 Welcome to a discussion of radical, fundamental principles of freedom, rational self-interest, laissez-faire capitalism, and individual rights. The Yaron Brooks Show starts now. Good afternoon everybody, or good morning, depending on where you are in the world. Thank you for joining me. This is Yaron Brooks, and we're on the Blaze Radio Network. I mentioned this last show, it was the end of the show kind of quickly, but this will be my, I guess, second to last show for the Blaze. I will, next week, next Saturday, will be my last show for the Blaze Radio Network. I've been doing this for six months, been great, I've enjoyed it. I hope some of you at least have enjoyed it. Truth is, just haven't been able to build up an audience with you guys, so, you know, we'll be moving on. Now, those of you continuing to be interested in listening to me, to my perspective, I'm certainly not giving up on doing that, and you can follow me on YaronBrooksShow.com. You can subscribe to my podcast on iTunes, on Stitcher, on any of the podcasting apps. I do three, four, five podcasts a week, typically, on a wide variety of different topics. So, anybody who wants to stay engaged, you can, of course, follow me on Facebook, like me on Twitter. Well, it's the other way around. Maybe it's the other way around. And, of course, subscribe to my YouTube channel, where there are thousands of videos. And I will continue to post both a podcast and a variety of different videos on YouTube in the weeks, months, years to come. So, I'm not going away. Anybody over there in the Blaze family who wants to continue to listen to YaronBrooksShow will be able to do so on a variety of different platforms. I just won't be here live on the Blaze radio network starting the week after next. All right, today, I really want to spend a big chunk of time talking about, I think, maybe, the most important event of the week, although it's getting almost no press. And that is what Larry Fink, the CEO of the world's largest investment company, said about the responsibilities of corporations. They're socially responsible and make profits and so on. And, you know, I think this has huge long-term implications for business in the United States, for business really globally. It has huge implications for capitalism and our perception of capitalism. All negative implications, by the way, just so we're clear. But nobody cares. It's got a little bit of press middle of the week, but it's gone. The government shutdown, that is much more important. So, let's talk a little bit about the government shutdown. I find the whole topic kind of boring and uninteresting. And hopefully, I can convince you that it's boring and uninteresting. It's theatrics. It's an opportunity for the Republicans to blame the Democrats for something. And the Democrats think that they have the marketing up by hand, which they might, given the polls. And it's an opportunity for them to blame the Republicans, but it's nothing more than the swamp. And I include Donald Trump in that. The swamp, engaging in what the swamp does, which is nothing. Which is just disrupt our lives and create a mooky world in which it's hard to tell what the hell is going on. You know, why is there a government shutdown? They basically agree on pretty much everything. They agree that government should spend more money next year than it spent this year. They might disagree a little bit about priorities. They're divided by priorities. Republicans want to increase defense. And the Democrats want to increase domestic spending. But it looks like they're going to agree on both of those. Just give them a little bit of time to get over the theatrics. And you will see a massive budget coming out of Congress in the weeks to come. That'll increase government spending across the board. Increase defense spending. Not sure we need to increase defense spending. You know, we have the mightiest, strongest, most powerful military force in human history. We're too scared to ever deploy it. God forbid we ever actually use it to defend ourselves, so-called America first. But let's invest more, massive amounts of waste. Oh, massive amounts of waste in defense spending. You know, the F-35 is probably the best example of this. And this is Republicans and Democrats under both administrations. You could cut the defense department significantly and still retain the United States by a big margin as being the most powerful military force in the world today and in human history. But that's not on the table, because Republicans have decided that they want to spend more on an inefficient, unproductive military expenditure. So, yeah, that's what we're going to get. We're going to get more military spending, and of course, to compromise with Democrats to get Democratic votes, because you need 60 votes to pass a budget. The Republicans would increase domestic spending, but that's not too much of a big compromise for Republicans. They love to increase domestic spending when they're in power. They love to stop increasing domestic spending when Democrats ain't power and pretend to be the political party of limited and small government. But as soon as they get control, as soon as they get government spending, goes through the roof, I give you as evidence of that, the Bush administration's, you know, first six years where Republicans had the House, the Senate, and the presidency and government spending, I think, if it was right, you know, just went through the roof, I think it tripled or something like that. I mean, some of that was defense because of the wars, but a lot of it was just plain old domestic spending, plain old programs that the government always spends huge amounts of money for. So, any hope that Republicans would actually stand for shrinking government, any hope that Republicans actually would stand for limited government, for reducing government spending out the window, I mean, there's nothing on the table about that. If anything, they're using things like CHIP, this children insurance program, which is unnecessary and unneeded and should be abolished along with all the other socialist forms of healthcare that the government provides across the board. They're using that just as a bargaining chip and of course they'll approve it, of course they'll extend it. There's no way Republicans are not going to fund CHIP or any of the other healthcare subsidies that are provided to low-income Americans of anything I expect to see an increase in Medicaid from this Republican Congress and for Trump to sign it. So, it's all at the margins, it's all disagreements at the margins, it's all theatrics, it's all trying to score political points. It's the equivalent of the so-called fake news awards that Donald Trump put out earlier in the week. This is all marketing, this is all show, this is all pretense. Nothing real is happening here. And of course, even if the government does shut down, nothing really happens. The last time the government shut down, I think it was 2013, and economists were predicting, oh my God, the economy is going to go in a tailspin because government spending is, we are told, it's such a big factor, big factor in economic activity and without government spending the economy would crash and decline and GDP growth and job growth during that period would decline dramatically. Never happened, never happened. That quarter, I think, actually had GDP exceeding expectations because actually probably all the businessmen cite a big sigh of relief that the bureaucrats weren't coming to work, that the regulators weren't coming to work and actually got some business done instead of the paperwork that it is required. So, you know, who cares? They're going to come to a deal, whether they come to a deal this weekend or next weekend or the following weekend, it doesn't matter. Republicans will compromise, not compromise because I don't think they believe in small government, but they will reinstate big government, reinstate big government programs, they'll cut a deal on DACA on immigration, they'll cut a deal on the child, you know, they'll cut deals everywhere. And now, you know, by the way, in DACA, I'm all for a deal that they cut so don't get me wrong. But it's all pretense, again, it's all show. See, we shut the government to defend Americans against those nasty illegal immigrants. You know, and maybe that scores some points with some of their constituency, but I fear that in these things, typically Democrats are the ones who win out because Republicans are supposed to be the party that believes in small government and limited government so shutting down the government or having the government do fewer things is no big deal. According to Republicans, it's Democrats that believe that government needs to be fully funded all the time and only grow and so on. And it plays right into their hands when the Republicans are so panicky about shutting down the government and are willing to compromise. It's also true that Democrats are much more consistent and find it easier to appeal to the altruistic kind of tug at the hot strings, kind of look at all those children starving, look at all those senior citizens who are not getting social security checks or whatever the program happens to be that is being reduced as a consequence of the government shutdown. They're much better at pulling at our hot strings to get us to think that they're the good guys and Republicans are the bad guys. So we'll see from a marketing perspective who wins out on this. It's hard to bet against Trump on marketing. He's