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Property and Freedom Podcast, Episode 075.

This panel discussion is from the 2011 meeting of the Property and Freedom Society: Hans-Hermann Hoppe (Germany/Turkey), Mateusz Machaj (Poland), Philipp Bagus (Spain), Doug French (USA), Thomas DiLorenzo (USA), Nikolay Gertchev (France), Discussion, Q&A. PFS 2011 Playlist. Transcript below.

Transcript (youtube/Grok):

Introductory Announcements

0:02

Yes we want to be done by 5:15. If we finish earlier then again keep in mind that you round up your troops because at 6:30 we want to load the buses to go to the fishing village.

Audience Question to Philipp Bagus on Future Book

0:42

Andy Duncan from the Department Centre in the UK: I’d like to ask Professor Bagus, this morning particularly the second half I thought was fantastic. Is that lecture going to be the basis of your next new book called Banksters? And if not, why not?

1:00

[Music]

Philipp Bagus Response

1:08

So my speech today was for some part based on this maybe not the standard analysis of the extent of the mainstream comparison of possible future research. Why not would be always of course always a time factor many things many things to do but it’s not impossible.

Unknown speaker Question on Economic Growth Despite Monetary Issues

1:44

This is actually addressed to everyone who carries this question. I listened this morning with attention to Professor Hoppe and Professor Bagus and some of the others who are talking about the worthlessness of the currency, the government monopoly of the currency, various dubious banking practices. I found myself agreed with everything that I heard. On the other hand I’m also trying to account for the fact that the United States in the 20th century saw an enormous increase in living even from the 1950s into the last decades of the 20th century. Disposable income rose specifically and so forth but still the disposable income does rise consequently this period of time.

The United States has made one of the highest standards of living in the world and it continues to happen despite the fact that the dollar has run into problems that has become increasingly devalued. It would seem to me that given the economic problems that were pointed out the United States has done very very well. It helped to explain the successes of the American economy given the fact that hampered by a bad government and by increasingly devalued money and questionable banking practices.

Hans-Hermann Hoppe Response

I think this is an example of a postponement of fallacy. What first of all the same sort of banking practices are in place in almost all countries not just in the United States and Germany forth. Second it is something like this we can say look in the 19th century standards of living were significantly lower in the entire western world as compared to what they are today. At the same time we have seen a growth of government also throughout the entire western world from the 19th century up to this day. So does it follow that because the growth of government societies in western Europe grew obviously they grew we are richer?

Was the fact that government grew the cause for the fact that we are richer? The answer is no. Despite the fact that we had all these monetary mismanagements we didn’t grow we would be infinitely richer if it were not for the fact that these types of policies had been implemented and are still being conducted day in and day out. So it is just the illusion he sees two things going down to see that one is the cause.

I agree with him many many times but I’m still astonished by the success the resilience of the American economy given the incompetence and dishonesty of the government. The way to describe despite this fact you know we have not been like Egypt like other countries we have done enormously well with what seems to be incompetent and in many ways. Western Europe the United States have a bright population even up to this they have a pretty good work ethic still the Germans continue to work very hard despite the fact that muscles of money is siphoned off by countries like Greece and Spain. So it is an expression of the ingenuity of German businessmen of American businessmen of Dutch businessmen and businessmen and many many other countries that have made these things possible.

Markets do miracles they find a way around all sorts of obstacles that are put in their place nonetheless those are obstacles. Without them of course the performance would have been even much better.

I’m inclined to believe basically in the thesis that Richard didn’t put up this this has something to do so to speak with the intellectual capacities and capabilities of various populations. We are lucky that we still have this type of population unfortunately the performance in these areas is also on the decline.

I just want to have one interesting thing as a side note even in the mainstream literature it’s recognized that the gold standard the classical gold standard even though it was not a perfect system or it was not the best system possible in the 19th century. The growth and at the end of 19th century growth in the United States was actually higher than it was in the 20th century. You can even read it in Simon Kuznets the Keynesian inventor of GDP and then Milton Friedman’s history of monetarist United States. So two classical mainstream economists demonstrating that actually growth in the 19th century was higher under the classical gold standard. Those economists or other economists using data they say that it was less stable environment but still they have admitted.

This is even more astonishing given the fact that of course it is easier so to speak for rich countries to save and invest then it is for poor countries to save and invest. So the growth rates were higher despite the fact that it was at that time given that the general population was poorer far more difficult to save and invest. It has become significantly easier now with standards of living being significantly higher despite the fact savings rates and support have actually declined even though it should be easier to save nowadays than it was 100 years ago.

Audience Question to Doug French on Ethics of Walking Away from Mortgages

9:06

I have a question for Dr French and I’m not sure whether correctly what we’re saying about walking away from contract because if the idea is that you can’t simply walk away from the contract my old concept of falls apart. So I would like to understand whether what we’re saying is that people who have borrowed money in order to buy a house or a rotten site and so on walk away because the lenders are banks that are financed by government and guaranteed by government legitimately such as Fannie Mae and Freddie Mac the United States. That is the reason why in this circumstance people can walk away from the contract. Or whether you believe that well I have pledged to refund or repay a certain amount over a certain amount of time but if the collateral that I gave falls in value then I’m not going to be there whoever is the lender.

I think that there is a I I’m not banker and I know nothing about banking but I think that there is a certain class of loans that are made with a mortgage and so on with a no recourse thought. That is painful this is why normal standing that you quote could have a walk away on investigative them because it’s actually not Morgan Stanley involved money but presumably the subsidiary of Morgan Stanley and very active properties and so on that they ran into. The rental income was not sufficient so the subsidiary went lost and there was no recourse on the current company. But a homeowner buys the property that property is not yielding any revenue so there is no way that the person can repay unless the repayment comes from their salary. So it is a salary that is pledged and therefore if you walk away you have actually broken your pledge to take some money out of your salary in order to pay back the bank.

Doug French Response

11:37

Well I would come back with this a number of people are grounded 30-year mortgages when they’re your age or my age. Clearly that borrower wouldn’t have 30 years to repay their loan they’re not going to be here to do that. In my view lenders were playing the market the real estate market just like the borrowers were. So while they want to stand on their high horse and say you need to pay until the very end they’ve taken this loan and sold it often many times. So this isn’t like you borrowed money from your brother-in-law not that anybody should ever do that but who has actually saved money for gone consumption to hand and done without the use of that money to allow you to do something with that money.

This is money that these are loans that originated sold in the secondary market and so and in some states there is not recourse California being one I think Arizona is another. So it varies state by state. There’s also other costs to this I’m not saying that somebody can walk away and not have costs associated with it. You’re going to get chased potentially for decades for the difference between what the lender sells it for in sale and what you owe. So this is not a walk away scot-free and forget about a situation.

The only thing I’m really addressing or trying to address is this morality toward people who in my view are making a reasonable economic decision that is the best for their situation. Most people don’t do this lightly. Most libertarians would not say that it’s ethical to necessarily pay your taxes but you do most people do but most people less than the amount of taxes that they pay. Yet we’re supposed to at the same time because we have this contract on a specific mortgage paid that when it makes no financial sense. So I mean there’s again it’s not to me it’s not an easy decision I wouldn’t tell any individual I wouldn’t advise them whether to do it or not.

But I just think that the moral outrage against these people I believe is misplaced is the point I’m trying to get across here. It is that it’s a perfectly reasonable financial decision. You pay a price in terms of your credit report although that’s been a lesson over time because it’s come out recently there’s been a study done that people who strategically default are actually better credit risks than other people. Because they use credit responsibly they under use their credit cards. They typically the other distinguishing feature about these people is they bought their homes recently and they have no personal attachment to it.

