History of Economic Thought – 3 of 6 – The Pre Austrians – Murray N Rothbard

Murray Rothbard died before he could write the third volume of his famous History of Economic Thought, which would cover the birth and development of the Austrian School, through the Keynesian Revolution and Chicago School. With this six-lecture course, however, the History of Economic Thought is complete.

3. The Pre Austrians

Richard Cantillon was quite Misesian before Mises. He wrote of utility theory and the entrepreneur’s uncertainty in the 1970s. Cantillon was a great money practitioner. He became a bank and banker to the Jacobite Stuart line and to John Law who launched paper money inflation.

Turgot became finance minister in 1774, but laissez-faire ideas failed. Turgot was Rothbard’s favorite character in the history of thought. He wrote well under time pressure. He wrote of wealth and capital theory and even of Austrian time preference theory and the law of diminishing returns.

Cantillon and Turgot preceded Adam Smith, but were not mentioned by Smith. Smith made waste and rubbish of 2,000 years of economic thought. The French theorists were lost. Smith deviated from laissez-faire in practically everything. Malthus got his anti-population stuff from Smith.

Hume was a great writer while a confused pre-Friedmanite thinker. He thought fractional reserve banking was fraud.

John Stuart Mill originated much of the Ricardian system like the law of comparative advantage. Mill was one of the inventors of libertarian class analysis which proclaims that the only class conflict comes from the state. Mill and Marshall reestablish Ricardianism. That really ushers in the 20th century.

The third in a series of six lectures on the History of Economic Thought.

This lecture as a Podcast: http://enemyofthestate.podomatic.com/

Sourced from: https://mises.org/library/history-economic-thought-marx-hayek

Source: History of Economic Thought – 3 of 6 – The Pre Austrians – Murray N Rothbard – YouTube

http://www.readrothbard.com/history-of-economic-thought-3-of-6-the-pre-austrians-murray-n-rothbard

