 So good morning everybody, how's everybody doing? Let's get a little applause going for Dr. Bob Murphy. You know, I would like to say that I personally have really enjoyed this lecture. I consider it one of the more important and engaging lectures of the week because I'm actually quite proud of the fact that the Mises Institute is a place where we can at least consider or explore or maybe even advocate the concept of a truly stateless society, one where even supposedly public goods were national defense, so-called, where streets and roads and police even and judicial services are provided privately. And of course, this is a necessary topic in that sense. But nonetheless, I think it's one that's important and one that we need to consider seriously. So I'm glad that you all made it to this plenary. But earlier in the week, I mentioned that the relationships that people have made over the years and the connections are as important as the ideas themselves because that's how ideas are transmitted through actual human beings. And so we would be remiss if we did not mention that our great friend and senior fellow Dr. Bob Murphy recently wed his girlfriend, Kellyanne. And we just wanted to congratulate him. We have a set of matching his and her towels from Kmart or anything like that. But we just wanted to congratulate them. And we wanted to say how pleased we are for them and that, on behalf of the Miseson student, everyone here, how much we love them and care for them and wish them many, many happy years. So congratulations, Bob. Thank you so much, Jeff and everybody. I'm pretty sure that that's a copy of human action in there. But it was a pleasure to be here. Thanks for showing up, everybody. And as Jeff said, this is a fun one. Let me just clarify. So I'm going to be going over lots of different topics in this one pretty quickly, breezing through. However, the issue of military defense, that's such a thorny issue in that there's so many conceptual hurdles there that that's going to be, if you're interested in that, I'll be covering that tomorrow in a separate lecture. Last housekeeping notice, as far as private law, like police and judicial services, the single lecture you want to go to for that, it's called the Market for Security that I've given at previous Mises use. And so that's the one you want to look up for that as well. So without further ado, let's jump into this talk. So just to set the stage for this, I like to open with this quote. I'll read it for those in the back. For if the bulk of the public were really convinced of the illegitimacy of the state, if it were convinced that the state is nothing more nor less than a bandit gang writ large, then the state would soon collapse to take on no more status or breadth of existence than another mafia gang. Hence the necessity of the state's employment of ideologists and hence the necessity of the state's age-old alliance with the court intellectuals who weave the apologia for state rule, okay? And so that's kind of the context and partly what I guess our mission is for those of us who lecture at Mises University is just educational to show people once you see things in this fashion, it's pretty obvious what the conclusion would be. And I believe it or not, some people might recognize this quote, but it actually comes from Christina Romer. If you, yeah, well, she was younger, she was pretty, guys, come on. It's Murray Rothbard, give me a break. All right, and see, if you believe me for even half a second there, that's the problem, okay? You can't just, just a guy's up here in a coat telling you stuff, no, no, no, no. You gotta think for yourself. Well, you should trust no one, all right. It's your fault the state still exists, okay. All right, and so I'm gonna obviously jump into specifics here, but let me just also, in terms of the general outline, whenever you encounter a problem, like it's because the typical pattern is that there's some difficult social issue, you know, people are being harmed or their prosperity is being shackled by some thing going on. And then unfortunately, most people immediately rush to, oh, well, the state can do something about it, right? And that's the first thing that people go to. But what I want you just to remind you of is that if everyone knows that a certain voluntary arrangement would, quote, lead to disaster in some area, then that means there's a huge opportunity for an entrepreneur to come in and fix it, okay? And so with all this stuff, it's odd. It's like there's this market failure and everybody on the planet can totally see what the problem is and knows the obvious fix except the people who would make billions of dollars from doing it. They're assumed to not know how to fix it and they're just gonna see, oh, well, it's free market, can't do anything about it. In particular, the way this manifests itself when it comes to economic models of what's called market failure is that they have a very narrow set of strategies, let's say, to use that technical jargon that the firm can engage in. So just to give a simple example of what I mean, something, there was this problem that economists deal with where what if marginal cost doesn't begin rising at some point? Certain applications like air travel, things like that where once you're gonna build a plane and have two seats available, then to add more and more passengers, the marginal cost of the airline is pretty low. And yet if the airline merely charged every customer what it costs to just add one more person to the flight, well, then it doesn't work out, right? The airline would be losing money if they charged every customer the marginal cost of the flight. And yet they also couldn't charge the first customer the full cost, that sort of thing that the first person can't be ended up paying a million dollars to fly somewhere but yet to add the 37th passenger that's a pretty low marginal cost and yet every ticket can't cost that. So if you're familiar with mainstream economics, you know that under ideal conditions, the market is optimal or you reach a Pareto optimum when price equals marginal cost. And if it doesn't, oh, there's monopoly power and