 So the morality of capitalism, I thought we'd start with kind of a little bit of a discussion about what capitalism is. Because I find that as I travel around the world, and this is country six on my current trip, I started in South America, that people don't really have a grasp of what capitalism actually is. They associate capitalism with what we have today, maybe not in Georgia or maybe not in a particular country they tend to live in, but they kind of look at America or something and they say, yeah, that's capitalism. But it isn't. So let's start with what capitalism is. What is it that I'm going to defend from a moral perspective? So in my view, capitalism is the idea of free markets, free of what? Free of? Free of coercion, free of force, free of government regulations, free of government control, free of government intervention, period. Under capitalism there is a complete separation of state from economics. Capitalism, under capitalism the role of government is limited to the protection of individual rights in the context of economics, if you will, the protection of property rights, where all property is privately owned. So in that sense, in that pure sense of what capitalism is, we've never had capitalism. Capitalism is still an ideal, like one of Ayn Rand's books, Capitalism, Not Knowing Ideal. It's an ideal that is still unknown in the sense that we've never really completely practiced it. By the way, that book, Capitalism, The Unknown Ideal, is coming out in Georgian. I think the first copies are going to be available tomorrow. So you know, in the coming weeks you should be able to find Capitalism, Not Knowing Ideal by Ayn Rand, available in Georgian at the Bookstores. And I highly recommend it. A brilliant, brilliant book. So Capitalism is the system of really free markets. And we've never seen it. But what have we seen? We've seen that everywhere in the world where it is tried, where elements of Capitalism are tried, where some free markets are tried, where some respect for private property is tried. Those places dwell to the extent that they practice Capitalism. The more respect for property rights, the more consistent, the more the rule of law, the more freedom individuals have, the more successful societies become. Now, what do I mean by success? I mean, richer. I mean, fewer people in poverty. I mean, people living free, healthy, long, successful lives, or having the opportunity, at least, to do so. The more capitalist, the higher the GDP per capita, the more capitalist, generally the longer the life, it works. Capitalism works. And indeed, the opposite is also true. The less free markets, the more we regulate, control, introduce coercion into the economic system, the poorer people are, the worse off people are, the fewer opportunities they have. So there's a direct correlation between how much freedom we allow in a society from an economic sense and economic well-being. And we have hundreds of examples of this all over the world. It doesn't matter what continent you're on. It doesn't matter what ethnic group you have. It doesn't matter how rich the country used to be, or whether it has natural resources, or doesn't have natural resources. None of those things matter. All that matters. The only factor that seems to matter is the extent to which you allow for freedom. I mean, take a place like Hong Kong, which is a rock, an island, in the middle of nowhere. 75, 100 years ago, there was nothing there. A fishing village. In general, in the area, a few tens of thousands of people lived there. They were poor. They had nothing. There's no natural resources in Hong Kong. There's nothing. And about 75 years ago, or 100 years ago, the British came, and all they did was establish the rule of law, protection of property rights, protection of contracts, and nothing else. No real safety net, no socialized health care. Just if you went there, you had the opportunity to build something, create something, and keep it for yourself. Very low taxes, almost no government intervention. What happened to this sleepy little place in the middle of nowhere that the Chinese didn't even want? They basically gave it to the British for 100 years because it was insignificant. It didn't mean anything. Well, over the last 75 years, Hong Kong grew from tens of thousands of people to seven and a half million. And it grew to seven and a half million, not because people had lots of kids, but because massive numbers of immigrants came to this place. They came from all over Asia. They risked their lives to come there. Why? I mean, the rest of Asia was dominated by socialism. You'd think they'd all want to stay. Right? It's because they were good, poor. They had no opportunities. They were being oppressed by their governments. And here was an island, a little, tiny little island of freedom, of opportunity, a place where they could make something of their own, where they would be left free. Today, Hong Kong has more skyscrapers than New York City and a much smaller