April 27th 2022.
Without government who would build the roads? Should prostitution, speculating and price gouging be outlawed? In this episode Saifedean discusses these questions with eminent Austrian School economist Dr Walter Block. They cover fundamental issues in economics such as whether there is such a thing as a “public good”, whether economics is an empirical science, and whether it is ethical to outlaw “victimless crimes”. Dr Block also shares the story of he became a libertarian and Austrian economist, including the roles played by Ayn Rand and Murray Rothbard in his intellectual journey.
- Atlas Shrugged by Ayn Rand
- Economics in One Lesson by Henry Hazlitt
- Dr Block’s paper “The Minimum Wage Once Again” debunking a well-known 1994 study by Card and Krueger.
- Mises Institute article “The Phillips Curve Myth” on the relationship between inflation and unemployment
- Dr Block’s book The Privatization of Roads and Highways
- Dr Block’s book Defending the Undefendable
- Principle of non-aggression explained on Mises Wiki
- List of Walter Block’s publications online
- Dr Block’s book Water Capitalism (2015)
- Saifedean’s first book, The Bitcoin Standard
- Saifedean’s second book, The Fiat Standard
Saifedean Ammous: [00:03:02] Hello and welcome to another episode of The Bitcoin Standard Podcast! Today’s seminar hosts economist and professor Walter Block, who is the Harold Wirth Endowed Scholar Chair in Economics at Loyola University, and a senior fellow of the Mises Institute. Professor Block is one of the most eminent thought leaders in Austrian economics today.
He has published prolifically on countless questions in Austrian economics. He’s an old friend, colleague and coauthor with Murray Rothbard, so he knows him very well. He’s also known Friedrich Hayek very well, there’s a photo of him playing chess with Friedrich Hayek on the internet.
We’re going to be asking him on top of Austrian economics as well, we’re going to be asking him about those [00:04:02] people since he knew them very well. And we’re going to be discussing some of his works including Defending the Undefendable his book from 1976, as well as The Privatization of Roads and Highways to answer the age-old mystery of the question of who will build the roads?
So, Professor Block, thank you very much for joining us today!
Walter Block: My pleasure, happy to be with you guys!
Saifedean Ammous: Thank you. Before we get into the mystery of who will build the roads, let’s begin a little bit by talking about you and your background and what got you into Austrian economics. And let me just first say that there’s something curious about PhDs in economics in Columbia University, because you have one and you ended up being an Austrian and Murray Rothbard has one, Tom Woods has one, and I also have [00:05:02] one, and we’ve all gone down that path. So how did you like me and all of these many other people, end up going down that path of a PhD in economics and then becoming an Austrian economist.
Walter Block: In order to explain that, I have to explain how I first became a libertarian because I became an Austrian because of my Roth Bart and I’m wouldn’t have met Murray had I not been a libertarian.
So let me start just a little bit back, I went to high school with Bernie Sanders. We overlap for four years. We were buddies, we were on the track team together, and one year at Brooklyn college. And my views were similar to his, I wasn’t as into it as him but I agreed with all of his views.
And then Ayn Rand came to Brooklyn College to speak, and I came to boo and hiss her, because she favored free enterprise, and everyone knows that free enterprise is an abomination that leads to [00:06:02] poverty and misery, and it’s fascism and all that. After the lecture that she gave, I still wasn’t convinced.
And they had a lunch in her honor, and anyone could come, even if you disagreed. And I was going to try to convert her to socialism, so I went to the lunch and Ayn Rand was sitting at the head of the table, a long table, 50 people on each side, and next to I was Nathaniel Branden and Leonard Peikoff and Alan Greenspan and her Lieutenant.
And I was relegated to the other end of the table, I turned to my neighbor and I said, hey socialism is the way to go, and he said I don’t really know all that much about it, but the people who do are at the other end of the table. So I went and I stuck my head in between Ayn’s and Nathan’s and I said there’s a socialist here who wants to bait somebody on socialism and capitalism.
They said, who is it? I said, me. I was maybe, I don’t know, 20 years old, maybe a [00:07:02] sophomore in high school and Branden maybe 35, and Rand 50 years old. Branden was very nice. He said, there’s no room at this end of the table, but I’ll come to the other end of the table, I’ll talk to you under two conditions.
One condition is you have to promise not to let this conversation lapse until we settle it, and secondly, you have to read two books that I’ll recommend. And I promised. The two books where Atlas Shrugged by Ayn Rand and Economics in One Lesson by Henry Hazlitt, which was really Austrian-ish. And I came to his house, Ayn Rand’s house four or five times with my roommate Ben Klein and I was converted, and I became a free-market Randian type.
I didn’t go whole hog for the Rand view, but I was at least as good, not as good as Hazlitt, but I agreed with Hazlitt and I learned a lot from Economics in One Lesson. [00:08:02] Then I decided to go and get a PhD in economics because I thought economics would be a good way to promote liberty, and I was a libertarian. Ayn Rand would not call herself a libertarian.
She considered us hippies of the right. But on economics, there’s no difference between her and libertarians. Then I was in graduate school and there was this guy, Larry Moss, who sensed a kindred spirit, he and I, and he was a friend of Murray Rothbard, and he said, you gotta come meet Murray Rothbard, you’ll love him, he’s great, and he’s an anarchist.
I said, anarchist? I don’t want to meet an anarchist. I was a Randian, and anarchist is evil. We need the government, limited government still, but we need a government. But finally Larry and his roommate, Jerry Wallows has prevailed on me to go and meet Murray. And Murray converted me to anarchism in about 10 minutes.
He was very unfair. He used Henry Hazlitt’s arguments. [00:09:02] He would say you can see clearly why we should privatize the post office, right? I said sure, sure. And you can see clearly why we should privatize, schools or something like that. And the argument was ethics and economics.
He said why can’t we privatize the police? Why can’t we privatize the courts? How about the armies? And that was it. In about 10 minutes, I was converted to anarcho capitalism. Austrianism took a year or two because I was now under the mentorship of Gary Becker, Nobel Prize winner at economics at Columbia.
And I couldn’t get through my thick head praxeology, which I think is the main contribution or the main distinction between Austrians and mainstream economists. Gary Becker was fine on minimum wage and free [00:10:02] trade, and rent control, the topic of my dissertation, and on dozens of other issues, but on one issue I agreed with him, not with Murray. Namely that there are no synthetic a priori statements. That if you want to be a good scientist, a good economist, what you have to do is realize that all we have is hypotheses, say that the minimum wage law creates unemployment for unskilled workers, and we have to go out and test it, and we have to do empirical work.
And that was my thing. The idea that that economics is really not an improval science, but rather just a matter of logic, it’s just logic starting with human action was alien to me. The idea that something could be absolutely true, and not a tautology, [00:11:02] and say something about the real world, just went right over my head. I couldn’t get that. Took maybe a year or two for me to get that, but finally, I got that and I realized that yes, rent control creates miserable housing and a minimum wage law creates unemployment for unskilled workers.
And there’s nothing wrong with empirical work on this, but you’re not testing that, rather what you’re doing is illustrating it. And sometimes they don’t succeed in illustrating, but you’re not really testing it.
To give you an example, I got converted to this and I tried to convert Gary Becker to Austrianism. And what happened was I was doing my PhD dissertation on rent control. And it was an econometric analysis, and my independent variable is number of years that a city had rent control. They all started in [00:12:02] 1942 and they decontrolled some in 45 and some in 50, some in 55 and some like New York city at the time, and now never decontrolled.
