formal lending institution could query friends 89 00:05:31,600 --> 00:05:33,700 and relatives. However, the information 90 00:05:33,700 --> 00:05:37,000 obtained would have greater bias because friends and relatives 91 00:05:37,000 --> 00:05:40,600 would not have sufficient stake in the business to offset any 92 00:05:40,600 --> 00:05:43,400 personal bias. They had in favor of the 93 00:05:43,400 --> 00:05:47,500 borrower. Institutions and wealth, fa 94 00:05:47,500 --> 00:05:51,800 Hayek refers to the rules of several property, determined by 95 00:05:51,900 --> 00:05:56,600 traditions and values. Those rules consisted in what 96 00:05:56,600 --> 00:06:01,100 David Hume called, the stability of possessions transference by 97 00:06:01,100 --> 00:06:04,900 consent and the keeping of promises Nations that have 98 00:06:04,900 --> 00:06:07,200 respected. The rules of several property 99 00:06:07,400 --> 00:06:10,600 have produced, social and economic climates far more 100 00:06:10,600 --> 00:06:12,900 conductive to the welfare of their citizens. 101 00:06:13,100 --> 00:06:16,400 The Nations who have failed to Tact property rights. 102 00:06:17,700 --> 00:06:20,800 People in countries with larger amounts of economic freedom, 103 00:06:21,100 --> 00:06:24,800 such as the United States Canada Australia, Hong Kong, Japan and 104 00:06:24,800 --> 00:06:28,600 Taiwan are far richer and have greater human rights 105 00:06:28,600 --> 00:06:31,300 protections. Then people in countries with 106 00:06:31,300 --> 00:06:35,700 limited free markets, such as Russia, Albania China, and every 107 00:06:35,700 --> 00:06:39,500 country in Africa. The role of private property and 108 00:06:39,500 --> 00:06:41,800 free markets in. Creating wealth is often 109 00:06:41,800 --> 00:06:45,400 overlooked factors such as natural resource endowment, 110 00:06:45,400 --> 00:06:49,500 population size and previous conditions, colonialism are 111 00:06:49,500 --> 00:06:53,800 claimed to explain wealth yet. Those factors cannot explain 112 00:06:53,800 --> 00:06:56,700 human betterment. The United States and Canada 113 00:06:56,900 --> 00:07:00,100 have relatively small populations, abundant national 114 00:07:00,100 --> 00:07:03,900 resources and are wealthy. However, if low population 115 00:07:03,900 --> 00:07:07,500 density and abundant natural resources were adequate, 116 00:07:07,700 --> 00:07:10,500 Explanations of wealth. One would expect the former 117 00:07:10,500 --> 00:07:15,300 Soviet Union and countries on the continent of Africa and 118 00:07:15,300 --> 00:07:18,900 South America to be wealthy. Instead, the former Soviet Union 119 00:07:18,900 --> 00:07:22,100 Africa and South America are home to many of the world's 120 00:07:22,100 --> 00:07:24,500 poorest and most miserable people. 121 00:07:25,700 --> 00:07:29,700 A history of colonialism is often given as an excuse for 122 00:07:29,707 --> 00:07:32,800 poverty. But that is a bogus hypothesis. 123 00:07:32,800 --> 00:07:36,600 The world's richest country. The United States was formerly a 124 00:07:36,600 --> 00:07:40,800 colony Canada, Australia and New Zealand were colonies and Hong 125 00:07:40,800 --> 00:07:43,400 Kong remains a colony, a far better. 126 00:07:43,400 --> 00:07:46,500 Explanation of wealth are the values and traditions that 127 00:07:46,500 --> 00:07:49,500 produce the rules of several property. 128 00:07:49,500 --> 00:07:54,300 Economics, is not an independent variable, whose laws are 129 00:07:54,300 --> 00:07:58,400 unaffected by the Institutional framework, within which it 130 00:07:58,400 --> 00:08:03,400 operates, economic efficiency is a byproduct of pre-existing 131 00:08:03,600 --> 00:08:09,300 cultural and moral norms. The intellectual defense of 132 00:08:09,300 --> 00:08:13,500 Liberty, all too often Defenders of free market, capitalism base. 133 00:08:13,500 --> 00:08:16,800 Their defense on the demonstration that capitalism is 134 00:08:16,800 --> 00:08:20,500 more efficient in terms of resource allocation, and hence 135 00:08:20,500 --> 00:08:23,700 leads to a larger bundle of goods, then socialism and other 136 00:08:23,700 --> 00:08:26,900 forms of statism. However, as Milton Friedman 137 00:08:26,900 --> 00:08:31,100 frequently points out economic efficiency, and greater wealth 138 00:08:31,100 --> 00:08:34,400 should be promoted as simply a side benefit of free markets. 