Nicholas, it's great to have you on the episode.
Really, really excited about this.
I've been consuming your content.
Oh, have you ever since ever since Rory, I was raving on
about yours. Like whenever Rory gets excited,
I get excited. Whenever I get excited but I get
he gets excited. Rory is a very generous man, so
you have to you have to exercise care.
He's he. I'm late for this interview.
He's been incredibly gentlemanly, making me feel as
if it's entirely normal to turn up half an hour late for things.
And. I'm mortified.
But anyway, well, you've got some creatives on the podcast.
So we tend to be very, very understanding.
That's correct. That's the whole entire process.
But you know what, We'll just get straight into it.
So for our guests that don't know who you are, it'll be great
for you to give a bit of a summary of, like yourself, the
work you've been doing, and we can start to dive into some of
the bottlenecks that you've been experiencing along the way.
OK, good. So I am.
Let me tell a little story is that my father was an economist.
My brother and I tried very hard not to be economists and we both
failed. And But I'm a kind of roving
economist and I've spent 30 odd years thinking about public
policy, economics, the inadequacies of economics.
And I've spent the last five years feeling intensively
looking at the inadequacies of our democracy.
And I've been asking very simple questions and looking at things
in a very simple kind of way. And when you do that, and you do
sometimes it pays some dividends.
And you, you come to think that you understand certain things
that are simple, but that people are missing and you try and
point it out to them and they tell you you're wrong a lot of
the time. Because it takes a while to to
kind of decompress and to see some of the things that some of
the deep structures in, in the systems that we're all part of
and. When you ask these simple
questions, do people give you simple answers?
No, no, no, because what happens is that we are as as is natural
and appropriate. We're acculturated.
You know, we look at that thing over there and we see a chair
and that's what it is. But it's also a bunch of other
things. It's plastic, it's wood, it's,
it's, it's there. And, and so if you look at
something and you start and you start think, you start asking
yourself why isn't this thing working the way everyone says it
should work? Is it?
Is the fact that everyone is preoccupied with how a thing
should be actually part of the reason why it's not that way?
So how you categorise a thing automatically then induces kind
of biases and habits of thoughts exactly simply as a simply as a
product of the categorisation. Exactly.
But if a thing is a planet, you might not have a very strong
idea of what a planet should be. But if a thing is a politician,
you have a strong idea that this politician is a politician, is
in the House of Commons, and they're doing the wrong thing
and they should do the right thing.
And so you can go one of two ways.
You can go the way that most politics goes, which is to wag
the finger and say should, should, should, should, should,
should, should, or well, why isn't he doing the right thing?
Are there things about the way we've set this up that means
that it's not doing the right thing?
And one way to think about our political system, one way to
think about left and right is that is to ask the role of the
ask the question, what is shoulding doing here?
What is the desire to look at something and say you should be
not the way I see you, but some other way?
And so I would say that the left do shooting all the time, yes.
And the right do suck it up. Mm hmm.
That's the way it is. And they just don't understand
each other in that way. But the right, I think the left
have really got themselves rather unmoored through the
woke, the the, the woke adventure and all that sort of
stuff, which was endlessly shooting and shooting and
shooting and shooting. And then we say that trans women
are women. Therefore someone self
identifying as trans, born a man, gone through puberty as a
man, goes to a male prison either sorry, goes to a female
prison and they have been convicted of a of a sex offence.
You know, that's just completely nuts.
And what's happened to society because just like this podcast,
I, I really like the ability for people that even if you don't
have the same views, you can at least have a conversation around
something. What's happened in society where
everybody's kind of like gone to their direction and they've
stuck to their guns and not willing to cooperate and have a
conversation? What's happened there?
What's happened is that for the past 250 years we've set up
everything that matters to us and our society as a competition
between for and against everything.
So the very terms left and right, where do they turn up in
the French Revolution, where where you sat in the assembly
meant whether you were for or against.
So everything we have, even when it's brand new, like where did
COVID come from? A few months people go by and
they're kind of actually curious.
And then somehow it gets assured, it gets an or, it gets
an ideological orientation, which is absurd for the question
of where did a virus come from to acquire an ideological
connotation. We can do it in months, we can
do it in weeks. And that's what we did, and
that's what we do with everything.
And so we can't really. And so everyone participates in
discussions as if they already know the answer.
It's very interesting. I mean, the the distinction I
always make is do you want to win an argument or do you want
to solve a problem? Yeah.
Because if you think about
probably the worst influence on British politics is the PPE
degree at Oxford. In fact, Oxford in general.
