LearnLiberty Audio Podcast

There are difficult questions to answer: What is the weight-speed velocity of a swallow, anyway? Other questions are tricky, and the 'obvious answer' may not be the right one. In this video, Prof. Antony Davies presents some of those tricky economics questions many of us answer incorrectly. For example, did World War II end the Great Depression? Take Prof. Davies's econ pop-quiz and see how you fare. And be sure to subscribe if you want to learn more about these and other topics.

Did you know the war on drugs is founded on racist principles? Prof. Stephen Davies shows the historical thought process behind banning drugs. One of the main reasons drugs were banned initially is because people were concerned drug use would lead to interracial relationships. Can you imagine someone making that argument today? Yet it was a principle reason for some of the laws banning drugs that we still have. Other reasons for banning drugs included fear of conspiracies and the misguided notion that the government somehow has a right to the productivity of its citizens. All three of these reasons are truly absurd, but all three were historically used as arguments that contributed to the war on drugs. If these are the arguments on which the drug war is founded, can we be sure it's a war worth fighting for?

Have you ever thought much about property rights? Many believe ownership protections primarily favor the wealthy, but it turns out that the wealthy and politically connected actually benefit more when ownership is vulnerable. Without strong property rights, those with the power are able to take property from those who lack such political connections. In places like Zimbabwe-where the government is able to confiscate profits, merchandise, and even businesses with ease-the lack of property protections has been one cause of the country's decline. Today, Zimbabwe is the poorest country in the world, and eroded property rights are at least partially to blame. Prof. Dan Russell argues that 'doing less to protect ownership turns out to be a really effective way to create poverty.' Perhaps property rights deserve protecting. Except, maybe, among Finnish race car drivers.

What is the value of free will and the ability to make your own choices? Prof. James Otteson recalls a parable his teacher taught him in high school. If you had the ability to make a woman fall in love with you, would you like it? Would you prefer to force someone to love you or to have someone offer to give their love to you freely? Love freely given is so much more valuable. This story illustrates an important moral insight: Respecting people means allowing them to make their own choices, even if you believe the choices they will make are poor. Without the ability to choose for ourselves, we lose a bit of what makes us human. Do you find it frustrating when you are not allowed to make your own decisions? What would you do differently if people or government were not preventing your actions? Do you think you're better or worse when your choices are limited or taken from you?

Think you're too small to save the world-even one species at a time? Sometimes big change starts with thinking big and perhaps a little outside the box. Take it from enviropreneur Hank Fischer. Hank Fischer was concerned about the gray wolf. It was on the endangered species list and extinct in the American West. Efforts to reintroduce it in the region had been unsuccessful, largely because the local population didn't want hungry wolves killing their livestock. Rather than fight the ranchers in the region, Hank established a fund to compensate them for losses and give them incentives to support the growth of the wolf population. And it worked! Today, the gray wolf isn't even considered endangered. Hank's story is just one of many stories of enviropreneurs around the world. Laura Huggins of the Property and Environment Research Center (PERC) explains how thinking outside the box and innovating can work for the environment as it does for business. Enviropreneurs like Hank have been able to save species. Think about the difference you could make!

Literature and legend often reflect their culture. Some themes, like that of rulers imposing coercive power, or of individuals rising up against tyrants, are as relevant today as they were in antiquity. Suzanne Collins drew on Greek mythology's story of the Minotaur and on the legend of Spartacus in ancient Rome as she created the Hunger Games series. Her hero, like the heroes in these stories, does not seek her own power or profit but is standing up against a violent and tyrannical government. 'People everywhere yearn for the freedom to pursue their own goals and dreams,' says Prof. Amy Sturgis. Even though the themes are ancient, stories like the Hunger Games resonate with readers because the anxieties and fears they portray are real and relevant. 'These stories aren't just entertainment,' Sturgis says. 'They are reflections of who and what we are.' Do the themes in these stories resonate with you? Why?

