 Hey everybody, today we're debating socialism versus capitalism and we are starting right now. With our guest, socialist guest, Dr. Ben Burgess with his 20 minute opening statement, the floor is all yours. Thanks Ben. All right, thanks James and thank you Dr. Friedman for agreeing to this. I watched your discussion with Richard Wolf last November and you mentioned a couple of historical trivia during that debate that I've never heard before and now that I know it, I thoroughly enjoy knowing it and that's that pirate ships were essentially floating worker cooperatives with the pirates electing their own captains. This is now part of my standard spiel about socialism. I'll say we need to establish workers control the means of production, you know, like pirates and that of course brings us to an annoying terminological issue that we need to clear up to have an interesting debate. What does socialism even mean and how would it be different from capitalism? Capitalism is that term has mostly been used since Louis Blanc, invented in the mid 19th century, refers to a system where some people are capitalists, in other words private owners of businesses and they get to lord it over all of the people who have no realistic choice except to submit themselves to the rule of the first group in the workplace. At least as I use the term socialism means an economic system where things like factories, farms, banks, grocery stores are socially owned rather than owned by capitalists. For the sake of simplicity, I'll be referring to all that stuff as the means of production, although it also includes of course means of extraction means of distribution means of exchange and so on. So social ownership can take a few different forms. If you have political democracy so that the state is socially owned, state ownership can be one form of social ownership, but a private worker cooperative is also a form of social ownership. The important thing is that democracy has been extended into the economic sphere so that for the first time since the agricultural revolution, we can achieve human societies that aren't divided into a subservient labor force and some sort of ruling class. Historically, socialists have disagreed with one another about quite a lot. Some, for example, have thought that the best form of socialism was one where the state owned every economic enterprise. Others going right back to the very beginnings of the socialist tradition to people like Bikunin have actually been anarchists who didn't think there should be a state, but however much socialists have disagreed with each other about, they've all agreed that the goal should be a society with some form of social ownership so there wouldn't be a class of people who own the means of production and a class of people who had to put themselves under the thumb of the first group in order to make a living. So what could feasible socialism actually look like? Well, there was the Soviet Union, of course, and other societies organized in the Soviet model in the 20th century, but there are multiple problems with that model. Most obviously, it lacked political democracy, so state ownership of the means of production didn't translate into democracy in the economy. But also, Soviet style planning was, as my friend Baskar Sankar describes it, all thumbs and no fingers. Very good at churning out tractors and tanks very quickly, and thank God for it or else the Nazis might have won World War II, but very bad at coordinating production with consumer needs, which is a big part of the reason that so many of those societies either collapsed in the late 20th century or like China reformed themselves into some sort of semi-capitalist hybrid. So even if that experience is mostly a cautionary tale, we still have plenty of models of successful socialization, at least of parts of the economy. We know from the experience of many advanced Western democracies that have successfully run these experiments over the course of several decades that state planning does actually work extremely well for at least some sectors, like healthcare and education, where it's perverse and socially destructive to treat these things as commodities to be bought and sold, rather than treating them as things that everyone has a right to, funded by progressive taxation and free of charge at the point of service. I would argue that the so-called commanding heights of the economy, like banking and energy, should also be state-owned, although in all cases I'd like to combine that with some degree of workers' control at the workplace level. And if we still need market competition between autonomous firms in order to produce the sort of consumer goods for which calculation problems seem to be the biggest issue, that market sector can at least be made up of worker-owned firms. And this vision can't really be objected to on the ground, so run afoul of coordination problems or anything of the kind. We just have too much empirical evidence from too many countries that it's possible to nationalize parts of the economy without economic catastrophe. Indeed, we'll get in better results in important areas like healthcare than more pure free market systems. And we have too many examples of wildly successful worker-owned firms, like the Mondragon Corporation in Spain, for it to be possible to seriously argue that private firms can only function well when they're owned by individuals or partners or stockholders, rather than when they're collectively owned and democratically operated by the workers themselves. Of course, I know that Dr. Friedman doesn't object to worker cooperatives when they arise within the rules of the free market. The same way, even a divine right monarchist doesn't object to a democratically elected parliament making certain decisions as long as the king chooses to convene that parliament and grants it leave to operate within those spheres. What a monarchist and a small R Republican having the 18th century equivalent of this debate would really be arguing about is not parliament's ever acceptable or not, it's whether the people need the king's permission to rule themselves. By analogy, what socialists and libertarians are arguing about is property rights. In other words, whether it's okay to bring about the social ownership of the means of production by taking businesses away from their current owners in order to either bring them under state ownership or convert them into worker cooperatives. And that's the real issue. Now, you could say if worker cooperatives work as well as I think they do, why wouldn't they just become the dominant economic forum through market competition? Well, a couple reasons. First, regular capitalist companies do have some competitive advantages over worker cooperatives, just as slave plantations had some competitive advantages over farms where cotton was grown with free labor. If you're paying people poverty wages, that frees up a lot of money for new expansion. Worker cooperatives where pay scales are decided on democratically do still expand, but they might do so more slowly, balancing this priority in a more reasonable way with the present day well-being of existing members. That said, the existing empirical literature does seem to consistently show that once worker cooperatives are founded, they last about as long on average as any other firm. In fact, they may be more efficient in some ways since elected managers don't need to crack the whip in quite the same way that managers do in firms where people are working to enrich someone else. So the problem isn't so much that they have a higher death rate than any other company. It's that they have a much lower birth rate. And that's true for at least a couple of reasons. First and most obviously, the distribution of starter capital throughout the population is wildly unequal. Working-class people applying for new business loans from banks really are at a much greater risk of not being able to pay it back. Secondly, a cooperative can't reward investors with an ongoing ownership stake without, to that degree, ceasing to be a cooperative. Realistically, there's just no way the cooperative sector is ever going to become a really significant chunk of the economy. Never mind swallowing up the entire private sector like I want it to through co-ops playing within the rules of the capitalist game. In order to get what I want, and I think this takes us to the real core area of disagreement, you have to set fire to the old game board and start a new game with new rules, socialist rules, perhaps rules where the system for new firms getting their starter capitals that they get grants from nationalized banks and businesses are only eligible for those grants if they're under workers control. So that's really the question in dispute, I think, between me and Dr. Friedman. Not a question of whether the forms that I like can exist if they arise within the rules of the capitalist game, but the question of whether we should switch to a new socialist game in which what's currently the dominant form would be consigned to the dustbin of history. I want to switch to a new game and he wants to keep playing. In fact, he wants to play a purer form of the old game without the statist elements that currently sand off some of the existing system's most brutal edges. And that's where the pirates come back into the picture because a lot of times the way those floating worker cooperatives came into existence was when crews of regular non-pirate ships would mutiny against their old captains and take over the ship. Now, all joking aside, I don't want to romanticize pirates too much. They made their living through violence. And while I'm not an absolute pacifist, for example, I think the people of Chile would have had every right to use violence to resist the fascist coup that overthrew the democratic socialist government of Salvador Allende in 1973. I certainly don't like the way those mutinous crews had to make a living once they could no longer operate within the legal economy. But for the mutinies themselves, I have nothing but sympathy. Whether we're talking about naval ships where the mutineers were conscripts or regular merchant ships where they were essentially economic conscripts, too poor and desperate to turn down the deal, even though that deal meant they had to endure an absolutely brutal form of petty tyranny at sea. So following the thread of this imperfect but suggestive analogy, what is it that I think would justify a society-wide mutiny against capitalism, even though within this metaphor, when I say mutiny, I would hope that would take the form of a peaceful and democratic transition to socialism. In other words, what's so bad about the game we're playing right now that's set in fire to the board would be justifiable? Several things. Starting at the top, the most obvious surface level problem, which is a big problem, is the grotesquely unequal way that the game we're playing right now distributes resources. Some people own multiple mansions and some people sleep under bridges. Pharma executives enrich themselves while diabetics literally die because they're medical go fund me's don't bring in enough money fast enough to buy them insulin. And if there are places in the capitalist world where those things don't happen, or at least they don't happen as much as they do in the United States, that's precisely because of statist intervention and labor union intervention to stop the game from being played in nearly as pure form as we play it here. Now, some libertarians try to claim, I'm sure Dr. Friedman would be above this argument, but some libertarians will claim the left's dislike of extreme economic inequality is about jealousy. This is nonsense. The reason that we don't like economic inequality are first because at least given the backdrop of a growing economy, this stuff really can be a zero sum game. Some people having more means that others have less. And if some people have so much more that others aren't having basic human needs met, that's a problem. Another problem is that economic inequality has a corrosive effect on democracy. If Jeff Bezos calls the senator's office, he will speak to the senator. If a worker at one of Bezos's sweatshop warehouses calls the same office, should be lucky to speak to an intern. Some Americans are provincial enough to believe that campaign finance reform will solve this problem, but it won't. Extreme concentrations of economic power always find ways to translate themselves into concentrations of political power. The kind of social society that I described wouldn't necessarily have a perfectly flat income distribution any more than you have totally flat pay scales. It actually exists in co-ops like Mondragon. You can pay some people more than others for the sake of incentives to do more work or less desirable forms of work or they have incentives to acquire certain valuable technical skills, for example. But when the workforce as a whole gets to vote on the pay scales, those pay scales are way more egalitarian comparatively speaking than what you end up with at a regular capitalist firm. Another problem is automation. Advancing technology should be good news for everyone, but under capitalism it isn't. If a capitalist company comes into possession of labor saving technology, meaning it only takes half as many people working 40 hours a week to get the same result, they have an incentive to lay off half the workforce or cut everybody down to half time. If a worker owned firm is in the same situation, they have an incentive to vote themselves a 50% reduction in hours at the same pay, especially if they're in a sea of other worker cooperatives rather than having to compete with regular capitalist firms. Another problem, you know, and even if you're lucky enough to end up with another job that's still a lot of disruption and avoidable human misery. Another problem is alienation. If you have to spend half of your waking hours five days a week, and it's only half and only five because of past worker struggles, performing tasks that you have no voice and setting enforced by managers, you have no voice and choosing that leads to a lot of avoidable suffering and avoidable disconnect between, you know, how people are spending them time and what they have to do in order to make a living. Another problem is exploitation, which is the private sector version of taxation without representation. In any system, people aren't going to get every scent of the fruits of their labor. Some of it has to go to repairing old machines and buying new ones, for example, but under capitalism, people have very little say in deciding how the fruits of their labor divvied up. You know, people who did very little to create it still award them can award themselves huge slices of pie due to their structural position of economic power as business owners. Another problem is regulatory capture, as long as you have a class of wealthy business owners that exert disproportionate political power, any state regulation you set up to try to stop environmental catastrophes caused by their business practices or protect workers from labor law violations or wealth, et cetera, is always vulnerable to being captured by exactly the interest those regulators supposed to be policing in the first place. And that's true even given the combination of capitalism and a democratic state, never mind they truly nightmarish thought of an anarcho-capitalist system where private enforcement agencies would only have an incentive to serve the interests of the private companies that cut their paychecks. But the biggest problem is the problem of authoritarianism. Some people think that the more cynical your view is of human nature, the more you should like capitalism and dislike socialism. It's a very popular idea, but I think it gets exactly backwards. I think that the less you trust any human being to exert power over any other without abusing it, the way that Bezos abuses the workers in his warehouses or Harvey Weinstein abused actresses, the more reason you have to support an economic system where power is distributed as evenly as is reasonably possible. That means supporting extending democracy into the economy. Now, I know that Dr. Friedman