Many people they own their homes because they have a irrational personal attachment to that property. So but again it to me that the reason that I explored the issue is that number one libertarians had a reasonable argument on either side of it. Very vocal especially on the you must stay till the end of time. I was trying to think since I didn’t have a Murray Rothbard down the hall to go talk to about this. I tried to imagine if I went down to Murray and said close this question to him what he would say. That’s what I was trying to come up with.

Audience Question on Happiness Research

16:22

I think we should take this work on happiness rather more seriously than it was argued in your presentation. Please have this questionnaire of the general format would you consider yourself to be very happy very happy not very happy unhappy and that seems a very straightforward question I don’t think any of us here would have difficulty in answering questions like that and getting a score. Furthermore the validity of these studies is shown by the results which are that people who requires happy learners are less happy and the unemployed are particularly unhappy all that seems very sensible to me I think we should take it on board. I think a way to deal with this problem is to consider the implications of this we see where all this is leading to it’s leading to the conclusion that we should tax high earners more and distribute the proceeds to the poor and the unemployed. And is the indication of this work and that is not a not an implication which is particularly congenial to people like ourselves nevertheless I think the way to handle it is to point to adverse effects of a high tax high redistribution policy for instance such equality encourages high earners to immigrate to tax havens and such a policy giving greater welfare benefits now implied encourages them to remain unemployed.

So I think we should combat this position by drawing attention to the adverse effects of these forces rather than simply dismissing it all as having no validity.

Response (likely Nikolay Gertchev or Philipp Bagus)

18:55

Utility is cardinal and measurable which is not and then therefore you can make interpersonal utility comparisons so I think we have to argue with that also because that’s the main claim that they’re making. And I didn’t mention the effects of the welfare state which they tend to ignore in this literature so I would agree with you that that’s one way of doing it but I think it’s also important to park you against these the use the way they use these questionnaires to proclaim that social welfare and maximization is a real thing social welfare functions exist which they know. And Rothbard’s criticisms of people who answer questionnaires I think are still valid today so you have to take them with a big grain of salt. And I also believe you’re ridiculing stupid ideas too.

Unknown speaker Ridiculing Happiness Research

20:04

All incomes above 73 thousand dollars seven seven six thousand dollars would no longer make people happy now it every person who just gets a job offer for 74 would just decline it because this additional thousand dollars does not make me any happier anymore. And it’s an easy way to repeat this this whole concept I have not seen anyone who has done anything whatever somebody wants to offer me more for me a bigger donation I will not decline it because it will make me less happy than I was before their real nation every dollar or fighting I take it in my case this whole thing does not apply.

Unknown speaker on Relative Status and Happiness

21:25

Who wrote this but it was a similar survey of happiness in Mogadishu and they brought up them in particular they particularly mentioned a couple of butchers and these guys that basically chop up meat all day and they’re incredibly happy they’re poor they’re dead but they’re relatively very happy because their relative perception of social status is okay. And if you go to every other country it looks like there’s a higher correlation between the position of social status than the absolute number of the dollars so I’m just wondering if there’s anything on the social status perception versus just dollars.

Response (likely on Inequality Research)

22:01

Well the research that I reviewed for this talk was mostly on material inequality and there’s a lot more you know you can’t say much in a half hour but even the whole issue of inequality and use of these statistics is it’s very shady. For example in the USA we have I know some studies were done by some Fed economist actually looked at if you look at statistics on inequality by you know income distribution by the quintile of the distribution it looks flat for 100 years it hasn’t changed but it’s not the same people. The individuals who are in the lowest quintile in 1980 are not the same individuals over there in the year 2000 because there’s a lot of mobility and there’s a Fed study that showed that for example in a very high percentage it was over 70 of the people who were in the lowest quintile in 1970 were in the either the top quintile or the top two quintiles by 1994 so they weren’t the same individuals.

So there’s a lot of mobility and at least in the US economy and all of that is lost and when we just look at these statistics on income inequality in an aggregate sense these researchers were going to do this. Because the University of Wisconsin for about 40 years now has been tracking individuals and paying them to give them information on income and so forth and so they’re able to actually see the actual ability of real people and how they’ve done it’s a very big sample of thousands it’s socioeconomically diverse and so and that’s a much better way of looking at income inequality than just these raw statistics. And I doubt that the happiness researchers would do that because they wouldn’t get the same double core correlation coefficients that they do with their research they’ve got now.

Audience Question to Nikolay Gertchev and Thomas DiLorenzo on Pressure on Bad Ideas

24:05

Primarily for Nikolay Gertchev and Professor DiLorenzo I’m always surprised by the prominence of the bad ideas like the ones we were discussing is there any evidence that they’re the proponents of these ideas are feeling pressure from what seems to me like the growing influence of the Austrian school.

Thomas DiLorenzo Response

24:26

I will say this against Professor happiness is clearly making progress in the broadcast what has been become clear in the last two years since the financial crisis is that economists in mainstream economics has been increasingly more concerned with the real issues about public economics about economic policy impact growth what’s the business cycle so happiness research and psychology these areas are receiving less attention by economists within the mainstream themselves. I can say from this point of view maybe there is a link to make Austrian school because the Austrians were very strong explaining that the real world and the real phenomenon which we have been concerned for years. And I think it was one of the major American news magazines Newsweek and one of them had a cover story it says something like the failure of the economics profession I said something along those lines of course it didn’t mean the Austrians the Austrians were included in that but but the fact that they were totally clueless about the causes of the of the crash and then had nothing to say that was good about you know what to do about the crash but the Austrians did the Austrians and the other ones who predicted that the bubble especially the people associated with the Mises Institute like Mark and then of course what to do about it.

And so the mainstream people have paid a lot more attention to the Austrians and meanwhile interest in Austrian economics is booming you the Mises University which we hold last year had the highest attendance ever turned a lot of students back even though Doug had knocked down walls literally and they leased the student building to make room for more for more people. And the Mises.org website is the seventh or eighth most heavily trafficked economics website in the world even more it’s even busier than whitehouse.gov and in the Wall Street Journal as far as a number of people to read it. And so the obstacles are going in the opposite direction of the mainstream but mainstream is sort of always all these tenured professors who don’t really care they’re going to keep on writing the same articles to and of course it was the purpose of these two speeches to put pressure on these people you see the University of Zurich will now do after these two speeches.

Audience Question on Happiness Research as Psychology

27:19

Are quite important but the problem seems to be a kind of misleading fraudulent interdisciplinarity where psychology is mistaken for economics but if those researchers actually confined their work to psychology and stop claiming to be economists would you then consider this kind of psychology as valuable would it teach any valuable lessons about human nature. Because I find it quite possible that there are certain voluntary decisions which decrease reported happiness it shouldn’t be relevant politically but from a philosophical point of view might be quite interesting relevant to society’s phenomena.

Response (likely Hoppe or Bagus)

27:58

Well yeah utility is not measurable you can’t put a brain measuring machine on somebody’s head and then feed them a piece of candy and see how many noodles are listed on the side of this shoe that’s sort of the implication of the whole idea that utility is cardinal and measurable sort of a Frankenstein monster kind of machine but our brains do that as long as you understand that. I was just talking to one of the physicians in the group earlier about how he questioned his patients on how much pain are you experiencing on the scale you know one of my doctors does the same thing in a biology doctor and I just as long as you understand that this is not really that scientific I suppose it could be useful but it’s subjective. And you know there might be one culture where people are sort of not inclined to say I’m unhappy about anything there might be another culture and somewhere else in the world would be just the opposite they pretend that they’re always happy despite being unhappy.