I would, I would extend it even more broadly and say that
effectively it's three to four years training in argumentation
and therefore the consistency of your rationale is more important
than the consequences of the implementation of that idea.
OK. And that, I mean, it always
interests me partly because what's quite interesting about
the advertising industry is I always joke about this in most,
in most areas of decision making, rationality is the gold
standard. And I always argue in
advertising, it's the bronze standard.
That makes sense, but it's a bit boring.
Can we do something a bit better?
And it's always been interesting because it's a different way to
think, because most people are thinking in a way which is as
long and as you can create a kind of internal consistency to
your model, therefore the model is valid and you should
therefore apply it very widely regardless of the consequences.
And I I think argumentation and This is why I'm occasionally
seen as kind of anti rationalist, because I think
rationality is often quite a low bar in many.
Ways but you are. But you're associating
rationality with very much with this idea of having it out
between two sides. Yes.
What do you And so if we're trying to work out something
that we don't know much about, well, you might arrange yourself
into two sides, but then you will also be both aware that you
of all the things you don't know.
And so anyway, so, so an argument or discussion is, is an
ecology of shared things and contested things.
And so it isn't the. So I would say that simply
imagining that a discussion which is a debate between two
people who disagree with each other, simply imagining that as
a paradigm of rationality, is irrational in.
Itself in itself, because we. Have to be able to feel towards
the truth together. And, and, and sometimes I'll say
say no, no, that's, I don't think that's right.
You might say no, no, it is right.
And then we might say right, OK, well, we, we've come to an
impasse there. Let's go look somewhere else.
Or is there another way of looking at things?
They're all those, they're all those things.
And in our universities we teach that.
We teach overconfidence in what we know, all this kind of stuff.
Also, there's a weird thing which is the urge to be
singularly right. The byproduct of that is you
automatically reduce the solution set, because if if you
have a large solution set that requires subjective judgement,
intuition, and actually probably debate and discussion, and you
will actually inform your own opinions as a byproduct of that
discussion. If you want to be right.
Right now what you do is you limit the number of variables.
Typically as an economist, you'll create it as a trade off
between two things, with a single optimum somewhere in
between. Or if you're a politician, you
will engage in what I call peremptory framing.
So you will say, as Tucker Carlson said to somebody in the
military. So tell us how tell us how your
policy of, of not discriminating, not
discriminating against gay people will help us in win a
battle in Iran. Well, it won't do that.
It's not that's not it's function.
It's the, the, the, the there are, you know, this is these are
these are human beings. There's a lot of things to think
about, but you can frame it in a particular way that you look
silly defending. What we need is more gay
soldiers, you know that they're just different things and so
huge amount of politics. Think of the 2 terms, pro-life
and pro-choice. Well, those are peremptory
framings. What they're saying is you
couldn't possibly, you know, could you, could you be anything
but pro-choice? Could you be anything but
pro-life? And so the whole point of this
manoeuvre is to foreshadow is, is to forestall the possibility
of debate. So it's it's, it's a crazy, it's
a. Very interesting example of
where debate comes to a better answer.
And I, I, I've, I've funnily enough, this is where marketing
slightly helps because interestingly, in marketing, you
know, every individual is a potential market.
So you have to be interested in everybody to some extent if you
want to actually grow your business.
And this was one I think that happened in the UK, which was a
discussion on the on effectively taxation of taking airline
flights. And it started off framed in,
yes, we should tax every flight people take.
No, we shouldn't. And eventually I think there was
some sort of effectively deliberative democracy took
place. And they took a representative
sample of people and they arrived at what was actually a
very clever reframing of the whole question, which is
basically everybody's got the right to their fortnight in
Tenerife, OK? But if you fly in as an
individual more than a certain number of times a year, then
there should be a kind of sliding scale of how much tax
you pay on your flights, which is completely different, if you
like. It's sort of squaring the circle
between more tax, less tax. It's taxed differently.
Now one of the things I said to Transport for London is the
whole policy of the, what is it? The, the, the effectively
there's this clean area, area where if you've got an old
diesel car, you've got to pay, what is it 1520 lbs or something
every time you drive into more or less into, into even outer
London. And my only argument was, look,
there's a huge difference between 100 people paying 20 lbs
once and one person paying £20 a hundred times.
If you're a nurse, you've got an old diesel, you've got no choice
but to drive into work at 5:00 in the morning, OK, charging
that person 2000 lbs is ridiculous.
And there needs to be some sort of capping system.