TRANSCRIPT

00:00
I guess modern economics or the
00:01
scientific doctrine begins with
00:03
Cantillon Richard Cantillon who was a
00:08
very interesting character to Andrea
00:10
Catalan who’s hardly talked about but to
00:14
put in a plug for myself the gel or the
00:15
parent study of the current issue now
00:17
out as an old Catalan issue by the best
00:20
of the most government written I can
00:21
launder it came out of a conference on
00:24
Catalan met several years ago Ken law
00:28
has essentially with praxeological
00:29
methodology he’s got the methodology of
00:32
abstract reasoning he’s got he starts
00:35
off with a role of one landlord no there
00:38
was land with one Rama owns the whole
00:39
country not so far off because the
00:41
French situation while you have
00:42
landlords and had farmers so that my
00:45
Lords absentee landlords have gotten the
00:46
plan for conquest and they would lease
00:49
the land of farmers and then you had
00:51
other people so you start with one land
00:53
what happens with him they bring in more
00:54
people so like who so economics sir it’s
00:58
a excellent methodological presentation
01:02
this theory you truly evaluate
01:03
essentially utility theory he’s also the
01:06
first person will solve an entrepreneur
01:08
intrapreneurs uncertainty bearing
01:10
uncertainty brings an entrepreneur and
01:12
economic thought theory of money is
01:14
magnificent he has a whole huge theory
01:16
except as a process analysis I can he’s
01:18
a evil word and it was not equilibrium
01:22
other words Lee Calibri was a process
01:24
poet equilibrium so you have in British
01:27
classical economics question of
01:28
different equilibrium state to this
01:29
state of that state you leap somehow to
01:31
magically from one to the other
01:32
it’s hope only about equilibrium state
01:34
where can lon you talk about the process
01:36
total equilibrium for example some
01:39
Catalan talks about what happens in the
01:41
money supply increases in a country he
01:44
tells about how it’s very means Sen sort
01:46
of speak prima just in its first people
01:48
get it they get the new money they spend
01:50
more prices go up as they spend it and
01:53
there.good would they by then it’s
01:55
quicker like other people you have sort
01:56
of rippling out effect in each group
01:58
gets until finally you have a say if you
02:01
double the money supply finally you wind
02:03
up with prices more or less double but
02:05
not completely because you have a
02:06
different equilibrium there you have
02:07
different life effects etcetera and it’s
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a very sophisticated excellent analysis
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of internationally
02:12
for human species flow analysis of camel
02:14
is much better than you even was running
02:16
about the same time a little bit later
02:17
actually now this is say 1730’s and you
02:20
wrote on something touch these human
02:22
might probably heretic and all these
02:23
guys know each other
02:25
the British knew the French stuff candle
02:28
I have a pre Austrian analysis a
02:30
question that of the processed thing
02:31
with individuals starting with a micro
02:33
individuals they get new money they
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spend it and see why not for the knee
02:37
for the sale ember your prices are not
02:39
automatic gobbling you have differences
02:41
it’s a difference in price relative
02:43
prices alright the other hand Hume was
02:46
Scotsman part of the British tradition
02:49
was a brilliant writer I’m have to
02:51
concede with Hume is one of the few
02:52
people in history of thought the great
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writer or or confused thinker usually a
02:56
confusion in good writing I mean good
02:58
writing in Klaudia for coming some come
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together confusion and bad writing come
03:02
together in case of you is writing with
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better than those theories sort of speak
03:06
anyway we’re hearing you have a pure pre
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Freedman like pre moderate analysis and
03:12
were thoroughly Librium states but might
03:14
as a matter fact of the famous example
03:15
which means uses there’s a good a good
03:17
first approximation what happen of money
03:19
but I call the angel Gabriel model in
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other words you’re sleeping overnight
03:23
overnight the angel Gabriel the sentence
03:24
a man they hear the mankind’s always
03:26
fell away again we have got enough money
03:28
the angel Gabriel the number one but
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confuse that allows the economists so
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they can fix these guys up or double
03:34
their money supply then they’ll don’t
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shut up them satisfy their complaints so
03:38
overnight everybody’s nice like a fumble
03:40
magically your bank account your wallet
03:42
your person sucker I gets doubled and
03:44
human talks are bad that he doesn’t say
03:45
that he’ll be the word angel Gabriel
03:46
model that’s basically what it is and
03:49
then what letters what happened run
03:50
everybody watches out spends it then
03:52
according human prices overall bubble
03:54
and that’s it in other words really
03:56
quickly from the one equilibrium state
03:58
to the other equipments they were not
04:00
talking about the process for Cantillon
04:01
it’s very different you have a different
04:03
people benefit on different people lose
04:06
out I mean in this model for example the
04:09
guys who know what’s going on watch out
04:10
of six in the morning or eat in the
04:11
morning spend everything immediately the
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other guys inside the save it of course
04:15
we’re shafted because they they find the
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prices of number before they got around
04:18
to spending it so there are differences
04:20
in it sort of benefit their burdens
04:25
so we’re hearing pretty good analysis is
04:29
the first approximation of how the money
04:31
supply increases prices but you’re
04:32
running blonde out the essential pre
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Austrian process and differences in
04:37
micro level just talk about the macro
04:39
this is the Union by way of the
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disastrous split between micro and macro
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which begins the UN will record out with
04:45
the final final final classic example
04:49
horrendous weather caught on at 15 is
04:51
ever since in the pre Austrian analysis
04:54
Catalan torval all these people are no
04:56
split between micro and macro everything
04:58
is an individual process which has
05:00
different social results it’s only with
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I say the British you have as micro
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River vo they have things going on micro
05:06
world supplying a man that’s certainly
05:07
the micro world you have quantity and
05:09
velocity and will have totally
05:10
difference of them no relationship
05:12
feeling two of them and candle I should
05:14
say something about candle on the man
05:16
Richard Cantillon is a fascinating
05:18
figure one of the reasons why he’s so
05:21
good about money he was a great monetary
05:23
practitioner he was an Irish Catholic
05:24
banker who moved to the Jacobite court
05:27
in France where the Seward pretender
05:29
located he was became of bankers cousins
05:32
rose very confusing with cousins Rowling
05:33
richer an example of the neighbors about
05:35
eat butchered catalogs and easy to get
05:37
confused one great Catalan expert
05:38
Antoine Murphy University of Dublin was
05:40
need a expert on the Catalan family work
05:43
the whole thing out geological map
05:45
anyway Catalan guess he becomes the
05:47
banker to steward the Canada and it has
05:50
a big shot back in general and John lil
05:52
who starts off in this period it’s a
05:53
famous depending money inflation forty
05:55
paper money inflation of history I’ve
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see there was no paper money before the
06:00
first paper government take the money
06:01
ever was 1690 in Massachusetts before
06:03
that go with money the only way the
06:05
government could do anything with
06:06
clipper coins he based the coin well
06:08
paper money comes in the great new
06:10
invention for the government means you
06:12
could just print money
06:12
adlib essentially Jarl or the Scottish
06:15
adventurer just get the whole of royal
06:18
government Paris and convinced that he
06:20
should be the central banker and put
06:22
money and to unlimited inflation you
06:24
have your might divert public bed your
06:26
pre prosperity in all over all the rest
06:27
of it so candle on the budget is the
06:32
more those the can losses look you’re
06:34
the only person you can challenge me
06:36
either jointly but he says no I’ll give
06:38
you 24 hours to get out of including the
06:40
Bastille Caroline says no no it’s better
06:42
for us to join forces I’ll become a law
06:44
a lawyer
06:45
three because he and Laura some other
06:46
guy named herb gage from the three-man
06:48
triad running this whole system so the
06:50
camera knew the whole system was going
06:51
to collapse and where Cameron did was he
06:55
bought he he raised a lot of money to
06:57
these guys at very high interest rates
06:59
cash too then so would the collateral
07:02
and then skipped town skipped the
07:04
country just before a collapsible wall
07:06
Donald Mississippi bebut I came back had
07:08
cleanup multi-millions to the rate dead
07:10
the stress and resentment of his follow
07:13
wha what their pipes so anyway he may he
07:16
make millions out of us who wrote his
07:19
book a sort of a reflective response to
07:24
this experience the book was very
07:25
influential even let us say was throw on
07:27
publishing and when the early thirties
07:29
and became published printed in 1755
07:31
after he died and was read by everyone
07:34
in France always a fair people only
07:35
intellectuals center Center is extremely
07:38
influential one of the things about
07:40
Catalan well he had mansions in every
07:41
city in Europe they probably the only
07:43
economist has feel sort of murdered I
07:46
can’t think of anybody else’s something
07:48
else on victim or something like that he
07:49
was murdered presumably by his
07:50
disappointed servant skip town with the
07:53
jewels or something anyway he went on
07:56
Murphy told me privately infuses the
07:58
publisher he said he hadn’t got enough
07:59
date on it yet that’s a marvelous story
08:01
claims with Keller I really didn’t die
08:02
very he was heavenly that he skipped
08:04
town himself and went to Borneo was
08:06
paper is a lot of a remaineth I twenty
08:09
years later but any right yes read
08:14
character more look character now
08:16
thinking about Kelly wasn’t exact or a
08:18
free trader but it was really a matter
08:19
of that what he said was he said well
08:22
free trade treasure another Kingdom Oh
08:23
increased when you spend the money will
08:26
increase prices so he advised the King
08:27
not to spend the money really great
08:29
advice and we’re going to get money
08:31
coming and don’t spend it Center on it
08:33
so that liberals I mean we won’t have
08:35
inflation you won’t have this problem of
08:36
deficits amount of trade deficits etc
08:40
okay after came along we had a little
08:45
associate class in mid 18th century and
08:47
of the poor
08:47
well they say fair people
08:49
at court quite muddy in many ways and
08:51
have various deviations the interesting
08:53
thing about Susie craft over the first
08:54
probably real sector school for you know
08:58
the data which the school for was found
08:59
it was a date one moment of July 1757
09:02
when dr. ken a the the founder of the
09:05
grill this thing was met Mirabeau camp
09:08
Mirabeau is that those days in the
09:10
Catalonian the cattle on a site
09:11
immediately shifted a cane a and it
09:13
became a two man school of thought I
09:15
mean yeah to have a school if I have at
09:16
least two people and this was that I’d
09:18
say is a very highly placed cane a was a
09:21
physician distinguished physician he
09:24
became the position of the court first
09:26
of the cook to the king’s pop mistress
09:28
there was a by write a thing about the
09:30
one way to influence the king and Prada
09:31
convert a malaise a favored with the
09:33
king’s pop mistress done by archbishop
09:35
depending on wall early 18th century
09:38
late seven late 17th and kar looking a
09:41
physician to Madame de Pompadour who is
09:44
the king Tom mistress and then become
09:47
this point to a court I’m worried about
09:49
was influential personally just written
09:50
a massive book called a friendly man the
09:54
multi-part work which is
09:55
incomprehensible but the thing that was
09:58