is a consequentialist. He thinks the justice is just a matter of what promotes the best consequences, the most flourishing. Okay, well, we'll get a correction when it is his turn. And I'm sure we'll get the nuances of his version of consequentialism then. And so I will save my objections to that view for after we hear that. But here's the point, here's the larger point, that on some forms of consequentialism, you could justify things that I would really disagree with. Even if we had a subservient working class that only made up a tiny minority of the population and everyone else benefited, I would be here advocating for a classless society anyway for all sorts of other reasons. But in reality, what the situation that we have is a working class majority of society getting the short end of the stick on economic inequality, the short end of the stick on workplace authoritarianism, and the short end of the stick on many other forms of avoidable human misery. So I would argue that even in crudely consequentialist terms, never mind what I'm sure will be the beautifully nuanced version that we'll hear from Dr. Friedman, the crew of this particular ship has every right to mute me. Thank you very much. We will kick it over to Dr. Friedman for his opening statement and want to remind you folks, our guests are linked in the description. I encourage you to check out our guest's links so that you can read more, hear more from them. And so we will kick it over to Dr. Friedman for that 20 minute opening statement as well. Dr. Friedman, thanks for being here on the floor is all yours. Thank you. We start with a problem which I anticipated correctly, and that is that neither capitalism nor socialism has an unambiguous meaning. And therefore there is the possibility that I will end up arguing for something that is not what Ben calls capitalism. And he will end up arguing something that's not what I would call socialism. Though I would have to say that when he's arguing for his closer to socialism than it could have been. So in that sense that may be less of a problem. But I thought that the simplest thing would be if I explain what I meant by the terms, he I think has explained it. Well, he hasn't really explained what the defining features of capitalism is, but he's explained what he's in favor of. And we can then see whether I can argue that what I am defending my version of capitalism is more attractive than what he is defending his version of socialism. So what is capitalism? Capitalism is a system of institutions in which human actions are coordinated by voluntary exchange within a system of private property and trade. And if you look at actual modern developed societies, none of them are either capitalist or socialist. That is all of them have a mix of institutions. That if I take the US, which is the one I know best, food and cars are primarily produced under the capitalist rules of the government affects it a little bit. On the other hand, K through 12 schooling, the military courts and law enforcement are all socialist institutions, even though people don't usually put it that way, because they are all examples. There's some private schools, but most of K through 12 schooling is run by local governments. So if we think of the traditional definition of socialism as government ownership and control of the means of production, which I gather is at least included in Ben's, although it's not his only thing he includes, then those are socialist institutions. Medical care in the US is about half of it is paid for by governments. And the other half is a heavily regulated private industry. So it's actually a mix of the socialist and the capitalist approaches. I usually start out with the empirical evidence. And I'm afraid I'm not really supposed to rebuttal at this point. So I'll continue this, but the the empirical evidence we get not by comparing a capitalist society to a socialist society, because I have neither examples available to look at, but by comparing societies is otherwise similar, one of which is much more socialist or much more capitalist than the other. And we have a convenient set of examples of that nice control, not quite controlled experiments, but as close as you can hope to get in this context. We have East Germany and West Germany. And it was East Germany that had to build a wall to keep its citizens from leaving. We have South Korea and North Korea, which is a similar situation where North Korea is desperately poor by comparison with South Korea. And we have, perhaps most interestingly, the multiple China's. We have Maoist China, which you can compare to Taiwan, Hong Kong and Singapore. All three of those were enormously more successful societies for their population. And all three of them were under physically less favorable circumstances that Hong Kong had about, at least when I looked at the numbers quite a while ago, Singapore had the highest population density of any country in the world. Hong Kong, which was not a country, had 10 times that density. So China has a huge population, but it's also a huge country. So in just material terms, China should have done better. In fact, Maoist China was desperately poor, had famines with tens of millions of people dying, and the other three were all relatively prosperous society. But we also have the comparison between Maoist China and post-Maoist China that when Dan was told that there was a serious problem with people running away to Hong Kong, his response was not, let's put in more troops on the border, but what can we learn about what they're doing so we can do our system better. And the result was that although China is still not a free or a democratic country, it is somewhat less capitalist in the US, but enormously more capitalist than Maoist China. And that change resulted in an increase in per capita income of the Chinese population of well over an order of magnitude. It's probably the largest single change in human welfare as a fraction of the world's population that has ever occurred. Let me go on, however, to the theoretical case. Why do I think that capitalism is a better system than the alternatives? All societies face what economists call the coordination problem, that in order to do anything in a moderately complicated society, you somehow have to coordinate the activities of a very, very large number of people. This classic example is to make a pencil. You need wood to get wood. You need chainsaws to get chainsaws. You need steel and gasoline and copper for wiring and a bunch of other things. Trace all of the things down to their causal chains, and you're talking about probably hundreds of thousands of people coordinating their activities. Some way you have to make sure that there is enough wood cut for the pencils people want to make and the houses they want to make and the other things they want, furniture they want to make, enough chainsaws to cut that amount of wood and so forth. If you think about this problem seriously for a few minutes, your first conclusion must be that we're all dead and this is a dream, because it's very hard to see how you could coordinate that complicated a problem and make it all fit together. And there are basically two solutions to that problem, which are very generally speaking, one of which doesn't work. The one that doesn't work is the obvious solution, and the obvious solution is you have somebody at the top telling everybody else what to do, figuring out what to do and making them do it. That is workable on a small scale. If you think about a football team, maybe, or a small firm with a half a dozen employees run by its founder and owner, but it scales very, very badly. As the hierarchy gets larger, it becomes harder and harder for the person at the top to know what people at the bottom are doing or what they should be doing or whether they're doing it. And you have the additional problem that it's not at all obvious in general that the person at the top has the right incentives that he wants to achieve his own objectives just like everybody else, and it's not immediately clear how you make it in his interest to do what achieves the general objective. The alternative solution is decentralized control, and you can start out by imagining the easy case, which is a non-interdependent society, where everybody is his own little farmer out in the woods or something, and each person knows what he wants, he knows what resources he has, he controls himself. Each person therefore maximizes the sum of his benefit minus his cost that maximizes the sum of everybody's benefit minus everybody's cost problem solving. The question is how can you get the equivalent of that neat and tidy solution in interdependent society? And the answer, a complete answer to that question I'm afraid requires about a semester of price theory. I could offer you a book that I've written which I think is more fun than that semester but does the same thing, but I think I can at least sketch how the market system solves that problem, and the coordination is by prices that when I want to produce something, the prices I've got to pay for my inputs reflect what I've got to pay somebody else to produce them, or somebody else not to consume them, if it's something I'm bidding away from someone who would consume it. The prices that I receive for what I sell are a measure of the value to somebody of that something, so that means that my profit is the difference between the value of what I do and the cost of doing it, and it is in my private selfish interest to maximize that profit. None of this happens perfectly. There are a list of problems that economists generally refer to as market failure, a misleading term because the same problem exists in lots of contexts other than markets, but basically they all involve situations where somebody is making a decision where either he doesn't bear most of the cost or he doesn't receive most of the benefit, and if I am making a decision where I bear the cost and other people receive the benefit, I may not make it even though benefit is larger than the cost, and if I'm making a decision where I receive the benefit and other people pay the cost, I may make it even though cost is larger than benefit. That's the underlying problem of market failure, and it's the reason that my ideal less-a-pair capitalist society works less well than a planned society run by an omnipotent, omniscient, benevolent ruler. We don't have any of those. Let's consider the alternatives, and socialism, as I generally define it, I suspect what Ben is proposing is in the sense a mix of the two, like most systems, but socialism is a system where the allocation of resources is controlled by political mechanisms. The traditional economic definition is government ownership and control of the means of production, and there are no pure socialist systems in that sense, just as there are no pure capitalist systems, even in the Soviet Union under Stalin, there were lots of individual decisions such as what are we going to have for dinner tonight that were made by individuals, not by the state. I think people even got to decide who they would marry, although that's clearly an important part of the means of production, since after all, your society needs people, but some systems are much more socialist than others. Let me make what I think a general point, which is not limited to arguments on capitalism and socialism, but applies there as well. That is that it is not legitimate in your argument to specify the outcomes. You have to specify the institutions and then show the outcomes you want will occur. For example, I don't get to specify a capitalist system where all the rich people are generous and they solve the problems of poverty by giving lots of money away, unless I can show a reason to expect that to happen. But similarly, you don't get to specify a socialist system that helps the poor. We know that in fact governments quite frequently transfer up the income scale rather than down, that public school, public universities, state universities are heavily subsidized, and they are on the whole used by the children of the top half of the income distribution out of the bottom half. The most striking example of this that I encountered was India. India has been an officially socialist state from the time the state of India was created, and when I visited India, my impression was that it looked to me like a socialist description of the horrors of capitalism. I gave a talk in a business school. It was inside a beautifully landscaped, forested, open area, maybe, I don't know, a half a mile aside, quarter a mile aside, I didn't measure if it's something on that scale, surrounded by a high wall with barbed wire on top of it to keep out the population. That was the actual outcome of a system that regarded itself as socialist, was run by people who call themselves socialists, and nonetheless ended up with massively more inequality than, say, Hong Kong or Taiwan or other developing and developed countries that they didn't have that view. So the claim I'm going to be arguing is that not that my system is perfect, but that a realistically imperfect version of my system is superior to a realistically imperfect version of yours. I enjoyed looking over a bunch of Ben's webbed stuff. Neither of us likes culture war very much. We have both been mistreated by Facebook. Facebook has for a while told anybody who tried to link to my web page that it was inconsistent with the web pages, I forget the term they use, but community rules or something. Mostly people were linking to material on medieval cooking, and I never quite figured out how that was inconsistent with the social rules. The Facebook and they never told me, and eventually they stopped, and I gather that Ben had a somewhat similar experience. But on the other hand, when I looked at where Ben went from that, what he said is it's a good thing if we have not only First Amendment, but also diversity in opinions in general, and it would therefore be better if Facebook did not try to censor opinions, a view I happen to agree with. Buddy then said Facebook has enclosed the commons, and the solution is to nationalize it. The solution is that the government should be running Facebook and all of its competitors. And it doesn't seem to have occurred to him that governments also have things they want people to say and do and believe that indeed a government has much stronger incentives than Facebook does to try to control the conversation because much more of conversation that could happen on Facebook is relevant to Republicans and Democrats and progressives and all the rest of it than is relevant to people who do or don't like Facebook. And furthermore, that a government which controls all of the media has enormously more power to control things than a bunch of firms, even some very large firms, each of which controls a piece of it. Because in fact, Facebook has not enclosed the commons. If it enclosed the commons, we wouldn't be here. The relevant space, the equivalent of property for growing land, includes where my blog is, where Ben's blog is, and where this debate is happening. So what has happened is that Facebook has managed to persuade very large numbers of people that the most interesting way of communicating is to use Facebook. On the whole, I could think of better places to do it, and I in fact do a larger part of my communicating on a couple of blogs. It used to be Slate Star Codex and now it's its descendants, but where Ben would I'm sure be welcome and would probably even have fun. But it is, you know, might be better if Facebook behaved itself better. But it strikes me as an almost classic example of setting the fox to guard the chicken house to say that the way to have diversity of opinion is to have a monopoly state control over them. I should say we even have a little evidence on this subject because there was a time when the media as it were, large chunk of the media, were in a sense under government control. That the standard rule for the FCC for quite a long time was that if you wanted a radio or television license, you had to get it from the FCC and the FCC had to decide whether you were a responsible contributor to the public discussion. And if you