You know, Amazon Prime, you, you know, if you pay £150 and then
you're exempt for two years and then you've got two years to
replace your car. And this very, very crude
effectively, I suppose one of the things I think Gary
Stevenson, I don't know if you've come across Gary's
economics, kind of one of the points he makes, which I think
is a totally valid criticism of mainstream economics, is the
single representative agent model, which is you optimise for
a single average person. And it's assumed therefore that
you've optimised for everybody, which becomes, I think, less and
less successful in a world where of its nature, people are just
more different in their circumstances.
And so, you know, I've, I've always thought that optimized
for the average is a fundamental flaw of economics that, you
know, you, you, you know, essentially one of the points
Gary makes is it doesn't really capture inequality, of course,
because you can have six people becoming monumentally wealthy.
And as far as an economist is concerned, the economy is doing
great. Yeah, yeah.
They always say that there's no one more dangerous than an
intelligent person with a fixed mindset, right?
Because they'll stick to their guns and they'll bullshit their
way through and say you have smart things.
This is a. This is a great point that
Alexander Solzhenitsyn makes, which is he says, you know of
all the villains in Shakespeare, about 200 people are killed.
But in the modern world, the villains have got ideology and
10s of millions of people get killed.
Oh, wow. And then going back to the whole
conversation, everybody thinks that it's one or the other, but
really it's not an all conversation.
It's an and conversation and no one ever considers the and
because people are not looking to actually solve the problem.
It seems like it's more linked to people's identity now.
Yeah, yeah. So it's like.
Like I remember when I was at I was at sixth form and I think it
was the time when Nick Clegg that that that almost like
political run was happening. And I was, I was Labour, right?
And I said, OK, But then if I actually just like made my
answers based on the policies that I believed in, what would I
actually end up being right. But then because I put it into
my identity that I'm part of a party, it's almost like blindly
you have to choose one side or the other, right?
That's. Right.
And then what you do is you surely your opponents and you
make excuses for your own side and you go, yeah, yeah.
Well, he he, you know, didn't answer the question in in, in
Prime Minister's Questions, but that was because, you know, if
he'd done that, then they would have done this really unfair
thing to him or whatever. And yeah, so.
So this is the same ability to get away from the facts with
with spin effectively sort of self spin saying they should
have done this, they should have done that and.
It seems like why? Why is the world's 'cause it was
already a little bit like that ten years ago, tennis or so
years ago, It's become even more polarizing now, right?
It's almost like, and I think Rory talked about this in the
last episode, that if you're moderately left or moderately
right, it's almost like no one listens to you.
That's right if you're far one end or far the other side.
You're much more. I'll tell you the brute.
I'll give you the answer to your question in one answer, in one
word. Entertainment much more
entertaining to run a story about some extreme view, some
extreme event. So that's that's the bias and it
then becomes a tool of political combat.
So you'll pick some completely crazy, some some crazy
proposition from among your opponents that's that's
political. Combat.
There's another thing too, which I don't think anybody's remarked
on, which is when you introduce prohibition, OK, in, in, in the
United States, no one bothers with beer anymore, OK?
Because what the Hell's the point of smuggling beer?
It's massively high in volume, OK?
Similarly, if you watch Narcos, they were basically cannabis
smugglers, OK? And they suddenly go, look, if
we're going to take all this risk of getting something
through the American border, we might as well pack the truck
with cocaine rather than cannabis because it's a high
intensity product, OK? Similarly, not many bootleggers
bothered opening a brewery. It was all high, high strength
spirits. Yeah.
And similarly, if you're in a world where you're not allowed
to make a mildly politically incorrect joke.
Yeah, you might. As you said, you end up with
Andrew Tate. Yeah.
OK. Andrew Tate is the cocaine or
the bootleg gin. Yeah.
Of. Yeah.
Incorrect opinion, you see. Exactly.
Because it's. I suppose.
You know Nick Quinta is the. Current, it's kind of might as
well be hanging for a sheep as a lamb.
So if you, you know, if you're, if you're actually going to
transgress and there's no distinction made between mild
transgressional and extreme transgress.
Yeah. Well, yeah.
Well, the color rage baiting now, right, yes, and and and
there's somebody that obviously like specialized in in digital
marketing, et cetera, et cetera. You recognize that you need to
do a lot to almost like set yourself apart in the doom
scrolling era, right? So you have to do something that
jumps out at people. And then people feel something.
And I feel like we're so hung up or we're so drained in dopamine
excess that it seems like we will not only want.
To experience a dopamine and adrenaline.
So it seems like we don't only want that in our digital lives,
but also in our physical lives as well.
And unless something hits a particular note, it almost like
doesn't register in people's minds.
