721. Is Capitalism Fair and Just?

Hello, everybody, and welcome to another episode of The Way the World Works. Today, I want to talk about capitalism, one of our favorite subjects, and if it's just, and if it's efficient, so two parts to it. And the reason I want to bring this up is because of a talk at the World Economic Forum that just happened a couple or a little bit ago, by the time this airs, it might be a few weeks ago, but happened recently.

And I want to preface this by saying, I know we did an episode where I was telling you that the World Economic Forum is basically a bunch of powerful elites who think that they know better than you, which is true. But why am I now telling you, let's dig into a speech that happened at the World Economic Forum because it was so great and so true? Well, because even though, yes, generally speaking, the entire World Economic Forum and

the people who go there and the people who are really into it are pretty terrible, they do think that they know better than you. But they have a variety of speakers, and some of those speakers are awesome. And one of those great speeches comes from the president of Argentina, whose name is Javier Mille. And Javier Mille is like, I don't think the kids say the bomb anymore.

I don't think kids have said the bomb since I was a kid, which was a long time ago. So we won't say he is the bomb. He is so cool. So Javier Mille is the closest thing we have to a president of a country who is free market, who believes in individual liberty, who believes in individualism, and he doesn't just say it.

He's not just somebody who says one thing and does another, like most politicians. He is the real deal. He is like if Ron Paul would have been elected back in the day and we would have gotten that. So Argentina is so lucky to have him. And he's funny because he kind of looks eccentric, his hair is a little bit wild, but it's really fun to hear him have a platform to speak about things that our listeners and the, you know,

the Tuttle twins, those people know, right, that we understand and we talk about, and that we're not used to seeing politicians agree with. So at the World Economic Forum, in the midst of all these terrible, terrible speeches and terrible people, he gets up and he gives a speech about not just how capitalism is efficient, but how it's actually just and actually fair. And you know, he's been pretty savage about socialism and communism, but it was really

interesting to me how he started this beach is he started by saying, listen, even people who hate capitalism, hate the free market, even those people usually don't complain about it being efficient. It is efficient. We all know that capitalism is the efficient way to run an economy. And I don't like saying run an economy because as we know capitalism is really not running

an economy or it's hands off. So, but everybody, everybody knows that it's very hard to look at different kinds of economies in the world and say, oh, the socialist one where they're hungry must be doing way better than the free market. So we know that, right? That's not what people complain about.

The people who don't like it, the these democratic socialists or whatever you want to call them, the people who want to be critical of the free market, always just try to say it's unfair. That's their reason, right? They'll say, well, sure, maybe it works, but people exploit their employees or it's not fair that people have to put in hard labor while, you know, a head honcho business man just gets to sit in his office all day and blah, blah.

And again, for many reasons, that's silly, right? Because it takes away the fact that the people who gave the money who took the risk to start the business and spend their day in their office had to do a lot of work to get there, right? And it had the skills to do what you need to do and was willing to put money on the line of risk it. So that is also just a silly argument, but more so, and this is what President Millet was

talking about. More so, it is the only, it is the only fair way to run an economy or if the only fair economic system, because it is the only one that lets people keep the fruit of their labors. And there's more to it than that, but we're going to dive into that now. So I want to start with a question that's if you build something with your own hands and your own time, who should get to keep that thing, okay?

Now, I want you to, because of course, our critical thinking minds are probably thinking, well, who gave the supplies? But let's talk about, let's talk about Legos. Let's talk about it in terms of Legos, who doesn't love Legos. So let's say that you used your allowance, you did your chores, whatever it is to get your allowance, or you save money, you mowed lawns, whatever it was, and you bought yourself Legos.

You bought them, you use your money, you bought these Legos. And then you build a really, really cool Lego spaceship, okay? And we've all built Lego spaceships before, right? We're still doing that. They're so fun. But your friend takes it away because your friends like, no, I like that.

