 It's time now for a very important item in the show, one I've been really looking forward to tonight. It's called Uncancelled, in which we tackle the topics others dare not. Tonight, could capitalism itself be the ultimate casualty of this pandemic? Is the fundamental basis of the free market economy now under threat? Joining me in the studio to reflect on this question is legendary US broadcaster, talk show host and co-author of Equal is Unfair, America's misguided fight against income inequality, Yaron Brooke. Hi, Yaron. Hey, nice to be here. Fantastic to have you on the program. Tell me more about the idea that the push for equality is actually unfair. Well, think about it, we're all different and it's wonderful that we're all different. You take any group of people, you put them on in any place and you leave them free and you come back a month later, you come back a year later, you come back 10 years later, what's the chance they're all going to be equal at the end of that? Inequality is the feature of freedom. It what comes about when you leave people the freedom to make choices for themselves. Some people choose to be teachers, some people choose to be financiers, some people choose to be entrepreneurs, some people work really, really hard, some people are lazy. Some people choose not to have a lot of money because they pick careers where they're not going to make a lot of money. Inequality is the results of freedom. And indeed, the only countries that have approached equality are either countries that are so poor where people don't have opportunities or not created any wealth or countries that have imposed poverty on their people in order to achieve equality. Equality equals lack of freedom. Equality equals poverty. Although the idea that inequality benefits the poorest is a hard sell, wouldn't you say? Oh, it is a hard sell, but it's reality. The fact is that under freedom where we have inequality, the poor are much richer than the middle class or the rich are in countries that are quote equal. So, if you look historically, wouldn't you rather be a lower middle class even a poor person in England or in the United States than the King of England 300 years ago with no running water, no sewage, no iPhone, how could you survive? So, no, I completely disagree. I think it is the poor who benefits the most from freedom. It is the poor, the rich will survive and they in a system we provide, but the poor actually benefit from the fact that there is production, there's innovation, there's entrepreneurship, there's progress, there's wealth creation. They rise faster than anybody else. And what are the implications of COVID measures in countries like the UK and the United States and across the Western world? Because we've seen, haven't we, more or less the rollout of communism, some would say, once viable businesses closed down, people being paid money to stay at home and the national debt exploding. It's truly unbelievable. Who thought that Western countries would tolerate the kind of statism and authoritarianism that all of our governments have practiced over the last 17 months, locking people down, telling people they can't leave their homes, healthy people, people who've not tested positive for a virus. It's okay to just lock them in their homes, no matter what. It's okay to tell them they can't work and it's okay. Uncle Sam, Uncle Johnson will provide you with your livelihood, we'll write you a check. Who knows who will pay for that check sometime in the future. We can regulate you, what you wear, what businesses are allowed to open, what's an essential service and what's not an essential service. Hey, the work I do is essential to me, but no, the planet in chief, the commander in chief is going to determine who's an essential worker and who's not. No, what we've seen is an unprecedented increase in the power of government. You know, even I think in wars, we haven't seen this attempt to control individual citizens to the extent that we have now. And it's a very, very dangerous precedent. Do you think we will ever reverse these extraordinary measures or are we stuck with a big state for the foreseeable future, Yaron? Well, ever is a long time, but if we're talking about the foreseeable future, I don't see a way out of it. There's nobody, nobody in the political spectrum in any significant country in the world today advocating for a Margaret Thatcher-like limited government or Ronald Reagan-like limited government. And even they, I would argue, were governed over way too big of a government and Margaret Thatcher didn't get to finish the job that she started. Well, yeah, Margaret Thatcher, Yaron, is widely misunderstood. Welfare spending under the conservatives in the 1980s exploded. Unfortunately, that's true. Margaret Thatcher is assumed to be far more of a free marketer and far more of a capitalist than she really was. Partially, I think, because of politics, she had to do it. And partially, I don't know where she would have, what she was committed to and how far she would have gone. But the fact is that to the extent that we didn't go further, to that extent, growth in the UK has suffered. To that extent, you know, poverty, I