well look at the lesson we can learn from the flintstones and the jetsons also this week two u.s. regulatory rulings came down eighteen t. forbidding a merger with t. mobile and another saying a feature of google's droid two closely resembles the i phone or bureaucrats those standing in the way of desires of cellphone users everywhere doing you dropped calls targeting your well being well jeffrey tucker our guest will make the case and the richest lottery in the world known as the fact one pays out to nearly two thousand spaniards in a small town in spain reportedly is the fat one the last hope for people in a cash strapped eurozone country where hey a former lehman exec has been tapped to run the economy and oversee austerity we'll talk about it let's get to today's capital account.

all right in a slew of bad us economic news which has really become the new norm it's worth stepping back and looking at how and why we've gotten here in the first place first let me recap you have the u.s. g.d.p. revised down to one point eight percent we learned that today also jobless claims they went down but does this just mean u.s. businesses increasingly have fewer temporary workers left to fire their heads pointed out one out we liked it speaking of g.d.p. maybe growing a little but the debt is growing faster and fitch the ratings agency has come out saying the u.s. is depor isn't the behavior of a aaa rated nation but c'mon yeah yeah we have heard that all before. we see you know the debt to g.d.p. ratio continuing to rise over the forecast horizon and putting it in a position where it would no longer be compatible with many other aaa ratings. meanwhile it is back and forth on capitol hill over the payroll tax cut extension

this is really an extension of the same partisan bickering in washington gridlock that we've really come to expect in the u.s. so back to that question of how did we get here and what's keeping the u.s. economy from moving ahead versus what's stopping it what if we look at it from this perspective. so you're thinking about leverage george it's going to be kind of long should the romney where you were got a little expand. your it did everything including getting those flu to sharia couldn't help your problems get your jobs back but i got to get home and see if i could save my own all right so what if we think of the private sector as the jetsons where innovation comes from and the flintstones as the government trying to keep us in the stone age all right let's keep this going let's flesh this out i want to bring in our guest jeffrey tucker he's executive editor of life is a fair books and author of many of them including it's a jetson's world private miracles and public crime so first of all it's so nice to

have you on the show mr tucker because our producer dimitri affinis and i were watching some your lectures last night reading some your writings and not only were we so impressed by this discovery of you as our guest but also we were rolling pretty much off of our chairs laughing so let's kind of start with a major theme of your lectures and your writings which is this is the private sector and individuals who really create the innovation that creates the wealth in society contributing to our prosperity while the government often stands in the way of progress that's a major theme but give us really a relatable example that you think really highlights this. well we live these examples every day we wake up in the morning and we see what's new on the internet and who creates all this new content who creates the new roll out of the software we'd love to use who makes the the applications that we download when we find on our i phones that there's a new a new version that we have to download these are human beings and they're interacting with each other to the mutual self benefit using their own creative

power to offer wonderful services to other human beings sometimes for free sometimes for profit whatever the case might be these are individual human beings interacting with each other collaborating sharing doing wonderful things or using their own creativity their own minds to serve humanity and that's the essence of the market we talk about the market it's not a machine it's flesh and blood it's people doing wonderful things for each other that's the essence of the free market so what does government it's it is like to play and sounds in a way i mean but but that's an f.x. not a not a cause the cause is the government is based not on collaboration but on coercion that's based on aggression on taking of property rights and on telling people what to do that's the opposite of creativity the opposite of collaboration and the opposite of human progress so one way to look at history is a huge. kind of contest between these two forces

a human creativity on one hand and collaboration on the other hand coercion and government power mongering so that's why i think what we have work right now in the american economy is to seen this great struggle between these two here that so you see a correlation between regulations are really the lack there of and kind of this advancement that we've seen in attacking internet based over the last three decades no it's absolutely related i mean it's precisely because it's a it's of a free market and the digital world that we've seen such a stunning innovation free to apply the same model to the physical world and see the same innovation and education and health and care. and and all the other sectors of life that the government so rules so much with an iron hand i mean this is what this is why we will look forward every six months to the great new roll out of allergies it would be this way in the physical world too but we've gotten used to this kind of slog a boggy world that the government runs and you know look we're looking at one percent growth rates this is crazy you know you mention the wild west one of the

wild less west lead to lead to the gilded age which was as far as we know the period of history that had the largest amount of economic growth in the history of the world by far by far lifespans increased income increase of population exploded the middle class became reemerged and so on became enormous about that this is what the wild west led to the guilt of it was so we going to growth rates for ten week in every major attacker that we can we can agree that in some cases regulations are burdensome but certainly there are some cases where a deregulation correlates with recklessness and fraud like we've seen for example on wall street with big banks right right well and i would i would recognize that but point to a more fundamental problem namely the monetary unit as unsound were doing and the world right now where the government has destroyed the quality of money and so if you deregulate in that environment and you have the printing presses running at the