I'm going to take that because we were playing together when we made it. And it's not fair. You have the Legos. It's not fair that you should get to keep the ship and then they take it away from you. Now, imagine that your mom comes in, that your mom would never say this because your mom knows socialism doesn't work, but let's just pretend that your mom comes in and sees

what's happening. And her response to this is, well, you know, it's more efficient and it's, it's, it's, it's more, it's not efficient. Sorry. It's, it's more fair and it's more just for everyone if we just share. So everyone should share.

So, you know, it's, you both can take turns. Maybe you can take it home for a week and then, you know, bring it back, you can do a schedule. What would you be thinking? I mean, unless that you really want you were okay with sharing and that's fine. But I know for me, if I had built something and I had not just built it, but I had paid for the supplies and I had put all my labor in into my, you know, getting these, these

Lego sets, which Legos are not cheap, by the way, I would be pretty mad if somebody else wanted to keep it. Let's compare this to something else. Let's talk about taxation, our favorite thing, right? If you work so hard and so long, like I'm sure all of your parents do and then you have to get a paycheck and see how much the government has taken out for itself because that's fair.

It's fair to help pay for public goods and, you know, public works, even though they're not good at taking care of the roads and they're not even good at knowing where to spend your money. But that's the fair thing to do because that's the way that we stay fair and just in a society. It doesn't fair feel, excuse me, it does not feel fair, just does it? Because just like the Lego spaceship that you paid for and you built, somebody is taking

what you poured your heart into, whether that was physical labor or, you know, monetary money, and they're taking it away from you because they're saying it's not fair that you should have something without sharing with other people. That's not fair, but in a socialist mind, that is fair. In a socialist mind, they think it's selfish and unfair for you to want to keep what you have or not even keep it.

It's fair for you to decide how to use it because there are a lot of people who give to charities or that do their own, you know, they give back, they want to volunteer. They want to give their money to causes they believe in, but they're told that they have to give their money to causes other people believe in, right, through taxation. So it's so silly because it really isn't about we think you should share your money with us. It's we think you should share your money with us in the way we think you should do it.

And so that turns into a big thing where some, for some reason, the socialists have have, you know, diluted themselves into thinking that they're the fair ones, that they're the kind of there, it's a benevolent ones because they know how to actually live in a just society where everybody is equal. But here's the spoiler alert, nobody's equal ever. That's never going to happen.

And that's a good thing. We're all equal in terms of the law. We should all be treated equally under the law. But if I work a different job than you do, we're not entitled to the same amount of money. And if I have more experience than you do, then we're not entitled to the same amount of money.

Just really bizarre to me that it's almost like we have different definitions of what it actually means to be just and to be fair. And this was the point President Millet was making, but he was also saying that really you can't be efficient. Remember we talked about how capitalism is the clear winner of being efficient, that in this terms, when you put it this way, you really can't be efficient without being fair.

They kind of go hand in hand, and I'm sure socialists listening to this speech was just like reeling, trying to figure out how this could possibly be. And I love that Millet just has this way. I couldn't understand the actual speech because it was in Spanish, so I had to do the translation. But he just says everything so matter of fact, and he's, he just, he doesn't apologize for his views.

I think he's just such an important man. So Millet is reasoning for saying that free markets capitalism, I use those interchangeably, that free market capitalism, we can use them all, is such a good, efficient and just system is because it is the only economic system. The only economic school of thought that respects every single person's rights. And by, by, by respecting everybody's rights, it works better, again, for everybody.

And so no other, no other economic thought, or school of thought can, can say that again, socialism can't, that's, they don't, they take away individualism, they take away property. So let's talk about why free markets do this, and they do it because free markets adhere to natural rights. And what do I mean by that? Free rights, you have a right to live, you have a right to life, right?

Everybody has a right to life, no one is allowed to hurt you or threaten you. That's not okay. You have a right to liberty, you have a right to live free, you have a like, right to choose what you want to do with your life. Unless that thing you want to do hurts somebody else, right? You can't say, well, I want the liberty to stab somebody, can't do it, I'm sorry, that's

not part of it. I want the liberty to hit somebody, nope, doesn't work like that. So the liberty to do what you want as long as that does not infringe on somebody else's right to life and liberty. And the big one, property, you have a right to your own property. What does that mean?