So that was my independent variable, and my hypothesis was the more rent control the worse housing, holding everything else constant that I can think of, weather, wealth, who knows what, whatever I could hold constant, and most of the time I got good results. The independent variable had the right sign and it was statistically significant.
However, every once in a while, horrible, I got the wrong sign, namely more rent control meant better housing, holding everything else constant. And sometimes it was statistically significant. So what Gary Becker should’ve said, if he really stuck to his empirical fallacy, would be, oh, I’ve got this wonderful young Block student who’s going to turn over everything we know about rent control. He goes look, my [00:13:02] latest econometric results showed that. Instead what he said was, Block you moron, he didn’t say you moron, he was too nice, he said, Block go out again and keep working until you get it right.
So what was testing what? Was my stupid econometric stuff testing what we know from logic about rent control? No. Rather, what we know about rent control from logic was testing my stupid econometric results. Namely, I had him as an Austrian, but he wouldn’t give in, he wouldn’t change, I tried. We had friendly arguments like that, but to me, my stupid results show that what we know about rent control is wrong, that’s just silly.
So I finally got Austrianism and I see the essence of Austrianism, it’s just this, are there synthetic, a priori statements, is there such a thing as economic law? And the Austrians say yes, there are economic laws, [00:14:02] not everything in economics is an economic law. For example, the elasticity of Lima beans is minus two or minus four, no economic law.
If you want to find out, you have to do econometric studies. Sorry, I gave you a long winded answer.
Saifedean Ammous: No, this is fantastic. So essentially I think the answer to my original question is that it was really the empiricists at Columbia University who made you into an Austrian, right?
Walter Block: Murray did it. He got his PhD at Columbia and he converted me to Austrianism as well as the anarcho capitalism.
Saifedean Ammous: Yeah, it was also my experience. It was really just listening to the statist perspective continuously getting repeated that kept on making me ask questions and figure out what the problems were with it.
I think if I were to say who was [00:15:02] my most influential figure in making me a libertarian, for you Murray and Gary Becker, for me it’s probably Joseph Stiglitz. His continuous illustration of just all of the ways in which you could have bad ideas about economics and justify statist intervention was ultimately what kept me digging in the direction of libertarianism and Austrian economics, it was a wonderful advertisement for Austrian economics.
So you mentioned the example from Gary Becker on what changed your mind about praxeology, but in particular how would you articulate your case for praxeology as opposed to empirical economics?
Walter Block: Just that there are economic laws. [00:16:02] Mises thought of one: human beings act. Well, how are you going to deny that without acting? You can’t. There are economic laws and economic laws means they’re non refutational. Another one would be, I bought this t-shirt for 10 bucks let’s say, I necessarily, apontifically, undeniably gained in the ex-ante sense, because why would I have bought this shirt for $10 if I hadn’t valued it at more than $10? And I made a profit.
The claim that I made a profit by buying this ex-ante, now ex-post is a different issue, but ex-ante is necessarily true, and it tells us something about the world. And Hans Hoppe has got a list of, I don’t know, 15 to 20 of these with money and free trade and all sorts of [00:17:02] things.
So there are economic laws. Economics is more than just hypotheses. Yes, we also have hypotheses which are not economic laws about the elasticity of something or other, or if the money supply increases by 10%, what will be the price rise? Need not be 10%, it will be something, but it need not be 10% due to expectations.
So there are hypotheses also in economics, but there are also laws and people like Gary Becker and Jim Buchanan and Milton Friedman call Austrianism a cult. Why did they call it a cult? Because we believe that there are economic laws, and they think that there’s no such thing as an economic law, and I think that they’re mistaken.
Saifedean Ammous: Yeah, and the incoherence and inconsistency in their [00:18:02] position here is that they’re pretty unequivocal about, for instance, the idea that minimum wage is bad. Somebody like Milton Friedman is entirely convinced about minimum wage, which is a conviction that is not really justified by the data and the literature.
If you wanted to read it look at it, there are all kinds of studies that show ambiguous effects, but yet people are Gary Becker and Milton Friedman always fall back on saying the minimum wage is bad, we should oppose the minimum wage. I agree with them, but their agreement is not predicated on data. It’s predicated on them understanding how this actually works.
Walter Block: Right. What I say, if you scratch a good economist, you’ll find an Austrian.
Saifedean Ammous: Yeah.
Walter Block: Gary Becker and Milton Friedman and Jim Buchanan are all good economists, and the proof of it is that they stick to their guns no matter what Card and Krueger fine or fail to fine.
And that shows they’re a good economist, which means they’re Austrian economists. A good [00:19:02] economist is an Austrian economist and a non Austrian economist is not a good economist. Those guys are really Austrians deep down. It’s just superficially they say that Austrianism is a cult. They just don’t understand what’s going on.
Saifedean Ammous: And also they’d like to pretend, which is essentially the same a fallacy that the Keynesians fall into, they’d like to pretend that their conclusions about economics are arrived at empirically and from a blank slate. They don’t have ideological priors that they’re utilizing, they’re not dogmatic about this, they’re not ideological about it.
They’re just looking at the empirical data and arriving at the conclusion. The empirical data says, this is weird because it’s ridiculous that you want to try and convince me that the empirical data says minimum wage is bad, but having a central planner in charge of the federal reserve is good because there’s data. And [00:20:02] it’s just scientism basically.
Walter Block: One of the best examples to illustrate this is what happened with elevator operators in, this must’ve been around 1937 or so, when the minimum wage law went from 40 cents to 70 cents. Almost a doubling, or 40 to 75. At that time, you’re probably too young to know about this, but at that time you go into an elevator in an office building, there’s a guy standing there.
He’s not a pervert, he’s the elevator operator. And minimum wage went from 40 to 75 cents I think it was, how many manually operated elevators was supplanted by automatic elevators the next day, zero. None. Namely everyone, all those guys, they got a nice wage increase from 40 cents to 75 cents because you can’t fire them immediately because it takes a little time to [00:21:02] replace them with automatic elevators.
The idea was that at that time at 40 cents a manual or person elevator operators were more economical than automatic, but at 75 cents it switched. And now automatic elevators are more economically viable, but it takes time. So if you do an econometric analysis, one day later, or one week later after the minimum wage, you’ll conclude that the minimum wage law is great.
It doubled these semi unskilled workers, wages actually doubled and everything was fine. But then over the next two or three years, after three years, there were no more manually operated elevators, they were all automatic and then people didn’t connect the two. They said it’s the interest rate or technology or something like that.
So the crucial thing is the timing. [00:22:02] If your econometric stuff doesn’t find minimum wage law creates unemployment for unskilled workers, try again until you get it right. And another thing about replicability is Card and Krueger, they try to replicate what they did and they couldn’t replicate it.
And yet somehow pardon Kruger, and a lot of other people have failed to find unemployment effects for unskilled workers, who we know just as a matter of logic, if you have a minimum wage law of a $7 an hour, what about if your productivity is $2 an hour? Who’s going to hire you, you lose $5 an hour.
It’s just a matter of pure logic, elementary logic.
Saifedean Ammous: Yeah, absolutely. I think ultimately what it really comes down to is there is no possibility of interpreting any data without priors. You have to have a prior. And they teach this in statistics. In [00:23:02] actual statistics classes, actual statisticians will tell you, there is no way of establishing causation through data purely.