very popular because we written in the
09:59
seventeenth century styled here in here
10:01
doesn’t mid 18th century skies running
10:03
in mid 17th century fathers sort of
10:04
charmed everybody and it was a
10:06
best-seller so little bond can’t along
10:08
Marquita Miraval and organize the
10:10
movement I mean they were exiting in
10:11
cane a they set up their own school of
10:14
for the room journals the run not going
10:17
to reviewed each other’s books favorably
10:19
and so forth and so on those are the
10:21
became sort of a cult of personality
10:22
only guy for the King a was the top guy
10:25
of all time for examples as far as play
10:28
McKinney look like Socrates kind of the
10:30
400 figure out we don’t really know it’s
10:32
either his lip line yeah and it also
10:35
refer them to the Confucius of Europe
10:37
late surge of Europe we’re about what’s
10:40
our faster proclaim the three greatest
10:41
adventure of the history of mankind or
10:43
more writing money and keen a is crazy
10:46
diagram with tableau economy of a
10:48
beginning then put output analysis
10:50
similar hours
10:53
so an a really the railways if there are
10:56
natural rights people are there fair
10:57
people unfortunately little deviation
10:59
Asst they’re very much in favor of
11:01
higher cultural prices when we think a
11:04
name was a farmer and he owned farms and
11:07
there were I think it would have been a
11:09
favor farm price supports if there’s
11:10
anybody proposes he knows they either
11:12
palm price for the other direction home
11:14
prices are kept low and quickly where
11:15
much opposed of that the ice can maximum
11:18
price patrols on corn products I think
11:19
they would have been a very minimum
11:20
price control that come up anyway they
11:22
were definitely there is a few people
11:25
corners their lights and the Shiki gig
11:28
objective the question is if you’re a
11:30
lazy a fair person this came up and late
11:32
78 17th century to how do you doing back
11:35
well obviously the thing do you have
11:36
absolutely monarchy by this time in
11:38
France he just convert the king if you
11:39
can whip the king can establish they
11:41
live here from the top revolution from
11:43
the top so to speak and I would be it
11:44
and so a strategic perspective of been
11:47
alone and Turk and to go to him physique
11:50
rat
11:50
convert the cane he’ll establish lays a
11:52
fair and that’s it body convert the King
11:54
labor officially converts a mistress
11:55
gentleman woman route honey convert the
11:58
cane where you have to convince the king
12:00
it’s really in his interest to have a
12:01
lady a fair system so these tendons
12:03
become utilitarian in that sense no word
12:05
even though physiocrats of natural
12:07
rights people it tells a stress that
12:09
lets feel better had two sides like if
12:11
the kingdom is prosperous now things I’m
12:14
not sure they’re right relieved me the
12:16
king can make a good case for Santa
12:17
Kings
12:18
self-interest is a question inhabitants
12:20
loop every penny in for once don’t want
12:22
I think I have a problem right there
12:24
he’s for teaching perspective I what
12:27
happened II went or go who was a friend
12:29
of the physiocrats politically although
12:30
not economically well a very fair person
12:32
politically the truth I wasn’t popular
12:35
craft finally gets in a fence finance
12:37
minister something to me for this is
12:39
that better oh this is this is a key
12:40
just went out and if Susie stop this is
12:43
doing like they’re fairies he’s kicked
12:45
out of course other vested interests and
12:46
so work at that time I left point
12:49
physiography sort of disappears Heather
12:51
said ka was losing interest and he
12:53
cannot hit he was not interested in
12:54
economics and told in his 60s and then
12:57
he got interested in a former cult by
12:58
his 80s or whatever he was and he
13:00
probably died were just engaged in
13:02
mathematics he claimed to square the
13:03
circle
13:04
which of course is impossible anybody
13:06
kind of solve upon the squaring the
13:07
circle firing of children I think really
13:09
live a miniature July I prefer you to as
13:13
a magnificent person like I’ve written a
13:15
pamphlet on this thing which is
13:16
available here I thank you
13:18
Mises Institute sure is magnificent it
13:21
was great
13:21
well I my really favorite character and
13:24
history of thought considering also the
13:27
fact that he was personally spend very
13:28
little time in economics he was busy
13:30
popular craft on turned on governor and
13:33
mr. this time intellectually was spent
13:36
on other things history linguistics it’s
13:38
an all-round type wrote and read a lot
13:41
on us poppin he can I make topic he’s
13:42
only sort of the fourth hand maybe was
13:45
pressed into it when he had to tell
13:47
somebody something for example his
13:48
reflections on wealth loyalists book
13:49
which is about fifty pages was written
13:51
under severe time pressure he’s trying
13:53
to form questions asked to Chinese
13:55
students and France about Chinese
13:57
economy or preparing them ask about
13:58
French economy I and so we wrote as a
14:00
sort of outline to himself as a
14:02
memorandum self of what – preparing
14:04
questions that this is a great work on
14:06
wealth and capital Theory etc so he
14:09
wrote all this stuff in a severe time
14:10
pressure so – it often absolutely
14:12
magnificent he has the whole Austrian
14:13
stuff in there not only lays a fare
14:15
completely there fair without any of
14:17
smith’s evasions qualification etc but
14:20
also he’s got austrian time preference
14:21
theory also in capam bavarian capital
14:24
theory is that money and process
14:26
analysis got the whole business and done
14:28
but they it’s just sort of in passing
14:31
almost a few causes and i would strongly
14:34
recommend an emu there if two of those
14:36
economic writings have been translated
14:38
in english by PT growler vagin the dutch
14:44
rebellion expert in New Zealand I think
14:47
and it’s called economics of a r.j.
14:51
Torgo it’s been it’s one of these things
14:53
a better paper back costing about sixty
14:55
dollars I think I got insanely expensive
14:57
but it’s worth it
14:59
and that’s regular notes and
15:01
introduction is an annotation is my
15:03
glory legend you can all makes a tour
15:05
job and yeah it’s just remarkable
15:08
Shapiro is very good on to go to Rob’s
15:10
that was really the originator of save
15:11
law off its lithium capital the whole
15:13
thing about the Elvis
15:15
since the man it separates out all these
15:16
things went or go just fantastic it’s
15:18
the propeller overestimate his
15:22
importance and his brilliance in this
15:25
area though so that the entrepreneur and
15:27
their asthmatic is excessively a better
15:29
link amlong but he he stresses
15:31
capitalist metaphors being a
15:32
particularly important
15:33
he’s got the whole circle sniffing and
15:35
capital fury and investment all that
15:36
savings investment theory he says well
15:38
the important things accomplished
15:39
entrepreneur with the person commits
15:41
resources and capital to 200 to an
15:43
uncertain world Kula and a prayer ship
15:46
he’s just phenomenal and again extremely
15:48
influential and saved up that
15:51
expectations got the whole plan in there
15:53
he also got my world diminishing returns
15:55
a beautifully presented
15:57
shrim Peter says it was not no
15:59
presentation of lore the mission returns
16:00
to equal until about 1920 he’s written
16:03
about 1760 1770 other this is forgotten
16:06
its whole to go a corpus wraps out of
16:08
knowledge again talking about last
16:10
paradigm probably last until right now
16:12
become recently 2016 all right why is
16:16
was an interesting story well by the way
16:18
along with Torgo you have Condillac
16:20
brother and mom believe of the utility
16:24
theorist and philosopher points out very
16:28
clearly even more clearly than tore
16:29
garlic but exchange comes from double
16:32
inequality of wealth that we’re in call
16:33
utility in other words the reverse
16:35
inequality of exchange I mentioned
16:37
that’s that valid absolute priority
16:40
there’s others like Kalyani who
16:42
supposedly cooked on money and he’s your
16:45
23 in 1751 job a galley on another great
16:49
character whose Neapolitan the loved
16:51
France is spend most of his time in
16:52
France as a diplomat his book on money
16:55
as super has not been only parts of her
16:56
than translated unfortunately yet by way
17:01
Galliani was especially counted ironic
17:03
witty and area dine is four and a half
17:04
feet tall became a social line on the
17:06
palace salons and soon as he got the
17:08
palace he can begin a sellout in other
17:10
words food we gotta get witty in and
17:11
kind of social lion needs to become anti
17:14
laissez faire gives up the utility fear
17:16
in terms of favor of protection Victor
17:18
Calif
17:18
anyway his great work with retinoids the
17:21
before is Parisian reading experience
17:24
also I should say the family of
17:25
mathematical economics comes in
17:27
17:20 Christmas fortune on a road amount
17:30
of economics by Bernoulli the highest
17:32
annual murder whole bunch of Bernoulli’s
17:33
old whom were French mathematicians are
17:36
voting theorists and letters of the
17:38
calculus things like that Bernoulli
17:39
arrives the mathematical theory of
17:41
emission utility of money truly out of
17:43
left field I was a web address in
17:45
economics or either before or since just
17:47
arrived with this as part of its
17:49
probability calculations and he’s got
17:51
whole series of fallacies of course
17:53
wrapped up on this the missioning
17:54
marching tooling money already been
17:56
arrived at by a couple of the spanish
17:58
scholastics the sixteenth century what
18:01
he does of course immediately says well
18:02
as a vu DX was the supply of money as a
18:07
excellent utility of you as soon as you
18:10
do that you have about two at least two
18:11
major fallacies right there one of the
18:13
life is not like the calculus there’s no
18:15
infinitesimally small actions in life
18:18
everything is discrete in the word
18:19
everything it’s qualitatively different
18:21
and therefore there’s no infinitely
18:23
small steps that we can take it really
18:26
pluses that out because without calculus
18:27
right right there
18:29
and the ux thing is a ratio and since
18:31
utilities we know it’s ordinal or not
18:33
cardinal there’s no such thing as a
18:34
ratio can’t what do I know where meet
18:36
I’m a ratio of utility there some money
18:38
anyway does make much sense but since
18:40
utility is not an ordinal and therefore
18:42
not cardinal you can’t put it into a
18:44
little ratio it can’t equate as anything
18:46
either so the whole thing the whole
18:47
series about fallacy pile on fallacy
18:50
also thinks those are says or they live
18:53
proof or no evidence whatsoever that the
18:55
utility of money is an inverse
18:57
proportion the client an inverse
18:59
proportion of the quantity of money what
19:01
but first of all what are the mean
19:02
inverse reports second well no evidence
19:03
whatsoever some other mathematician said
19:05
no it’s not inverse proportion upon my
19:06
name is a proportion of the square root
19:08
of the quantity of money even more so
19:10
lightly but what is this mean
19:11
but he would he talking back well that’s
19:14
what a butter much less what’s the
19:15
evidence for it just sort of hot air
19:17
he’s me the only way to describe this
19:19
all he knows about your touring money is
19:21
with the clients in other words you have
19:23
a stock of money right does this they
19:25
would have a falling demand curve so to
19:27
speak point utility and it declines as
19:29
you get as each unit utility of each
19:31
unit the client as you add more that’s
19:32
it don’t know about this
19:33
there’s no ratio with nor inverse
19:35
nothing and then of course he further is
19:36
measurable between people even more
19:38
fallacious somehow you getting
19:39
you can compare everybody’s utility
19:41
money and sum it up and add it up and
19:43
divide it all these things of precursors
19:45
of mathematical economics which you know
19:46
we know and love today so like the
19:48
beginning this stuff when we need to say
19:51
about it okay and speculation here why
19:55
does the knowledge of catalog Torgo drop
19:57
out and hold french utility is a fair
20:00
time preference whatever tradition and
20:02
the preneur ship and why do people then
20:05
think that Adam Smith founded economics
20:07
he always preceded Adam Smith all these
20:09
guys wrote before Wealth of Nations kind
20:13
of like whether the same year
20:14
Palmerston government unfortunately
20:16
person’s forgotten on the great Smith
20:18
Mian wave
20:19
why does Smith cutter said to make waste
20:21
and rubbish of 2,000 years of economics
20:24
thought I’m why would you allowed to get
20:26
away with it why don’t nobody even say
20:27
that than you doing this for one thing
20:29
cgb say who’s the succeed Torgo in the
20:32
French tradition never refer to Twitter
20:36
on any of these people he knew them he’s
20:37
a disciple basically Torgo and kind of