It's not just you have a right to your house, it's not just you have a right to your Lego spaceship, it's you have a right to the money you make by pouring in your labor into something and starting a business or whatever it is. You have the right to that, John Locke, who was kind of the father of natural rights, which sounds silly to say because natural rights are natural. It's not that anyone really discovered them, it is taking what is organic in human nature

and putting it on paper, but John Locke was one of the big guys for that. And he called it fruit, you know, have being able to keep the fruit of your labors. And I really like that analogy because I think of like building or building planting an apple tree. If you put all this work into, you know, gardening, I guess you would garden a tree, clearly I have a lot of gardening experience planting a tree and watching it grow and, you know, watering

it or taking care of it, whatever it is you do to a tree, you get to keep the apples from that tree. That is the literal fruits of your labor, but the same thing could be done with working when you work and you put time and what is time, time's actually money, right? Because you're spending all those hours making something or doing something of value. So you have the right to keep that money, but the socialists don't think so.

They think, no, actually you need to share that with everybody. But this system is great, right? Because this system has allowed me with my apple tree to go trade my apples for your oranges that were the fruits of your labor. And then we go and both of us sell what we have to somebody who doesn't own, you know, property with plants and trees and all that, who doesn't have access to that.

But they got their money by, you know, being a cobbler, cobbler's used to make shoes. I don't know why I'm speaking as if we're all living in some weird bit of ages, but you get the point, we're all trading, we're all taking the fruits of our labors and our skills and we're all trading with each other. That makes things efficient. By efficient, I mean, it runs smoothly.

Everybody's able to get what they don't have access to, like apples or oranges. And they're able to trade a skill to get the money to buy those apples and oranges. So it's this great, amazing, efficient system. It's so efficient because it is by nature just and fair because everyone gets to keep what's theirs, but then trade with others for what is the other person. It really is.

It's like a beautiful, it's silly to get so just excited about an economic system, but their free market is miraculous. It is wonderful. So to wrap it all up, what Miley was saying is because of this, you know, great efficient system where we're all trading with each other and everybody's getting what they need from that and maybe some make a little less, but they can improve their skills and make a little

more later. It's the system that's kind of organic and runs and everybody is helping each other, but not because they have to. They're helping each other because they're creating value that other people want and other people are willing to exchange money for and exchange goods for. But by being efficient, it's only allowed to be efficient.

The reason the free market works is because it is fair and just because it allows people to keep the fruits of their labor because it allows people to own property. It goes hand in hand. You kind of can't have just without having efficiency, right? And the free market is the whole package. But why I think this is so important and why I loved it is because, again, this is the

socialists will always try to say they have this moral high ground that they are the better ethical, moral people because they're willing to share and give up for other people. But a lot of those people are not the ones giving up. They expect everybody else to give up some of their money and they want to reap the benefits. That's not just. And not only that, it's not efficient.

And we know it's not because what happens, people go hungry. The people who are supposed to be ensuring that everyone is equal end up becoming corrupt and taking more for themselves in history has more than enough examples for this. So that being said, free market capitalism is both efficient. It is just it is fair. It is wonderful.

And I love that we have people like President Millet who's out here saying saying all this at a place like the world economic forum that does not value individualism does not value the free market. They value control. And so I just really love this. I would love to encourage you guys to watch the speech and maybe pause it and then have

some dialogue. The problem is again, it is in Spanish. And so unless your family is all studying Spanish, which would be awesome, you may not find that to be super easy. And watching with the subtitles was also just a little. Well, it didn't have the same that I wanted to have, but I read the transcript.

So that's also a good option for you guys to discuss. So we will leave it there. As always, don't forget to like and subscribe to the podcast. And until next time, I will talk to you later.