place. It's magnificent. I always tell people, anybody here being Hong Kong? All right, two. Everybody should go to Hong Kong once in their lives. You've got to see this place. It's stunning. It just is stunning. And the rich by GDP per capita, average GDP per capita in Hong Kong is higher than average GDP per capita in the United States of America. In a sense, they have created more wealth in 75 years than Americans created over 250 years, all because they were left alone, free, little regulations, little controls, no coercion. The government basically acted as a police force and as a court system and left everybody alone. They don't even have a central bank. They use, basically they use dollars. So everywhere you go, you see this, right? Maybe one of the most striking examples right now about this difference between capitalism and socialism is in South America because you see it, it's very stark. There are two countries in South America that are truly amazing, right? One is, it's a country that 30 years ago was the poorest country in all of Latin America, all of South America. Sorry, 30 years ago was the richest country in all of South America. We'll start with the rich one. 30 years ago, richest country in South America, had fertile land, was exporting food, has, this country still has, the largest oil reserves in the world. They have more oil in the ground than Saudi Arabia. It's not the best oil. It's a little expensive to produce. Saudi Arabia is really easy to produce and very high quality, but still they have more oil than Saudi Arabia. And 30 years ago, they were the richest country in all of Latin America on a per capita basis. So individuals in this country were relatively well off. Today, it's the poorest country in Latin America. It's so poor today that people are starving in the streets. There are no cats and dogs in Caracas. There are no pets. You know why? Because they've eaten them because they're so hungry. They broke into the zoos. They've eaten the animals in the zoos. Now they go through the trash. Kids, middle class kids don't have food to eat. Millions of them are leaving and going to the neighboring country of Colombia. Now this country is Venezuela. And the reason it went from being the richest country in Latin America to the poorest country in Latin America is because it adopted 30 years ago and slowly gotten worse socialist policies. They started by taking private farms and collectivizing them. Everywhere in the world, from Ukraine to Russia to China to Venezuela, when you collectivize farms, all you do is bring about starvation. Collectivizing farms destroys food production. You'd think we would have learned after 20 or so million died in Ukraine, 60 million died in China, and now thousands, maybe tens of thousands, maybe hundreds of thousands, we don't know the numbers, are dying in Venezuela. But no, they tried it again. They collectivized every or socialized every aspect of the oil industry. Not just the oil producer, but the entire supply chain was nationalized. Guess what happened? They can't produce any oil. They don't have the technology. They don't have the capital. They don't know what to do with it. Most of the profits from the oil are being stolen by bureaucrats and army officers and on Swiss bank accounts. Socialism, everywhere it's tried, no matter when it's tried, leads only to starvation and poverty and usually to mass murder. That's the history and Venezuela is a great example of it. Now what makes Venezuela striking is that right next door there's another country, and this country 30 years ago was the poorest country in Latin America, and today it's the richest country in Latin America. So one went like this and the other one went like that. And what did the one that got rich do? They privatized, they deregulated, they eliminated taxes, they even privatized their social security. Their pension plan is 100% private today. But you know what country that is? Chile. That's Chile, right next door. Capitalism works. If you care about making people rich and if you care about making poor people less poor, richer, if you want to reduce or eliminate poverty, capitalism is the only system ever known by man to do exactly that. What percentage of the population was poor before capitalism, before we had any free markets? 