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Learning Fake Economics in a Fake Economy // 268 · PlasticPills Critical Theory & Philosophy

• 0:08
  Speaker 1: Today, we welcome a YouTube channel to the podcast. Unlearning
• 0:13
  Speaker 1: Economics is here to discuss with us whether the economy
• 0:17
  Speaker 1: is real or fake and give stock tips. We've invited
• 0:21
  Speaker 1: him to give plenty of financial advice in the legally
• 0:24
  Speaker 1: pursuant sense.
• 0:25
  Speaker 2: Yeah, to sell my new cryptocurrency.
• 0:28
  Speaker 3: Is it the right time to invest in AI?
• 0:29
  Speaker 2: Yes. It's not a bubble.
• 0:33
  Speaker 1: Cahill Moran, author of Why We Are Getting Poorer, A
• 0:36
  Speaker 1: Realist's Guide to the Economy.
• 0:39
  Speaker 4: A realist, he says. That's bold to come to an
• 0:41
  Speaker 4: anti-realist podcast. We're already at odds, but.
• 0:43
  Speaker 2: Oh, shit. I don't even know what that means, so probably, yeah. But,
• 0:48
  Speaker 2: you know, I didn't even choose the title, the subtitle, so... Oh, nice.
• 0:53
  Speaker 1: We're hearing a lot of that. I got to say,
• 0:55
  Speaker 1: I just... While we were doing research, while I.
• 0:57
  Speaker 4: Was doing research, which is.
• 1:00
  Speaker 1: Typing unlearning economics into YouTube. The second term that came
• 1:04
  Speaker 1: up was unlearning economics debunked. So I had to look
• 1:08
  Speaker 1: at it, of course. But the most viewed video debunking you,
• 1:13
  Speaker 1: it's your face on the thumbnail. And then, this is
• 1:16
  Speaker 1: not a joke, 68,000 views.
• 1:19
  Speaker 4: It says poopy and stinky.
• 1:22
  Speaker 2: Oh, really?
• 1:22
  Speaker 1: Just wondered if you had anything to say about that.
• 1:27
  Speaker 3: Is that true?
• 1:29
  Speaker 2: That's unbelievable. I was hoping that my poopiness and stinkiness
• 1:34
  Speaker 2: wouldn't come to light. I thought I was safe. How
• 1:38
  Speaker 2: do people know?
• 1:39
  Speaker 5: Wow.
• 1:42
  Speaker 6: That's some of that online toxicity you did a video about.
• 1:47
  Speaker 2: Oh, yeah. Are you a member? Did you subscribe for that?
• 1:51
  Speaker 4: I did.
• 1:52
  Speaker 6: I spent the whole week watching you.
• 1:54
  Speaker 2: Yeah, yeah. Watching my videos. Yeah, yeah. Not just me. Right, okay, yeah. Yeah, yeah.
• 2:05
  Speaker 2: I checked it out. It was really good.
• 2:08
  Speaker 1: So Cahill is joining us from London, where all the
• 2:10
  Speaker 1: economics come from. Marx, Ricardo, Gary Stevenson.
• 2:17
  Speaker 2: It's recommending, actually, Amazon.
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  Speaker 3: Adam Smith.
• 2:21
  Speaker 4: Isn't Adam Smith from Scotland?
• 2:23
  Speaker 1: Amazon's trying to bundle my book, or your book, sorry,
• 2:26
  Speaker 1: with Gary Stevenson's book.
• 2:28
  Speaker 4: So I can add both to cart at the same time.
• 2:30
  Speaker 2: Oh, well, that's only got to be good for me
• 2:32
  Speaker 2: because I think Gary's sold about sort of 10 or
• 2:34
  Speaker 2: 20 times the amount of copies I have.
• 2:36
  Speaker 4: I saw a guy reading it at the park.
• 2:38
  Speaker 2: He's big.
• 2:38
  Speaker 6: I see him all the time. He looks cool.
• 2:44
  Speaker 2: I like his hat.
• 2:44
  Speaker 1: Okay, we need some sort of organizing principle.
• 2:49
  Speaker 4: I know I shouldn't be.
• 2:51
  Speaker 1: The one to say that but we do need some
• 2:53
  Speaker 1: sort of organizing principle so i just wanted to ask
• 2:55
  Speaker 1: um to to kick us off what your mission is
• 3:00
  Speaker 1: what is the thing about economics particularly that uh left
• 3:04
  Speaker 1: leftists who say economics is the most important thing there
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  Speaker 1: is so how does how does a leftist understanding of
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  Speaker 1: economics rank i.
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  Speaker 2: Mean one of the reasons i started my channel was
• 3:17
  Speaker 2: that i just felt like there actually wasn't that much
• 3:19
  Speaker 2: leftist economics you know that the a lot of people
• 3:22
  Speaker 2: just weren't really talking about it that much. I feel
• 3:25
  Speaker 2: like there was a massive focus on cultural issues and
• 3:28
  Speaker 2: I don't really have anything against that in itself, but
• 3:30
  Speaker 2: I just wanted to fill the gap because I felt
• 3:33
  Speaker 2: like a lot of leftists weren't taking economics seriously at
• 3:37
  Speaker 2: all as a subject, which I think was like a
• 3:39
  Speaker 2: massive mistake. And I do think that leftists generally have
• 3:44
  Speaker 2: like a sort of crude Marxist view. Maybe you could
• 3:48
  Speaker 2: call it like a vulgar Marxist view of if you wanted,
• 3:51
  Speaker 2: where it's like, they've got an idea of like class,
• 3:55
  Speaker 2: proletariat and capitalist in their mind, right? And they've got
• 3:59
  Speaker 2: an idea of like, we need a revolution to abolish capital.
• 4:04
  Speaker 2: But sometimes I feel like it's just that, it's crude.
• 4:07
  Speaker 2: It's just, let's have a revolution. There are workers and
• 4:12
  Speaker 2: there are bosses and fuck the bosses. And I'm not
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  Speaker 2: saying I entirely disagree with that right but uh i
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  Speaker 2: just think there's there's a lot more there's a lot
• 4:20
  Speaker 2: more to economics there are a lot of gaps to
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  Speaker 2: fill and if you start looking at just specific things
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  Speaker 2: a lot of what my channel does i look at
• 4:27
  Speaker 2: like specific issues around like housing for instance or like
• 4:30
  Speaker 2: um race racial discrimination and things like that right and
• 4:35
  Speaker 2: there's a lot you can um discover that goes well
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  Speaker 2: well beyond just this kind of crude uh rule of
• 4:43
  Speaker 2: thumb of you know Let's just overthrow the system.
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  Speaker 1: So if we're talking scale, if we're talking the Marx
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  Speaker 1: to Hayek scale, where are you?
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  Speaker 2: Oh, God. So the Marx to Hayek scale, ideologically, I mean,
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  Speaker 2: I'm much closer to Marx. That's definitely... Definitely true. I
• 5:07
  Speaker 2: think that I would identify myself as a socialist. Right.
• 5:12
  Speaker 2: I'm not really just as I'm I'm not a massive
• 5:16
  Speaker 2: fan of let me put it this way. I'm not
• 5:18
  Speaker 2: a massive fan of any dogmatic narrative. Right. I don't
• 5:20
  Speaker 2: like orthodoxy. And when I talk about like unlearning economics,
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  Speaker 2: my channel name. I'm really against any type of orthodoxy. Now,
• 5:29
  Speaker 2: that happens to be a more free market, more right-leaning
• 5:34
  Speaker 2: type of mainstream economics where we are. If I were
• 5:38
  Speaker 2: in a different context in the Soviet Union or in China,
• 5:40
  Speaker 2: I might be against a more Marxist orthodoxy. Maybe this
• 5:46
  Speaker 2: is a really annoying answer to your question, but I
• 5:47
  Speaker 2: would really want to draw from both Hayek and Marx.
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  Speaker 2: I just think they're both really valuable thinkers. politically closer
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  Speaker 2: to Marx, but economically, I draw just as much from Hayek.
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  Speaker 1: So you're not beating the allegations that it's very hard
• 6:02
  Speaker 1: for Brits to take a position on?
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  Speaker 2: Honestly, the British pragmatism is a disease, actually. I realize this.
• 6:13
  Speaker 2: I realize this, yeah. Yeah, I think.
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  Speaker 6: I mean, we come at the issues we look at
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  Speaker 6: from the left as well, but I guess... Pills and
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  Speaker 6: I sort of had a similar education, like a left-leaning.
• 6:30
  Speaker 6: And then Victor, yeah, political science. Maybe that's mixed political theory.
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  Speaker 6: But you started your channel because I've watched you. I'm
• 6:40
  Speaker 6: going to tell you what you've told me that you think.
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  Speaker 6: You started your channel because of a dissatisfaction with sort
• 6:47
  Speaker 6: of what you learned about economics in school, I guess, because...
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  Speaker 6: From what I understand, I mean, the two really, really
• 6:58
  Speaker 6: broad approaches are like heterodox and orthodox. And like the
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  Speaker 6: heterodox be like starting with like Marx, Keynes, and Veblen,
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  Speaker 6: and then like orthodox starting more off with like the neoclassical,
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  Speaker 6: the marginalist revolution side of things. So I don't know what,
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  Speaker 6: but it sounded like from what you said, education and
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  Speaker 6: economics is all like orthodox and neoclassical.
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  Speaker 2: Yeah totally i think one it was quite strange to
• 7:33
  Speaker 2: um go through the financial crisis which happened when it
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  Speaker 2: started when i was 16 and i was just studying
• 7:39
  Speaker 2: economics to go through that and then you know go
• 7:42
  Speaker 2: on to do a degree in economics and then and
• 7:44
  Speaker 2: then you know grad school and more and and it
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  Speaker 2: just wasn't really mentioned that was a really, really odd
• 7:52
  Speaker 2: thing to happen. And what you end up with is
• 7:54
  Speaker 2: this quite abstract, theoretical type of teaching, basically learning these
• 8:00
  Speaker 2: models by rote, learning to solve the maths, learning the assumptions, right?
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  Speaker 2: So you can restate them. You didn't really critically engage
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  Speaker 2: with these models. There were often few applications. There wasn't
• 8:12
  Speaker 2: really any testing of them, any data. There were no
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  Speaker 2: alternative models. You didn't engage in methodological or philosophical reflections
• 8:19
  Speaker 2: on them and what they meant. It was really just
• 8:21
  Speaker 2: solve this model, solve this model, solve this model through,
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  Speaker 2: you know, however many modules you do for a degree, like,
• 8:26
  Speaker 2: like 15 times, you know, that was all of, all
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  Speaker 2: the exams were just solve this model, solve this model. Um,
• 8:34
  Speaker 2: and that was, that was all neoclassical economics, right? So
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  Speaker 2: I really felt like neoclassical economics was and is drilled
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  Speaker 2: into students. It's just like, well, this is economics. This
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  Speaker 2: is what you have to learn, you know? I don't
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  Speaker 2: know how familiar everyone here or your listeners are with
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  Speaker 2: what neoclassical economics looks like, but there's a lot of
• 8:53
  Speaker 2: like optimization mathematics, like what's called dynamic control theory, where
• 8:58
  Speaker 2: you're sort of like, you know, solve this problem, this
• 9:00
  Speaker 2: firm is trying to maximize profits, you know, it has
• 9:04
  Speaker 2: these kinds of parameters, this production technology, it's operating in
• 9:07
  Speaker 2: the market, trying to sell, you know, what's the price
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  Speaker 2: it should sell at to optimize profits, that kind of stuff, right?