weren't, if you were, you know, polluting the the discussion as it were the same kind of conversation we have now where you didn't get it. And a radio or a television license was worth a great deal of money. Lyndon Johnson's fortune was made by his wife running television in a market under regulation at a time when he was one of the most powerful people in the Senate. And if you have a multimillion dollar license, you are going to be very careful not to offend the people who control it. So we actually have evidence of how governments that have control, partial control, fortunately, behave. And that was a democratic government, just like the kind that he said that he's in favor of. Let me go on to another bit that I thought was interesting, and it struck me in particular because it started out with a comment on a book my parents wrote, Free to Choose, and he correctly quoted them or summarized them as arguing that voting with dollars made more sense than voting with votes. And then I couldn't figure out if he misunderstood them or was just criticizing progressives who were taking that argument in the wrong direction because he says correctly, he's now imagining that you're using those dollars to make companies follow policies that you approve of, to make general mills pay higher salaries for its workers. That wasn't quite his example. That was what he was implying, I think. And he correctly saw that when you decide what cereal to buy, the question of how does general mills pay its workers is not going to be one of the major considerations. The question is going to be to my kids, like it? Does it taste good? How expensive it is? That sort of thing. That's right. But you are getting a vote on what kind of cereal general mills makes. The vote on having, on paying wages isn't going to you. The vote on paying wages is going to the workers. The worker does or doesn't accept the offered general mills makes as opposed to alternative offers. The result of that, despite socialist and liberal talk about starvation wages and living wages, as Ben may know just at the moment, the average per capita real income in the U.S. is roughly 30 times what it was globally through most of history. So it is certainly true. It will be nice if everybody was richer than they are. But the idea that somehow the only reason people get paid money is because of the way the starve to death is just wildly inaccurate. We know that only one or two percent of the population actually get the minimum wage. That companies are hiring workers in a competitive market. And if your company treats workers very badly, it will find that in order to get workers who could otherwise do somewhere else will have to pay them more. So that in fact, the voting with the dollars is happening on the consumer's side and determining what companies produce and on the producer's side and determining what terms they have to offer in order to get workers. So as Ben clearly realizes, I would argue for a much more capital system than we have. I don't think we've got time to go into the details of people are curious. The second edition of my first book is web for free as a PDF on my web page. And in that, I sketch what a society might look like in which was entirely private in which all government, all useful government functions were replaced by private institutions. I think that's my 20 minutes. And I think Ben gets to read that. You bet. Thank you very much, Dr. Friedman, for that opening statement. Want to let you know, folks, if it's your first time here at Modern Day Debate, we are a neutral platform hosting debates on science, religion and politics. No matter what walk of life you are from, folks, we are thrilled to have you here. We're going to go into the rebuttals now. So I've got the timer set for you, Dr. Burgess. The floor is all yours for 10 minutes. All right. Thank you, James. Thank you, Dr. Friedman. So I want to, I think, start at the start where I started my opening statement, which was at the semantic issue, which is not where I like to spend most of my time. I would almost always rather prefer to argue about the things than the words that we used to describe those things. But I do have to say it is just not historically accurate to say that the central historical definition of socialism was government ownership of the means of production. If you think this is the case, it must be very confusing that going right back to the beginning of the socialist movement in the 19th century, you had people like Perdan, people like Bikunin, people like Emma Goldman and Alexander Berkman in the 20th century, people like Peter Kropotkin, people like Vester Makno, who were all anarchists who considered themselves to be socialists. And in fact, historically, most people who called themselves anarchists also thought of themselves as being socialists. I'm pretty sure that's still true globally. I understand in the United States we have people who called themselves anarcho-capitalism, but this is just one of those American extentricities. So I think historically what has been meant by socialism, whether people wanted it to take the form of state ownership, the form of cooperative ownership, some combination of those forms, some third thing, was social ownership was not having a division of society into workers and business owners, not having labor be alienated from capital, which is a defining feature of capitalism. So there was a claim that we hadn't really talked about what makes capitalism capitalism, but certainly not the existence of markets, which they had markets in ancient Rome. I haven't heard anybody refer to that as a capitalist society. It's the fact that the main form of social organization, the mode of production, has been wage labor as opposed to slave labor or surf labor, or as opposed to the kind of genuinely free labor that you get under socialism, where people don't have to submit themselves to the rule of the petty tyrant in the workplace in order to make a living. Dr. Friedman talks about capitalism as a system where human action is coordinated by a voluntary exchange, but just talking about voluntariness is not very informative. I know that Dr. Friedman is a consequentialist of some sort. I still want to hear more about that. But most libertarians, when they talk about voluntariness, this is like a principle for them, that you have to have voluntariness. This is the non-aggression principle. And the problem, of course, with that is it's completely vacuous, that you only know whether something's voluntary when you know how things should be distributed in the first place. I know that sounds like a counterintuitive thing to say, but if you start thinking through the details of these kinds of in principle libertarian views, that is the problem. After all, when they say you can't initiate a force against another person or their property, well, what is their property being? It can't mean against what's legally their property, or you can't say taxation is theft because a certain portion of my income legally the IRS is entitled to. You can't say property that just happens to be in somebody's possession because if so, recovering stolen property would be morally illegitimate and no libertarian thinks that. The only way to make sense of this is by saying that it's truly voluntary if you're not initiating aggression against somebody's stake on the piece of property that they're morally entitled to. And that just brings us back to the question of what counts as a just form of distribution, which is where we should have started out instead of going through this rabbit hole of voluntariness. Now, on the subject of consequentialism, I'm not a peer consequentialist. I worry about things like Judith Jarvis Thompson's example about the surgeon sign up healthy patients to transplant their organs and lead into more people living than not. As I said, even if the situation we were facing was where there was a tiny subservient working class enriching everybody else, I'd still be against that. But I do agree, of course, that looking at the good and bad consequences of different systems and different policies is very important, even if it's not exhaustive of the question of what counts as a just arrangement. So Dr. Friedman brings up East Germany versus West Germany, South Korea versus North Korea. South Korea, by the way, is an interesting example for me because I lived there for three years and in many ways compared to the United States. It felt like a utopia because, for example, I didn't have to worry about health insurance because every single person in South Korea, including people who are there on temporary work visas, gets national health insurance like what they have in other civilized societies. But that said, some of these, I would argue the historical record is a little bit more complicated. We can get into that in open discussion or Q&A, but I don't want to waste a lot of time here because I don't want to divert myself from taking the scant minutes that I have to defend what I actually support, to defend in something that I don't actually support. I will just say, I think some of the history is more complicated. So just to give a small example of that, if you want to talk about the great advances made by Dengas China in advancing human welfare, which is certainly very real, you also have to confront the fact that no society without such an outsized state role in planning the economy despite the market elements has made those rapid advances. Now, no society on the old Soviet model made them either, which might suggest that the magic combination is of state and private elements as closer to what exists in China. And the question that I would ask is whether we can have those economic benefits without the hierarchy, economic inequality, despotism, et cetera, that exist in that model. But he also, he talked about top-down planning versus voluntary cooperation. I think that unfortunately, whereas I'm not a big fan of top-down planning, I like democracy in both the political sphere and the economic one. I'm afraid that the evidence doesn't really support the idea that you can also only have a functional thriving economy without too much top-down planning because we look at something like Walmart, which has a larger internal economy than Sweden does and is entirely run by top-down planning. It interacts with an external market. You can say the same thing about the Soviet Union. Then it looks to me like if we don't like top-down planning, which I certainly do not, I like any element of planning that might exist to be bottom-up and democratic. We have to argue against that in some form other than tyranny leading to economic catastrophe because it does not. I do like what he said about not specifying outcomes that we shouldn't just help ourselves to the assumption things will work out in certain ways. I think that's a good methodological principle as far as is humanly possible. We should try to respect and obviously have to do some extrapolation, but we should try to respect the outcomes in the real world. I did want to make a last couple of points about that in the brief amount of time that I had left. We don't just want to compare relatively laissez-faire systems like the United States with North Korea or Stalin's Russia or what have you. You also want to or, and by the way, India has never not been a predominantly capitalist economy in terms of where most people had to go to work, etc. But you also want to include social democracies, not because social democracies such as Norway, Sweden, Finland, etc. aren't still capitalist countries. They are, but because they do have much more significant aspects of public ownership than countries like the United States. Several of these countries, for example, have nationalized healthcare systems which work marvelously better than what we have in the United States. If you want to talk about people fleeing from East Germany to West Germany, you also have to talk about the fact that once you've got nationalized healthcare systems in Western democracies, people like them so much that even the conservative parties have to pretend to support them or else they would never win another election ever again. Now, I don't want to stop at social democracy because I think that it still has a lot of the problems that I talked about earlier. I would argue there are also pragmatic reasons not to stop at social democracy. Again, we can get into that, but I do want to just briefly address before my time runs out the two points that Dr. Friedman made about articles that I wrote for Jack, because I think it's not entirely a change of subject. I think that this ties in to this question that we're looking at about not specifying consequences. So take the Central Media case that Dr. Friedman thinks that, well, he thinks that it's not enclosing the commons because there's other stuff that's out there. I would argue that even the literal meaning of enclosing the commons doesn't necessitate enclosing every bit of the commons. The fact that it's most of what's used is enough, but is enclosed by relatively few corporations, including the bit we're on right now, which is YouTube. And of course, he says that people choose to use these instead of the others. That's an important point. If we have time, I want to get back to that at the tail end. But as far as the free speech issue, he is quite right that we can look at the history. So in the FCC, that he reviled so much, enforced the fairness doctrine, you had a much greater political diversity of ideas expressed in the public airwaves than you did afterwards. You could only have something like Clear Channel where you have to drive hours in any direction to not get exactly the same lineup. I'm going to give you part of my interruption. Are you speaking? You're muted. Pardon my interruption. I lost track of time. I was suspect that you've maybe, I'll give you a 30 second warning and then I'll give Dr. Friedman the extra kind of time cushion as well. Sorry about that. Okay. Well, I know that he went to, I believe, 7.35. Is that right? Am I remembering that wrong? I've been timing him on a stopwatch and I was exactly 20 minutes. Okay. Well, I went to 7.14. So if you were timing with the stopwatch plus what he did in between, well anyway, regardless, we're just about getting up to the end of the time. So I will just very quickly say this that if you look at what happens in the actual world in the public sector in the United States, free speech is doing vastly better than it is in the private sector. Dr. Friedman mentioned public universities, for example. You cannot legally be fired from a public university for your political views. You could sue them as, for example, when Ronald Reagan as governor of California tried to get Angela Davis fired from the University of California system for being a communist. She, the court successfully resisted that. They later came up with a different pretext. That too was reversed. But this is the kind of protection that people do not have in the private sector. In the private sector, generally speaking, there are no protections whatsoever against that sort of thing. If you brought Facebook and Twitter into public ownership, doesn't necessarily mean you'd have a monopoly because as you point out, these do not between them make up everything. But if you brought these into public ownership, then the First Amendment would legally apply to what happens in there. And historical experience tells us that that is much more effective than relying on the benevolence of private sector owners. I'd like to talk about them with dollars, but we'll have to do that during an open discussion. Thanks for your patience with me, guys. I am able to look back at the stream, though. So that's one good thing is that there's about 13 and a half to 14 minutes or so that I've got. So we'll give Dr. Friedman the same kind of flexibility on that rebuttal statement. And so Dr. Friedman, thanks for your patience. And the floor is all yours. Sure. I don't rely on the benevolence of anybody. I rely on the selfishness of the people running Facebook who want to have lots of customers in order that they can sell advertisements. I ought to say something a little bit about the