And so that’s what Ron Paul meant but he said you can’t really rely on a truthfulness of questionnaires you have to observe people’s actual behavior as long as you understand those things that think of a great assault somehow it might be more or less entertaining to know what these people think about that issue. So if you find out that unemployed people tend to be less happy than employed people it’s not exactly a surprising result here’s the Austrians that unemployed people are actually far happier than people who make a billion dollars that would surprise me but then they have quite a few surprising results. Yeah but again if you take it just as an information of what they have said to a certain question but the entire purpose of this having this research is of course to find excuses for economic intervention and ultimately gives you destruction of all private property rights.

I think your point that it would make sense to have this entire psychology and economics field reviewed by psychologists also my feeling there is that psychologists will also find it quite doubtful psychology is not necessarily accepting also this viruses and positivistic approach so that will be already a first draw problem and then in interdisciplinary indeed it would make sense that only if the different disciplines are properly acknowledged it doesn’t make sense if you meld two disciplines into a single one losing what the goal of your research is. By the way even in the Property and Freedom Society statement first it is not said that the goal is multi-disciplinary service translational research fully acknowledging the status of different sentences different social sciences.

Audience Question to Doug French on Ethics and Non-Recourse Mortgages

31:27

My question is for French do you think whether he has nothing to do with whether he is moral or not for a person choosing to walk away from the platform from a loan but rather he just choose to consume now versus getting easier credit in the future and so my next question is about the non-recourse nature of mortgage in the U.S because I don’t know whether I’m right or not but I think it’s quite unique for the U.S that the mortgages are non-recourse then whereas in other jurisdictions like for example like Hong Kong we cannot just walk away from the loan because you need to sign a personal guarantee when you buy a flat something like that so what do you think is the cause of that non-recourse nature. What was the first question again well because you said the ethics of default but is it is there anything to do with ethics because it’s just a person I mean you choose if I walk away from the door but I don’t have any consequence so of course I would walk away from that like for example if I’m 18 years old and I walk away from home no problem but if I were 20 years old I walked away from a loan then I you know the rest of my life maybe I am very difficult to get credit so yeah just my question is whether it’s an ethical issue or not.

Doug French Response

33:16

Well I framed it in that context are certainly certainly the person who gave you the title of speech did but I’m gonna put it more as his individual business decision and you’re right if you’re a young person who’s concerned about future credit and how this will weigh on on your credit report your future job prospects those kind of things where possibly a strategic default will have a detrimental effect on your future then maybe that decision certainly is going to be different. But if you’re 200 200 000 underwater and you’re paying four thousand dollar house payments and the house will never recapture that negative equity and you can have the same house same neighborhood and either rent or buy and have a payment of fifteen hundred dollars I mean we’re talking about significant numbers we’ve talked about significant lifetime style choices here nobody’s gonna walk away for 200 bucks 300 bucks 400 bucks. What I’m talking about here is something very significant where people are weighing okay my credit report I’ve got perfect credit at 720 beacon I’m going to go down to 530 which is going to be very incredibly it may take me seven years to get back Fannie Mae is not going to do another mortgage if they’ve determined a strategic default for seven years so there’s a heavy price to pay.

But potentially a lot of people probably need to get out of the home ownership mythology that you buy a home it automatically goes up in value every year you can use it as a cash ATM to create money and that you will live happily ever after this buy your own home program was instituted in say 1918 by Herbert Hoover before he was even president. They created this whole idea that if we can get Americans trapped in their neighborhoods they will be more protective of their property more interested in local politics more interested in national politics so I would contend didn’t talk about it today talk about a lot in the book that government has fostered this idea that homeownership is it’s not only a good financial decision but it’s good for your country. And that’s why every president certainly every modern president George W Bush George H.W Bush Clinton you name it they all had this idea that everybody needs to own their own home and so I think everyone has fostered this idea of trapping people in this situation for many years.

Second question the non-recourse nature of the housing the mortgage in the United States why would that happen because other jurisdictions cannot why would somebody walk away if it is non-recourse is that the question because lenders if they don’t think they’ll have much to get from your other assets may make the business decision not to chase you for your additional assets and so that is a chance you’re taking so you’re gonna have a deficiency so you have a deficiency of fifty thousand hundred thousand when you walk away they’re gonna probably hang a judgment on you for that amount and big banks are not all that good. And every incentive if you’re creating money out of nowhere to do as much of it as possible and not necessarily be as careful as you should when you’re lending that money so on the collection side they may if they determine that okay it’s going to take me 50 000 to collect this if I’m chasing a hundred thousand and I think the guy’s got a boat and I think the guys I think his wife has jewelry et cetera et cetera then they may have something to chase if everything is tied up in a person’s home they may walk away. But the other issue is they may sell that judgment so anybody who does this has to be aware anything of the judgment love stupid bank may not be chasing them some very enterprising judgment buyer who bought the 50 000 judgment for a thousand dollars may pop up somewhere in there later in their life later saying you know let’s make a deal and they may be very nimble and very aggressive.

But for non-recourse states it’s a much easier decision recourse states it’s a much trickier prospect and that’s why I say walking away from people you don’t walk away free there’s threats there.

Audience Objection to Doug French

39:12

I’m still not persuaded with your remarks and I think you are perfectly right when you are describing from positive perspective how people behave and why can they behave this way not another way but you jumped into ethics very easily and you justified some of these behavior important patterns and I was saying that you know I’m afraid that you’re opening Pandora’s box and like lots of what in the basement during springs or maybe the plumbing system doesn’t work properly and he may say just walk away because it doesn’t it’s not as good as he supposed to be. And I think it’s not a reasonable reason actually to walk away from contract to justify it and if we go further you know of course from a positive point of view if you find a bicycle in the street nobody sees it you may take a bicycle and this would be a decision but it doesn’t mean that we have to justify this this kind of business decision it’s a simply completely different area. And I think that in comparison to taxation or social welfare and social security is not correct actually because in case of banks you sign a contract in case of taxation you need contract is not existing against social security as well and in fact if you look to the practicalities in many cases it’s a person who applies for credit to buy a house it’s not a bank who forces it.

And just for the final remark it’s a favorite example from UK there was a case with a lady who pursued a bank because she told the bank actually by offering extended credits and actually the offer was made exactly on the day when she lost her job and of course the offer was put in a very nice manner like please go and spend all of it and actually she did during next week and then after having no money to pay back credit she sued the bank for because and actually.

Doug French Response

41:54

Well this is what makes for a good Q&A I suppose but no in terms of the taxation you decided that you would pay income tax right yes is it ethical for you not to pay taxes sure and is it ethical and if I mean when you say that while we get taxed and that’s not equivalent to a mortgage because you voluntarily got into a mortgage when you voluntarily sign a mortgage income tax and you got a job and you make income you voluntarily you voluntarily sign on to pay property taxes when you own property you voluntarily sign on to pay sales tax when you buy things okay sit over there in the ivory tower if you want to I’m talking about the real world here and what I’m trying to talk about is the real world versus this libertarian purism. Yeah I just wanted to add that well in principle you are right a contract is a contract but it’s not always that easy to just say that the contract is a contract a few years ago I had an exchange in Phillip we were talking about possible monetary deflation in the current monetary system so let’s suppose that like holes of the banks they collapse and nominally your debt goes like 1000 up if all most of the banks fail so under the circumstances well we need a sort of arrangement for the whole country to reorganize the debt structure right but then from your perspective you could just say oh you took the credit is your risk you’re supposed to just pay but you hold that to me right way to the bank and the current legal system actually benefits the banks hugely.

