 Hello and welcome back to War Economy and State. I'm Ryan McMacon. I'm a senior editor with the Mises Institute and with me as always is my co-host Zachary Yoast and this is the monthly foreign policy podcast of the Mises Institute where we just check in and see what regimes around the world are trying to do in terms of starting World War 3 these days and And and that always includes of course the United States regime which is an active player in playing up global conflict But we're we're open to criticizing all regimes equally and so we like we like to give them a close look and and this week we're looking at the antics from both the US government and the Chinese government in terms of balloon hysteria and It has certainly been a big issue since a Chinese balloon of some kind flew over the northern continental United States and Then there were there was basically a freak out in the media less so from the Pentagon The Pentagon's a little more restrained when it comes to actual foreign powers who could put up a fight I've noticed. Yeah, sure the Pentagon's always in favor of invading some Country that can't defend itself though and it comes to another country with nuclear arms and stuff often the the Pentagon is a bit more reasonable and They seem to be somewhat reasonable in this case But the hysteria in the media and among politics are especially Republican politicians in Congress Was just quite over the top and so if you weren't following the story there was this big balloon and It was over the US and then it didn't get shot down till it exited US land space Over the Atlantic Ocean down I believe off South Carolina and then it was shot down and We are supposed to believe that this presented a grave and novel new threat to the American people somehow Never mind the fact of course that China has many many low orbit spy satellites That are functioning as we speak and of course the United States does the same thing so talk about a tiny blip in the whole record of large countries spying on each other Because they can and because they do and have been doing so for many decades but I guess for some reason this big balloon because people saw a photo of it online got people really really worked up about it and We're trying to kind of point out the absurdity of this, but also just how insane it is to just try continually trying to Stir up conflict with the Chinese regime unnecessarily Which by the way should never be confused with pacifism or this idea that armed neutrality has no benefits But the fact of the matter is is that Starting a major conflict with a major nuclear power over something so minor and which provides no reason To suspect that any sort of new or real threat is offered by it Really is just a great illustration of just how sterical Washington is and I think how much they recognize that maybe they can benefit From whipping up the voters in terms of anti-Chinese sentiment But maybe you have a different take on it Zach I mean when you when you watch the Chinese thing Unfold the balloon balloon gate What was your reaction? I definitely wanted the government to shoot it down And I think a lot of people did just because we all have a toddler inside of us who likes to you know Pop the bubble wrap and there's just a giant bubble wrap up there But um, yeah, I mean it to me it made sense to shoot it down It was violating our sovereignty and all that sort of stuff, but it wasn't that big a deal as you've mentioned I mean, there's so much spying going on. This was just a highly visible incident of it And I think it might be how Americans have such a highly moralized view of foreign policy Where it's sort of like a romantic play or something that It's just outrageous to them that this this is happening Whereas if you have a more realistic Conception of how you know the tragedy of great power politics as it were You'd understand well, this is just something that happens and we don't need to go code red I mean one of my friends Told me that he got into a fight with someone at his church because this person thought That in response the US should sink China's aircraft carrier Which by the way is ancient. It's literally a Soviet Union like Fire sale like junk that they actually bought from Ukraine. Okay. Yeah, if you're picturing a Nimitz class aircraft carrier You are picturing picturing something very very unlike the Chinese aircraft carrier. Yeah People were going nuts over this there's spying going on all the time I mean DC's undoubtedly infested with spies including from our so-called allies and friends But sure it's violating US sovereignty so we should shoot it down. I mean like people were complaining that they missed Now they're shooting down, you know anything that moves apparently above a certain altitude and Over Lake Huron apparently they missed with the first Sidewinder missile and people were complaining. Oh It had each missile cost four hundred thousand dollars, which is you know a lot of money But it this all this money shooting down. Who knows what is the best money the Defense Department spent in decades It's actually been spent in defense of ours, you know sovereignty of actual America It's something that occurred within ten thousand miles right United States remarkable And now comes the UFO talk, right? I mean Who knows all that stuff that's up there and this is actually a tactic China has used off and on as you know You just fly a bunch of stuff around and see what happens And actually if the balloon exercise was an attempt to see how the US public would react To Chinese devices in US airspace they collected a lot of interesting data there. I would say I mean who knows They maybe they just did to see let's just see what happens. That's an intelligence gathering mission essentially Yeah, I