98 is not bad, somewhere between 95 to 98%. Almost everybody was poor. What do I mean by poor? I mean by poor two dollars a day. Two dollars a day, 95 to 90 in equivalent to today's dollars, 95 to 98% of the world's population 250 years ago lived on two dollars a day or less. Even in Georgia living on two dollars a day is really hard, really hard. But 95 to 98% of all people 250 years ago lived on exactly that. Today this place is in Africa, this place is still in Asia where people are still living like that. But we have gone from 95 to 98%. How many people do you think today live on two dollars or less a day? How much? 15? Anybody else? Yeah, you're cheating, you know the answers. He knows all the answers. It's less than 10%, 8%. And 30 years ago it was 30%. So just in the last 30 years over one billion people have come out of extreme poverty. We don't even know about this. This should be the most important news story of our generation. And yet nobody talks about it. And why did they come out of poverty, these billion people? Because of foreign aid? Because of socialism? Because of charity? No. Because in places like India and China and South Korea and Taiwan and many other places around Asia and even in some places in Africa they have adopted elements, just some elements of capitalism. And when you adapt even a little bit of capitalism, boom, people come out of poverty. It's stunning. It's amazing. So you would think that we would be celebrating this. You would think that everybody in the world would be a capitalist. You would think everybody would want to move more in the direction of capitalism, get government out of the way, deregulate lower taxes and make us richer. Because it works. You know if we want to eliminate poverty we should be going and becoming more capitalist. You'd think people care about poor people and therefore everybody would be shouting and clamoring for more freedom. But that's not what happening anywhere in the world. In almost everywhere in the world. We're seeing particularly young people wanting more government intervention, more regulations, more redistribution. There's an inequality problem. We need to take more from the rich and give to the poor as if that ever helped the poor. We need a redistribute. We need to regulate. We need a control. We need to centrally plan all the things that don't work we want to do. And all the things that do work we ignore and we avoid and we run away from and we hate. Now that's weird. It's strange. And it's something we have to deal with. Why do people so hate capitalism? Given that it's worked. Why do people resent? You know doing away with poverty. You'd think everybody would be happy with that. But they don't. They're not. So the question is what's going on? Because in terms of economics the capitalist won 50 years ago. In terms of reality we've won. In terms of history we've won. But somewhere we're losing. Because we're losing the hearts and minds of people. People are not out there in the streets demonstrating for capitalism. They're demonstrating for socialism. They want to be poor I guess. But nobody wants to be poor. So it can't be that. So what is it? Now partially its people don't know history and they don't know economics. So they're just ignorant. But if it was just that it would be easy to fix. But it seems really hard to fix. So let's think about a little deeper about what capitalism is. What are markets about? Why do people go to the marketplace? What is the purpose of entering the marketplace as a buyer or a seller? Why do we go to the marketplace? Why did Steve Jobs, why did he build one of these? Why did Steve Jobs do this? Yeah for money and you laugh. Because it's a little embarrassing to say he did it for money. But he did. You know what the profit margin and these things are? I mean the first one, the first generation had 60% profit margins. If Steve Jobs cared about me he would have sold it a lot cheaper. But he doesn't care about me and you. He wanted to make money. And we feel a little embarrassed by that fact. You all feel it a little bit. But was it just about money? Did Steve Jobs make this only because he wanted to make money? No. Why else? What else motivated him? Purpose. Love. He loved this stuff. He loved the challenge. He loved the technology. He loved the beauty. He wanted to build something in his image. He wanted to do something meaningful, exciting with his life. But at the end of the day who did Steve Jobs build this for? Himself. This is a self interested activity of Steve Jobs. I like to tell the story when I went and bought my first iPhone. It was 2008 and the US economy was kind of descending into recession. And I went to buy my first iPhone because I wanted to help stimulate the US economy. Because I'd read Keynes and Keynes tells us that if we consume a lot we help create economic activity. And I know that's why you go shopping. You'll go shopping because you care about your fellow man. And you want to make sure their jobs. And you want the Georgian economy to grow. No. Why do you go shopping? Why did I buy my first iPhone? Whose life was I trying to make better? My own. I went shopping because I liked the iPhone because I thought it would make me more productive. It turns out I was right. I thought it was cool. I thought it was a beautiful thing. And I wanted to own it for my because I thought it would make my life better. So the marketplace is a place in which we go to do what? To pursue what? Our own interests. We go into the marketplace to pursue our own self-interest. I mean, Adam Smith in the wealth of nations knew this. He wrote in the wealth of nations. The baker doesn't bake the bread because he cares about you. He doesn't know