There is no way that you can get two datasets and establish causation from them in the real world, because the data itself cannot tell you. You can find very strong correlations that have absolutely no imaginable link between the two data sets, and you can find examples where relationships exist but it’s not very easy to find in the data. But you can’t establish any kind of causation unless you understand what you’re looking at.
So data on its own cannot tell you anything. You have to understand what the data is, and you have to have plausible mechanism for interpreting and understanding it, because otherwise numbers themselves, they can’t say anything.
Walter Block: There’s an aphorism on that. If you torture the data enough, they’ll tell you whatever you want to hear.
Saifedean Ammous: Exactly. There’s always tricks to play with [00:24:02] data and the more you study statistics, the more you see this. And then the more you look at modern science, the more you see this. So there’s all kinds of studies that show all kinds of things. medicine is a great example. There are studies and there’s an endless number of studies that show that everything causes and also cures cancer.
Run the numbers and they’ll say something, or they will say it’s opposite, and then you’ve got a paper out of it. So ultimately without without priors, without the ability to logically understand the data, you can’t say anything. And the interesting thing about people who claim to be empiricist economists is that in theory, they’re trying to ape the methods of the sciences.
They’re trying to say economics is going to be like a science, so we need data and we need to have experiments and we need to [00:25:02] falsify results. But in reality, you’d look at what actually goes on in say, for instance, macroeconomics, it’s really just some guy proposes a story which is Keynes in the case of macroeconomics, and then it becomes gospel, and then they’re torturing the data to try and support this theory, and then anything that doesn’t support the theory is considered a paradox, and an outlier and something that’s strange.
It bears no relationship to the actual scientific method. You’re not actually going out there and looking to real-world data to falsify your Keynesian framework.
Because if that was the case, in the 1970s, we did have a very radical real-world refutation of the Keynesian model for how the economy works. So up until the 1970s, wel up untill today, if you look at the [00:26:02] Keynesian textbook, it says you can’t have high unemployment and high inflation, you can’t get a recession and inflation.
You either have a recession if aggregate expenditure is too low, or you have inflation of aggregate expenditure is too high. But aggregate expenditure is the determining factor of the state of the economy, and it’s either too high or too low. Then what happens when you get a recession and inflation? If you’re actually being empirical, if you really trying to pretend like you’re being a scientist here, the least you could do is just kick out the entire Keynesian model of all the textbooks forever.
Never to be mentioned again, this is just as clear and as direct refutation or the central tenant of the theory. And yet it’s still there, 50 years on.
Walter Block: Murray Rothbard tells us a story about Arthur Burns, who was his mentor at Columbia and also the head of the Fed. And this was before the seventies, when we had inflation and unemployment.
And somebody asked [00:27:02] Burns suppose we had that, he said then we have to resign. They should all resign.
Saifedean Ammous: But they didn’t, they don’t. They just keep at it. It’s amazing. They pretend to be empiricist and pretend to be doing scientific theories, but there is no amount of data in the world that will really refute this.
Like we saw the 1970s come and go and we still don’t see this stuff taken out of the textbook. In fact, it’s hilarious if you teach the basic kind of Samuelson textbook that gets taught today. How they teach the 1970s is hilarious. They say so there is a trade-off between unemployment and inflation, but then in the 1970s, we got a rise in unemployment and inflation.
And they argue that essentially there’s this Phillips curve, which shows you the trade [00:28:02] off. The Phillips curve is either, it shows that you either have high unemployment and low inflation or high inflation and low unemployment, and then they just argue that the Phillips curve just shifted.
And so now we can move to a point where you can have high unemployment and the high inflation, because we were playing on the previous Phillips curve, now we’re on a new one. So what use is your data? What use is your theory? You look at the data, you see that just as a scatterplot, there’s no relationship.
There’s high inflation and unemployment, there’s low inflation and low unemployment, and there’s high inflation, low unemployment, high unemployment, low inflation, everything.
Walter Block: The Phillips curve slopes upward, not downward. You mentioned textbook, I have to tell you another story that’s your buddies Stiglitz, and the minimum wage. Stiglitz has a textbook and in his textbook he has the usual stuff on the minimum wage, pretty good.
And then he signed some [00:29:02] petition saying we should raise the minimum wage. So some very bright journalists said how do you reconcile what you wrote in the textbook and your support for this minimum wage in this petition? And he started talking and I must have read. Three times. I couldn’t understand what he was saying.
He is a magnificent, I don’t know how to say this politely, obfuscater, that would be a polite way to say it. He just rattled on and on about something or other, I couldn’t follow what he was saying, but he couldn’t reconcile what he wrote in the text book and his support for the minimum wage.
My PhD, the value of it has gone down because of Stiglitz. Becker, with all of his flaws, he wasn’t that bad, Stiglitz is horrible.
Saifedean Ammous: Yeah. He’s done an incredible job radicalizing me into a libertarian by just continuing to present this kind of [00:30:02] nonsensical case for government intervention in the economy.
I want to talk a little bit about your work. So let’s first begin with this horrific idea you have whereby you don’t believe in roads. Tell us why don’t you believe in roads?
Walter Block: Oh no, I believe in roads, I travel on roads. I live on a street, I go on highways, I believe in roads. I just don’t believe in government roads.
I think government roads are a problem. The main reason I got into this, I had a whole bunch of articles and then I put them together in a book, I think it came out in 2009. Almost 40,000 people a year die on the nation’s highways. And to put that in perspective, how many people died in 9/11, only 3000.
How many people died from Katrina, only 1900. And those were one shot deals. But every year, something like 35, 38, 39,000 people [00:31:02] die on the roads. This is just horrible. They talk about police brutality killing black people, they don’t kill any 40,000 black people or people of whatever persuasion every year.
This is a horrendous death rate and nobody talks about it. So that was one of my motivations for it. Another motivation was a congestion, I guess I’m impatient, I don’t like to sit there, bumper to bumper traffic. I started this when I was in New York City and the Long Island Expressway is sometimes called the longest parking lot in the world because it has bumper to bumper traffic for about a hundred miles.
It’s just very bad. Okay. So what’s the usual analysis. What’s the mainstream analysis as to why we have these deaths? And they come up with all sorts of reasons, speeding and vehicle malfunction and [00:32:02] driver error and drunken driving. And I don’t know. The NHTSA, national highway traffic safety administration has I think 225 reasons why we have deaths.
Not one of them is because government owns the roads, not one that they go in the very minuscule things like how far away is the road from a hospital? Do the hospitals have helicopter ambulances or not? Because if they do things closer to hospital, you have less deaths than if the highway is far away from a hospital.
They get into all sorts of meticulous details as to what causes that, and they don’t mention government ownership. They don’t mention that at all. The way I look at it, it’s a matter of the difference between direct deaths and indirect deaths or explicit causes and implicit causes.
Let me argue by [00:33:02] analogy. Suppose we’re brought in to find out why a restaurant just went broke, and we’re all MBAs and we’re all up on the latest things, and we start making a list as to why the restaurant went broke. And we come up with a whole bunch of proximate causes such as the food is lousy, the waitresses are surly, the place is dirty, the location is horrible, it’s on a cul-de-sac and nobody goes by the restaurant.
Those are just proximate causes. What’s the ultimate cause? The ultimate causes that the manager or the entrepreneur didn’t locate the restaurant in a better place. Didn’t hire a better chef, didn’t hire a better waitress, didn’t hire somebody with a broom.