think, is bigger because the fact is that the way out of poverty, the way out of poverty is work. The way out of poverty is jobs. In order to have jobs, we need entrepreneurs, we need businesses that create those jobs. To have entrepreneurs, to have businesses where we need free markets, we need to get rid of regulations, we need to, you know, let loose those entrepreneurial and creative and innovative juices that exist among us, but are held back, restrained by government that intervenes in everything today. So, what is this state of economic freedom in the United States? It's very bad. It's very bad. It's, you know, the United States goes through these phases of more freedom and less freedom. But things are terrible today. Again, the government has taken on the responsibility of telling us when we can leave our homes and when we can't, what jobs we can do and what we can't in under what conditions. But more than that, we've seen what, for a hundred years, we've seen a slow decline in economic freedom. Yes, there have been short periods in which they seem to be moving towards greater freedom, maybe the last few years of Jimmy Carter and the first few years of Ronald Reagan. But with those exceptions, the steady movement is towards more statism and more government involvement in the economy. The book that includes all the government regulations of business only grows. It is, it never actually shrinks. Taxes, maybe they get lowered for a little while, but they always get more complicated. And of course, it's the complexity of taxes that creates the jobs for the bureaucrats and the lawyers and their countents and everything else and sucks dry those creative energies we talked about. So, the state of economic freedom really everywhere, sadly, is pretty dire. And what governments have learned, what people in power have learned is that we are willing to accept significant reductions in our freedoms if the circumstances seem to warrant it like COVID. Well, what's the next crisis? Where are we going to get the next crisis? And therefore, the next restrictions on our freedom, is it going to be climate change, maybe? Yes. I mean, do you anticipate possibly future lockdowns in order to save the planet and more extraordinary economic measures? Yeah, I mean, look at what, look at the floods in Germany and, you know, whether, because of climate change or other causes, there's always natural disasters. Is government going to take a much bigger role in the next few disasters? Well, the problem is, Jaron, they've now got a taste of it. Oh, yeah. Aren't they? They've got a taste of it and they've noticed that the public are rather compliant. And when you look at the World Economic Forum and you look at their agenda and what they're promoting, this is a powerful organization out of Europe. They are clearly promoting an agenda of much, much greater government involvement in the economy, much, much more control over what we can and cannot do. They are promoting a much more centralized government that will control everything. So it's hard to be optimistic as somebody who is supportive of the free market. Well, you have to slightly worry, Jaron, that these micromanaging national governments will be superseded by a sort of global state. I think that's what some people on the left would like. It's just not realistic. They can't, you know, they can't even get along within a particular political party, never mind across borders and everything. There's no way we're going to have a global government. My fear is a greater balkanization. If anything, you're going to see a little country split off. I mean, you've got, you've got the problem of Scotland here in the UK. I see much more division that way. You've also got the problem that I think the common people generally tilt towards a more authoritarian government of the right, and the intellectuals tilt towards an authoritarian government of the left. They can't even agree within any political entity, any country. No, we're not going to see more unity. We're much more likely to see more division, unfortunately. Well, Jaron, I'd love to bring my panel in, but my final question for you at this stage is whether or not we have had a taste of unchecked capitalism, possibly in the run up to the Wall Street crash, but also more recently with the credit crunch in 2008, 2009, and the global economic downturn in which we saw banks and other lending organizations completely recklessly lend money to people that would never pay it back. I mean, that was an example of economic freedom that went horribly wrong, wasn't it? God, no. No, the financial crisis of 2008 was a creation of government. It was caused by government policy. No bank lends money under the assumption they won't get it back. The only reason they might do that is if the government guarantees that they will get the money back no matter what, which is what happened in the United States. Look, banking is the most controlled, the most regulated industry in the United States. And I wouldn't be surprised if that were true of Great Britain as well. The financial crisis was caused by government from beginning to end. Every time you look, every time you pull a thread in