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  Speaker 2: So that's just what you're doing. And there's no real
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  Speaker 2: question about whether this is what you should be learning
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  Speaker 2: or whether this applies, which is really, really disappointing and
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  Speaker 2: quite jarring. And it is something that takes a while
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  Speaker 2: to unlearn. That was why I chose to call my
• 9:31
  Speaker 2: channel that, because it just gets... drilled into your head.
• 9:35
  Speaker 2: And if you speak to a lot of students, even
• 9:37
  Speaker 2: ones that are genuinely kind of intellectually curious and they're like, oh, well,
• 9:41
  Speaker 2: you know, I don't think that what I've learned is
• 9:42
  Speaker 2: the best thing ever. Maybe there are other approaches. They
• 9:44
  Speaker 2: find it very difficult to think outside of these frames
• 9:47
  Speaker 2: just by virtue of pure repetition. So, yeah, my channel
• 9:54
  Speaker 2: tries to provide a more critical perspective. And I have
• 9:56
  Speaker 2: had people say to me, which is really nice. I've
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  Speaker 2: had people say, look, your channel is actually a really
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  Speaker 2: good accompaniment to an economics degree, which I think is
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  Speaker 2: maybe we can talk a bit about anti-intellectualism and stuff
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  Speaker 2: at some point. But It's quite nice to hear that
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  Speaker 2: because I'm not trying to make people not study economics.
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  Speaker 2: I don't want people not to be interested in the subject.
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  Speaker 2: That's not at all what I'm going for. Say, you know,
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  Speaker 2: if you do an economics degree and watch Unlearning Economics
• 10:21
  Speaker 2: on the side, then that's like an ideal situation for me. Like,
• 10:24
  Speaker 2: that's the perspective I'm trying to provide.
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  Speaker 3: That's interesting. That's really interesting. I think you.
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  Speaker 5: Do you identify as a positivist or do you give
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  Speaker 5: a critique of positivism?
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  Speaker 2: I don't... So.
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  Speaker 3: And maybe you could explain what that.
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  Speaker 5: Is in economics, because I think in philosophy, you know,
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  Speaker 5: maybe like a lot of our audience, they're going to
• 10:45
  Speaker 5: identify as kind of like continental, kind of like critical
• 10:48
  Speaker 5: theory people. And there they're going to think about positivism
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  Speaker 5: as like the Vienna circle, these philosophers. So I think
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  Speaker 5: in economics, it probably means something quite different.
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  Speaker 3: I'm guessing.
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  Speaker 2: Let me give you my long and possibly rambling answer
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  Speaker 2: to this, because I've thought about it a lot, but
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  Speaker 2: I don't actually have any proper philosophical training. So some
• 11:05
  Speaker 2: of these currents of four and thinkers that you might
• 11:08
  Speaker 2: know quite well, I feel like I don't really. So
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  Speaker 2: maybe you can set me straight on some of this.
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  Speaker 2: I'm really happy to be corrected. I have what I
• 11:16
  Speaker 2: consider an at once extremely positivist and extremely anti-positivist view
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  Speaker 2: in economics. Now, let me explain this. What you see,
• 11:25
  Speaker 2: and this runs through mainstream economics education, and especially mainstream
• 11:30
  Speaker 2: economics research, which does use a lot of data and statistics.
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  Speaker 2: I think there is a fundamental conceit that economics is
• 11:37
  Speaker 2: something approaching a science. And I think Marxists can be
• 11:40
  Speaker 2: guilty of this as well. And that we can predict
• 11:43
  Speaker 2: the behavior of the economy using mathematical models, using statistics, right? Okay,
• 11:49
  Speaker 2: so that is the fundamental conceit. And you see this
• 11:52
  Speaker 2: a lot. And sometimes people even say to me, they're like, well,
• 11:55
  Speaker 2: you know, why would you want to unlearn economics? Economists,
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  Speaker 2: all they do is, you know, they produce hypotheses and
• 12:00
  Speaker 2: they test them and blah, blah, blah. Now, my response
• 12:04
  Speaker 2: to that is basically to reduce it to, or not
• 12:07
  Speaker 2: to reduce it to an absurdity, but to take it
• 12:09
  Speaker 2: to what I consider its logical endpoints. and actually subject
• 12:13
  Speaker 2: some of these theories to some quite ruthless tests in
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  Speaker 2: the way that a scientist would, right? Hopefully. Now, I
• 12:19
  Speaker 2: wrote a series, I don't know if any of you
• 12:21
  Speaker 2: have encountered it, called The Pluralist Showcase, where I ran
• 12:25
  Speaker 2: through about 20 different theories, both mainstream and heterodox, which
• 12:28
  Speaker 2: I thought were better candidates for successful positivism, right? For
• 12:33
  Speaker 2: predicting actual data than most. There are a lot of
• 12:37
  Speaker 2: theories in economics that don't really do this. There are
• 12:39
  Speaker 2: a few where you're like, OK, that's actually quite impressive.
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  Speaker 2: You've actually seemed to have fitted it to quite a
• 12:44
  Speaker 2: lot of sort of observed behavior. They do tend to
• 12:47
  Speaker 2: be quite localized. It tends to be like something quite
• 12:49
  Speaker 2: narrow and specific in a certain place at a certain time.
• 12:52
  Speaker 2: I think that's all we can really hope for. But basically,
• 12:56
  Speaker 2: when you subject economic theories to the proper scrutiny, very,
• 12:59
  Speaker 2: very few survive. Very few survive. And one of the
• 13:02
  Speaker 2: things I have done in my videos, and some people
• 13:04
  Speaker 2: don't get the sort of meta point I'm trying to
• 13:06
  Speaker 2: make here, is expose them to this kind of ruthless
• 13:10
  Speaker 2: scrutiny and then say, look, they don't fit it. Now,
• 13:13
  Speaker 2: is that because economic theories can or should fit the
• 13:16
  Speaker 2: positivist mode? I don't think so. Sometimes, like I said,
• 13:19
  Speaker 2: specific times, specific places, narrow behaviors can work, possibly. But
• 13:24
  Speaker 2: generally speaking, I don't think we're going to find a
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  Speaker 2: theory of the economy. I think that's utterly, utterly ridiculous.
• 13:29
  Speaker 2: That's why I'm a pluralist. And so I'm trying to
• 13:31
  Speaker 2: sort of hoist people by their own petard when they
• 13:33
  Speaker 2: do think that you can be positivist in social science. Now,
• 13:38
  Speaker 2: if you ask me to elaborate on like the.
• 13:40
  Speaker 1: Okay, before we do that, my brain is actually just
• 13:45
  Speaker 1: screaming at me because every single time I hear the
• 13:49
  Speaker 1: word positivism, I think logical positivism, which is.
• 13:55
  Speaker 1: A thoroughly debunked view of 20th century philosophy, but what
• 13:58
  Speaker 1: is economic positive?
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  Speaker 4: Is it just prediction? Like if you.
• 14:02
  Speaker 2: Oh, I was just thinking. Okay. Sorry. Sorry. Yeah. Yeah. No,
• 14:05
  Speaker 2: so good.
• 14:06
  Speaker 1: I'm glad.
• 14:06
  Speaker 2: So I'm glad you're pulling me up on this because
• 14:08
  Speaker 2: it is a term that I use.
• 14:12
  Speaker 1: Yeah.
• 14:12
  Speaker 2: Not in the sense that you're using it clearly like that,
• 14:15
  Speaker 2: you know, that this is something that you'll have to
• 14:17
  Speaker 2: tell me about. I was just using it as a
• 14:20
  Speaker 2: kind of like a, So in economics, we have normative
• 14:26
  Speaker 2: and positive economics, right? Milton Friedman made this distinction. And
• 14:31
  Speaker 2: so I actually, yeah, this is one of those things.
• 14:34
  Speaker 2: We're using the same word in maybe two very different
• 14:36
  Speaker 2: ways because positive is just like describing or predicting the
• 14:40
  Speaker 2: world and not necessarily making a judgment about it. That
• 14:44
  Speaker 2: was Milton Friedman's central point in essays in positive economics, right?
• 14:48
  Speaker 2: So when I use positivism, that's what I mean. And
• 14:51
  Speaker 2: he separated that from normative judgments about what the world
• 14:53
  Speaker 2: should be, right? So yeah, that's exactly what I'm talking about.
• 14:58
  Speaker 2: So it is just kind of science. You could call
• 15:01
  Speaker 2: it scientism, maybe, or something like that.
• 15:03
  Speaker 3: But that makes sense.
• 15:05
  Speaker 5: That actually parallels somewhat with logical positivism. Like when you
• 15:08
  Speaker 5: were giving your first account, I was like, okay, I
• 15:10
  Speaker 5: do see some similarity because in the sense that the
• 15:13
  Speaker 5: positivist economists think that they can make a model of
• 15:19
  Speaker 5: the world, like a descriptive model of the world that
• 15:21
  Speaker 5: can make sense of it all, right?
• 15:23
  Speaker 3: That's kind of the idea like you can use.
• 15:25
  Speaker 5: And I think the logical positivists, philosophers also are like,
• 15:29
  Speaker 5: we can make a descriptive model of reality with these assumptions,
• 15:34
  Speaker 5: these kind of like simple units of description. So I
• 15:38
  Speaker 5: think like there is some parallel in the sense that both,
• 15:42
  Speaker 5: because it seems like your criticism of economists who think
• 15:46
  Speaker 5: they can create a model of social and economic life
• 15:50
  Speaker 5: is that, well, you're actually making a.
• 15:51
  Speaker 3: Whole bunch of assumptions, right?
• 15:52
  Speaker 5: That don't actually end up when you, when you, when you,
• 15:54
  Speaker 5: when you, when you, when you try to scrutinize them,
• 15:57
  Speaker 5: they end up kind of falling apart and you, they,
• 15:59
  Speaker 5: you realize that they have a bunch of assumptions like
• 16:01
  Speaker 5: Milton Friedman probably had, has a whole bunch of assumptions, right? Um,
• 16:05
  Speaker 5: so it's, it's, and I think that's the same thing
• 16:07
  Speaker 5: that positivist philosophers are doing.
• 16:10
  Speaker 3: They're trying to build a model of.
• 16:13
  Speaker 5: The world, uh, But they're actually, but it, but pills
• 16:16
  Speaker 5: just said it was debunked because I think many people
• 16:18
  Speaker 5: think it's, well, it's based on a bunch of faulty assumptions.
• 16:21
  Speaker 4: Sorry.