consequentialist issue because it's a common enough misunderstanding. I used to get accused of being a utilitarian, which in spite of the fact that the index entry entry in my first book under utilitarianism is why I am not. My view is that the arguments for my consequentialist arguments are strong enough so that they imply that almost whatever your moral beliefs are, you ought to be on my side. That is, I think that market systems work much better than the alternatives. They that I do not think that there are clean persuasive arguments that show what moral beliefs are right. In fact, I would have said that Ben demonstrated that point nicely in his brief attack on some versions of libertarian arguments so that I agree with some of the moral intuitions that go into not initiating coercion and so forth. So I think they're overstated for reasons I've discussed in print for a long time, but I don't want to base my arguments on them because I have no way of persuading Ben or anybody else that they're true. Whereas I do have ways in which given enough time I would hope to be able to persuade Ben that he would get more of what he wants with my system than with his. And I think therefore that's a more sensible strategy. Ben's basic proposal, if I understand it correctly, his version of socialism is a mix of state socialism and workers co-ops. And with regard to state socialism, he apparently believes that the American public school system is very well run, that it really does take 12 or $15,000 per pupil to babysit kids and give them an opportunity to learn some things. That the post office, of course, is well run. His basic argument seems to be that he thinks that European state medical systems work better than the US. To begin with, most of the European medical systems are not, in fact, holy state systems. Canada is and Britain is. But if you look at the other European countries, they're in fact a mix of private and public. And the US is certainly not a private system. The US health care is heavily regulated in the private section and large parts of it are in fact public. In fact, I'm over 65. My health insurance is in part public because I get the opportunity to have Medicare. So we don't have that comparison. What is true, it is not true incidentally that the US health care system works much worse. If you really look at those comparisons, they don't show that. What is true is the US health care system is more expensive, quite a lot more expensive than that is an anomaly. And it's an interesting issue. And if we had more time, maybe we could discuss about reasons for it. But I don't think it's true that in general, you have examples of state socialism working well. But you have examples of state socialism not working intolerably badly in contexts where it wasn't the whole system, where people had the option of doing things outside of the state system as well. And where the state system had to get its inputs by buying them on the market, it couldn't simply seize them and so. So I don't think state socialism is nearly as good a system as he believes it is. But let me go on to the really interesting part of his proposal, which is the part which is more nearly defensible. And that's the argument for workers' co-ops. We actually have a real world example, a much better example than Mondragon because Yugoslavia was a communist system based on workers' co-ops. It was not a democracy. And it worked significantly better, I think than Stalinist Russia did, but significantly worse than other countries using a free market system. So I'm glad that Ben realizes that one of the weak parts of his argument is explaining why these workers' co-ops don't already dominate the market. Given that they are entirely legal, some of them exist in various contexts. And he basically has two arguments. The first one I should say I answered almost 50 years ago in print in my first book. These are not new arguments, although they're still interesting arguments. The first one is you don't have the capital. Different industries, different firms vary a whole lot in how much capital it takes, that if you are a computer programmer, for a good deal of programming, you can do the stuff you do with things you already own. I could do fairly high-level computer programming on my desktop. And in fact, startups do exist, and they generally do startup fairly small. Workers, Ben talks about things like slave labor and starvation and such. The per capita real income in the U.S., as I think I've already mentioned, is about 30 times the global average through most of history. If it's really true that workers' co-ops are so much better, so much better that you can rouse people for the mutiny you want. Surely you ought to be able to get at least a few hundred thousand or maybe a few million workers who are willing to live on what I think of as hippie standards of living. That is to say at about half the present consumption standard for a few years. And that would, I did the calculations, as I say, in machinery or freedom, my first book. And that would raise enough money to buy out the physical plans of many, not all, but many firms. Once you have that, presumably, since in your view these systems work much better, they would be in a position to lend money to other workers who are trying to establish other workers' co-ops. So you really, it is certainly true that having people available to lend you money is useful. But I expect Mondragon can probably borrow money on the ordinary capital market. But if they don't, if your system is really a whole lot better, as you seem to think it is, you ought to be seeing a whole lot of it, and more and more. Second argument is, ah, but they have the disadvantage that they can't pay their workers slave wages. Well, if it were really the case that the competition was paying slave wages, where do you think the workers would choose to work? That if it was really the case that your workers' co-op was able to pay $20 an hour to people who are now getting $10 an hour, which I think if you look at the actual calculations for most firms, it's not very believable because profits of firms are normally not nearly as large as the wage bill. But if they could, then they ought to be able to hire away all the workers, and you would then not have a problem. That ultimately, the private firm and the workers' co-op were bidding for labor on the same market. That the workers' co-op has to pay enough to be a better deal than the private firm and vice versa. So I don't think that that is a plausible explanation, and I think the correct explanation is that most of the time the workers' co-op is a less satisfactory way of organizing production, can pay its workers less, and does not provide benefits large enough to make up for that. And there are exceptions, which is why some workers' co-ops exist. And Ben raised the issue of Walmart, which is certainly an interesting issue, and it's a point I didn't get into. The classic work on this is the theory of the firm by Ronald Coase, if you haven't read it, you should. It's a very, it's a famous and useful article, because his basic argument is that there are advantages to both the decentralized market and the hierarchical system, and that what a firm, what happens in the market is that a firm grows to the point where further growth would involve doing things internally that is cheaper to do on the via the market. So I'm not going to try to go through all of that in detail, that would take quite a while. The great thing about the capitalist system is that you have a system where if a firm is larger than that, where a firm is at the point where the disadvantage of hierarchy outweigh the advantages, then it loses money and shrinks or gets replaced. If firms are smaller, they go up. But the idea that somehow the defining feature of capitalism is the separation of capital and labor doesn't make a whole lot of sense, because it's always been true in the existing capitalist societies that there are some people who own their own tools as well as lots of people who don't. Presumably, I don't know if Ben thinks that when I self-publish my books, which I quite routinely do now, whether I'm, am I functioning in a capitalist or a socialist system? I don't know, because I, the relevant capital, the main capital asset, I'm, it's true, I'm hiring Amazon to sell the books for me. So in that sense, I'm dealing, I'm not doing it as employee. I'm doing it as a, as a individual buying services for them. So the other things, Scandinavian welfare states, the Scandinavian welfare states are more, they have, they have greater income transfers in the US, but they are not more socialist than other respects. I think if you actually look at Norway, Denmark, Sweden, I don't know that much about Finland, other than they seem to drink an awful lot from my one visit there, that maybe they needed to keep out the frost, but that, that they are in general countries which have less government regulation of the economy, at the same time that they have a generous welfare, welfare system. And Sweden, in fact, got rich at a time when it was one of the more less-appearance economies in Europe, not one of the less. Oh, since, since Ben is interested in pirates, he really ought to read Peter Leeson's book which is called The Invisible Hook, which is not, I think, a good title, but, but it's a good book and that actually just spends a book explaining how that system works. And it really is quite fascinating. But, and they, I should say the reason they were, well part of the reason they were workers co-ops, I think, is that in that situation, the capital asset which was the ship was a free good. That is, they were capturing ships. When they captured ships, they couldn't sell them because they didn't have legal ownership of them. Apparently the supply of ships was larger than the demand in terms of crews, and that meant that they didn't need to have and didn't have an investor who was in a position where he had to have private property rights. But I want to go back to, to Ben's system because I want to, he's in a sense asked the question that I wanted to ask him like other debate and never did, which is essentially, am I free to practice capitalism in his system? And I think the answer is no. That if I understand him correctly, if I as a worker and a worker's co-op save up some money and I buy a computer and I write a computer program and I decide that in order for me to make money selling that computer program, I need a couple of other people. I need somebody to do publicity and to do various other things. And so I say to you, well, look, I'll pay you so much per, per year if you agree to work for me. Ben's position as best I understand is that I now get expropriated. That I am after all mistreating those poor workers who have agreed to work for me. I don't get to own my, my computer is now a capital asset. It's no longer just for consumption. So that should get, get seized. And so I want to ask the question, which, which I didn't get to ask my own fault of in the previous debate, which is, is workers co-op mandatory? Is it the only way people are allowed to associate? Or are we allowed to obtain property the same way people in your worker co-op system obtain it? I assume the individual workers own their own cars and, and houses and things probably. And are we then allowed to use that property productively as, as a means of production? And can we make a contract for other people, which will, which amount to, to labor contracts? I should say if Ben thinks that America has a subservient labor class, he hasn't talked to very many people in the population since that does not strike me as, as how people that I observe actually act. And redistribution is not a zero sum game. The reason it's not a zero sum game is that it affects incentives. In the limiting case, if you tell me that every time I produce something, somebody will take it away, I won't produce things. That's the extreme case. But it is in general the case that rules for redistribution affect the amount there is to be consumed as well as who gets it. And in particular, in a society, and this is a problem in our society, in a society where the government can redistribute, it pays people to spend resources on trying to control the government to make it redistributed in their favor and to keep it from redistributing against them. And that's an absolute consumption of resources, what we call rent seeking. It's a dead weight loss, which is why part of what I want is a society where there isn't such a mechanism. Anyway, I don't want to go into, into much more details. I was just trying to look at whether there's anything else on my long list of things I wanted to cover. As Ben may know, there actually is an economic literature on doing decentralized socialism, which was part of the calculation controversy between the wars. And it essentially involves the socialist bureaucrats pretending to be capitalists. And the problem with that is why would they choose to, when that isn't the best way of achieving their objectives. But that would be, that would be another long story. I think I've just run out of time. So let's continue this as an exchange. You bet. Thank you very much, Dr. Friedman. And we will jump into the open discussion section. And want to let you know, folks, if you have not hit that subscribe button yet, do hit that subscribe button and that notification bell, as we have many more exciting debates to come. For example, next week, you will see right here at the bottom right of your screen, we are thrilled. It is the first time that we'll have a debate on the controversial topic of the death penalty. So that should be an exciting and interesting debate. And we will go into the open conversation. So thanks so much to our guests. We're linked in the description. And the floor is all yours. Thanks, guys. Yeah. So well, first of all, I just wanted to say that the that the post office actually is a magnificently effective institution. It's certainly there's there's no remote private sector equivalent for a organization. You are aware that the private sector post office is against the law have the express statutes, which forbid Lysander Spooner, who was a prominent 19th century anarchist, started a private post office and was shut down. Yes. But if you look at more recent history than Lysander Spooner, and getting noticed the existence of things like FedEx and UPS and none of these things, they can do package delivery, but not do anything remotely equivalent to taking a parcel from my for taking a letter from California to Alaska. They are not allowed to they are allowed to take a parcel from California to Alaska. And they do. I've used but they don't do it and would have as you are going to to use a metric that you rightly emphasize would have no incentive to do it at anything like as cheaply as as the post office does it with I don't I don't deserve the service to to out of the way rural areas. Yeah, the post office is a magnificent success story for for why do you think that people who choose to live places that are far away, ought to be subsidized to the extent of people who don't. It's certainly possible. I do not know. I think I don't think UPS actually does discriminate in its package prices by how far away you live, but they could. But I don't see anything particularly wrong with it. If you choose to live your life in a way that imposes costs on other people if you want to get your mail then it's perfectly appropriate. You should pay a you know 20 cents instead of 10 cents for your for your. I don't seem to realize that first class mail is illegal for private firms. Switch the goalposts from the private sector would in fact provide the equivalence. The private sector is competing to the to the entirely different claim that it's okay if we had only the private sector equivalence would be okay if they didn't provide that service because it's not one that people should expect, which I take it is conceding the central point. No, the private post office where the private competitors where they are allowed to compete with the post office, compete with it and provide services that at least in my experience are at least as good and is reasonable at price. You