And is that one of the things that you think are?
Yeah, sorry. Yeah, 1.
Of you that you think are influencing that.
Yeah, I think our our see sometimes people, someone like
Ian Mcgilchrist will say this is Western and it is Western, but
it's now a Western institutionalised in this, in
these adversarial structures. And it's so it makes it harder
to represent the centre. The centre is boring.
The centre is not. The centre is not as immediately
you. You can't cut through quite as
easily. You can't be completely right as
a centrist, can you? It's all a kind of bargaining
thing. Yes, and I'm intrigued by this
as an enthusiastic Georgeist because of course one of the
reasons Georgeism never takes any root is that it's inherently
contradictory in that it's incredibly free market in terms
of the fruits of people's labour's effort.
Or indeed, imagine. And it's socialistic with
relation to what you might call, well, typically land,
historically land, you could extend it actually to scarce
resources like fossil. Fueling.
Yes, indeed. OK, things with rent.
So. So it was almost a religious
distinction which I think people understood in the 19th century,
which is that land and oil are actually the creation of God.
And therefore the proceeds from those things should be
reapportioned fairly because the value of your land is as much to
do with the that's of your neighbors as it is of your own.
But I think in the 19th century they probably had a kind of
religious way of understanding this, which is why Georgism went
very big. I mean, you could extend it also
to, I mean, Facebook or something if you wanted to.
You could just say, okay, there's a kind of gorgeous
approach to the web and that certain behaviours become
essentially so habitual that the ownership of that behaviour
becomes a kind of extractive rent seeking activity.
And it, it's stop, it's shit of occasion.
It stops being value creation. You, you go from being a
property developer to being a slum landlord effectively.
But the gorgeous thing is interesting because it's always
difficult for it to take seed because it requires people to be
both at the same time. Left wing in, in relation to
certain forms of economic activity and right wing in
relation to others. But it's, I mean, I think it's
actually inherently beautiful for that reason, because it
takes what is what appears to be a contradiction and says, well,
it you know, the extent to which you deserve to keep the fruits
of your fruits of your labour entirely depend on the social
contribution that your labour makes.
Yeah. So, yeah, it reminds me of a of
of a philosopher. He was a scientist, then an
economist, then a philosopher guy called Michael Polani.
Who, Yes, of course. Who?
Genius man? Well, he was very so he was a
liberal, he was a friend of Friedrich Hayek's and a strong
free market guy. But he also thought that Keynes
was right and which he was in my opinion.
And what he then did was he designed a system that would be
Keynesian at the same time as leaving, as focusing the
interventions of government as tightly around what Keynes had
identified as the problem, which is the flow of money around the
economy. Got it.
And what had happened with Keynesianism is that it had
picked up a lot of left wing baggage, a lot of the idea that
these that, that for more state investment, more state
supervision of investment and stuff like this, more labour
market regulation. And, and so Palani designed this
system, which would be very, very free market, but would toss
money into the economy when it needed to be tossed in and suck
it back out when it, when it, when it was time to suck it out.
So, so that's that's another exact that number took off
either because you sort of have to.
You have you have to ride two horses.
Well, well, that's well, well, that's right.
And so the right was successful at pedal their their wares by so
someone like Friedrich Hayek raised his money from the owners
of capital and labour was much keener on Keynesian policies,
which came with a bunch of other which came with a bunch of other
accoutrements of the left. So there's a.
That's a. That's a.
That's an analogy in macro. He was also interesting wasn't
he? Because he was an early AI pet
pioneer if I'm right. Irani.
Because he invented this whole concept of tacit.
Well, that's that's exactly exactly.
But but yeah, he, he was, he came up with a, a much more
general way to show, to show this, yeah, that the the way in
which once you get a degree of complexity, you cannot govern
from the centre. And he in fact designed this
model. It was a, a plywood model.
And he showed that if you connect up all these all these
planks to calculate and then you stretch this thing that you've
bolted together, if you had to to calculate all the changes in
angles at the centre, you'd be calculating forever.
Whereas you just pull it. And The thing is a big analogue
computer and works it all works it all out.
Anyway, that's AI don't know whether I've explained that.
Oh, so the the literally the. Interconnectedness is
incalculable effectively, but that if you do the the the
reality will calculate. Itself.
It will calculate itself obviously.
That's about, it's a bit like the three body problem or
something like that. Yeah, yeah, yeah, yeah.
But it's easier to do it than it is to try and predict it.
And it's a much. Better, I think it's a much more
general illustration of this point that you can't govern
complex systems from the centre, than Hayek's argument, which was
much more tied with the price economics.