blah, blah, blah. All right, so that's just one example of the kind of thing I mean where when you try to apply conventional economic tools that real life situations, it sometimes pops out but the market's stuck and can't fix itself when obviously there's other pricing strategies. Another example would be something like wholesale clubs like BJ's or Sam's club, if you guys are familiar with that where you buy things large bulk purchases and they charge you a much lower unit cost than you'd get elsewhere. So they're not literally charging you the marginal cost to them in terms of the accounting but it's much closer to that and so how does that model work as they charge a large fee for you to be in the club to have the right to come into the store in the first place and then you also pay unit prices for the stuff you buy. So that's just one example of how they partly solve this problem of oh, what if marginal costs are really low for large ranges of output? We can't reach the optimum. You could say, oh, well instead of just charging a unit price to everybody who buys products, maybe you charge a membership fee and that's how you somewhat separate. So you're charging for that consumer surplus if you know that term. Okay, so that's just some examples of what I'm talking about where they sort of arbitrarily fix what it is that private business is allowed to do or charge based on and then they conclude up, see that's gonna lead to a market failure and then they have the government come in and it has much more tools than its disposal. Okay, so let's talk a little bit about money. I think they probably covered a lot of this in the earlier lecture that you saw in this but it's okay if there's some repetition here. So is Carl Manger, the founder of the Austrian school explained money emerged on the market and this was a tour de force of his explanation where he walks through and shows, for example, that the so-called state theory of money doesn't really make sense. It really doesn't work to say, okay, well there was a time at which humans didn't have money and then there's a time later when clearly they do have money. It's not a natural thing, right? It's not like trees. So clearly money somehow is related to human activity and so the natural conclusion most people would have is there must have been some wise king or philosopher somewhere in the past that invented money and then maybe could Joel people or persuaded them or used force to get the community to start using it and then the benefits were made manifest and there you go and that's where money comes from. And so Manger had several arguments to show that that really doesn't work. So one thing is we don't have a record of such a person. You would think if some wise king thousands of years ago invented money that might have been recorded but there is no such record of someone inventing money. Also it's just the inherent implausibility of it that if you hadn't seen money in operation if someone tried to explain it to you, it sounds dumb, right? If you think about it, imagine some king saying, okay, right now you guys are trading horses for eggs, let's say, and it makes sense why you're doing that because you use the horse for transportation and you guys eat the eggs so you can see why you would do that. But how about, here's these shells that nobody really cares about one way or the other. What if instead you sold the horse for these shells and then someone said, why would I do that? I don't want the shells. Don't worry, because this person with the eggs will also accept the shells. And so if you could convince everyone in the community to accept something they don't really want because everybody else is gonna do the same stupid thing. Trust me, if we all act stupidly in unison it will all, right? It's sort of like a frat initiation ritual. But, so that's, you see how that, if you were trying to explain to someone who had never seen it before, it sounds crazy. And so, Menger just goes through and he shows these problems. Even if you solve that problem, let's say the king did convince everybody in the realm, okay, from now on, every time you want to trade something, first sell it for these things that you really don't care about one way or the other, but don't worry because somebody else in turn will do likewise and reciprocate. Even if you could get everyone to agree to do that, or maybe they did it because you're saying, or chop your head off if I catch anyone selling against things besides these shells that the king's holding up, how would you lock in the purchasing power, right? It's not enough just to say the person selling your horses, now you gotta do it against these shells. You don't know how much is one's shell worth. You know, how many horses, or how many shells should one horse fetch in order to answer that you would need to know, well, I kinda wanted to actually go get eggs and so I need to know how many, you know, these shells, how many eggs do they command in the marketplace before I know if I wanna sell my horse for shells. And so you see the problem is really difficult once you start seriously considering it. So Manger came up with a theory for the origin of money that solved all those problems or that was impervious to those objections. So real quickly, he said that, okay, even in a, I'm paraphrasing obviously, but even in a state of barter where there's no money, there's no even what's called a medium of exchange, still different goods would have different degrees of salability or marketability or liquidity if you know those terms. So like eggs, there's more of a market for eggs. More people would be willing to accept an egg on any given day than people who are in the market for like a fancy telescope. Okay, so a telescope's very valuable. If you found the right buyer, you could get a lot for it, but most people on any given day are not looking to acquire a brand new telescope. So the idea is if you're going into town with a telescope that you're trying to unload, you're in a worse marketing position than someone going into town with two dozen eggs. All right, and so let's say the person with the telescope ultimately wants to get horses, the