• 16:22
  Speaker 1: That was, that was tongue in cheek. It hasn't, it
• 16:24
  Speaker 1: hasn't been debunked, but it hasn't.
• 16:26
  Speaker 3: I mean, nothing in philosophy can really be debunked.
• 16:29
  Speaker 2: Exactly.
• 16:30
  Speaker 6: But I think, I think it, it all goes back
• 16:32
  Speaker 6: to what Cahill said about economics, trying to be more scientific,
• 16:37
  Speaker 6: trying to feel more scientific. And it's sort of institutional
• 16:41
  Speaker 6: level pitch that, of itself, because a lot of the
• 16:44
  Speaker 6: human sciences do this, right? If you go into psychology,
• 16:48
  Speaker 6: it's going to lean heavily on data and statistics and
• 16:52
  Speaker 6: empirical testing. And I think logical positivism came from the
• 16:56
  Speaker 6: same thing. Like, oh, we have all these problems about
• 16:59
  Speaker 6: like meaning and verifying the truth of statements. So you
• 17:03
  Speaker 6: just go out and make observations in the world. You
• 17:06
  Speaker 6: determine what things are referring to and you use mathematics
• 17:10
  Speaker 6: and statistics to confirm it. And then when you're going
• 17:15
  Speaker 6: to your university head, you can really make a great
• 17:18
  Speaker 6: pitch and say, this is super scientific. If you invest
• 17:21
  Speaker 6: in this, you're going to make tons of money and
• 17:23
  Speaker 6: we're going to be a great university. I think that's
• 17:25
  Speaker 6: maybe what it goes back to in even logic.
• 17:29
  Speaker 2: Economics as a subject, one thing that tells you that
• 17:33
  Speaker 2: economics as a subject isn't really that good at making
• 17:37
  Speaker 2: predictions and isn't really maybe that positivist is that it's
• 17:42
  Speaker 2: so responsive to what happens in the world. It's always
• 17:48
  Speaker 2: fighting the last war, right? So you see like the
• 17:51
  Speaker 2: 2008 financial crisis, then economists are like, oh, we need
• 17:55
  Speaker 2: to pay attention to the financial sector. You see the
• 17:58
  Speaker 2: election of Trump the first time and Brexit as well, right?
• 18:02
  Speaker 2: And then economists are like, oh, right, maybe we should
• 18:04
  Speaker 2: pay more attention to the negative effects of globalization, the pandemic. Oh,
• 18:09
  Speaker 2: maybe we should pay more attention to health and epidemiology,
• 18:14
  Speaker 2: the 2022 supply chain crisis. Oh, maybe we should pay
• 18:17
  Speaker 2: more attention to supply chains. There are so many different
• 18:21
  Speaker 2: things that can happen throughout in the economy. Many of
• 18:26
  Speaker 2: them are extremely historically contingent. I mean, if you take COVID,
• 18:30
  Speaker 2: for instance, maybe there was a world where COVID just
• 18:32
  Speaker 2: didn't happen. It was kind of unlucky. It emerged from
• 18:36
  Speaker 2: a certain time and place. And then economics looks completely different.
• 18:40
  Speaker 2: So I do think that economists are really bad, and
• 18:44
  Speaker 2: maybe inevitably so. Maybe this isn't a criticism of the economists,
• 18:49
  Speaker 2: specifically the ones that exist now, but I think they
• 18:53
  Speaker 2: kind of have to be really bad at predicting these
• 18:56
  Speaker 2: kind of what are called, I don't know, structural breaks
• 18:59
  Speaker 2: in the economy, like these big shifts, these big changes
• 19:02
  Speaker 2: in how it operates. The sort of post-Cold War... conceit
• 19:09
  Speaker 2: that there was this apolitical globalization and trade and you
• 19:14
  Speaker 2: could separate the economy from the political sphere, that is
• 19:19
  Speaker 2: just well and truly dead. I think you always need
• 19:23
  Speaker 2: to be thinking about the politics of trade and like,
• 19:26
  Speaker 2: you know, who is the hegemon, your relationships with your neighbors,
• 19:30
  Speaker 2: and all of this sounds pretty obvious right now, but
• 19:32
  Speaker 2: actually pre-Trump one and even pre-Trump two, I don't think
• 19:37
  Speaker 2: it was as obvious to especially a lot of economists
• 19:39
  Speaker 2: that the politics matters that much. The hate was palpable
• 19:44
  Speaker 2: when I was in Canada, actually. I made the mistake
• 19:47
  Speaker 2: of telling Canadians that... there were some similarities to America. Oh.
• 19:54
  Speaker 3: I mean, there are.
• 19:55
  Speaker 2: How dare you?
• 19:56
  Speaker 6: I mean, there are.
• 19:58
  Speaker 2: Yeah. Yeah. I was like, I was like, no, no,
• 20:00
  Speaker 2: I just mean the geography. I just mean the geography.
• 20:02
  Speaker 2: Cause it's like close, you know, nothing, nothing, nothing cultural.
• 20:05
  Speaker 2: We have lakes.
• 20:07
  Speaker 4: We have big lakes. You guys have lakes.
• 20:08
  Speaker 2: Yeah. Yeah. Same time zone.
• 20:10
  Speaker 1: Exactly.
• 20:10
  Speaker 2: That's it.
• 20:11
  Speaker 1: Yeah.
• 20:11
  Speaker 4: We even have two different lakes. That's the same lake.
• 20:14
  Speaker 1: No, you can't, you can't say, you can't say anything
• 20:17
  Speaker 1: over here right now.
• 20:18
  Speaker 4: Like the, the Ankhs. Well, even the dads.
• 20:21
  Speaker 1: The dads and the unks, they fucking love Mark Carney
• 20:25
  Speaker 1: just because he says, I'm anti-Trump. Meanwhile, he's privatizing everything,
• 20:30
  Speaker 1: privatizing airports, cutting tax, cutting regulations.
• 20:36
  Speaker 4: And everyone goes, no, you can't say a bad word
• 20:39
  Speaker 4: over here.
• 20:39
  Speaker 5: Well, actually, that does bring me to a question. We
• 20:44
  Speaker 5: were talking about it right before you got here. I
• 20:46
  Speaker 5: think leftists instinctively want to say privatization bad, right? Like generally,
• 20:52
  Speaker 5: but I guess, you know, maybe that's not always the case.
• 20:55
  Speaker 5: It depends on where we're doing it. And, and I
• 20:57
  Speaker 5: don't know, do you have a view on like privatization
• 21:00
  Speaker 5: being a heterodox? I'm sure your answers are probably like,
• 21:03
  Speaker 5: it depends, right? I mean, that's kind of the, the,
• 21:05
  Speaker 5: the obvious sort of answer. Um, but, but maybe, maybe
• 21:08
  Speaker 5: this also leads me to a kind of broader question,
• 21:12
  Speaker 5: kind of about like the interaction between leftist politics and
• 21:16
  Speaker 5: and economics. And, you know, I was in a political
• 21:19
  Speaker 5: science department where I did my PhD. And, you know,
• 21:22
  Speaker 5: a lot of political scientists, I think, kind of use
• 21:24
  Speaker 5: economist methods. I was a theorist, but I, you know,
• 21:27
  Speaker 5: I'm not, I didn't really use. But I guess one
• 21:30
  Speaker 5: of the things that I appreciate about the economic method
• 21:34
  Speaker 5: is maybe the tools it has to measure like policy
• 21:38
  Speaker 5: outcomes or to measure things, right? I think this is
• 21:40
  Speaker 5: something that maybe leftists don't pay attention to, like, I
• 21:43
  Speaker 5: don't know, I'll give you kind of an example. Well,
• 21:45
  Speaker 5: privatization is one example. But maybe another one is, you know,
• 21:49
  Speaker 5: let's say someone wants to, you know, get rid of
• 21:52
  Speaker 5: some kind of or alter some kind of a welfare program,
• 21:56
  Speaker 5: let's just say, I mean, the leftist is gonna be like, oh,
• 21:57
  Speaker 5: you're gonna take away something, but then an economist might
• 22:00
  Speaker 5: be like, but look at the outcome it's getting, right?
• 22:02
  Speaker 5: It's not actually doing that much. It's like, they might
• 22:04
  Speaker 5: give you a persuasive kind of argument for why. Well,
• 22:08
  Speaker 5: maybe if we do this other thing, it'll be better.
• 22:10
  Speaker 5: And I think that's one of the things that I
• 22:12
  Speaker 5: feel some kind of sympathy is like being attuned to
• 22:16
  Speaker 5: at least what the data shows or at least trying to,
• 22:18
  Speaker 5: the attempt to do that about like policy outcomes, about
• 22:21
  Speaker 5: like what is, like obviously you have to decide what
• 22:24
  Speaker 5: outcome do you want first, right? And that's kind of
• 22:26
  Speaker 5: more of a normative question. It's like, what are we
• 22:27
  Speaker 5: trying to achieve here? But I guess, I don't know,
• 22:31
  Speaker 5: do you have like, in addition to privatization, do you
• 22:34
  Speaker 5: have any examples of things that, you know, a leftist
• 22:38
  Speaker 5: might be instinctively, ooh, that's bad, right? But you, with
• 22:41
  Speaker 5: your economics knowledge, you're like, no, that's actually a good idea.
• 22:43
  Speaker 5: We should we should do that. We should do that
• 22:45
  Speaker 5: thing that like a leftist will instinctively say, like, not like.
• 22:49
  Speaker 2: Yeah, I've got I've got a few, I think. I mean, yes,
• 22:53
  Speaker 2: I agree with your general point. It's kind of confusing
• 22:56
  Speaker 2: to me that anybody would be like, for example, pro deregulation.
• 23:01
  Speaker 2: or pro-regulation in general. That position makes absolutely no sense
• 23:06
  Speaker 2: to me. I can't understand why. People who are pro
• 23:11
  Speaker 2: in either of those camps, here's a test. Try looking
• 23:15
  Speaker 2: at some regulations and tell me if you honestly know
• 23:20
  Speaker 2: whether you should be pro or anti them, because so
• 23:22
  Speaker 2: many of them are so in the weeds of like
• 23:23
  Speaker 2: tractor tire sizes and stuff like that. Like I've looked
• 23:26
  Speaker 2: through regulations and I'm just like, I can't have an
• 23:28
  Speaker 2: opinion on this. I don't know what the fuck I'm
• 23:30
  Speaker 2: talking about. So like, you know, it's, it's, uh, yeah,
• 23:32
  Speaker 2: that's the pragmatic, the British pragmatism comes back in now. Yeah.
• 23:37
  Speaker 2: With specifics. So is, is privatization, um, can it, can
• 23:42
  Speaker 2: it be good? I mean, I would say to, to
• 23:45
  Speaker 2: frame the question slightly differently, I would say, do I
• 23:47
  Speaker 2: want every single industry nationalized? And the answer is no,
• 23:51
  Speaker 2: I don't want every single industry nationalized. I think the
• 23:55
  Speaker 2: public sector does things right now, like provides education and
• 24:02
  Speaker 2: health in some respect, some transportation. I think those are
• 24:06
  Speaker 2: the kinds of things that it's good at, like essential services.