federal reserve and. and regulatory agencies not doing their job then of course you're going to have this kind of bubbles and booms and busts but that it's a slightly different problem economic be cured through sound reform towards a sound money which is a necessary corollary to the free market if you had a free market you would have sound money and in fact the internet keeps trying to invent new forms of money and guess is guess who keeps stopping that. keep showing up we're going to a no no money other than government money out well ok then slightly different from that example what about for example we see this oil spill that they're grappling with now in nigeria which is the largest one since the exxon mobil. bill twenty thousand barrels have spilled out this is shell the company i mean certainly in this situation you have a society that eats up the costs of this kind of environmental damage and that's not how a free market supposed to work society isn't supposed to bear the burden of that cost the producer is that's right i can't disagree with you there and if we had

decent liability laws so the property owners themselves had to pay the costs of any mistakes that make would have this kind of problems a lot of the choices about drilling and where we drill are influenced by government regulations themselves i mean this is why people are drilling in the deep seas were technology makes it extremely difficult because of all the restrictions on the drilling closer to closer to land but you're certainly right about lyla liability laws that's also part of a free market economy and if you indians are allowed to interact naturally and normally with each other they come up with solutions to things that don't impose the cost on society but rather keep the cost focused on those who should bear them namely the property owners themselves so the free markets property rights how money they all go together and they are all constantly under attack by a government central central planning and let's call it what it is i mean in the united states we have a kind of central plan very much analogous to what used to be very common in the. soviet union and many other socialist countries i mean it's a kind of

a goofy bureaucracy that doesn't have any stake and the outcomes of what goes on and the market they just the there to be a big pain in the neck for everybody and you know i mean you mentioned the payroll tax debate this is a good example of this well you know mr tucker i want to get to both liabilities and paying them i know you actually paid some liabilities you spent some time in jail you think it's a lesson everybody should learn so i want to talk about that when we get back from break but first we've got to go to some else real quickly and we'll have more with that jeffrey tucker who is an author. all right it's time now for word of the day why break down a financial term or concept for our very smart viewer but just maybe not the financial expert and word of the day today is the term it's volcker rule and given

that we're talking about regulations this is one that's in the news today because this a bipartisan group of one hundred twenty one u.s. house lawmakers asked federal regulators to slow the adoption of the so-called volcker rule that aims to ban banks from proprietary trading so this is supposed to be a step towards reducing risky trading on wall street it's required as part of the two thousand and ten dog frank financial regulation so here is exactly what it entails if we want to look at a definition so it's trading restrictions placed on financial institutions the volcker rule separates investment banking private equity and proprietary trading or hedge fund sections of financial institutions from their consumer lending arm so the rule would prohibit banks for the most part from investing in had funds and private equity funds it would also ban proprietary trading which is where banks trade to make money for themselves as opposed to making money for their clients now the volcker rule is really dogged craig's answer to glass steagall type separation

of retail banking from investment banking like you see here with this great example of what that would look like in the case of j.p. morgan chase ok they are separate glass steagall came about after the depression and was repealed during the clinton administration now as for the volcker rule the framework came in october and several agencies have to vote on it and of course now we're seeing calls for delays now there are some exceptions to the rule too so it's pretty unclear how this would work out in implementation now on wall street. banks like goldman sachs j.p. morgan chase morgan stanley are against it because it eats into their profits and consequently it was one of the most intensely lobbied parts of dogs frank and now that it's going through this whole regulatory phase the trade industry's behind the banks have been lobbying regulators to extend the comment period along with some lawmakers like we see now now it's supposed to go into effect in july two thousand

and twelve so we shall see but now you basically know what the volcker rule is and a little bit of trivia it's named after paul volcker who is behind it he's a former federal reserve chairman he has championed this and incidentally he does need for an interview once on the grounds that he was too tall and i was too small which is a great story to leave you on before we go to break still ahead can you hear me now good no thanks to government regulations that will tell you why and first your closing market numbers. we just put a picture of me when i was like nine years old until she told the truth.