The question of how to address poverty in the United States is complicated. Steven Horwitz, chair of the department of economics at St. Lawrence University, and Jeffrey Reiman, professor of philosophy and religion at American University, debate the level of government assistance that should be given to help the poor. In this clip, professors Horwitz and Reiman discuss how children who are poor can best be helped. While adult poverty may, in many cases, be due to some fault of the adult, should children have to suffer their parents' mistakes? Both argue in favor of improvements in the education system, especially in creating more choice. While Prof. Horwitz suggests this can be done outside of government, Prof. Reiman argues that government will still have to be involved, even if only to create the vouchers. Prof. Reiman also turns the question on its head, suggesting that perhaps the children of successful parents should not benefit from the parents' success any more than children of poor parents should not be punished for their parents' failings. Should all children start out on an equal footing, financially as well as educationally? What should be done to improve education opportunities for the poor? Is the government the best provider of education? What are your thoughts?

Everybody loves free speech, right? It's in the first amendment to the U.S. Constitution. But Prof. Deirdre McCloskey complicates the picture of free speech by associating it with the Greek word for persuasion: rhetoric. Free speech and advertising go hand in hand. Advertisements and rhetoric both have a negative connotation, but they are essential to the functioning of a free society. The only alternative to persuasion by speech is persuasion by violence. Clearly speech is a safer and superior alternative. And perhaps advertising plays a helpful role in society. What better way is there to make decisions about what to buy or what to believe except by people trying to charm us? What do you think about the role of advertising in a free society? Should advertising fall under the first amendment protections? How do you like to be persuaded about things?

What would happen if we didn't have a central bank? Prof. Lawrence H. White explains that private banks would be able to circulate money by issuing notes and checks redeemable for coin. Trustworthy banks would make arrangements to accept each other's notes and checks. Banks would have better incentives than the federal government to ensure their currency retained its value, because if it didn't, people would bank elsewhere. By contrast, central banks controlled by the government are able to devalue currency as they see fit and can even quit redeeming notes for coins of real value if they want to do so. It sounds like social-science fiction, but there are numerous real-world examples in history of successful free-banking systems. In fact, central banks arose largely because governments wanted an institution willing and able to lend them money with easy terms, not because of any problem with the free-banking system. Free markets offer the most efficient system for allocating goods and services, and money is no exception. As failures among central banking systems mount, it is time to reconsider the alternative of free banking.

Is it possible the war on drugs is to blame for increased potency in marijuana and for how crack ravaged inner cities in the 1980s? Prof. Adam Martin explains how the drug war has altered incentives for both drug buyers and sellers, leading them to favor higher potency drugs. This is what economists call the potency effect. As penalties for purchasing marijuana go up, for example, the cost difference between high- and low-potency marijuana decreases and people may think that if they're risking a fine or jail time anyway they may as well buy the stronger drugs. Similarly, cartels and dealers have shifted their focus to high-value, high-potency drugs like cocaine as a result of the steeper fines and penalties for drug trafficking. The potency effect is just one of many economic forces that make markets so complex. Public policies that alter the incentives people face-as the war on drugs does-can lead to unintended and even dangerous consequences. ►Source: https://www.ncjrs.gov/pdffiles1/ondcp/mpmp_report_104.pdf

Presumably you've already made plans for surviving a zombie apocalypse. You have detailed escape routes, stockpiled weapons made for killing zombies, stores of food . . . or at least plans for these things. But have you thought through the important economic factors that might make the difference between surviving and losing your brain to one of the walking dead? If uncertainty about how market prices and currency changes might affect your odds in a zombie-dominated society has been keeping you up at night, fear not. In this video, Prof. Antony Davies provides a crash course in how a zombie apocalypse is likely to affect the economy. Hint: sell your designer shoes now while you can. And buy bullets.