And prices. And then business people ended
up being the heroes and, and I don't know how that's going
right now, but talking about heroes.
We're talking about superheroes before the the podcast started
and there's a famous quote from while he was from 2 face in
Batman that said you either die hero, you live long enough to
become the villain. Right?
I see which. Is which is why.
Right, which is why I've always said that sometimes the the, the
value of being central, but a little bit to one side is that
you also think about what does the world need right now?
Because sometimes the world needs optimism or like like free
thinking on the other side. And sometimes you need to almost
like go back to your conservative views, right?
So I think that, but then people don't think about it that way,
don't take, they go, go outside themselves to think what does
the world need right now? What kind of leadership do we
need right now? And let's pivot to that for this
season, because everybody always thinks that something is like a
forever decision. It's not a seasonal decision.
And do you why do you think that people don't consider it that
way? All I can say is what we've
already said, which is that memes travel in extremes.
There you are. That's a nice rhyme for you if
you want to. Yeah.
If you want to get velocity on these things, you make them
simple and forever and tribal and left and right whoever.
What are the memes trying to? Remember what?
Scales, OK, pointing scale. And by the way, there there was
a healthy number of Brexiteers who were whose motivation was
essentially localist. In other words, they believe
that decisions should be taken by people who actually get to
experience the consequences of those decisions close to the
point where the decision was made.
And I've got friends who are in local politics, OK, and they say
it's not actually very partisan, most of the discussions in local
politics and nothing to do with left and right.
It's they're practical. Where do we put this incinerate?
That's right, OK. And very occasionally there may
be a political angle to it, which is obviously the left wing
people want in the pot area. But broadly speaking, they solve
problems through intelligent debate.
And actually, I would also argue that if you look at polarisation
and the kind of weird woke thing, it doesn't.
Really. Exist in provincial or remote
areas. So this is the strangest thing.
Is a New York friend during COVID.
It's very interesting. So, so universities.
Can maintain it, the level of weird intensity that makes it
possible. Yeah.
And very large cities like New York or London will maintain it.
Yeah. Yeah.
When I move. When I move to Kent, you know,
blessed decision in my opinion. Charlotte to Kent, one of the
first. Things I do is I go to.
One of these county fairs, OK, yeah.
And there. Are three.
Stalls at the County Fair and there is literally, I'm not
making this up, the RSPB bird charity, right?
A stall selling Jost sticks run by hippies and a stall selling
shotgun cartridges and hunting equipment.
And having moved from London, who the hell was the idiot who
put these three people together, these three standards together?
Because it was just comical, right?
And they went closer. They were making each other cups
of tea. And a friend of mine left New
York. I'm I'm actually basically a
provincial advocate. I think that urbanization and
gains to agglomeration. The idea that economists have
forced us all to believe that the future of humanity is living
in ever greater population densities.
They only that that was something.
They came up with about 30 or 40 years ago and they were telling
they were saying the opposite before that.
Yeah, I'm. I'm basically.
You know, I I want to leave this urban movement, you know, mock
Tudor homes. Everybody's gonna Norma.
Yeah, actually, Australia, basically.
You like a bit of space, don't you?
Yeah, well, no, because we're the.
Most urbanised country, but on the other hand, your.
Cities are in North, not those sucker cities.
Yeah, yeah. But absolutely.
Huge. But.
The funny thing was this friend of mine left New York and he
moved somewhere in Montana and the local Co-op which is
slightly more upmarket than I think that it is new.
I like the Co-op. In the UK.
The local cop was entirely run by transgender hippies.
The clientele of the local Co-op was people who turned up in
pickup trucks with gun racks. There was, and he.
Comes from New York and he just cannot understand what's
happening. But these people Co exist
completely. A Texan friend who just goes
basically, you don't get riots or anything of the kind.
And because he said very simple, we're all Texan.
Yeah, OK. So the Texan.
Less basically effectively overrides any other differences
you may generally experience because you've got your own
identity. And I wonder about this because
the media are we effectively allowing our debate to be
dominated by something. And this is my big question,
which is why I won't get into very woke debates about trans
issues on either side. Yep Yep Yep is simply the
opportunity cost. Well, you would.
You basically will be misunderstood.
I mean the the people will wilfully.
Misunderstand what I built on wilful.
Misunderstanding in both directions or confected outrage?
And it's it's no. Fun.
It's absolutely no fun. It's If you are hated for what
you believe and people understand what you believe,
that's one thing. Being hated because people don't
understand what you believe? Wilfully misunderstanding.
You know, really, really. Really.
