 This is Mises weekends with your host Jeff dice Hey, ladies and gentlemen, welcome back once again. It's Mises weekends. I'm joined by my good friend from Switzerland Claudio grass He's someone I've known for a few years I've known him through the precious metals industry. He was recently at PFS in Bodrum at Professor Hoppe's Event and is now visiting us in the US. He's a precious metals advisory agent for Swiss and worldwide clients Claudio great to see you Very happy to have you bringing us Swiss chocolate Here in Auburn, which is just one one good Swiss export, but I just want to set this up a little bit We're talking this weekend about the Swiss model Obviously America has some very deep social divisions a culture war We have a really nasty political environment since Trump won and as libertarians as and caps We have some answers some thoughts about how to ratchet down the hatred in society in the number one way We would argue is by sort of depoliticizing things By having private societies private ownership private property But short of that in the world in which we live here and now There's actually a country your home country of Switzerland is doing a better job of making life less political and and Switzerland is basically doing that through a very Direct and hardcore principle of subsidiarity and decentralization, which I got to say I'm a little blown away because when you look at the Swiss Legislature's own website The way they talk about subsidiarity as an important contribution to social cohesion Yeah, I'm quoting here is really amazing. So I want to talk a little bit about about Switzerland But from a libertarian or an cat perspective You know first and foremost Let me just say you said something the other day I mean, you know people get a little scared when you talk about hardcore libertarianism or anarcho-capitalism But when you talk to him about the Swiss model and radical decentralization, they they feel more comfortable Yeah with that to talk a little bit about that absolutely nothing when you when you try to explain I mean as a libertarian, of course, you know for me any kind of government is basically a criminal act But you know when we talk about anarchism Then you know most people are so far away From that concept or the only the idea about that concept that they don't know how how to handle that Kind of thought and what kind of picture they can basically draw in their own mind how it would be So I always combine it with with Switzerland because we really have You know, first of all, we're a nation defined by our own will You know, we had in 1291 basically we had three guys coming together taking an oath to you know to fight against foreign reefs and Foreign oppression and that's the whole basic idea of Switzerland, you know staying free in the pundit sovereign and And when we look at the decentralized structures, you know, we are basically have four different languages We have we were formed by different ethical groups different religions So basically when we look at how a nation state is defined in these days, you know Basically, you're saying hey the same ethical group or the same religion same language So Switzerland is none of this when there is another there is another country on this planet Which has the same basis and that would be the United States at the end of the day but because of that diversity and The decentralization, you know, it was able that The Italian speaking part from the Roman speaking part the German speaking part French speaking part They had their own their own culture and because we didn't have the centralized government Which tried to oppress and you know come up with one single rule for all of them we had a lot of competition and Decentralization means competition and it also means competition of ideas and it also respects of course, you know the different cultural habits of certain regions and I think that's why Switzerland today is a great model just to give you know the direction in which This world could you know modify Themself well you talk about diversity obviously America is very diverse ethnically Religiously in terms of national origin, but we don't have that many different languages a lot of people speak Spanish But they also speak English so even though Switzerland's about eight and a half million people I think yeah, it is diverse and So talk about this idea of decentralization subsidiarity Making real diversity more possible and creating social cohesion in other words the different parts of Switzerland the different cantons Don't have to fear each other as much as people in the US feel like they have to fear each other's political power Yeah, I mean I think the key is you know that Switzerland really has been founded on the ideas of you know The principles of subsidiarity from the beginning from the beginning so basically solve all issues at the lowest level You know if you municipality, I mean they were responsible still up to the day. I mean, you know, they can raise taxes They're responsible for To elect, you know the teachers electricity water supply. They're looking after the roads So stuff had been settled on that level and if let's say the municipality got the problem which you couldn't handle Alone then they were able to call up the next high level, which is the state So that's that's the whole concept and of course that keeps that keeps it, you know, I mean I like Aris total s, you know the Greek philosopher and he always said, you know demos the village karate are the rulers So a democracy can work, but on a very low scale You know when you really limit the power of the politicians because as we know power corrupts absolute power corrupts absolutely And so I think that's still, you know, yeah, you know look at even at the federal level No, we have not one president. We have seven presidents, right? So even they're a division of power is implemented and And at the end of the day When the government tries to come up