are correct that a private post office might choose higher prices for sending mail to more remote places, although I think the evidence of their current package delivery prices suggests that they aren't that that's more trouble than it's worth. But I object to the idea that it is somehow immoral for somebody who chooses to live someplace where they posted where the postman has to spend an hour to get to him to pay a higher price for receiving mail than someone who lives someplace convenient seems to be perfectly reasonable that individuals should bear the costs of their decisions. Okay, but if we're interested in outcomes then this is an extremely good outcome that you get with the public post office that I think that you've granted we would in all probability not get from a private post office. Getting mail in Alaska for 50 cents instead of 80 cents is not an extremely good outcome. Okay, my only desirable outcome for people in Alaska and an undesirable outcome for the people who are paying for it. If you're transferring a dollar to five sector equivalents would put to as many distribution centers and as many out of the way places and that any price difference would only be a matter of 50 cents to 80 cents. All I could say is that I am deeply skeptical of that and I think that the history of privatizations in the real world does not support that. It's your view in general that cross subsidies are somehow virtuous that if I choose to do things such that make delivering a service to me more expensive it is wrong for me to have to pay a higher price for it. My view is that it's extremely good that we live in a society where we have an institution that guarantees that we can get low cost mail delivery across the entirety of the society and that I'm not at all confident that you would have that extremely good outcome. In fact, I think it's very strange to think that you would have that outcome in a society without a public post office. And it's very strange to think that in a market where the socialist institution has made it illegal for private firms to compete, that you can then judge what you would have with private firms, especially when we can observe the part of the market where private firms are allowed to compete and we observe it in that area, they do in fact do the job. But I want to go back actually to the more interesting question, which is your defense of the view that the shortage of workers co-ops in the present society is evidence that don't work for one. I wanted to say one thing which I had wanted, which I didn't say to you in my previous debate and should have, and that is by your predecessor's account, Mondragon is the most striking example that he mentioned of his successful workers co-op. By his account, Mondragon is the sixth largest firm in Spain. So this is such a so much better way of organizing things, that the very best example in the world, given the given the incredibly high barriers that happen to organize worker cooperatives. The fact that Mondragon could grow to that size is an astonishing success story. So I talked about several of them in my opening statement. You seem to have two responses. So one of them is that starting a new business takes different amounts of capital in different areas, which is undeniably true, although I'm having trouble seeing the relevance, because if we're talking about proportions of the economy, then if there are- Because then all the low capital versions auditing workers co-ops already- If there are lots of places where it's fairly low, lots where it's higher, then it stands to reason that that is something that would drive it down overall, especially given the structural problem about investment that we discussed. And you talked about how if worker cooperatives can have more egalitarian pay scales, workers would choose to work there. But of course, this assumes an economy where you have a big worker cooperative sector. No, it does. Because my entire contention is that in terms of this area is that structurally playing on the rules of the free market game, that it is much easier to organize the traditional capital firm than to organize a worker co-op. No, the name is that the workers co-op is much more attractive. That you disagree with that. But if you're trying to argue against my position, just saying that, oh, people aren't choosing to go work at this largely non-existent worker cooperative sector doesn't do that much. Now, if we had government policy to create a massive worker cooperative sector, then you could have a real test of this. But of course, of course, well, because of all the pediments that I'm talking about, you haven't given any impediments. Well, it is perfectly legal to have a workers co-op. Perfectly legal to have a workers co-op. It is perfectly legal to raise its own capital just like anybody else. It's really a much better system. Really a much better system than the workers you need to provide. There are no structural impediments to it. There could be plenty of structural impediments to something that's not illegal. I gave you several earlier. So you granted that investment was an obvious structural impediment, an obvious structural advantage of traditional capitalist firms over worker cooperatives. You granted that there are areas of the economy where you need more starter capital. And so that's an impediment. Other than impediment, there are areas where you need less starter capital. Other than what you just said. If A is bigger than B, then B is less than A, right? The only response that I heard was that, well, if you had large numbers of people willing to cut their consumption in half, which is, I find frankly bizarre given that we're already talking about a country where you have the people that we're talking about are already in the great many cases living paycheck to paycheck. You mentioned how what a small percentage of people early or early exact minimum wage, which is very misleading because even increasing it to $15 would still be a wage raise for something like 42, 43% of the workforce. That would be fine if wages had kept paced with productivity, in which case we'd be talking about about $25 an hour as the minimum wage. So in a society where this isn't true, in a society where as more and more things- You keep ignoring the facts, you don't have to do all the whole economy at once. Financial stress. In order to do the whole economy at once, you need the government. That it's reasonable. If the workers keep going, they're already in adequate consumption for a few years to get this going, I think it's not plausible or realistic. You're ignoring the fact that in a society which varies a whole lot, if you were right, then those parts of the economy where it's easiest to do, and those are going to be parts of the economy where people are not at very, very low wages and where you don't need huge amounts of capital, then you would see all of those turning into workers' co-ops. Those workers' co-ops could then, if they were persuaded of any of your ideas, invest in other things becoming workers' co-ops, and you'd eventually get it all. A workers' co-op is not unable to borrow capital. A workers' co-op under your institution is unable to borrow capital and share ownership. You can still borrow. There's no reason why a workers' co-op can't put out bonds, agree to pay things under the capitalist system where contracts are enforced against them, just like against anybody else. They could, if necessary, pledge some of their capital goods as security for those bonds. It is true that a workers' co-op lacks one mechanism for raising capital that a private firm has, namely selling stock. Not all firms do sell stock, however. A workers' co-op has the advantage, if you're right, that the workers ought to be enthusiastic. Some of the workers, enough workers, should be enthusiastic about it, willing to cut their consumption or mortgage their house or do other things to raise it, and you have to explain why virtually none of that happens. Well, again, I don't think it's surprising that in a neoliberal hellscape where most people are living under economic precarity, that you don't get what most people live on through most of history, economic precarity. I find it baffling what it is that you think that that stat is supposed to show. You have a variety of places in the world today, some of which, by the way, very much included Scandinavia. This idea that Scandinavia is less laissez-faire is largely false, but they have a win where you have consumption greater than the global average for most of history. But if the argument we were having was which is better, keeping capitalism or regressing to feudalism, then comparison to what existed for most of history would be relevant, since the argument that we're actually having is, is it better to stay with capitalism or to move forward to democracy? The argument we're having is not relevant. Yes, for the majority of human history, you know, most people had, you know, we're living under. The argument we are having at the moment is there was a lack of workers co-ops in a modern society as evidence against your idea of workers co-ops. I'm sorry, I didn't hear that last part. The argument you're having at the moment, you're completely missing the argument. The argument we're having at the moment is whether you can dismiss the lack of workers co-ops as evidence on the grounds that workers couldn't possibly raise the capital to start their own firms. And from that standpoint, it is relevant that current consumption levels are enormously higher than people we've done in the past. And therefore, people who were really dedicated to and willing to suffer for a few years in order to get a much better system, could many of them raise the money? So I already pointed out they could borrow money just like... Well, okay, but first of all, the borrowing money is very far from dispositive in this case, because that was one of the first things that I addressed, that this is actually something that the uneven distribution of starter capital is very irrelevant to because... They borrow money on bonds. They can't borrow money on stock. No, I'm not talking about selling stock at this point. Even before I made the point about selling stock in the opening statement, pointed out that in applying for loans, most working-class people really are a much bigger risk for not being able to repay than people who start out with... We're talking about a loan and firm. And if we're talking about the question of whether or not it is the case, that it is... That it's a realistic expectation that the way that people would choose to transition to this would be to cut their consumption in half. Which, by the way, I just want to briefly point out, is actually a disguised form of voting with their dollars argument. So I hope we get into that, too. But if you're talking about whether that's a realistic expectation, the fact that present consumption is much greater than consumption at earlier points in human history is sublimely irrelevant because for it to be relevant, it would have to be the case that earlier in human history, most people would have been in a reasonable position to do that. If you're not making that claim, I don't see what it has to do with anything. I'm sorry that you do not follow the argument. Let me go back to a point that I wanted to get your response to that I made in my... Sure. I think I followed it, but... That's what I made in my report. And that is, am I allowed to practice capitalism? So you're presented this. So first of all, let me get... So there's no doubt or ambiguity about whether I'm giving you a clear answer. I think that there are people like David Schweikart, for example, in his book After Capitalism, who would say, well, if you have an economy where the dominant form is not wage labor, then any wage labor that crops up in that sense would be truly voluntary in a sense that it would not be right now. So that would be fine. But I am perfectly comfortable saying that it's not the... That just as all civilized societies stop people from either paying below the minimum wage, either by the Scandinavian method through incredibly strong labor unions with vastly more favorable labor laws, or by the American method of having minimum wage laws, just like we stop people from having employment contracts. Where you go under the minimum wage, just as we have sexual harassment laws to stop people from having labor contracts that include you have to accept the sexual attention of the bosses. That we can legally prevent people from having labor contracts, from being economically coerced into accepting labor contracts. They're giving up their democratic role to finish answering your question last day during your last statement. Obviously, this doesn't apply to part-time labor, a few people working part-time, anything like that. I'm sure it would be imperfect and I'm sure there would be gray areas. But it would still be vastly better than what we're having. You're in your system, so any employee who agrees to work for me is doing it because he prefers that to the alternative of your workers' co-ops. So I am not exploiting him or imposing things, and you're simply trying to evade the fact that your system... I'm not evading it. I'm giving you an answer you don't like. It's not a good sign. It's giving me an attempt to defend the answer that you... Without made evasion. So I think that the reason... Because you had unpacked a lot of points, Ben. And so just in regards to those, just to be sure that... I thought I was struggling to answer one question without being cut off. It's true it's been lively. But he stated that I'm not allowed to practice capitalism in his system, although there are some other socialists who would say that I would. Isn't that a correct statement of what you said? So the distinction is if you didn't have economic pressure to accept such labor contracts, why disallow them? And one possible answer to that is to say that if you have... It's the same reason for disallowing labor contracts for sub-minimum wage labor, accepting sexual harassment, etc., which is that the concern would be that if you did allow them, that it wouldn't stay voluntary for very long. That if you have a... Because once you reintroduce it, you've reintroduced exactly the same structural advantages that we were talking about earlier. I know that for some reason that's a mystery to me. You think that the comparison to previous human societies, consumption standards, means that it must be the case that it would be reasonable or realistic to ask people who are living economically precarious lives now to go down to half of their current consumption. But I have to say that some of the people who are presently living the lives they are living would be willing to cut their consumption sharply for a few years in order to get a much better life. Because people do that already. People who go to college and scrimp in order to do that. Lots of people do indeed choose to cut consumption when they need the money for something important. And similarly, I'm not arguing everybody could do it. I'm not arguing the poorest people, your economically precarious people. I'm saying if you really have a better system, then that system ought to attract people away from this system. And the fact that you are unwilling to allow your system to compete, that even if your system is the norm, your view is that mine has to be suppressed, makes it clear that you are not willing to face the actual choices people are willing to make. Anytime they make a choice you disapprove of, now that's economic coercion. We're going to make a choice that's just ordinary coercion. And give you a quick response, Ben, before we go into the closings. But we're basically at the 20-minute mark. So like a really quick one if it's all right. Sure. So again, I'll just say one. This is the vote for your dollars argument. In fact, this is the exact form of the vote for your dollars argument, what with your dollars argument, the Dr. Friedman disowned is irrelevant to the sense in which it's true earlier, is exactly the one that he's advancing now. And second, I would ask him whether and why if he would see a disanalogy between the