Yeah. What's the point?
Of that, everyone's wasting their time and everyone's upset
and. Actually, my, my contention
would be that in provincial settings, OK, generally when you
have lower population density and the same people encounter
the, you know, the same people, one thing is you can't become an
absolute bore, OK? You can't on social media, you
can be a single issue fanatic where you talk about nothing but
Brexit. Who's that philosopher guy?
AC Grayling? OK, you go to his Twitter feed
and there hasn't been anything other than an anti Brexit tweet.
And I'm kind of going, look, mate, can we just have a kitten
falling off a skateboard, please?
You know, crying out loud, you couldn't do that in a pub
setting because you'd basically be known as Boring Dave and no
one would talk to you. So let me.
Let me I had this thought about. I think we should just re
provincialize. I think you just don't move,
move back to the country. We'll rewild it.
Everybody has a bit of space, you know, We'd all be happy, you
know? So E Kent, nationalism, That's
me. That's very grand.
And I'm not. I don't.
None of my thoughts are grand in the sense that I'm not.
I'm not recommending any large scale social engineering, Rory,
but just a few weeks ago I was thinking, but do you remember,
Rory? You may well do.
Do you know the So the Royal Society founded in this town,
London in 1660, and it had a motto in Latin.
You remember what it is? Oh, crikey, yeah.
It's nullius. Yeah, nullius in verba.
Except nothing. By word.
And the idea was that all there were all these people around who
thought that angels dragged the planets around the sky.
Why? Well, because Aristotle said so.
Now, I don't know whether Aristotle said that, I think he
didn't, but he said that they had, that planets have AT loss
and they're following their T loss or their purpose or their
end in life and so on. And there was this incredible
idea that we've got that we've actually got to actively get
that out of our system and we've got to try to accept only what
our experience tells us works. And I'm thinking Nulis and
Verba. Well, I think the, I think the
motto of our systems of politics and governance in the cities,
not in the country is omnia in verba.
And I don't know whether that Latin is correct.
It is, yeah. But everything's in words.
Yeah. And, and and there is one
institution in our governance structure which isn't like that.
And it actually brings up this question that we've talked about
before, which is tacit knowledge, knowledge that is not
articulated, and possibly because it cannot be articulated
how to ride a bicycle. How to ride a bicycle?
How to come up with the next word I am assembling in this
sentence that is done with tacit knowledge?
I have no fucking idea how I do it, but there it is.
And that is, according to some people, including me, the most
important thing, the foundation of our knowledge.
Not explicit knowledge, but how do we learn to walk?
How do we learn to talk? How do we learn to ride a
bicycle? How do we learn to interact?
All these things are flush with tacit knowledge, but our
political system is a meme driven political system.
But in the counties, yeah, that's not how people think.
And in a jury, that's not how people think They think.
You know, I like that, that person.
I trust them. I trust them.
They're they're they're not playing to the gallery.
They're not giving me a hard time.
They, they heard what I said and they, they, you know, the last
time they heard what I said and they agreed with me.
This time they're disagreeing with me.
I think I'll try and figure out why.
And that's not there in our political system.
It's not there in our our media system.
You can't, you've got to be extremely articulate, very
quick, very succinct and determinative.
If you're asked a question, if you so imagine saying as a
politician, and this is an actual quote, imagine you're the
treasurer of a country and a journalist says, when will this
recession end? And you say your guess is as
good as mine. Well, you've lost a job.
You, you within a week, you will be out of your job for telling
the truth. And that's, that's, that's the
world of Omnia in verbs. That's really interesting.
Because I saw a quote online that basically talked about the
fact that whoever it was convinced us to leave the
village and then to buy it back at a premium, right?
So that's effectively how society worked.
You had people around you, your family support, and then you
have to go to a completely different location, be by
yourself and go into this rat race so that you can just buy
the village back of a higher premium, which is effectively
what happens, right? And and.
Not only. Are you on your own?
Not only you have to buy it for a premium, you also are a sheep
towards the mentality and the attitudes of what happens within
that location. Yeah, which is super, super
interesting. But I I just feel beautiful
phrase. I've never occurred to him.
That is exactly what's happened. That's exactly what happens.
Yeah, right. You're just by leave when you.
Leave. You're forced to leave the
village and then go and buy it back in a premium is an
extraordinary way of looking at this.
That's how society. Is right.
So they make They convince us that we need these things.
They convince us that we need to embody this identity.
They convince us that we need to that the films like there's so
many films like Wolf of Wall Street and Sex in the City and
all these things that glamorize just like city business person.