really good at marketing. It's the only thing I think he's good at. But at the end of the day, I think this is all meaningless. At the end of the day, we'll get a budget that I, and those of us who believe in limited government and free markets and capitalism will hate. At the end of the day, nothing changes in Washington. And if anything, what this shows you is when the Republicans have the House, the Senate and the presidency, they still cannot really get their act together and govern. I mean, one of the reasons supposedly the governor shut down is because McConnell is struggling to figure out what Donald Trump actually wants, and therefore doesn't know where to draw red lines and how to actually negotiate with the Democrats. Well, that's true and not as hard to tell. But that seemingly, given what McConnell has said, seems to be right. They can't even get their own act together in order to do this. All right, we're going to take a quick break here. When we come back, we're going to talk about BlackRock CEO Larry Fink's comments to corporations, to American businesses about what they should be focused on in the years ahead if they want his support. He runs the largest investment company in the world. I think this was the most interesting event of the week and maybe the most meaningful event of the week from the perspective of our long-term prosperity. All right, you're listening to Iran Book Show. Here on the Blaze Radio Network, we'll be back after these messages. All right, we're back, everybody. And so I want to talk, and you're going to have to be patient with me in this story because I know this is not the sexiest thing. This is not something that gets people's emotions all rolled up because, I don't know, there's carnage in the streets of America, there's illegal immigrants. It's not something that's all couched in these terms. It's also not necessarily always a white versus left thing or Democrats versus Republicans. So it's not something your tribal juices get going at or some people's tribal juices get going at. It's also complicated. So it requires a little bit of focus and a little bit of, you know, paying attention and thinking about it. It's not crazy. It's not crazy. It's not emotional. It is emotional. It is crazy. But it's not obviously so. And this is the whole issue of what's called corporate social responsibility. And the reason this has come to the forefront is because of a letter published, an annual letter that it published by Larry Fink. And now Larry Fink is the CEO of BlackRock. And most of you, and this includes me, and I'm in finance, don't really kind of get, what is BlackRock? Who cares who Larry Fink is and who cares BlackRock? Why is this of any interest? Well, the thing is that BlackRock is the largest asset manager in the world. In other words, BlackRock holds, basically invests your money. So your pension plan, whatever your money is, your 401k, whatever that is, or even maybe some of the money you invest individually, most of that money, or a lot of that money for a lot of you, goes through BlackRock. BlackRock manages over six trillion. That's what the T, trillion dollars. That's more than the U.S. government spends every year. Well, I don't know about next year, but spent in the past, in an annual basis. BlackRock invests for its clients, which are individuals, mainly institutions, pension plans, and so on. And it also owns something called ice shares. Ice shares is, ice shares are ETFs, are these, what do you call them, indexes that follow different investment categories. And that's huge. That's like 30% of their business. They have almost two trillion dollars in ice shares. So here is a guy, or here's a company, that basically is the largest investor in the world. The largest investor. These guys are bigger than the Norwegian fund that invests all their oil money that Norway has. That's about a trillion dollars. They're bigger than the Saudi investment fund. They're bigger than anybody, anybody. So they have a lot of say. They own a lot of shares in companies. And they have a lot of say in how those companies are run, they share holders and they get to vote. And they get to vote proportionately how much they own in that company. And while I don't think they have many concentrated positions, they have small positions in a lot of companies because they do a lot of indexing, they have an enormous, an enormous voice in how business is run. And if they take a position that is wrong on how business should be run, and if they apply that to how they vote for directors, to how they vote on board issues, to how they vote on who should be CEO of a particular company, they can have a disproportional impact, a massive impact, on how American business functions. But it's even more than that. BlackRock is considered a model. It's an incredibly successful business. It has only been in existence for 30 years and it is the largest investor in the world. Larry Fink is considered a genius, is considered a master. He is looked up to by many in the investment committee, many in the world out there who deal with corporate America. Look up to Larry Fink and he has the ability not just to directly affect the way businesses run in America, but he has the ability to influence many others who own stock. And it doesn't take much because this issue of corporate responsibility, and I'll get to what that means in a minute, is already a big issue for people like Culpers, which is the big, this is the big pension plan in California and CalSTRS, which is the other big pension plan in California. Those are the two biggest pension plans in the country. They already are putting pressure on corporations. We'll talk about one such example of pressure. They're putting an apple later on. They're already putting pressure on corporations to be so-called socially responsible. And now they've got the largest investor in the world behind them. And it's more than that even. What Larry Fink is doing very effectively in this letter is taking a moral perspective on the issue. He's trying to capture the moral high ground. Which could get him the support of many Americans. Which could get him the support of many people in politics who ultimately would love, love to try to implement some of the things that Larry Fink is trying to do voluntarily. They would love to do by the use of government fiat. We haven't seen much talk of implementing stakeholder responsibility or social responsibility rules through government. We haven't seen that, I'd say, since the mid-1990s when it was very popular. And there were a lot of proposals that all failed, but a lot of proposals. And since then, that front has been quiet. I wouldn't be surprised if this reignites that debate and encourages certainly Democrats in the House and Senate to reintroduce these ideas. Maybe not to be implemented why Donald Trump is president, but who knows. But to be implemented by a future administration. So this has vast cultural implications. It's also, I find it interesting in some respects that while these ideas have not manifested themselves explicitly in legislation, they have since the 90s grown in influence. So that the whole movement is now bigger in the voluntary non-cursed world and politics is becoming less and less relevant. So let's talk about what this means. The fundamental idea here is that corporations should not be primarily or certainly not exclusively focused on profits, on making money. Or another word that we finance guys like to talk about is shareholder wealth. They should not be primarily focused on maximizing shareholder wealth, but that they should rather be focused on some social agenda. They should try and do what they can to make the world a better place. All these proposals, position making money and making the world a better place, at least in opposition or as alternatives. Now I will argue after the break probably that making money is making the world a better place. But all of these, all the people who propose stakeholders or all the people who propose social responsibility argue that no, profits is not a means to making the world a better place. The role of a corporation is to make the world a better place. Therefore, a corporation should not engage in profits. Now, everything is wrong about what I just said. Every piece of that logical or illogical syllogism was wrong. But that's how they think. And they're trying and have been trying for a long time to convince the American people and to convince our politicians and to convince most importantly business leaders that this is true. And I think to a logic stand, they have succeeded and I think that Larry Fink's letter is a milestone in the ability of this leftist ideology to convince us, to convince corporate leaders, to convince influencers that profits are evil, that, well, not evil, unnecessary evil, that profits do not lead to good and that what we need is alternative policies, additional policies and additional focus for management, additional to profit for them to focus on society. Or in other words, words they use here, that companies, and this is to quote Larry Fink's letter, companies might benefit all of their stakeholders and including, so this is not all of the stakeholders, it's just including shareholders, employees, customers and the communities in which they operate. Of course you could add to that suppliers, government and on and on and on, I don't know, the world economy, you know, the world's poor. I mean all the stakeholders, there's no limit how many stakeholders a