 The rigors start with the question. We didn't get to hear from you in our last session. So I hate boring conferences, and I can say this is certainly not a boring conference. I appreciate being part of this conversation. In response to my colleague, I must say I also agree on the importance of history. I think it's very important to talk about the sort of historical details, the sort of historical processes. In terms of the conversation, that ideas in rich history, that's of course an older conversation between Karl Marx on the one hand, and Hegel on the other hand to argue to the ideas piece. Now in both cases, of course, you have to account for the fact that ideas are never isolated. And ideas do not come from outer space. Like you said, they're not just coming from brains either. They come from real life. And that was Marx and Hegel's argument. So then we need to talk about ideas where they come from, who benefits and who doesn't. I agree. I'm worried about the history, the way you tell it, though, because it seems to be leaving out some of the key players. First of all, when you talk about the bourgeoisie, you translate the French term into middle class. The reality is that the bourgeoisie at some point, of course, is the middle class in the ancient, the ancient regime where you have still princes and a ruling class and so on. In our society, of course, the bourgeoisie has become the ruling class, and that needs to be discussed. That's not a disparaging term, but not to talk about a ruling class today, I think, is leaving a big hole in terms of talking about economics. Then to assume that it is the government that's basically accumulating the most profit, that would be hard to argue in the United States where the government, of course, is in deep debt, while at the same time, the wealth of certain individuals is growing. What we have to say, these are numbers. 60 individuals, or 62 between 60 and 70 individuals today, own as much wealth as half of the world's population. About 10, 15 years ago, it was still 300 people plus who owned half of the world's wealth. Now that number is smaller. So what we need to talk about, I would suggest, and I would like to welcome your comments on it, what do we do? How do we talk about the ruling class? How do we talk about the top? How do we talk about what's happening above the middle class? That's also a question for John List, in terms of education. If we simply measure the American standard and we want to live up to that, that's one thing. But there are things happening at the top where we have the top educational systems in the world, where we have the brightest students, the greatest research done. That's way above anything that we're usually discussing. So first question, how do we talk about what's happening at the top and who benefits from that? My second question is. No wait, maybe we better do it one by one, because I'm going to forget what you said. Would you like me to forget what you said or answer? I'm sorry. I'll just briefly answer it. The calculation you talk about is the Oxfam calculation. Oxfam is an English charity. And they point out, which is accurate, that in terms of assets, financial assets, ignoring human capital, by the way, which is the most important source of income in wealthy countries. But anyway, in terms of financial assets, this top 30, top 50, top 100, it doesn't much matter what it is, owns more than the bottom half or equal to the bottom half. But that's the wrong calculation. Wealth is not what we need to be interested in. We need to be interested in what I would call, and I keep trying to figure out what word to use for it, but maybe basic consumption or the consumption necessary to have an active role in a democratic society and have a full life. And this means access to medicine and adequate food and have a roof over your head and so forth. And that equality has increased in the world and in every country I can name over the last two centuries, over the last half century, over the last 30 years. So this hysteria, I'd have to call it, about inequality is misplaced. Now you'll hear it on the TV and in the newspaper, inequality, inequality, inequality. That's mistaken. But you're right about me neglecting the ruling class. I'm often accused, and I would have accused myself back in my Marxist days, of ignoring power. The history of class struggle is the history of all the other two existing societies. But I think that a lot of these ideas were arguments within the elite. But I agree that that's a weak part of my argument. I'm not facing up to that enough. So those are your two major points. Now carry on. I mean, the main point about wealth, of course, is not simply the question of who has how much money, but who has the power. How does power flow? I know. That's right. So that is part of that conversation. That goes into your other point about power. And I'm prepared to admit that I don't talk much about power. So the other question then is, why would you want to deprive alternative forms of power that flow from the bottom up, say, from the working class, from the labor movement? And that includes not just working people. That includes suffragists that stood for women's votes. That includes abolitionism. That includes the civil rights movement. No doubt these movements made a difference. Here's what I'd say, that