i have a confession i am a total ghetto princess i love grabbing hip hop is excellent and pretty sure. i do it's kind of the gesture that. i'm very proud of the role that you just played. you know sometimes you see the story and. thank you understand it and then something else. and realize everything. i'm charged welcome is a big issue. what drives the world the fear mongering used by politicians who makes decisions to

break through. who can you trust no one. with a global missionary zeal where we had a state controlled capitalism is called sessions when nobody dares to ask why we do our t.v. question more. welcome back before the break we were talking about if technology is the one area where opportunity for innovation still exists because government regulations have not caught up but are we seeing it being stifled with the consumer suffering as a result so the stop online piracy act which some argue is really to stop internet freedom act is one example we love our cell phones too so let's look at that the

u.s. handed down two regulatory rulings this week and one it forbids the merger of eighteen t. with t. mobile one targets a feature of google's android phone on the grounds that it too closely resembles the i phone i want to bring back in jeffrey tucker author and executive editor of lies a fair books because he argues that neither of these rulings neither of these regulatory does it decisions will help you and that both are actually harmful to the cause of competition we're going to hear why but first we're going to hear why you were in jail now we were talking before the break about liabilities and people being responsible producers being responsible i would bet that we will never see jamie diamond for example behind bars but you consequently have been behind bars you write about in your book for rolling through a stop sign but what was so powerful about your experience that you feel like everybody should experience this one oh well you're right that a well i would wish this on anybody but it changed many things for me because i really. have a lot of street credibility as

a result of this experience i would never go as i stood there in jail with my fellow inmates i thought well i'm going to get a good article about this anyway but you do have some they have a sense almost metaphysical transformation that overcomes you realize that nobody who values you can control any aspect of your life and the people who do control you don't care anything about you you know you were and would just look look look through you're like you're just this bag of flush you know no value whatsoever i mean even animals in a zoo have more value than a prisoner and after i got. a prism. i was it was really jail like a. a better word for it but anyway i began to look into this whole subject of jails and prisons and america and i was astonished to discover that the united states has the world's largest prison population you know. it's a gigantic problem in the us we jail people for the most posterous reasons and we just throw them throw them in there and forget it forget about them it's sort of part and parcel of the whole problem of the u.s. becoming a kind of police state really and there's

a question of how politicians and how the state he gets at the already who benefits from it and i want to play you a clip of what hugh hendry a hedge fund manager was saying about champagne socialists who benefit i want to play that for you. he should be avoid the champagne socialists when i travel business class i meet these guys i meet the socialists the social sitrep of business and first class through the prosperity of created by entrepreneurs and risk takers like me and the people that i represent know we're so would you agree what do you think about that that entrepreneurs risk takers they're the ones that create the wealth that then allow for politicians to cash in right first class alongside them you know chris that's right i mean the politicians what do they create to create absolutely nothing and it's something like a disgrace really to see these these old gazers you know on capitol hill voting on legislation like the sopa the stop online privacy act which would really transform

the internet as we know it i'm realizing the more i look into this we really have two visions of the internet at work here one is a collaborative tool for all of humanity to get together and become greater than the sum of its parts and do miraculous things every day on one hand and the other hand you've got the soap advocates who are working with the politicians or just trying to turn the internet into just kind of a big condominium unit with a bunch of separate rooms and where they're nobody's talking nobody's collaborating nobody's linking with each other it would be catastrophic and and change the way the way digital media serves us every day and this is a very very serious thing i mean it sort of emerged out of the blue is like we weren't really paying attention and suddenly there's a legislation in congress that would shut down and shut down everything we love about the internet and i hear what you're saying about what it would do to consumers i'm curious what you think it would do to free enterprise honest internet which we've been talking about has had so much innovation. as well. and essential

part of free and there are three essential parts of free enterprise one is cooperating with each other trade one is competing with each other but of but a third thing that's extremely important is learning from each other that's also part competitive of the. enterprise process so that when you see something successful taking place in a market that's a kind of a public good information that shared with the with the world look here's something successful and wonderful people are free to go in and copy it or emulate that and so if i donut shop in auburn alabama somebody else is free to do the same thing and compete with me it's the same way that it should be and cell phone industry too and this is what makes this decision with it with google and and apple so deadly because clearly the google phone phone learn from some of the successes of apple just as apple learned from the success of others i mean to technology as a kind of continuum of learning throughout all time it began and you know but at

the beginning of time it is and will continue to the end of time and so where you have these kind of decisions that favored apple over google as a government just kind of interrupting their process and forcibly preventing people from from learning from each other in the service of humanity really and i know you bring us up with that with the google droid case of the apple patent but i'm curious if shouldn't there be some kind of intellectual property even in short term because should there be some incentive for us they are young entrepreneur are who wants to build something similar actual property to do so with you know out the threat of it just being ripped off no i don't believe in intellectual property and you know the whole idea of intellectual property became only internationally effective sometimes but the latter part of the nineteenth century was a gigantic error and the reason for that is that ideas are really infinite goods if they're made public that they are necessarily public and available to everybody

just as my and this is doesn't amount to stealing because the original holder of the idea continues to hold the idea because ideas are infinitely replicable infinitely reproduceable things and that's what makes the world run and that's what makes progress really pop. civil so no i don't believe in this very i think very mistaken notion of intellectual property but even if you do. you have to understand that kind of consistent and aggressive enforcement of this could really shut down civilization as we know it so there were none of nobody's from that permitted to learn from each other or at the very least it's going to slow down progress to the point that we all have big leaps and jumps and ovation every say you know seven years or every twenty years or whatever it's going to be according to what the central planners say and this say but there is the problem of say you know an anecdote that one of our producers shared which you know when he would walk in to raise money for for adventure you know what would stop