139 00:08:34,700 --> 00:08:37,100 The intellectual defense of free market capitalism. 140 00:08:37,299 --> 00:08:40,400 Them should focus on its moral superiority. 141 00:08:40,700 --> 00:08:43,500 In other words, even if free enterprise were not more 142 00:08:43,500 --> 00:08:45,900 efficient than other forms of human organization. 143 00:08:46,200 --> 00:08:50,400 It is morally Superior because it is rooted in voluntary 144 00:08:50,400 --> 00:08:55,400 relationships rather than force and coercion and it respects the 145 00:08:55,400 --> 00:09:00,300 sanctity of the individual. The wealth created by free 146 00:09:00,300 --> 00:09:04,200 market capitalism also cultivates Civil Society, for 147 00:09:04,200 --> 00:09:07,900 most of human history, individuals have had to Simply 148 00:09:07,900 --> 00:09:12,400 eke out a living with the rise of capitalism and the 149 00:09:12,700 --> 00:09:17,300 concomitant rise in human productivity, people were able 150 00:09:17,300 --> 00:09:20,900 to satisfy their physical needs with less and less time. 151 00:09:21,300 --> 00:09:24,900 Economic progress, made it possible for people to have the 152 00:09:24,900 --> 00:09:28,300 time to develop spiritually and culturally. 153 00:09:29,700 --> 00:09:33,400 The rise of capitalism enabled. The gradual extension of 154 00:09:33,400 --> 00:09:37,700 civilization to greater and greater numbers of people, as 155 00:09:37,700 --> 00:09:40,700 The Wealth of Nations grew people had, the means to become 156 00:09:40,700 --> 00:09:44,200 educated in the liberal arts and to gain greater knowledge about 157 00:09:44,200 --> 00:09:47,800 the world around them. The rise of capitalism enabled. 158 00:09:47,800 --> 00:09:52,300 Ordinary People to attend the Arts, afford Recreation and 159 00:09:52,300 --> 00:09:55,900 contemplate more fulfilling an interesting life activities and 160 00:09:55,900 --> 00:09:58,600 engage in other culturally enriching activities. 161 00:09:58,800 --> 00:10:04,400 That Formerly only within the purview of the Rich D. 162 00:10:04,400 --> 00:10:12,900 Mystification of the state AV dicey 1914 page, 257 wrote The 163 00:10:12,900 --> 00:10:15,800 Beneficial effect of State intervention, especially in the 164 00:10:15,800 --> 00:10:19,000 form of legislation is direct immediate. 165 00:10:19,000 --> 00:10:24,300 And so to speak visible whilst its evil, effects are gradual 166 00:10:24,300 --> 00:10:27,600 and indirect and lie outside our site. 167 00:10:27,600 --> 00:10:31,200 Hence, the majority of mankind. Kind must almost of necessity, 168 00:10:31,300 --> 00:10:34,100 look with undue favor upon government intervention. 169 00:10:35,100 --> 00:10:40,400 This natural bias can be counteracted only by the 170 00:10:40,400 --> 00:10:44,900 existence in a given Society of a presumption or Prejudice in 171 00:10:44,900 --> 00:10:48,500 favor of individual liberty. That is of laissez-faire. 172 00:10:50,100 --> 00:10:53,700 One can hardly determine the casualties of War simply by 173 00:10:53,700 --> 00:10:57,200 looking at survivors. We must ask what happened to 174 00:10:57,200 --> 00:11:01,700 those whom we do not see. Similarly when evaluating 175 00:11:01,700 --> 00:11:06,400 intervention is public policy. We cannot evaluate it simply by 176 00:11:06,400 --> 00:11:10,500 looking at its beneficiaries. We must discover its victims. 177 00:11:10,600 --> 00:11:13,800 Most often. The victims of public policy are 178 00:11:13,800 --> 00:11:17,200 invisible to Garner greater public support against 179 00:11:17,200 --> 00:11:21,200 government command and Control, we must somehow find a way to 180 00:11:21,200 --> 00:11:26,100 make those victims visible. In all interventionist policy. 181 00:11:26,300 --> 00:11:28,900 There are those who are beneficiaries and those who are 182 00:11:28,900 --> 00:11:30,700 victims. In most cases. 