the financial crisis and you go deep enough, what you find is another government regulation, another government control. What government regulations do is they create moral hazards. They create bad incentives. They cause private enterprises to do things that in a market they would never do. Like, why would I lend somebody money if I knew they couldn't pay me back? Only the government could come up with a scheme to make me do something like that. So, when we look at the financial crisis, it is a massive mistake to think of it as a crisis of capitalism. Look, in 2007, financial markets were heavily regulated. There was no free markets in America. There was no capitalism, let's say capitalism anywhere in the world. There was greed on Wall Street, but there was also greed on Wall Street in 2000 and in 1995, and there is today, Wall Street runs on greed. Nothing, there wasn't some elevated greed in 2007. It was the same thing that there always is. So, no, the financial crisis, like every crisis, really since the establishment of the Federal Reserve and central banking in the United States, has been caused by bad government policy. And the crises in the UK have been caused by bad government policy. And to scapegoat it onto private enterprise is one of the great tragedies in one of the great injustices of our time. Well, it's fantastic to have you on the show. You've got a ridiculous number of subscribers to your talk show on YouTube, and I'll sort of give the details of that at the end of our chat. But, Becca, what do you think about this? What do you want to ask, Yaron? Well, I can appreciate the argument that you kind of make your own luck in an equal society and you kind of sink or swim, but it doesn't seem to take into account any intersex of disadvantage whatsoever, whether that's on an individual level. So, coming from a disadvantaged family, your economic circumstances, your access to education, you can think about that in a national context. So, former colonies, the West Indies, parts of Africa, that were colonized by wealthy European nations and are still suffering the consequences of losing their resources. It sort of feels like capitalism works for the masters of the universe, but not for all of us. Well, but that's nonsense, because the masters of the universe, many of them were poor at some point. Many of them rose by bootstrap themselves, and that's just facts. You can go study it. Suddenly, under capitalism, when you look at the 19th century, when there was more free markets, more poor people rose through the ranks. But look, there's no question there's a variety of things that we're not responsible for. We're born with different genes. We're born to different families. We're born to different circumstances. But what's the solution to that? The solution to that is to penalize people who weren't born to those circumstances. The solution to that is to allow for maximum opportunities for poor people. The more opportunities you allow them, the more they will rise up. And I have to say something about colonialism, because that is ridiculous. Right? It's not like we went and colonized- Oh, it's ridiculous. It is, no, what's ridiculous is the modern interpretation of this. It's not like we went that some countries, like the UK, went and colonized rich countries. We went and colonized poor countries. They're still poor. They're poor primarily because of the choices they made. They have chosen to be ruled by authoritarian autocrats who are suppressing their own people. The reason Africa is poor today is nothing to do with colonialism, has everything to do with choices Africans have made for themselves. What they need is freedom. What Africa needs is capitalism. What Africa needs is the same set of institutions and the same set of rules and laws that we have in the West that allowed us to get rich. And unless you're willing to acknowledge that, what you're doing is perpetrating poverty in those countries, in Asia, in Eastern Asia where they've adopted the ideas of capitalism, of freedom, of individual rights, of democracy, they have flourished in spite of colonialism. So what we need is to promote the right ideas to these countries, not perpetuate victimhood. I think that the people of Rwanda, the people of Zimbabwe would probably suggest that they didn't choose to be governed by bloodthirsty dictators. Oh, but they did. The person who took over Zimbabwe, Mugabe, was a popular figure, was supported by most of the Zimbabweans. And, you know, now that he's gone, have they replaced him with a rule of law? Have they replaced him with a system of governance that would promote economic growth and economic success? The sad reality is no. So what we need to promote, if we're going to promote something in Africa, are the ideas that will allow them to become rich. And there's no reason Africa can't be as rich as we are and as free as we are if they have the right ideas. So you welcome the presence of the Chinese in parts of Africa, West Africa, East Africa. You think is that what they need to promote China? Tell us about China, Yaron. Is China a force for good or bad in terms of the world economy? Well, I think China is a force for bad. There's