• 24:10
  Speaker 2: I actually think the mapping of what the public sector
• 24:14
  Speaker 2: should do to what it does do at the moment
• 24:16
  Speaker 2: is qualitatively Not too bad. Not too bad. You can
• 24:20
  Speaker 2: debate the specifics. So I wouldn't want a whole bunch
• 24:23
  Speaker 2: of industries to be nationalized, certainly not permanently. And I
• 24:29
  Speaker 2: don't know about Mark Carney's. The first I heard about
• 24:32
  Speaker 2: his plan to privatize the airports. I can't say it's
• 24:37
  Speaker 2: something that I would expend much political time. capital on
• 24:40
  Speaker 2: I would be like airports don't really care that much
• 24:43
  Speaker 2: but I also do think one thing I will say
• 24:46
  Speaker 2: it sounds like he might be doing the model where
• 24:49
  Speaker 2: it's like sort of half nationalized half privatized which is
• 24:52
  Speaker 2: what we have for the trains in the UK, which
• 24:54
  Speaker 2: is like the worst model ever. So I don't know.
• 24:57
  Speaker 2: It's sort of like the ruthlessness and profit-driven nature of
• 25:00
  Speaker 2: market forces without market discipline. So you know what I mean?
• 25:04
  Speaker 2: It's like... Worst of both worlds. Yeah, the worst of
• 25:07
  Speaker 2: both worlds. It's like horrible and boring. So yeah, anyway. So,
• 25:12
  Speaker 2: but with some other, there are some other policies that
• 25:15
  Speaker 2: I might have a clearer position on. So I think
• 25:17
  Speaker 2: I would consider myself like a Yimby, right? Like I
• 25:19
  Speaker 2: think a lot of zoning laws, particularly in North America.
• 25:22
  Speaker 2: I mean, North American suburbs are crazy and how restrictive
• 25:25
  Speaker 2: they are. The fact that you have to drive to
• 25:27
  Speaker 2: go to a shop, like no, allow commerce, you know,
• 25:31
  Speaker 2: near houses, allow different types of units or like, you know,
• 25:35
  Speaker 2: single family housing, you It's all very car-centric. You've got, like,
• 25:39
  Speaker 2: parking requirements and stuff, like very restrictive regulations. And, you know,
• 25:44
  Speaker 2: I don't think that should necessarily be coded as right-wing
• 25:47
  Speaker 2: deregulating that, especially given its association with white flight and everything, right,
• 25:53
  Speaker 2: in the 20th century. But, yeah, that's a deregulation. There's
• 25:57
  Speaker 2: another one. Have you guys ever seen a classic feel-good
• 26:01
  Speaker 2: British film, The Bank of Dave? No. You probably won't
• 26:06
  Speaker 2: have because it's more of a British thing. But basically,
• 26:09
  Speaker 2: this guy, this business owner from Bolton in the north, Dave,
• 26:14
  Speaker 2: and it's a true story, sorry. He basically starts lending
• 26:18
  Speaker 2: out money to locals to help the community, to provide
• 26:21
  Speaker 2: credit and help people who are having difficulties or need
• 26:26
  Speaker 2: to start a business of their own or whatever. And eventually,
• 26:29
  Speaker 2: it builds up and builds up and more and more
• 26:30
  Speaker 2: people come to him. And he's like, oh, I'll become
• 26:32
  Speaker 2: a banker. Then he goes to the Bank of England, right,
• 26:38
  Speaker 2: to try and like, you know, adhere to the different regulations.
• 26:42
  Speaker 2: He needs like quite a lot of capital. I think
• 26:44
  Speaker 2: you need like 10 million pounds or something. And the
• 26:47
  Speaker 2: end result, I think in the film, they went with
• 26:51
  Speaker 2: a happy ending. But in reality, he actually couldn't. And
• 26:54
  Speaker 2: there's so many regulations. And what they do is they
• 26:57
  Speaker 2: kind of enshrine this banking cartel because it's so difficult
• 27:01
  Speaker 2: to get registered as a bank. And we haven't had
• 27:03
  Speaker 2: a new bank in the UK, I think, in like
• 27:05
  Speaker 2: a century, like a registered bank, which has an account
• 27:09
  Speaker 2: at the central bank, which is, I think, like one
• 27:10
  Speaker 2: of the main conditions for being a real bank. Right.
• 27:13
  Speaker 2: We have like building societies and smaller, you know, whatever
• 27:17
  Speaker 2: financial services, but a bank, you know, HSBC, Barclays, those
• 27:21
  Speaker 2: kinds of ones. That is just a fucking cartel and
• 27:24
  Speaker 2: it's protected by regulation, right? Or an oligopoly at the
• 27:28
  Speaker 2: very least. So I would say, yeah, let there be
• 27:31
  Speaker 2: more banks, like deregulate finance. Now, if you say deregulate
• 27:34
  Speaker 2: finance to a leftist, right, they're not going to be
• 27:38
  Speaker 2: very happy about it. I mean, I've got a Lehman
• 27:40
  Speaker 2: Brothers t-shirt on. I don't know if you can see, right?
• 27:43
  Speaker 2: There are lots of ways we should regulate finance more.
• 27:45
  Speaker 2: But in terms of that... That just protects incumbents. And
• 27:48
  Speaker 2: I think that is one line I hear from libertarians
• 27:51
  Speaker 2: where I'm like, oh, no, that's I kind of see
• 27:53
  Speaker 2: where you're coming from. Regulations can protect incumbents. You can
• 27:56
  Speaker 2: get these huge sort of corporations and they're the only
• 28:00
  Speaker 2: ones that can afford to abide by the regulations. And,
• 28:03
  Speaker 2: you know, I think Zohra Mamdani deregulated some small businesses
• 28:08
  Speaker 2: in New York. I think he created a tier system
• 28:10
  Speaker 2: where they have to abide by fewer regulations than large
• 28:13
  Speaker 2: businesses and I was like yes he's like I was
• 28:16
  Speaker 2: like yes he's spotted it right it's not just like
• 28:18
  Speaker 2: a right-wing cause to deregulate yeah um so you know
• 28:22
  Speaker 2: there's a few things like that I could go on
• 28:23
  Speaker 2: but I feel like I've spoken what do you.
• 28:25
  Speaker 5: Think about uh actually speaking of Zoran Mondami what do
• 28:27
  Speaker 5: you think about the idea of the of the grocery
• 28:29
  Speaker 5: stores the nationalized grocery stores because it strikes me that
• 28:32
  Speaker 5: like I don't know like I remember reading an article
• 28:36
  Speaker 5: about it briefly and it's like super expensive upfront cost.
• 28:40
  Speaker 5: The supply chain is complicated. Like it almost seems like
• 28:42
  Speaker 5: it's not worth doing.
• 28:43
  Speaker 2: Yeah. It's, it's one of those where I can understand
• 28:46
  Speaker 2: where he's coming from because I mean, he was elected
• 28:48
  Speaker 2: when the cost of living crisis was, or he was
• 28:51
  Speaker 2: campaigning at least when the cost of living crisis was
• 28:53
  Speaker 2: at its peak. And I think people were like groceries, groceries,
• 28:56
  Speaker 2: you know, and he was like, it was one of
• 28:58
  Speaker 2: those things where it's like, you know, something must be done.
• 29:00
  Speaker 2: This is something, therefore it must be done. Right. So
• 29:03
  Speaker 2: it's like, I think that I can understand where it's
• 29:06
  Speaker 2: coming from. If, It'd be a great example, right? If
• 29:09
  Speaker 2: the details, so it turns out, oh God, it's really expensive.
• 29:13
  Speaker 2: it's not going to reduce prices that much. I think, yeah,
• 29:16
  Speaker 2: your energy is better spent elsewhere. I wouldn't say nationalize.
• 29:19
  Speaker 2: Grocery stores don't strike me. I don't think they have
• 29:21
  Speaker 2: very high margins. No. So this is the thing. You
• 29:25
  Speaker 2: nationalize something. OK, you nationalize something. Even if it's only temporary,
• 29:29
  Speaker 2: you nationalize it if they're taking the fucking piss, right?
• 29:33
  Speaker 2: This is the really simple rule that I have. Banks, 2008,
• 29:37
  Speaker 2: nationalize them. Wipe out all the shareholders, the executives. Get
• 29:40
  Speaker 2: rid of them. See you later. Maybe you reprivatize them
• 29:43
  Speaker 2: at a later date, but it's ridiculous. They can't behave
• 29:45
  Speaker 2: like that and expect to get away with it and
• 29:48
  Speaker 2: get bailouts and everything. And I think the water companies
• 29:51
  Speaker 2: in the UK at the moment, I mean, the situation
• 29:53
  Speaker 2: is really bad. We've had drought across the UK. Climate
• 29:56
  Speaker 2: change is hitting us harder than we thought and they've
• 30:00
  Speaker 2: since they were privatized in 1992 they have built zero
• 30:03
  Speaker 2: new reservoirs while taking some nice dividends for their for
• 30:07
  Speaker 2: their shareholders right terrible like it's ridiculous water is the
• 30:10
  Speaker 2: basis of life as we know it nationalize them you
• 30:13
  Speaker 2: know get rid of the people in charge you can't
• 30:15
  Speaker 2: just you can't be doing that right so that's the
• 30:17
  Speaker 2: thing but then when you get these like yeah retail
• 30:20
  Speaker 2: like grocery shops quite fine margins i don't think Grocery
• 30:25
  Speaker 2: store owners are making off like bandits, really, are they?
• 30:28
  Speaker 2: So it doesn't seem like a ripe target.
• 30:30
  Speaker 6: Well, in Canada, I guess we... Again, yeah, this just
• 30:34
  Speaker 6: comes back to the specificity and you got to look
• 30:38
  Speaker 6: into the empirical situation. I was in the UK recently
• 30:42
  Speaker 6: and you have grocery stores like Lidl and Aldi and...
• 30:47
  Speaker 6: like they're German owns, they're like all from ownership all
• 30:50
  Speaker 6: over the place. In Canada, we have like four grocery
• 30:53
  Speaker 6: store chains and they're all owned by like billionaire Canadian families.
• 30:57
  Speaker 6: So we do kind of have like an oligarch and
• 30:59
  Speaker 6: it's really hard. Like if you're a foreign investor, you
• 31:02
  Speaker 6: want to start a grocery store chain in Canada, really,
• 31:05
  Speaker 6: really prohibitively difficult to do that. It doesn't happen. So
• 31:09
  Speaker 6: we have a very different landscape in the grocery. We
• 31:14
  Speaker 6: do have grocery bandits everywhere. And they donate to both parties.
• 31:18
  Speaker 6: What is it like our Loblaws family? They donate to
• 31:20
  Speaker 6: both of the political parties. Maximum, they're allowed to donate.
• 31:24
  Speaker 6: And whoever wins, it's like, well, we donated to you.