So it’s like let’s say in 1991 when you had one company providing telephone services okay so let’s say the telephone service the company comes in in 1991 offers you a contract silent or otherwise you’re not gonna have a call okay and you sign a contract saying okay I will be your customer for the next hundred years or until I die and then in 15 years suddenly you have market economy developed you have competition between different companies so you can choose a different company but then you’re not allowed to because you have a sort of contract right it’s like the state would show up with your door and say you want to pay the taxes right no but sign a contract now no I will not okay so you’re not allowed on a public street and die in your home right and then they could defend themselves by saying therefore the state is a voluntary institution contract now didn’t you right and you would have to sign the contract under the circumstances right and admit that you would right wouldn’t you set the contract you would die about 100 but the situation is completely different I know it sounds completely it is different you’re all right it’s different but it’s not completely different it’s the question of continuum right when do you draw the borderline right and that’s after the debate and I think that was what was created it was very important that you look at each specific case so to speak.

Let’s say I go to Bernanke and he gives me a huge number not as a private person but there’s a heck the central bank do I then have the obligation to repay the loan where can I default on the loan and walk away would he be treated in the legal system in the same way as if I received the loan from you personally and yeah I would say of course if I default on Bernanke that is perfectly all right after all he is ahead of a criminal organization I have no moral obligation whatsoever to pay anything back.

Audience Question on Central Bank Balance Sheets and Losses

47:23

Carrying on with central bank balance sheets and this is for Philipp and Mateusz this is not an ethical question it’s just about history or about the future you can take it out of your way so central bank balance sheets something that’s fairly likely to happen in the next few years is that the measured core consumer inflation will eventually start to pick up like our headline inflation measured consumer inflation has already picked up dramatically when this happens the Fed will probably start doing a tightening and that tightening may very well include kind of a reverse QE2 where they take their balance sheet and squeeze it down now if they do this in a undoubtedly higher interest rate environment they’re going to take huge losses on that balance sheet they’re going to be selling treasuries and mortgage backs it may be an environment in which the average interest rate on the treasury curve is six rather than two or three my question to you is well it’s a bunch of questions about does it matter ultimately do you know of historical cases or cases right now where central bank losses potential losses are already constraining so-called independent monetary policy where the central bankers are trying to protect their own institutions because even though they’re really part of the state they also have their own personal agendas and if they lose a ton of money they’ve got to go do they have to go to the Treasury and get a recapitalization or can they just bury it with good old cost accounting or they just but they can’t bury it right because they’re selling bonds if they actually sell the bonds to contract the base they’re going to actually have to record losses so you can approach this from either a historical like has central banks been constrained by their own P&L or in the future will be constrained is China being constrained we have a lot of central banks now with huge balance sheets with tremendous potential losses.

Philipp Bagus Response

50:32

Here you arrive at the fact at least okay of course don’t cannot be used to solve it in the pay steps because it can just reduce dollars to pay its debts but it’s to have a negative capital on the balance sheet would be problematic for the confidence in the currency we would have losses that would make would be obvious that there are not many real assets left to defense accounts in case of problems or for monetary reform for that matter however because when they sell assets losses it becomes obvious that there was nothing or there’s nothing left with monetary reform or to intervene on the one exchange market to defend the currency etc so it might have an important effect on the confidence and people might have started to sell the currency or their dollars and you see it also that it matters for the ECB because easy dollars can also create printed zeros however in December they increase their capital why because they are of course expecting losses from their adventures in club land and they don’t want to have negative capital so and this has cost for them because it reduces their profits and they pay back less profits to governments due to this capital increase so they care they actually care for their balance sheet and of course their cases of central banks or the central bank of Iceland for example it pays but of course for foreign ECB and the Fed is not so much further because they don’t have so many foreign denominated debts.

Mateusz Machaj Response

52:55

I would say that it doesn’t really capital or matter they the central banks could easily do what they’re doing still even if they would have even if they had a negative capital the guess would be well the economist would extra money the government would have to buy money in the financial market they will issue new debt to recapitalize the central bank and then that extra that will be bought again by the central bank or something like that so what they would have to do which is increase public debt but this of course doesn’t matter under the circumstances because the public debt and we just rolled over as fully demonstrated so I don’t think there is any problem with negative capital for smaller foreign but not for ECB or the federal reserve system I didn’t see any problem coming here and apart from that I think also that the balance sheet per se is that important for the strength of the currency I think other factors are more important the investors are not really paying attention to capitalization of the central bank the value of currency depends on the on the quality of the relationship and this is not the result of an economic protective activity so it’s very easy for government to recapitalize the central bank the central bank just buys treasuries and the government does not spend the money but put into this special account called capital reserves in the central bank so this can be a cashless operation the recapitalization of central banks to any given level is purely cashless but your question has a particular relevance for the euro area and written in the following any profits from the monetary operations that very detailed are redistributed but any losses are kept on the specific central bank which provided emergency liquidity assistance now we are having this issue currently because Irish banks are borrowing almost as much as they borrow from the regular operations directly from the central bank with emergency loans and whatever losses could be realized on these emergency loans would go directly from the states that of course this would increase the cost of borrowing of the other state alone and so there is a kind of socialization of profits within the member states of the euro area that there is individual internalization of possible losses and this would in just just one example imagine that the Fed gets negative capital because they do an organ and they find there’s no body so it takes a loss there’s no gold in the Fed okay negative capital or you do the recapitalization which is.

Audience Question on Strategy Against Parasitic States (and Closing Remarks)