20:39
like all these people he was a classical
20:41
liberal as a fair person carrying on the
20:43
battle through the French Revolution and
20:44
after it he’s not just an economist he’s
20:47
also a political thinker and activist
20:49
and the question is why does say say the
20:51
Smith founded economics say is one but a
20:53
few people responsible for the myth why
20:55
me taught about the French tradition he
20:57
really disagree with Smith on with
20:58
everything really read the book there
21:00
was nothing smithy and about it no of
21:01
course the production theory is only a
21:02
theory and so you totally in
21:04
productivity and hardcore lays a fair I
21:06
think there’s only the source relations
21:08
I puzzled over this for quite some time
21:10
how the smith myth originated why these
21:12
guys the knowledge of the French
21:13
theorist I lost
21:14
they were discredited in French France
21:16
itself it’s relative for two reasons one
21:19
because Twitter was locked in with fizzy
21:21
crap even or he really wasn’t it was
21:23
political ally the fizzy crap is not an
21:24
economic
21:25
I mean way beyond the fizzy craft before
21:27
that agriculture of the only productive
21:28
factor production crazy tabloid gonna
21:31
meet state as to rhythm leave any of
21:33
this stuff that was linked with a
21:34
physique rats politically and
21:36
politically especially linked up an
21:38
absolute monarchy because if their
21:39
strategic perspective was the effect
21:41
they were failure absolute mind because
21:43
it’s simple you convert the king and
21:44
I’ve said you get lays a fair one mess
21:45
around democracy and mass movements
21:47
convert the king and exactly try to
21:49
convert a whole bunch of kings
21:51
the great story about Catherine the
21:52
Great was reigned erson ideas Western
21:55
ideas and she call these people to
21:56
Russia other mercier lariviere the way
21:59
French physical a political theorist
22:01
natural rights theorist explained to me
22:03
mr. Revere about what this for theocracy
22:05
Golub and he says well madam essentially
22:07
that the laws of nature of govern
22:10
natural rights in northern education she
22:12
said what room is there for the king
22:13
well the king as far as it was in nature
22:14
she says thank you Monsieur of imran
22:16
light lane I didn’t want to hear this
22:19
there’s no rail for the King whatsoever
22:21
as a matter of fact was one wonderful
22:22
guy up the list called Margrave of Baden
22:25
who’s a fizzy crab convert he speaks
22:28
Suffolk through not Mercier but some
22:29
other that we’re about somebody he says
22:31
gia teach me a low role role for
22:33
government at all in your system he
22:34
could all be played a fair so I’m an
22:36
anarchistic a guy drive I don’t notice I
22:38
we need the government for the framework
22:40
and blah blah blah
22:41
sufferin and of course the mother is
22:43
perfectly correct the implications of
22:45
their natural rights you don’t need the
22:47
government role but anyway there were
22:49
favor of absolute monarchy of
22:50
physiocrats and so that after absolute
22:53
mana he disappeared after the French
22:54
Revolution they were politically
22:55
discredited nobody want to listen to any
22:56
guys the favor of absolute monarchy and
22:58
also cuz the physique rest never really
23:01
believed by this time agriculture was
23:02
the only productive factor but there’s a
23:04
lot of industry growing at the time so
23:05
those two reasons I think the physique
23:08
rampant or I’ll gather spreaded that
23:10
unfortunately in France nobody refer to
23:11
them in the knowledge drops out the lost
23:13
paradigms lost the whole thing that
23:16
whole thing Rob sighs a real tragedy for
23:18
economic thought remembers stuff for
23:20
centuries couple of British essentially
23:23
Scottish enlightenment begins were
23:24
gracious the same guy mentioned the
23:26
policin skull on metropolitan scholastic
23:28
for natural will hurt Protestants the
23:30
natural law people grocers were heavily
23:32
influenced by the Spanish scholastic by
23:33
Suarez etc what happened that is a proof
23:37
endorsed was a Lutheran motion this is
23:42
early seventeenth century a spoofing
23:43
olirzon mid delicious is early 17th
23:47
century and proven or middle or late
23:49
proven over several popularizer Rocha so
23:51
people who saw reading poofing north and
23:53
not gracious gracious mentioned the
23:54
Spanish classics Hale Roma’s being his
23:56
predecessors proofing or Pina hardcore
23:58
Lutheran hated Catholic refused to
24:00
mention any Catholics
24:01
as a result the knowledge of Scottie and
24:04
I’m excited so I think political theory
24:06
drops out almost forever who forgot to
24:08
mention it and proving I was read by the
24:10
Scottish enlightenment people one reason
24:13
by Yui Scot knowledge is class the
24:14
economics drops down Latin drops out
24:16
come onto the court usually wrote on
24:17
Latin not too many right in this arena
24:20
and the fact that the river and shrimp a
24:23
tourney people actually read a Latin is
24:25
one of the reasons why they were able to
24:26
bring them back so poufy dress brings
24:29
the natural law of doctrine and semi
24:31
well I wouldn’t say lazy affair sort of
24:33
semi free-market three it’s very vague
24:34
at least it’s something
24:36
the first Scottish enlightenment person
24:38
the first professor I forget whether
24:40
Edinburgh our last guy was one of their
24:43
well fish him calm Michael the only
24:45
professor of about two years before he
24:47
dies but he’s a professor and they began
24:49
the professorial before that there were
24:51
readers or whatever they were and he
24:53
translates proofing too often like the
24:54
commentary he’s the founder of the
24:56
Scottish political economic wing in the
24:58
Scottish enlightenment and so you got
25:00
proof it off Carmichael and Carmichael’s
25:02
the teacher of Francis Hutcheson who in
25:04
turn of the Peter Adam Smith we have a
25:07
car Michael Smith Hutchison connection
25:09
by the way Smith the famous phrase talks
25:13
about the never forgotten teacher of
25:14
Francis Hutcheson praises him however we
25:16
only praise him in a private letter to
25:17
the University of Edinburgh then he
25:20
never talks about Hutchinson and welcome
25:21
nation artifice LT part of Smith’s
25:23
Columbus complex he originated on with
25:26
everything anyway we’ve I’ve really
25:29
naturally of people come Michael
25:30
Hutchinson etc Mellish free-market and
25:33
natural rights more or less I mean not
25:35
not hardcore but so softcore classical
25:38
liberals outside Hutchinson by the way
25:40
as it has a very good dark attack one of
25:42
the places where I differ a little Hayek
25:43
strongly on history of scores of the
25:46
status of Mandeville for an hour
25:48
mandibles a Dutch physician who lived
25:50
among the most of the wife who were the
25:52
favor of the bees and other such fables
25:55
which Hayek claims the original
25:57
originated of the idea of spontaneous
25:58
order and the free market a free market
26:00
works into work the line I just read
26:02
that totally I take the Viner position
26:04
which is the Hutchison’s position which
26:05
was a essentially Mandeville dismantling
26:08
a status would also favor the bees
26:10
really a plea for sort of pre Keynesian
26:12
sweeper glory
26:13
consumption sodium is really bad because
26:15
you benefit the market benefit society
26:18
by consuming a lot Hutchinson had a good
26:20
point I think basically pointed out
26:22
Hutchinson matters only gets consumption
26:24
in favor of libertine ISM a little bit
26:26
penis robber libertarian sort of
26:28
straight I think it’s the correct
26:29
interpretation is what minor points out
26:32
the matter was a follow up book called
26:35
letters from being on or something like
26:37
that kind of explicit I’m more explicit
26:40
than the favor of these so we have now
26:42
and only both car model and Hutchison
26:44
was actually totally theorists so we
26:46
totally scarcity theorists a value
26:49
economic value what about by the
26:50
language Brandon Lana supply and mana
26:53
scored lights
26:54
Turbie and diminishing utility and
26:56
scarcity and there was especially the
26:58
Scholastic position if they were policy
27:00
the Scholastic’s has this is true rate
27:02
over there maybe with your Emmanuel come
27:03
in of course the alien labor here out
27:04
has become it’s very strange how does it
27:06
come in and be is not much as Sony and
27:07
it’s not calling Michael come by killing
27:09
or whatever and not only that but Smith
27:11
himself as lectures give the correct
27:14
version in other words the basic you
27:16
know the famous paradox of value which
27:18
says place that on economics for paradox
27:21
of value which is quite famous is that
27:24
how come if diamonds red or whatever
27:26
Tiffany want to do this necessary to
27:28
life but it’s good the staff of life or
27:30
water is good how come it’s very cheap
27:32
on the market where it’s diamonds are
27:33
sure of cookery in the luxury how come
27:35
they’re so expensive in other words you
27:37
have a famous flipper than use value and
27:39
when you get to use value farmers are
27:41
table mothers great but he cannot make
27:44
value of somehow violates that Smith
27:46
allegedly couldn’t solve this for card
27:48
Oakland insolvent so I don’t call my
27:49
consumption something that’s trust just
27:51
flops out you have a disastrous split
27:53
with a use value and economic value
27:54
which results in Marx and Weber and all
27:56
the whole thing is a production for use
27:58
versus production for profit really
27:59
stems from this idea some are the market
28:01
values football’s over putting stuff
28:05
like bread on and we’re in real armor
28:07
and real terms of better much more
28:09
valuable so the usual story is it’s this
28:11
you know through this paradox of value
28:14
and then the rest rien finally solved
28:16
it’s not really true that’s the such as
28:18
a solvent scholastic it’s all there’s no
28:20
problem they realize what the problem
28:21
was if diamonds are very scarce has lots
28:24
of bread around for
28:25
simple you have enormous amount of red
28:27
enormous amount of water each unit of
28:28
water rather than we worth much less
28:30
than diamonds or to our female
28:32
photographically weaker arm and much
28:35
more scarce supplies of scarcity in
28:37
youth earlier for her bit not only
28:39
hutches itself but Smith himself had
28:40
solved in lectures his unpublished
28:43
lectures at the time
28:44
Smith realize that it’s not the rest of
28:46
nations he clearly changes it imposes
28:49
places the power C value is done ruins
28:51
possibly can always from then on and you
28:53
might say why for the lectures were
28:55
twenty is a four maybe he’s assuming
28:56
everybody knows the lectures and then it
28:58
goes on with that’s not sure the
28:59
butcher’s were never published in his
29:00
wife’s not only published fairly
29:01
recently twentieth century building is
29:04
Pikeville are we have in Smith not only
29:06
a decline and loss of economic thought
29:09
from the French but also nitrogen or
29:11
even himself as previous persona twenty
29:13
years before this is true not only
29:15
paradox of that go securely human the
29:18
human or national money flow suffer he
29:20
doesn’t even have that but but drops out
29:22
whole ideas of money international money
29:24
equilibrium in or drops out it’s very
29:26
strange
29:27
listen as well collections of the weird
29:29
book embodies that what not only is it
29:32
not true that he’s not create economics
29:34
that he lost a lot of economics even
29:36
from his own previous twenty years ago
29:38
don’t previous being whether you’re
29:39
caught before
29:41
sisters growing up as a young man 1750s
29:44
Tasha enlightenment hits Scotland so the
29:47
University of Edinburgh and Glasgow
29:49
became becomes the shining lights and
29:52
lecturer lights in Europe firstly in
29:53
Britain this point Oxford and Cambridge
29:55
a degenerated it’s a sort of rich man’s
29:57
plaything with whatever they’re not
29:58
intellectually important or regretted
30:00
that are useful that time and so as a
30:02
result Edinburgh and Glasgow become key
30:05
sector the people have more over Europe
30:07
to study there Smith Missouri
30:09
started off as a Clubman clubs are very
30:12
important eighteenth-century social life
30:14
intellectualize everything he was matter
30:16
about eight different clubs each of
30:17
which had weekly meeting any things like
30:18
that was one club by the way and when
30:21
David Hume is friend David you must
30:22
present the two were very different they
30:23
never spoke a lot there are the smartest
30:26
for their or on Miss agreements with
30:29
them and certainly the bias people in
30:30
the club in any way so there’s a big
30:32
Club life intellectual life developing
30:34
plus the fact we have pipe annex
30:36
between and within the Church of
30:38
Scotland which was the established
30:41
Church in several British compromise the
30:43
Anglicanism of the established Church in
30:45
England Presbyterian established Church
30:47
in Scotland angular the Anglicans in