So you have to distinguish between the proximate and the ultimate causes. Yes, the NHTSA has a whole bunch of proximate causes, but what’s the ultimate cause? The ultimate cause is just as in the [00:34:02] restaurant, the management. Who’s the management? The management is the government that namely there’s no competition.
What you get is the rules of the road from Washington DC .You get one rules of the road for all the roads. Now, how would it be under privatization? See right now let’s just take speed because speeding is presumably, is actually a proximate cause of deaths. You go too fast and other things equal, the faster the worse.
Okay. So what is the present rule? The present rule is you have to do a minimum of 40 and a maximum of seven. Now, anyone going on any of the highways knows if you go 70 cars are going to know zipping right on you. Because most people are doing 75, 78, very rarely do you get anyone doing 70.
Would it be better [00:35:02] possibly if instead of the minimum of 40 and a maximum of 70, you had on my highway, the right lane everyone had to do 55, and the middle lane everyone had to do 70, and the left lane everyone had to do 85. Would that be better? And the answer is we don’t know because we can’t experiment.
Look, the reason we have pretty good shirts and the reason we have pretty good pens is different people try to make sure it’s in pens in different ways, and then we find out what’s the best way. Maybe it shouldn’t be 55, 70 and 85. Maybe it should be 60, 70, and 80, who knows? But we can’t do anything like that. Whereas if you had a road and you did 55, 70 and 85, and I had a road and I said, 50, 60, and 70, then we’d see.
Maybe there’d be fewer deaths on my road, and I say everyone come to my road, nobody go to your road and we’d have competition. Another thing that really is problematic right now is that it’s entirely [00:36:02] legal to do 70 in the left lane. 70 is the maximum speed, and yet if you do 70 in the left lane, everybody that’s going to go passing you on the right side.
And maybe it’s lane changing that is conducive to deaths. So we don’t have competition. Competition makes a better product at a cheaper price. And all I’m trying to do in this book is come up with examples, like with the speeding as to how this could work or let’s take drunken driving.
Yes, drunken driving probably causes deaths. Well the government is in charge of getting rid of the drunken drivers and how well are they doing? Not that well. Now maybe on my road, if I found a drunk driver, I wouldn’t give them a fine of a hundred bucks. I’d take his car away. Maybe I’ve set up a rule to the death penalty, or I don’t know what I do.
Who knows, it’s my road, I could do whatever I want. [00:37:02] And if you’re caught drunken driving on my road, maybe I’m going to be very draconian. Maybe that’ll save more lives. Do we know? No, we don’t know. We’re just economists, we’re not road engineers or road managers, but we are economists. And we know as economists that competition brings about a better price, a better product at a lower price.
And so the first half of my book on this would be how could competition make things better? And the second half is objections. Like maybe you have a house on the road and all of a sudden he’s going to charge you a million dollars every time you want to get out of your house or get back into your house.
And he’s going to trap you in there, and I had a whole bunch of objections to the road privatization hypothesis. And my estimate is that right now some [00:38:02] 40,000 people die on the roads. And my estimate is that 10,000 people would die if we privatized it and where do I get that number from? What I did is I extrapolated from areas where public and private both work in parallel. For example, in post office you have private and public and in education you have private and public.
And in those cases, the private is usually three times more efficient. So I extrapolated and I said that we’d have many fewer deaths. We’d still have some deaths, unless we had a speed limit of 20 miles an hour or something like that.
But the death rate would be a greatly reduced and the congestion. We’d have peak load pricing. We have peak load pricing in hotels and resorts and restaurants, namely during the peak you charge more, movies charge less for a [00:39:02] matinee on Tuesday afternoon, rather than Saturday night. During the morning rush hour in the afternoon rush hour, you jack up the price and you reduce the traffic congestion.
So that would be a five minute summary of my use on roads.
Saifedean Ammous: Yeah, obviously it’s a bit of a running joke on the internet, it’s the final trump card that statists throw at us Bitcoiners that this seemingly impossible engineering challenge to solve. A bit of dirt that connects two places to one another.
Walter Block: By the .Way, I forgot something, when we first started with roads, my research goes back to England in the 5th century, somewhere in there. And also the revolutionary times in in the 17th century and the 18th century, those first roads were all private roads. They were called [00:40:02] post roads and they would charge based on how many horses your wagon had?
They wouldn’t even charge based on how wide the wheel was. If the wheel was wide, think steam roller. They would charge less if the wheel was very narrow, I think ice skating would put a rut in the road because the roads were all dirt roads. They would charge more but then the government refused to to stop people who were riding for free, free riders or thieves.
So the idea of private roads is not only theoretical, a lot of it is theoretical, but we actually had private roads in the revolutionary times in our history.
Saifedean Ammous: Yeah. Historically when was the move toward roads becoming something that is government prerogative.
Walter Block: Oh, probably in the 1800s, early [00:41:02] 1800s. I forget exactly.
Saifedean Ammous: And what is the main rationale? What is the legal justification for the idea that the government should be the one that owns the road? There’s The economic rationale we get is that this is just a natural monopoly because these roads would extend everywhere.
And so everybody’s going to have to use them and there’s no alternative to using them. And so therefore, because it’s a national monopoly, only the government can do it. But of course, I find this example with all examples of monopolies that governments bring up, you’ll find that there’s nothing really natural about the monopoly.
The monopoly is natural only because the government enforces it with a gun. So in many places, electricity is a natural monopoly because there’s only one national grid operator. But if you had a free market, then you might, you will arguably get many others. So what is the rationale in the [00:42:02] case of roads?
Could you make the steel man case for why government is necessary for roads?
Walter Block: Yeah, they call it a public good. And public good means only government can do it or monopoly as you say. The way I like to look at this is the analysis of long, thin things. So what’s a long thin thing? One long thin thing is road. Another long, thin thing is electric wires. Another one is water pipes. Another one is sewage pipes. Another one is telephone lines before we had cell phones. So here is the situation. I now have an acre sorry, I have a square mile. And then a square mile has 640 acres in it.
And I’m going to sell these 640 acres, one house per acre. And if I just sell it as is, nobody’s [00:43:02] going to want to buy it, or the value of it will be very small. Because the people then, I sell you an acre and there’s no water connection and the no sewage connection. And there’s no electric connection. No, no connection of anything.
I know, no roads. So what I’m going to do is I’m going to put in the roads between each of these 640 acres, and I’m going to put in telephone wires, and I’m going to put in a water and sewage lines and electric lines and all that. And now I can sell the stuff. To a much higher price because now you can put in a house and you can get there and you can leave.
And and what I might do is perhaps maintain the ownership of all these things and have a sort of a homeowners association, or I might just sell it to you guys and you decide who’s going to manage the roads and who’s going to make the rules, and even sewage sanitation collection.
Because [00:44:02] if each of you, 640 people has to deal with a sanitation company. It’s going to be very inefficient. Whereas if I get one instead of 15 guys and each one goes over every 15 pounds and picks up their garbage, that would be very inefficient. And then, there might be a two year contract and then the majority of the homeowners can decide on replacing any of these providers.
So I think the answer is it’s not a public good there, ain’t no such thing as a public good. Everything is a private good. And as far as monopoly is concerned, here again the Austrians and the mainstream are diverged. The way the mainstream look at monopoly is number of competitors. So if there’s only one grocery in duct Berg Arkansas population, 500, that’s a monopoly, which is [00:45:02] just silly.
