All right, so here is that chart looking at this chart, the
greatest chart in the world what can we learn from it?
Okay? So, the first thing and at this
is actually, I will start with a shortcoming of the, of the
chart. The, the hourly, the average
hourly wage is that that should be in green or something like
that because that is the relevant that is the relevant
line from the perspective of time prices based.
Basically, whatever you see below the, the hourly, the
average hourly wages is becoming cheaper, that doesn't mean that
it is not increasing in price, but it is becoming cheaper
because it is growing in price at a slower Pace than average
hourly earnings. So you can see that housing food
and beverages cars household Furnishings clothing, cell
phones toys, computer software TVs Are becoming much much less
expensive, relative to wages. In fact, they are, they are
actually becoming cheaper in real terms because the overall
inflation was 56%. I think you are looking now at
the chart between 19 between 1998 and 2018.
Yes, that's what you're looking at.
And basically, what Mark does here, he puts he puts the black
line through it and that's the inflation and what you can see
is, That every hourly earnings have grown at a faster Pace than
inflation. You would expect that because we
are becoming more productive. But when you look at Child Care,
Medical Care, College tuition College, textbook Hospital
Services, what you realize that it become massively more
expensive. What do they have all in common?
What they have in common is that the the government is very
heavily in involved in their production and also in
subsidizing of them. So for example, college
textbooks, Sun College tuition. There is a reason why it's
increasing and it is because the government is pumping ever more
money into the tertiary education system through
subsidies. So, if a kid doesn't have enough
money, he can also borrow from he can always borrow from the
government to pay back later and he's suddenly sitting quarter of
a million dollars and the university knows it.
So, they can jack up the prices because they know, they are
going to get it Hospital Services.
Once again. This is something that the
government has declared is basically Universal human
rights. So a lot of money is being being
pushed into the healthcare sector in government subsidies
and government regulations. Currently roughly nine, out of
every ten dollars. That, that is being spent.
In, in, in the healthcare sector is being paid by the government
or by by private providers. But not by by the people
themselves. Selves.
So obviously when there's a lot of money sloshing around in a
variety of subsidies and loans and, and so forth, the prices
are going to go up childcare very similar to that that is
partly driven by regulation, for example, in Washington, d.c.
just last week. It was decided that anybody
taking care of children, has to have a college degree.
Now, obviously, that's completely idiotic.
There is no reason for that at all, plenty of Americans have
survived with Latin. Nannies for decades, maybe even
centuries but today in Washington d.c. you need a
college degree. What does that mean?
That means that the your child care is going to cost much more
because you are getting a person who is going to be able to
command more money and and and to a party to pay off their
their debt. Whereas with the market is
permitted to function more or less perfectly cars household
Furnishings clothing tea, Edie's is a perfect example because we
also import a lot of electronics from abroad.
Those have fallen by something like 90%.
So this is a very important indicator of the heavier the, in
the, the the government involvement in Industry, the,
the faster, the prices rise, and the less they are involved.
The the cheaper things get, I don't know if you have this
expression in the Czech Republic but are you familiar with
hee-hoo? Pays the piper calls the tune.
Yes, yes. So another words when producers
have a customer basis, then the customer sort of get to call the
tune, because they're the ones, paying them if they're not
accountable to the customers. Well, then the customers can go
somewhere else. So the producers act to try and
please the consumer. But when there's government
subsidies, well, then they try to please the politicians.
And now it's almost like the consumers are completely
irrelevant. You get treated like total trash
by these producers at that point because all of their focus is
how do we get our funds again next year?
So we have the case against subsidies and then the case you
mentioned that case pisses me off so much about needing a
college degree to babysit kids or watch them in exchange for
money. A belated violation of I mean,
just the self-ownership principle, but look at that.
They're explicitly, lowering the supply of childcare.
Providers. Literally, making it illegal,
unless you have some degree from some Marxist University.
And then they tell you that, oh well, we have no clue, why the
price is so high out of nowhere. They literally limit the supply,
increase the price and say, gosh, I guess the people just
have too much freedom. I mean, it is unbelievable.
That is a very important graph. Thank you for bringing that up,
completely, unbelievable. And it's it has a lot of
Consequences negative consequences throughout the
economy, part of the reason why people are taking, you know,
people are not having as many babies as they could, is because
they are. They're looking at the price of
raising a child in a typical Advanced economy with
regulations like that and saying, well, you know, we
basically cannot afford this that the child is going to cost
us three hundred thousand dollars before it walks out of
the door at the age of 18 adjusted for you know, childcare
and G college, education and things like that.
Do we really have that kind of money, especially in the
economy, where our real earnings are becoming smaller due to
inflation, but that's not. That's, that's a, that's a,
that's that's, that's an example that could be multiplied
millions of times. So here in Virginia, for
example, let's say that you are a billionaire and your greatest
desire in your life is to build a hospital that you are going to
provide. And people with health care, I
realized that not very many people think that billionaires
have a heart but a lot of them do and a lot of them want to do
a lot of good. Look at the charity of Bill
Gates and Warren Buffett, and things like that.
So let's say that. You've got a billionaire, who
wants to only want to do is to build a hospital.
Can he do it in a state of Virginia?
The answer is, yes, he can provided that this billionaire
can prove to the government of Virginia that The need for this
hospital and who decides whether there is a need for additional
Hospital? Well it's all the other
hospitals in Virginia. so, It's called certificate of need laws
for people that aren't, it's called certificate of need
because I did not believe that this was a real thing.
But it actually is and Most states have them.
So, in America, this country, I believe in the Paragon of
capitalism. Your competitors have to
essentially sign off. On the old on you having the
privilege of taking the risk in the marketplace, whether your
hospital is going to increase the make profit or not, you
cannot make it up.