30:48
Scotland for tremendously good movement
30:50
of the Jacobite camp on the way and of
30:52
course the pure Calvinists or whatever
30:54
the this is a fraction broke often
30:56
established the free cook of Scotland
30:59
any right and the established Scottish
31:01
Presbyterian Church for the titanic
31:03
struggle between the moderates as their
31:04
coronium and the evangelicals the
31:06
moderates consisted of all the bright
31:08
people and Murphy types in Sutton and
31:10
Glasgow and Edinburgh I’m a joke of
31:12
everybody else they will press rural
31:14
masses as a result of fantastic
31:17
manoeuvring even though the moderates
31:18
from the minority of river control the
31:20
church until about 1800 approximately 50
31:23
years of so headed by principal
31:26
Robertson when you’ve long Batson how
31:28
much rather people whom slipper was a
31:29
member and they all knew each other and
31:32
there were friends and compact
31:34
compatriots even though the the moderate
31:37
or not has hardcore Calvinists obviously
31:39
the image Allah calls there was third
31:41
putting Calvinist especially Smith Hume
31:43
was not the least human I guess was
31:44
tending toward deism or 8 years and
31:46
whatever he couldn’t find an academic
31:48
post in Scotland by the way I was an
31:50
interesting commentary a convenient
31:52
finding recently post because of his
31:55
religious views he was not impoverished
31:58
however since he was at risk by
31:59
aristocrats and the penalty wealthy was
32:00
the crack remember the key family which
32:02
I think emerged now and double assume
32:04
well that’s all the same group so
32:07
Smith’s the start often in this in this
32:08
environment however it was also deeply
32:10
Calvinist even though moderate his
32:13
mother and one of them will come an
32:14
Anglican minister and sent him to Oxford
32:16
I believe in order the part of Anglican
32:18
fellowship he spoke when we graduated
32:20
from an Anglican minister and said
32:21
heckler Rani’s we became a Glasgow
32:25
professor he had a sign of Westminster
32:26
Confession which was one of the
32:27
requisites that he had no difficulty
32:29
apparently signing it I think this
32:31
accounts well not only for adoption
32:34
Labour theory of value leighton in the
32:36
game and discarding the utility theory
32:38
also for other things one of his
32:41
deviations from lays a fair one of many
32:43
deviation down to a minute but he’s a
32:46
favor of usury laws in favor of maximum
32:48
interest rate laws
32:50
restricting the suppliant credit now
32:51
Eddie West was a friend of mine was a
32:53
barber for Smith and worshiped Smith
32:55
everyone he west couldn’t understand
32:58
this he said we had the window
33:00
discussion of the candle on conference
33:01
with Smith of course came into the
33:03
general object of attention West our
33:06
Chia Smith deviate should have
33:08
understood that if you have a maximum as
33:09
it was maximum price control you have a
33:12
maximum interest rate or restrict the
33:13
supply of credit and so forth even seem
33:15
to realized as sort of a hole in the
33:16
doctrine roger garrison we’ve gave a
33:19
commenter than that the Austrian pointed
33:21
out quite the contrary said understood
33:23
all too well with the concept of what he
33:25
wanted to restrict the supply of credit
33:26
that’s the whole point he understood
33:28
that usury laws would restrict the park
33:30
right and he loved it he wanted to do it
33:31
right but if he wanted he hated
33:33
consumption he wanted credit to be
33:35
channel into the prime borrowers will
33:37
take Point mint frustrates the low
33:39
interest rate boy he wanted to exclude
33:40
whom Cray water rationing credit so that
33:43
speculators and high consumer types and
33:45
with non Calvinist types would not get
33:47
credit
33:48
he wanted the channel credit away from
33:50
dissolute types okay
33:53
it was quite conscious on his part I
33:55
think it’s absolutely correct even when
33:56
he gets to the diamond what are done in
33:59
bed paradox the way he talks about is
34:01
kind of it he doesn’t say that diamonds
34:02
are luxury and therefore of lesser value
34:04
so diamonds are of no value no value and
34:07
he’s a custom are saying widths method
34:10
attack on consumption attack on in
34:13
material cousin one of the reason I
34:15
think well that’s the idea that some
34:16
laborers productive labor at which which
34:19
is in gate which embodies material
34:20
objects and other labor which is
34:22
unproductive members services he wasn’t
34:24
so much interest in material objects in
34:27
Kathleen one a capital investment in
34:29
other words he disagreed with it with a
34:30
little time forever the saving
34:32
consumption preferences of the market he
34:33
wanted more saving less consumption
34:36
basically and one of the ways in the
34:38
usually Lord is one way to channel
34:39
consumption of the prime borrowers and
34:42
general he disliked
34:44
consumption flipper II one of the tax
34:46
consumption where all sorts of ways by
34:48
which he would as they restructure the
34:51
Preferences of the market and it will
34:53
fit them with like fossilized Calvinist
34:56
approach to all of us
34:56
where the luxury becomes evil anything
34:59
beyond some moderate consumption becomes
35:01
a wicked
35:02
so that was one of his mother’s vivia
35:04
the idea of productive labor fits right
35:06
into that building up capital investment
35:08
and so the opposite deviation from the
35:11
physiocratic remember build one we’re
35:12
only consumption is that a saving is
35:14
evil this is the opposite a lot of free
35:16
market economists by the way still
35:17
homeless laughing read any economic
35:20
literature financial literature it’s a
35:22
surprise cider for example will say we
35:25
have to lower our marginal tax rates
35:26
because we want people to save and
35:27
invest more saving investment good but
35:29
if say the investment good then the
35:30
consumption of being some way bad that’s
35:32
what people are adjusting their own
35:34
proportions and so I realized this
35:36
you’ll get the same sort of a even now
35:38
the same sort of idea that saving good
35:40
and of course consumption bad is not
35:41
going to really stated of course it is
35:43
part of the part of the paradigm gonna
35:46
with money very few people are willing
35:47
it will allow the market individual and
35:49
market of the side alone saving
35:50
investment preferences the addition of
35:53
the fact that leaves out productive
35:54
labour stuff creates a lot of problems
35:56
theory we value is totally confuse very
35:59
confused right er I think theory value
36:01
is about three or four independent
36:02
coexisting theories of valuing their and
36:04
one hand he puts too much emphasis on
36:05
division of labor the neglect of
36:07
investment of capital Yemen handy and
36:09
later books per the end of it but he
36:11
attacks the division labor courting
36:13
alienation or so the stock analyses and
36:15
sort of pre Marxian anti-alienation one
36:18
of the things about away one of the
36:19
reasons wise he worries about the
36:21
division of labor is it weakens the
36:22
martial spirit of the people if you’re
36:25
if you’re if you’re there I’m you’re
36:29
making parts of a pin or your petty
36:31
tightening both you somehow lose the
36:33
spur going out in the conquering and
36:35
he’s very unless I was very poor or
36:37
something is really overlooked and his
36:40
theory of money leaves out even the huge
36:41
stuff much less the candle on stocks on
36:43
money in London and prices he’s got a
36:46
lot of stuff he leaves out a lot of
36:47
stuff that we had at either he had or
36:49
Hutchison had previously I have a list
36:51
of a compilation of deviations from lays
36:53
a fair method being wrong I’ll tell you
36:57
that because there’s a navigation acts
36:59
of national offense which include
37:00
practically everything the martial
37:02
spirit decay your favorite
37:05
government-run education and order the
37:07
Inc LK obedience to the state among the
37:09
populace scarcely a lazy a fair a
37:11
doctrine yeah
37:13
quoting from Smith and instructing an
37:15
intelligent
37:16
besides are always more decent and
37:17
orderly than an ignorant stupid one
37:19
a funeral sells more respectable more
37:22
likely to obtain the respect of their
37:23
local Superior says Smith and therefore
37:25
motor supposed to respect those
37:26
superiors unless I have to be miss
37:29
London any wanton are unnecessary
37:31
opposition to the measures of government
37:32
that’s why your favorite government-run
37:33
education sounds of status let’s face it
37:36
non factum and Bingley’s a fair person
37:39
he’s a favor regulating bank paper
37:41
allowing fraction was their banking
37:43
which most of the predecessors were
37:44
against by the way including Hume Hume
37:47
was a hundred Pissarro hundred percent
37:49
gold person April old banking factory
37:51
where banking is fraud most of most of
37:53
his friends a Assessor their release
37:55
method starts bringing in bank bank
37:56
credit in favor of Public Works
37:58
including highly vigilant harbors on the
38:01
rationale of private enterprise would
38:02
not have the incentive uncle to maintain
38:04
them properly a lot of odd position to
38:06
take and a particularly likely a list of
38:08
taxes which he advocated each of which
38:10
interfere in the free market for example
38:13
you sort of pre georgeous as Ricardo was
38:15
definitely pretty gorgeous CEO these
38:18
guides including Smith believe of a
38:20
landlord have no function and the
38:22
farmers had a function the landlord’s
38:24
just only sure the land was functionless
38:25
and therefore can be taxed if the tax an
38:27
unearned
38:28
tax on rent they hold smearing of rent
38:30
the whole vicious smear of rent which
38:32
starts with really starts with Smith and
38:34
what Ricardo maximizes it but they
38:36
didn’t understand for example a landlord
38:38
reform very important function namely
38:39
allocating scarce land extremely
38:41
important functions they do not there
38:43
didn’t think in terms of allocation
38:45
there’s a favorite taxes on import
38:47
foreign manufacturers moderate taxes
38:49
taxes the exporter world world a lot of
38:52
even even when the free trade thingy has
38:53
one of deviations on that and heavy
38:56
taxes a luxurious consumption as I
38:57
mentioned taxes on luxury carriages so
39:01
simply the code pack the inverse and
39:03
vanity of the rich junk wall once again
39:04
the Calvinist thrust it also has a again
39:08
a puritanical hostility of liquor which
39:11
which even though is not pushed
39:12
millennialist but the liquor the
39:14
anti-liquor thing was already there a
39:16
call for heavy tax on the stories or the
39:18
crackdown on hard liquor and which
39:20
people who drink instead of the coal
39:21
wholesome and invigorating liquor a beer
39:23
and ale somehow that was okay with hard
39:26
liquor was evil
39:27
send them leave on a tour with Hillary
39:31
oh hi or ETL packs and retail sales of
39:32
all liquor to the Scourge ale houses now
39:36
perceive our favorite soup the rich
39:38
policy progressive income taxation let
39:39
it never be forgotten with Smith the
39:41
hope I mean who would wear a smith pie
39:43
after this right also i say usually what
39:47
was i already gotten into even though
39:49
tree wall and candle already black that
39:51
usually rolled off the face of the map
39:52
even even dentin was against usually
39:55
wasn’t even meant for my least favorite
39:57
people also an interesting thing about
39:59
something one of the most interesting
40:00
two charming things as when all of my
40:02
anderson Gary Anderson I think Paulson
40:04
was a wellness thing right a more
40:06
miserable
40:06
clowns left on the custom-house you want
40:09
you saying about stuff here’s his late
40:10
free-trade laser a fair person how come
40:12
he spent the last 12 years of the wife
40:14
of the customs official much of the
40:15
cousin developed a number of customs
40:17
Commission airing commissioners running
40:19
the whole custom system you know
40:20
extracting power-ups and all that
40:22
cracking down on smugglers how does how
40:24
do you how do you square this and use
40:26
your whitewash of Smith as well he just
40:28
uses a cynic cures call a no-show job I
40:30
gonna Bronx me a pothole inspectors rate
40:35
thousand dollars a year you if you plant
40:36
a pothole the reported be cool in this
40:40
is a pothole would be five yards it’s
40:42
very easy to do this so but it turns out
40:45
however is a great was another no-show
40:46
job he he worked hard at it there three
40:49
days a week earners full-time you and he
40:51
loves it not only that had no qualms
40:53
about he loved it he was writing letters
40:54
to people saying boy oh boy we got
40:55
another smuggler
40:56
today we own for cracking down these
40:58
people so like Reagan claiming event
41:00
income taxes and maximizing IRS funds
41:02
and power and you ask yourself which is
41:06
he really affair run well you look at
41:08
his actions speak louder than the words
41:10
here some people claim while he was too
41:12