with a new idea and they want to change the Constitution or whatever Basically, the people are the sovereign So, you know, we can always raise signatories and then we have to we can bring the front of of the people But the final vote at the end of the day have to Swiss people and that that prevents, you know, a lot of this progress which is Which is taking faster place, you know in other countries than right based on the on the rule of law in in Switzerland We'll talk about how minimalist really the federal Administrate administrative state is You may remember Lou Rockwell wrote a famous article one time about how he wakes up the day after the presidential election And nothing's really changed. It's on the back page of the paper. It doesn't really matter who won the presidency This is more or less true in Switzerland where you have a Presidents who just survive I think one-year periods and also the legislature meets very just temporarily, right? They come together four times a year for a short session, so You know the federal level basically that's their response with the foreign and security police So basically defense, you know, there are customs is under their rule the monetary policy Unfortunately, we also have a central bank. I mean the the great evil of our times And and of course legislations that applies to the whole country And defense and that's it and when we look at the I think it's it's important to see, you know How it is how a country is being financed? So When we look at the taxation, I mean all the three levels, you know The federal government the state level on some municipalities level they can all raise taxes and we have on all three levels. We have basically How do you say executive legislative and the 2d 2d skill judicial ranch So when we look at how the taxes are distributed, I mean the federal level gets 10% That's it. Yeah, and then the 90 90 percent are, you know The biggest portion remains with the municipality and then a certain portion goes to the state And of course, you know, so we have based on that structure We have a lot of competition because if a municipality decides, you know to raise taxes And the people are all happy with it. Even if they are, you know The 49% losing they have the possibility to vote with their feeds, right? You know, they can say, okay I don't like it in the village of Hünnberg So I'm I will move to the next one in home, which is maybe 1.5 kilometers away And so that always keeps, you know, the politicians and also the ambitions of these guys Probably under control We're sort of the opposite. We tend to send about 80% to federal of our taxes Maybe 20% state one one or 2% local Yeah, this is crazy. I mean if you look at the history of the United States and our constitution We were set up much the same a central government of very limited constitutional power The the rest subordinated the states it didn't last It lasted less than a hundred years. The civil war comes along How is how is Switzerland managed to make federalism last? Why doesn't the central government try to encroach? on smaller on on communal or municipal municipal governments I mean first of all, I think it has to do with the DNA of the people, you know, the whole culture The history so we never had a king. We never had a president. So we don't trust central authority We don't we know that government cannot give what it has stolen before So, I mean, we just had, you know, for example a few months ago. We had a public boat You know, that's every every family of four gets an unconditional basic income of 75,000 francs a year and We had 78% of the people saying no to that offer and I think that's quite unique in these days Or we had another world, you know going for six weeks of occasion mandatory six weeks for everyone So the Swiss were saying no against there, you know, they could have profited from it But they understand what it's about, you know to keep the government out of out of that business Which yeah, he has nothing he shouldn't have to say in that. So I think that's I think that's That's that's really, you know part of it and then the other aspect definitely is You know with our political structures, we have Chained the government To ensure that the government does not put chains on us on the people and enslave us And I think there we have done the better job based on our structures Then for example in the United States because I mean the idea of your constitution was also pretty good But the politicians they just come up with new amendments and change it and interpret it Completely different, but I think the wording was also basically quite clear what you know the founding fathers meant by putting chains on The political system and the politicians. Well, so 78% of Swiss or at least Swiss voters Voted against a universal basic income guarantee and you said about 70,000 Swiss francs 75 There was a figure that has been brought up I mean it was not 100% clear how much they are going to receive but basically the idea was, you know 75,000 that should be is that middle-class existence. Well, it's below. I mean, I mean You know that not everything is shiny in Switzerland and we can see that you know in the past We had you know the bankers were basically the guys making them the biggest average income right now It's became you know the government employees. So so they have an average income of a hundred and forty thousand, right? Right. Okay. So 75,000 is at least I mean it's you can live with it But definitely not. I mean, which one is expensive. Well, I think in the US even even US Libertarians, I'm not sure 78% of them would vote against universal basic income But certainly us the US population generally that that might prevail here if that was ever held to a vote You know, we talk a lot about how Wars abroad Diminished liberties at home talk about how staying out of two world wars, particularly in the 20th century staying neutral in those wars it helps Create the Switzerland