you. He doesn't care. He's making the bread because he's trying to make a living. Hopefully he enjoys making bread. But the main reason is trying to feed his family. He's trying to feed himself. People enter the marketplace to pursue their own self-interest. That is a truth everybody knows and understands even if they don't put it in words. And yet, what have we learned from when we were this big? What did our mothers teach us? What do our priests preach to us? What do our philosophers tell us about self-interest? Is it good or is it bad? It's bad. I mean, I grew up in a good Jewish, you know, with a good Jewish mother and she taught me that self-interest was no good. You should always think of other people first. You should put your interest last. Now no mother means that. They don't actually want you to behave that way because they want you to be successful and to be successful. You can't do that. But they say it because that's what's accepted in our culture as moral. What's accepted in our culture as good and moral is selflessness. Right? Be selfless. Don't be selfish. Be selfless. Don't think of yourself. Sacrifice means giving something up and getting what in return. Nothing or something less valuable to you. When I bought my iPhone, did I sacrifice? Why not? I gave something up, money, but I got something more valuable in return. If I paid $600 for this iPhone, it's because this iPhone is worth more than $600 to me. So I'm better off. So it wasn't a sacrifice. It was a trade. But no, what's really virtuous, what's good, what's noble, what's moral is the sacrifice. It's to be selfless. It's to think of others first. It's to take care of everybody else, not yourself. That is self-interested or selfish. And when we talk about somebody who's self-interested and selfish, do we think about Steve Jobs? Who do we think about when we think about somebody selfish or self-interested? The government. I don't think about that for the government. I wish they were selfish and self-interested. They're self-destructive and they want to destroy everybody else as well. Yeah, rich people. Rich people who do what, though? What kind of behavior do we associate with self-interest and selfishness? Do we get production? Yeah, greedy, but greedy means what? What kind of behavior? Bad. But what does bad mean? What do they do? They lie. They steal. They'll cheat. They'll do anything. They'll exploit you to get their way. That in our mind is what self-interest means. Not trading, not building, creating, making stuff, but exploiting people, destroying people to get their way. So we're offered, in ethics, two alternatives for human behavior. You can be selfless. You can sacrifice. You can live for other people. You can model your life after Mother Teresa. And if you do, you get sainted and you are considered a moral paragon. Nobody actually wants to live that life, but we consider that true nobility, true goodness. Or you can be a lying, stealing, cheating SOB. And those are the two options. And most of us try to navigate our way between this and live our lives and then we succeed and we feel guilty because we want Mother Teresa. Because our mothers taught us that that was the moral ideal. Is it about helping other people? Which is interesting, right? Because this morality tells us to be selfless. It's about sacrificing for others, about making them better off. But is it? Because when I look at the world, who helps most? Who is the biggest beneficiary of mankind? Who makes mankind better off? Who benefits the poor the most? Businessmen. Take somebody like Bill Gates, right? Greedy businessman. It's like the second richest man in the world because another greedy businessman, Jeff Bezos, has beaten him and is now richer than him, right? But Bill Gates made, well, the real reason Bill Gates is not the richest man in the world is what? Because he doesn't work anymore. He doesn't work for a living anymore. We'll get to that. Bill Gates made 70 billion dollars for himself. How? How do you become a billionaire? I'm going to give you the secret of being a billionaire so you can all become billionaires. How do you become a billionaire? What's the secret? Make something that everyone wants. Absolutely. You make something that everyone wants and you have to add this other piece. A willing to pay you for it more than what it costs you to produce. Because if you sell something at a loss, you don't become a billionaire, right? So you make something. Everybody, let's put a number to it. Billions of people want and are willing to pay for it more than what it costs you to produce. Now why are they willing to pay you more than what it costs you to produce? Is this thing that they're going to buy? Is it going to make their life better or worse? Better. Otherwise, they wouldn't give up the money. So if it costs $100, it's because this thing, call it a Microsoft product, is going to make their life better by more than $100. So here Bill Gates goes out, creates Microsoft, sells his products