bad a Smith didn’t do any more academic
41:15
work and they lecture what the world the
41:17
nation but he didn’t he said no he loved
41:18
us he could commander he could have
41:19
gotten a top academic post with almost
41:21
as much money he loved he liked this
41:22
stuff it was great somebody with the
41:24
Scotland on Henderson it sounded good
41:26
found with minutes of a custom house
41:27
actually found out what he was saying
41:28
what he was doing
41:29
cracking down just one quote from Smith
41:33
he writes to a fellow customs official
41:35
in December 1785 he says may perhaps
41:37
give the gentleman pleasure I mean the
41:39
guys writing to the informative net
41:41
revenue
41:41
rising from the customs and Scotland is
41:43
at least four times greater than about
41:44
seven or eight years ago we took over
41:46
has been increasing rapidly these four
41:48
or five years pass and the revenue of
41:50
this year over a week by weeks one half
41:51
the revenue latest former year I find
41:53
myself as I could increase no further
41:55
Olga blossom are they however a champion
42:00
of lays a fair and free trade so this
42:02
said he gets this undeserved protection
42:05
of being with a pop of the founder of
42:06
economics and the other guys arrest and
42:09
we cumbersome smithy ins now I think
42:11
there’s a Google Stewart for example
42:14
with Smith’s descendant and University
42:16
of Glasgow but a very few people study
42:18
on those specimens up but or everybody
42:20
can think I’m studying under Stewart for
42:22
about 10 or 15 years he was a big shot
42:24
professor of political economy at the
42:25
Glasgow nearly studied James no study on
42:28
there had a whole bunch of other people
42:29
McCulloch and the whole whole group from
42:32
Scottish group when they get to the
42:33
Labour theory of value is pretty clearly
42:35
that the the propellers are over theory
42:37
of I not only Smith but also his
42:39
electric centers James Miller was
42:41
Scottish originally a top Scottish
42:43
Calvinist was trying to studying for a
42:44
Presbyterian ministry and as somebody
42:47
said when James Milliken won money he
42:49
lost his Calvinist faith it became an
42:50
atheist he continued the same zeal the
42:53
world salvation and crushing the enemy
42:55
whatever they had before his revered
42:56
cadre for
42:57
cadre doctrines continued a pace as a
43:00
matter of fact was a great quote about
43:01
James Miller that he when he was a cork
43:03
or Calvin if he hated Hume for
43:05
skepticism and we 180 if he also hated
43:08
you for the same reason humans to
43:09
mineral headers and stuff like all in
43:10
something it wasn’t hardcore enough kind
43:12
of charming doctrine
43:13
yeah well Bentham was a smithy and start
43:16
off life is a smithy and devoted Smithee
43:18
and it wrote a very good his only good
43:20
book on his defensive usury which he
43:21
attacked Smith heard selling out on the
43:23
usury question he wrote that in 1790s
43:25
when he reserved
43:26
Ruth Smith Ian Bentham force was not the
43:29
founder but probably the big systematize
43:30
of utilitarianism better opponent of
43:32
natural rights natural law or whatever
43:34
we have to cut through the Benthamite
43:36
movement whole bunch of Benthamite
43:37
surround you cut through you find the
43:38
real core of Bentham ISM which is paying
43:41
monstrous he of course nothing really is
43:43
the founder of modern economics a sense
43:45
of warfare economics cost-benefit
43:46
analysis it all comes in the gun to his
43:49
people James Maryland John Stuart Mill
43:51
were essentially met the might even
43:52
bring in the Bethan light
43:53
replacing whatever international law
43:55
doctrinaire was and I think it’s all
43:58
fallacious I mean the personally you
43:59
know cameras are fallacious and social
44:01
certainly social utilitarianism where
44:03
you try to add up personally utilities
44:05
and personal benefits and figure out
44:07
what the maximum general greatest good
44:08
for the greatest number is it’s obvious
44:11
to me obvious nonsense you can’t have
44:12
them up it’s all utility a subjective
44:14
and ordinal nothing’s same as phrase the
44:16
greatest good for the greatest number
44:17
which is sort of a cornerstone of his
44:19
doctrine one of the problems that of
44:21
course one of the many problems whatever
44:22
supposing you’re in the lesser number
44:23
and what what happens then you troparion
44:28
is me justify almost everything I was
44:29
like I think that’s a might sort of
44:30
mythos in other words this is no justice
44:33
this is a natural rights justice or
44:35
anything else for manipulating
44:36
everything for alleged cost-benefit
44:37
arguments for example take the idea of
44:40
say your punishment theory which is an
44:42
arcane part a libertarian doctrine the
44:45
mint reminds of court pure deterrence
44:46
theorists and of the believed don’t
44:48
believe in justice is all the talents
44:49
what we tell it doesn’t have for example
44:51
to be curved take real and bolus or
44:54
situation most people don’t want to
44:56
commit murder for whatever reason they
44:57
don’t like get their against that
44:58
they’re reluctant to commit murder yeah
45:00
a lot of people are willing to steal an
45:01
apple from a push Carter from the food
45:03
store therefore coin a purity of Kant’s
45:05
theory punishment for murder should be
45:07
very light and punishment for Apple
45:08
stealing should be capital punishment
45:10
preferably in public make an example the
45:12
stealer I most of us think that’s
45:14
something wrong with us is what the
45:15
cross was counterintuitive there was not
45:19
so much that most of it have a beautiful
45:22
even we haven’t don’t have an articulate
45:23
a theory of it doesn’t throw that all
45:25
out
45:25
that’s an i it’s also in a favored
45:27
example of punishing the innocent
45:28
execute the innocent provided the public
45:30
doesn’t know they’re innocent
45:31
the public thinks they’re guilty it’s
45:32
good enough no moral principle whatever
45:37
my wife talked about with nothin is the
45:39
past calm is the key to was thought
45:41
which Bentham ice don’t like to talk
45:43
about this has been some great projects
45:45
a project there he wrote millions of
45:47
words much as much of which fortunately
45:48
not been published yet but we had a
45:50
fleet of secretaries very wealthy
45:51
aristocratic so we had employed
45:53
secretaries to take them down copied on
45:55
the note of course Xerox machine or
45:56
typewriter that Ed Park you saw a living
45:59
or abductor absurd on his pouncing I
46:02
live a productive episode on his own for
46:04
you
46:04
to be a Tory the Tory aristocrat he
46:07
converted to democracy actually
46:10
converted by James mill the Tory
46:12
wouldn’t adopt his doctrines
46:13
panopticon’s figured nothing to be worse
46:15
than that maybe a democracy was not my
46:16
pan up pecan perhaps the current ruler
46:19
theory which better mise apologist claim
46:22
only applied to prisons it did not apply
46:23
only to prisons is an excellent brief
46:25
amusing article quite a lot of lip
46:28
service law under the book or Benton the
46:30
Liberty very good scholarly work virtue
46:33
of him alarm usually I’m on my favorite
46:35
people being neoconservative the
46:37
excellent critique of Bentham on the
46:39
haunted house of Jeremy Bentham and her
46:40
work on Victorian Minds panopticon’s was
46:43
skiing not just for the preserve for
46:44
almost everybody for the poor for
46:46
children for vagrants and everybody
46:50
being rounded up his been estimated by
46:52
betterment substance from from a third
46:55
of two thirds of the population being
46:57
incarcerated panopticon’s but you’re
47:00
essentially compulsory concentration
47:01
camps all right with lives with
47:02
scientific those machines just as a
47:04
privacy at all cost-benefit right you
47:06
maximize surveillance and so you have
47:08
one guy sitting in a certain the center
47:10
of a circle and all the prisoners and
47:12
kids and leveraging on buffers or lined
47:15
up so you can see into them and I mean
47:16
quit this before the age of television
47:17
and we’ll laughs bring in bring in
47:20
prophecy of the Overland future even
47:22
though you couldn’t see everybody every
47:23
time nobody would know when you’ve seen
47:24
this everybody would feel he’s under
47:26
surveillance he doesn’t follow the
47:27
utilitarian that’s very important
47:29
everybody feel at all times he’s under
47:30
surveillance by Big Brother okay by the
47:32
panopticon leadership and so this would
47:35
keep him not only keep him on the
47:36
straight and narrow keep them working
47:38
them actually want to get maximum
47:39
production out of them let’s see 12 and
47:40
a half hours a day at for Slade burns
47:42
over and so on
47:43
and everything beautifully worked out
47:45
the idea of course that have maximum
47:46
production by these ready slave labor
47:48
which is essentially what it was an
47:50
optic on my ways week for all seeing
47:51
that’s the controller who sees
47:53
everything
47:53
not likely you know the big brother also
47:56
inspection house was another gonna put
47:59
it this is a big reform Himmelfarb puts
48:02
it very neatly said Bethan wise time
48:03
with an atheist he said she says nothing
48:05
to not believe in God but he did believe
48:06
in a quality that populace sized like in
48:09
Iran the panopticon was a realization of
48:11
the divine ideal spying out the ways of
48:13
the transgressor a potential friend
48:15
rusted by means an ingenious
48:16
architectural scheme
48:18
turning night into day where artificial
48:19
item effectors holding men can play by
48:21
intricate system of inspection the pan
48:24
up the comic-con is omniscient
48:25
omnipotent omnipresent of the inspector
48:28
this is what makes things more most
48:30
efficient for the failings of the
48:32
inspectors the one point Benson
48:36
so there might be some going back to
48:38
adopt my scheme because it might be said
48:39
these people become robots instead of
48:41
people it might be cause he said
48:43
productive of an imbecility for the
48:45
formerly free man with lower than
48:47
indecency fully human and he asked
48:50
himself whether the result is high ROI
48:51
contrivance might not be constructing a
48:53
set of machines out of the similar food
48:54
of men and for this critical question he
48:57
says here’s the utilitarian reply brutal
49:00
boss can you fall down anyway who cares
49:01
ok so they’re just machines the only
49:04
real question is what happy has to be
49:05
most likely to be increased or
49:06
diminished by this discipline was he
49:08
being a scientist that happen it’s
49:09
caffeine it could answer all the
49:11
questions we neatly namely as he said
49:13
there be happy on which by definition
49:14
quantum soldiers called amongst :
49:16
machines he says so there so they’re
49:18
about happy ones I should not care as
49:20
you know passing the core humanitarian
49:23
with a guillotine of the slave pen so
49:25
economy and productivity were but he was
49:27
trying to maximize as he put a
49:30
industries of blessing seven and a half
49:32
hours a day was enough for sleep an hour
49:33
and a half total from me over some time
49:35
I working force labor regime he the the
49:38
punchline is wholesale panopticon schema
49:40
that he would run at some was it would
49:41
be a private property privately owned
49:43
panopticon’s
49:44
giant panopticon’s slave labor would be
49:46
owned by him he meant them get extract
49:49
the profits in the slave laborers and
49:51
this way we have a human read private
49:53
and public institutions and so he tried
49:58
abroad be in Parma Lobby the court and
50:00
never get it through fortunately for
50:01
break Britt Bentham had us a group of
50:04
secretaries it was interesting secretary
50:06
was James Mel and when out of turn when
50:10
a sense was the founder of the Ricardian
50:12
system I really think more and more we
50:13
find out by Mel I think the fascinating
50:15
character not Jon Stewart not a roomful
50:17
but James Miller or father James Mike I
50:21
call him the radicals went on a real
50:22
cadre type real book civic type and
50:24
resent personally ideologically whatever
50:26
although he was something a libertarian
50:28
he basically had this kind of
50:30
mindset I say he was originally a
50:32
Scottish Presbyterian minister comes to
50:36
London makes a precarious living as a
50:38
freelance writer which is always
50:39
precarious and Blanche is on the Bentham
50:42
that’s a lot of money and writing a lot
50:44
of time becomes a second assistant kind
50:46
of he always try to organize everybody
50:47
the cadre Pike person organizing is kid
50:50
Johnson everybody’s friends wife
50:52
everybody being organized and a cadre
50:55
man oh she’s not organized Bentham
50:56
Bennett was really unsystematic would
50:58
scribble all night or whatever and keeps
50:59
playing Bentham once your work on this
51:01
complete this book and then we get you
51:02
the next book better than riding with
51:04
friends this young whippersnapper or
51:05
trying to organize me so let’s sort of
51:07
cultural couple much cash of temperament
51:09
it was it was meh or talk better than to