you have today and you talk about sovereignty and freedom being in the Swiss DNA Do you think Switzerland would look a lot different if you got pulled into those European wars? Oh, definitely. Definitely. I think there is also I mean, you know the Swiss You know, we never had Resources in the ground, you know, we're pretty, you know, we had The Alps which made it hard, you know to control the whole territory But I mean even angles he was he was traveling around end of the 18th century and then he came back and he was saying Yeah, Europe has a great and bright future with one exception That's Switzerland because it's a shitty country to speak different languages They have no centralized power and no natural resources and so on just this mountainous place with no resource, right and And the Swiss I mean we have, you know, so in the past basically we have been, you know The toughest and the most brutal mercenaries, you know Because they had to survive somehow and we had winter time and summertime something they had to plan and it wasn't easy to make a living in Switzerland, so we basically exported a lot of mercenaries and That lasted until the big battle of Marino 1515 where basically we had you know on both sides Approximately 10,000 mercenaries fighting against each other and killing the Swiss were killing each other and Up to then we had also ambitious, you know, the Swiss were strong Hard-hard fighters, so they tried, you know, also to take over, you know, especially in northern Italy And after that battle of Marino at least, you know, the Swiss decided, okay, we stay out of Out of, you know, we don't have expansionary Last any longer, so we stay within our borders and So then, you know, that that's the kind of the basic setup and then of course first First World War second World War Also 1815 there was the Congress in Vienna where it has been decided that Switzerland remains a sovereign armed neutral country by the the foreign powers that had an impact and So that's why we survived. I mean the First World War was not, you know I mean that threat was not that big as in the Second World War, but I do remember the Second World War We had the famous General Gizzo And he said, you know, we are not going to surrender and the Swiss will fight to the last man standing and The Germans the Italians, I mean they were surrounded by by those guys I mean they knew exactly, you know, if if we if you fight the Swiss, I mean, it's a piece of land, which is Not not as much, you know important of importance. Yeah But they also knew that we are going to fight hard And I think that was one of the reasons they haven't been aided as Switzerland because it was really yeah Neutrality only works if you are armed forces and you're strong to defend the neutrality if necessary Well, when you were a young guy, we spoke a little bit yesterday about your mandatory service time in the Swiss military You were you were the head of a tank division not a division a tank company Did you did you resent that? Did you feel? Fine about being conscripted. Did you feel proud of being in the Swiss military? I mean talk about your thinking as a young guy then I mean as a young guy, I mean I was You know, I had a great time in the military and back of course, you know for a young guy It's always a shooting and you know playing soldier. I mean, it's great. It's it's an adventure. No real war. No real war Yeah in the US you actually get sent. Oh, that's I mean, yeah, that's now I think yeah an army needs, you know We have to defend our borders and therefore people need to understand, you know that if you have an army Then it's basically for national defense. We should not fight somewhere at the Hindu Kush to defend our liberty over there I mean, this is nonsense and how about how about we're women conscripted as well back then Hardly, I mean we just had a few logistic groups where basically women if they really wanted they could sign up So of course that agenda is also pushed being forward, you know by our national government they want to involve the girls more and I Don't I don't find it's basically unnecessary. I think but at least you know, I mean as long as the people understand why they serve and You know to protect liberty and freedom in a harsh crisis scenario. I mean that must be there must be the goal What do you think about the mindset of young Swiss today? Are they as? Socialist left-wing as jaded as Young Germans or young Brits, or do you think that they still retain some of the Swiss DNA that you've talked about? It's pretty interesting. I think there is you have the differences between the cities and the rural areas I'm the rural area sometimes. I'm surprised to see how sound The house is over there, you know in terms of thinking and they want to they want to do. Yeah, they want to pursue you there They're like their happiness They are quite conservative. I mean when we look at especially of the SVP, which is so-called right-wing party But it stands for you know, and they they occupy the right topics They are saying a sovereignty Neutrality Independency small-state that's their topics. So they have a lot of the young people basically are sympathizing with with SVP and then of course the more you go into the city areas The more socialistic it becomes and the more multicultural also becomes and you know in combination with the big multinationals so it has And you can also see you know when elections take or when votes are taking place and then you always see the differences But the majority so far. I mean I'm You know, we we try to end Swiss Propaganda for example, we were gathering a hundred thousand signatories because we are forced to pay 1.4 billion To finance public broadcasting public broadcasting. So to finance basically government propaganda And so we raised a hundred thousand signatories saying hey, we leave it up to the people in the future They should decide if they want to do it freely or not and So I was you