57:30

The journalists that will go along with them and create these stupid theories that rob more people more of their property from a competitive position of the lovers of liberty what is the strategy to benefit from this I mean if we are trying to compete against them and create something as an alternative all these values are actually goals in terms of creating something alternative that will attract some of the people that don’t want to be voluntary servants anymore so my I guess my the first part of the question is why doesn’t anything like this happen here the whole world is dominated by this parasite nation states and secondly what can we do about it to make it less likely to continue like this in the future state employees many countries we have already 50 of parasites and then we have democracy and these 50 of parasites they love parasitism I’m personally I’m not very hopeful that liberty is just around the corner I frequently think that for the time that we have left for ourselves we should just almost enjoy this seat of crazy thing going on as long as they do not really personally grab us and kill us and incarcerate us I must say I frequently I read the paper and I find all of these particular things just funny and hopefully nobody will grab me personally and hope for the best but then to be personalistic I have not really seen any major progress in terms of liberties I think people in the 19th century of course have far more personal liberties and they have they have currently maybe somebody has to say something more optimistic but I’m not one of those that has great optimism this is why I think this is also a song to join each person’s company and laugh about the foolishness of the saying in America that you cannot fight city hall city hall will do whatever it wants to you but Gary North says but you can pee on the front steps and run away just to say that there are four that we’ve had I’d like to put just make a few assertions that critical to the question I would observe that the lifetime tax rate in the 19th century was approximately 20 lifetime tax rate defined as what fraction of your life did you have to give up to the state before your your children receive what the fruits of your life in 20th century election tax rate has been about 90 percent I’m talking primarily from an American perspective of other analogies in many other western countries and then the 19th century a lack fair 20 lifetime tax rate we had the gold standard we’ve had monetary stability the 20th century we’ve had Vietnam you know 98 in some countries much more than 98 of our destroyed by the welfare warfare state so the question is would you like to watch the light how much better off we would have been if we had the same conditions from a tax monetary standpoint in the 20th century as we had in the 19th century what is the magnitude of how much better off it would have been we’ve had laissez faire gold standard under accenture in the last century I think this would be a question for an but of course it would be I think that would be a little bit wealthier and you would be a little bit wealthier too as I said you know I’m not the kind of person who does these calculations I’m sure that there are some people who calculate these sorts of things I have never thought about it and I wouldn’t even know how to do the characteristics I have a question for professor is there any study regarding the level of taxes and tax inflation people pay around the world and can we compare that to the level of taxes that the slaves and servants used to pay and something else I have a comment on the ethics of walking away from the contract I’m typically professional kids around that and the classroom libertarian legal theory and he has a case that breaking a contract is not a violation of the libertarian code probably that’s a misconception that he’s going is any study regarding the level of taxes and tax inflation people pay around the world like I can only answer the question is it is a taxation nowadays higher than what the taxation was it was because of private slaves I would say yes it is higher than what was involved in imposed on private slaves again I’m sure there is empirical studies about not an expert on this I only really remember having wet comparisons of current tax rates and the degree of exploitation that the slaves were subject to the amount of taxes that was being extracted from the slave was low as compared to what is expected from I remember reading something by Paul Craig Roberts he said medieval serfs paid something like 40 percent and in the US anyway if you if you were to get statistics on tax revenues and from all levels of government and divide by national income you’d get over 40 but that doesn’t count the inflation tax or how regulation causes the price of business services to go up and all the other effects of them without that if you include the retirement funds that you have to pay before you tax your income because apparently these are not taxes according to modern status I think this question might be done now Doug I thought you answered the question which was there’s a difference between loaning and speculating and so I don’t think it’s an ethical question it’s only an ethical question there’s asymmetry in the speculation so if I think I’m giving you a loan and you think you’re speculating that’s a problem but if we both know that we’re speculating which I think you were trying to make the case for it’s not a medical question it’s just what we’ll speculate on over the last two years the development particularly in the northern states in Malaysia where the gold dinar and the silver money that they durham there and the recent decision in Utah to allow gold to circulate as money in defiance of the U.S laws I also know that the commodity the CME the commodity exchange in Chicago as well as JP Morgan in the course of the last couple of years have allowed gold to be used in the same way as cash because treasures are for collateral for marginal purposes these are indications to mean of an erosion of the legal tender laws and a great practice point for us to know my question for the panel is actually for the panel in general I’m very interested in looking for other signs of relaxation of legal tender laws not enforcement of the legal tender laws either from the historical perspective or from your various studies that you have seen or that you might want to see so we shouldn’t acknowledge them because then we would have anything to do itself I mean I don’t know of historical examples where legal tender was removed who accept commodity meaning probably we are not there yet but what we are still seeing is that some foreign central banks are increasingly buying gold and more and more skeptical about western American public debt instruments as investment opportunities but I think that the United States right now are not really essential or really important I think they are very important the moment you go off for example gold standard is so big and for Texas indeed so it might be important the opposition of torpedoes and those might actually be important if you also introduce competition in the banking industry right then it would have a tremendous effect actually if the banks would sponsor even in the alternate credit cards if you just leave the central banking system with currently existing fiat monies and licensing of the banks for this particular currency even if you need this because if you introduce competition completely free competition nobody will trust the tax anymore they will collapse but even if you left that system at alone and then abolish the legal tender laws and introduce a form of competition in other currencies and freedom of banking services in other currencies I would think it would make a huge difference it could make a huge difference okay with that I thank you all and again keep in mind so please you.

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Property and Freedom Podcast, Episode 074.

This lecture is from the 2011 meeting of the Property and Freedom Society: Nikolay Gertchev (France), Psychology Ain’t Economics: New Fads in Economics. PFS 2011 Playlist.

Podcast: Play in new window | Download (27.8MB)

Property and Freedom Podcast, Episode 073.

This lecture is from the 2011 meeting of the Property and Freedom Society: Thomas DiLorenzo (USA), The Fallacies of “Happiness Research”. PFS 2011 Playlist.

Podcast: Play in new window | Download (25.0MB)

Property and Freedom Podcast, Episode 072.

This lecture is from the 2011 meeting of the Property and Freedom Society: Doug French (USA), Going Broke: The Ethics of Default. PFS 2011 Playlist.

Podcast: Play in new window | Download (26.1MB)

Property and Freedom Podcast, Episode 071.

This lecture is from the 2011 meeting of the Property and Freedom Society: Philipp Bagus (Spain), The FED and the ECB: Banksterism Compared. PFS 2011 Playlist.

Podcast: Play in new window | Download (42.7MB)

Property and Freedom Podcast, Episode 070.

This lecture is from the 2011 meeting of the Property and Freedom Society: Mateusz Machaj (Poland), How and How Not to Criticize the Central Bank. PFS 2011 Playlist.

Podcast: Play in new window | Download (30.1MB)

Property and Freedom Podcast, Episode 069.

This lecture is from the 2011 meeting of the Property and Freedom Society: Hans-Hermann Hoppe (Germany/Turkey), Politics, Money and Banking. Everything You Need to Know in 30 Minutes. PFS 2011 Playlist.

Further reading: Banking, Nation States and International Politics: A Sociological Reconstruction of the Present Economic Order (Vol. 4 Num. 1) (also in EEPP)

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Property and Freedom Podcast, Episode 068.

This lecture is from the 2011 meeting of the Property and Freedom Society: Hans-Hermann Hoppe (Germany/Turkey), Welcome and Introductions. PFS 2011 Playlist.

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Property and Freedom Podcast, Episode 067.

These short remarks are from the 2010 meeting of the Property and Freedom Society: “Closing Remarks,” by Hans-Hermann Hoppe. PFS 2010 Playlist.

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Property and Freedom Podcast, Episode 066.

This panel discussion is from the 2010 meeting of the Property and Freedom Society: “Discussion, Q&A,” by Hans-Hermann Hoppe (Germany/Turkey), Stephan Kinsella (USA), Terrence Kealey (UK), Frank Van Dun (Belgium), Anthony Daniels (Theodore Dalrymple) (England), Thomas DiLorenzo (USA). PFS 2010 Playlist.

Re Hoppe’s comments, see Laugh at the State, Mock the Regime.

Property and Freedom Podcast, Episode 065.

This lecture is from the 2010 meeting of the Property and Freedom Society: “Science is a Private Good—Or: Why Government Science is Wasteful,” by Terrence Kealey (UK). PFS 2010 Playlist.

Kealey fields questions on the panel in PFP066.

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Property and Freedom Podcast, Episode 064.

This lecture is from the 2010 meeting of the Property and Freedom Society: “Ideas are Free: The Case Against Intellectual Property Rights,” by Stephan Kinsella (USA). PFS 2010 Playlist.

See also KOL 054 | “Ideas are Free: The Case Against Intellectual Property: or, How Libertarians Went Wrong”

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Property and Freedom Podcast, Episode 063.

This lecture is from the 2010 meeting of the Property and Freedom Society: “”Public Health” as a Lever for Tyranny,” by Anthony Daniels (Theodore Dalrymple) (England). PFS 2010 Playlist.

Podcast: Play in new window | Download (25.4MB)

Property and Freedom Podcast, Episode 062.

This lecture is from the 2010 meeting of the Property and Freedom Society: “America’s Culture of Violence: Myth vs. Reality,” by Thomas DiLorenzo (USA). PFS 2010 Playlist.

Podcast: Play in new window | Download (51.1MB)

Property and Freedom Podcast, Episode 061.

This lecture is from the 2010 meeting of the Property and Freedom Society: “Property and Punishment: Restitution and Retribution,” by Frank Van Dun (Belgium). PFS 2010 Playlist.