183 00:11:30,700 --> 00:11:34,200 The beneficiaries are highly visible and the victims are 184 00:11:34,200 --> 00:11:36,600 invisible. A good example, is the minimum 185 00:11:36,600 --> 00:11:39,400 wage law. After enactment of an increase 186 00:11:39,400 --> 00:11:42,600 in the minimum wage law politicians accompanied by 187 00:11:42,600 --> 00:11:45,300 television Crews. Readily point to people who have 188 00:11:45,300 --> 00:11:49,400 benefited from the legislation. The beneficiaries are those with 189 00:11:49,400 --> 00:11:52,300 a fatter paycheck. Thus the politician can lay 190 00:11:52,300 --> 00:11:55,600 claim to the wisdom of his legislation that increased 191 00:11:55,600 --> 00:11:57,500 minimum wages. Moreover. 192 00:11:57,500 --> 00:11:59,700 The politician is also a beneficiary. 193 00:11:59,800 --> 00:12:02,700 Since those now, earning higher wages will remember him. 194 00:12:02,700 --> 00:12:06,600 When election time Comes Around by parading minimum, wage 195 00:12:06,600 --> 00:12:10,600 beneficiaries across the stage. Those who oppose minimum wage 196 00:12:10,600 --> 00:12:14,400 increases can be readily portrayed as having a callus 197 00:12:14,600 --> 00:12:17,700 mean-spirited. Disregard for interests of 198 00:12:17,700 --> 00:12:22,100 low-wage workers. A political strategy of those 199 00:12:22,100 --> 00:12:25,600 who support Liberty should be. That of exposing the invisible 200 00:12:25,600 --> 00:12:29,500 victims of minimum wage laws. We need to show those who have 201 00:12:29,500 --> 00:12:32,500 lost their jobs or do not become employed in the first place 202 00:12:32,500 --> 00:12:36,500 because their productivity did not warrant being employed at 203 00:12:36,500 --> 00:12:39,100 the minimum wage. We should find a way to 204 00:12:39,100 --> 00:12:42,900 demonstrate how jobs destroyed by the minimum wage such as 205 00:12:42,900 --> 00:12:46,500 Busboys gasoline, station attendants, and movie Usher's. 206 00:12:46,500 --> 00:12:49,900 We must show how marginally profitable firms have been. 207 00:12:50,000 --> 00:12:53,400 Forced out of business, they'll surviving firms may have the 208 00:12:53,400 --> 00:12:56,400 same number of employees. We should show how Capital was 209 00:12:56,400 --> 00:12:59,900 artificially substituted for labor as a result of higher, 210 00:13:00,000 --> 00:13:03,500 mandated wages and how firms have adjusted their production 211 00:13:03,500 --> 00:13:06,300 techniques in order to economize on labor. 212 00:13:06,600 --> 00:13:09,200 The particular adjustments firms. 213 00:13:09,800 --> 00:13:12,600 Make in response to hire mandated wages are less 214 00:13:12,600 --> 00:13:16,500 important than the fact that adjustments will be made. 215 00:13:17,800 --> 00:13:20,900 A more dramatic example of the invisible victims of 216 00:13:20,900 --> 00:13:25,300 interventionist, State policy can be found in the regulation 217 00:13:25,500 --> 00:13:27,600 of medicines and medical devices. 218 00:13:27,900 --> 00:13:31,600 As in the case of the Food and Drug Administration, FDA in the 219 00:13:31,608 --> 00:13:35,900 United States, essentially FDA officials can make two types of 220 00:13:35,900 --> 00:13:38,300 Errors. They can err on the side of 221 00:13:38,300 --> 00:13:41,200 under caution and approve. A drug with dangerous 222 00:13:41,400 --> 00:13:45,300 unanticipated side effects, or they can err on the side of over 223 00:13:45,300 --> 00:13:47,500 caution. Not approving a useful. 224 00:13:47,700 --> 00:13:51,600 Safe drug or creating costly and lengthy, drug approval 225 00:13:51,600 --> 00:13:55,600 procedures. Errors on the side of under 226 00:13:55,600 --> 00:13:58,800 caution lead to embarrassment and possibly loss of 227 00:13:58,800 --> 00:14:00,900 bureaucratic careers and promotions. 228 00:14:01,000 --> 00:14:04,500 Because the victims of unsafe drugs will be visible through 229 00:14:04,500 --> 00:14:06,900 new stories of sick. People Congressional 230 00:14:06,900 --> 00:14:11,100 investigations and hearings. However errors on the side of 231 00:14:11,100 --> 00:14:14,900 over caution through extensive delay in the approval of drugs 232 00:14:15,000 --> 00:14:19,700 as in the case of propranolol, sir, Peta and Other Drugs, 233 00:14:19,800 --> 00:14:23,300 impose virtually no costs on the FDA big. 234 00:14:23,500 --> 00:14:27,200 Of FDA errors, on the side of over caution are mostly 235 00:14:27,200 --> 00:14:30,700 invisible to the press, the public and politicians. 