company has. A stakeholder is anybody who has some stake, some interest, some relationship with the company, successful companies, I mean think who is not in the world, in the entire world, the stakeholder of Apple. Who is not in the entire world, the stakeholder of Facebook. So basically what they want is to say, shareholders, yeah, we care about shareholders and we care about profits, but shareholders and profit are just one among many, many, many considerations that a company has when making decisions. What he's, you know, the kind of the key sentence in what he writes is, society is demanding through him, through the words of Larry Fink, right? Society is demanding that companies, both public and private, serve a social purpose and that they make a positive contribution to society. Although when we come back we'll try to analyze this, tell you what it's like to run a corporation for stakeholders, we'll be right back you're listening to a run book show. All right, well, we're talking about Larry Fink and Larry Fink is the CEO of BlackRock, a company most people don't even know exists, but yet is the largest investor in the world. It accumulates over $6 trillion of your money, of all of our money, through selling mutual funds and ETFs and all kinds of instruments and invest those into companies. Seven, sorry, six plus trillion dollars, just an unimaginable amount of money, greater than the U.S. budget on any given year. This company controls and now it controls is a little harsh because a lot of it is an index fund so they really can't decide to pull, they have to just follow an index, but generally he is an incredibly powerful person in Wall Street, on Wall Street. Somebody who has a lot to say, even though I think BlackRock is maybe headquartered in San Francisco, that might be the case, but he has a lot to say about how corporations are going to be run, how business is going to be run and he has come out swinging, advocating for social responsibility. Now he's no idiot. And so he's trying to, in this letter that he writes, he's trying to present it as if you focus on your social responsibility, you focus on all these stakeholders, profits will also increase long term. He never justifies that, he never explains that, he just asserts it. And indeed he says all this is about strategy, we need to think long term. The problem is that if you focus just on profits and if you focus just on shareholder wealth maximization, that's a short term. What we need is a long term strategy. What we explain to people why their sacrifice is good for the greater good. That's my words, not his. But that's essentially what he wants to do. Here's the kind of things he wants companies to do. Companies must ask themselves, what role do we play in the community? Why do you have to ask yourself that if you're producing a great product that people around you want to buy or you're running a store that people around you like to come in and engage with you? Why do you have to think, what role do we play in the community? Why not think, how do we make the store as profitable as possible? How do you make it more profitable? By creating more values for more people. So by maximizing the way you maximize profits is by creating more value for more people. So what role do we play in the community? One question business leaders should ask themselves. How are we managing our impact on the environment? What the hell does that mean? The human environment? The environment for flies? The environment for what? For mosquitoes? Hopefully we're impacting that negatively. Are we working to create a diverse workplace? Why is that important? Does that increase profitability? Any research that shows that diverse workplaces are better? Is it true that in China town it's better to have a restaurant with a bunch of Scandinavians? Does that work better? How do you decide? What does diversity have to do with anything? Are we adapting to technological change? Sure, so he sticks in something. This is all I'm reading from his newsletter. He sticks in something called technological change that everybody's for. We should be adapting to technological change. Any business people disagree with that? Of course everybody agrees with that. Are we providing and retaining the opportunities that employees and our businesses will need to adjust an increasing automated world? I mean, you could view this two ways. Are we firing the people who can be replaced by robots? That's probably not what he meant. That's what I would mean. Are we doing enough of that? That's what I would mean. He means, by this, are we retraining employees? Are we compensating them so that they, you know, so that when the computers come and replace them they will not be hoed too badly? What does that have to do with long-term strategy? What does that have to do with long-term making the company more profitable and better off? Nothing. Are we using behavior, this is a good one, are we using behavior finance and other tools to prepare workers for retirement so that they invest in a way that will help them achieve their goals? What does behavior finance and other tools mean? Here's my interpretation of that. I'll read it again. Are we using behavior finance and other tools to prepare workers for retirement so that they invest in a way that will help them achieve their goals? This is the way I would write it. Are we manipulating our employees to invest in a way that we believe is good for them? Are we, big brother, are we the philosopher kings encouraging or incentivizing or manipulating our employees to behave in ways that we think are good for them? That's what that means. In other words, we corporate leaders, we must start taking responsibility for our communities because they don't know what they're doing. We must start managing the impact on the environment because anything man does to the environment is probably negative and we need to control all these people. We need, as corporate leaders, to embrace a leftist political ideology on diversity and among taking care of employees in the way that's... And that, only that is promoting social well-being and is right for the world. It really is. Wow, it is so insulting to so many people, to so many business leaders, and it is just plain wrong. And what it's trying to do, what it's trying to do is divorce profits from well-being. It's trying to divorce good business practices from American business. And it's trying to establish an intellectual elite, a group of philosopher-kings who will then tell us what products are socially acceptable and what products are not socially acceptable. And by the way, you could flip this and turn this into a manifesto from somebody who's on the right. And they would say, here's what they would say, company must ask themselves, are you employing or facilitating the employment of illegal immigrants? That would be socially responsible from a right-wing pseudo-conservative, whatever you want to call it, perspective. And when they run their companies, that's what they would do. Are you creating a workplace, hospitable to white males? We're not quite there yet, but you can imagine. When the Larry think of the right doing this, I mean the danger of bringing politics into the business, not just into the opinions of the CEO, not even into the charitable contributions that the corporation might make, but into the actual running of the business that's run the business based on a leftist ideology, a political ideology. Let's run our business based on right-wing political ideology. Because it's good for society and society is the legitimator of it. It's just horrific. It's scary. It is absolutely scary that we have come to a place where this is how we want to control our businesses. And we're not quite ready to give the government that control, so we're giving it to Larry Fink, who's now going to go around boards of directors to emphasize that their job is not primarily to maximize returns for shareholders. No, no, that's too short-term thinking. That's focused on quarterly earnings. No, no, they should think long-term. And long-term means holistically and holistically means the sacrifice of shareholders to every other group of, I don't know, any other group who would like to take control, a group who would like well to be distributed in their direction. Now, when we come back, we're going to take a quick break. I want to run an exercise by you. I want to see what it would mean to run a business based on stakeholders, based on treating stakeholders as equals, not based on maximizing shareholder wealth, but based on treating all stakeholders, and after that, what I want to do is I want to talk about what profit maximizing means and what maximizing shareholder wealth means and is it this damaging, horrible, negative phenomena that people like Larry Fink try to imply? They'd never come out and say profits are bad, but they imply it. They imply that it's not socially responsible. Well, isn't it? It's not sustainable, or is it? All right, so we got two things. One, we're going to try to run a business, together, all of us, we're going to try to run a business based on stakeholder theory. And then we're going to talk about the benefits of shareholder wealth maximization, the benefits of maximizing profits and why that is the only moral thing to do and why it is the only legal thing to do, why all businesses should maximize long-term shareholder wealth. That's what they're in business for. All right, you're listening to the Iran Book Show. We're going to take a quick