CORRECTION: At 0:16 in this video, Dr. Davies says 'In 1990, the United Nations set very ambitious Millennium Development Goals.' The Millennium Development Goals were set in the year 2000; several of these goals use 1990 as a starting point. Have you heard the news? The number of people living in abject poverty-defined as living on less than $1.25 per day-has been halved since 1990. How did that happen? Prof. Stephen Davies explains that extreme poverty has been on the decline in part because two of the world's most populous countries, China and India, have embarked on a path of economic liberalization and development over the past two to three decades. As more countries have embraced free trade and market-friendly policies, we have seen encouraging news of poverty reductions and greater access to clean drinking water. If such policies continue, Prof. Davies says, it's not out of the question for extreme poverty to be eradicated in the foreseeable future. These gains are likely to be lost, however, if we make poor economic decisions that take us back toward protectionism and economic controls. With good economic policies and free markets, we can help many of the poorest people in the world. ► Sources: 1.) The statement that the number of people living on less than $1.25/day was halved between 1990 and 2010 can be found on Page 4 of this report (not the PDF numbering): http://www.un.org/millenniumgoals/pdf/report-2013/mdg-report-2013-english.pdf 2.) Statement about # of those without access to clean drinking water being halved is found on Page 52 of the 2012 report: http://mdgs.un.org/unsd/mdg/Resources/Static/Products/Progress2012/English2012.pdf 3.) This statement, 'In India, in 1990, 51% of the population lived in absolute poverty. By 2015, the proportion will have fallen to 22%.': http://articles.timesofindia.indiatimes.com/2011-07-08/developmental-issues/29751472_1_extreme-poverty-india-and-china-report 4.) The statement about the percentage consuming less than $1 a day was 65% in 1981, and 10% in 2004. It's also cited that it is estimated that China's figures will drop from 65% to 4%: (Pages iii and iv of the World Bank report): http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2009/04/08/000334955_20090408062432/Rendered/PDF/473490SR0CN0P010Disclosed0041061091.pdf 5.) This data takes into account 'purchasing power parity.' The $1.25 a day is in 2005 dollars, and replaces the previously used measure $1.08 from 1993: http://mdgs.un.org/unsd/mdg/Metadata.aspx

When economic troubles strike, policymakers are eager to do something to try to help the citizenry. But Prof. Lawrence H. White argues that government doesn't necessarily know how to relieve economic woes, and in fact, often wastes and mismanages resources. Individuals in the market know better what they need in their circumstances, as economist Friedrich Hayek argued during the Great Depression. Relying on government to fix our economic woes instead of allowing individuals to make decisions for themselves means putting all of our eggs in one basket. Individual decisions in the market won't be mistake-free, but each individual mistake will be smaller and will correct more quickly. The unusually slow and painful recovery that we have seen in this recession point to problems with the 'government should do something' view. What do you think might be the best way to handle economic difficulties? Why?

As part of the government shutdown that started October 1, the National Parks Service has closed all U.S. national parks and monuments. Would-be visitors will be denied entry to Yosemite and Yellowstone and acres and acres of national park lands until the government resumes business. Economics professor Holly Fretwell suggests an alternative that would have enabled parks to stay open despite the government shutdown. She recommends leasing our national parks to entrepreneurs who would be responsible for managing the maintenance, campgrounds, trails, and infrastructure in the parks. The private management company would have to adhere to strict parameters, maintain low admission fees, and would pay the federal government for the right to lease the management of the parks. Under such a system, our national parks would generate income for the government instead of costing the government money to run. If this system were already in place, the parks could have stayed open during the shutdown. You may feel skeptical about a private business's ability to manage and maintain the beauty of our national parks, but private businesses currently manage thousands of public recreation areas and campgrounds and nearly half of all Forest Service campgrounds. Most campers who use these public lands don't even realize they are managed by private companies. Private management for our national parks would make them accessible to visitors even during the government shutdown, and could make our parks revenue generators for the government.

In 2011, fewer than half of all violent crimes found any resolution. An alarming 59 percent of rape cases and 36.2 percent of murders in the United States are never solved. Why are so many violent criminals walking free? Prof. Alex Kreit suggests that perhaps U.S. police forces have their priorities out of order. We would save $41.3 billion every year by ending the war on drugs. Prof. Kreit argues that those resources could be better used trying to solve violent crimes and prosecute criminals who leave victims in their wake. Millions of people who are under correctional supervision in the United States never restrained, assaulted, killed, or abused another person but are in prison for simple possession of a drug. Despite all of the money and time spent, it has never been easier to buy drugs. Portugal, which decriminalized all drugs for personal use 12 years ago, offers an alternative that is working. Drug use in Portugal has dropped, along with other measures, like the number of drug-related HIV cases and drug use among children. We should be directing more resources to investigating murders and rapes-not drug use. Whatever your stance on the legal status of drugs, shouldn't we make a guarantee to help victims first? Prof. Kreit asks, 'Who are the real victims of the government's war on drugs?'