One barber shop in the town is a monopoly, is just silly. Whereas the proper way to look at a monopoly is legal entry. Can another barbershop open up legally? Then it’s not a monopoly. If it can’t, then it is a monopoly and it doesn’t matter how many people there are.
So Austrians would tend to be against antitrust law, unless it’s government, what the end I trust people should do is get rid of the U.S. post office. That’s what they should do. They should be limited in doing that.
Saifedean Ammous: Yeah. The exact shape that you say that this will take, if we do end up with a system of private roads, the exact shape is not something that we can know.
But it is something that will emerge from competition. We see this in all goods, if people [00:46:02] have the option of providing different goods, then they will try different ways, and the ones that become more successful will become more popular and they will become copied. But instead we have almost like a monocrop of the entire world following this model of just believing what traffic experts say needs to be done with roads.
And I think the curious thing of course is that the failures of this monopoly model are usually attributed to being something that is inherent about roads, and then justifying more government intervention. So congestion is presented as the example for why the market would fail. This is a congested good.
The market won’t be able to provide it. There’s no way to keep people out. Therefore we need the government to provide it. But in reality, in fact, it is the government providing this good for [00:47:02] free wherein the cost is paid by people through taxes, not through consumption. So that regardless of how many times you consume it, you pay the same thing.
Then that encourages people to over-consume. That encourages people to drive in times when they when they don’t really value the driving, and then they end up clogging up roads for others. If you had a more free market, this people would charge more for congestion and they would get rid of it.
Walter Block: Absolutely. Let me give you another example, on my road, if I ever owned the road and there were accidents, what I would do is I would put up a giant cross or a Jewish store, or the Mohammad religious symbol and I’m not talking about five feet tall, I’m talking about 50 feet tall, as a warning that this is a dangerous part of the road, and you gotta be careful.
Now with regard to being entrapped on your [00:48:02] road, see right now when you buy a house, what you do is you buy a title insurance and make sure that the guy who is selling you the house is the actual owner of the house. You would then get access insurance.
You would get a contract before you bought a house from the road owner to make sure that he’s not going to jack up the prices higher than for anyone else. And he would have every incentive to give this to you because he wants you to locate on his road. He wants people to be on this road so that people travel on his road so he can charge more for it.
So this whole idea that they’re going to trap you on in your house, or keep you out of your house is just silly. People will tend to make contracts on the road. The road owner would obligate himself not to do that. Otherwise he wouldn’t get any people locating on his road.
So here is just one more example of how we might induce that with religious symbols where there’s deaths, and there will be even in private roads, there’ll be [00:49:02] some, there’ll be many fewer. And also with this access insurance rather than a title. In addition to title insurance.
Saifedean Ammous: Yeah. I think this pretty much settles it. The case is pretty compelling and it’s quite amazing how people continue to view this as a checkmate against libertarianism.
But I wanted to move on to your other book, Defending the Undefendable. Now this is a book that Friedrich Hayek said of this book, he said Looking through Defending the Undefendable made me feel that I was once more exposed to the shock therapy by which more than 50 years ago, the late Ludwig von Mises has converted me to consistent free market position. Even now I am occasionally at first incredulous and feel that this is going too far, but usually find in the end that you are right. Some may find it too strong a medicine, but it will still do them good even if they hate [00:50:02] it. A real understanding of economic demands that one disabuses oneself of many dear prejudices and illusions. Popular fallacies in economics frequently express themselves in unfounded prejudices against other occupations. And in showing the falsity of these stereotypes, you are doing a real service, although you will not make yourself more popular with the majority.
I think this is a great summary of your book Defending the Undefendable, which takes a look from essentially an economist’s lens at trying to understand the economic motivation for people to do certain things and therefore why people do those things and to go away from the kind of.
Almost ingrained knee jerk reaction against these kinds of ideas. What was [00:51:02] the main thesis of Defending the Undefendable what you trying to do from writing that book?
Walter Block: Before I get to main thesis, let me just comment on what you read of Hayek.
When I read that, he sent it to me in a letter, I asked for a blurb and boy, oh boy, did I get a blurb. I thought he was drunk when he wrote this. He’s comparing me to Mises. I’m not God, I’m a follower of Mises and of Hayek, and the book came out in 76 when I was, I dunno, 35. And even now I’m still not Mises. I’ll never be Mises because Mises was spectacular. Mises and Rothbard are Mozart and Bach of economics. And I’m just a good listener of Mises, Hayek and Rothbar, Bach and Mozart. So I thought he was drunk when he wrote this, but I was very pleased. Hayek [00:52:02] comparing me to Mises, this is amazing. Another problem that I had with this is that I’ve written several articles, criticizing Hayek.
His book The Road to Serfdom where I thought he gave away half the store, he was too nice to the socialists, he compromised too much. And then I felt guilty. I felt because I’m biting the hand that feeds me. The great Hayek was nice to me and now I return his niceness with an attack. And then I reconcile this because I welcome my students who criticize me and I re I was never a formal student of Hayek, but that was the relationship that I had with him.
He was my teacher, I was his student. And if I can welcome my students criticizing me, and I do, he can then welcome me criticizing him. So I reconciled it that way, but I still felt a little awkward in criticizing, [00:53:02] and not only The Road to Serfdom, but the hayekian triangle in macro economics and Austrian economics.
I’ve criticized the triangle, which mainly it was his his way of illustrating the Austrian business cycle theory. Okay, now that I commented on that, I guess the thesis of the Defending the Undefendable, and by the way, here is Defending the Undefendable one, which came out in 1976, here is the fending offendable to which, and I got a foreword by Ron Paul, which I thought is very akin to Hayak and here is my Defending the Undefendable 3.
So there are three volumes of this and each one has got 30 or 35 chapters, and now I’m working on Defending the Undefendable 4. So let me translate your question from what is my thesis in defending [00:54:02] one to what is my thesis in all of these books? My thesis is that we have to distinguish between morality and legality.
And there are certain things that are immoral and yet should not be illegal. And libertarianism is a theory, not a morality, but a theory of legality. So we as libertarians are logically obligated to defend everything that should be legal, even though it may or may not be moral. For example, let’s take prostitution.
Now, a lot of people think that, and I also think that the proper way for people to interact is not buying and selling sexual services. Look, I have a mother, I have a daughter, I have a wife, I have a sister. I wouldn’t want them to be prostitutes. I think prostitution is not good. I don’t favor [00:55:02] prostitution. I don’t go to prostitutes.
I don’t, I think it’s highly problematic from a moral point of view. But now it comes to the libertarian question. Should it be illegal? Should people who do this go to jail? And the answer is, from libertarian perspective, absolutely not. Because prostitution does not per se violate the non-aggression principle.
There are prostitutes who steal from their customers, but then there are plumbers and bakers who also steal. So that’s irrelevant. So the thesis of all three and the fourth book, as well as I am going to defend every activity that I can think of that is either problematic or immoral or highly controversial, or people hate it.
Sometimes with good reason, and yet should be legal because I think we libertarians have to [00:56:02] adhere to the essence of libertarianism. And the essence of libertarianism is not a theory of morality, it’s a theory of legality. And what it says is that everything should be legal, except if it violates the non-aggression principle. So murder should be prohibited by law, theft, rape, I don’t know, kidnapping also things like that, arson, carjacking, fraud.
Those should be illegal. No question about that. And I don’t defend any of that, but I do defend, let me have a list over here from defending one, and now as I read this list what you have to think about in the back of your mind is yes, these are immoral, maybe these are controversial, these are highly hated by everybody, but do they violate the non-aggression principle? My answer is no, they don’t.