undemocratic labor contract prohibition and the sub-minimum wage labor contract prohibition or the sexual harassment prohibition, labor contract prohibition. Because to my mind, the questions of coerciveness or non-coerciveness are the same in all three cases. Gotcha. And so we will jump into those closing statements. So I'm suspecting you'll hear the answers to those questions that have been unanswered from either of the debaters during the closing statement. And so we are going to give each person five minutes for their closing statement and then we'll be going to Q&A. So if you happen to have a question, feel free to fire it into the old live chat. And so thanks, gentlemen. That was lively and also want to remind you, folks, our guests are linked in the description. And so we really appreciate our guests. We encourage you. You must love this topic if you're here so you can learn and read and hear more by clicking on our guest links in the description. And so with that, we'll kick it over to Ben for his five minute opening statement. Ben, the floor is all yours. Yeah. So if we're interested in the consequences of different economic systems, then something I've mentioned a few times but is worth underlining and circling now is that you want to look at the consequences not only of the United States and the Soviet Union or these other examples. You want to look at the consequences of relatively laissez-faire forms of capitalism versus social democratic systems that have created the most livable societies. Humans have thus far devised by doing things like nationalizing healthcare as exists as the predominant at least form of healthcare in most Scandinavian societies, having sectoral bargaining, et cetera. And then see how you can build on that by transitioning to an entirely new system. You also want to look at the comparative consequences of working at capitalist corporations versus working at worker-owned firms. Firms like Mondragon have, for example, a vastly lower level of economic inequality. But what I really want to close by getting back to is what Dr. Friedman mentioned at the beginning of his opening statement because when I'm arguing for a society that would take the elements that have been successfully beta-tested in nationalized industries within functioning democratic governments and also within internally democratic worker cooperatives. We look at what worked in the social democracies. We looked at what works in Mondragon, for example. And we say, okay, how could we combine these elements to create a fully socialist society that for the first time since the agricultural revolution wouldn't be divided into a subservient workforce and a ruling class? I know Dr. Friedman doesn't regard employment relations in the United States as being characterized by subservience. All I can say is that I find that incredible. We're talking about a country where people routinely stay in jobs that they hate because they're afraid of losing their health insurance, where you have the proportion of people who say that they would love to join a union is many times higher than the proportion who are, where employees of Amazon pee into bottles because they're worried about not making quotas enforced by omnipresent electronic surveillance. That seems pretty bad to me. Now, why don't people just transition to a better form of society by voluntarily having already an adequate consumption for a few years? And this is where I would point people to the Jack bid article that he mentioned, voting with your dollars as an anti-democratic illusion. I like that Dr. Friedman conceded that voting with your dollars is good for getting the kind of breakfast cereal you want. It's not good for changing the wage policies at the cereal company. So for example, two-thirds of the population in the United States support a $15 minimum wage. No amount of voting with your dollars at the grocery store is going to get you that. I think that this argument about how if this were really great, then you would expect people to start voluntarily having their consumption for a few years to achieve it is just an extreme form of the very version of the voting with your dollars argument that he disowns the version that says that you can use this not only to get the products that you like, but to achieve broader forms of social change. We agree that that won't work. So the real question is, can we do the things that will work? And I think both in terms of consequentialism and any more plausible moral theory, we can and we absolutely should. Thank you very much. We'll jump into the five-minute closing statement from Dr. Friedman as well. And so the floor is all yours. Dr. Friedman, thanks so much. I don't want to discuss state socialism because if I understand Ben correctly, he agrees that the full-scale version of that was a disaster. He's arguing for partial versions. He thinks they work well. I think they don't. That could be an interesting argument, but it's less interesting than the argument I'd like to have, which is out about the workers' co-ops part of his thesis. And the response, the first response I have is that if that really is a better way of organizing things, if it can produce goods as good and as cheaply and provide as good terms, at least as good terms or better terms for the workers, then you ought to see a whole lot of it. Indeed, it ought to be the dominant form as it is a legal form in this economy. And Ben's argument seems to be that workers' co-ops don't have access to the capital market. That isn't true. If you start a firm that is organized as a workers' co-op, which is perfectly legal, it can sell bonds. And it's using the money to buy capital assets. It can use some of those capital assets as security for those bonds. It can't sell stock because that would dilute ownership, which isn't part of his system. It has the additional ability that it can borrow money from the workers to the extent that the workers care about it. He missed half of my voting with dollars point, which is that the person who votes with dollars on what General Mills makes is the consumer. And the person who votes with dollars on General Mills' employment policy is the worker. That is to say, General Mills has got to find people who would rather work for them than for anybody else. We have a competitive labor market, which is why very large numbers of people are paid more than the minimum wage. I don't think that it's because the firms do it out of the goodness of their heart. And so the workers' co-ops will be competing for labor in the same market. And if they can offer somewhat better terms to workers, which he claims much better terms to workers because of all the money they're saving through not having to pay bosses, then you would expect that they would be common, especially common in fields that have relatively low capital to labor ratios. And they ought to spread and become very common. And I observe, this is in a sense the telling point, that Ben is not willing to let his system face competition, that he wants to have the government first seize all the property and then forbid anybody else from organizing their relations the way they want to. I can, in the market system, I don't get to enslave people. I don't, in his, well, his system doesn't, although state socialism does. But in the market system, the only way I'm gonna be able to get those workers to work for my firm, my little tiny firm when it starts, is if I can offer them terms they like better than what they would get by joining over his co-op. And if he's not willing to face that, that means he is not, in fact, willing to accept the choices that individual consumers and workers would make. That, again, the, it isn't, the point is not that the workers would form the workers' co-op because they want a socialist society. The point is that the workers would form a workers' co-op, he's right, because they'd like to be paid better under more desirable circumstances. That's a private good, not a public good. It's not a public change. The change to the system he wants would be a side effect of individual workers acting in their own interests, just like individual consumers do. And they are voting with their dollars in this, or with their hours that you want to put it that way, but it's the same thing by what jobs they are willing to take. And the fact that he believes pretty clearly, I assume he believes, maybe he'll change his mind at this point, that in his system people might still do that and shouldn't be allowed to, because he knows that they're making the wrong decision. Seems to me pretty clear evidence that he is, he suspects the system doesn't work very well. Workers' co-ops have some advantages, but they have some fairly sizable disadvantages, which is why they're uncommon. They are less able to hire labor, because when you hire labor, you are in effect diluting your ownership in the workers' co-op, which the workers have. That was one of the problems that Yugoslavs had with their workers' co-ops. They're a little bit less able to attract capital because they can't offer ownership, but they can, as I say, borrow capital ordinarily. But in general, there are reasons why, my favorite system is the pure market one. That's what I'm doing as a self-publishing author. But for reasons coast pointed out, that doesn't always work well, and there are some enterprises which require coordination through some sort of hierarchy. And doing it as a hierarchy elected, if it really worked better, we'd see a whole lot more of it. Uh, my father told me a long time ago that you should not persuade, expect to persuade anybody in one argument. The function of an argument is to give somebody ideas which he may later persuade himself. So I hope I will have a chance to talk to Bannon a year or so and see whether he has modified any of his views. Thank you. Thank you very much, gentlemen. And we will jump into the question and answer. Thanks, everybody, for your questions. Want to remind you, folks, if you have not, check out our podcast. We are on podcast, and so highly encourage you to pull out your favorite podcast app and find us as we've been excited that people have been downloading and so that's encouraging and want to let you know if you're listening via podcast. You can also find our guest links there in the description box for the podcast as well, and we highly encourage you to check out their links. And we'll jump into it with this first question from Jamie Russell who says, What motivates productivity of the people if they cannot build their own business independently with agreed upon wages with laborers? I think that's for Dr. Ben. Got to be for Ben. Yeah, I guess so the so is if the the questioner's claim is that you that you can only get productivity that the only thing that motivates people is is having the ability to to be a to be a boss that that's it. Then that I think then I think they would find the world in which we live deeply confusing because because most people are are motivated to work even knowing that most of them will will not not be able to do that. You have a certain percentage of the population that will that will try to do that. But but you also have have massive have massive chunks of the of the population who don't you have in places like the Bass Country in Spain. You know you have you have plenty of people who are motivated to to work at Mondragon the the Italian examples you know that are similar etc. including lots of technological innovation. You know that that happened that happened in those places. So I just say that the that I reject the premise of the question. Let me comment on the question too. That many people will work for other purposes. But there will be some people who have an idea who say here is a way we could do something that's not being done. And it is going to be a good deal harder for them to do to achieve that. If the only way of doing it is to talk a 500 or 1000 other members of their workers co-ops into trying their idea. Then if they also have the option as they do I mean they could they can do the equivalent of that in our system by talking the firm into it. But that they that your system rules out the option of saying I'm willing to bet on my idea I'm going to start a little firm. If I'm really lucky I'm going to end up as a Bill Gates or something. Maybe I won't. But you think about how restaurants are started and things of that sort which are on a much smaller scale. Those are a case where somebody thinks he's got something he wants to do and he can do it. He can't do it all by himself. He's got to hire people. And in your system he does not have that option. Next up you still have the option of starting a small firm. You just have to give the other people where there's time for a firm full time the vote. So if your dream is to have a particular kind of restaurant you can do that. If your particular dream is to have that particular kind of restaurant and be a tyrant within its internal structure then I have bad news for you. And if your dream is to have a particular kind of restaurant under your system as soon as you've hired two people those people can then change what kind of restaurant it is because you don't own it even though it was your idea that you created it. Yeah if you think that having two people convinced that you have a good idea is an impossible bar then yes I guess they would be out of luck in this business. No no they have to stay convinced and you've got to make sure that everybody else you hire is convinced because they can always take it away from you if they wanted your system as long as they can get a majority. I'll give you a pithy response if you want Ben and then we've got to go to the next question. Let's go to the next speaker. It is a disadvantage of democracy over dictatorship that you have that you have the danger of being overruled still unfathomably better for human welfare. It's not dictatorship because the other people don't have to keep working for you. So it's a dictatorship that allows immigration is not dictatorship. The system of government by which restaurants are currently run forget about the employees just think about the customers for a moment is if you wish a competitive dictatorship that is to say I have no vote on what's on the menu and an absolute vote on which restaurant I go to and what I buy there and that is a system which empirically works enormously better than having a population vote on what we should have for dinner. And of course really super pithy and they're going to go to the next one. Go to the next question. Right. If you think if you think that the next question we'll get out of control that a boss has over your life will give you a only equivalent that exit would be good enough but just as most people would prefer having democracy within a country to having a system of dictatorships that they can freely move around between. Okay. We must go to the next one. It's I need pithy. I hate to jump in on you but next one from Brathwaite says people never get the definitions correct in Marxism the worker owns the right to the value of the goods they produce not the fine answer. I guess I don't quite get what that's directed against. I don't think it's a question. Oh good. Yeah I wasn't exactly sure what the point was either but Brent and Langell we have confidence good to see you Brenton says China's famines were not due to socialism they were due to the CCP believing USSR propaganda about trofim Lysenko's ineffective farming practices. I don't I don't think that's in fact the case the big famine was the great leap forward famine and that was one in the case of the Soviet Union during the Ukraine famine the Soviet Union was exporting wheat it was in fact if you work if you believe their statistics exporting an amount of wheat that would have fed everybody's start I think it was also true of China as well though I am not positive that what was happening in China was not Lysenkoism they did lots of stupid things like killing all the sparrows when they thought sparrows were a problem but basically what happened was that it was a system that was producing much less food than the local officials said it was producing because every local official had an incentive