mean think of how much how many man hours were dedicated to These balloons and whatnot. I mean it took up a lot of finite space and resources of people scrambling around and I mean Also the balloons. I mean it sort of speaks to how secure America is in that our enemies the traditional ways our enemies attack us is with high altitude balloons because in In World War two, I think like the only attacks on the continental US Were Japan floated these balloons way up into the stratosphere with bombs that just randomly fell Like in the Washington Forest or something like so, you know, it's it's not that big a deal I thought it was sort of fun Just you know, oh boy this thing everyone can see but it's not Spying's not the end of the world everyone does it and I think the fact that so many people don't get that speaks to how we just have a Poor understanding of the international system. Well, and of course if when you hear about something a alleged spy device being shot down at high altitude if you follow international relations, of course, you immediately think of the 1960 you to incident where the Soviets shot down an American plane Over the Soviet Union which had a pilot in it who parachuted down and then was captured he was sentenced to for espionage and put in prison where he served two years before a a Trade with some Soviet spy in an American prison and That was that was a whole big deal Naturally wasn't surprising at all to hear that Eisenhower didn't think it was a great idea to fly these planes with pilots in them over the Soviet Union And he was he was correct But you know funnily the the United States First to claim this was a weather information gathering mission Which the Soviets didn't buy And then there was a whole cover-up and of course they were telling the public one thing and you know Just the exact sort of antics That you would expect from any sort of nation-state in this position, and I just always think it's so funny that With when China behaves exactly like the United States either is currently behaving or has behaved that this is some sort of a dastardly deed Unun Rivaled in the history of international state relations, but I guess it comes back to what you say about this moralistic view Toward everything right and I guess it kind of makes you miss the British a little bit at least the British during all their Colonial antics and international meddling. They all did understand. This is this is the game Right. This is what we do to you know deal with our rivals like France and Russia and Turkey and So on and there was a certain detach a moral detachment from it to be sure but yeah Americans everything's moral and so it's and every war is It has to be like some moral crusade and so that just I guess informs every foreign policy decision That takes place within our borders but you raised another issue on this was an interesting legal issue that Is fun to think about and maybe someday will be relevant is What if a state national guard unit state Air National Guard unit had scrambled planes and Shot down the Chinese balloon itself saying hey We just had this we had this incursion in our airspace and we don't know what it was So we shot it down. That's what the Air National Guard is for it was a defensive measure How do you think the Pentagon would respond to that? Well, how would that change the nature of the debate? Yeah, this was an interesting question I just thought of watching the balloon float along when everyone was like why isn't the government shot shooting it down Etc. Etc. And I'm definitely not a lawyer But in my Google law degree The Constitution says that a state cannot quote engage in war unless actually invaded or in such imminent Danger as will not admit of delay So I think it part of the question hinges on whether or not an airspace violation is Would count as an invasion But I also Talking with some friends discovered another loophole where if the airspace violation did not count as an invasion Then it doesn't fall under the federal government's purview Could a state shoot down the spy balloon Claiming that it was violating like wiretapping laws or something and it's like this is not a military operation You know, we are just enforcing our our own laws whereas if it was I think it could be a fun court case You know if it was actually like this was an invasion. We have the right to shoot it down I mean who I doubt the Supreme Court would be super amenable to these sort of states rights state sovereignty arguments, but It would be fun nonetheless Yeah, I think as well established that the constitution doesn't actually care what the text of the cost or that the supreme court doesn't care what the constitution text actually says And what was clear to everyone in the 19th century apparently is like reading Sanskrit today for federal lawyers So You're right, of course That's a great loophole, right if the federal government says Oh, it's a it's a violation of US sovereignty. So we had to shoot it down That would create it would seem the precedent not the legal precedent in the technical sense, but Certainly a political and tactical precedent That oh, well a foreign Balloon in your airspace is an invasion And if it is an invasion then the state national guard Has the prerogative to deal with it. So I would love to see how that would be Delt within court I think would only become an issue in the future as the federal government starts to weaken in power due to massive debt and things like that But uh, yeah, right now, I think there's uh, I don't think it's likely the Pentagon would absolutely freak out I think if the the state national guard informed them that we've sent up some planes to shoot this chinese device And we'll just see what happens Yes, also though it could there would be