no question. In a sense, the West is becoming more like China. How did we respond to the COVID? Well, we looked at China. They did lockdowns. We did lockdowns. How we respond economically to many of our challenges. We look to China. We interpret China's wealth as a consequence of central planning. We embrace central planning. The fact is that China, whatever success it has, it had in those sectors and in those areas within China, where they allowed for freedom, where the government did not intervene, where the government did not promote central planning. And instead of learning that we should be encouraging more capitalism, we're taking the worst element of China and bringing and internalizing them. And to the extent that China is aggressively exporting their ideas, their ideas of central planning, their ideas of authoritarianism, their destructive force in the world. But we, instead of promoting good ideas, instead of promoting capitalism and freedom, we're either sitting on the backside and saying, we feel so guilty for what we did in the past when I intervening, or we're actually promoting the same bad ideas in these countries. We're encouraging them to build societies. I mean, one great example right now is climate change. Africa will not become rich unless it burns fossil fuels. It's also in the global south. It can't afford. It also can't afford for the climate crisis to continue because it's in the global south who are, and they are disproportionately affected by climate change. But that's just not true. But it is, it's entirely true. It's just not true. The fact is that the only way Africa can become rich and succeed given climate is if they have air conditioning. And to have air conditioning, and to be, you need air conditioning in order to build the kind of facilities that made it possible for us in the west to become rich. To build the conditioning, they're going to have to burn fossil fuels. They're not going to be able to live off of very expensive wind and solar. Now, if we were promoting nuclear energy to Africa, I'd be all supportive of that. But the idea that any country can thrive on wind and solar is absurd right now, and particularly our poor country. No poor country can survive that way. There's no accident that I think 30% of all carbon emissions today in the world are from China. They know that the only way they can become rich is by burning fossil fuels. So again, we're taking our guilt and we're imposing it on poor countries and making sure they stay poor. And that's a tragedy. And we are definitely going with a lot of totalitarian ideas straight out of the Communist Party playbook, Yaron, such as COVID vaccine passports, which is still being considered in this country so that you might have to demonstrate your medical status, your vaccine status, to get access to certain freedoms and rights, which is a very Chinese idea. I think you'll agree. Look, as we bid you farewell, what is your prognosis for the future of Western economies, the likes of the UK and America, Europe? Are you optimistic about the future? What do you think is going to happen? Well, I'm not optimistic about the short-term future. I think we have mortgaged ourselves to the hilt. We are playing around with the kind of central banking policies that have never been tried before. And we have no idea what the consequences of these are. We're printing money, taking on debt like there's no tomorrow. All this has to be paid back somehow. I think we paid back through stagnation. We paid back with no economic growth. We had 10 years of very low economic growth coming out of the financial crisis. Donald Trump used to brag about the wonderful economy he had. His wonderful economy grew at 2%. 2% is pathetic to put it mildly. So that would be a crisis in China, 2%. Well, it should be a crisis in the West. I mean, if you take the average poor person's wages, and you increase them by 2% over the next 20 years, versus increasing them by 4% or 5% every year over the next 20 years, that is a dramatic, massive difference. So the difference between 2% and 5% is not that little 3%. It's 3% compounded over 20 years, which is a massive number. So the difference is huge. We should be all up in arms about the low economic growth that we're experiencing. There's no reason for it. We could grow much faster rates. So I think we're going to have stagnation, maybe with some inflation, maybe stagflation for a while. But we head for stagnation and more financial crises until we learn the lesson. Freedom works. Authoritarianism, economic authoritarianism, never work. Central planning doesn't work in front of COVID or in front of anything. The West response to this COVID has been tragic. We'll see if they investigate it. We learned the proper lessons from it. Yaron Brooke, it's been brilliant to have you on the show. Yaron Brooke is a best-selling author, an amazing number of volumes on issues of economics and freedom, and also his incredibly popular talk show, which is on YouTube. It's called The Yaron Brooke Show, and I can tell you it's a very entertaining watch indeed. Thanks, Yaron. Lots more to come, my superstar panel, and tomorrow's papers today. See you in two.