236 00:14:31,700 --> 00:14:36,000 Those victims should be made visible once the FDA or some 237 00:14:36,000 --> 00:14:39,200 other approving agency. Approves a drug widely used 238 00:14:39,200 --> 00:14:41,700 elsewhere with no untoward effects. 239 00:14:41,700 --> 00:14:45,000 We should find people who died or needlessly suffered as a 240 00:14:45,000 --> 00:14:48,700 result of the fda's delay. For political efficiency. 241 00:14:48,700 --> 00:14:51,300 We cannot simply offer intellectual arguments. 242 00:14:51,300 --> 00:14:55,900 We must get pictures and stories of FDA victims, in an effort, to 243 00:14:55,900 --> 00:14:57,500 appeal, to the sense of fair play. 244 00:14:57,500 --> 00:15:01,500 Decency and Common Sense among the citizenry, but there was 245 00:15:01,500 --> 00:15:04,100 also We Roll for intellectual arguments in the sense of 246 00:15:04,100 --> 00:15:07,800 teaching, people that any meaningful use of safe. 247 00:15:08,100 --> 00:15:12,900 Must see safety as a set of trade-offs, rather than a 248 00:15:12,900 --> 00:15:16,900 category. The attempt to get a safe drug 249 00:15:17,000 --> 00:15:20,000 means that people will die or needlessly suffer during the 250 00:15:20,000 --> 00:15:21,800 time. It takes to achieve greater 251 00:15:21,800 --> 00:15:24,400 safety. That toll must be weighed 252 00:15:24,400 --> 00:15:28,400 against the number of people who might die or become ill because 253 00:15:28,400 --> 00:15:32,500 of the drugs earlier availability, and Ended 254 00:15:32,500 --> 00:15:34,300 unanticipated. Harmful, side. 255 00:15:34,300 --> 00:15:39,100 Effects people should also be taught to understand that if a 256 00:15:39,108 --> 00:15:42,400 hundred percent safe drug has ever achieved, it will be the 257 00:15:42,400 --> 00:15:45,400 only thing in the world. That is 100% safe. 258 00:15:46,800 --> 00:15:49,500 Another area of state interventionism which 259 00:15:49,500 --> 00:15:52,400 particularly applies to less developed Nations is 260 00:15:52,400 --> 00:15:56,300 restrictive, import laws and regulations restricting foreign 261 00:15:56,300 --> 00:15:59,300 imports. As a means to save jobs. 262 00:15:59,400 --> 00:16:03,000 Sounds plausible, adding to the appeal of restrictive trade 263 00:16:03,000 --> 00:16:06,700 policy is the fact that its beneficiaries are highly visible 264 00:16:06,800 --> 00:16:11,900 while its victims are invisible. Using an example of the American 265 00:16:11,900 --> 00:16:15,100 Experience, may suggest a political strategy. 266 00:16:15,100 --> 00:16:19,700 Most people fully understand that import restrictions raise 267 00:16:19,700 --> 00:16:24,300 the cost of products, but may have little understanding of its 268 00:16:24,300 --> 00:16:29,100 systemic effects. Arthur Denso of the center for 269 00:16:29,100 --> 00:16:32,900 the study of American Business, found that voluntary restraints 270 00:16:32,900 --> 00:16:36,500 on imported steel, save nearly 17,000 jobs in the steel 271 00:16:36,500 --> 00:16:39,000 industry. However, the higher steel 272 00:16:39,000 --> 00:16:41,900 prices. Thing from the restraints went 273 00:16:41,900 --> 00:16:46,200 to a loss of 52,000 jobs in American Steel, using 274 00:16:46,200 --> 00:16:50,800 Industries. On balance steel restrictions 275 00:16:50,900 --> 00:16:54,600 led to a net loss of 35,000 400 jobs. 276 00:16:55,000 --> 00:16:56,900 The process is easy to understand. 277 00:16:57,100 --> 00:17:01,500 Caterpillar company uses steel to produce heavy construction 278 00:17:01,500 --> 00:17:07,000 equipment, trade, restrictions caused higher steel prices that 279 00:17:07,000 --> 00:17:11,400 in turn raised caterpillars production costs, higher costs 280 00:17:11,400 --> 00:17:14,800 made caterpillar less competitive in both domestic and 281 00:17:14,800 --> 00:17:19,300 international markets, which led caterpillar to It's labor force, 282 00:17:19,599 --> 00:17:22,599 as a result. We see more Japanese and Korean 283 00:17:22,599 --> 00:17:26,500 produced, heavy equipment in the United States, importing 284 00:17:26,500 --> 00:17:29,800 finished products. By the way, is just another way 285 00:17:29,900 --> 00:17:34,000 to import Steel. In addition, to causing a net 286 00:17:34,000 --> 00:17:36,800 loss of jobs, trade, restrictions are costly to 287 00:17:36,800 --> 00:17:39,300 Consumers. According to estimates, the 288 00:17:39,300 --> 00:17:42,500 Reagan administration's voluntary, import restraints on 289 00:17:42,500 --> 00:17:46,500 Japanese cars, increase the price of Japanese cars sold in 290 00:17:46,500 --> 00:17:51,400 the United States by $900 and increase the price of US cars by 291 00:17:51,400 --> 00:17:58,100 350, for a total cost of the American Consumer of 4.3 billion 292 00:17:58,100 --> 00:18:02,500 dollars that price tag translates into a cost of Two 293 00:18:02,500 --> 00:18:05,900 hundred thousand dollars per year for each job saved in 294 00:18:05,900 --> 00:18:09,700 Detroit. It would have been cheaper to 295 00:18:09,700 --> 00:18:13,600 have given each Detroit Auto worker laid off by Freer trade, 296 00:18:13,900 --> 00:18:17,100 a check for sixty thousand dollars a year so they could buy 297 00:18:17,100 --> 00:18:21,000 a vacation residents in Miami. That way collectively, we could 298 00:18:21,000 --> 00:18:24,800 have been better off to the tune of 140,000 dollars per job 299 00:18:24,800 --> 00:18:27,600 saved. Of course, that policy choice 300 00:18:27,700 --> 00:18:30,800 would not have been politically feasible because the cost would 301 00:18:30,800 --> 00:18:34,700 have been apparent and taxpayers would have refused to pay for 302 00:18:34,700 --> 00:18:37,900 the free vacation. It is not only Auto Workers. 303 00:18:38,100 --> 00:18:39,800 Him. The nation could have made the 304 00:18:39,800 --> 00:18:42,300 trade according to the Federal Trade Commission. 305 00:18:42,500 --> 00:18:46,500 Quotas on textile products from Hong Kong cost consumers 306 00:18:46,800 --> 00:18:50,600 thirty-four thousand five hundred dollars per year for 307 00:18:50,600 --> 00:18:55,200 each job saved for American textile workers earning seven 308 00:18:55,200 --> 00:18:58,100 thousand six hundred dollars to ten thousand seven hundred 309 00:18:58,100 --> 00:19:02,100 dollars annually. Identifying the invisible 310 00:19:02,100 --> 00:19:05,900 victims of trade restrictions may suggest a political strategy 311 00:19:06,100 --> 00:19:10,300 to fight such restrictions one. Such strategy is to organize 312 00:19:10,300 --> 00:19:14,400 companies, adversely affected by import restrictions such as 313 00:19:14,400 --> 00:19:16,900 steel using companies in the case of u.s. 314 00:19:16,900 --> 00:19:23,700 Import restrictions on Steel. Justice process burst results at 315 00:19:23,700 --> 00:19:26,800 the heart of most interventionist policy is a 316 00:19:26,800 --> 00:19:30,800 vision of Justice. Most often this Vision evaluates 317 00:19:31,000 --> 00:19:35,400 the presence of Justice. By looking at results, social 318 00:19:35,400 --> 00:19:39,200 justice has considerable appeal. And as such as used as a 319 00:19:39,200 --> 00:19:42,900 justification for interventionist, statism, there 320 00:19:42,900 --> 00:19:46,900 are several criticisms of the concept of social justice that 321 00:19:46,900 --> 00:19:51,100 Hayek has answered. Bill, but Defenders of personal 322 00:19:51,100 --> 00:19:55,700 Liberty must make a greater effort to demystify the term and 323 00:19:55,700 --> 00:19:59,400 show that Justice or fairness. Cannot be determined by 324 00:19:59,400 --> 00:20:01,600 examining results. The results. 325 00:20:01,600 --> 00:20:04,900 People often turn to, in order to determine the presence or 326 00:20:04,900 --> 00:20:08,800 absence of Justice are educational and occupational, 327 00:20:08,800 --> 00:20:13,500 status income, life expectancy and other socioeconomic factors, 328 00:20:13,800 --> 00:20:16,900 but Justice or fairness cannot be determined by results. 329 00:20:17,300 --> 00:20:22,000 It is a process question. Consider, for example, that 330 00:20:22,000 --> 00:20:25,100 three individuals play a regular game of poker. 331 00:20:25,400 --> 00:20:30,100 The typical game outcome is individual a when 75% of the 332 00:20:30,100 --> 00:20:34,600 time, well individuals, B and C, when 15 percent and 10 percent 333 00:20:34,600 --> 00:20:38,000 of the time respectively by knowing the games result. 