a I mean it'd be good states asserting, you know They're right decentralization, but there would be the trade-off Of then we'd get all these governors would be posing with like these giant cold war era Flat guns that can shoot up to 40 000 feet. They'd be running commercials like we will defend, you know North dakota from the chinese threat It would sort of be like michael dukakis driving around in the tank except people would be like, oh, yes We must defend the cornfields of iowa from the chinese spying Except the flip side of that is though That's not as dangerous because none of these national guards have the capability of launching international wars. They're taking that is true That's true. Yes. So they're very limited in their capability. Yes So it's kind of like the lithuanian air force Having a parade or something like that, right? It takes 10 minutes Although actually I would probably say that your medium-sized us state probably has a bigger air force than most baltic states But nevertheless, yeah, they don't have really aggressive military capability. Defensive is sufficient in my view But uh, you're right. That would be quite a sight to behold though But I would think the federal government would view that as a big challenge to their power Uh claiming oh look these these state governments now think that they have some sort of role to play in the military defense of the u.s Which of course was the original intent of the text of the u.s constitution But since we nationalize the national guard in 1903, I believe with the nox act We don't believe that anymore. I guess Um, but you're right. I think it would revive that even the I mean like the pennsylvania constitution which has been uh revised since Uh in the last century The the pa governor is like identified as the commander-in-chief of the pennsylvania armed forces And I think it's like that in lots of other places too So it's like I mean it the it's sort of like the legal structure is there for um Some semblance of a case to be made and it also on a sort of funny side note When I was reading about all this I discovered that it's actually been upheld by the supreme court that states can have treason clauses trees but that it's um Basically, it's understood under a legal doctrine that a citizen in the u.s has two loyalties one to the state in which they're a citizen of and to the federal government And in the constitution but also under a regular, you know, they've recognized this in practice The state can you know prosecute someone for treason against the state? And I was very surprised to learn that that's actually how john brown was executed I did not know that but um, no one's been executed for treason against the u.s apparently but uh against the state of virginia They have been so that was amusing. Yeah, I did an article for that on mesas.org looking at the history of basically insurrection and it was in relation to january 6 and it looked at the the existing laws that we have in terms of treason and treason like Crimes and how this is all really a post civil war purely post civil war Invention of any sort of insurrection Or treason charge beyond just what was listed in in the constitution very strictly as actually taking up arms against the united states And part of that was going back to the english civil war like most of the bill of rights and all the good parts of the constitution Because the steward kings were always Broadly defining treason to well this guy did something I don't like so he has committed treason and there was no clear limit on what that meant So they very closely defined in the u.s constitution So yeah part of the reason so few people have been actually prosecuted under that is that historically The law allowed for very little but they created then all of these sort of insurrection related laws Not quite at the level of treason and then you can be nailed for those things um, but the initial idea was that all of the only places that people could have been prosecuted for Trees and were most likely to be prosecuted for taking up arms against the state somehow um Was actually at the state level And yeah shades rebellion Right exactly all that sort of stuff and all those little things that happened throughout the late 18th and early 19th century This was all state-centered stuff But back to the chinese balloon So the uh, uh one thing that I thought of immediately When I saw the whole freak out over the balloon was here we go again now, uh, this was because I remembered back in one And I sent you a funny email about it. I said I said hey, you remember this And you said I well, I think I was in a grade school at the time. So I don't really remember But I was about 24 When the high non island incident occurred and so if you're middle age like me you may remember then that Back on in april of 2001. So this is pre 9 11 A us spy plane was 70 miles off the coast of uh, china specifically high non island, which is very much part of china and uh, so it was intercepted by two chinese planes and They uh, they one of them collided with the us spy plane Uh disappeared pilot presumed dead afterward The us plane however was capable of landing On high non island where the pilots were captured and detained and then of course uh, the bush administration Had to negotiate with them to get these pilots back and all of that and There was they they for the most part de-escalated the situation and were fairly reasonable about it Uh, but remember this is all pre 9 11 to When at the time the us actually when bush had run on and won on a humble foreign policy position And hard to imagine that bush had tried to express that his foreign policy would be about uh limited limited meddling around the world But that certainly changed with historical events