51:12
be a Democrat that smell our own reasons
51:14
for being favorite Universal stuff
51:16
democracy universal suffrage he adopted
51:18
method of utilitarianism and believing
51:20
lays a fair much more than Bentham at
51:22
this point betsie he felt that he was a
51:24
true Benthamite James Nasir a creative
51:27
thinker one of the most creative
51:28
thinkers this whole modern period but
51:31
always pretended a contract of Smith on
51:32
a lot of other people he originator of
51:34
any kind known just a number to mount a
51:35
faithful men for my birthday for
51:36
accordion
51:37
I’m just a mouthpiece of a great mess in
51:39
the great Ricardo writes actually he was
51:40
contributing much for the doctrine I was
51:43
one of the few people history for under
51:44
the plate his own role I was talking in
51:47
my final analogy about this and one like
51:48
what Bosley but is the it’s about a
51:51
strange he said well make my might be
51:52
any cannot make explanation of us which
51:53
I I’m usually I’m quickly the cousin
51:55
quite I wasn’t quick enough on a mark
51:58
you can on the explanation being a mill
52:00
is impoverished beyond freelance writer
52:02
was Benton was very wealthy and Ricardo
52:04
is very wealthy and so this put
52:07
attention to me and number humble number
52:08
two men might have an economic personal
52:10
economic financial motives
52:12
yes master is a source of a lot of
52:15
Patriot Frank let them kept metal going
52:17
for many years until Moe growth history
52:19
British India Shrieve India anyway he
52:22
does the same thing with a recorder he
52:23
finds record over the papaya stockbroker
52:25
really blonde dealer or what it was
52:27
Ricardo’s home issues the retirement um
52:29
a country squire forgetting a young
52:31
retired person and no keep snogging him
52:34
no no your got to be the great economist
52:35
they keeps quote forcing unquote or
52:37
Carter will write this book and keeps
52:40
correcting every chapter is every
52:41
chapter of card gives the mail medical
52:43
and add stuff to it Gordon thing
52:45
rewrites it and gets them to publish and
52:48
they say okay now you got to be our
52:49
contrary leader in Parliament of the
52:51
philosophical radicals mental organize
52:53
the photographic radical cadre and
52:55
Palmer had about 20 or 30 MPs of 1830s
52:57
which was had a balance of power
52:59
position quite powerful and it turns out
53:02
more and more that merely originated
53:05
much of their Corian system for example
53:07
one of the few good things in recording
53:09
systems are all comparative advantage
53:10
you know that the international trade
53:13
you don’t have to have you can have even
53:14
if one country or one person of course
53:16
is terrible and everything’s
53:18
unproductive almost everything it’s
53:19
still the advantage of trade weather
53:20
because if the imagine everybody’s the
53:22
country in a least unproductive area and
53:25
trade with somebody else’s Consulate’s
53:26
the most productive area so you don’t
53:28
have to be an absolute advantage in
53:29
anything if you just have a comparative
53:30
advantage
53:31
Macario turns out that not acknowledging
53:33
the originator James mill originator
53:35
then forced Ricardo to put an end
53:36
because the car wasn’t interested in it
53:38
Ricardo high only one interest in life
53:40
thinly crushed a landlord landlord
53:41
unproductive landlord class since he
53:45
believed that the landlords were
53:47
unproductive wait and rent will
53:49
inexorably increase and messing
53:51
everything up he kind of postpone the
53:53
inevitable by lowering rent and the way
53:55
to lower less was import weak corner the
53:57
Cola the import week at least for a few
54:01
years you’ll keep down a rental value
54:03
and lower the price of wheat and keep
54:06
the economy going totally until the
54:07
whole thing cracks so so Ricardo’s only
54:10
interest of free title women with the
54:11
lower the price worth of free trade an
54:12
importation a week and because of this
54:14
rent Theory metal had much grosser
54:16
accordion that says they also have a
54:17
general free-trade Arab position plus a
54:20
comparative advantage which apparently
54:22
he lately put into the Ricardo’s book
54:23
which stands out like a sore thumb like
54:25
a page or two pages which a quarter
54:27
never referred to anyplace else
54:28
Ricardo’s relentless is a monetary
54:30
theory of course money in banking which
54:32
I don’t got time to go into and the rest
54:35
of that might rob them we don’t know
54:37
really how much Mills contributes motive
54:38
had endless correspondence endless walks
54:40
with Ricardo giving him the line and we
54:42
don’t really know how much must stop
54:44
with James none and Ricardo several
54:46
games no changed my life all assert them
54:47
Gainesville is a fantastic very
54:48
charismatic figure change everybody’s
54:50
life was around him and so forth and so
54:52
on and
54:52
so much of it might be the million
54:54
system an interesting thing about Mel is
54:57
like is the fact he was even better one
54:59
of the inventor the libertarian class
55:00
analysis class conflict theory before
55:03
the Saints ammonia pnes about the same
55:05
time as Compton Benway I’m not sure it
55:07
was first I’m not sure it was
55:08
independent on most part whether you
55:09
learned it from say Charles compass JB
55:13
say some in law and libertarian analysts
55:17
they were much more sophisticated and
55:19
there had a historical approach which
55:21
milder than has I’ve presumably probably
55:22
got up from them basically libertarian
55:25
class complan Alice’s says cut fasted
55:27
marks which were we’re capitalists and
55:29
workers on an extra bowl class conflict
55:31
the only class conflate comes from the
55:33
stake in other words the state exists
55:34
and that’s something that’s already is a
55:36
ruling class and ruled class right away
55:38
taxation tax consumers and taxpayers the
55:41
people get benefits from the state that
55:42
people lose by the state that creates
55:44
class conflict now everything else on
55:46
the free market is harmony cars complet
55:48
about through the state so company I
55:50
have this and they said well
55:52
industrialism requires motorization
55:54
requires free markets or free trade as
55:55
its state with us away class company
55:58
will be eliminate will have a classless
55:59
society not in the sense of a communist
56:00
assignments that’s a free market that
56:02
was the company approach well mental had
56:04
something similar except was more was
56:06
more narrower basically no said there
56:09
are two classes of society the rule the
56:11
ruling few and the rule many there is a
56:13
ruling class blue in class is exploiting
56:16
the public through taxes and controls
56:18
etcetera and I stress I’m glad was
56:21
eliminated have pure free will a fair
56:23
the reason why was a favored democracies
56:26
he felt that if you have pure democracy
56:27
universal suffrage the public can’t
56:30
exploit themselves as though as a
56:31
minority therefore the public will guard
56:33
against the emerges a ruling class of
56:35
course we now know is a incorrect fury
56:37
made a certain amount of sense in that
56:39
period before democracy was tried but
56:42
any rate that was his objective he
56:44
convinces Bentham you don’t go along
56:46
close because this is nothing that’s an
56:48
idea which it really wasn’t and then he
56:50
starts cognate activity in that
56:52
direction for pure democracy and lays a
56:54
fair he thought the monkey more
56:56
importantly a fair because obviously the
56:58
key thing to have universal suffrage
56:59
then we were here would flow from an
57:02
inexorably he then arranged his
57:04
followers on a cadre base
57:05
using example organized deception it’s a
57:08
very good book Joseph hamburger very
57:11
good books on James mill one is called
57:14
Jon Stewart melon and the intellectuals
57:16
which really about James Mel mostly that
57:19
is called the art of James known the art
57:20
of revolution but he shows was James non
57:25
edition he gave no look books and dark
57:27
with all the time what books unpacking
57:28
everything every book on logic book on
57:29
psychology book on utilitarianism and
57:31
economics books on everything plus
57:33
journal articles course organizing it’s
57:35
friends kid and life and plus all right
57:39
here at cadre in Parliament I mean I
57:40
don’t know how the hell he did it
57:41
unbelievable he also organized number
57:43
from campaign of 1832 Reform Bill first
57:47
open separation middle class in England
57:49
which to him was a way station on the
57:50
road the universal suffrage he really
57:52
pushed it through by an organized
57:53
campaign of cadre deceit in other words
57:55
he got control of the most of the press
57:57
by various means of the most of top
57:59
newspapers he got them to lie about the
58:01
idea of the revolution out there the own
58:03
path to reform though the masses were
58:05
vocal with pure fiction
58:06
no no revolution no nothing he got the
58:09
right government he steer the lid
58:10
government as a thinking it would be a
58:12
revolution they didn’t pass the bill he
58:14
see awesomeeee worked out a theory about
58:15
why lying is good first of all some
58:17
people deserve the truth
58:18
and secondly that person politically
58:21
they’re not necessarily deserve the
58:22
truth and this is lying in a higher
58:23
utilitarian good anyway he did this and
58:27
they were successful only discover about
58:28
ten years later was his age accomplished
58:31
chief age on roadblock or the history of
58:32
a reform bill and I was put through and
58:35
I hope Conway with the vote of the melt
58:36
I figured he’s the guy and they take
58:39
orders from a long time but separate
58:40
separate and the reason why he
58:42
brainwashes kid and something very
58:44
famous thing with John Stuart Mill gets
58:46
brainwashed learning Latin at the age of
58:48
two days or whatever was the reason he
58:51
didn’t do it just for hire but isn’t
58:53
doing whether they try out his theories
58:56
with education on this kid he did it
58:57
because the kid were supposed to be his
58:58
successors cadre leader the kid had a
59:00
lower esophageal area for leadership
59:02
Alejandra I was just an ordinary kid
59:04
that was the basis of course he flopped
59:06
I mean he actually John Stewart was a
59:08
cadre leader until the old man died dr.
59:11
Ludmilla lived them deception comas not
59:13
lay medal headed John Stewart also
59:15
engaging Fogle was seated along with our
59:18
old
59:18
for example he he literally run an
59:20
article praising Bentham this is wild
59:22
father still alive I’m meant to my
59:24
praising about the money of publicly in
59:25
the same time running an anonymous
59:27
article attacking Bentham Mike I mean
59:29
society’s is messed up where I really
59:33
just goes of Highgate with no more a
59:35
cadre leader until father died I was
59:36
about eight years later or something
59:38
anyway what happens Ricardian ISM I
59:40
think again it’s a very difficult fourth
59:42
row understand what Ricardo’s talking
59:44
Ricardo is understand what Ricardo was
59:45
talking back those Ricardo and GB say
59:48
we’re trying to understand Smith’s this
59:49
is very confusing as I said about three
59:51
or four different theories or value at
59:52
the same time using words and obscure
59:55
manner and so forth and so on but cut it
59:56
said well this is a great we know
59:58
that’s a great but we know what the hell
59:59
he’s saying so they’re trying to
60:01
systematize Smith say does it as a
60:05
realtor go decide board really not a
60:07
smithy and and say his whole book I
60:09
recommend by like sage treatise some
60:11
totally cons a marvelous book it’s still
60:13
in the early 1860s or something right
60:15
school give the translation making
60:17
twenty one or something and at the
60:18
marvelous book it’s straight towards all
60:20
its entrepreneurs Kiki marginal
60:22
productivity not marginal productivity
60:24
explanation factor prices their charity
60:27
theories they’re entrepreneurs are
60:28
they’re very heavily the whole thing is
60:29
a Torgo lien book it’s not a smithy
60:31
notes s Smither the greatest the only
60:33
thing smithy and is what picked up from
60:35
Toro namely saving in the sales law is
60:37
essentially the old Torgo think of
60:39
saving and saving is okay the results on
60:41
the best no problem at overproduction
60:42
and or lap it’s really to available
60:45
which Smith gets and it’s a gets from
60:47
Smith or two ago and Smither those are
60:49
the classical liberal libertarian leader
60:51
of a movement in addition of being a
60:53
economist of note addition that say was
60:55
very hard corn banking 100% banking gold
60:58
theorists and all the people Compton’s
61:00
in the land bass they are all these
61:01
people essentially say in the same
61:03
movement all disciples the Simmons JB
61:06
say the more and more awesome almost but
61:09
great scoffs the only great Dorian bad
61:10
about it thinks of Smith originally says
61:12
of Smith originator I can’t believe we
61:13
really meant it now me Tom Ricardo is
61:15