all those movements with which I totally approve. I'm a feminist first wave. I'm afraid. But anyway, I'm a feminist. And I was against Vietnam. And I supported the, you know, I wasn't old enough to support the sit-down strike in the 30s. But I would have done that. And in favor of, and I'm certainly in favor of transgendered rights, I'm in favor of all of these and I'm against slavery. And I want it to be eradicated. I want sexual slavery to stop. And we ought to go in and make it stop. OK, good. Those are all liberal ideas. That's an extension of the idea that all men and women, dear, are created equal and are endowed by their creator, certain inalienable rights, which had become a cliche among advanced intellectuals in Europe by the time Thomas Jefferson, the driver of slaves, wrote it. But the Marxist line, the Marxist line of my youth, no. It's that's not what's it look. I think we could confine it to the question of, I don't know, working conditions. Is it essential that there be strong trade unions for there to be good working conditions? And I don't think so. I think good working conditions basically come out of increasing income that the workers have. And then they, you know, I won't stand for deans at my university taking whips out and beating me. But in fact, in the 18th century, beating employees was commonplace among free people. Among the minimum here, I think we would agree that it's not just ideas that ultimately drive history. It is movement that are embedded. I mean, that goes back to the French Revolution, the American Revolution. So in that sense, you cannot simply say it's people having great ideas. The liberal impulse here needs to be shaped up at the bottom. That's what I said, dear. But you're rewriting the agents. The agents I want to claim are the people. Read the third book. And then you'll see and read the first, which has a great deal of theology. Let me suggest you read My Christ and Empire and then we talk again. I will. We'll make a deal. Make a deal. Look, we haven't done that in this panel. And that's what's been so good about it these couple of days. We haven't engaged in talking past each other. And the main way you can talk past each other is to not read each other, or to put another way, not listen to each other. So no, I'm listening to you. And I've agreed on the PowerPoint. You got it? Except not PowerPoint like this, but PowerPoint. The point about power. But PowerPoint, by the way, is an abomination, even when it's handled very skillfully. But OK. So yeah. Thank you. Let's take a question from our audience. Is crowdsourcing and crowdfunding the next iteration of people having a go to change the world? That's a wonderful thought. I think it's true. I think what do they call it? The sharing economy is another one, Uber, Airbnb, both of those, to take advantage of the net, the worldwide web, to trade information. My friend, George Akerlof, a long time ago, made the point that a lot of exchanges, such as used cars, are damaged by asymmetric information. You want to drop that at a cocktail party and see what happens. That phrase, asymmetric information. That is, both parties don't have the same knowledge and so in the matter of women getting worse deals on secondhand cars. But this technology, both of which you mentioned, are solving the asymmetric information problem slowly. So no, I'm all for it, the more the merrier. OK, another question from our audience. So what happened or didn't happen in China that was responsible for its failure to capital? Well, what happened in China, and I'm not an expert on China and the expert on China in this room will laugh at what I say, but it's the Ming dynasty and then it's the Qing dynasty, which were both the Ming at the end of its rule in the 16th and early 17th century. It ended in 1644, was overthrown by the invaders from northeast of China, which became the Qing dynasty. These were conservative. And to go back to this question about elites, what you allow, what the government or whoever it is who's got the power allows is often a matter of how secure or insecure the elite is. If the elite is very self-confident, as it was in Britain, for instance, interestingly, and doesn't fear a revolution from below much invasion from abroad, which was seldom a problem in Britain, it can be accommodating to the bourgeoisie or to inventors. Indeed, the English gentry, and indeed, even its very tiny aristocracy, was notorious for engaging in mining coal. This man I mentioned, Matt Ridley, is the heir of an old aristocratic family that owned coal land and bloody well exploited it. Another question here. The capitalist system is based on continuous growth. As a result, we are using the planet's resources at an unsustainable rate. Can a modified version of a capitalist system succeed or even exist with zero growth? No, that's all wrong. Where could I start? Of course, there are limits. But that's a mathematical proposition. It's not an empirical proposition. Of course, if we were, I don't know, to have 300 billion people on the planet in 10 years, we might face a problem of diminishing returns or air pollution or something. But world population, it's calculated, and I think we now have a quite good take on this, is going to peak at about 10 billion people. It's something over 7 billion now. And then it's going to start falling, as it