• 31:26
  Speaker 6: Like they play that game. But yeah, so I mean,
• 31:29
  Speaker 6: I guess that's what's so hard about we do critical
• 31:33
  Speaker 6: theory and philosophy and those empirical tests. For certain things
• 31:38
  Speaker 6: like cultural and social and political issues don't always exist
• 31:42
  Speaker 6: as clearly, I guess. So then it's harder to get into.
• 31:47
  Speaker 6: The week getting into the weeds for us is like, well,
• 31:49
  Speaker 6: what did Althusser say? But it's not like w what's
• 31:53
  Speaker 6: the data on this and like what's happening in the
• 31:56
  Speaker 6: real world. It's a little bit more difficult to get
• 31:59
  Speaker 6: into that. So yeah, you, you have those checks you
• 32:02
  Speaker 6: can do, which is nice. I don't know if there's
• 32:05
  Speaker 6: a question in this, but.
• 32:06
  Speaker 1: That's... I'll graft a question off that if I can.
• 32:10
  Speaker 1: You began by describing economics as not predictive, and then
• 32:15
  Speaker 1: we kind of just slipped into managerial. And you said
• 32:19
  Speaker 1: all your friends are going to whatever, National Bank, World Bank, IMF.
• 32:25
  Speaker 1: So this all seems like managerial stuff. What is the
• 32:29
  Speaker 1: overlap between, I guess, explanatory economics, maybe what you do,
• 32:35
  Speaker 1: versus the supposedly predictive economics, versus the people who are
• 32:41
  Speaker 1: making decisions about regulation? Are politicians informed by people who
• 32:48
  Speaker 1: are making the bad predictions that you talked about in
• 32:51
  Speaker 1: the first place?
• 32:52
  Speaker 2: That's a really good question. In some arenas, it is
• 32:59
  Speaker 2: the case. So one of the clearest examples would be
• 33:02
  Speaker 2: central bank forecasts. Now, central bank forecasts are just famously
• 33:06
  Speaker 2: a joke, right? They're like, oh, GDP will be this,
• 33:10
  Speaker 2: inflation will be this, unemployment will be this. And with
• 33:15
  Speaker 2: that kind of data, macroeconomic data, yeah, a trend will
• 33:19
  Speaker 2: generally continue roughly where it's been going. If GDP growth
• 33:24
  Speaker 2: was 2% one year, then it will be between 2.5%
• 33:27
  Speaker 2: and 1.5% the next year, except for when it isn't.
• 33:32
  Speaker 2: Except when there's a recession that nobody saw coming. Right.
• 33:35
  Speaker 2: And so it's like the predictions almost about the forecast
• 33:39
  Speaker 2: almost about to like, well, it's going to keep going,
• 33:42
  Speaker 2: you know, roughly as it is now. But it could not.
• 33:47
  Speaker 2: And so that is useless. Right. And central banks still
• 33:50
  Speaker 2: do it. they still produce these forecasts. They just like,
• 33:53
  Speaker 2: it's kind of like this bullshit complex where everybody like
• 33:57
  Speaker 2: knows that they don't really work and just goes with
• 33:59
  Speaker 2: them anyway. And, you know, sometimes if, if politicians make
• 34:03
  Speaker 2: a statement about, you know, this, this is going to happen,
• 34:05
  Speaker 2: the economy, this new program is going to create so-and-so jobs.
• 34:08
  Speaker 2: It will come from this kind of analysis. So I
• 34:10
  Speaker 2: do think, I do think you get it kind of,
• 34:13
  Speaker 2: you do, you do get it. In terms of like
• 34:16
  Speaker 2: the finer academic theories where people are making like you know,
• 34:20
  Speaker 2: really specific predictions about, I don't know, like the sort
• 34:26
  Speaker 2: of the steel industry or like some economic model about
• 34:29
  Speaker 2: preferences and, you know, what's the estimated level of risk
• 34:34
  Speaker 2: aversion in the economy or something like that. Like that's
• 34:36
  Speaker 2: not going to make its way into policy in any
• 34:40
  Speaker 2: meaningful sense.
• 34:41
  Speaker 1: So these theories that are produced, they're produced for their
• 34:45
  Speaker 1: own sake or is like, is McKinsey going to be interested?
• 34:48
  Speaker 4: Oh, you wrote it.
• 34:49
  Speaker 1: You wrote a niche theory about the steel industry. Is
• 34:52
  Speaker 1: McKinsey going to be interested or like a hedge fund
• 34:55
  Speaker 1: or private equity?
• 34:57
  Speaker 2: I don't think so. I think if they are, it's
• 35:02
  Speaker 2: one of those things where they've already made a decision
• 35:05
  Speaker 2: and they're like, give us some fancy theory to reify
• 35:09
  Speaker 2: our existing decision. But no, they don't. I mean, my
• 35:12
  Speaker 2: supervisor once said, the most complicated thing you will explain
• 35:17
  Speaker 2: to a politician is is like a second year macroeconomic
• 35:20
  Speaker 2: model like no more.
• 35:22
  Speaker 6: Yeah unless it's mark carney then he's a he's an
• 35:25
  Speaker 6: expert banker then.
• 35:28
  Speaker 5: We share mark carney because he was the he was
• 35:30
  Speaker 5: the bank of our he was like the the president
• 35:32
  Speaker 5: or what do they call it the president or the
• 35:34
  Speaker 5: chair of the bank of england or the.
• 35:36
  Speaker 2: He what yeah he was the governor yeah yeah the
• 35:38
  Speaker 2: governor that's the word i do yeah i do kind
• 35:40
  Speaker 2: of understand people who believe that there's a sort of
• 35:42
  Speaker 2: like uh illuminati when things like that happen it's like
• 35:46
  Speaker 2: how is he allowed to do both of those jobs
• 35:48
  Speaker 2: it's like it's crazy um and that's not even a
• 35:51
  Speaker 2: comment on how competent he is but i just don't
• 35:53
  Speaker 2: think that you should be able to hold two like
• 35:57
  Speaker 2: bit of the biggest positions in the biggest countries in
• 35:59
  Speaker 2: the world you know back to back basically yeah it
• 36:04
  Speaker 2: is bizarre It's weird. Yeah.
• 36:07
  Speaker 6: And the conservatives looked like they were going to win
• 36:10
  Speaker 6: in Canada. And then Trump started with his 51st state
• 36:13
  Speaker 6: talk right during the election. And it just swung things.
• 36:18
  Speaker 6: People went completely voted for a liberal. And I guess
• 36:22
  Speaker 6: it helps that everyone thinks there's a financial economic crisis, whatever.
• 36:26
  Speaker 6: And he was a banker. So everyone's like, well, he's
• 36:28
  Speaker 6: got the knowledge for that, too. He's not like Justin Trudeau,
• 36:31
  Speaker 6: just like a musician, teacher, whatever, does whatever. does yoga. No, he's,
• 36:35
  Speaker 6: he's got some, uh, he's got some real knowledge behind it.
• 36:39
  Speaker 5: It sounds like, well, I'm, I'm curious, what's the, uh, maybe,
• 36:43
  Speaker 5: I don't know if you, if you're, if you'll be
• 36:45
  Speaker 5: comfortable answering this question, but it could be interesting to
• 36:49
  Speaker 5: some of our listeners. What's, what do you think the
• 36:51
  Speaker 5: biggest problem with the labor theory of value is, or
• 36:53
  Speaker 5: do you have a, do you have a perspective on
• 36:55
  Speaker 5: the labor theory of value?
• 36:56
  Speaker 6: I definitely saw videos out recently on this.
• 37:02
  Speaker 2: Yeah, I did. So those are old videos that I
• 37:04
  Speaker 2: did like supporter only. So I yeah, I just re-released
• 37:09
  Speaker 2: them for YouTube members because I started YouTube membership. Boring story.
• 37:11
  Speaker 2: But anyway, they are a little bit old. But I
• 37:13
  Speaker 2: so yeah, the labor theory of value is funny. I'm
• 37:15
  Speaker 2: actually working on a second channel video about it now.
• 37:18
  Speaker 2: That's kind of a follow up because I think I
• 37:20
  Speaker 2: needed to clarify some things. But my perspective on the
• 37:23
  Speaker 2: labor theory of value is essentially the exactly what I
• 37:26
  Speaker 2: told you about positivism at the start, if we're still
• 37:30
  Speaker 2: using that word. I think that some adherents of the
• 37:34
  Speaker 2: labor theory of value make claims about how predictive it
• 37:39
  Speaker 2: is of actual behavior in a capitalist economy. And we're
• 37:43
  Speaker 2: talking big predictions, right? We're talking, you're saying that labor
• 37:47
  Speaker 2: is the predictor of like output and the source of profit, right?
• 37:51
  Speaker 2: And depending on who you ask, maybe predicts prices as.
• 37:54
  Speaker 1: Well, right?
• 37:54
  Speaker 2: That's the big, that's the holy grail of economics, right?
• 37:58
  Speaker 2: And then I go and look at some of this
• 37:59
  Speaker 2: literature and I've had a lifelong interest in Marxist economics
• 38:02
  Speaker 2: and like I still do. strongly that Marxist economics is
• 38:06
  Speaker 2: underrepresented in academia and in policy discussions. So I would
• 38:11
  Speaker 2: always campaign for it to be included. But when I
• 38:13
  Speaker 2: look at some of the statistical stuff, it's really... And
• 38:18
  Speaker 2: I hate being that guy. You are confusing correlation and
• 38:21
  Speaker 2: causation in the most basic way. I actually really... I
• 38:24
  Speaker 2: get really surprised by this literature because I'm like, well,
• 38:29
  Speaker 2: these people are all like... Some of them are academics
• 38:31
  Speaker 2: and some of this is published. And I'm like, But
• 38:34
  Speaker 2: it's just a correlation. That's what it says. It's not
• 38:38
  Speaker 2: my word. It's like they're like, there is a correlation
• 38:40
  Speaker 2: between labor hours and output, right? A high correlation. It's like,
• 38:44
  Speaker 2: no shit, because labor hours are really crucial for making things.
• 38:48
  Speaker 2: Nobody denies that labor is a factor of production and
• 38:51
  Speaker 2: a major one. It's really odd to look at this
• 38:53
  Speaker 2: stuff and you just go, huh, I don't really think
• 38:56
  Speaker 2: that's good enough. Now, to loop back around... I would
• 38:58
  Speaker 2: say the labor theory of value, I found it's very
• 39:02
  Speaker 2: intrinsically difficult to test. And this applies to any theory
• 39:05
  Speaker 2: of value, by the way, because value is not observable.
• 39:10
  Speaker 2: Value is like a concept, right? So it's not like
• 39:12
  Speaker 2: we've got the gravity coefficient and we're making a prediction
• 39:17
  Speaker 2: because gravity is the way it is and we don't
• 39:20
  Speaker 2: really know why, but it is, right, empirically. It's not
• 39:22
  Speaker 2: like that. We've got unobservable quantities that we're using to
• 39:26
  Speaker 2: predict observable quantities, And that's just very, very, very hard.