chance of you finding someone with a horse who also wants a telescope that day are pretty low. And so what you'd be willing to do is anybody who wants a telescope and has a good that's more marketable than telescopes are, you might consider that as a stepping stone, as an intermediate transaction to get rid of the telescope and get something like maybe a bunch of chickens that are closer that you know is more marketable, that you're more likely to find someone with the thing you want who is accepting chickens that day, okay? So that's the process that seems pretty straightforward. And yet if everyone's doing that, just think about the implications. So that means the goods that initially had a wider market just because of natural preferences. Now the range of people who would accept it is enhanced from that first round of just thinking through, oh wait a minute, I would not only be willing to accept the stuff I directly want to use, but something that's more marketable than the thing I'm starting out with, okay? So the goods that were initially the most marketable, their advantage gets amplified. And so Manger just said that process you can imagine would continue as people see other people doing that. Now the things that were more acceptable like eggs, let's say are even more acceptable, even people who are vegan might still accept eggs because oh, I know a lot of people like these things. So that's what would happen, but it's more than just the acceptability. Obviously eggs wouldn't be very useful as a medium of exchange because they're so fragile, they don't last very long, even if you attended them properly, you can't cut them in half very easily, something costs half an egg, that's awkward, right? And so that's why with that process in mind, things like gold and silver ultimately arose as the market's choice of money because of their property. So it's not that gold is money because it's easily divisible per se, that's not the definition, but the fact that gold is very easily divisible and so on, it's durable, it's homogeneous in terms of its quality, that an ounce of gold is an ounce of gold, unlike diamonds, sorry, so that's why diamonds don't really work well as money because to say something costs a kilogram worth of diamonds, it depends how big the stones are, right? It's not that they're interchangeable, whereas with gold and silver, the weight, as long as it's a specified quality, purity of the metal, the weight's really the only information you need to know in terms of saying how valuable is this pile of commodity, all right? So that's how Menger explained that process and so notice at no point in that explanation did it involve someone seeing the big picture and realizing, oh, if our whole community could switch over to using money, it would be a lot better. Nobody had to realize that. They each individually were just acting in their immediate self-interest and yet, so they're being rational. They weren't just randomly trading stuff. Each transaction made sense on its own terms, but the whole thing taken together led to the emergence of money, all right? So that's Menger's explanation for the origin of money and so that's how you could explain how a community might start accepting gold or silver as the money and quoting prices in it, but then there's also the emergence of coinage and so here too, that's something that historically the private sector handled. So George Selgen actually was just a while ago now gave a great talk here at the Mises Institute just giving the history of private coinage, all right? So again, that's something that a lot of people will just assume, oh, the state must have been in charge that no, private companies first, private mints first did this and then the state came in and took it over and shoved them out of the industry. But originally, so again, what's the function of coinage? So they're using gold already and I've explained how that could have happened and then the issue is though, all right, if you go into a store and you just have a pile of chunks of yellow metal, that's cumbersome, that's hard to effect a transaction, especially if it's a big one, because then the merchant has to have special equipment to test to make sure that it really is gold and there's various things you can do and so you don't wanna have all the merchants being part-time chemists in your town that slows down trade. So the function of coinage is to just somewhat ensure the authenticity and to show what this thing is, right? And so the private mince function is it takes raw gold and silver as it were and stamps them into coinage. They have like the ridges around the circumference so that the reason for that in case you don't know is because otherwise you could like shave off the edges of it and so the coin slightly shrinks and you get little shavings of gold or silver. So that's the function of having those notched edges so that it'd be obvious if someone tampered with the coin. All sorts of things like that that signify the authenticity so you know this is an ounce of gold. That's what the, so the private mince are not creating money. That's important to realize. All they're doing is taking the money which is gold or silver, whatever it is, and just stamping it into a very recognizable form so that people can more comfortably trade it. Okay, what about banking? All right, so here too, for those who saw my lecture on the Rothbardians versus the Free Bankers, this is somewhat redundant but here I just wanna reiterate there's distinct functions of banking. You have demand accounts, like checking accounts and you also have time deposits or like savings accounts, things where there's genuine loans occurring. So those are distinct functions but as far as just right now thinking about checking account balances, just what's the reason for doing that? Well it's for security and also just convenience. So people are walking around town, they have gold coins and I'm saying the next level, the next evolution layer on top of this just to enhance transactions would be commercial checking services. Okay, so instead of having to walk around with let's say a thousand gold coins in your