already has in Japan. So, sorry, I have a sinus problem. So it's not, you can't do this kind of physical sinus projection into the indefinite future and see disaster. I can't persuade you of this immediately, except to point out the interesting career of a man named Paul Ehrlich, a biologist, who in 1968 wrote a book called The Population Bomb, in which he predicted that by now we'd all be dead, essentially. That by the 1990s, we'd all be killing each other to get food. India would disintegrate and so forth. In fact, what happened is that India became a net grain exporter in this period that he was talking about. So not now, my friend, I have all these friends I keep talking about. Bob Gordon is a very old friend of mine. He's a professor at Northwestern. And he just wrote a book called The Rise and Fall of American Prosperity. And it's a wonderful book. I highly recommend it, although I buy these first. Because Bob is pessimistic. He talks about headwinds. Towards the end of the book, he says some rather shocking things for an economist to say, but let's set that aside. But so have so many people said before. Malthus said it in 1798 that we were doomed by population increase. Marx said we were doomed by the falling rate of profit, which, by the way, didn't happen. Keynes said that we were doomed because of excess savings. And that became, under Alvin Hansen and so on, the stagnationist hypothesis. Most economists in 1945 thought that the Great Depression was going to restart. Most of them thought. Unless we massively continued spending as we had during the war. Instead, we closed the arms factories, stopped building tanks, sent all the people home. They got jobs. And the economy grew faster than it's ever grown in its history. So I think that this pessimism I've written on this, you should go to my website if you want to hear more of this stuff. Deirdre McCleskey.org. And I have this pessimism and the world, the sky is falling. For reasons ask a professional journalist this. Journalists know that people love to hear sky is falling stories. Isn't that right? Yes. They don't like to hear the world is pretty good. I have a friend, another friend. Boy, I have a lot of friends named John Mueller, a political scientist at Ohio State. And he wrote, this will work for this audience. 1999, he wrote a very good book called Capitalism, Democracy, and Ralph's Pretty Good Grocery. If you guys know this, Ralph's Pretty Good Grocery. If you can't find it at Ralph's, you probably don't need it. And the point is a bad title because most Americans don't know what he's talking about. But John's point was that American democracy and the American economy, if you want to call it capitalism, work pretty well. God knows they got problems. We got to do something about the schools. We got to do something about this, that, or the other thing. But maybe running after Utopia across town, the absolute perfection communist grocery store or the great nationalist fascist grocery store might not be a very good idea. I'm not sure if this next question was intended as a fastball under the chin or a hanging kerb ball. But I'll leave it to the panel to do it. If it's a hanging kerb ball, I'm going to hit a home run. OK. It says, then, is the whole idea of economics redundant if invention and technology control the economy? No, although that's a very deep point that whoever's made it make that, that's right. Because when I teach price theory, as I have for a long time, 45 years in fact, I teach allocated economics. The point that all these economists here, we all teach supply and demand curves. And in fact, let me show you. Here's what happened in modern economic growth. I'll do it from your point of view as though I'm behind the blackboard. Here we have some supply and demand curves over here of England per capita in 1800. And all the economists here admit to doing harbors, triangles, and efficiency and supply and demand. We're talking the same language. So that's over here. What happened in the two centuries after 1800 in Britain was that the supply curve and the demand curve moved out. Now, see what I'm doing? Over to here. And all that stuff we're talking about, static allocation over there, it matters. If you have an economy where there are no property rights, where people are not having any incentives to do anything right, then you're going to screw up the economy very badly. How do I know that? Take a look at North Korea or, for that matter, East Germany. So no, we still need to teach this stuff. But we really need, and here I joined Paul in wanting to get economics off of the static stuff as much as I love it. I just love harbors or triangles, and I've done them very extensively. As economists, we have to get off that and talk about what causes this. And growth theory, as it's called, isn't going to do it. Growth theory is capital, capital, capital in spades, redoubled and vulnerable. It's not to the point. As we're getting close to wrapping this up, would our other economists like to weigh in on the role economics plays that the rest of the world should be about to happen? I agree with a lot of what you said. I think that this obsession with institutions, I think there's a real confusion as to, I try not to use the term institution. I think of rules. They're the things you write down on paper. And they're easy to write. And