 This weekend we host Dr. Mark Thornton, senior fellow at the Mises Institute and well-known Austro-libertarian professor, author and public speaker. Mark is a noted expert on the economics of drug prohibition, having authored the seminal Austrian treatment on the subject titled, The Economics of Prohibition. He's also a sought-after expert on the Skyscraper Index, which attempts to link urban overbuilding with economic busts. Mark and I discuss his recent experience as an opponent of the drug war at the Oxford Union Debating Society, his influence on Wikipedia founder Jimmy Wales, and how Wikipedia demonstrates a kind of stateless, spontaneous order, complete with private dispute resolution. Stay tuned. Welcome to Mises Weekends. I'm Jeff Deist, and we are very pleased to be joined this weekend by none other than our own Dr. Mark Thornton. Mark, how are you today? I'm great, Jeff. Great to be on the show. There's so many things I want to talk about right now. I want to pick your brain, but first I want to start with your recent trip to the UK. You were invited to the Venerable Oxford Union Debating Society, which apparently has been in existence since about 1823, and you were invited there, particularly because of your known expertise on the drug war and the economics of drug prohibition. So tell us a little bit about that experience and how it came to be. Well, it was just incredible, and of course it's a great honor to be invited to the Oxford Debate. Margaret Thatcher, Ronald Reagan, Dalai Lama, Mother Teresa, there's photographs of all these people throughout the Oxford Union Debate Hall, and it's just amazing to sit in the same place and to put your hand on the same debating table as people like that. So they invited you to take the pro position that this house, meaning the Debating Society, Oxford Union, should oppose the war on drugs. How did it go, and what was the gist of your argument? Well, it went tremendously well, I think for our side. Each team has a student who makes the proposition or opposes the proposition, and then three team members. And so after the students went making the motion and making the opposition, I was the lead debater, and I got up and basically made the theoretical and historical case against prohibition, and I think it went extremely well for our side. I think I got the best laugh of the evening, and I got the best ending applause of the evening, and it certainly seemed like the audience was on our side, although technically we actually lost the debate. Do you have a feel for sort of the public perception of the drug war in the UK? Does it differ from how people view drug prohibition here in America? Well, I think it's similar. I think especially at Oxford, Oxford is the sort of the central training ground for English politicians. So it tends to be more statist and more for government and more for socialism. And so even the student body was leaning in that direction compared to other universities in the UK and compared to other universities in the US. But there's, I think, less of a war on drug culture over there, I think, in terms of getting drug policy liberalized in the UK. I think there's always been a stronger tradition there in the UK, and of course there's been a lot of noise coming out of the UK in terms of opposing the drug war. Most notably, the London School of Economics just published a massive study saying that the war on drugs needs to be repealed. What's interesting is I think the public on both sides of the pond is starting to view the drug war more as an economic issue than simply just a social or treatment or a public health issue. Obviously, you've written from an Austrian perspective, one of the seminal works on the economics of drug prohibition. I'd like your take on whether there's a particularly or a peculiar Austrian take on the drug war as opposed to just a free market take on the drug war. While there is, in the general context of mainstream economics, they have the same model as the prohibitionists themselves. And that model is you spend money on the war on drugs, you prevent drugs from entering the economy at least somewhat, and then that reduces the problems associated with drug use. The Austrian point is basically that by spending money on the war on drugs, you really don't reduce the availability of drugs. So there's no benefits at all. There's only unintended negative consequences. And so the Austrian take, my take is that there is no benefits to prohibition. It's all cost and it's all negative unintended consequences. So it just makes us worse off. Is there not also quite a bit of rent seeking going on? In other words, there's a prison industrial complex. There's public defenders. There's police. There's drug treatment centers. There's a whole panoply of people who, although they may not be bad people, they in effect profit personally from the drug war. Well, that's absolutely correct. There are people who benefit from the war on drugs and it includes the judicial system, law enforcement, prisons, lawyers in particular. And one thing that shocks people is that in the United States, we have this massive private prison industry that makes money off of us sending people to jail. The more people we send to jail for long periods of time, the more money they make. And so they're in the business of lobbying Congress as well as state legislatures to make penalties stiffer, heavier prison related to make more things criminal in society. People are shocked by that. They think that prisons are run by the government, but an increasing share of the prison population and it's a huge population is housed in private prisons. Folks, it's interesting to note that even before we had this gigantic industry that revolves around the drug war, Mises sort of understood what prohibition meant conceptually for society. And let me quote him here from liberalism, which he wrote in the 20s. So folks, this is well before modern drug prohibition, quote, as soon as we surrender the principle that the state should not interfere in any questions touching on the individual's mode of life, we end by regulating and restricting the ladder down to the smallest details. So certainly press it for his time. But Mark, I wanted to shift gears real quickly and talk a little bit about some unknown history that surrounds you and the Mises Institute and Jimmy Wales, the founder of Wikipedia. Mr. Wales was an undergrad here at Auburn University. Apparently in the late 1980s, a finance major when he stumbled upon the Mises Institute. And of course, you were quite new to the Institute at that time as well. And a fresh PhD in economics. Can you tell us a little bit about that history? Yeah, I was working in the Mises Institute at the time in a different location on campus. And one day, as I was working there, Judy Thomson was there, I think, in walks, Jimmy Wales, an undergraduate student, as you said, finance major at Auburn. And at the time, he was reading Human Action based on the recommendation of Iron Rand, the written