• 39:30
  Speaker 2: And you end up with these extremely loose tests that statistically,
• 39:33
  Speaker 2: I just don't really think cut the mustard.
• 39:37
  Speaker 4: Yeah.
• 39:38
  Speaker 1: There was a pretty angry YouTube video discrediting your critique.
• 39:42
  Speaker 2: Yes.
• 39:43
  Speaker 1: Of the labor theory of value, because Marxists who are
• 39:47
  Speaker 1: philosophers get very precious about this.
• 39:51
  Speaker 6: Yeah, it's always the optics of criticizing it is tough.
• 39:56
  Speaker 1: Okay, labor theory of value. A, it's not Marxist theory.
• 39:59
  Speaker 1: He picks it up from.
• 40:00
  Speaker 6: No, that's Ricardo.
• 40:01
  Speaker 1: From Ricardo.
• 40:02
  Speaker 4: But according to... See, all the economists are British. David Harvey.
• 40:10
  Speaker 1: most famous Marxist economist in the world, he writes a
• 40:13
  Speaker 1: paper that says the labor theory of value has been discredited.
• 40:16
  Speaker 4: Yeah.
• 40:18
  Speaker 6: And Marx never subscribed to it in the first place.
• 40:20
  Speaker 6: He criticized it. But no one knows.
• 40:24
  Speaker 1: Philosophy majors get extremely precious about the labor theory of value.
• 40:27
  Speaker 4: Like the theory hinges on this thing. It's important.
• 40:32
  Speaker 6: I love getting into the weeds in this on my
• 40:34
  Speaker 6: own time. And the people I look to for clarification
• 40:38
  Speaker 6: are people like Michael Heinrich. who's a cutting-edge scholar and
• 40:43
  Speaker 6: works in the Marx archives, and Fred Mosley, who's a
• 40:48
  Speaker 6: Marxist macroeconomist and wrote a big book on dealing with
• 40:55
  Speaker 6: the transformation problem and how it doesn't really apply. Prices
• 41:02
  Speaker 6: and value are not just two separate tracks that can
• 41:05
  Speaker 6: be correlated. But anyway, yeah, there, I'm already getting into
• 41:08
  Speaker 6: the weeds about it. But yeah, then vulgarizing Marx, it's
• 41:12
  Speaker 6: just like, yeah, labor is the key input and nothing
• 41:17
  Speaker 6: else really matters. And then if you say anything against that,
• 41:21
  Speaker 6: you're like, oh, you're working for the CIA.
• 41:26
  Speaker 2: This is my conclusion in my original video on this.
• 41:29
  Speaker 2: And I think in the video I'm working on at
• 41:31
  Speaker 2: the moment, I'll say the same thing again. If your
• 41:34
  Speaker 2: entire worldview hinges on whether a coefficient is statistically significant-
• 41:40
  Speaker 2: then you're going to have a really bad time. Because
• 41:43
  Speaker 2: anyone who's dealt with statistics knows that it just shows
• 41:47
  Speaker 2: up like loads of different ways. And there's always something
• 41:49
  Speaker 2: that's wrong with the theory. And it never really maps
• 41:52
  Speaker 2: out that way. I just think it's better to keep
• 41:57
  Speaker 2: some variant of the labor theory of value or even
• 41:59
  Speaker 2: Marxism broadly as an extremely valuable lens through which to
• 42:03
  Speaker 2: look at capitalism. I mean, I've cited Marxist economistics extensively.
• 42:07
  Speaker 2: I think you said, David Harvey, He probably is the
• 42:10
  Speaker 2: most famous Marxist economist. My favorite is Ellen Mixon's Wood, though.
• 42:13
  Speaker 2: I think she's just like her historical stuff is just unparalleled,
• 42:17
  Speaker 2: like on the origin of capitalism and democracy and capitalism
• 42:23
  Speaker 2: as well. I just I love her work. I think
• 42:25
  Speaker 2: it's amazing. Right. And Marxists tend to ask questions that
• 42:28
  Speaker 2: mainstream economists don't. They tend to be more historically specific, right?
• 42:32
  Speaker 2: They don't see capitalism and markets as just this kind
• 42:35
  Speaker 2: of thing that exists. They're like, where did this come from?
• 42:37
  Speaker 2: How did this happen? All the right questions to ask,
• 42:40
  Speaker 2: but we just don't need to be too doctrinaire about
• 42:42
  Speaker 2: the answer.
• 42:44
  Speaker 5: Yeah, no, it strikes me that your kind of critique
• 42:47
  Speaker 5: of the labor theory of value is like, it's just
• 42:49
  Speaker 5: a broader critique of being too much of a positivist
• 42:52
  Speaker 5: in a way, right?
• 42:53
  Speaker 3: It's just like, You're doing the thing. If your whole.
• 42:57
  Speaker 5: View hinges on that thing, you're doing the same thing
• 43:00
  Speaker 5: that these other positivists are doing. And I think it's
• 43:03
  Speaker 5: right to just be like, that seems like a bad idea.
• 43:05
  Speaker 5: You're going to end up being disappointed if you try
• 43:08
  Speaker 5: to have this rigid model of the world. So that
• 43:12
  Speaker 5: makes total sense to me.
• 43:13
  Speaker 6: Or I guess you've been thinking about what's his name,
• 43:17
  Speaker 6: Thomas Sowell lately.
• 43:18
  Speaker 2: Just a little bit, yeah.
• 43:22
  Speaker 6: Yeah, and you call him an anti-intellectualist, but then, because
• 43:29
  Speaker 6: he just views intellectuals with utter disdain, it seems, but
• 43:34
  Speaker 6: then he does the thing he says that they all
• 43:38
  Speaker 6: are doing and what makes them wrong, and then he
• 43:40
  Speaker 6: does the same things. He cherry picks, he misrepresents, he
• 43:44
  Speaker 6: cuts quotes, he does all that sort of stuff. So
• 43:47
  Speaker 6: it seems like a structurally similar sort of thing going
• 43:51
  Speaker 6: on there, too.
• 43:52
  Speaker 2: I think there's this real impetus and it happens on
• 43:56
  Speaker 2: the Internet quite a lot on social media. But I
• 43:58
  Speaker 2: think it predates that is like this to be like,
• 44:02
  Speaker 2: you know, I'm outside of all of it. I'm outside
• 44:05
  Speaker 2: of the intellectuals. You know, for a Marxist, they might
• 44:07
  Speaker 2: be like, well, that's just bourgeoisism. economics i think marx
• 44:10
  Speaker 2: called it vulgar economics right like that'd be like oh
• 44:13
  Speaker 2: you know or for thomas soul he has this term
• 44:15
  Speaker 2: the anointed right he calls the intellectuals the anointed and
• 44:18
  Speaker 2: i feel like acting like you're kind of outside all
• 44:21
  Speaker 2: of this discussion and you're the only one that can
• 44:24
  Speaker 2: kind of tell the truth and i i just think
• 44:27
  Speaker 2: it's a real um kind of uh i don't know
• 44:31
  Speaker 2: desire uh that that people seem to have right because
• 44:35
  Speaker 2: i think it makes them feel like they're they're above
• 44:38
  Speaker 2: things and i just think my main point is you're
• 44:40
  Speaker 2: not you're you're you know you're in it you're you're
• 44:42
  Speaker 2: in it with.
• 44:43
  Speaker 6: The rest of us yeah for us it's ideology i
• 44:46
  Speaker 6: guess that crops up too it's like can you step
• 44:48
  Speaker 6: outside of ideology and have some kind of objective view
• 44:51
  Speaker 6: of things but then on the other hand it's like
• 44:55
  Speaker 6: oh well it's all relative then and you get into
• 44:57
  Speaker 6: these problems never-ending stream of.
• 45:00
  Speaker 2: Episodes difficult i mean it's it's fucking difficult right i
• 45:03
  Speaker 2: think like um that it's it's Social science and philosophy,
• 45:10
  Speaker 2: it's just really, really hard. And I would never want
• 45:13
  Speaker 2: to pretend that I have all the answers. But I
• 45:14
  Speaker 2: just think there are too many people that want that
• 45:17
  Speaker 2: kind of certainty. And I think the only honest position
• 45:21
  Speaker 2: is that you're never going to get it.
• 45:23
  Speaker 4: What's the mission?
• 45:24
  Speaker 1: I don't want to get too existential here. If economics
• 45:30
  Speaker 1: is flawed, but no one's listening to economists anyway past
• 45:35
  Speaker 1: second year, studies, then what do you think the problem
• 45:40
  Speaker 1: is and what's your mission?
• 45:43
  Speaker 2: It's a good question. And I think my mission has changed.
• 45:46
  Speaker 2: I think I had more of a focus on academia
• 45:48
  Speaker 2: and teaching for a long time until eventually I realized
• 45:51
  Speaker 2: that via platforms like YouTube and also blogging, you can
• 45:55
  Speaker 2: kind of go around academia and be as influential or
• 45:58
  Speaker 2: more influential than most academics. And I kind of realized
• 46:02
  Speaker 2: that probably, probably more, you know, like it's, it's correct.
• 46:06
  Speaker 2: Some of the view, I mean, I know YouTube views
• 46:08
  Speaker 2: are even before the change, you know, it doesn't mean
• 46:11
  Speaker 2: that you're, you're necessarily having a direct impact, but I
• 46:14
  Speaker 2: just remember being very shocked by the number of people
• 46:16
  Speaker 2: that would watch my videos and pay attention as well.
• 46:19
  Speaker 2: Cause I read some comments and people like, oh, I
• 46:20
  Speaker 2: took notes on this and I've watched it three times.
• 46:22
  Speaker 2: And I was like, Jesus, that's, that's insane. You know? Um,
• 46:25
  Speaker 2: so public education is really my mission and it's something
• 46:28
  Speaker 2: that I, I talked about the failings of, of, of
• 46:31
  Speaker 2: the discipline of economics. This applies to all of academia,
• 46:35
  Speaker 2: but public education is just not a priority in academia.
• 46:38
  Speaker 2: It's not rewarded at all. There's very little outreach in
• 46:42
  Speaker 2: most universities from what I can see. Universities are often
• 46:45
  Speaker 2: not really situated in the local community, for instance. They
• 46:49
  Speaker 2: don't do much for local communities, all that kind of thing.
• 46:52
  Speaker 2: I think that's a real massive failing because I think
• 46:56
  Speaker 2: that ultimately your task should be to educate and inform
• 47:00
  Speaker 2: and aid students. the general public, and that's the main
• 47:06
  Speaker 2: thing that I'm trying to do with the channel these days.