writing I can only score global
61:17
mathematics the only thing worse than
61:19
mathematics is verbal mathematics and
61:21
was with a style you’re writing
61:22
mathematical equations in linguistic
61:24
form so the whole thing becomes it’s an
61:27
equilibrium analysis which is where
61:29
you’re trying to set something be
61:30
constant other things variable
61:31
by putting it in words and which makes
61:33
it almost incomprehensible there’s a
61:35
theory of rent not only says the
61:37
landlord server are unproductive it also
61:39
says that rent is not really part of
61:42
course because rent this differential I
61:44
mean the differential method that the
61:47
poorest land is a zero picked earned
61:49
zero rent and therefore any rent is
61:51
really just the differential it’s not
61:53
really earned for the speak so she could
61:55
say the same thing about wages wages are
61:57
not part of course because over anything
61:59
above unsecured labor none becomes a
62:00
differential should be taxed away
62:02
wherever Ricardo leads directly not
62:04
himself but his followers
62:06
Henry Jordans a straight McCarty Marx is
62:08
recording a labor theory of value which
62:11
which Ricardo listed from Smith there
62:13
was required system of high Smith by
62:15
thinking the worst stuff and some method
62:16
making a system out of it and say
62:18
systematize my taking the best stuff and
62:20
so that’s I think the difference the
62:22
early agree Santa Carla saves law ok
62:24
again Ricardo’s in the same core of
62:26
Smith tradition the thing that happens
62:28
to a card Oh whole system labor theory
62:31
of value here we’ve rented cetera again
62:33
as a mist which you probably all
62:35
unsuitable read namely the Ricardian ISM
62:37
dominated English economics and told
62:39
reven coal 1873 and 1880s and Marshall
62:41
not true we now know the riccati ISM
62:44
died out by about 1830 and where he died
62:46
of 1822 in six or seven years recording
62:49
them have been smashed by all sorts of
62:51
people my utility theorists like Samuel
62:54
Billy by anti when people like Thompson
62:57
anti Carney read theory and so by 1830
62:59
called tongs we were dressing the
63:01
political economy cover so nobody’s
63:03
recording anymore hominy here the
63:04
recording system as this is finished and
63:07
so we had a whole bunch of things going
63:08
on very interesting stuff the Irish
63:10
theorists the Trinity College Dublin had
63:13
a whole bunch of utility theorists
63:14
objectively Toby Farris for excellent
63:16
put a microchip whateley
63:18
River interesting character and the
63:20
English and gets a was a professor at
63:24
Oxford a master of oriel college
63:26
fighting the fight against the high
63:28
churchmen a Knoxville hi Tory he was
63:30
working with a latitudinarian type and
63:32
when he gets think it becomes Archbishop
63:34
of Lublin immediately sets off a wait
63:36
laid chair politically economy and puts
63:38
in the rest of his life selects the
63:40
whole is above everyone on the utility
63:42
theorist until he until he dies
63:45
it carries on won’t feel and button all
63:47
these people because I sort of outside
63:49
English mainstream even Englishmen don’t
63:51
care what’s going on in Ireland so it’s
63:52
not bad at fluent your butt’s going all
63:53
adding the whole thing up mass or a
63:55
senior having some excellent stuff so
63:57
senior very anti recording some of that
63:59
explicitly Sicily saying it and of
64:02
course again something should going to
64:03
having other times the Malthusian thing
64:05
which comes from Smith Malthus gets his
64:08
anti population stuff for some Smith the
64:10
iron lower wages and or ladders really
64:12
it’s really derived from the core of
64:14
course is a big mouth Uzi in on
64:16
population on other things and senior
64:19
essentially smashes that without saying
64:20
so and essentially demolishes it’s
64:23
strange about Malthus violent here’s a
64:24
guy growing up after 50 years of
64:26
Industrial Revolution explosion of
64:28
fantastic food standard of living and
64:30
worrying about population increase for a
64:32
much more apropos one hundred years
64:35
before when nobody was a Malthusian bad
64:37
he waits so to speak the Malthusian
64:40
problem was overrun and sets it up for
64:42
the real problem the popular big problem
64:43
population pressure so what happens is
64:46
basically Matthews Riccardi ISM was
64:48
finished until John Stuart Mill
64:50
resurrects a monstrous work of 1848 and
64:53
was making 23 1848 with no record Ian
64:57
nomination English economically free
64:59
flow of our utility theorists that were
65:01
anti Oni rent theorists etc there’s one
65:04
great arresting character must um I
65:05
can’t home it on this thing a
65:07
fascinating character in John Ray who
65:09
was a Scotsman and one person bum bother
65:12
does acknowledged as being pre bum over
65:14
Qian pre time preference pre capital
65:16
Austin capital theorists and it’s very
65:19
strange duck he’s a Scottish position
65:21
instead of unemployed and doesn’t do
65:24
well he has a marital problem anyway
65:25
leave Scotland for Canada and he’ll a
65:28
contentious character anyway he gets
65:29
involved in Canadian Calvinist politics
65:32
for cleanup again now which faction II
65:34
was then anyway he’s in the losing
65:35
faction Haley regime
65:36
especially kicked out of Canada and
65:38
leaves for I feel of Hawaii I think
65:41
probably Hawaii some minor Hawaiian ion
65:44
I stay there person’s life is a village
65:46
physician and when he writes this thing
65:48
he’s passionate life of geography he
65:50
worked with the Senate of working on
65:52
Canadian Canadian geography geology in a
65:54
lot and he might he’s a big protection
65:56
of super protection protective Carboni
65:58
hate down
65:58
Smith she writes a book in the 1840s
66:02
designed to attack Adam Smith and free
66:05
trade and he says Wow boy talk about
66:08
free protection I have to deal with
66:09
capital theory works out a whole
66:11
Austrian capital theory and no
66:12
relationship with free trade whatsoever
66:14
of protection works out of has a
66:16
fantastic saying what’s this whole thing
66:17
out he publishes the publisher was a New
66:20
England protectionist publishers in one
66:22
of their good firm anti Jacksonian fi
66:24
free trade book he publishes this book
66:26
nobody understand he’s talking about and
66:28
so she just has nothing else there’s
66:30
nothing about protection relays
66:31
worthless and so nobody reads it the guy
66:33
disappeared goes to Hawaii or something
66:35
and anyway jumps through ammo reddit
66:37
because he well almost everything anyway
66:39
and somebody showed it to him he we can
66:41
she just was a good book and he praises
66:42
the rape robbery but for the wrong
66:44
reason he doesn’t understand it too well
66:45
it doesn’t get the pre-bump barbaric
66:47
stuff at all the appraisal in poor poor
66:50
ray gets a clipping I think from mill
66:52
you know this is many years after the
66:54
book was written so gene so thank you
66:56
mr. Nolan Kristen the only person ever
66:57
talk about my booking and like get kind
66:59
of aesthetic poor guys with your writing
67:00
in the Hawaii Village position that was
67:03
let nobody referred to it until about
67:04
1900 when Mixter T director discovered
67:08
it and Bob Wallace say your writing I’m
67:09
already either and then praised it so
67:12
anyway he’s a very very interesting
67:13
character so real this was going on and
67:16
there’s book comes in and reestablishes
67:18
Ricardo McCartney doesn’t a mill had
67:19
such tremendous prestige by this time as
67:22
a philosopher logician intellectual and
67:24
separate cetera everybody just spoke for
67:26
it so couple over and adapted this and
67:29
the whole utility stuff drops out nan
67:32
McCrory men Theory drops now the whole
67:33
thing is sort of caves in know becomes
67:35
gamma J s from 1848 intro or 1880s let’s
67:40
say so that’s that’s really the dominant
67:41
since the resurgence of recording has
67:43
also in addition to that mill
67:45
establishes positivism as a
67:47
self-conscious methodology for the first
67:49
time the previous classical economists
67:51
say was explicitly if we call our proxy
67:54
ologist deductive we start with
67:55
self-evident axioms in the u s–
67:57
economic theory senior is definitely a
68:00
self-conscious proxy ologist and record
68:03
i mimosa no no no parts of the idea of
68:05
false assumption of friedman night
68:06
pretreatment i view it you have to have
68:08
false assumptions which you then
68:09
reducing and test on wants or thought it
68:11
really begins with
68:12
with no and they’re having great
68:14
prestige which the other squirt didn’t
68:15
have essentially wins out and that’s and
68:19
of course without offered Marshall was
68:22
sort of the same thing with marketing
68:23
utility theory margin utility theory
68:24
comes in 1877 in England and Mara on
68:28
Switzerland and Manor in Austria
68:30
marshals function in life with the very
68:32
very margin utility theory with faint
68:35
praise with the reestablishment Ricardo
68:36
and Mel it was his whole goal in life
68:38
and unfortunately succeeded in Britain I
68:40
was growing I went to college I read
68:42
marshals principles of economics
68:44
straight through that was our summer we
68:45
had a seminar we did read Marshalls
68:48
Fiddler’s is great much better than
68:49
reading in our canes or something that
68:50
was that was what we did first of all we
68:53
read Marshall you see ever
68:55
evangelicalism you see the pietism
68:57
shining through custody making – moral
69:00
arguments clear out in the midst of
69:02
talking about the representative firm
69:03
and all that but more important here is
69:05
that when he doing Lee takes margin
69:07
kirlyam and he trivializes it then with
69:09
Caen finds it to consumption okay it’s
69:13
true about assumption yet the margin
69:14
diminishing margin told me that’s it
69:15
true they saw the value of paradox then
69:17
and from then on he talks about
69:19
production equals not cost of course is
69:21
the key thing and so the real essence of
69:23
utility Theory drops out since when I
69:25
was going to graduate school or college
69:27
in the forties the general review of the
69:29
marginal has integrated anything of
69:30
value in the Austrians that was let go
69:32
and wash any good stuff as a marginal
69:34
versus buff doesn’t have to be read the
69:36
view here is that my Marshalls famous
69:40
phrase value is to determine by scissors
69:43
scissors of supplying a man you have the
69:45
demand scissors point America you have
69:48
the rising supply curve which is the
69:50
cross determined by cost allegedly and
69:53
these two so determine market price
69:55
however this really starts with Smith
69:57
file and course Ricardo emphasizes key
70:00
thing is not markup right who cares
70:01
about marked by markup are key thing is
70:02
wearing one normal pricing and with
70:04
equilibrium prices you’ve never get any
70:07
way that’s more much more important and
70:09
more unnormal Marshall claimed the
70:12
supply blow that a cross played this
70:15
triumphant the man sort of drops out and
70:17
the really important part of the
70:18
scissors the important blade is cost
70:20
objective course determined by labor
70:22
disutility and whatever so what he does
70:25
is he
70:26
I got sophisticated version of Ricardian
70:28
ISM we don’t worry about market price
70:30
you worry about long-run cost and of
70:33
course one of the two basic problems one
70:36
is the only one course never arrived so
70:38
it can’t be really the key sample or key
70:39
thing you want explaining the market we
70:41
will market and not more than one
70:43
whichever shows up and secondly is that
70:45
what do you do about the good that have
70:48
no cost
70:49
Rembrandt’s for example Rembrandt
70:51
painted the thing and then corked off
70:53
okay the place of Rembrandt’s fluctuates
70:55
where the supply cost where’s the supply
70:58
violet light ain’t there of course the
70:59
only demand they had to a midwife
71:01
doesn’t work for a non reproduce herbal
71:02
product small apple open all of this is
71:04
important that’s part of pricing too
71:06
isn’t it better to have a price theory
71:08
we have a general explanation world
71:09
prices and one which only explained what
71:11
producible Goods and so that of course
71:14
it’s not discussed of the non revolution
71:16
of course goods were just toss them and
71:18
waste basket along with consumption with
71:20
ricardo whether it’s his rug bag of the
71:22
same very sophisticated manner and
71:24
marshall i’m a tremendous prestige of
71:25
the Cambridge professor nominates Old
71:28
English economics from 1880 to 1920 and
71:33
Jevons were sort of a maverick semi
71:36
Austrian so to speak maverick doesn’t
71:38
get any any hearing and dies young to
71:41
pull against his influence which added
71:44
the reestablishment Ricardian ISM then
71:46
with mill and and Marshall being
71:48
potentially and more sophisticated form
71:51
that there that was really effect that
71:54
really ushers in the 20th century

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