break on the Blaze radio network. Iran Book. All right, so this is how The New York Times in an editorial, a very good editorial, pretty objective about this. This is the headline, New York Times. BlackRock's message, contribute to society or risk losing our support. And that's exactly the message. Of course, and they go on to say that what he means by contributing to society is not just make money but other stuff. He says, this is to quote, think, to pass over time every company must not only deliver financial performance but also show how it makes a positive contribution to society as if delivering financial performance doesn't make a positive contribution to society. He's setting those up as opposites. If you look, one of the things Fink has promised is to expand his investment stewardship program and hire many, many more people into that group. And this is a group that monitors companies and works with managers. And here's one of the things they do. They do three things. This is number three. Provide specialist insight on environmental, social, and governance considerations to all investment strategies. Now, guess what environmental and social considerations are going to be if, well, the talking lines of the left, very, very dangerous stuff and stuff that's going to be embraced by American managers throughout. Now, I want to do this exercise. I used to do this with my students and see what you think of this. All right, let's imagine that we have a particular business decision to make. And we're not going to make it based on profits. We're not going to make it based on long-term shareholder wealth. We're going to try to make this investment decision based on stakeholder theory. Now, I know some of you are Trump supporters, so we're going to do this from two perspectives. We're going to do this if you're a leftist who believes in stakeholder theory or if you're a Republican or a Trump supporter who believes in stakeholder theory. And let's try to make some corporate decisions. One corporate decision. One simple corporate decision based on this. But this was the same corporate decision that I used as examples 30 years ago. So this is not a special one for Trump. This one has been around forever. Okay, and this is the decision. You're a manufacturing company. I want you all to think about this. You're a manufacturing company and you are trying to decide whether to move manufacturing to Mexico, right? It's perfect for the Trump era. Trying to decide to move manufacturing to Mexico. Now, let's make this assumption. You've run the numbers. You've looked at profitability. You've looked at cost of transportation. You've looked at the drop in productivity that will probably happen when you move to Mexico. You've looked at all the factors that are involved in moving the factory to Mexico. And from a purely financial perspective, this is a win. This is a good thing. It'll maximize long-term shareholder wealth. It has a greater value financially than staying in the Midwest, wherever you happen to be. All right, so if you're a shareholder maximizer, then the answer is easy. You move because this will maximize shareholder wealth. But now what do you do, and what do you do if you're trying to maximize stakeholder well-being? So this is the kind of thinking you have to do. Who are the stakeholders? And they usually have go on the board and ask people, okay, shout out stakeholders. Who's a stakeholder? Anybody you think is a stakeholder? And they'll say customers are stakeholders. All right, good. Well, who else is a stakeholder? Well, suppliers are stakeholders. And who else? Well, obviously employees are stakeholders. And who else is a stakeholder? Well, the community is a stakeholder. Who's the community? Well, now you get a little fuzzy, right? Which community? Which community? Right? Is the community being served right now? Is it the community of all customers in the world? Is it the community where your factory's going to be in Mexico? We'll get to that. So what is community? Who is the community? That's a tricky one. But okay, community. Who else? Anybody else? There's no... I mean, this is a realistic decision that every company has to make every day whether to keep its manufacturing in the Midwest or move to Mexico. We're not talking about reduced or delayed. We're not talking about politics. We're talking about simple business decision. Given the circumstances today in the United States, given the circumstances in Mexico, we're going to move. Should we move? Is it an economic decision? Well, the economics, you run the numbers and you take into account the drop in productivity, you take into account maybe workers are more happy, less happy, whatever. You take all that into account and the numbers suggest, yes, you move. Now you make a list, because you want to be socially responsible, you make a list of all your stakeholders, customers, suppliers, employees, community, of course shareholders. Who else? I mean, bondholders. Okay. Okay. Well, let's stop there. I mean, you could go on and on and on. There are plenty of stakeholders. Let's start with customers. A customer is going to be better off if you move to your plant, to Mexico. The profitability is going to go up. Does that mean customers are better off? Well, that depends. So you have to do an analysis of your customers. Some customers are going to be pissed off because they're Trump supporters and they don't believe that you should ever move to Mexico. American jobs for Americans and they're going to be emotionally upset. So that would score them a negative and negative point. But, you know, overall, if the company's healthier and you know, might mean that you might be able to give customers a price break, it might mean that you could, you know, that your product over time could improve because you'll have more money to invest in those products. I would say most customers are probably going to give this a plus, thumbs up. We're better off if it comes out, right? All right. Now remember, stakeholders, this amorphous, anybody related to the company, it doesn't, as we'll talk about, it doesn't really mean anything, but okay. Suppliers, what about suppliers? Are they happy with the move or not? Well, some of them are unhappy. Some of them are downright miserable because you're going to move to Mexico and that's far away and you might switch suppliers. Instead of having suppliers in Wisconsin, you might now switch the suppliers in Texas. Or God forbid, you might actually switch the suppliers in Mexico. So some of your suppliers are going to be really depressed and they're going to have a negative impact. But what about your new suppliers and should you take into account new suppliers? Well, certainly your new suppliers in Texas, if you're an America first guy, you'll find with that, so switching them from Wisconsin to Texas, that's okay, but what about suppliers in Mexico? Should we count the positive impact on suppliers in Mexico you don't yet have? Now, if you're a so-called globalist, an anti-concept, by the way, a non-existent idea, but if you're a so-called globalist, oh my God, suppliers in Mexico, that's terrible. We don't care about them. Oh, you do care about them. Sorry, the globalists love suppliers in Mexico, right? So you do care about them, right? But if you're not a globalist, if you're a Donald Trump fan, you don't care about suppliers in Mexico, so it's a negative. So hard to tell. Employees. Well, clearly the employees in the Midwest lose, so that's a negative. But employees in Mexico might gain, but again, do you care, don't you care? Community, community, maybe, I don't know what that means even. How do you measure the community benefit? But yeah, the plant closes, there's a blight. People lose their jobs, that's bad for the community in the Midwest, good for the community down south and good for communities in Texas, maybe. Shareholders, it's just a plus, right? It's all good. Bondholders is not clear, you might be moving, you might be taking on more risk, that might be a negative, but financially it might be a positive. All right, so you got all this, now what do you do? How do you make a decision? How do you actually decide? Whether you're a leftist or right wing or whatever, how do you decide? Do you add up all the negative signs and if there are more negative signs and positive signs, you don't move or do you add up all the positive signs? You know, what do you do here? How do you make a decision? And there is no way to make a decision. This kind of thinking is self-destructive. This kind of thinking is debilitating. This kind of thinking is paralyzing. You cannot make up your mind. And you don't. Companies who run like this don't survive. Companies who run like this die. There's no guiding principle. Societal benefit? Where's the societal benefit? Where is society? Who can I touch the society? Who can I ask the society? There is no way to do this. All right, when we come back, we'll talk about shareholder wealth maximization. We'll be right back after these messages. Hey, I loved how that last news briefing started out. The U.S. government is closed. Wow, that would be cool. We should close three days a week. Just generally, long weekends, every week completely closed, no services. That would be good. That would be good. I mean, keep the military going, you know, but everybody else can go home, I think. Judiciary probably needs to keep going. We probably need more judges, not fewer judges, but everybody else, just keep them home. I mean, I think the U.S. economy would thrive. 