recommendation of Iron Rand. And he was an objectivist and was very interested in that whole philosophy. And so he was following up by reading Mises's Human Action. And so he saw the sign while walking to class. He saw the sign on the building, the Ludwig von Mises Institute. And so he comes in, pops his head in and, you know, wants to know about the Mises Institute and in particular, if every campus had a Mises Institute associated with it. And from there, you know, he asked questions. He asked if he could come in and use our library, which, of course, has always been the case with, you know, students are free to use our libraries. And so he would come on in on a regular basis and read and study and ask questions. And they were very difficult questions compared to Auburn University students in general. These were very penetrating, hard to answer type questions. And he was always looking for new reading material, particularly on the Austrian economics of information, of knowledge, of knowledge dispersal, of knowledge markets, very difficult questions to answer at the time. And it wasn't until several weeks or maybe even months later that I recalled F.A. Hayek's article, The Use of Knowledge in Society, which was published in the American Economic Review in 1945. And so he picked up that article. We had that journal in our library at the time. And so, you know, that's supposedly sort of the inspirational theory behind the structure of Wikipedia. Where people from all around the world can contribute and people from all around the world can use the information and people from all around the world can also correct and dissect the material that's going on there. So and Jimmy Wales has, of course, mentioned this on several interview occasions that Hayek's article was sort of the inspiration for Wikipedia. Well, it's interesting to note that Jimmy Wales sort of took Hayek's concept that prices represent information, that they represent a form of spontaneous order and applied that to the realm of ideas. In other words, that's how he saw Wikipedia operating. And today, I think from the anarcho-capitalist perspective, there's a lot to like about Wikipedia, right? In other words, in some sense, is that represents a form of peaceful, spontaneous order, which you might also term anarchy. And it even has a format for corrections. And you might say the corrections to Wikipedia entries sort of represent the marketplace responding just like they might to consumer preferences and prices. So I'd like to get your thoughts on how Wikipedia operates today. Well, you know, I think it's based on individualism. Individuals can contribute, they can use, they can correct, they can edit. And so it's a free-form organization, really. And it also generates very little taxes for the government. So that's another thing to like about it, despite the fact that it generates immense value for so many people in society. There's no government subsidies. There's no government regulation. And there's no revenue that gets accrued to the government. So it's really a fabulous product, maybe possibly the single most valuable product that's been created in our lifetime. And it's all been done by the market. It's spontaneously evolved to make improvements. There's a hierarchy. There is a meritocracy where better editors are given higher levels of authority. And so in many, many ways, I think it represents the best of what freedom can do for us. Well, I think one interesting note about Wikipedia is that it has a dispute resolution process, i.e. when people have a conflict over what's reported in a Wikipedia entry, there is a system of common law of sorts that Wikipedia has developed. There's sort of a constitution with the basic policies. But then there's also guidelines which have evolved almost like judicial precedent. And if you listen to Judge Andrew Napolitano, he talks about natural law and common law evolving and being almost found law as opposed to legislative created or man-made law. And so I think in this sense, Wikipedia represents a promising example of dispute resolution that might apply in a libertarian society in broader contexts. Yeah, it's a wonderful model because it starts out very simple, but then has to adjust due to increasing levels of difficulties, new types of problems. The Wikipedia resolution system has to evolve to meet those challenges. It doesn't do so in a seamless, perfect, costless way. It's still a very messy process, but that's also true for the common law. That's not something that where everything gets a perfect solution immediately. It takes time. There's errors that are made. And those costs and those errors basically force the system to correct itself and to evolve. Well, let me quote again from Jimmy Wells. He's talking about his goal for what Wikipedia would become eventually. He said, imagine if we could have the sum of human knowledge available for free to every human on the planet at their fingertips. Now that's an audacious goal to be sure, an entrepreneurial goal, but I think it's largely true to the extent that humans have computer access wherever they might be on the planet. But I'd like to get your thoughts. I've asked several guests this over the last few weeks. As you know, information in and of itself does not equal wisdom or knowledge per se. In other words, it seems like we've never had more information at our fingertips yet in many ways where no less intelligent, maybe far stupider that our parents, our grandparents, our forebears simply because we don't use it in beneficial ways. Oh yeah, that's always been the case. Information can be used for good or for evil or for neutral purposes. It's the way in which we use that information. I think on net, it's always going to be a benefit to humanity that we have more information than we have easier access to it. And of course, in science fiction, not only is Wikipedia, you know, completed and translated into all languages, but you're given a little plug into your brain so that you can instantly recall any information whatsoever. So you in effect or we in effect are all clued into this giant Wikipedia system. And that's kind of a daunting science fiction futuristic problem. But in general, I think that you have to think that Wikipedia is going to be a tremendous benefit to humanity. And I think we have to adjust and be better users of that information to sort of counteract that problem of dumbing ourselves down and relying too much on technology. But you know, the fact that we don't have to remember everything and that we don't have to go to the library to look something up, we can do it right there at the kitchen table or wherever you are is just an enormous benefit. Ladies and gentlemen, Dr. Mark Thornton, one of the most interesting libertarian theorists and academics working today read his stuff at mises.org follow him on Twitter at at Dr. Mark Thornton. And Mark, thanks a million for your time. We hope to have you back soon. Hey, Jeff, it's been great. I look forward to doing it again.