to lie and make it look as though he was doing well therefore they had goods to export and Mao wanted the foreign currency for things that they needed to buy and in that system the workers didn't have the option of refusing it was a slave system and the eventually about 30 million people starved so I don't think it had anything to do with Lysenko although that certainly didn't didn't help anything and in general Mao was not an admirer of Stalin I should say one of the things that people didn't get wrong which Coase's final book which is a very interesting book was on how China went capitalist and one of the points he makes was that Mao did not believe in centralized authority he believed in a decentralized version of socialism although it was decentralized to the level of very large units still and that what actually happened in China under Mao was that it was going back and forth between failed versions of decentralized at which point they switched back to more simplest and then failed versions of central very interesting book incidentally done thank you I think I think I could do this in about three sentences the Great Leap Forward happened because of a lack of democracy there's no way they would have stuck with that policy if the peasants could vote Mao out of office which goes to why democracy and not just freedom of exit is important I like it so much I wanted in the economy Next up thank you very much for your question anti-Kathira says I think they're saying FB if they mean Facebook FB product is users' attention sold to advertisers okay yep Facebook Burgess Dr. Burgess and you're in our cognitive system are no okay sorry guys I butchered that one you're saying that the anti-Kathira mechanism is asking questions so that's really early AI basically what I meant to say is Facebook product is users' attention sold to advertisers bugs in our cognitive system are exploited by Facebook resulting in warped reality bubbles that threaten society writ large can each discuss WRT capitalism socialism in regard to capitalism oh thank you appreciate it yeah that's what WRT means the you know I guess I would have said that with the clearest case is state socialism versus capitalism it's less clear in Ben's system and that is that in the capitalist system the decisions you make are mostly decisions where you get the consequences if you choose to work for an employer who treats you very badly you will have an unpleasant employment if you choose to buy food that doesn't taste good you will eat it so as a general rule in the capitalist system you have an incentive though not a perfect incentive to try to get accurate information compare that to a political system where if I vote for the wrong person the chance that that will determine the that will result in that person getting elected is something like one in a million or one in two million in the country the size of this if somehow I make the right decision that will produce a large benefit that is shared benefit shared with 330 million other Americans so in general in the political mechanism individuals do not have an incentive to behave rationally when it costs anything whereas in the private one they do have such an incentive which does not mean they are perfectly rationing now workers co-op is going to be in between because in the workers co-op when I as an individual I'm trying to decide should I vote for buying that new gizmo that they say we'll let us where our workers co-op produce stuff better I now I'm in a much smaller polity than the US and if the workers co-op is eight people that's probably going to work pretty well because I'm going to say yes indeed if I figure it out and a couple of my ladies figured out we'll get it or not get it and if we make or lose money as a result we'll all be better off but if you're talking about a workers co-op of 10,000 or 50,000 workers co-op equivalent of Walmart say which would be a good deal bigger than that now each worker knows that he has very little incentive to get well informed and therefore is likely to be more irrational so I think it's a problem exists in both it is a problem which is much worse in the state socialist version and somewhat worse in Ben's socialist version Thanks so much Go ahead Ben So the original question I thought was about Facebook and the things that they do to make their product more addictive which and I would say that if we have a collective ownership of social media companies then that usefully removes a lot of those incentives that's one good reason to do it another good reason to do it is to protect users free speech because the incentives that the current owners have to do that are clearly not working out as predicted whereas we can look at the actually existing public sector and see that free speech is vastly more secure there right now than it is in the private sector if you work for a public university somebody fires you for your politics then you can take legal action and get your job back if you work for a non-unionized private firm and the same thing happens to you by and large you are out of luck But if somebody doesn't hire you if you're a politics you have no recourse in practice and that is a normal situation in both the private and the public universities I am afraid But Well there is a germ of truth to that I mean there is a reason why economics departments tend to exclude people who have social views because they do why Abel Lerner when I met Abel Lerner he was an employee of a university I don't remember it was private or public I was giving a talk on my first paper and he made a very intelligent point and I later discovered that was Abel Lerner So an economist who actually is a good economist which Lerner was although I disagree with his politics can indeed get a job and I think you will find that it is that on the whole academic departments shift way left of the population in general not as far left as you would think they should because you're in favor of truth and farther left than I think they should because I'm in favor of truth and we happen to have a small disagreement on what's true Well that is one I don't think that established just that it's no problem We will jump to the next one from Dear Will thank you for your question says Dr. Burgess as someone else who lived in South Korea for 13 years how is an optional insurance savings account for preventative care funded by worker and business a socialist system the money paid in belongs to the person It sounds like they're 13 years in Korea where before it adopted it's current system I'd be very curious about the dates there Korea right now I know it's a relatively recent development I think in the 90s maybe even later but Korea in the time that I lived there has national health insurance that every single person gets not only citizens but people there on work visas in fact people there like my wife was at the time on non-work visas still get a national health insurance number so I think the questioner's information is out of date Is the health care in fact provided by the government or is it only insurance that's provided by the government It's insurance is provided by the government there may be nationalized hospitals there may be a mixture but it's certainly not all nationalized hospitals they're definitely private hospitals in Korea because I think it's the case in general I think England and Canada are exceptions but I think that most of the systems that are thought of as having government health care the health care is largely though not entirely private but there is some version of health insurance which covers some but not all things depending on the country I mean it varies wildly you have certainly Scandinavian countries for example where you have there are some private hospitals but the vast majority of hospitals are publicly owned and even in some countries where you do have private hospitals if the government is footing the bills so the bill and those hospitals are non-profits it's a very different kind of situation than in the United States where it's normal for a hospital to be owned by a bank I think actually my guess is that a majority of hospitals here are also non-profitables are not all of them but that would be an empirical question we would have to settle in which I don't know well let's take another question jump in from Gartham thanks for your question says as a machinist and as a machinist who has worked with robots there's benefits to new automation it makes processes efficient for a large population reduces physical stress and creates a higher skill of labor for better pay no threat here I think that's for you Ben yeah so I mean if the claim is just that that automation you know automation has winners then uncontroversial that there are lots of people for whom it has benefits it's certainly not that's certainly not exclusively the case that there are winners there are also under the current system at least lots of losers an argument that futurists will often have with each other is whether as even plenty of very libertarian you know Silicon Valley types believe you know you're going to get long-term structural unemployment caused by automation in the future or whether as many people who dispute this think that you know it's as some you know as some work that's done by humans is automated away new things always open up and it always balances out in the in in the end and all I would say about it is whoever you think is right in that empirical argument right whoever's predictions you think are right it's it's still the case that you have a problem that when the machines are privately owned you have this this incentive to say oh great you know we we can you know we can hire you know we can we can have fewer employees we can get rid of a lot of them or you know reduce our labor costs in other ways like making people get cut down apart time whereas the hope would be that in an economy where workers control was was predominant that it could be caused to know that it could be that it could be handled in in other ways also I would I would just I would just point out that whoever you think is right this problem exists because either you're going to get the worst thing which would be long-term you know unemployment so under capitalism the best you can out for is you know the modern equivalent of bro Roman bread rations the form of gang bucks or something or you can have or at best new stuff opens up but you still have a lot of dislocation and misery in between you bet thank you very much and then next up we're a little I wanted to comment on that question too because the problem is that under Ben's system it's there are still going to be losers because there are going to be some workers co-ops which are specialized in producing a particular kind of good they're specialized in producing the tools for hand production of things that are now being done by robots so that in in his system if I understand it because it's not a straight social state socialist system where everything is a pool that the government distributes is a system if I understand it correctly in which each workers co-op is supported by what it sells its goods for to consumers I think that's what he's describing and if it turns out that some workers co-ops now adopt the new technology and the result of that new technology is that other workers co-ops find there are no customers when they were producing then you were again going to have losers as well as winners that's a case in either case yeah the question is whether whether you're going to have as many losers and or whether with a different system with a different structure you know you could have vastly fewer you know vastly fewer I'm certainly not going to argue that it's going to be all you know sun shining unicorns and nothing bad is ever going to happen as a result of technological change I would argue that you have many more losers because I think your system is much less flexible but that would be a long argument that is to say that the workers co-op is going to be less willing to release workers who would then go to others workers co-ops in part because when they workers co-ops leave they lose their share ownership of the capital assets of that co-op but that would be another long argument we uh we'll jump to this next one from Brenton Langel thanks for your question Brenton says in libertarian socialism there are no legal codes preventing capitalist models but you likely won't find anyone willing to work for exploitative wages read David Graber's parable of the divided aisle I don't know what exploitative wages mean but I have no objection to a system in which people choose to organize themselves in workers co-ops as long I do object to they're saying everything anybody's done before now belongs to us and gets confiscated but as far as I can tell part of the attraction of a market is that it is open to everything from the pure market form of individuals contracting with each other all the way up to the hierarchical structure of something like Walmart and all the way up or down or sideways or something to a workers co-op those are all consistent but they're consistent under rules in which if you want to get money from people you've got to offer them something they're willing to pay you for and if you want to get workers to work for you you've got to offer them better terms than anybody else does Josh yeah thanks for your question this one coming in from Huckleberry I would just momentarily here say once again I think the question about I think the question about competition and having reintroducing wage labor I think is structurally similar to the questions about minimum wage laws sexual harassment laws and the numerous other ways that civilized societies prohibit certain employment contracts now whether it would be necessary to so prohibit it or not as an empirical question but whether there's anything wrong in principle with prohibiting certain kinds of abuse of labor contracts I'm just I see no reason whatsoever to put this in a different category than those other cases another question thank you very much Gartham asks and they say in my work we can invest in company stock with a discount over time giving ownership and an incentive to dedicated employees over time is this better than a co-op I started like like I mean I can give my response I wasn't sure who I would say no and and my reason my reason for thinking no is is that if you have a partial you know in employee employee ownership then that's certainly not going to have all the benefits of worker ownership especially if you know different employees or you know or outed different chunks of it and even if you have a case where an entire company is owned by like an ESOP an employee stock ownership plan then this is an improvement in some ways on standard firms but if it's not organized as a as a worker co-op then your day-to-day experience at work is going to be the same so I would say if a company is entirely owned by the employees then all of your arguments about why it can't become as a worker's co-op go away they already own all of those capital assets so if you believe you hope that you can persuade the population of the US to make this massive political change but you don't believe that you can persuade a majority of the employees of a company where it's all stock ownership to simply reorganize their company in what you believe is a much superior fashion that seems a little bit striking yeah I mean it would be strange if I if I believe that or if I said it I don't think I expressed any prediction any view one way or the other about that I just I just said that if they don't make that change then they're disadvantaged but but if you're right then they would make the change you're just you you're saying that anyway well I mean just because I want to just because Dr. Friedman yielded on the last one I want to give Dr. Friedman the last word on but let's see Huckleberry Huckleberry sin said Dr. Burgess can you explain how a social program that works with 50 million people can work with 350 million people or even a billion people yeah so this is the this is the scaling the scaling up objection and and I think it is interesting to to note that if if Dr. Friedman is