40% less government. Let's just, you know, 40%, no. Take out three sevens. Even four sevens wouldn't even be better of the U.S. government, and let's see what happens. So the U.S. government is closed while I am four governments generally. This government, this kind of government, this size of government, this scope of government, shut them down. Shut them down. I don't think anything bad is going to happen. A lot of good stuff can happen with the government, not in my face, in your face. All right. So we've talked about this ridiculous notion of social responsibility. Let me say, you know, my real objection here to social responsibility, what does that mean? Who are you supposed to be responsible to? Who is society? As far as I know, there's you and you a bunch of individuals. There's a bunch of different people with different minds, thinking. And a business has to appeal to you, whether you're a customer, supplier, an employee, it has to convince you as a shareholder or a bond holder that our interests are aligned. Otherwise you won't do business with me. If I'm a shareholder and I'm not there to maximize your wealth, you can take my money out and put it, you can take your money out and put it somewhere else. If I'm a bond holder and I don't convince you that it's a good investment and that it's a safe investment because bonds tend to be safer, then you'll pour your money out and put it somewhere else. If you're an employee and you think I treat you badly, what will you do? Quit, resign, leave, go somewhere else. If I stop paying my suppliers, what will they do? If I treat my customers badly, what will happen? So the beauty of the corporation as exists in the world in which we live is that it is, while it has a single focus and should have a single focus, that determines all its decisions, like whether to move the plan to Mexico or not, which is maximizing long-term shareholder wealth, every one of its other relationships are voluntary. You don't want to deal with them. You don't like what they do. You don't like their product. You don't like their salary. You don't like their risk profile. Don't interact with them. Everything is voluntary. Now it's true. In moving to Mexico, you'd have to fire employees in the Midwest. That's right. It's not their company. It's the shareholders' company. They are the owners. I mean, nobody would ever think of running the local corner grocery store for the sake of the three teenage employees that are working there. And to hell with the elderly couple who actually owns the store. Now, we completely agree that it's the elderly couple who own the store that should make all the decisions about the store and the store will basically be run for them and that they get to pay the teenagers who will work for them based on how productive they are. And if they're not productive or they steal from them or whatever, they'll fire them. Or if it turns out that there's an economic downturn and they can't afford these employees, they'll let them go. We completely understand it when it comes to a small business, but the same principle applies to a big business. Shareholders are owners. Shareholders have the legal right, the legal claim against the assets of the business, against the cash flow of the business. And legally, fiduciary... That's a word I can't pronounce. From a fiduciary perspective, it is managers' responsibility to run the company for the sake of its owners. That's not managers, by the way. It's not even the board of directors. It's the shareholders. Now, we know who the shareholders are. We can ask them what they want. They want more money. That's why they're in the market. And if they don't want more money, they can leave, they can go to another company. If they have some social agenda, if they have some environmental agenda, they have some so-called social justice agenda, then they can go and invest in a different company. But the job of managers, the fiduciary legal responsibility of managers, is to run the company for the sake of owners, which means to maximize long-term shareholder wealth. Now, what does that mean in terms of how they treat their employees? I used to ask this to my students, and I used to say, yep, I don't care about employees. All I care about are the shareholders. So I strap my employees to their machines. I whip them three times a day. I only open shackles up maybe to let them go to the bathroom. And my students used to go, no, no, no, no, that's ridiculous. And I'd say, why? I don't care about employees. I only care about shareholder wealth maximization. They'll say, yeah, but you can't maximize shareholder wealth if you treat your employees that way. Why? I say, I mean, put aside the rights violation. We're playing here because they won't be productive. Because you're much more likely to get productive employees and to get hard-working employees, to get motivated employees, to get incentivized employees, if you pay them based on how productive they are, if you reward them when they do well, if you fire only those employees who are no good, if you actually run the business in a just way, if you treat your employees justly, which means treating them based on what they deserve, which means in a corporate environment, treating them based on how productive they are. Oh, so you mean if I don't consider stakeholders, and I only so-called stakeholders, because I don't think that's a term that has any real validity, people, you know, all these other groups, if you don't consider employees in your decision-making, if you only consider shareholder wealth maximization, you still treat your employees pretty well? Yeah, you do. Now, again, not everybody is the same. Now, John Mackie, who is the CEO of Whole Foods, likes to talk about social responsibilities. He claims to be a big capitalist, but also an advocate of social responsibility, and he says, look, at Whole Foods, I pay my employees a lot of money, I give them these great benefits, I do all this stuff. And, yeah, he does. And he charges a fortune for the products. Have you ever been in a Whole Foods? Have you ever seen how much money that costs? So yeah, I'd say if you can afford to shop at Whole Foods, all the power to you. And that makes it possible for Mack to pay his employees a lot of money, whether they're with it or not, I can't tell. I assume they are. I assume he gets higher quality employees. I assume they're better at picking fruits and vegetables, because you get better fruits and vegetables if you're paying more at Whole Foods. I assume the cash registers are more polite and nicer, though I'm not convinced of that. And it's worth as well to pay them all this money. And maybe it's all just a marketing ploy to bring in all those feel-good leftist soccer moms and pops to Whole Foods to buy the really, really expensive fruits and vegetables and other stuff. But if you're running Walmart, you can do that. You can't pay your employees a huge amount of money. You can't give them fabulous benefits, because you're selling products very cheaply at a very low profit margin. And you're catering to a population, low or middle class poor people in America, who can't afford to buy the stuff at Whole Foods, who can only afford to pay a lot less money. And as a consequence, your business model is completely different and you treat your employees differently, still fairly, still justly, but fairly and justly in the context of the specifics of your business. For John Mackie to say that his model at Whole Foods is exportable to all other companies is ridiculous. What about suppliers? You know, if your maximizing shows the world, you don't care about suppliers, right? You don't pay your bills on time. You treat them really badly. You don't answer their calls. No, of course not. My students always yelled at me. No, no, no, no. Because otherwise you can't make maximized profits because your suppliers will treat you badly if you treat them badly and they won't supply you with the stuff and you need the stuff and you need good stuff in order to make good products so you can sell to customers so that you can make money for shareholders. Oh. And no, but the customers, we really don't care about customers if we're maximizing shareholders. Well, you get the point. The point is that if you actually want to have a positive impact on society, meaning the individual, the rational individuals within society who are interacting with your firm, then the best way to have a positive relationship with all those people that interact with your firm is to treat them justly in the cause of maximizing long-term shareholder wealth. Now, that doesn't mean you won't hurt them sometimes. Hurt them in the sense of you might drop a supplier and take on another supplier. You might fire an employee and take on another employee. That's why I say justly. But the context is I'm making money. I'm making a profit. I am maximizing shareholder wealth. That is moral. That is noble because the only way to do it, well, we're going to take a break here. And then when I come back we're going to talk about the only way to make money. The only way to make a profit. What's a profit model indicates about what you are doing. All right. You're listening to your show on the Blaze Radio Network and we'll be right back. All right. We're back. And thanks for sticking around. We're talking about this whole idea of social responsibility and what it's about. So how do you make profits? You know, because it's positioned as either you focus on profits or you focus on