Like even I would say people like Gary Vaynerchuk, who I love
so much from what he's done for my career.
He got me on this hustle train to want to be super productive
and on everything and consume everything.
But, but I think that as people now start to almost like unwire
and unplug from the Matrix, like I like to say, and are starting
to spend more time on God's green earth, we're now starting
to think for ourselves a little bit more.
I think that the sensationalism that's happening on social
platforms, a lot of people are talking about the great like
unplug. That's already starting to
happen. It's starting to happen amongst
the younger audience already. They're starting to realize that
this is not where the vibe is. Very interesting thing.
When you work in advertising, one of the things you start to
notice is the things that are advertised unconsciously without
anybody needing to pay any money to do so.
And one of them is that, you know, urban urbanism is
wonderful. Suburbia is dreadful and small
minded and provincial and the countryside is full of Hicks.
You know, that's an absolutely common media narrative.
Of course, the other narrative, which is extraordinary when you
look at it, I'm not joke about things like the worst treated
thing in the world by the media is undoubtedly the underground
car park. I, I, I, I was giving a talk
last week in a Norwegian underground car park.
They've obviously dressed it up a bit.
And I joke that, of course, this is to me, the most dangerous
place in the world. Because if you watched a lot of
Scandi noir, yes, there is never a film scene set with an
underground car park without someone being killed.
OK. So underground car park, the
actual data on, you know, crimes committed to underground car
parks is probably quite forgiving.
Yeah. But the other one, which
astounds me because it went on for 50 years, was that rising
property prices are a good news story.
And that was sold to everybody, you know, so that literally now
people have a mentality which is if I spend money on rent, it is
completely wasted. If I spend money on property, it
is an investment, a completely bifurcated idea.
Now, never mind the fact that if you just invested some of the
money you weren't spending on a mortgage, you know, you might
get a better return, or the fact that most of your mortgage is
actually going to the bank in the shape of interest payments
over 20 years. But that has created this
literal framing where, Oh no, no, if you're renting, you're
just pissing money out the wall, for example.
But then also there's a whole. Conversation around opportunity
cost, right? Because because you're now have
a mortgage and you're planted in one place, what can't you do?
What can't? You do.
Right. I think people don't talk about
and if you live in the house, it's not really an investment
because you're spending a lot of money to uptake the house.
It's only if somebody else is paying for it, that's an
investment. I think there's a lot of
narratives that's just been put out there.
Absolutely right. Yeah.
Yeah, that, that, that everybody.
Has just assumed to be like factual and the way that it is
right that the whole you see that with now with the crypto
kind of like space. So the buyer, the dip buy high
sell low, all this kind of stuff that's happening, but a lot of
it is just about adrenaline. Even though they say this in
theory, as soon as they see something going to the moon,
everyone buys it anyway. It's really interesting we're
talking about. The meme error right now and
Trump has his own coin when he started intervening in the
middle. East in a deeply, you know,
irrational and random way. OK, it was primatology.
It wasn't rationality. The only thing I said to my
wife, I said it's not like all the rational people have solved
this problem and. That was my only.
Defence, which is occasionally if something, if a problem,
proves itself. Ideology proof, Rationality
proof. Actually going in and doing
something completely random is probably not all that crazy.
Yeah, no, no, I'm. I'm.
Not that critical of Trump's, of what Trump's done externally
anyway. That could be read in lots of
different ways. You'll get.
Misrepresented here. Oh, yeah, exactly.
Massive megaphat. Nicholas Grudd?
Yeah, that's exactly. Don't worry.
Yeah, dear idea. Oh man.
But. Talk about countries and running
countries. Yeah, you obviously talked about
the fact that GDP is not the only way to measure the the
quality of how a country is doing at that given moment in
time. What are some of the other ways
or whether some of the other symptoms that people should be
looking at to be able to measure the current state of a country?
Because right now in the UK, as soon as you talk about what's
happening, I was like, it's a bad times, isn't it?
That's the narrative that's going on around.
But is it really bad times? What's happening?
It'll be great to get you up well.
Yes, I've spent a fair bit of time on the question of GDP.
It's a very Bobby Kennedy in 1968 said this famous thing,
which is the GDGDP, measures how many guns we make, landlines
contribute. To GDP weapons all the thing.
Anything that is run through the economy contributes to GDP.
How much we love our children, the the quality of our
relationships, none of that in GDP.
And so he summarizes this by saying, in other words, GDP
measures everything in life except what's most important.
Now that's a good meme. And I'm, you know, good luck to
him because I think it was a very important thing to say.