pocket, that that's heavy, jingling around, you basically have a bullseye on your back if you're doing that and so it'd be much safer to you go to this company called a bank and you give them your thousand gold coins, they put it in a secure vault and then they give you paper notes which are just easier to walk around it's easier to conceal or they give you a checkbook or in modern times obviously you have a debit card and so there the bank is just safe keeping your money and it's just easier for you then to spend it however you want. Okay, so there again it's pretty straightforward and we have both theory and history to show how this can emerge in the absence of the state and in fact central banks in practice they do the opposite of what the public thinks. All right, so the standard story of that the public hears as to why do we need a so-called central bank is to say oh well we go look at history that when we had unregulated private Wildcat banks they would just start up, they would issue notes that were claims on gold or silver and then the public wouldn't know any different and so they'd accept all these different notes from fly-by-night organizations, there'd be wild currency movements, there'd be depressions, financial panics and so the point of having a central bank was to ensure the integrity of the money and also to smooth out the business cycle. All right, so both of those claims are just empirically demonstrably false, right? That obviously the soundness of the money if by that we mean the purchasing power of it clearly has steadily declined with the advent of modern central banking and even using conventional measures the business cycle was worse with the Fed than before the Fed and what's funny is the way sometimes apologists for the Fed try to compare and show the relative stability they'll start in the post-war era, right? They'll assume that oh yeah what we mean by the Federal Reserve era is 1946 onward. You see how that's a convenient omission, right? And sort of like the Great Depression's a mulligan. Just say okay yeah well they were just getting you know getting their ducks in a row but now that you know they started a new job, okay they learn where the water cooler is, okay. Now no more depressions go. And then after the financial crisis hit which by all measures was the second worst crisis to hit in US history it was not to then say geez that's kind of awkward that the first and second worst crises to hit occurred when the central bank was allegedly smoothing out the volatile free market business cycle. No instead they were just, how did they spin that? They said well look it the financial crisis in 2008, 2009 was not as bad as the Great Depression so good thing we had the Fed there, right? And so because they're saying, think about it how perverse that is. They're saying good thing the Fed was there because otherwise the economy might have gotten as bad as before when the Fed was also there. All right so it's a not juxtaposition but in any event also even just on its own terms again some of this is redundant so I'll try to speed it up here but the point of central banking one of the functions that they'll say not critics putting words in their mouth but them probably declaring is the central banks a lender of last resort. And so if you endorse Mises's theory of what causes the boom bus cycle you don't want private banks getting the go ahead to go ahead and expand credit and don't worry if you get caught with your pants down the central bank will come in and provide liquidity. No that gives banks the incentive and the motivation to do what causes the business cycle. Okay another one, who would build the roads? All right so here as with a lot of this stuff the early turnpikes in fact were privately financed at least in the United States and only later did the government get involved and some of this stuff was funny like I've seen Alex Tabarak and some co-author or some co-editors I'm gonna forget their names has a book I think it's called The Voluntary City and they have an essay in there I forget who the author is on private roads and they have some examples to show like how did they finance them? So merchants in a town would realize oh if we pay and get the funding for a turnpike to come through here that will boost business. So some of the big merchants would all hit each other up and say let's kick in and do this and there's some examples that they have in the essay of like the fundraising letter as it were where some of the merchants are sort of shaming the other ones along the lines it would be unfortunate if the community learned that you're not willing to contribute to this product so they're not threatening them with anything besides just telling the truth to people but the idea being a shaming campaign to get some of these big merchants to kick in. So again just showing that's not something that's conventionally available in a mainstream mathematical model of the economy where oh you build a road and then you charge service unit prices for the use of the road and you know all right. So also in this realm sometimes people will say oh well gee everything would be discoordinated and you know maybe as you went from one neighborhood to the other all of a sudden red stop lights would mean go and all that sort of thing and you know there's nobody in charge of the English language right and it's not that stop you know STOP means go in some states and not in others. You see what I'm saying like everybody they have standards and things like that even in terms of like screwdrivers fitting screws. You ever think about that? Like there's not a government agency in charge of saying make sure that the screwdriver head fits into the screw. That's something that businesses have figured out standards all right. And so likewise it's not gonna be profitable if when your customers go from your roads onto your competitors roads all of a sudden there's a bunch of fatalities right that's not good for business besides other reasons. But what you do want though is you do want experimentation. So it's wrong to think that oh only if one agency is in charge of all the roads that we're gonna have