these other things. And I say you focus only on profit. But how do you make money? How do you make money? I like to ask in my talks, how do you become a billionaire? What does it take to be a billionaire? Well, the only way to become rich, the only way to make a profit is to really engage your mind in productive activity in the creation of values. Creation of values. The many, many, many people out there want. The many, many, many people out there are willing to pay you for. How much are they willing to pay you for? Well, you're not going to make a profit unless they're willing to pay you for it more than what it costs you to produce, which is not easy. It's easy to produce stuff and not be able to sell it because you're charging too much because you're cost of production are too high. But the challenge is not just to have an idea, not to invent something, but then to be able to produce it cheap enough so you can make a profit when you sell it. And then to sell it to so many people that you're going to make a lot of money because if you can sell something to a billion people, even if you're only making a dollar on each thing, it's a billion dollars, a profit. I mean, the dollar is a dollar profit, right? Now, what does it mean when people buy your product? What does it mean to buy your product? It means that those people believe that this product is worth more to them than what they're paid for it. So to sell a product to somebody is to make that other person's life better. It's to improve the world being, at least what they think, what they intend of the person buying the product. Trade is a win-win transaction when it's thoughtful. I buy stuff that I believe will make my life better. Buy more than holding on to the cash. I'm better off for buying the product. I'm better off for having an iPhone in my hand instead of the money. I'm better off for having a little for bread in my hand rather than the money. So the only way you can become profitable, in other words, the only way you can maximize shareholder wealth, is in a sense by making the world a better place, by making your customers better. That's the only way to make the world a better place is by making each individual customer better. You see, but they want us to forget about the individual. They want us to pretend that there's some society out there and that this society has a well-being, has good stuff associated with it and bad stuff associated with society, not as individuals, but as a group. And that your job as a business leader is not to improve the well-being of the individuals in the group who want to interact with you, but that your job is to improve your well-being of the group, qua group. Now, of course, how do you know what's good for the group? What do you know what's good for the group? Well, I don't. And I don't think any of you do. And indeed, I don't think anybody does. I think only the pretentious, philosopher-king leaders, or leaders know, those who have an agenda, that, like, he thinks to the world, they know what's good for society. They know what environmental policies we should have. They know how much we should pay employees. They know how much employees should take. Minimum wage, for example. They know, they know how you should use your tax cut. One of the things in his letter, he says, all companies should reveal publicly how they're going to use the money they get from the tax cut, because Larry Fink knows how you should use it. You don't. Your shareholders don't. He knows. The supreme leaders know. They are channeling the well-being of society, and they will tell you what kind of behavior is acceptable to society, and what kind of behaviors are unacceptable to society. Whenever we talk about social responsibility, the public good, all we're doing is feeding in to the desire of the powerful to control our lives, because nobody knows what the public interest is. Nobody knows what's good for society. There is no such thing as society. There's no such thing as the public. All we can do is trade, interact in a positive way with individuals around us. There is no way to aggregate the good of society. There is no way to figure it out. Other than, I would say, the only good of society, the only truly socially responsible thing to do is leave people free to make decisions for themselves, to make decisions for themselves. That's socially responsible. But that's exactly what they don't want, because they want to tell us what social responsibility means. They want to tell us how to run our companies. They want to tell us how to run our lives. They want to tell us what we should be feeling and what we should be thinking. They want to determine what's good for society. And since there is no society to stand up to them, who's going to tell them no? So it's up to individuals now to speak up against what we think. To tell them to go to hell. I don't want your money if I was a CEO. Don't invest in me, please. I'm not interested in your, you know, social responsibility garbage. I'm not interested in your guidelines for how I should use the taxes, let's say the taxes that I get back that were mine to begin with, my money, getting back. I'm going to do with them, a responsible CEO would say, I'm going to do with them what is the best interest of shareholders. Now it might be in the best interest of shareholders and this goes to a whole other thing that's been going on the last few weeks. It might be in the best interest of shareholders to return the money directly to them because they have better opportunities to invest than money than we do at the corporate level. So I could buy back my stock, I could give out a dividend, but in other words, I'm returning the money to shareholders. Neither one of those activities, by the way, in and of themselves, raise the price of stocks. But what they do reflect a willingness of management to place shareholders above managers. Managers love sitting on a pile of cash. It makes their life easy. It protects them from any downside risk. Their willingness to give up that cash to give it back to shareholders show shareholders that these are managers focused on maximizing shareholder wealth and therefore the stock might go up because it's a signal that these managers are good. So it might be that APA should give all its money back to shareholders because it doesn't face good investment opportunities. It might be that that would be a mistake. It might be that it's in the best interest of shareholders that Apple invest that money because Apple is a better investor than they are and they have good investment opportunities. But I don't know the answer to that. Larry Fink doesn't know the answer to that. Trump doesn't know the answer to that. Schumer doesn't know the answer to that. Politicians, intellectuals don't know the answer to that. Apple's management might, some really engaged shareholders might, but it's none of anybody else's business. Let me say that again. It's none of anybody else's business. Apple has cash. It should do with that cash as it sees fit in its effort to try to maximize the returns to shareholders over the long run. And that could be stock buyback and it could be investing, buying other companies. Who knows? Who knows? So this mythology of stakeholders and social responsibility is very, very dangerous. And the more we engage with it, the more it becomes prominent, the more power we concentrate in those who want to dictate what society, what is good for society, what society should do. And the fact that this is gaining traction, the fact that this is gaining traction within America's boardrooms is truly scary. The fact that they are CEOs, the fact that they are leaders, the fact that they are board members who take this seriously is truly scary. They're not waiting for government to impose it on them. They're starting to do it voluntarily. Now it means that these companies will become less productive in the long run. It means that these companies will become less competitive in the long run. And if somebody wants to, you know, predict the decline of American business in favor of foreign competition, this could be a great reason. Now, some foreign competition is already, in a sense, handcuffed by these kind of things that are part of their institutionalized law companies in Germany, companies in Japan that should be much more productive, much more competitive, much better than what they are, are not as good because of these kinds of laws in those countries. Here in America, we're going to do it voluntarily to ourselves. So we need a rebel against it. Now there's a great example of how to rebel against this, which was illustrated by a CEO. Nothing recent, this was in 1996, by T.J. Rogers, the CEO then of Cypress Semiconductors. And when we come back from a break, we've got to break it about a minute, when we come back from the break, we'll talk about what T.J. Rogers did in 1996 that gave so much prominence to this discussion. And I think ultimately killed, killed the discussion and much of the legislation that people were thinking about passing because he took a moral stand and he made it very public. But it's back. And it's back from both sides of the aisle. It's back with a fury. It's back in the boardrooms of American businesses. And we're going to need businessmen to stand up for this because the only thing that will stop the ever encroaching socialism in this country, the ever encroaching statism in this country, the ever encroaching regulatory environment in this country where everything we do is controlled