a head from from saying ok yeah i like this kid's idea but i have someone who can execute it way better that remains kind of a question for me but i do want to move on because i want to ask if we take for granted all of this innovation i want to play a quick clip of a comedian talking about when he got internet on the plane and then i want to ask you a question about it let's roll that. and look at a you tube well we're flying and then it broke down and the woman says i'm sorry but we have to fix the internet so it's down for the rest of flight going next meal's it's. like dude how does the world hold you something you even know existed thirty seconds ago. the even guys complaining on the plane because the internet went out on you know i minute ago we didn't even know the internet existed on a plane so do we take this all for granted as consumers we are all this way i don't know if it's something about the way we're built as human beings or something but if somebody came up to you and said we're going to roll back from the four g. to the three g. you know or to the initial releases i floundered scream and say well you know

that's just catastrophic we don't know what it is but we take this material blessings for granted i mean it's like we get this manna from heaven and then we know he's right we all consumer consider our human right what i try to do in the book is that try to make you feel like you shouldn't be sort of sort of grovelling always in front of entrepreneurs or give us these great things but rather just so that you're conscious of the sort of i mean what gives us these blessings were the man i comes from is really the market economy and that's the thing that we need to praise appreciate defend and protect against the looter classes and the political world so that we can continue to have have progress big letters can we talk about monopolies for a second because before we go i do want to bring up that eighteen thousand nine hundred mobile thing because people that say this was a good thing that this merger would block argue that if it went into effect you would have two companies that control seventy five percent of the market you'd have a twenty and horizon but you actually argue that blocking it is anti-competitive so

how does that work yeah well if he and he is having trouble and the merger of two mobile would have been very good for its for its bottom line over the long term just because two companies control and seventy five percent of the market there's nothing in the natural law that says how many companies should control market by the. i think control of the wrong word word i mean in the free market the only way corporations make money is by serving serving others so if it's just one company serving one hundred percent of the market that's fine as long as there are no barriers to entry and by the way i think that the reason the whole merger was blocked actually had something to do with the companies that were financing the exchange goldman sachs was was very much against this this merger because. he was using j.p. morgan has as its financing agent if you look very carefully at all you know art and blacks than it seems but looking back to the robber baron era with standard oil and even more modern times at microsoft and with google arguably controlling so

much with their control their dominant position in search technology should there be some kind of rules or some kind of way to stop monopolies can't we agree that those aren't a good thing so the best way to stop a monopoly is to stop using the company that's going the monoblock going to really stop using google group collapse that would happen very quickly the same as when belzer got a business if anybody everybody stopped buying their hamburger so in other words we vote every day with our dollars with our with our search patterns and we're on the position of making decisions about the winners and losers marketplace either we are going to make those decisions you and me and everybody else all seven billion other people or the one percent. the one percent i mean of course the political class they're going to make the decisions for us and i just prefer a world in which the citizens of the world actually rule who the winners and losers are that's all because i think government yeah it's a great point that you bring up and i so appreciate you bringing up so many great points on our show is a real pleasure talking to you that was geoffrey tucker he is author as well as

editor of lies a fair books and that is actually all we have time for that's it for our show we flew through it but please feel free to follow me on twitter at lauren this year until we have another go for you tomorrow also go to our you tube site you tube dot . flash capital account you can see any of the episodes or words of the day that you missed you can also give us feedback because you know what to morrow is it is friday and that means we are going to be responding to your comments and questions and i am more in leicester as you know it from everyone here at capital account until next time thank you for watching and have a great night. wealthy british soil the sun. is not on the telephone.

market why not. come to. find out what's really happening to the global economy with much stronger for a no holds barred look at the global financial headlines tune into cars a report on our. download the official altie obligation to go on the phone on called touch from the choose ups to. lunch on life on the go. video on demand maltese mine gold coast's and already says feeds now in the palm of your. question on the dot com you know how sometimes you see a story and it seems so you think you understand it and then you glimpse something else you hear or see some other part of it and realize that everything you thought

you knew you don't know i'm tom harpur welcome to the big picture. admission is free. education free in-store charge free arrangement free. three stooges free. downloads free broadcast clothing videos for your media projects a free video dog r t dot com. one of the most extraordinary chapters in the history of the american military will come to want to. well that's one way to put it but i have a feeling iraqi citizens of

politicians agree. to come home feeling terrible despicable about what we did and what you saw and as u.s. troops come marching home from iraq many are fighting for their lives and once again well tell you why more american soldiers are taking their own lives.