334 00:20:38,400 --> 00:20:41,600 Nothing unambiguous can be said about whether there has been 335 00:20:41,700 --> 00:20:45,400 poker Justice. Individual a is 336 00:20:45,400 --> 00:20:48,700 disproportionate. Winnings are consistent with his 337 00:20:48,700 --> 00:20:52,600 being an astute player clever cheater or just plain lucky. 338 00:20:52,600 --> 00:20:56,400 The only way one can determine whether there has been poker, 339 00:20:56,400 --> 00:21:00,800 Justice is to examine the game's process process questions would 340 00:21:00,800 --> 00:21:02,700 include. Did the players play? 341 00:21:02,700 --> 00:21:07,300 Voluntarily were the poker rules, neutral and unbiased Lee 342 00:21:07,300 --> 00:21:09,900 applied was the game. Played without cheating. 343 00:21:09,900 --> 00:21:14,200 If the process were just affirmative answers would be To 344 00:21:14,200 --> 00:21:17,300 those three questions. And there would be poker Justice 345 00:21:17,300 --> 00:21:22,000 irrespective of the outcome. Thus Justice is really a process 346 00:21:22,000 --> 00:21:25,900 issue. The most popular justification 347 00:21:26,000 --> 00:21:30,700 for the interventionist state is to create or ensure fairness and 348 00:21:30,700 --> 00:21:33,100 Justice in the distribution of income. 349 00:21:33,700 --> 00:21:37,400 Considerable confusion, obvious station and demagoguery 350 00:21:37,600 --> 00:21:41,500 regarding the sources of income provide status with copious 351 00:21:41,500 --> 00:21:45,900 quantities of ammunition to justify their redistributionist. 352 00:21:45,900 --> 00:21:51,500 Agenda income is not distributed in a free Society, income is 353 00:21:51,500 --> 00:21:53,400 earned people serving one another. 354 00:21:53,600 --> 00:21:57,500 Through the provision of goods and services generate income. 355 00:21:58,300 --> 00:22:02,500 We serve our fellow man in my RAID ways. 356 00:22:02,500 --> 00:22:06,100 We bagged his groceries teaches children, entertain him and heal 357 00:22:06,100 --> 00:22:10,000 his wounds by doing. So we receive certificates of 358 00:22:10,000 --> 00:22:12,300 performance in the United States. 359 00:22:12,300 --> 00:22:14,400 We call these certificates dollars elsewhere. 360 00:22:14,400 --> 00:22:19,000 They are called pesos Frank's marks again and pounds. 361 00:22:19,000 --> 00:22:23,200 Those certificates stand as evidence proof of our service, 362 00:22:23,200 --> 00:22:27,300 the more valuable our service to our fellow man as he determines 363 00:22:27,300 --> 00:22:29,300 the greater number. Which certificates of 364 00:22:29,300 --> 00:22:33,900 performance we receive and hence the greater our claim on goods 365 00:22:34,000 --> 00:22:38,000 and services. That free market process. 366 00:22:38,100 --> 00:22:42,100 Promotes a moral discipline that says, unless we are able and 367 00:22:42,100 --> 00:22:43,900 willing to serve our fellow, man. 368 00:22:44,000 --> 00:22:48,500 We shall have no claim on what he produces contrast that moral 369 00:22:48,500 --> 00:22:51,600 discipline to the immorality of the welfare state. 370 00:22:51,600 --> 00:22:54,000 In effect. The welfare state says, you do 371 00:22:54,000 --> 00:22:57,300 not have to serve your fellow man through intimidation threats 372 00:22:57,300 --> 00:23:00,000 and coercion. We will take what he produces 373 00:23:00,200 --> 00:23:04,500 and give it to you. The vision That season come as 374 00:23:04,500 --> 00:23:07,800 being distributed, implies a different scenario. 375 00:23:07,800 --> 00:23:12,000 For the sources of income, never made explicit the vision that 376 00:23:12,000 --> 00:23:14,600 sees income as being distributed, differs little, 377 00:23:14,600 --> 00:23:18,300 from asserting that out there. There is a dealer of dollars. 378 00:23:18,500 --> 00:23:20,600 It naturally leads to the conclusion. 379 00:23:20,800 --> 00:23:23,500 That if some people have fewer dollars than others. 380 00:23:23,700 --> 00:23:27,700 The dollar dealer is unfair. He is racist, sexist, or a 381 00:23:27,700 --> 00:23:32,500 multinational list. Therefore Justice and fairness 382 00:23:32,500 --> 00:23:37,000 require a re dealing income distribution of dollars. 