After 9 11, uh, but then there was yeah, so there was a whole dust up with that But there was a very much while the the the federal government Responded with some amount of reasonableness If you had a response at the media and in congress very similar To what you have now where he had lots of members of congress just absolutely going bonkers over there How dare how did the chinese intercept our plane that was flying right off their coast? And our spy plane by the way And and then of course the media, you know russia limbaugh those sorts of people just went absolutely bonkers Because you had all these unreformed cold war type conservatives who already in 2001 wanted a new cold war with the chinese back then Which i guess was uh Just to keep china from being less poor. I mean that's mostly what china was focused on back then And and of course boy, how many trillions of dollars of Goods and services. I know we act like we don't export anything around the world But the fact of the matter is the chinese not only you buy a lot of us services, but also invest a lot of The money we give them back into us capital And of course buy us debt which enables the federal government to spend even more On all you people on social security medicare welfare, etc Uh, so that's all that's all due to uh reinvestment of uh dollar spent in china back into the united states Nevertheless, uh for for 20 years We've been hearing about the need for a new cold war in china and so The it just was basically a repeat basically rhetorically nowadays with the The chinese balloon and uh, and then the high non chinese incident The the role i guess was reversed of course is that it was the u.s That was spying very very close to china and of course the u.s has all its satellites going over china as well But it was the same sort of moralistic Uh posturing back then was oh my goodness in attack on a u.s plane is like an attack on oma ha Nebraska And we have to do something about it and these chinese aren't going to stop until they destroy all of our airplanes And uh that was that was a tone back then and of course not surprisingly Lou rockwell had to write articles saying hey, maybe world war three with china is a bad idea and uh, you should think twice about it You write wingers out there um Then of course we forgot about china because of 9 11 for a long time But now it's back and so i guess we should just expect more and more of this as time goes on Right where just every little thing with the chinese is going to be Just one more call For escalation with the chinese How much of that is true in reality and how much of it Translates into actual behind-the-scenes conversations between the u.s regime and the chinese regime That's something people have to keep in mind is that politicians will play up their belligerence Toward foreign regimes a lot for public consumption because they know the public Likes to go bonkers about hating on foreigners, but then what's out of sight is These politicians saying hey, you know I i have to pretend i hate you for the hay seeds back home But you and i of course know that we'll get along just fine as these as two regimes that have to coexist in the world That doesn't mean of course the u.s is going to retreat from Its positions in east asia, but i think You probably would expect that behind closed doors the u.s is going to continue to tell the chinese the regime that like look You know, we know you're spying us We're going to continue to spy on you, but we had to shoot it down For the case of the public and then make a big deal out of it But we'll just go from here and that's probably closer to the reality But i think that the more the public presses on this issue the more it could really produce i think An actual overreaction that could cause real problems at some point in the future Yeah, um, yeah, i thought it was bad that the u.s cancelled a high-level diplomatic talk with china Because of the balloon incident Whereas i think you know If the public was sufficiently macchio-vellian in the good sense They would just see that this is what happens And i think that it it might be helpful to talk about like why all this spying happens and it's not just between supposed foes You know china and the u.s But i mean I think one of the only actual treason convictions In u.s history was against um jonathan pollard who worked for one of the intel agencies who was convicted of spying for israel You know quite a different reaction uh, um to uh To that back then versus now with china, but it's like what is real there are friends Why would they spy on us? It's like it's guaranteed all of our nato allies have spies in dc and whatnot And it's it's because of the radically uncertain nature Of the future which is sort of a core, you know realist a fundamental Assumption about the world. We don't know what the future holds and there's a very good quote from charles de gaulle, which is um States do not have uh states have no permanent friends Only permanent interests, you know, so Who's your friend today might not be your friend tomorrow? I mean there's very If any of the viewers have ever watched, um Yes prime minister. It's hilarious 80s british sitcom The prime minister. I can't remember exactly the context, but The guy is explaining to him, you know, we must be prepared to face our true enemies and he's like the soviets No, the french, of course You know, it's like the soviets are just an interlude in our, you know, 1000 year long feud with the french And it's like, uh, everyone spies on everyone because we need to know information We don't know what other people are thinking and it's why the world is risky Why there is the tragedy of great power politics is even if a state is Building up militarily purely for defensive reasons. There's