public safety maximize. That's incorrect. You want there to be some experimentation because maybe right now the way people make roads is inadequate. And so the best thing I can do to get you to see that is when you get a chance go to YouTube and look up Hans Monderman. All right you can see the spelling here. And so he was a road engineer and there's this amazing video. So his the background on this guy his view is when you're building a road if you have to put up a sign that gives information to the drivers then that's an admission of failure. That's showing that your road is not properly designed if you have to sort of cheat and give exposition to the drivers in terms of signage. And so he wants to design roads that by their very nature keep drivers alert and minimize accidents. And so there was one where he designed this traffic circle. So when you're driving and you approach the traffic circle it's very disorienting. But that's good because you don't want the drivers fiddling with the radio or texting. You want them looking at the road and whoa what's going on with your immediate instinct when you're approaching this traffic circle is you slowed out. And he's saying that's what you want people to do. And so he had this great demonstration. There's a camera crew doing a story on his road designs. And so he approaches this real busy intersection or traffic circle I should say. Cars weaving in and out and then he's talking to the film crew and he turns around backwards to walk into the traffic circle that he designed. So he died but I think we should applaud. No, he was fine. So. So what? All right, but what happened though is so it was risky like cars were honking at him and swearing at him but they didn't hit him because the point was he knew that the road he had designed it in such a way that when you're driving that thing is a magnet for your eyes. Like you can't be looking away because it's so disorienting. And his point was that's what you want. You don't want drivers getting lulled into how like American drivers are on the interstate where you kind of, you know, doze out. I mean, it's, I have heard a radio host one time say he watches movies on interstates. Like he puts the laptop and the footwell of his car for real. And you know, it sounds nutty but you can kind of see how someone might do that. He's like, oh, I just glance down every once in a while and you know, you're a long stretch. But the point being that's not what you want people to do. At least if occasionally there is cross traffic because then it lulls people into a, you know, they doze off. All right. So that's that's the idea. So we don't really know what the optimal road design is. And I think sometimes people fall into the trap of assuming the way the government does it is correct and how would a bunch of private businesses mimic exactly what the government's outcome is? No, we don't want the government outcome. The government outcomes bad. There's not only are there more potholes than there should be. Like that's pretty a standard critique of all these roads are terrible and that's true. But it's also the design. And so like intersections where that are referred to as death traps, OK, that there's intersections where a lot of people die every year and in a market where the roads were privately owned. I think the company would have much more incentive to deal with that and to figure out why is it that people keep getting in deadly accidents at this intersection and they would do something about it. It's not that the government road engineers want everybody to die. I'm not saying that, but I'm saying the incentives in place in the how the system responds to that sort of information, if you will, and counteract it or deals with it. It's much more sluggish when it's a government monopoly that it's not that the mayor is going to not be reelected because one intersection has a lot of fatalities because first of all, the people in that town or that community don't view it as a government failure. They view it as, oh, wow, that guy shouldn't have been running the red light. Or, gee, that person shouldn't have been drinking before he got behind the wheel. They don't blame the design of the roads. All right. And so this is a point that Walter Block makes a lot, that he said if private business, and he compiles the statistics about how many thousands upon thousands of people die every year and road traffic accidents. And Walter's point is that if a private business had that kind of record under its belt, there would be congressional investigations. There'd be all sorts of regulation into this crazy industry where it's profits over people and they don't care about consumer safety, but since it's the government designing it, people just assume, well, that's the way the world is because everyone knows the government has to run the roads. Also, this isn't so much a big deal in smaller towns, but when it comes to large cities, there are systematic, predictable traffic jams, at least twice a day. In the morning, Russian people are going to work, and then so-called rush hour when they're going home. And depending on the city, I mean, it might be that many of the roads are just unusable for all practical purposes for four hours a day. When you just know it's going to be a parking lot, would be the ironic phrase people would use to show how slowly you move through. And so that right there, that's not just up. That's a feature of roads and that's how modern life works. No, that's government-owned roads. A traffic jam, just think about it, it's a shortage. It's showing that the quantity demanded of the available roads surface per unit time or however you want to quantify what the good is or the services is the quantity demand that exceeds the quantity supplied at that particular moment. And that's why you get a jam-packed full of people trying to squeeze in there. And so if the roads were privately owned, the immediate change would be they would raise the prices at least for those hours or those times of operation and that would speed up the flow. But then because there's open entry, if this were a private free society where all the real