383 00:23:38,100 --> 00:23:41,800 That way, the ill-gotten gains of the few are returned to their 384 00:23:42,100 --> 00:23:46,600 rightful owners. That vision is the essence of 385 00:23:46,600 --> 00:23:50,600 the results, oriented view of Justice underpinning, the 386 00:23:50,600 --> 00:23:53,300 welfare state. Side note. 387 00:23:53,300 --> 00:23:58,100 Welfare state doesn't just mean money given to the poor military 388 00:23:58,100 --> 00:24:00,200 industrial complex, welfare state. 389 00:24:00,200 --> 00:24:03,500 The bankers, getting troubled, asset relief, protection money, 390 00:24:03,500 --> 00:24:08,300 welfare state, and so on and politicians and the lobbyists 391 00:24:08,300 --> 00:24:10,900 whatnot. People who criticize the 392 00:24:10,900 --> 00:24:14,500 existing distribution of income as being unfair and demand 393 00:24:14,500 --> 00:24:18,200 government redistribution are really criticizing the process 394 00:24:18,200 --> 00:24:21,000 whereby income is earned. Their bottom line. 395 00:24:21,000 --> 00:24:24,700 Is that millions of Individual decision makers, did not do the 396 00:24:24,700 --> 00:24:27,100 right thing. Consider the wealth of 397 00:24:27,100 --> 00:24:30,600 billionaire, Bill Gates. The founder of Microsoft dates 398 00:24:30,600 --> 00:24:33,300 earned billions, because millions of individuals 399 00:24:33,600 --> 00:24:39,200 voluntarily spent their money on what they wanted his products 400 00:24:39,500 --> 00:24:44,100 for someone to say that Gates is income, as unfair, is the same 401 00:24:44,100 --> 00:24:47,400 as saying that decisions of millions of consumers are wrong 402 00:24:47,500 --> 00:24:51,100 to argue that Gates is income, should be forcibly taken and 403 00:24:51,100 --> 00:24:53,700 given to others. Is to say that somehow third 404 00:24:53,700 --> 00:24:58,500 parties have a right to preempt voluntary, decisions made by 405 00:24:58,500 --> 00:25:03,200 millions of Traders. When sources of income are 406 00:25:03,200 --> 00:25:07,300 viewed more realistically, we reach the conclusion that low 407 00:25:07,300 --> 00:25:10,500 income for the most part is a result of people not having 408 00:25:10,500 --> 00:25:13,800 sufficient capacity to serve their fellow man. 409 00:25:13,800 --> 00:25:17,400 Well, rather than being victims of an unfair process, low 410 00:25:17,400 --> 00:25:20,400 income, people simply do not have the skills to produce and 411 00:25:20,400 --> 00:25:23,000 do things their fellow, man. Leave values. 412 00:25:23,200 --> 00:25:26,600 Seldom do we find poor highly productive, individuals or 413 00:25:26,600 --> 00:25:29,400 nations? Those who have low incomes tend 414 00:25:29,400 --> 00:25:33,300 to have low skills and education and hence low productive 415 00:25:33,300 --> 00:25:36,000 capacity. Our challenge is to make those 416 00:25:36,000 --> 00:25:43,000 people Nations more productive. One last side note money is not 417 00:25:43,000 --> 00:25:46,900 the only way to measure the value of a person. 418 00:25:48,200 --> 00:25:50,900 Another explanation of low income is that the rules of the 419 00:25:50,900 --> 00:25:54,500 game have been rigged. That is people do have an 420 00:25:54,500 --> 00:25:58,100 ability to provide goods and services valued by their fellow, 421 00:25:58,100 --> 00:26:02,000 man, but are restricted from doing so, among those rules are 422 00:26:02,000 --> 00:26:06,000 minimum wage laws occupational and business, licensure laws and 423 00:26:06,000 --> 00:26:08,200 regulations and government-sponsored, 424 00:26:08,200 --> 00:26:11,600 monopolies, henceforth. And Argument for free market 425 00:26:11,600 --> 00:26:16,100 capitalism, is that it is good for low-income low-skilled 426 00:26:16,100 --> 00:26:20,600 people. Yeah, I believe he is wrong in 427 00:26:20,600 --> 00:26:22,700 that. It's the only way I guess he 428 00:26:22,700 --> 00:26:26,700 didn't say it's the only way to measure value you could look at, 429 00:26:26,700 --> 00:26:29,700 you know, say someone makes a bunch of videos and they have 10 430 00:26:29,700 --> 00:26:33,100 million hours of watch time. But no one's necessarily gone 431 00:26:33,100 --> 00:26:34,500 out of their way to make donations. 432 00:26:34,700 --> 00:26:37,800 That doesn't mean well, number of dollars is the only way to 433 00:26:37,800 --> 00:26:42,000 value that person. So I would disagree with Walter 434 00:26:42,000 --> 00:26:44,800 Williams there, the vision of black markets. 