right and in one of the very first things that he said about how how top-down forms of planning are most effective at very small scales and become you know less and less effective as you scale up then that should mean that the the more people that you're talking about within a firm the the the more advantageous it should be to organize it as a cooperative rather than to have no to organize as a market the alternative I'm offering is not your co-op because your co-op also has scaling problems the alternative I'm offering is that everybody is contracting with everybody else buying and selling what's called the inside contracting policy in the 19th century it has serious limitations which is why many things are not done that way but the basic argument on scaling is the centralized control whether centralized control through democracy or through a boss or either in between scales badly markets scale well there are however some enterprises for which the transaction costs of working through a market are high and through those enterprises you build up the hierarchical system until you reach the point where it is now where the inefficiency of additional hierarchy balances the inefficiency of the costs of doing it on the market that's COSES theory of the firm you should read it it's a good article if you if you if you think that internal markets within firms are a good idea I would recommend looking into the history of Sears gosh and I also recommend folks you was not talking about internal markets I'm talking about the situation where the firm can either make its own tires for its cars or buy tires also want to recommend you check out the links of our guests folks which are in the description we've got just a few more questions we cannot take any more questions because we're we really want to wrap this up quickly so this one coming in from appreciate it THFC rance says for the question on Korean health insurance they said not correct Dr. Burgess as of today 99% of Korean hospitals are private if you don't pay into your account you get zero care the care only covers outpatient services and small inpatient systems it also only covers a percent of care so the let me let me just just see so they so I heard two claims there one of which was relevant and another one of which was was irrelevant so one of which was about the hospitals being private which is a separate question from whether the the insurance is is private is private or not so I know I know that the that it is it is a much more centralized and consolidated national health insurance system so I see here in 2000 the national health insurance insurance service NAHS was founded to combine all health insurances into a single national health insurer as to as to the you know the funding mechanism for for that then you know that it's it's it's possible that I that I I stand corrected there but but I do know that even if you're in Korea on a non-work visa you're automatically assigned an insurance number within that national health insurance system gotcha and this one from William says Dr. Burgess last question of the night and they say Dr. Burgess how do you protect the rights of the minority in your economic system if there are none how is this moral well I'm not sure which which minorities we're you know we're concerned with here so if the if the majority is that that we're concerned with our our our racial minorities or our religious or ethnic minorities then then I would argue that the track record of capitalism and correcting historical inequities for you know facing those those groups is is very very bad and and that I that any move towards increased society-wide economic inequality would be very helpful there if the if the concern is like ideological minority somebody being snuffed out you know do you know like I think that given that anybody confound confound a worker controlled firm that they want to you know as they convince other people to to go in on them with it I'm not sure where that concern arises within you know within the sort of feasible socialism being described if the minorities that we're concerned about is the is the minority of the population that that currently employs most of the rest of the population then yes it's a well-founded concern but that's not a minority that I stay up night at night worrying about gosh and want to say folks our guests are linked to the description folks it doesn't end here hopefully this is just the start where you now go to their links at the very top of the description click them and you can read and hear plenty more from our guests we really do appreciate them we want to say thank you very much Dr. Freeman and Dr. Burgess it's been a true pleasure to have you thank you for hosting us our pleasure and so I will be back in just a moment with a post-credits scene where I'm just going to basically let you guys know what upcoming debates there are as we're very excited about the future and so I will be back in just a moment keep sifting out the reasonable from the unreasonable everybody thanks so much everybody huge thank you to our guests as we it's uh it's such an understatement to say we appreciate our guests we really do we love their I mean I can also tell you they're both personable friendly guys and so I would encourage you folks to click on the links of our guests in the description below from both Dr. Burgess and Dr. Friedman really do want you to check them out and so it is honestly that was an exciting one it was a fun one and so glad to just quick say hello to you union brother thanks for being with us my friend I did actually just talk to Matt Delahunty today and so not over the phone just through messaging and basically Matt said you know he's like well you know I'll think about it in terms of you know coming back on in the future and he said you know let me know if there's a debate that you want to run by me in the future so it is a possibility and like I said we we never feel entitled to any guest we're just thankful to have the guests that we have as a I have to say like we're not only thankful but thrilled because they're spectacular guests and so yeah that's a it's a possibility but I'm going to upload everybody and say thanks for being here with us manic pandas thanks for being with us Fox Sushi good to see you again and let's see let's see thanks for your kind words modular mammoth thanks for your kind words Antonio and thanks so much see money burns for your encouragement and yeah folks I have gotten your feedback in the chat and I would agree that my moderation can improve and it's a a point of it's something that I am like 100% open to like oh man I'm just going to stay the way I am and I'm like no like I'm open to the idea that I can improve and moderating and so I do want you to know like I I do take that seriously in terms of your feedback and I appreciate you and so if it was not if you thought hey this could really use some improvement well I am working on it no joke and so believe it or not despite having done so many debates I'm like you know what I can improve and there are ways in which I'll I'll be working on that so thank you for being with us and dug a glad to have you excuse me thanks so much for being with us dug a thanks space for coming by also top hot too we got 208 likes thank you guys so much for your support that is super encouraging really appreciate that and also I have to go in just a moment but forgive me can you give me two seconds I'll call you right back thanks so much friends I I had promised a friend that I would talk to him in this show went later than I expected and so I can't stay long but I just want to say thank you everybody for being with us thanks Stacy Flores for being with us Mr evolution 573 thanks for your kind words thanks sideshow now for being here again Lance Lance plays lol thanks for being with us and yeah we're excited though and so you guys I appreciate all of your kind words and love it's a really hard thing to moderate because for me it is like it's so hard where I'm like I want to be as fair as possible and there's there's just a lot of stuff going on in my head in terms of like different factors and me wondering as well if I'm I'm like well should I say something at this point or is it my bias that might make me say something so there's like a lot of like examining during the debate where I'm like questioning myself and kind of saying like is I should I or am I being biased for wanting to jump in and so I appreciate you guys letting me know that but your feedback and thanks for modular mammoths thanks for your kind words that thank you for making this platform despite my criticism of moderation in this debate thank you for letting me know that that seriously does mean a lot I like the idea of like me getting to have a relationship with you in which it's like one in which there's potential for growth because here's the trick one thing too sometimes people are like screw modern day debate never I'm never coming back I hate you and I'm like well but how like if you wanted me to change and now you're just like leaving forever like I'm open to taking your feedback and changing but if you're gonna be like screw you James I'm leaving forever it's like well how can you like well first I mean in a way it's like well if I feel like I already lost you it's like well then why you know it's like well they left anyway like why should I try like but the other thing is it's like if you if you're willing to stay and just like let me know that feedback is helpful and so we do appreciate kind of having that ongoing relationship with you guys and thanks for that and so let's see topot2 says spent today's debate chatting on twitch it's great over there very chill I'm so glad to hear that my friend thanks for letting me know and it is true we are on twitch folks and yeah we rarely we don't even have it on screen anymore oh well we have the bottom the ticker there but we are on patreon guys as we appreciate your guys' support on patreon let me see if I can find it yeah so I will throw that in the description we do appreciate your support and you know check it out if you dig it it's nothing fancy to be honest but I will just throw it in the chat in case you're like hey cool but uh yeah we don't really have anything like super cool or fancy in terms of patreon to be honest it's more of like if you just love the vision of our goal our vision is to provide a level playing field where everybody can make their case and that it would be as fair as possible and so we are working on perfecting it that's for sure we still have you know a ways to go but thank you so much for your super chat oh gosh there it is oh yeah I read that thank you top out appreciate that buddy mark or uh thanks so much modular mammoth for your kind words though so I'd appreciate the effort we'll be back that means a lot I really do appreciate that and then mark reads says don't giggle at Darth Dawkins that's true thanks T HFC Rance Will Stewart says I don't think it was your fault there were three times as many people in the live chat that night is normal lots of new faces and I don't care about the rules of discourse thanks for your kind words I appreciate it and yeah we we've got room to grow and so we will I promise and thanks for your kind words on your support and they said if you feel bad about muting one person implement a global mute rule yeah you're right I can communicate I think one thing is if I communicate to debaters beforehand like hey do me a favor try to be a short and pithy during the like you know communicate expectations up front and so uh slides slideshow now of oh boy you're right they're honestly when you see this Friday's guest you may be triggered I don't know but uh yeah we're excited it's going to be a lot of fun and so thanks for your kind words watch talk and then um thanks modular mammoth for saying that yeah like it is for me like I do take it seriously where I am like I'm very what's the word I'm looking for I'm open I'm like I don't like it when I meet people who are like I'm not biased about this like I'm new like I'm I'm as unbiased as it gets and I'm like here as cringe as it gets I like and I the reason I say that is because in psychology there's just so much empirical data that we have real biases hindsight bias confirmation bias of all sorts of biases and fundamental attribution error is kind of a we could say another type of bias in which conveniently leads us to not believe we have biases so it's funny that that's the way life is but thanks for your patience guys and uh but yeah let's see Jamie Russell good to see you are you he said are you a dualist I'm not sure there was a I've got to read about hyalomorphic dualism I think that's what it was called but long story short I'm I'm still not sure on on that issue but I appreciate your appreciation for the philosophy of mind and Brooke Chavez says there is someone who can help with twitch emotes and stuff oh that's cool thanks for twitch chat for being oh thanks Brooke Sparrow for your kind words gifted thanks for gifting a uh a sub to top subtle you're a what's the word I'm looking for Brooke Sparrow is a generous person and so that is cool and then top subtle said I love I love watching not done them I do try to reason with people in real life I do appreciate you guys being here in the twitch chat as well I know that sometimes I'm a little slow to check it but let's see yeah we do appreciate all of your kind words and support and everything else and so let me just peek through here I wish I could stay longer I just have to run but Brooke Chavez says there are a lot of folks who will join twitch if the stream has the interactive aspects that gives chat ways to support your channel in a monetary way oh okay well I will work on that and I appreciate you letting me know that that if it makes it more fun and engaging in the chat like that's great and uh thank you guys though for letting me know all these things I'm still learning twitch as well and so long ways to go so thank you guys so much for all of your support all of your help in teaching me these things because I'm dead serious that's like there are two things on my priority list right now and also someone just reached out today and they said hey I'd be willing to help with your graphics and stuff and I was like that'd be awesome because like that's something again I don't really have uh a lot of experience at like I think my biggest experience thing is that like I used to debate myself and then I've got like a couple of master's degrees like philosophy and psychology and stuff and then I just enjoy it I don't know I mean that maybe counts for something and that I'm it's at least consistent we're here often and so otherwise I I have to be honest like the tech stuff and in even moderating after about 500 debates there's room for improvement to be sure so thanks for your your flexibility and so yeah I just appreciate you guys so thank you for that feedback thanks all for your love and support seriously I appreciate you guys you guys make this fun you guys cheer me up when I have a bad day you guys honestly I just appreciate doing this you guys make it fun the more the merrier thanks for all of your support you guys but yeah I'm pumped and so thanks for your kind words you guys seriously it means a lot we will be back Friday night and I promise it's going to be a juicy one you guys it's going to be an exciting one and so we you won't want to miss this one I can I can assure you and so thanks so much want to let you know we appreciate you keep sifting out the reasonable from the unreasonable and I wish I could stay later but I've got to run as like I had said I had promised a friend oh gosh I didn't even realize this this late so I definitely have to run but thanks everybody keep sifting out the reasonable from the unreasonable we'll be back next time if you have not yet hit that subscribe button and that notification bell for reminders so you don't miss this Friday surprise juicy epic debate and so thank you guys so much for your kind words Brooke Chavis and Jamie Russell and I just really thank you guys for everything appreciate all you guys love you guys and so thanks for all your kind words see you next time