estate's privately owned, then if you're seeing these abnormally high profits from the people who own the few bridges and roads and so forth, they would build more. Okay, so it's in the long run, all that would be returned to the consumer and things would be cheaper, but the immediate short-term necessity, if every morning there's way too many people trying to use a bridge or a road to get downtown to go to work, the immediate thing that has to happen is the price of that shoots way up. And that's like a signal, if you will, to say, hey, build more roads. Other things too here, it's not, I mean, the stuff I'm talking about is real plain vanilla economist stuff, but it's also more sinister in terms of if you view the state, not as a bunch of well-meaning but bumbling folks who don't understand Econ 101, if instead you view the state as a gang of thieves writ large, well then you really don't want the roads in the hands of that institution, right? And you see examples of the stuff. So Bridgegate, in case you don't know what that is, so Chris Christie, when he was governor in his administration, there was a scandal and some of his operatives allegedly, or I think maybe they might have admitted it now, shut down a certain bridge lane of traffic just to cause traffic jams, to cause problems for the governor's political enemies. All right, and the scandal was that somebody, I think was sick in an ambulance and couldn't get across it because there was this big traffic jam that they deliberately caused just for political reasons, okay? And so that's the kind of thing we're talking about where normally when you're debating the merits of government versus private ownership of the roads, most people don't say, oh, and a reason you wouldn't want to have a governor have any influence is in case he's mad at someone else, he might have his lieutenants intentionally cause a traffic jam, just to spike that person, right? That you wouldn't even think of something like that and yet that really did happen. Also, asset forfeitures, this is becoming a pretty noticeable problem now where more and more people are realizing it where the police will pull a car over and do a search, and if there's a bunch of cash in the trunk, they assume you're a drug dealer and take your money and you have to prove you're not a drug dealer in order to get your money back. And I mean, it might take months, if ever, to get your money back where you have to prove you're not guilty of something, right? Again, the reason that's such an issue is because the government's control of the roads. If it were privately owned and the owners of the roads could set their rules, obviously it wouldn't be good for business to become well known. Oh yeah, don't ever drive down that particular, the Acme Highway because the employees of Acme that I guess you signed a contract implicitly when you first started using the roads, pull you over and take stuff out of your car and then there's a whole process to get your stuff back. If any company had that policy, everybody would stop using that particular company's roads. All right, and so you can see how that sort of thing would be minimized if you had competition among the roads. And the last thing I got here is involuntary blood draws. Again, agents of the state have checkpoints, they pull people over and there's cases where the police will have a medic or somebody there and say, okay, take some of this guy's blood because we think he's been drinking too much and the person refuses, doesn't consent to it, says, no, I want a lawyer, I'm not doing this. And it's an awkward situation where like the medical personnel are being ordered by the police, and I know some people that just told the police, no, we're not doing it. We don't want to take their blood, go ahead. But this patient is not consenting to this medical procedure, so I'm not doing it. So I'm just saying this kind of thing comes up and again, why is that even an issue? It's because the government controls the roads right now and that's a choke point for a lot of transportation. Okay, so continuing in this vein of transportation, imagine if airplanes or movie theaters ran their businesses the way that buses and subways work, it would look like that. All right, and so again, if you haven't been in a big city, this might not really ring true to you, but for those of you who have been in like you try to take the subway home from work at 5.30 p.m. in a major city, and it's like people really crush in to take up every available square centimeter of a surface area in the place, okay? And so that's, again, if a movie comes out, a blockbuster movie and it's all sold out, once you get into the theater, you have a nice comfortable seat. It's not that the movie theater sells five times as many tickets and so people are sitting on your lap and are scrunched into the theater and you can't even see, and yet that's how so-called public transportation works. Okay, so again, just look at the different incentives and just think through why is that? So again, it's not an issue of all, well, the demand's too high and that's why there's crunching in the subways, because when there's a blockbuster movie that comes out, the demand is high also, or if people wanna fly somewhere, you might get on the plane and say, wow, they sold every seat. This is a popular flight and you're grumbling that you're sitting in between two people and maybe their arms around your armrest, but that's night and day compared to what happens in so-called public transportation. All right, free and compulsory schooling. Government schools are a euphemism for prison in some communities and that's not funny. It's a tragedy, but in all seriousness, I mean just compelling children to go to school and again, some people say, oh, this is a conspiracy theory. I like Tom Woods's analogy on this one. He said, imagine like if Walmart ran the schools or people sent their kids to a school that was run by Walmart and they spent a lot of time in the history classes just holding up pictures of the founders of Walmart and the inner family and the major shareholders and look at how great their accomplishments were. And