So I have under sexual, the prostitute, the pimp, and the male chauvinist [00:57:02] pig. On the medical, the drug pusher and the drug addict. On the free speech, the blackmailer the slander, alive alert, denier of academic freedom advertiser. Personally yells fire in a crowded theater. I’ll help explain that one on there.
Outlaw the gypsy cab driver, the ticket scalper, the dishonest. And the financial, the non-government counterfeiter, the miser inherited money lender. Non-contributing a charity on a business and trade the Camacho in slumlord, ghetto merchants, speculator, importer, middleman profiteer. Under ecology, the strip miner, litterer and waste maker.
Labor, the fat capitalist pig, employer, scab rate burner rate Buster and employer of child labor. I say that many of them are, and I’m not going to read the other two books unless people raise those issues because they’re there another, maybe another 75 issues. And my claim is that all of these are reviled, hated, [00:58:02] immoral, very controversial, but none of them violate the non-aggression principle and therefore they should be defended in the limited sense that they should be legal.
Not in the sense that they are good or virtuous and that we should all become prostitutes or something like that.
Saifedean Ammous: Yeah, I think this is really for me, why I think of libertarianism as being almost synonymous with adulthood. In the sense that you need to just be able to develop this understanding of the idea that just because you don’t like something.
Does not mean that people should take guns and go threaten the lives of people who engage in those things, understand the distinction between not wanting to do something and wanting to initiate force against the people who do it.
And it’s the fatal [00:59:02] flaw of the statist mindset, the conflation of those two things. The idea that I think drugs are horrible and therefore just because I think they’re horrible, and if a majority like me thinks they’re horrible, then it becomes natural and normal and justified for us to hire people to go and initiate violence against people who take those drugs, which is, it does not follow. The initiation of violence against people who are doing something that is peaceful, that does not hurt anybody is a bad thing in itself.
It’s immoral and it can’t be justified. I, there is no argument for it. And I think it’s really maturity to be able to arrive at this level where you can understand that how people can do immoral things that are bad for them, or they can do, things that are bad for their health.
They could consume substances that are destructive for their body. And I don’t have to approve of it, but [01:00:02] I don’t have to make it my problem. I don’t have to, and I can’t initiate forcing, or support the initiation of force against it. And in fact, this is really what makes a civilized society possible, where you don’t go around trying to enforce the rules of behavior on everybody, because that entails violating their rights to their own body and their own property.
Walter Block: Yeah. We have to distinguish between hurting people and violating their rights. We are allowed to hurt people. We’re just not allowed to violate their rights. Let’s say I ask a girl out for a date and she says no. She hurt me, I feel diminished. Is she allowed to do that? It’s not nice of her. She should really date me or dance with me or whatever it is, but she has a right to decline.
Or to just take a very pedestrian plebeian example. I [01:01:02] bought this shirt for 10 bucks. I thereby raise the prices of all shirts by an infinitesimally small amount. I shifted the man curve to the right of shirts. I hurt everybody by making them pay a little bit more. Do I violate the non-aggression principle, of course not.
So you’re allowed to hurt people, or I don’t ask the ugly girl with dance, and nobody asks the ugly girl to dance. I think people should, but that’s a different issue. We’ve all hurt her, should this be illegal? Are we obligated, legally obligated to ask her out for a dance or whatever it is? No.
You have to distinguish between rights violations and hurting people. We are allowed to hurt people. Look, I get drunk and the GDP goes down. I’ve heard everybody because I could have been making more widgets. I’m in Laurel for getting drunk [01:02:02] and maybe there are people who rely on me, but to get drunk in my own home, should not be against the law. Even though not only do I hurt myself, but I heard other people who are counting on me to do things and now I can’t do them because I’m drunk.
Saifedean Ammous: Yeah. So what is your case for the speculator? Why is the speculator a good thing? This is one of my favorite ones. I think it’s a huge problem when people say, speculation is bad. Why is speculation bad and why is it not?
Walter Block: The the example I give is that not only is speculation not harmful, but it’s actually beneficial.
Cause what speculation does is iron out the price oscillations. And the example I use in the book is the biblical story of seven lean years in seven fat years. First we have seven fat years [01:03:02] and we have a food up to our own pits where we’re well fed. We got plenty of food and then we’re going to have seven mean years where a lot of people are going to die because the crops just don’t grow or for some reason or other.
So what does the speculator do? What the speculator does is he buys up food when prices are very low, and prices are low during the fat years, who’s got plenty of food. And what does he do with the food? He puts it in a barn or in a silo or in a basement or somewhere, he puts it there and he keeps it. And then during the linears he disgorges and he sells food.
Now during the lean years, there’s very little food around and the prices are very high. And now he’s selling food at a high price and people hate him. Cause he’s taking advantage of them by selling food at a high price. And yet what he’s doing is in the public good. Namely, what he’s [01:04:02] doing is he’s taking food from the fat years when we really don’t need it that much and saving it for us.
And then he’s giving it to us or selling it to us when we’re facing starvation. But he’s making a big profit, and he’s a hero. Not only is he somebody not to be reviled, but he’s actually heroic. That is if he doesn’t write, if he makes a profit. Now, if he starts selling food during the fat years and buying food to store during the lean years he’s going to lose money and he’s going to kill people but he’ll lose money.
And the point is, speculators who lose money don’t bother us too much because they lose money, they go broke. Or sometimes the government speculates and sometimes the government makes an error and they speculate in the wrong direction. And what they do is they cause great harm and also rights violation.
They’re [01:05:02] starving people. And but there is no market process that gets rid of them because if they lose money, they just raise taxes. So my defense of the speculator is that he irons out price oscillations and not only price oscillation, but quantity oscillations. He keeps us on an even keel.
If we have perfect speculation, then we have as much food during the lean and the fat years, we probably will never have perfect speculation living on the wrong side of the garden of Eden, but we have a lot less variation in the amount of food than we would otherwise have. So that would be the chapter on the speculator.
Saifedean Ammous: Yeah, I’ve always found this to be a very important fact for people to think about. That the only way that you can make profit on the market is if you are giving the world something valuable. So if you’ve managed to find a way to take something cheap and sell it to somebody who would willingly [01:06:02] happily pay you a much higher price for it, you must be doing something right.
And the case of profiteering from a natural disaster is another example of something like this. It sounds horrific that people are selling oil at this extremely high price in this disaster stricken area. But the fact that they’re selling it for this high price means that they have they’re doing people their service because people are willing to pay that price.
So somebody had to go through a lot of hassle and cost in order to secure this fuel to this area, and that’s why they charge a higher price. If you don’t pay them that higher price, it won’t be worth it for them to dedicate their own time and their capital to doing it. So the fact that they’re making a profit on the market itself tells us a lot about what they’re doing.
They are providing value.
Walter Block: Let me give you a real world example. I live in New Orleans and we had Katrina in 05′ and Katrina [01:07:02] really messed us up. A lot of people died not from Katrina, but from from the failure of the army Corps of engineers. It wasn’t Katrina, but the army Corps of engineers screwed up.
And by the way, guess what? They’re still in business. They didn’t go broke because they’re a government operation. Governor Blanco then had a rule against price gouging. If you raise prices. And the problem with that, she was trying to stop speculation, and the problem with that is right now, people in, I don’t know where Montana or Maine, have two motivations to come down in new Orleans and bring us orange juice or water or baby diapers or whatever it is that we’re running out of.