• 47:09
  Speaker 6: I guess this is a question about your background too,
• 47:11
  Speaker 6: because you've said, I've seen you say, that you have
• 47:16
  Speaker 6: a background in behavioral economics, and recently you talked about
• 47:21
  Speaker 6: institutionalism in economics as well. And so what, for people
• 47:27
  Speaker 6: like that goes back to Veblen, I guess, is that,
• 47:30
  Speaker 6: is that right? Which, so if people who are curious
• 47:33
  Speaker 6: about economics and want to learn more, but don't just
• 47:37
  Speaker 6: want to like read Bloomberg or Yahoo finance or something,
• 47:41
  Speaker 6: they want to like learn about the nuts and bolts
• 47:43
  Speaker 6: a little bit. Is it just go back and read, well,
• 47:47
  Speaker 6: I guess, Marx and Keynes, but also Veblen and like,
• 47:50
  Speaker 6: how would you outreach to. for economic knowledge. I mean,
• 47:54
  Speaker 6: besides putting out like videos and talking to the audience directly,
• 47:59
  Speaker 6: if people want to pursue it on their own time
• 48:01
  Speaker 6: kind of thing too.
• 48:02
  Speaker 2: Yeah. Usually in a video, I'll have one moment where
• 48:06
  Speaker 2: I say, if you read one thing from this video,
• 48:09
  Speaker 2: make it this, and it'll be like an article or whatever. Right.
• 48:14
  Speaker 2: So I will tend to do that in a video.
• 48:16
  Speaker 2: I try to give people pointers in terms of institutional economics.
• 48:19
  Speaker 2: I have to say, I'm extremely impressed by the, like
• 48:21
  Speaker 2: the level of research that that you guys have done
• 48:23
  Speaker 2: all my like members only videos, all the videos like
• 48:26
  Speaker 2: trashing me, you know what I mean? You've watched it
• 48:29
  Speaker 2: all between you. So yeah, that institutional economics, it does
• 48:34
  Speaker 2: kind of start with Veblen, but also in a way,
• 48:38
  Speaker 2: institutional economics isn't that complicated. It just says that you
• 48:41
  Speaker 2: need to pay attention to the history and the reality
• 48:45
  Speaker 2: of a situation. Now, maybe this is where the word
• 48:47
  Speaker 2: realist comes from, because I don't like proceeding based on
• 48:50
  Speaker 2: abstract theories. I like looking at an area. So when
• 48:52
  Speaker 2: you were saying about the grocery situation in Canada, that
• 48:55
  Speaker 2: was very interesting. And I think that would clearly inform
• 48:59
  Speaker 2: any policy position on the topic. So in that sense,
• 49:01
  Speaker 2: I just think institutional economics is like, well, what is it?
• 49:04
  Speaker 2: Look at the institutions, which means the organizations that are there,
• 49:07
  Speaker 2: the corporations, the law, right culture as well, things like that,
• 49:11
  Speaker 2: all the things that inform the situation in a given
• 49:14
  Speaker 2: time and place. And economics was like that for a
• 49:17
  Speaker 2: very long time, you know, even, you know, before Veblen,
• 49:20
  Speaker 2: if you look at, you know, is Adam Smith an
• 49:22
  Speaker 2: institutional economist? I think so. I think he's observing the
• 49:25
  Speaker 2: world around him, right? And he, you know, he goes
• 49:28
  Speaker 2: into great detail about i think he talks about a
• 49:32
  Speaker 2: flower shop for about 80 pages of the wealth of
• 49:34
  Speaker 2: nations or something if you read in the unabridged version
• 49:38
  Speaker 2: so he's like he's got this attention to detail right
• 49:41
  Speaker 2: um so that's just the thing with institutional economics it's
• 49:44
  Speaker 2: like historical specificity um and again a lot of relationship
• 49:48
  Speaker 2: to marxism but in the 20th century when economics became
• 49:51
  Speaker 2: more abstract and more neoclassical more focused on formal modeling
• 49:56
  Speaker 2: um deductive methods right like uh you know from these axioms,
• 50:00
  Speaker 2: we can introduce this theory, and then maybe if there's time,
• 50:02
  Speaker 2: we'll apply it to reality, but also it just stands alone.
• 50:05
  Speaker 2: That type of thing, that really took over economics. Now,
• 50:08
  Speaker 2: I think we've seen a bit of a shift back
• 50:10
  Speaker 2: away from that again, but that is the kind of
• 50:13
  Speaker 2: thing that I just, I think was actually more of
• 50:15
  Speaker 2: a historical anomaly. I think institutional economics was very much
• 50:18
  Speaker 2: the norm for a long time.
• 50:21
  Speaker 6: Yeah, and institutions, quote unquote, don't just mean like brick
• 50:26
  Speaker 6: and mortar buildings, just to get real confusing with it.
• 50:29
  Speaker 6: It also like covers things like language and habits and
• 50:33
  Speaker 6: rituals and repeated things as well. So when you say,
• 50:36
  Speaker 6: look at the world around you and the institutions and
• 50:39
  Speaker 6: corporations involved, it does sort of mean, yeah, a little
• 50:43
  Speaker 6: bit broader than what someone might think of as an institution.
• 50:46
  Speaker 2: It encourages critical thinking, I think inherently that kind of perspective,
• 50:50
  Speaker 2: because exactly what you just said, like how does language
• 50:53
  Speaker 2: affect the economy. Like I, I don't have, I wish
• 50:56
  Speaker 2: I had a really neat example, but like I I'm
• 51:00
  Speaker 2: sure in all sorts of ways.
• 51:01
  Speaker 6: Right.
• 51:02
  Speaker 2: And if you're, if you only speak English, I'm sure
• 51:04
  Speaker 2: you could miss a lot of things about your own economy,
• 51:07
  Speaker 2: but also about like, especially about, about other economies. Right.
• 51:11
  Speaker 1: So speaking of that, we can kind of wind it
• 51:13
  Speaker 1: down here, but I, we, we do have to ask you,
• 51:15
  Speaker 1: cause what, what normal people who, you know, very normal
• 51:20
  Speaker 1: trained by trained by Twitter algorithms.
• 51:22
  Speaker 4: What we think of.
• 51:23
  Speaker 1: The economy right now is bubble, AI. It's very scary.
• 51:28
  Speaker 4: It's very dangerous.
• 51:30
  Speaker 6: We're all going extinct.
• 51:31
  Speaker 4: Financial advice, please.
• 51:33
  Speaker 1: But no, I just mean you hear like the chip
• 51:36
  Speaker 1: makers are invested in the cloud providers and the cloud
• 51:39
  Speaker 1: providers are invested in the tech companies who are invested.
• 51:42
  Speaker 4: So all the money is fake.
• 51:44
  Speaker 1: All things are based on future speculation of profits that
• 51:47
  Speaker 1: would be impossible. There's bad indicators from the bond market.
• 51:51
  Speaker 1: What's your opinion on all this? The fear, I guess,
• 51:57
  Speaker 1: the fear, the pervasive fear, the money still goes up,
• 52:02
  Speaker 1: but there's no jobs, all of that, those indicators.
• 52:05
  Speaker 3: I guess, are you afraid too?
• 52:08
  Speaker 2: Yes, I am. I am, actually. And you're right, the
• 52:14
  Speaker 2: magnitudes involved with some of these AI companies and the
• 52:18
  Speaker 2: circuitous nature of the investments, I mean, they're just mind-boggling.
• 52:23
  Speaker 2: You know, it's just amounts of money that none of
• 52:26
  Speaker 2: us can really, really comprehend and which don't really exist.
• 52:30
  Speaker 2: Like you said, you know, they're like stock market valuations.
• 52:34
  Speaker 2: They're like predictions, you know what I mean? And it's just,
• 52:36
  Speaker 2: it all seems like just ethereal. It's like Matthew McConaughey
• 52:42
  Speaker 2: in Wolf of Wall Street. It's not really there. It
• 52:47
  Speaker 2: is just utterly insane. I can't see how it could
• 52:50
  Speaker 2: continue indefinitely. The only thing that I think could happen,
• 52:54
  Speaker 2: which has also already happened in a way, is just
• 53:00
  Speaker 2: the US government underpins all of it and guarantees all
• 53:03
  Speaker 2: of it, kind of like they did with the banks
• 53:05
  Speaker 2: in 2008. There's a great article by a guy called
• 53:08
  Speaker 2: Joseph Politano who has really good economic analysis, but he
• 53:11
  Speaker 2: basically looks at all the tariffs and he says that
• 53:14
  Speaker 2: if you read the US tariffs, they were kind of
• 53:17
  Speaker 2: exempting AI. They were kind of built around an AI economy.
• 53:22
  Speaker 2: And I just think it's going to become a case
• 53:25
  Speaker 2: of the US has to fall for the AI bubble
• 53:28
  Speaker 2: to fall. Otherwise, they'll just keep funding it. And that
• 53:32
  Speaker 2: could happen economically. I think people could move towards a
• 53:36
  Speaker 2: different reserve currency, but they do have a lot of leeway.
• 53:39
  Speaker 2: So I just think they're going to keep doing it.
• 53:42
  Speaker 2: And Mark Carney, he's been very welcoming to AI. Keir
• 53:45
  Speaker 2: Starmer was in the UK. And I just worry that
• 53:51
  Speaker 2: we'll have this whole economy that even if the bubble
• 53:54
  Speaker 2: doesn't burst, it's just sort of geared towards propping up
• 53:57
  Speaker 2: this industry, right? And that just becomes everything. And that
• 54:02
  Speaker 2: for me, people talk about AI being, you know, AGI,
• 54:06
  Speaker 2: you know, taking over, kill all humans. People also talk
• 54:11
  Speaker 2: about it replacing jobs, you know, that kind of stuff
• 54:14
  Speaker 2: doesn't bother me as much as just the financial aspect
• 54:19
  Speaker 2: of it, where it's like, the entire economy revolves around
• 54:22
  Speaker 2: it and becomes dependent on it, right? And then it's
• 54:25
  Speaker 2: sort of insidious and it just becomes so too big
• 54:28
  Speaker 2: to fail, right? That is what really worries me about
• 54:31
  Speaker 2: the AI industry.
• 54:33
  Speaker 1: It is. And it's very strange to see it kind of...
• 54:36
  Speaker 1: I mean, speaking of your shirt, normal people didn't see
• 54:40
  Speaker 1: that coming. Normal people weren't predicting the collapse. But it's
• 54:44
  Speaker 1: interesting to see everybody worried about it. It seems inevitable.
• 54:48
  Speaker 4: It's very.
• 54:49
  Speaker 1: it's very public in the way that the housing crisis
• 54:54
  Speaker 1: would not.
• 54:55
  Speaker 2: Yeah. Yeah, it's so interesting. I think the financial crisis
• 54:59
  Speaker 2: sparked so much interest in economics and the news and
• 55:03
  Speaker 2: everyone's like hyper attuned now that it's kind of difficult.
• 55:06
  Speaker 2: I mean, who knows? Maybe the bubble is just something
• 55:09
  Speaker 2: else that we're all missing. Maybe it's just like we're
• 55:11
  Speaker 2: forever doomed to miss the bubble.
• 55:13
  Speaker 4: A foam?
• 55:15
  Speaker 5: It's weird that when you described that the US will
• 55:18
  Speaker 5: probably just like backstop the AI industry, it's kind of
• 55:23
  Speaker 5: made me feel better.
