On the latest edition of Being Libertarian Presents, Michael Brokamp interviews Thomas DiLorenzo, an economics professor at Loyola University in Maryland, renowned author, researcher at The Independent Institute, a senior member of the Ludwig Von Mises Institute, and much more. His newest book is “The Problem with Socialism.”
He believes something has changed with the cycle of a person’s political life, that school has ingrained the idea that socialism is good. This goes as far, DiLorenzo says, as getting participation trophies in sports at a young age, which pushes the idea that everyone wins.
Going way back in time, DiLorenzo notes that the pilgrims used agricultural socialism, which led to three quarters of the pilgrims dying of starvation. They then switched the system, which paved the way for, what DiLorenzo calls, “the American economy” of capitalism. DiLorenzo argues that the welfare state is a living example of the notion that “socialism makes everything worse.
DiLorenzo argues that capitalist nations actually harm the environment less than socialized nations, because capitalism involves “private property” which brings with it “liability,” so people do their best to not harm others, which applies also to pollution. He posits simply “wealthier is always healthier,” and notes poor countries like Venezuela that are highly polluted.
DiLorenzo hopes that millennials grow up and learn about capitalism, learning “economics, reading about the Austrian school,” so they don’t stay Democratic-Socialist. He believes young people just haven’t “taken the time to educate themselves,” and that’s what has led them to believe in people like Sanders and socialist ideas.
In terms of economics, DiLorenzo asserts that “prices are kind of like road signs in a city, and operating an economy without market prices is kind of like trying to navigate around a strange city without street signs. Without these prices, there’s no way of making rational economic calculations.” He cites Venezuela again as a result of this sort of attempt that ends in failure and ruins an economy.
In terms of the Federal Reserve, he calls it a “war on the elderly” because of artificial manipulation of interest rates. Since interest rates are being currently suppressed and have been low since 2008, DiLorenzo says that “there will be another crash” much alike the one back in 2008, because real estate developers are “being able to borrow at near zero percent interest rates and are building and building and building.” He then predicts a bailout again, and then for it to be blamed on capitalism by the left, and the cycle continues. In closing, he predicts the Fed’s next move, asserting that there’s a “snowball’s chance in hell” that Yellen raises interest rates before the November election.
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