know, I was also helping them to raise some some signatories And then I had to talk with a lot of different people and it gives you a good insight You know in all those different How this was because right you speak to I know I most likely have spoken to five six hundred people and I would say 75% Absolutely great. Wow, you know, they still they still have it. They they understand that the real ways basis They are kind of Libertarian without knowing that they Kind of libertarians and so on. So I'm positive. I mean, I'm of course, you know, the centralized government they also try to Get more power and grip grip on it. So far the Swiss are resisting pretty good I want to touch briefly on Swiss banks. They've lost their luster Somewhat in terms of the privacy they used to afford the Swiss National Bank has also gone off the rails In the last five or ten years for a while it had tied the Swiss Frank to the euro. There was a peg I guess that's been released Talk about the banking sector and banking culture in Switzerland and how what it used to be versus what it is now Yeah You know, I mean you still have to the work ethic, you know, I think I mean what we can experience Since 2008 I mean we have seen a lot of money went to Singapore and Hong Kong Now basically over the last two years three years It's coming back again because just the whole culture the way the way the people work, you know the way They the privacy at least you know amongst the bankers and so on. I mean, that's It's still you know a better culture But when we look of course at the UBS or crazy space, I mean, they are not most ways banks multinationals They're I mean, yeah, you were so had, you know more employees in the United States than in Switzerland And so they're part of the system, you know crazy ways even as they have a CEO right now coming from the ivory cost You know, I think Swiss banking we still have a few Private banks smaller banks which have also Swiss Leadership we even have private banks where the partner are Responsibles their own wealth. So these are you know, you need for the Swiss banking for a nation that is saying hey Okay, we are independence over in if the Americans come up saying hey, this is a crook or there's a crook I mean, yeah, we know international politics. So it's not always that, you know, the crooks are really the crooks So and in the past basically the Swiss bankers they understood that in a post it has been abused as well, of course Which always happening if you have a certain amount of liberty, but I think yeah, the Swiss banks You know, I mean, it's It's too big the banking system definitely still I mean it has shrink But you know when we look at the leverage in the banking system, it's huge when we look at the central bank It's the hedge fund at the end of the day But Yeah, that's you know, that's why we have to make sure that more Swiss people are also buying physical gold, you know Because I mean it's everywhere pension funds. I mean, it's a joke You know if somebody relies on the pension or you know the promises by the government I mean when we look at these unfunded liabilities all over the world, you know, which is 15 20 times higher than the funded that It just shows no it's bankrupt So I think you know what I also try to do in the future is you know, really go out talk to the Swiss people and try to Explain them gold why gold and how you can protect yourself You can be you can have your own pension fund and you don't so that you're not depending on government promises, right? Well, we're almost out of time. I'd like to ask you a little bit Enclosing here about the real diversity amongst the cantons. They have their own coat of arms They're a lot like us states in that sense But I think they have a lot more power in leeway than us states do relative to the federal administrative state Could could you have different social? Rules and regulations at the canton level here I think America would benefit greatly if we could you know move abortion and gun control and religion some of these really contentious issues Down to a more local level instead of this federal one-size-fits-all policy that makes everybody miserable and angry at each other Is there diversity even amongst social? Policies within the can't amongst the cantons. Yeah, I mean especially when it comes to you know health and social security I mean that's still on it on a state or content level. Okay, so it can be you know if you if you go to Geneva, for example, then it might be that your Health health health insurances Might be double the price as in the state of took where I live for example So I think yeah, the best is really diversifying, you know, I mean decentralization Cut off, you know cut off the money which is going to the central state and you know really try to To move those responsibilities away from the center and bring it down on the next level and you know If as long as I think that's that's that's the best way I mean for yeah the money you have to cut the money to get these guys out of power And you can organize it yourself on on on a lower level and it's it's not a problem at all And I think that would also be great great for for the United States Well, I hope so because we're we're in such an ugly period where people are talking about Civil War Claudio I want to thank you for your time. It's great to see you ladies and gentlemen We will post a link to the Swiss Legislative website which is unbelievable because it's not grandiose or expansionist is actually humble and Self-effacing so when was the last time you saw a legislator saying we want less power Really amazing and and I think it's important for and caps and libertarians to be talking about Maybe that real-world solutions, but at least real-world direction. So with that Claudio, thanks again. Great to see you ladies and gentlemen Have a great weekend Subscribe to Mises weekends via iTunes you stitcher and SoundCloud or listen on mises.org and YouTube