to billions of people, makes the world a better place, improves the lives of billions of people. Billions of people are better off because of Bill Gates. He made the world a better place. Every billionaire in a free market makes the world a better place. You cannot become a billionaire unless that's exactly what you do. How much moral credit does he get for that? Do we think, whoa, Bill Gates, he made the world a better place? What a great guy. Let's build statues for him. Maybe we'll even give him sainthood. Nah, we don't give him any moral credit because he made money. And it's not just that he made money, he made a lot of money. So let's give him a few negative moral credits. So morally, Bill Gates gets no credit for helping other people because he did help himself in the process. And that gives you a lot of indication into the kind of morality we live in. We live in a mall with a moral code that says no. It's not about helping other people. What's it about? It's about sacrificing. So think about when Bill Gates becomes a good guy in the world today. It's when he leaves Microsoft. God forbid you actually build or make or produce something. And he starts giving all his money away. Now he's okay. Now he's a good guy. How many people is he going to help? Not that many hundreds of thousands maybe. Nothing wrong with it. It's fine. But he's not going to help billions. He's not going to change the world. But now he's good because he's not benefiting from it. Now we're still not ready to make him a saint. We're still not building statues for him. We're still not naming streets for him. Why? He's still got a lot of money. He still lives in a nice house. And he seems to be enjoying what he's doing. That's not acceptable. You can't be a moral saint if you're having fun. Have you ever seen a painting of a saint with a smile on their face? No. The whole point of sainthood is that you suffer. The whole point of sacrifice is that you suffer. The whole point of morality, as we're taught it, is that you suffer. How do we make Bill Gates a saint? What's that? No, he's already doing charity. He has to do a lot more than that. He has to give it all away, move into a tent. And if he could bleed a little bit for us, then we'd build statues. None of us would want to be him. But we'd build statues. We'd venerate him. We'd think, wow. And when he died, he'd become a saint. But think about that. That's the world in which we live. We live in a world where building, making, producing, changing the world, making the world a better place through production and trade is eh. Suffering, suffering and giving without expecting anything in return and giving money away, that's good. Now that, in my view, is sick. That's not morally right. That can't be morally just. But think about what that does to our conception of capitalism. If building, producing, making and trading is not morally good, then how can capitalism be good? Under capitalism, what do we do? We engage in self-interested transactions. We build, create, produce and trade. That's the essence of capitalism. Yet all of that is deemed bad morally. It's condemned morally. What's good? Sharing and giving and sacrificing. And what economic system, what political system is good at sharing, giving and sacrificing? Socialism. Socialism is great at sacrificing, particularly if I can sacrifice you guys for those guys over there and they will, you know, help me get, keep getting re-elected. Socialism's all about sacrifice. Socialism's all about suffering. That's why it's nobler than good. We love socialism because it's the only system consistent with our moral beliefs, with our moral code, with this morality of selflessness. So in my view, if we care about prosperity, if we care about wealth, if we care about the poor, if we care about the quality and standard of life for human beings, then we need to rethink our morality. Our moral code is screwed up. Everything we've been taught by our parents, our preachers and our philosophers is wrong. It's inconsistent with human life. It's inconsistent with success. And this is what Ayn Rand does. She sends all of that baggage, all of that morality into the trash heap of history, where it belongs. Because she asks one simple question. Why? Why should I sacrifice? Why is your happiness more important than mine to me? Why are other people's well-being more important than my well-being? Why? Who says I should live for other people? Where does it come from that we should be selfless? An ancient book, some authority, but in logic and reason, how can my life not be the most important thing to me? You've all got a choice. You can live or you can die. That's it. That's the fundamental choice we all face. And if you choose to live, then shouldn't be the question of how to live? How to live the best possible life for you? How to make your life the best life that it can be? How to flourish and succeed as a human being? Shouldn't that be the primary question that you ask yourself every single day? What