no way That any other power can know that for sure And so they feel threatened and then they build up, you know, and hence, you know the unhappy Fallen world we live in But so it's just spying happens Sure, we should not like be oh there goes, you know Chinese spy plane or something But You know, we should just recognize this is as normal as you know You know people stealing from the grocery store. It's it's not good But it's just a fact of life that happens and grocery stores Have learned to deal with it and We just need to, you know, it happens. We don't need to, you know You know set up a guillotine to execute shoplifters just because it's a fact of life Shoot to kill everyone who breaks the law Yeah Yes, this is of course a very important point is the uncertainty, right and you can see this Uh in how uncertainty Often leads to unnecessary conflicts It's it's not just that uncertainty makes people afraid and so they're unwilling to enter into conflict Um that maybe could be an issue but very often Other states are often overly confident about their abilities Or about the defense of other states. This has been historically an issue. So This is in many cases states have started wars With an unrealistic view of their relative power and capability Relative to other states because they just didn't know the size of the economy of the other state Um, they didn't understand maybe Just how much another state was willing to put up a fight for a long period of time and all of those sorts of issues And if you think if you miscalculate and think those things are low that look they're going to give up immediately And then you start a war and it turns out they weren't willing to give up immediately Or that they had economic and military capabilities that You weren't aware of Now you've started a completely unnecessary war that you had no chance of winning and so You can see why why everybody's going to want to spy then in those cases There might be an off chance That oh, you only need to build up your military power So much in order to be on a par or have true defensive capability against state x And how do we know this? Well, we need to send in some spies to maybe get a better idea of what the other state's capability Is or if you're an aggressive state you want to send in spies and say hey, can we get it get away? With attacking this state, but then you send in your spies and the spies are like, oh, yeah Well, these countries they got like huge military and economic capability. We better not try We better not start a war with them. Well, that's that's all to the good then if That sort of information flows in a way that it prevents conflict and One way that actually worked And one of the many instances where the cia was just so pathetically wrong was when They continually Reported that the soviet economy was a powerhouse And was just amazing and you can look at some of the the ridiculous Ways that the the soviets try or that the cia tried to measure the soviet economy. It was They just looked at the amount of dresses in department stores and things like that And some some critiques by econops have come out on this noting that the cia had no concept of Like different hetero genius nature of quality In goods and services So they just counted the number of items available in different item classes and didn't look at the equality And recognizing that everything that the soviets had was just a crappier version of what the americans had Right because their economy was garbage So there was this huge overemphasis on what the soviet economy was like now on one level that Prevented the u.s. From being more belligerent than it was to the soviets on the other side There was a downside because it continually fed american hysteria about a missile gap in our inability to deal with an aggressive soviet union so It's hard to predict how a lack of information will play out But yeah, not only does everybody want spies for that reason But how do you know your spies are actually even collecting reliable information? And so it's just it's just with anything right industrial espionage You don't know what's going on with your competitors and you're just trying to get some info and you never know if it's good So it's not going to end not going to end anytime soon And also doesn't really provide a big threat either in terms of with the united states so far ahead Of everybody else in terms of military capability other countries knowing to what extent the u.s. Is far ahead of them Provides no threat to the u.s. All it does is reiterate the fact that the u.s. Has thousands of nukes uh, and it has a nuclear triad and it has immense defensive military capability it may find out that The u.s.'s ability to maybe wage war in eastern europe is not that great Uh, but in terms of defending north america, I think all they're going to find out is that oh, yeah Trying to send a flotilla across the pacific ocean to the west coast of north america probably is not a winning strategy Right. Yeah, another another sort of recent example that everyone's forgotten about now Despite the hysteria at the time was the hypersonic missile with china Uh, you know launched an intercontinental missile that you know It traversed the entire globe at hypersonic speeds And people were freaking out and everything But in reality, you know, uh, it's not it Our inability it just sort of like speaks to misunderstandings about missile defense and things like that It's like Doesn't matter if we can shoot that missile down or not Because we have a survivable second stripe Capability, you know, and everyone was like this is such an intelligence failure You know, you know the hypersonic missile gap and And all this stuff and it's like it doesn't matter if china builds another