is when businessmen stand up. All right. You're listening to the Iran Book Show on the Blaze Radio Network. We'll be right back. This is the Iran Book Show. Hey, everybody. I hope you're having a great weekend and we're talking about, I know, it's kind of an obscure topic. It's not what you're going to hear on other talk radio shows. But I think really, really important. The attitude of our corporate leaders, the attitude of our investment leaders towards what companies should do, whether they should be self-interested and maximize shareholder wealth, benefiting themselves and all who interact with them, or whether they should be focused on some social justice program or so-called social justice, or so-called maximizing stakeholders, benefits, or social responsibility always mean nothing. And it provides power to those who try to define them over us. That is a crucial debate which will ultimately determine the fate of American business long-term and the success of American business. I'll give you a quick example. Here's a lot of stuff coming out now about cell phones not being good for you, particularly children. And maybe it's true and maybe it's not. I don't know. I haven't looked at the science. And there's a lot of, you know, pressure now. Now, whose responsibility is that? Let's say cell phones are not good for kids. Parents. But there is pressure now on Apple by shareholders to do something about it. They don't say what to do about it, to do something about it, to make it a priority. Now, if I'm a shareholder of Apple and I need that money for my pension or I need that money because I'm saving up to buy something, or I need that money for my financial security, I don't want Apple to worry about how parents and children are using iPhones. That's the parents' problem. But one of Apple's largest shareholders, CalSTRS, which is the California retirement system that manages the pensions for the state public school teachers. The second largest institutional investor in the United States after CalPERS, the other California pension plan. They teamed up with a consulting firm out of Australia, JANA partners, who consult shareholders to push Apple to start considering the detrimental effects its products have on children and to have a plan around that, to have a business strategy around that. Maybe if they went bankrupt, you know, children would be better off. That's the kind of stuff. And that's relatively benign. It gets much worse. You have to consider the impact of what you're doing on global warming. Exxon has been hounded about this. So Exxon now reports the impact Exxon has on global warming is reported by Exxon every quarter because of this kind of shareholder activism. JANA espouses that, you know, companies now think about the impact that their decisions have on public health, on human capital management, and on environmental protection. Oh my God. All right, so I want to tell you kind of an inspiring story. And the inspiring story of that, story of T.J. Rogers, the CEO of Cypher 7 conductors. In 1996, April 23rd, Cypher Semiconductor, a publicly traded company that out of Silicon Valley received a letter from the Sisters of San Francis of Philadelphia. This is a, I guess, a group of nuns that have a pension plan, and that pension plan owns some Cypher's stock. And in that letter, Sister Doris speaking for the Sisters of San Francis of Philadelphia and as a Cypher shareholder, expressed a view that the company is, quote, best represented by a board of qualified directors reflecting the equality of the sexes, racers, and ethnic groups. And that they would withhold authority to vote for nominees of a board of directors that does not include women and minorities. So this is pretty standard stuff today. And indeed, I don't know that there are any boards that don't have women minorities because of this kind of stuff. But this was 1996. As a Cypher semiconductor, I don't think at the time had a woman or had a racial minority on the board. The letter urged them to enrich the board by seeking qualified women and members of racial minorities as nominees. Now, today you would, phew, big deal, you know. But because we've still gotten used to this, this is standard practices. Every single company has quotas for women and racial minorities in terms of who they hire. Certainly on the board of directors, that's a requirement. But in this case, one of the rare cases, not only, not only, did the CEO of Cypher semiconductor, TJ Rogers, answer the nun, repudiate the nun's claims, the nun's demands, and make it public. It made such a big stir that it was published in full by the Wall Street Journal. The whole thing was published in the Wall Street Journal. And it cost everybody to comment on this. Now, I'm not going to read you the whole letter. You can find it if you put down Cypher's letter to nun in Google. You will find it. It's worth reading. It's worth reading the whole thing. And I don't agree with everything written here. And I think the emphasis could have been a little different. It could have been stronger. But wow, this is so different than anything else you hear from corporate America. What a breath of fresh air. Now, he says, he says that in this letter, I will iterate the management argument opposing your position. Then I will provide, listen to this. This is a CEO in Silicon Valley. Then I will provide the philosophical basis behind our rejection of the opening principles are spoused in your letter, which we believe to be not only unsound. Listen to this, guys. But even tomorrow, he goes on to state that the Board of Directors is not a ceremonial watchdog, but a critical management function. That they have clear criteria for choosing directors, which means an experienced CEO in an important technology company, direct expertise in the semiconductor business based on education and management experience, and direct experience in the management of a company that buys from the semiconductor industry. Those are the qualifications of their directors. And he says, the fact is that when we do a search, the search usually yields a male who is 50 years old, has a master's degree in engineering science and has moved up the managerial ladder to a top spot in one or more corporations. He goes on, unfortunately, there are currently few minorities and almost no women who chose to be engineering graduates, students 30 years ago. Then in parentheses, he says, that picture will be dramatically different in 10 years due to the greater diversification of graduate students in the 1980s. But he says, he says bluntly stated, this is great, quote, a woman's view of how to run a semiconductor company does not help us unless that woman has an advanced technical degree and experiences a CEO. He goes on, we do not. We would quickly embrace the opportunity to include any woman or minority person who could help us as a director because we pursue talent and we don't care in what package that talent comes. I mean, this is unbelievable, right? This is great stuff. As I said again, if you want to read the full letter, all you have to do is search, Google, Cyprus, Cyprus and then letter to none. And you will get it. You can get it from the Wall Street Journal webpage, I think. He adds, he goes on to say, I believe the placing arbitrary racial agenda quotas on corporate boards is fundamentally wrong. Your requirements are in effect immoral. And by immoral, I mean causing harm to people. And then he goes on to say, you're investing funds for your nun's retirement by urging us to do something that will not maximize your wealth, not maximize shareholder wealth. You are hoarding the pensions of your nuns. You are violating your own fiduciary duty as responsible for this investment. He says, any choice I would make to jeopardize retirees and other investors from achieving their lifetime goals would be fundamentally wrong. Quote, electing people to corporate boards based on racial preferences is the meaning to the very board member placed under such conditions and unfair to people who are qualified. What a stand, principled, articulate. I would have phrased some of this differently. He says, if all companies in the U.S. were forced to operate according to some arbitrary social agenda, i.e. Larry's, right, rather than for profit, all American companies would operate at a disadvantage to foreign competitors. All Americans would become less well off, some even laid off, and charitable giving would decline precipitously. I don't like that portion. He's framing this as charitable giving will go down. Charitable giving is the essence of virtue. You're hoarding virtue. This is where TJ sells off a little bit. So that's my reply, he summarizes. Choosing a board of directors based on race and gender is a lousy way to run a company. And then he goes on, he lists the whole list. In addition to your focus on racial and gender equality or board of representations, other investors have their own pet issues. For example, whether or not a company, quote, is green or environmentally conscious. Does or does not do business with certain countries or groups or people. Supplies the U.S. Armed Forces is involved in the community in appropriate ways. Pays its seal too much, too little. And he goes on and on and on with all these lists of special power, special interest groups or pressure groups. And he ends the letter. Cyber stands for personal and economic freedom. For free minds and free markets. A direct quote, by the way, from Ayn Rand. A position irrevocably in opposition to the immoral