Podcast: Play in new window | Download (53.7MB)

Property and Freedom Podcast, Episode 060.

This lecture is from the 2010 meeting of the Property and Freedom Society: “On Private Goods, Public Goods, and the Need for Privatization,” by Hans-Hermann Hoppe (Germany/Turkey). PFS 2010 Playlist.

Youtube:

Podcast: Play in new window | Download (41.3MB)

Property and Freedom Podcast, Episode 059.

This panel discussion is from the 2010 meeting of the Property and Freedom Society: “Discussion, Q&A,” by Olivier Richard (Switzerland), Jörg Guido Hülsmann (Germany/France), Nikolay Gertchev (France), Norman Stone† (UK/Turkey), Hunt Tooley (USA), Sean Gabb (England), Mustafa Akyol (Turkey). PFS 2010 Playlist.

Youtube:

Podcast: Play in new window | Download (54.2MB)

Property and Freedom Podcast, Episode 058.

This lecture is from the 2010 meeting of the Property and Freedom Society: “Are Islam and Capitalism Compatible?,” by Mustafa Akyol (Turkey). PFS 2010 Playlist.

Youtube:

Podcast: Play in new window | Download (26.4MB)

Property and Freedom Podcast, Episode 057.

This lecture is from the 2010 meeting of the Property and Freedom Society: “Chamberlain, Churchill and World War II: Reflections on Factual and Counterfactual History,” by Sean Gabb (England). PFS 2010 Playlist.

Youtube:

Podcast: Play in new window | Download (29.3MB)

Property and Freedom Podcast, Episode 056.

This lecture is from the 2010 meeting of the Property and Freedom Society: “World War II: Western Imperialism and the New Middle East,” by Hunt Tooley (USA). PFS 2010 Playlist.

Youtube:

Podcast: Play in new window | Download (23.8MB)

Property and Freedom Podcast, Episode 055.

By Norman Stone^†. This lecture is from the 2010 meeting of the Property and Freedom Society: “World War I—the Eastern Front: Britain, the Ottoman Empire, and the Making of Turkey and the Modern Middle East,” by Norman Stone† (UK/Turkey). PFS 2010 Playlist. Transcript and shownotes below.

See also

• Norman Stone on Turkey: World War I, Ottoman Legacy, and Lessons from Spain
• PFP090 | Norman Stone, Comparative History: Turkey and Spain (PFS 2012)

Youtube:

Shownotes/Summary (Grok)

Lecture Introduction and Personal Challenges 0:22

Historian Norman Stone discusses difficulties with technology during the presentation. He notes he is a Scotsman not skilled in engineering or PowerPoint, referencing a scene from The Third Man. He proceeds with his voice-only lecture on a broad historical topic.

Historian’s View on Economics and Lecture Scope 1:02

Stone explains that much of later twentieth-century economics stems from the anomalous conditions of the first half of the 20th century, particularly the Great Depression as a product of the First World War. He prefers returning to 1890 standards. He acknowledges the challenge of covering the vast subject of the Middle East and the Ottoman Empire from Morocco to the Volga, indicating only main lines.

Conflict Origins from 1911 Onward 2:06

The First World War is traced back to 1911 rather than 1914, beginning with the second Moroccan dispute involving a German gunboat at Agadir. This led to Italian invasion of Libya and occupation of the Dodecanese Islands. The Turks suffered in that war due to lack of navy, prompting Balkan states to attack the Ottoman Empire.

Geopolitical Rivalries Involving Germany, Britain, and Russia 3:45

Germans and Austrians viewed Ottoman Turkey strategically, similar to British positions in Egypt. Rivalries over the Middle East involved oil and brought Russia and Germany into conflict. The war in the West ended in 1918, but continued with the Turkish nationalist war of independence until 1923. Stone references the post-war effort to return to “normalcy” under President Harding.

Western Attempts to Control the Middle East 4:43

Stone examines Western, German, Russian, British, French, and Italian efforts to take over the Middle East, including creation of mandates and the Jewish National Home. He cites Lord Curzon’s overconfident vision of a new Roman Empire. Failures became evident by 1930 in Iraq, as observed by Lawrence of Arabia, contrasting Turkish methods of control with smaller local forces.

Overconfidence Among Educated Leaders 6:12

Stone questions why well-educated leaders of 1914 exhibited such overconfidence leading the West into complex Middle East situations. He draws parallels to later American actions in Iraq, noting his own initial support despite Turkish friends’ warnings. The lecture addresses overconfidence in dealing with the region.

Gallipoli Campaign and Dissenting Voices 7:43

In 1915, Winston Churchill pushed for battleships through the Dardanelles expecting Turkish collapse. Only two British figures opposed it: Aubrey Herbert, a linguist who warned pushing Turks would make them fight back, and Dauntesey Wylie, a former military consul in Adana sympathetic to Turks from the Armenian context, who served in the Red Crescent and refused to carry a gun, later killed at Gallipoli.

Clarifying Orientalism and Scholarly Context 10:01

Stone defends the term Orientalist against Edward Said’s usage, recommending Michael Robert Irwin’s critique. True Orientalists love their difficult subjects like Arabic or Ottoman Turkish. He protests the misuse, noting German scholarship’s prominence, and discusses self-reflection on Western civilization.

What Made the Ottoman Empire Function 11:57

Stone explores why the Ottoman Middle East “ticked” under Turkish rule, as noted by Lawrence, unlike under the West. He discusses historical theories linking Turks to Byzantine models and the flexible, open Islam of the 15th-16th centuries under Mehmed the Conqueror and Suleiman, contrasting with later decline narratives.

Debates on Ottoman Decline and Religious Parallels 14:20

Decline is attributed sometimes to Islam, with examples like opposition to telescopes and astronomy by ulama. Stone compares this to counter-reformation Catholicism in Spain, citing a late 18th-century university question on the language of angels.

Kemalist Revolution and Rejection of Ottoman Past 16:37

The Turkish Republic under Atatürk rejected Ottoman history as rubbish, reforming language, emancipating women, and following foreign models while limiting encouragement of Islam. Stone notes limits to persecution and the revolution’s role in survival, though he critiques excessive hero worship and statues.

Successes, Challenges, and Modern Dynamics of Turkey 20:14

Despite issues, the Turkish Republic is a success story with dynamic economy, black market activity, and handling of refugees. Erosion of secular standards led to rise of political Islam. Stone discusses Kurdish problems, relations with Europe, expansion into Russia and Central Asia, and risks of overreach, including reactions to Israeli actions.

Personal Reflections and Closing Thoughts 23:58

Stone shares his 1995 move to Turkey and positive experiences. He reflects on the Ottoman Empire’s complexity and uncertainties for the region’s future regarding Islam, education, and women’s roles, concluding his lecture.

Transcript (Grok)

Introduction and Audio Setup Issues 0:22

First, first question is, can you hear me? Alright, is that any better? No, I’m sorry, I simply cannot handle technology and I’m a Scotsman. We are famous for our engineering, not me. If I were to try a PowerPoint presentation I’m afraid it would be a farce like you remember the lecture in The Third Man who ends up running away and being bitten by a parrot. No good. So if you can bear with my voice, here we go.

Historian’s Perspective on Economics and the Lecture Scope 1:02

I might start off by saying that you know I am a historian and it’s been very interesting listening to people talking this morning about economics. It always strikes me that you know the sort of economics you get in the later twentieth century it’s really based on the first half of the 20th century, the Great Depression really. It’s utterly anomalous, a product of the First World War and so on. So the sooner we get back to 1890 the better.