thousand nuclear missiles or something They only have roughly 300 now it's just like We could, you know, brain death and destruction upon anyone who You know used a nuclear missile and if that deterrent does not work Well, you know, it's not it's not much good and it sort of like gets to like we've spent Gajillions and I mean so much money on missile defense over decades. That's almost entirely theoretical And I mean you can make the argument that missile defense actually is destabilizing because if one country thinks Oh We can't Issue a second strike. We have no deterrent against the u.s. Or whatever Then it leads to this sort of innovation. I'm like, oh, we need a hypersonic missile and things like that So I think it's sort of I think missile defense is also another issue that's driven by Public, you know outcry of do something do something itis, you know, and it's just sort of spying You know the ability to nuke the united states. These are just facts of life that We have to live with and you know We can be calm and collected and things will Be fine most likely most likely right and Back to that point of how many nukes you got I mean, you may disagree But I don't think I happen to agree with the school of thought that you just don't need that many for deterrence So if the u.s. Has 5000 nuclear warheads ready to go That's probably about 4,900 more than it actually needs to provide deterrence And so yeah the some hypersonic missiles when you have a nuclear triad Moving around where two-thirds of that is moving around all the time. I mean, it just means nothing But it's a similar thing then to the spy thing But if you're not paying attention To international relations ever until something is on the front page Of the online newspaper Then it seems like this is some new amazing threat and then people freak out because they're just not otherwise Paying attention so they don't know about all that white noise that's going on in the background constantly So this seems like something new and threatening And they and it's amazing to it at the threats they will ascribe to the chinese regime When you consider the size of the american regime and its ability to violate rights of americans So americans are spied on every minute by their government Are open to all sorts of federal prosecutions at any given time We've seen what happens at places like waco and all of that But oh the real problem is the chinese regime because they might take a picture of your backyard So much worse than what the fbi might do with its latest fiza abuse Against your fourth amendment rights So it's quite remarkable what people are prioritizing there And i guess that's one of the biggest downsides of nationalism and i think that nationalism as a threat is way overblown But one of the real problems with it is that it does tend To have people just ignore what their own regime is doing against them and focus laser like On what foreign regimes are doing out there and then encourage greater power be handed over to Uh, quote-unquote our regime what they view as somehow an organization that that is their friend Um in the name of fighting some foreign regime, which may not wish them well either but Has nowhere near the capability of actually violating their rights the way the domestic regime does In most cases and so that seems to be just a dynamic here As well with the the threat of chinese spying being held up as far far worse than whatever it is The u.s regime is doing Against the bill of rights at any given time. So that's just a dynamic. We're stuck with for now as well Yeah, it's sort of the like the that the part of sometimes people arguing favor of sanctions unlike i ran and stuff as if we squeeze the country that people will stop supporting the regime it's also the same logic behind at least part of The argument for strategic bombing campaigns Is you know, oh, well just the level of the city and the people will rise up against their government and historically You know, it's like never happens the people rally around the government Um and and and on the spying thing I can't remember when it happened now It was like eight years ago Maybe or something but there is a hack into the federal government like personnel database I think it might have been by china or something but it's like The government got all this information on like all these people who work for the federal government because it was the federal government's information on the people, you know sort of uh, you know Ironic in a sense now. I think we pay for uh, you know, uh life lock or whatever it's called for like thousands of former federal government employees, but The the whole thing's ironic. I think is uh, is part of the fun of keeping track of these sorts of things and we do our best to try and prevent Things from getting out of hand but that's a problem we just have constantly with our readership because We do have a significant overlap with the conservative audiences And especially some of the more old school conservatives have still not kind of come around to As you and I have with the restraint school with the realism, they're still heavily even among conservatives Just all these notions of international liberalism and humanitarian interventions and the us is Shining city on the hill and all of that stuff that old stuff dies hard And from what i'm seeing it's at least among the the older age cohorts hasn't gone anywhere Given the amount of criticism we get anytime we run an article at mesas.org promoting peace instead of constant escalation, but With that we better wrap up this episode here of or economy and state Thank you. Zachary for joining me again this month We'll be back next month with a new episode depending on whatever's going on then and so we'll see you next time