And one of them has been Evelyn and that’s all well and good. And God bless benevolence. I’m glad that they have benevolence and they did help us. But the second one is greed, [01:08:02] namely seeking a profit. And if we have a price gouging law that says the prices can’t be higher than normal.
Then that motivation for bringing stuff here is gone. But we were in dire straits. We needed all the help we can get. We needed all the motivations from the people in Montana and Maine and everywhere else in Mexico, got another M in there. And if we didn’t have price gouging, the prices would have risen to indicate a shortage.
And then they would have had two motivations to bring stuff here. And as they brought stuff here, guess what would happen? The prices would come down. The way I liken it is profits are like a cry for help in the wilderness. When I’m lost in the wilderness, what I want to do is yell help very loudly, price gouging laws are decibel control laws and they can only go very softly [01:09:02] or not at all because the economic signal for help is a high price.
That shows where in dire need and with a law that stops price gouging, we can’t yell for help economically speaking. How is that helping us? It’s not helping us at all.
Saifedean Ammous: Yeah. This is the superficial idea in interventionist economics. That if you just suppress the signal, then you can eliminate the underlying cause.
If you just stop somebody from shouting, you can stop the piranha eating their foot from hurting them. This is the rationale. So yes, of course it’s disastrous that New Orleans is in a situation where they have to pay say 400% premium on oil. Yes, it is a disaster, they were just struck by a disaster.
And this [01:10:02] was one of the manifestations that oil is so expensive. However, this is the current going rate for getting this in New Orleans. Make people pay less. If you force people to pay less, you will not be able to mobilize as much of the infrastructure that would be mobilized if you let people charge fully.
If people could charge fully, somebody from a nearby town will be able to move their machines and to go and help with work in the city. And because the city needs these machines much more than it’s neighboring cities, it’s a good thing that the price rises, so that the people who have say a truck that can pick up litter instead of their trucks sitting idling in the town next door.
Pay enough to justify the guy driving an hour over, and [01:11:02] then you will get stuff removed from the street. Then you’ll get the city back to functioning. So the return for that money is very high. the reason people are paying a lot for it because it’s worth a lot. It’s going to bring the city back to functionality, which is a huge deal.
And again, the naive non-economic idea of thinking here is, oh no that’s not nice, let’s just ban the higher prices, and then the debris and the trash and the destroyed infrastructure will all just mend itself, magically through the power of positive thinking.
So the speculator, I think I would say that a speculator is defendable morally as well, not just defendable legally. So it is legal for people to buy cheap and settle [01:12:02] expensive. It’s also defendable morally, as we were saying, some of the things that you mentioned are arguably morally indefensible. You would not support them, like maybe being a drug addict or being a prostitute, and yet you still think they are legally defendable.
So what is the case there? Why do you think it should be legal for people to harm themselves with drugs and prostitution?
Walter Block: Because it doesn’t violate the non-aggression principle. If a man and a woman go to bed together with no pay, that’s okay. And now money changes hands, and that should make it problematic?
We’ll take another case, markets in used body parts. If I have no kidneys that are functioning and you have two kidneys that are functioning and you give me one, that’s fine. No one would object to that. People would consider you heroic [01:13:02] for donating a kidney to me, and you only need one and I’ve got none and you’ve got two. If you charge me for it, and I’m willing to pay for it, all of a sudden this becomes highly problematic and people become indignant because money changed hands. And yet the same thing occurred, the one kidney went from your body to my body. This is sort of an anti-market bias. Why? Just because money changes hands.
Okay, in the sex thing, I understand. I think the ideal love romantic relationship is not one explicitly for money. Although usually the husband works more than the wife and supports the wife and kids. And it’s the same with drugs. The question is if I sell you marijuana or cocaine or heroin, or I buy them from you, did we violate the non-aggression principle?
Did violence, did an uninvited border [01:14:02] crossing occur? And the answer is no. Therefore we should have legalized drugs. Now that doesn’t mean we favor morally using heroin. I think morphine is fine if you have last stage cancer, end stage cancer, and the morphine no longer works and now only heroin will work, what the heck. Even from a moral point of view, I would have no objection.
But ordinarily, if you take cocaine or heroin or any of these things, you’re ruining your life and you’d be well advised not to do that. However, did you violate anyone’s rights by polluting your body with medicinal crap or pharmaceutical poison?
It’s your body. Feminists say my body, my life, or my rights. You should be able to put crap in your body and not only drugs, but well [01:15:02] sugar. Suppose you weigh 450 pounds based on eating a lot of sugar, that’s not good. Should we ban sugar? No.
Saifedean Ammous: Tough one for me.
Walter Block: So I think that we can defend the legality of these things and whether we defend the morality or not is not a libertarian issue. We libertarians have no views qua libertarians on morality. We have plenty of views on morality as individual people, just like everyone else, but qua libertarian we are limited to our views.
The only question that a libertarian asks is should X be legal? And the only answer he gives is yes, it should be legal if it doesn’t violate the non-aggression principle. And no, it should not be legal, it should be prohibited by law if it does violate the non-aggression principle.
Saifedean Ammous: Yeah. And I think obviously this [01:16:02] a priori analysis, and the idea of rights is obviously the correct analysis here, but there is also, not to go all consequentialist on you. But I think if we think about the consequences of prohibition and criminalization of those things, we begin to understand why, you get to see the bigger picture of why it makes more sense that we live in a world that respects people who do things as long as they don’t aggress, no matter how objectionable we find those things.
It’s workable for a human society to live together in peace and harmony and civilization, if we’re able to accept each other’s non-aggressive vices. But it’s unworkable if we want to try and regulate each other’s vices. It’s [01:17:02] unworkable for us to try and live where we need to impose a moral code of, sorry not a moral code, but a behavior code on everybody. Where everybody needs to smoke this or not smoke that, or drink this or not drink that. Everybody needs to do this and do that.
It’s just a recipe for tyranny and conflict and needless suffering. It is the problem, the problem with drugs, it’s quite telling that really the biggest problem with drugs is not so much the impact that they have in your body today. It’s the criminalization aspect of it.
Criminalization ruins a lot more lives than drugs do.
Walter Block: Absolutely. The best analogy would be alcohol prohibition. At one time, people would kill each other over alcohol. You had gangs organize around alcohol. And you had this thing called bathtub gin, namely poisonous alcohol that killed people.[01:18:02]
And nowadays we legalized alcohol. It’s still a problem. People get drunk and they shouldn’t get drunk, but nobody’s killing anybody over it. And the quality of the stuff is impeccable. There’s no more bathtub alcohol or bathtub gin or anything like that. Right now, more people, as you eloquently say, are dying not from these illicit drugs, but dying from the criminality around that.
Mainly people are shooting each other and look in New Orleans every day. Maybe not every day but every week there were people shooting each other over drug turf. If it was legal, if you could go and buy heroin in the store in the pharmacy store, nobody would be shooting each other over that. That whole problem would disappear.
So I think you’re absolutely right in saying that from a pragmatic point of view, not just a an ideological point of view, but even from a pragmatic utilitarian point of view, these laws are very bad as they kill people unnecessarily. [01:19:02]
Saifedean Ammous: Yeah, it is the aggression. And no matter how much you think drugs are a problem, I think the far bigger problem is the criminalization because the drugs do not involve aggression.