• 55:24
  Speaker 3: That's kind of horrible. Like it made me feel slightly better,
• 55:27
  Speaker 3: but like that makes sense to me.
• 55:29
  Speaker 5: Like they have so much invested in it, but yeah,
• 55:31
  Speaker 5: obviously like a doomsday scenario in, I mean, in a
• 55:34
  Speaker 5: certain sense, doomsday scenario.
• 55:35
  Speaker 1: And they're all asking for it too. That's what they're
• 55:38
  Speaker 1: actually asking for. They're like, please backstop us. But they're
• 55:40
  Speaker 1: saying you have to regulate us or we will actually
• 55:44
  Speaker 1: kill everything.
• 55:45
  Speaker 2: Yeah, exactly.
• 55:45
  Speaker 4: Please regulate us.
• 55:47
  Speaker 3: Please.
• 55:48
  Speaker 6: Yeah, it's so, again, the specifics come into play and
• 55:52
  Speaker 6: it's so interesting, you know, the ownership model of open
• 55:56
  Speaker 6: AI versus like the Chinese ones, like deep seek and stuff.
• 56:00
  Speaker 6: They're completely different sort.
• 56:02
  Speaker 2: Of model, but I.
• 56:05
  Speaker 6: Yeah. I don't know. I guess. And then I don't
• 56:07
  Speaker 6: understand how bubbles and things work. Like, of course I
• 56:10
  Speaker 6: watched the big short. I did my homework on 2008.
• 56:13
  Speaker 6: And then, and then there's another one I heard of
• 56:16
  Speaker 6: when I was like 11, when it happened, the.com bubble, the.com
• 56:21
  Speaker 6: bubble burst. And that was bad. And then before I
• 56:24
  Speaker 6: was born, I don't know, maybe the 1970s oil shock.
• 56:28
  Speaker 6: I don't know if that's another thing to look for, but, uh,
• 56:31
  Speaker 6: to look at for a precursor?
• 56:33
  Speaker 2: Not financial advice, maybe something you'd want to think about
• 56:36
  Speaker 2: investing in. Because I do think if you look at
• 56:38
  Speaker 2: like the price of live gigs, that's actually gone up
• 56:40
  Speaker 2: quite a lot. Because anything you can guarantee isn't AI,
• 56:44
  Speaker 2: I think will become quite sought after. That's a good point.
• 56:48
  Speaker 3: That's a good point.
• 56:50
  Speaker 2: Yeah, even podcasting, I think.
• 56:52
  Speaker 5: Really quickly, a little anecdote about how much absurd amounts
• 56:55
  Speaker 5: of money are being invested in ai because right now
• 56:58
  Speaker 5: i haven't been able to get another academic position so
• 57:01
  Speaker 5: i like just applied for random stuff and i've been
• 57:03
  Speaker 5: doing actually signed a confidentiality agreement so i'm not allowed
• 57:06
  Speaker 5: to talk about like the specifics of it but i
• 57:08
  Speaker 5: like training whoa i'm like training the ai models i'm
• 57:11
  Speaker 5: like reading stuff and critiquing it like on my own
• 57:14
  Speaker 5: time and like it's it's really easy and they're paying
• 57:18
  Speaker 5: me like 70 usd per hour to just like.
• 57:22
  Speaker 3: Like read stuff and critique.
• 57:23
  Speaker 2: I've heard of these jobs.
• 57:25
  Speaker 5: They have like 35,000 people on this one project. And
• 57:28
  Speaker 5: it's like, it's just absurd to me. And like, I'm like, wow,
• 57:31
  Speaker 5: these companies are as comfortable paying this amount of money
• 57:34
  Speaker 5: to just like people to sit at home and read
• 57:36
  Speaker 5: stuff and like write little critiques.
• 57:37
  Speaker 3: It's crazy.
• 57:39
  Speaker 1: That's just what I need is a chat GPT that
• 57:41
  Speaker 1: talks like you.
• 57:41
  Speaker 2: Oh my God. Yeah.
• 57:46
  Speaker 6: Maybe they'll have one for podcasts too. Listen and critique
• 57:48
  Speaker 6: this podcast.
• 57:50
  Speaker 3: It just can't be sustainable.
• 57:51
  Speaker 4: My chat GPT is too extreme. I need a centrist
• 57:54
  Speaker 4: chat GPT.
• 57:56
  Speaker 2: Yeah.
• 57:57
  Speaker 6: More labor theory of value in there.
• 57:59
  Speaker 1: I start every chat GPT conversation by pretend you're an extremist.
• 58:06
  Speaker 2: That's fun.
• 58:07
  Speaker 3: That's a fun way of doing it.
• 58:08
  Speaker 5: I was going to ask you a prospect theory, but
• 58:09
  Speaker 5: I think we're getting close to time.
• 58:12
  Speaker 3: I don't know if you want to... Because that was
• 58:13
  Speaker 3: your research, was it not?
• 58:15
  Speaker 2: Yeah, yeah, it was. Yeah, prospect theory. But I don't
• 58:18
  Speaker 2: really care about it that much. I'm not going to lie.
• 58:23
  Speaker 2: That's how you know I wrote a PhD on the topic.
• 58:25
  Speaker 2: I do not want to talk about it.
• 58:26
  Speaker 3: Yeah, no, for sure. I feel the same way about mine.
• 58:30
  Speaker 4: I feel that. I feel that.
• 58:32
  Speaker 1: Speaking of projects that have come and gone, do you
• 58:34
  Speaker 1: still recommend your book?
• 58:36
  Speaker 2: Yeah, yeah, I do. I do recommend it. It's interesting
• 58:40
  Speaker 2: you say that because I really, when I was writing it,
• 58:42
  Speaker 2: I was so acutely aware of how fast things change. Now,
• 58:48
  Speaker 2: if you read it, it's very clearly pre-Trump 2.0 and
• 58:51
  Speaker 2: pre-AI boom, right? You can read that. I don't even
• 58:55
  Speaker 2: mention AI. And that was kind of a deliberate choice.
• 58:58
  Speaker 2: But I think I finished writing it October 2024. So
• 59:02
  Speaker 2: you're talking about like literally just that post-pandemic sort of pre-Trump,
• 59:06
  Speaker 2: pre-AI period. And things have changed in what, like it's
• 59:09
  Speaker 2: been less than two years. But I think I was
• 59:15
  Speaker 2: wrestling with that when I was writing it and I
• 59:17
  Speaker 2: spoke to my editor and he was like, look, it's nice,
• 59:19
  Speaker 2: it's good to have a book that is of a time.
• 59:22
  Speaker 2: And I hope that aside from having some hopefully sort
• 59:25
  Speaker 2: of generally applicable and interesting economic analysis, I think the
• 59:29
  Speaker 2: book does capture that kind of spirit of why, you know,
• 59:33
  Speaker 2: why we're getting poorer, right? That like feeling in the
• 59:36
  Speaker 2: cost of living crisis just after the pandemic, like what
• 59:38
  Speaker 2: the hell's going on with the economy? Why does all
• 59:40
  Speaker 2: this horrible stuff keep happening? Wars and, you know, so yeah,
• 59:45
  Speaker 2: my hope is that it's good to read for that reason,
• 59:48
  Speaker 2: even if for no other reason.
• 59:50
  Speaker 6: It's like what you said about John Dewey's book. uh,
• 59:54
  Speaker 6: liberalism and social, it's like a time capsule. It captures
• 59:58
  Speaker 6: very well what it says at its time and what
• 1:00:01
  Speaker 6: people are thinking and, and soul's take on it is,
• 1:00:04
  Speaker 6: is nonsense.
• 1:00:06
  Speaker 2: Soul's take on it is he's a communist. Yeah.
• 1:00:08
  Speaker 1: Yeah.
• 1:00:09
  Speaker 6: He's all for central planning.
• 1:00:11
  Speaker 2: Yeah.
• 1:00:14
  Speaker 6: Yeah. No, it's, it's good.
• 1:00:16
  Speaker 1: Yeah.
• 1:00:17
  Speaker 6: I was, I was sampling your book as well and
• 1:00:20
  Speaker 6: I was enjoying it very much. So yeah, I, tells
• 1:00:23
  Speaker 6: an interesting story and i think those there's i mean
• 1:00:27
  Speaker 6: there are people out there like steven pinker who like
• 1:00:31
  Speaker 6: the backstop of their argument is like well things are
• 1:00:33
  Speaker 6: getting better so you shouldn't complain i think things are
• 1:00:36
  Speaker 6: always getting better so don't complain i think jordan peterson
• 1:00:39
  Speaker 6: has that too like some major components.
• 1:00:43
  Speaker 2: Just a massive non-sequitur you know you can't things are
• 1:00:46
  Speaker 2: getting better complain more make them more better like you
• 1:00:50
  Speaker 2: know what i mean i just think There's, you know,
• 1:00:54
  Speaker 2: it's fine for him to document some of the positive
• 1:00:57
  Speaker 2: consequences of the Enlightenment, and I would tend to agree.
• 1:00:59
  Speaker 2: But just like the idea that the sort of the
• 1:01:02
  Speaker 2: people who are critiquing are not optimistic, are against progress. No,
• 1:01:07
  Speaker 2: the people who are critiquing want better. They know we
• 1:01:10
  Speaker 2: can do better.
• 1:01:11
  Speaker 6: Want more.
• 1:01:11
  Speaker 2: Yeah.
• 1:01:12
  Speaker 1: Yeah.
• 1:01:13
  Speaker 2: Yeah.
• 1:01:14
  Speaker 6: It's like, oh, you have a democracy. You shouldn't complain. No, no,
• 1:01:17
  Speaker 6: that's what a democracy is for.
• 1:01:20
  Speaker 2: Exactly.
• 1:01:20
  Speaker 4: That sounds like a good place to cut it.
• 1:01:23
  Speaker 6: Yeah, thanks for joining us.
• 1:01:25
  Speaker 2: That was great.
• 1:01:25
  Speaker 4: Thanks so much for coming.
• 1:01:26
  Speaker 2: Yeah, definitely.
• 1:01:30
  Speaker 1: If you want analogies to understand the science, the positive
• 1:01:35
  Speaker 1: science of economics.
• 1:01:37
  Speaker 2: The dismal science.
• 1:01:37
  Speaker 4: We got some living under Mr.
• 1:01:39
  Speaker 1: Burns. Why is the whole economy just coffee shops? Easy
• 1:01:44
  Speaker 1: to digest titles from the Unlearning Economics YouTube channel. So
• 1:01:48
  Speaker 1: thank you very much.
• 1:01:49
  Speaker 6: And plenty of The Simpsons references, of course.
• 1:01:51
  Speaker 1: Plenty.
• 1:01:53
  Speaker 4: Awesome.
• 1:01:54
  Speaker 3: Awesome.
• 1:01:54
  Speaker 2: It was a pleasure.
• 1:01:55
  Speaker 3: All right.
• 1:01:56
  Speaker 2: Cheers.
• 1:01:56
  Speaker 4: Cheerio.