Now I’ve got, I suppose it is the end, it is the hard luck story of all lectures but I have a huge subject to cover and I’ll do my best with it. The Middle East, the Ottoman Empire with all the complications that followed there from. The Ottoman Empire from Morocco to the Volga at one stage. I don’t want to talk about this, I can only indicate one or two main lines.

Origins of Conflict: From 1911 to World War I 2:06

Now let me just sum up the period that I think we should maybe concentrate on. The First World War didn’t really break out in 1914, it broke out in 1911. I don’t know, those of you maybe remember the origins of the First World War will maybe remember the second Moroccan dispute when the Germans sent a gunboat to Agadir and a Franco-German war resulted. Now that resulted in the British taking the side of the French and in the gap the Italians thought a good time for us to get our bit in the sun. So they invaded Libya which was then a lot of sand and then went on to occupy the Dodecanese Islands, future just down the road. And that was Italy firing the starting gun.

Now the Turks didn’t have a good time with that war. They didn’t have the navy and of course it excited the Balkan states to start attacking the Ottoman Empire so they took a lot of importance on except for the area in Anatolia. Then the First World War comes up and as if I mentioned too that which is relevant the Germans and the Austrians said the Ottoman Turkey is going to be our Egypt position the British have in Egypt or a slight offensive in Syria. The Germans would get in Anatolia a determined presence. The Austrian presence is all around.

Geopolitical Rivalries and the Broader War Context 3:45

Ikura really became capable because the Germans put a railway station in it and it comes that dimension of rivalry over the Middle East already involving oil. Brought Russia and Germany for the first time did a great clash and that’s the background. Now the war in the West formally ended in November 1918 but then it went on and it went on with the Turkish nationalist war of independence which was really only ended in the summer of nineteen twenty-three. So when we talk of the First World War we’re really talking 1911 to 1923 after which the world makes its failed effort to get back to what an American president called normalcy. Wonderful word, President Harding.

Western Overconfidence in the Middle East 4:43

Now what do we make of this, of the attempt by the West to take over the Middle East. The Germans in Manatee, the Russians had a go, the British and French, the Italians step in, create mandates, create if you like the Jewish National Home. And people like Lord Curzon, a foreign secretary who had been Viceroy of India when he was asked what do you think about the British Empire your lordship replied which will be in India assist forever thinking it’s going to be a new Roman Empire.

Now these people do the very foolish indeed not just by 1947 when they had to scuttle out of India but even by 1930 it was obvious enough that Iraq hadn’t worked and Lawrence of Arabia observed at all and he said why is it that we with an army of a hundred thousand men with poison gas, the Daleks, can’t keep the peace in Iraq where the Turks did it with a locally raised army 13,000 men executing ninety five people a year? Question mark. It’s a good question, be it said then as now.

Questioning Overconfidence and Historical Parallels 6:12

Now looking back on it the thing that I really don’t understand is this: why is it that these people of 1914 got it so badly wrong because my George they’re very well educated, they’re very clever, they wrote extremely well, a lot of them. Could they be so wrong? What are tons of this amazing overconfidence with which they lead the West into this potential in the Middle East?

I suppose although you know they weren’t hard to much on it I suppose the same thing would have to be said about the Americans later on going into Iraq. I have to say that maybe I was mistaken but I supported that although my Turkish friends said you’re quite wrong this is not a good idea. But at any rate one striking thing is the confidence with which they go in and then suddenly run into a position into a situation which is to say the least complicated. As I say I’m not going to condemn because I’d have to condemn my own judgment. So we’re dealing with the question first of all of overconfidence and dealing with a Middle East.

Gallipoli and Dissenting Voices 7:43

No I might as well tell you a little anecdote about this. In 1915 when the Turks they appeared to be very weak Winston Churchill said the moment has come to send battleships through the Dardanelles and the Turks will just collapse. After all they collapsed in the Balkan wars they won’t fight back. And they landed their army at Gallipoli and only two people in the whole of the British Army said this is a mistake. One was an interesting man, Aubrey Herbert who was the son of the Earl of Carnarvon who had was one of these weird linguists. He picked up personal Turkish, got those what and he said don’t do this. He was the interpreter. He said if you push the Turks against the wall they’ll fight back.

And the other man was another interesting chap a regiment in command and Dauntesey Wylie who had been had become what was called a military consul in Adana. You know as the as the Ottoman were written the Armenian question to be frank as it got internationalized international observers were placed there to see what was happening that they were called military consuls and Delta Wylie is one, a colonel in the decent regiment and he lived in Adana and saw what was going on. He could see the problems of the whole Armenian thing and he ended up sympathizing with the Turks and when the Balkan Wars broke out he resigned his commission and served in the Turkish equivalent of the Red Cross it’s called the Red Crescent and they gave him a big medal for it. Now he joined the army did his military stuff until Emily but when he was invited to go and land at the Dardanelles he said I’m not carrying a gun and not gonna kill any Turks so he carried a swagger stick only and I’m sorry to say he got killed. Dauntesey Wylie. They were the only two people in the British Army who said this is a mistake.

Orientalism and Scholarly Love of the Subject 10:01

No let me just introduce another little point which I think I to myself to mention. You’ll be aware of the name Edward Said. Now before you read Orientalism have a look at a devastating book by Michael Robert Irwin which is about the Said question. The word Orientalist has now become an insult it means that people look at the Orient the Near East with Western eyes and as it were adopting insulting patronizing attitude to it. Now that is an utter and total misuse of the word Orientalist. The Orientalists are people who almost by definition love the subject. You cannot take on something that’s difficult as Arabic or Ottoman Turkish or I think multi-person without having almost a love of the subject you’d have to have it and they don’t spend their lives looking at the places like this if they automatically dislike it or want to patronize it. It’s quite wrong.

And the Said book is full of holes. Part with eels he neglected the whole of German scholarship. German scholarship on this subject is bigger than anywhere else. So I want to make my original protest against this misuse of the word Orientalist. Now there are Orientalists and the Orientalists in this citation spar here there are people who look at their own civilization and say why are we not the West. These are the Orientalists not us. And this introduces quite an interesting subject about the background to the First World War and the aftermath.

What Made the Ottoman Empire Function 11:57

What made Turkey tick because we can no mass of that question. The Middle East when it was Ottoman somehow ticked as Lawrence noticed. It didn’t tick with the West at all. Now what made the Ottoman tick and it’s a good enough question to begin with. In the days when Carson was expressing himself with their contempt on the south wall glorification and the subject of the West he would say people would say the Turks revealed everything to present him. There is a theory of Turkish history associative method gives America when he was stopped with in 1916 which said that the Turks are the sort of people who can create an empire to stand for a couple of generations then it collapses. If they want to if they make a real Empire they had to take new models of Byzantium so they were sort of presenting with a Tajik if you like and this can really be waved a sound that we can forget about that. There are interesting similarities between the Turks and a slice of delete by sometimes half the Byzantine aristocracy simply defected to the Turks because they had a state that worked.

As soon as that but you can’t really argue that it’s present him in disguise. What you can maybe argue about talking is that the Islam of the creative days by which I mean the 15th century when Constantinople was taken it’s an Islam which is much more open. A wine is dropped at the court for instance. They want the Orthodox Church became the biggest landowner in whole of the Empire. Mehmed the Conqueror was after all himself correspondent Christian by origin and you could argue I’m not going to be dogmatic but the Islam which created the Ottomans in the early days up to Suleiman in the sixteenth century it’s maybe much more flexible more open. It’s at least arguable.