435 00:26:45,000 --> 00:26:48,900 We should always keep in mind the resiliency of Gets despite 436 00:26:48,900 --> 00:26:52,800 the efforts of socialist regimes markets tend to survive to one 437 00:26:52,800 --> 00:26:56,600 degree or another. They are an irrepressible part 438 00:26:56,600 --> 00:27:00,900 of human nature. As Adam Smith in 1776 wrote. 439 00:27:01,000 --> 00:27:05,300 It is the necessary. Certain propensity and human 440 00:27:05,300 --> 00:27:08,600 nature, to truck barter and exchange. 441 00:27:08,600 --> 00:27:12,900 One thing for another during the 70 years of the Soviet 442 00:27:12,900 --> 00:27:15,900 experiment, with massive attempts to suppress markets, 443 00:27:16,000 --> 00:27:19,800 including jail banishment. Ant and death markets in one 444 00:27:19,800 --> 00:27:24,200 form or another survived. The conditions, for the 445 00:27:24,200 --> 00:27:28,800 formation of markets are always present and explain their 446 00:27:28,800 --> 00:27:32,700 resiliency. Those conditions are one private 447 00:27:32,700 --> 00:27:37,200 ownership of property to interaction between people who 448 00:27:37,200 --> 00:27:42,200 place different valuations on goods and three individual will 449 00:27:42,200 --> 00:27:46,100 and self-interest. Those conditions give rise to 450 00:27:46,108 --> 00:27:49,400 markets, be they legal or illegal black markets. 451 00:27:49,600 --> 00:27:54,900 According to some estimates up to 84% of Soviet people purchase 452 00:27:54,900 --> 00:27:59,700 goods and services through the black market or fart, Soul 453 00:27:59,700 --> 00:28:04,100 Shiki. The farts of Shiki was also a 454 00:28:04,100 --> 00:28:08,600 source of additional employment and Hanson come for as many as 455 00:28:08,600 --> 00:28:12,800 20 million Soviet citizens. According to Automotive news 456 00:28:12,800 --> 00:28:18,900 1985. 80% of Soviet citizens used black market, mechanisms 457 00:28:18,900 --> 00:28:23,800 for auto repairs and another 30% purchase gasoline and parts from 458 00:28:23,800 --> 00:28:28,600 Black Market Distributors Soviet officials could never eliminate 459 00:28:28,600 --> 00:28:31,500 black markets and one doubts that they want to do. 460 00:28:31,700 --> 00:28:35,000 After all the Soviet system may have survived as long as it did 461 00:28:35,000 --> 00:28:39,100 because some of its more uglier consequences were mitigated by 462 00:28:39,100 --> 00:28:43,500 the presence of black markets. Given the periodic short ages of 463 00:28:43,500 --> 00:28:46,800 the Necessities such as food and clothing. 464 00:28:47,000 --> 00:28:49,800 There may have been uncontrollable social disorder, 465 00:28:50,200 --> 00:28:53,600 if Soviet citizens had to do without rather than have a black 466 00:28:53,600 --> 00:28:57,300 market Outlet to which they could turn to for Relief, the 467 00:28:57,300 --> 00:29:01,300 Soviet experience proves that man is by nature a capitalist, 468 00:29:02,400 --> 00:29:06,200 the transition from socialism to capitalism requires, only that 469 00:29:06,200 --> 00:29:10,800 human nature be permitted to flourish conclusion. 470 00:29:11,800 --> 00:29:15,300 The struggle to extend and preserve free markets must have 471 00:29:15,300 --> 00:29:19,200 its primary focus. The moral argument State, 472 00:29:19,200 --> 00:29:22,900 interventionist stand naked, before, well-thought-out moral 473 00:29:22,900 --> 00:29:27,000 Arguments for private ownership of property, voluntary exchange, 474 00:29:27,100 --> 00:29:32,700 and the parity of markets, people readily understand, moral 475 00:29:32,700 --> 00:29:37,000 arguments on a private basis. For example, one person does not 476 00:29:37,000 --> 00:29:40,200 have the right to use Force against another to serve his own 477 00:29:40,200 --> 00:29:42,700 purposes. However, However, people often 478 00:29:42,700 --> 00:29:47,300 see government redistribution as an acceptable, use of force in a 479 00:29:47,308 --> 00:29:53,100 democratic welfare state that coercion is given an aura of 480 00:29:53,100 --> 00:29:56,800 legitimacy. The challenge is to convince 481 00:29:56,800 --> 00:30:02,400 people that a majority vote does not establish morality and that 482 00:30:02,400 --> 00:30:06,100 free markets are morally Superior to other forms.