then in 1994, we had this initiative with our paper bags and you can imagine, how people would derive this, oh, give me a bit of self propaganda, yet when kids learn about the founding fathers and the wonders of America and then Abraham Lincoln did this and FDR did that in government schools, that's just, yeah, that's our history, right? And so that's also too, again, I'm speaking more to an American audience here, so I apologize for those who are from other countries, but from the US perspective, it's like Americans understand and believe that government schools indoctrinate children in every country except the United States. This is the one area where, no, no, they're getting me unvarnished truth. Okay, and so, and there's more and more people realize that homeschooling and other non-traditional approaches outperform typical establishment ones, you can look at test scores and stuff like that. Okay, also on this, just imagine, it's hard for me to get regular people to agree that way too many people are going and getting undergrad degrees, and that's what I think that it's partly just a cultural thing where not everyone thinks, oh, you have to go to college or else you're wasting your life. And also there's obviously all sorts of government subsidies involved that help perpetuate that outcome. I have had more success though if I say to people, all right, what if they were gonna ramp up the subsidies and insist that everybody get a PhD or most people try to get a PhD and you really haven't fulfilled your life, you're wasting, you're being lazy unless you go get a PhD. Imagine if that were the trend, you could see, most people say, yeah, that would be crazy because what would happen? It would cost a lot of money. There'd be a huge opportunity cost in the sense of people missing out on five, six more years of their potential work career by staying in school that much longer and also in order for this to be possible, getting a PhD in all these fields, they're gonna have way more degrees granted now. The standards would have to come down. It couldn't possibly be that just by spending more money, a bunch of people can get PhDs in physics or chemistry, or the standards would have to drop, all right? So that you can see how that wouldn't be good there. So I'm saying, all right, you think just right now we're at the optimum level of formal education being received and obviously I think not. Okay, safety regulation. Every time there's a crisis, foodborne illness or a plane crash, people will say, thank goodness we had the government agency that was in charge of not letting that happen, right? And I'm not putting words in their mouth. There was a plane crash when I was younger, it was a big deal. The company was called Value Jet at the time. They rebranded themselves after and I think it was in the Florida Everglade and they crashed and it was a big thing and someone wrote an op-ed that we ran in my local newspaper that was saying civil libertarians might complain about government funding but after a plane crash, the rest of us are glad that the FAA has its people working overtime. And so that's fine, but again, just think through what would have to happen for them to be upset with the FAA, right? Because there was a bad plane crash and the investigations found that it wasn't like it was just a freak thing. It was that the safety inspectors weren't following the protocols that they were supposed to. All right, and so again, that was chalked up to, yep, that's the free market for you when the FAA's inspectors don't do what they're supposed to do and there's a plane crash. There it goes, laissez-faire, right? So it's just this weird thing. So maybe it is true that others inadequate funding, but the point is what could possibly happen to show you that the FAA is doing a bad job and we should consider an alternative approach besides the fact that a plane still crashes on the FAA's watch. All right, so how could you get rid of that? You could have private insurance, right? So what if private insurance companies, what if when you bought a plane ticket, part of what you were buying was an indemnification clause saying if the plane crashes due to things besides acts of God, then the insurance company owes the estate of the people who die in the crash a million dollars or whatever. So if that were the case, then the private insurance company's on the hook and they're not gonna agree to that unless they know that the plane is following adequate safety protocols. So the insurance company then might send out inspectors to check to make sure that the safety logs are up to date. They might give random sobriety or drug tests to the pilots just to make sure that the pilots aren't showing up drunk, that kind of stuff. So a lot of what the government conceivably could do in terms of regulation, you can see private watchdog groups doing that as well. And again, the big difference is the incentive structure. If some private agency, some insurance company's vouching for an airline and it's not doing a good job policing the pilots or the maintenance crew and there's a crash, I mean, the victims are the people who die in the crash obviously, but also the insurance company now is gonna be out several millions of dollars, okay? So they have an incentive to not find themselves in that position. Whereas again, perversely, if there's a big plane crash, the people running the FAA can get more money from Congress because they can say we're understaffed, we need a bigger budget. It's true, maybe the higher ups might have to resign just to remove the scandal, but the institution itself does not suffer when it doesn't do its job. It actually perversely gets more money. Okay, there's a similar thing with the FDA. I'll be real quick on this point. It's standard for a free market economist to complain about the FDA and say, that's the Food and Drug Administration to say they have these unreasonably high levels of proof to jump through all these regulatory hoops to show, if you wanna bring a new drug to market, you have to do all these tests and show clinical trials to show such and such. And so drugs that could be helping people are held