attempt by coercive utopians to mandate even more government control over America's economy. With regard to our shareholders and the size they write to vote according to social agenda, we suggest they consider whether or not their strategy will do net good after all the real costs are considered. Period. I would have added, sell your shares, go somewhere else. Thank you. Now, wow, if we're going to change the world, if we're going to make a world a more capitalist world, if we're going to make the world a freer world, if we're going to make a world that is free for individuals to pursue their happiness, business leaders, business men are going to have to do what T.J. Rogers is. They're going to have to stand up for their right to make money. They're going to have to stand up for their right to do business as they see fit. They're going to have to denounce the levy thinks of the world. They're going to have to denounce the bureaucrats. But also, the people are not bureaucrats. The business men who are anti-business. They're going to have to stop granting the sanction of the victim to use Ayn Rand's terminology. That was her last speech where she said, you businessmen are making your enslavement possible. You're making the destruction of capitalism possible. You're making the destruction of American capitalism possible. Stand up, businessmen. Write letters like T.J. Rogers did. Speak up. Speak up for your own lives and for the lives of all of us who admire you. All right, we're going to take a quick break here. You're listening to Iran Book Show on the Blaze Radio Network. The Iran Book Show. All right, we're back for the final segment here today. And as usual, the final segment on these shows that really open up the lines for your call. So, 1-88-900-3393. Any topic. I prefer on the topic of the day, it's a moment of reason. Anything you want. And we've got Dom on the line from Minnesota. Hey, Dom. Hey, Iran, good show, man, so far. Well, I'm really pleased to have you listening. Yeah, right, right. Once in a while, I'll listen to you. Yeah. Just calling in to chime in on the shakehold and the stakeholder interest. My wife and I own the small business, you know, where we employed our son for doing little chores for pay. Dad wanted to pay him, which is me, a certain amount based on a work done. However, mom wouldn't have any of it. She's like, are you serious? He's our son. We can't tame that. We need to increase it for 50%. So, I'm looking at it from that perspective. In our business, I was a greedy owner, lusting after profits, and she was the social justice warrior, so to speak. So, we learned a pretty valuable lesson from that because, you know, most businesses have the balance internally built in because the critical stakeholder in any business in my perspective is the owner because he or she is the one risking the capital, risking their lives and stuff like that to make a profit. And I think people forget profit is the only motivation that makes me want to risk my capital. The owner is not really responsible for creating jobs. It's just an incidental thing. However, the drive to make profit has really good intangible side effects like, you know, treating your customers with respect, giving them value and creating jobs for their money. But that's not the main motivation. But I would go further than that, Dom. I agree that it's usually not the main motivation to make money. Making money is part of it. But making money is a good thing in and of itself. I mean, you should be rewarded for the risk you take. You should be rewarded for the hard work you put in. You should be proud of the fact that you make a lot of money. The reason you can make money is because you're treating your customers well. If you treated them really badly, they wouldn't come back to you. The reason you're making money is your suppliers are being treated well. That's why they supply you with what they supply. But most importantly, you are taking care of yourself, your wife, your family. You're putting bread on your table. That's something to be proud of. Making money is not something business owners, small or large, should apologize for. It's not something we have to say, yeah, I made money, but look, I also created jobs. No. The fact that you made money in and of itself is good, is moral, is virtuous. Because you're taking care of your own life and what can be more important than taking care of your own life? I don't know of anything more important than that. Yeah, I'm coming right from that perspective because just listen to this example. I mean, the interaction going on between you and me. I mean, you didn't ask me to call and I called because you interested me in your discussion. You persuaded me to call. And that's a good thing. And I think that's what keeps it going. But the problem, the big problem I see there, unfortunately, is really hard idea for social justice warriors to comprehend this concept that if you own a business in the free enterprise system, you really are forced to do good in order to make a profit. There's no other way around it. So these guys, unfortunately, I don't know whether they're schooled. And that's the problem. It's a hard message to sell to these people who have the mindset saying, you got too much money, give me some of that. I don't want to work for it. No, I agree with you completely, Dom. But part of the mindset is, part of the mindset is, and thanks for calling, Dom. I've got another. Let me go to Stuart next. But part of the mindset is that if you're making money, then that's self-interested. If you're making money, you're working, and that is considered morally offensive, morally bad, morally off the table. And what's good, what's morally good in our culture, unfortunately, particularly for the social justice warriors, but really for everybody, almost everybody, is serving others, particularly if you sacrifice in the service to others. That's the virtuous and noble and good. But if you're making money serving other people, that doesn't count. But never, never, ever apologize for making money. And it's not the fact that you're helping other people that makes it good. It's the fact that you're helping yourself. It's the fact that you're making your life better. It's the fact that you're taking care of your wife and children and the people you love. That's what makes making money virtuous. And oh, by the way, you cannot make money without serving your customers, serving your suppliers, and so on. All right, we're going to take a quick call from Stuart because I do not have a lot of time left on the clock. Stuart from Hawaii, how's it going? Aloha. Aloha. What's up? So I wanted to ask you if you've heard about this. So regarding social justice warriors, the first ever university department ever in the country to indoctrinate students about progressivism wasn't the liberal arts department. It wasn't a law school. It was a place you've been recently, the first ever business school, the Wharton School. Yeah, no, absolutely. It was the Wharton School named after a businessman named after a businessman who wanted these ideas taught. He advocated for these ideas. And yes, I just spoke there. I was there last week. I gave a talk. They were standing room only. The room was packed with MBAs. And the talk was all about the morality of finance. And they were shocked by the idea that the topic that they're studying, the topic and profession that they're dedicating their lives to is actually moral. They were shocked by the idea that free markets are a good thing. These are people who are going to be business leaders. Too much. These are people who are going to be, because Wharton is a good school. They don't accept everybody. These are some of the smartest kids out there. And they're going to be our business leaders and our Wall Street leaders of the future. And they're shocked that capitalism is a good thing. The free markets are good. And that finance is a good. It really, really is sad how, how much of this progressive, progressivism is inculcated into the curriculum of all these schools. So Stuart. I went to that school. You went to that school? What Larry Tink said, did a school. Yep. And what Larry Tink said was homilies. I had to listen to every single day. Absolutely. Where they say, they say, back in the time of the robber barons, we had this notion, very antiquated, that a company should be controlled by stockholders. But now we know better. Yep. A company should be controlled by a stakeholder. Yep. Meaning everyone in society. One minute. Stockholders. Meaning, meaning the company should, you know, falter and be destroyed. Thanks to it. Thanks to the call. You're absolutely right. When I was in MBA school, same thing. I got my master's degree in business. Was taught exactly this in our business ethics class. Our strategy class. Our finance people didn't teach this. But our business ethics did. All right. As I told you earlier in the show, this is my second or last show on the blaze. Next week will be my last show. We'll try to go out with a blaze of fire. But you can continue following me on your own book. Just look up your own book anywhere online. Your own book show.com. You can follow me in Facebook and Twitter. And you can also support the show. Support what I'm trying to do. These ideas. You're not going to hear them anywhere, literally anywhere else. And you can support that by supporting me on Patreon. Your own book show. All right. Thanks everybody. And we'll be back next week at the same time. Same place. Bye.