they make some difference, but they're not Nirvana. And then there are organizations which are teams of people. Yeah, you're right. And what motivates those people, that's a complex question, because it's not just incentives. I don't think you would say it's not just incentives. There's a complex mesh of mental constructs that people have in their heads, which generates that motivation. Now, I wanted to make one distinction. Your growth story is, of course, absolutely right and massively dramatic. But what we've now got is some countries are there, and others are there. And so we've got two very distinct growth processes that have to happen. One, the countries that are at the frontier will only grow if there's innovation. Yeah, that's right. And so it's a story about this wonderful idea of ideas having sex, that's actually, it's a vulgar image, but it's basically interactions between ideas. That is why the future is so deeply unpredictable, because we can look at what the research is to say, ah, these are the ideas that may go through in the next 10 years. If they go through, they'll then interact in ways that's hard to understand. And then that's the next 10 years. Then the third 10 years is interactions between things that we've not even dreamed, interactions between them. But that's the countries over there. The countries here, their growth process is a different growth, it's a process of catch-up. It's a process of catch-up. And so mental constructs will drive that process, but the mental constructs that really, really matter are not the new innovations. I agree. As Professor Rigger says, it's often a matter of power. Egypt is badly off because the army is taken over the economy, not because Egyptians are incompetent or something. Let me just push back on that a bit. It's obviously true. Political science has utterly bought into that over the last 25 years. It's the only act in town in political science why are poor countries poor because elites are abusing power. And that is, there's a lot of truth in that, but it really isn't the whole truth. That it's not just some place. But it is part of the story, and we are not talking about it. And it is part of the story, and we do need to talk. This is a serious issue that you did not address and that was not addressed in this conference. So I think there is some reason to go to that point. Yeah, there is. Fair enough, except that political science has been talking about nothing else for 25 years. So it's not a neglected topic. It might be a neglected topic amongst us now. But if you get to a country like the Democratic Republic of the Congo, which isn't democratic, isn't a republic, and has recently rebranded from Zaire. It's like the Holy Roman Empire. Yeah, quite. It's so poor that an explanation which says that it's poor because some people are doing very well is pushing it. Some of these organizations are so dysfunctional that everybody could easily be much better off. And so for that, to understand that, we've got to go beyond power to people trapped in mental constructs, which are deeply dysfunctional. Well, I've written a great deal on mental constructs of this character. I started this by talking about the rhetoric of economics in a book called That, and then in a book called If You're So Smart, about the stories that economists tell each other within their science. And my friends, like Ariel Klammer, kept saying to me, come on. Apply it to the economy. I said, no, no, no, I want to go on doing supply and demand curves and harbor triangles. No, don't tell me about ideas in the economy. And finally, I was dragged kicking and screaming to this conclusion that I've come to, which is very similar to yours, that ethics matters. Look, the traffic laws in Berlin and Rome are the same. No jaywalking in both places. But anyone who's been in Berlin knows that if you try to cross the street against the light, oldies with umbrellas will attack you. If you do the same in Rome, they'll go, but they'll say, there's a word. I can't bring back the Italian. I don't think it can. Il furbo, I think the word is, means the clever one. Il furbo, I can't quite get it. So there's this deep difference. A English journalist who lives in Milan and has since 1991, he teaches at the University of Milan. His name is Parks, and he writes on Italy. And he's very informative about this because he says that from when an Italian child is told to go to bed, now let's do it the other way. When an English child is told to go to bed, and undoubtedly this was your case, he goes to bed. Time to go to bed, Paul. You can remember this. Go to bed. Yes, OK, I'll go to bed. Parks tells me that an Italian child is told to go to bed, and he starts bargaining. He goes, oh, mama, cattiva, oh, and he goes to papa, and he talks about papa and papa, and he negotiates, and he ends up staying up until 1130. And this attitude towards those written down laws that you talk about is characteristic of Italy. Deidre, I finally understood my family problem. My wife grew up in Italy. Ah! And I'm going to ask you all to be English, and we're going to put this to bed. So thank everyone very much for joining our conference. Tonight, if you are not attending the banquet, you can livestream Chris Ferrell's talk at 730, correct? So thanks again, everyone. We look forward to seeing you again next year.