should I do today to make my life better, to succeed, to flourish? And what would be the primary thing you would go after if you valued your life more than anything else? What's the thing that makes human life possible? What's the thing that creates all the values that we have that surround us? Everything. The desk, the building, the lights. Thinking, your mind, your reason, your capacity to think. So Rand says, if you really want to be self-interested, it's not about lying, stealing, and cheating. You can ask me in the Q&A, none of those are good for you. All of those are inherently self-destructive. If you care about your own life, the one thing you should value, the one thing you should care about is your mind, is your reasoning capabilities. Every day you should think, what do I need to do today to make my life the best that it can be? No criminal ever did that. No crook. No government official. Otherwise they'd quit. It does that. And what would you do if you care about your own life? Well, you'd find something challenging and interesting and thrilling to do. You try to produce and create and build and make stuff. That would be your focus in life. And you would want to surround yourself with productive, rational people. And you'd want to treat them how? How would you relate to other people? Not by exploiting them, or not by allowing them to exploit you, but by trading with them through win-win relationships. Rans, iron rans, ethics is all about creating win-win relationships with other people. Not lose-win, not win-lose, not lose-lose, win-win. Now, if you think about it, isn't that what capitalism is? Capitalism is a system where we deal with one another through win-win relationships, where the producers, the creators, the builders use their mind to make the world a better place. We all benefit from it. But they are living. All of us, hopefully, are living a life based on our own mind, pursuing our own passion, pursuing our own dreams. I mean, to me, Bill Gates is a moral hero. I would love to build a statue for Bill Gates, because he used his life. He made something of it. He used his mind to make the world a better place for me and for you. He's a hero. Put aside everything else that he might think or do in his business life. He is a hero. And I would say any businessman is a hero, because by creating wealth, by making money, he has made his little world a better place. He is taking care of himself and his family. He has used his mind to make his life better. So according to Rand's ethics, rational egoism or rational self-interest or rational selfishness, the purpose of your life is your life. It's to flourish, ultimately, to achieve happiness. To do that, you use your mind, you think, and you produce. You create the values that you need in order to survive. And you trade with other people in win-win relationships. It's exactly what businessmen do. It's exactly what capitalism is all about. To defend capitalism, to change people's attitude towards capitalism, what we really need is not more economics, although there's no harm in that. There's not even more history, although again, no harm in that. What we really need is a moral revolution. What we need is to replace the morality of sacrifice and selflessness with a morality of trading and self-interest. A morality that venerates the individual, where the individual is what's important, where each one of us live for our own sake. We will not be able to defend capitalism unless we're willing to adopt a new morality, to challenge the morality of old. At the end of the day, if you are striving to make your life better off, the last thing in the world is a little mother government sitting on your shoulder telling you don't eat that, or don't drink that, or you know, too much soul to whatever. It's none of their business. It's my life, not theirs. I want to use my mind, my thinking, my time, my resources to decide on what my value should be and how I should pursue them. And as long as I'm doing that rationally and as long as I'm not hurting other people, why is it anybody else's business? It's nobody's business. That's what capitalism needs. That's what a moral defense of capitalism is. A moral defense of capitalism is a moral defense of self-interest. It's a moral defense of individualism. It's a moral defense of the right of every individual to use his mind to make decisions for himself. It's a morality of self-interest. And again, if we adopt such a morality, capitalism will take care of itself. There wouldn't be any socialists in a world like that. Nobody would let them get away with it. So I encourage you all to think, think about an alternative to what everybody's taught you, to what everybody's considered, to what the philosophers, the preachers, and the mothers of the world have taught us. We need desperately a moral revolution in this country and everywhere in the world. We need to save capitalism and we can only do that by establishing a proper moral foundation for it. Thank you all.