Decline Debates and Comparisons 14:20

And now the it’s possible to argue and here you know in your stamping on cause why did the Ottoman Empire decline and again there is as it were an Orientalist attitude which is associated with the Republic of the 1930s and 1940s when people would say the Ottoman Empire declined because of Islam. And you take this sort of story in 1570 1583 I think we’re out the third I’m not sure but around then there was an Ottoman astronomy you need to do for navigation that they have a very good Navy and they had telescopes in the top of the tower that message and the clerics didn’t like this the ulama didn’t like this part of cousins astrology and they said look you’re trying to probe the secrets of God you mustn’t do this. And then there was an earthquake but the ulema said that’s God’s punishment for your tribe looking at his secrets so they took the telescopes down off of the tower end of Ottoman astronomy.

Well you might say right Islamic and to progress but then you might widen it to take in what generally happened in the Mediterranean time if you take for instance the world of come to revenue counter-reformation Spain it’s not entirely the cinema I came across a wonderful one since 1776 Adam Smith publishes America does it stop there was one faculty left the University of Salamanca all the dogs were busy doing something else so they there was only one question to be answered in Latin and he grade what language did the angel speak and that is no that is the world of counter-reformation Catholicism in the later 18th century it’s rather similar to what could be said to be going on with Islam in that period.

Kemalist Revolution and Its Impacts 16:37

Now however you want to argue the there is one stand which is worth picking on now I think when we looked in that doesn’t name devilish politics you know for a long time in Turkey you were supposed to say that they laid out of an empire just so much historical rubbish you know the great lineman and one of the bits of truth which I remember which is but these people look on history as a chicken looks at the base of a Michel from which it is evolutionary twenties and you might have said let’s just get rid of all of this Ottoman junk all these creepy corrupt sometimes all these dead parents with their silly quest they’re unreadable script let’s emancipate the women let’s follow the best foreign examples to come. Judy came from America to apply some on education this kind of thing.

David Nanette devourer arrived to tell me one about the Dahle German architects all over the place so they ruined period but they do not want to know about their history and although Islam wasn’t exactly suppressed it wasn’t getting any sort of encouragement you know it is sometimes issue if human if you don’t give religion what he wants it seems to be persecuted when it talks the language of the persecuted in the slightest the persecutor in effect so you have to be careful about that and there were limits to the persecution of Islam they had at the time but they do not want to know about the Ottoman past and they had thrown out almost all members of the Ottoman dynasty who were languishing abroad a lot of them. They reformed the language in a way which some people would sue Mr. Thatcher would say that the language before was brutal and unnecessary but it still defines the Turks they’ve got a literate population which should go into a bookshop you will see quite a flourishing publishing industry and it wouldn’t include anywhere to the east and south but this would be the case.

At any rate my point is that they utter total revolution is something which abolished Esther no and it’s not his name which accounts for the survival holding statutes around the place. I’m not terribly hostile to it because I can see why an educated girl would say assuming of London if that man hadn’t lived I wouldn’t have been where I have known with an independent income and a job of my own it’s a cold they obviously exaggerate there are too many statues of that sort I don’t know what they could do some of the quotations are in funny with I don’t know how many of you here are Turkish but the best one I ever discovered was in a garage and the way to Cappadocia where great minds like Jews there and it read to show through any muscle in the sun meaning the Turkish driver is a person of the most exquisite sensitivity.

Obviously we have to get away from this kind of hero worship.

Turkish Republic Successes and Challenges 20:14

Now what has been interesting about it is the way in which the Turkish Republic despite everything despite its ability to despite this that the other it’s been a success story and the little examples all over the place. Russians died at 62 sire 70 I don’t believe the statistics of I don’t believe any statistical data at all largely because they thought you know they’ve got better things to do at the time their statistics and I often think that the Italians stings in the state and our dynamic the day and then he from the people in this statement no this is a place with a huge black economy it’s going somewhere.

Little example there are something like two million refugees here and that is normally with any other doctor in Athens and Singapore I won’t go on about that the point is too obvious I think to anybody seen it problems all over the place. No one strange consequence has been that the auditory public has been eroded its secular standards which resulted in many many very good things. Nathan hospitals not bad schools all that’s worthy and the setting of standards have ceased somehow to be living and so you have the phenomenon coming up of political Islam here. And I don’t want to talk too much about what goes on internally what what I’m interested in is what the consequences are going to be for the whole area because Turkey has the dynamic bit of it to decide the one where you know mix things it gets prizes for it says six teams and that Turkey is going to be sucked into a sort of mode that it had in the 17th 18th century when it’s got its tensions got its family relations.

I’m afraid to say you know we have a Kurdish problem here it’s not an easy one there are seven different Kurdish languages setting up the Kurdistan not a simple matter maybe the answer to it is going to have to be but the Turks take over northern Iran that’s happened in the days of selling the guerrilla it means problems for the Turks their relationship with Europe has become become complicated is tell a woman earth to be done about that on the economic side it’s very valuable from the other side the Turks are expanding into Russia they exposed to even to Central Asia but going up with something like 50 percent per annum in other words turkeys in a very dangerous position in the moment when it might get the idea that it has the right to being the thing power and week I had this sort of things dangerous.

Contemporary Reflections and Closing 23:58

And I found I have to say that business with Israel the other day just it immensely diss me. I don’t know what the answer to the Gaza Strip would be but I think to use it as the way of building up 30 Israeli settlement which is quite easy to do here would have to say not that too Jewish but anti Israeli is quite easy to stir it up allowing that to happen but then for the Israelis all the things of rated battery of course compounds the whole problem.

So it looks to me as if we’re when I came to Turkey in 1995 people said you know what a strange exactly thing to do I mean I came here for many reasons they very thirsty which was when I arrived at the airport assault six policemen straight out at midnight express but we unbelievably great big black mustaches smoking heavily and resign but strictly no smoking alcohol my sort of country. Leather and the decision to come here in 1925 no lose great detail message senator I didn’t know what I was letting myself in for but it’s been an explorer apparel industry of time. Now where we go from here is I think good a bit complicated unafraid of the Ottoman Empire got torn apart looking at the end of the next having to deal with Moroccan one minute and of Voltaire the next worried again what sort of Islamic it has what its attitudes would be to education of women all this kind of thing until at the end they say or please waste somebody thought the Union which is quite the wrong thing because this country is not stated its own now I think I’ve probably enough.

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Property and Freedom Podcast, Episode 054.

This lecture is from the 2010 meeting of the Property and Freedom Society: “Not New, Not True, Irrelevant or Evil: How Economic Nobel Prizes Are Won,” by Nikolay Gertchev (France). PFS 2010 Playlist.

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Property and Freedom Podcast, Episode 053.

This lecture is from the 2010 meeting of the Property and Freedom Society: “The Mirage of Cheap Credit,” by Jörg Guido Hülsmann (Germany/France). PFS 2010 Playlist.

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Property and Freedom Podcast, Episode 052.

This lecture is from the 2010 meeting of the Property and Freedom Society: “The Cantillon Effect: How to Enrich Yourself at Others’ Expense Without Anyone Noticing It,” by Olivier Richard (Switzerland). PFS 2010 Playlist.

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Property and Freedom Podcast, Episode 051.

This panel discussion is from the 2010 meeting of the Property and Freedom Society: “Discussion, Q&A,” by Hans-Hermann Hoppe (Germany/Turkey), Richard Spencer (USA), Marco Bassani (Italy), Paul Gottfried (USA) and Richard Lynn (England). PFS 2010 Playlist.

Note the caveats re Spencer and the Alt-Right in PFP047 | Richard Spencer, The “Alternative Right” in America (PFS 2010).

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