off the market unnecessarily long. It raises the prices. By some estimates, it costs more than a billion dollars, billion with a B to bring a new drug to market. And so you can see in that environment why there's only these blockbuster drugs that cater to something that's pretty popular as opposed to real niche products. And it just makes things really expensive. But they also commit the opposite error where the FDA will approve something that really is dangerous in a meaningful sense, because everything isn't, there's no such thing as a safe drug, all right? But the point when I say dangerous, I mean in the colloquial sense that if people knew the full risks, they wouldn't be taking it. And yet that gets approved and go look up the Vioxx scandal if you want and you'll see like how there was an insider who was saying that the FDA was, they approved it and they shouldn't have and then it takes a while for them to admit their mistake. And it sort of gives its blessing on something that it probably shouldn't have done so. Okay, what about vaccinations? This one to me is real simple, even though this is a hot topic now. So remember, everything's privately owned in a free society. And so every institution, every property owner can set the rules he or she wants. So like someone running a private school, if they want to, they can have the policy and say to the parents, hey, if you send your kid here, you got to agree to these particular schedule of vaccinations as put out by the local pediatrics group, blah, blah, blah. And if not, just take your business elsewhere. That's, they had the right to do that. And if some schools want to have a more open policy, they can do that. And so you let the market decide. So it's not that we need to come up with what's the libertarian answer to the vaccination question. It's just you leave it open and let institutions decide. What's funny here is I participated in a debate on this is that in some areas, you know, the case, like when it comes to contagious diseases and things, a lot of times, you know, you can see why there'd be a prima facie case for coercion to be involved to set up a quarantine. And then, you know, it's tricky to come up with, well, how would a free society handle that? But when it comes to just stuff like standard childhood vaccinations there, I mean, it is odd that prima facie, if a bunch of parents all do the right thing and vaccinate their kids, those kids should be somewhat protected from the unvaccinated kid, right? And so it's ironic that the people whose own kids receive the vaccination are often the ones really concerned about an unvaccinated kid playing with their kids when it's like I thought the vaccine was supposed to keep your kids safe, right? So there's that element. Now, what the response is, just to make sure you know it, the response from the people who think there should be coercion involved and the state has a role in forcing everyone to get vaccinated is they'll say, okay, well, there has to be this thing called herd immunity. And if a sufficient fraction of the population is vaccinated, then, you know, the disease or whatever can't get a foothold. But if we have too many that are unvaccinated and at any given time, several people have to be unvaccinated because there are certain medical conditions you might have or really young children who aren't yet ready to be vaccinated or would be dangerous if they took the vaccine. So that's fine, but then notice now, we're not saying the vaccine is safe or dangerous. The people who are pro-coercive vaccination are admitting there are some people in the population who can't get vaccinated because it would be dangerous for them. And so now you're just disagreeing with parents over where the line is to be drawn. You're saying, no, no, we think it's safe for your kid and the parent of that kid's saying, no, I don't. And that's what the argument's over. And so in general, the idea that we're gonna overrule what parents think is safe to put in their kid's bodies. I mean, that's pretty horrifying, I think. Okay, I got about two minutes here. Let me solve the immigration question in two minutes. You guys ready? Hang on. All right. So as it was something like prayer in school, there's no good answer here. Okay, that the people on both sides make compelling points. So when you're in a status framework, arguing over what the powerful, you know, institutional people running the state should do, everything's gonna be bad because it's involving the state, okay? What I would say, though, is there's also, though, no such thing as a right to freely travel, which sometimes people talk about, and that's if you think about, no, in other settings, that doesn't make sense. You can't just, the right to go anywhere you want. People own things. So let me just show you what the first best solution looks like and then you can try to figure out how to apply it in a status setting. But in a free society, private landowners set whatever policies they want. So when it comes to something like the US-Mexican border, think of it like this, okay, where you see all the different landowners who all conveniently have very short first names and it worked out well. Okay, so last thing here, you guys ready for this? So I'm saying people could set whatever policies they want and so some of them might be, what about Pam? What if Pam's crazy and she just lets, you know, Al-Qaeda throw parties in her backyard and they just come and go, is they please? Ready, watch how the free society would deal with somebody like Pan who's letting these people cross the Mexican border too quickly. Boom, you see how that works? Okay, so you need to get outside of the mentality of just thinking, oh, crossing this one line between Mexico and the US, if each parcel of land is privately held, it would be this sort of situation. So if somebody had really liberal policies, well their neighbors could then have more stricter ones and that would contain the problem if there really is a problem, okay? So again, that's the first best solution that you can quibble about, okay, what do we do in the current environment? Okay, that's my time, thanks everybody.