And we are a civilization that's been overrun by a material, a
craze for material things. However, then there are people
who point out that GD, if you go on a holiday or spend it on your
education, GDP tells you that you're equally rich after you've
spent that money, which is not true because if you build it
into your education, then you have more, you have more assets
to work with when, when you've, when you've done that.
That's one example, although not if everybody else does the.
Same thing. Well, so we've created a
bottleneck here in education, which is we told everybody that
the roots to success. Well, yeah, yeah, but you're
framing. Education as a positional good,
which it is, Yeah, which it is, but it's.
Also, it's also an absolute good.
I completely, exactly exactly. And then there are things like,
I think the university of. Cambridge is a positional good,
and I think that YouTube Premium is an absolute good, actually.
OK, right, Nicely put. Yeah, yeah.
And, and one way to think about this, and it's a very important
thing which economists haven't got anywhere near really, is
that I actually haven't. There must be some studies of
this, but I think our world is becoming more and more and more
saturated with positional goods. And positional goods are this
madding thing that have an infinite capacity to spend
money. And, and as you race up the
chain, you get no more welfare. So as you spend more and more
money on more and more exclusive brands, you don't you don't get
complicated. I would argue, OK, that there
are two kinds of positional goods.
No. OK.
So no, no, no, no. There are positional goods which
ultimately end up as absolute goods.
So my, my yeah, yeah, yeah. So my grandparents were the 4th.
Family in Wales to own a dishwasher.
It cost, that's right. It cost an insane amount of
money, that's right. But they were providing early
stage funding for the dishwasher breaks, anti skid breaks.
Yeah, you've got exactly in. Luxury cars and then.
They, they, you know they, they. They then become available to
everyone. And it's not true of handbags.
Is it? It's emphatically not true, and
it's. Not true of real estate.
Which is more and more important than that.
You're right. Increasingly less true of
education, which is your point. So the computer was a position.
I mean, you know, that's, yeah, the most thing staff education
wasn't. Nearly as much of A positional
good 100 years ago as it is now, so particularly in the United
States. Well, this is, I think, Scott.
Galloway's point, which is the ultimate luxury goods brands
Aunt Louis Vuitton, it's actually Ivy League university,
which are creating art of now the other the the condition.
I think that makes it clear which is, which is artificial
scarcity. So if you're artificially
limiting the quantity of something, you've got a
positional well. No, but there's a real estate is
not artificial scarcity, but it's natural scarcity.
And so so. Scarcity with status driven
competition, that's a positional good and that's making us less
well off there is there are some.
Good things to consumerism as a positional good, which is in a
consumerist society, a good plumber has a better car than a
bad doctor. If you have a status system
which doesn't have the consumerist element, OK,
Arguably your status is kind of fixed by your level of
educational attainment age 23, a bit like it is in it always has
been in France. OK, the first question,
literally someone could be 50 in a French business and they're
appointed CEO and the first question everyone asks is where
do they go to university like? That's relevant.
You know, 30 years later, OK, they're, oh, they're going to
the Achilles administration. Fantastic, right?
They must be absolutely brilliant.
And so there's an element to me which actually supports a level
of consumerism in the sense that it is at least attainable by
everybody, OK. Whereas other forms of status,
particularly if they're conferred by credentialism early
in life, strike me as a bit dodgy.
Totally. Yeah.
So. Nicholas, we've come to the
time. I wish this was longer.
I know I loved listening to We will have to.
Continue and I'll just we can continue it online.
I'll just. Here from the other side of the
world, like Zordan and. Here's my point now.
Martin Wolf in. The FT describes Nick as the
best economist you've never heard of.
Yeah, I also explain why he's the best economist, which is
that Australian economists are a bit like Australian fauna that
you've evolved in isolation, Right.
So, you know, if you see what I mean.
If you'd if you'd grown up in the United States, you would
have ended up as a Chicago School economist or a Harvard
economist. But being in Australia or New
Zealand, you're sufficiently remote for evolution to take
really interesting and new forms.
You see, I genuinely believe that about a lot of Australian
intellectual life. It's really, really interesting
because actually precisely for the same reasons that, you know,
Australian wildlife is really interesting.
I hear we had a. Technical malfunction here.
We've missed something actually, and we got over there.
Happy birthday to you. Happy birthday to you.
Happy birthday, dear Rory. Happy birthday to you.
I will pretend to blow the candle gun.
The cameras are still. Rolling terrific cake I've ever.
Seen in my life. I mean, you're trying to kill
me. Feeder, basically a feeder.
That is fantastic. Thank you very much indeed.