Somebody voluntarily decides to grow them and then somebody processes them and then somebody sells them to somebody else and they go down the supply chain until they make it to the end consumer all along the line. Everybody there is voluntarily choosing to take part in this process. And so nobody is hurt.
And if they’re hurt by their own volition. They chose to. A lot of people hurt themselves as you mentioned, by eating junk. I know a lot more people whose lives are ruined by junk food than those whose lives are ruined by illegal drugs. And yeah, sorry go ahead.
Walter Block: Let me just mention one caveat. We’re not talking about children. Children are a [01:20:02] separate issue. You sell drugs to children, you ought to go to jail. You engage in prostitution with children, that’s child abuse, you ought to go to jail for that. The children are, how shall I say that, a unique problem for every political philosophy, including libertarianism.
So when we say we should legalize drugs or sex or this or that, we’re talking about consenting adults. Robert Nozick once had this beautiful phrase, he described libertarianism as capitalist acts between consenting adults. That’s a very nice way to put it because if you do any of this stuff with children, and now there’s a question who’s a child, is a 15 year old a child, or a 12 year old, 17 year old.
That’s a different issue, and libertarians nor anyone else have a definitive answer to that. But you do something to a clear child, 11 years old, you’re a criminal.
Saifedean Ammous: Yeah, absolutely. I think that follows from the fact that [01:21:02] children are, you agree with Rothbard that children are property of their parents, right?
Walter Block: I’m a big fan of Murray on many things, but not everything. I have a little different view. Murray says that children should have the right to run away, and Murray never had any children. I have a son who’s now 44, but when he was four, he was always running away. His little legs, he just wanted to run away.
And my wife and I didn’t want him to run away. And there was no child abuse or anything like that God forbid. Yes, there are movie actors who are 10 years old and want to be divorced from their parents. And that’s okay. I would just say as long as a judge approves of that, but there has to be some sort of protection.
A 4 year old just can’t run away from his parents, and we support that. [01:22:02] The parents are the guardians, and if the guardians stop guarding you get this, who are those Christians that won’t allow a blood transfusion?
There is a second of Christian who would not allow their children to have blood transfusions, even if it’s to save their lives. Jehovah’s witnesses. I would say that those people are criminals. They shouldn’t be put in jail, but the kids should be taken away from them because if the kid needs a transfusion, otherwise it’s going to die, and let’s say we stipulate that arguendo. If the parents say no, we’re going to limit ourselves to prayer, and the medical establishment is a hundred percent saying no, this kid will die without a transfusion, and if he has a transfusion, he’ll live and he’s four years old and the parents won’t allow a transfusion.
Then I would say that the [01:23:02] state or a private defense agency or somebody, a hospital, somebody should take that kid away and give them a transfusion against the parents will.
Saifedean Ammous: But, you see the slippery slope here.
Walter Block: I do, but I stand on my side of the slope. A key element of the parenting is guardianship.
And if we can stipulate that you’re not a good guardian if you don’t allow a blood transfusion, then you shouldn’t deserve the honorific of being a parent anymore, at least for that regard. You have the kid back because apart from that, one problem that the Jehovah’s witnesses are fine upstanding individuals. But that kid should get that transfusion and he should stay alive.
Saifedean Ammous: I think there’s another similar example, which is vegans. A lot of vegan raised their children as vegan and children cannot grow up vegan. It’s massively [01:24:02] harmful for them. And that is a case to be made that maybe they should be taken away from them. But I disagree with you because I think I’d rather live in a world in which we have everybody understand that the authority of the parent over the child is non-negotiable.
Because otherwise, if you start compromising it for these once in a million rare edge cases, then the same busy bodies that like to capitalize on everything are just going to take this to extreme lengths and then you’re going to be dealing for each one case of these extreme outliers, you’re going to be dealing with a hundred cases of lives ruined by overanxious bureaucrats looking to abuse their authority.
Walter Block: No, I agree with you entirely. We’re really into act utilitarianism versus rule utilitarianism, and I’m the act utilitarian, you’re the rule [01:25:02] utilitarian. And I agree with you that the parents on average, are 99% better guardians of their kids then the government. No question about that. And if it was a choice of all or none I would go with you, however I don’t see why we can’t say arguendo stipulate in this one case, let’s go the other way, because here it’s a clear violation of rights.
Now look, there is such a thing as child abuse, there are parents that burn cigarette cigarettes out on the skin of their three-year-old kid. And if they do that, I think they should deserve a real low level of hell for doing that.
But I agree with you that better than two kids get cigarette burns and die from cigarette burns on their body, then that we let the government involve, because the government will kill many more kids then the parents will. [01:26:02] But can’t we have our cake and eat it. Can’t we say yes, as a general rule the burden of proof is on anyone who wants to take a kid away from the parent.
Fine, but there are certain cases, especially if we have a private court where the abuse is, so heinous, cigarette burns on the kid or not having a blood transfusion, and we want to save that kid, I don’t see why we can’t have our cake and eat it, we can’t have both, at least theoretically.
Now from a practical point of view, you might well be right, and we can’t have our cake and eat it. And then I would agree with you. We go with a parent rather than the state, because the parent is on average a way better guarantor of the safety of children then is the government.
Saifedean Ammous: Yeah. I I think I definitely agree on that regard.
Walter Block: We can agree to disagree.
Saifedean Ammous: No, it’s just [01:27:02] I tend to think that it is all or nothing. It’s either we don’t have a mechanism for overriding the choice of the parents or we do. And if we do, then it’s just going to lead to all kinds of questions. But perhaps I think you could justify aggression against the parents by individuals.
Walter Block: Look, I agree with you that if it is all or none, I’m on your side.
Saifedean Ammous: But I think maybe the way that you could take the kids from the parents is if individuals choose to carry it out themselves, rather than coaching it in a collectivist language and having the government build it.
I know those kids that are being abused, I’m going to go and take those kids and I will fight their parents for [01:28:02] instance.
Walter Block: Look, it’s been an hour and a half and I’m running out of steam. I’m not as young as I used to be, I’m 80 years old. This was really very enjoyable for me. And I hope it was beneficial to you guys.
And I think you’re not running out of steam. You’ve got a lot more, maybe in a month or two, we could do part two of this, but right now, I think I’d like to wrap up.
Saifedean Ammous: Okay, not a problem!
Walter Block: Now you’ve been asking me a lot of questions, so let me ask you one.
Saifedean Ammous: Sure.
Walter Block: I see on my screen about 15 people. Is there like a group of you or who am I dealing with?
Saifedean Ammous: So I do the seminar for my website academy.saifedean.com.
So I left my university job. I now teach online on this website. I teach courses in Austrian economics and the economics of Bitcoin and the courses are recorded, so people can take them at any time. And then we have these two weekly seminars. One [01:29:02] seminar is just a discussion usually, and then one seminar, we have a guest and this time, this was so enjoyable I just noticed that it had been an hour and a half, but usually I try and bring in the other participants to ask question and they’d have questions to ask you as well, but this time you and I got into child ownership and then we got dragged into that. But yeah, you’re right we’d love to have you again if you’d like.
Walter Block: Oh, I’d like very much, and sure, maybe in a month or two, let’s do it again. And maybe just do a half hour of you and I and an hour of distraction with the whole gang. So thanks for having me on this, I really enjoyed it and I feel I made a new friend!
Saifedean Ammous: Thank you, sir. Thank you. It’s a pleasure and an honor to be talking to you. Thank you so much for joining us, have a good day!