Episode #338: Interview with John Tamny, When Politicians Panicked

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Before we get into how amazing this interview was, let’s learn a bit about more about John Tamny

John Tamny is Political Economy editor at Forbes, senior economic advisor to Toreador Research & Trading, and editor of RealClearMarkets.com (RCM). A spin-off of the policy website RealClearPolitics.com, RCM seeks to compile top-quality information and opinion about the stock markets and global economy.

Ron’s Questions: Segment One

Welcome to The Soul of Enterprise: Business in the Knowledge Economy, sponsored by Sage, transforming the way people think and work so that organizations can thrive. I’m Ron Baker, along with my good friend and VeraSage Institute colleague, Ed Kless, and on today's show, folks, we're talking with John Tammany, the author of When Politicians Panicked. Hey, Ed, how's it going?

Ed

Great Ron, looking forward to this show.

Ron

Me, too. Let's get John in here. I'm going to read his bio real quick. John Tamny is Political Economy editor at Forbes, editor of RealClearMarkets, VP at FreedomWorks’ Center for Economic Freedom, and libertarian star of RealClearMarkets, [and a senior economic adviser to Toreador Research and Trading (www.trtadvisors.com). His new book is When Politicians Panicked: The New Coronavirus, Expert Opinion, and a Tragic Lapse of Reason. Other books by Tamny include They're Both Wrong: A Policy Guide for America's Frustrated Independent Thinkers, The End of Work, about the exciting growth of jobs more and more of us love, Who Needs the Fed? and Popular Economics. John Tamny, welcome to The Soul of Enterprise.

I think we have a lot of mutual friends. We've had Jeffrey Tucker on. We've had George Gilder on three times. We've had Steven Landsberg, David Friedman, Mark Skousen. So we know a lot of people in common but, John, this this book of yours, When Politicians Panicked: The New Coronavirus, Expert Opinion, and a Tragic Lapse of Reason, this is a daring book. You essentially argue that we suffered not a medical crisis, but a political, economic and institutional crisis. How so?

You point out that even if the initial projections, like the Imperial College models, had been real, that the lockdown still wouldn't have been justified because you don't fight an illness with unemployment and bankruptcy and mass desperation. Why do you think people can't grasp that this is about tradeoffs?

It's a great point, I love that chapter. That thought experiment of this taking place back in 2000. And like you point out, for 63% of the workforce, work is a place, like it or not. And so are you saying, John, you don't say this directly in the book, but I get the sense, that this lockdown only happened because of our wealth.

Right now you say we ask too much of our experts, but we also rely on them too much. You continuously point out that our knowledge of COVID won't age well. Most of our medical knowledge has not aged well, if you look back through time. And then you make a really interesting point, or thought experiment: too bad Dr. Fauci wasn't a shill for Disney. Because if he was he would have paid for his mistakes.

I think you quote Jeffrey Tucker, or somebody, who says “The market pays for its mistakes, but politicians weaponize theirs.” And stupid should hurt, right? We analyze the market every single day with failure, and they pay for it. So it's a great point. The other thing that really blew my mind, John, from your book is you discuss a March 18, 2020 interview with FedEx founder and CEO, Fred Smith. Talk about that, because that was fascinating.

I love it. You pointed out that the old Soviet Union couldn't keep Chernobyl off the front pages. And that was back in the 1980s, when we didn't have the communication technology that we have now. And even the California Gold Rush in the 1800s brought folks from around the world. So word gets out and word certainly would have got out about that. Those are some great points. Well, John, unfortunately, we're up against our first break.

 

Ed’s Questions: Segment Two

Our guest today is John Tammany. His book is When Politicians Panicked: The New Coronavirus, Expert Opinion, and a Tragic Lapse of Reason. John, I just wanted to clarify something just because I want to I know what your position is, I think, and I want to articulate it. It's clear that Coronavirus was worse than the flu. It's pretty well documented that 10% to 13% of additional deaths, whether or not they were all attributed to the virus or not, I believe can be disputed. But there was something going on there. So you're not disputing this, you're not saying that taking precautions during a pandemic was unnecessary. But your subtle point is, you're saying that government telling us what those precautions were, when they should be in place, and for how long, was the problem. Did I state that well?

And the argument is, “But we had to protect them from themselves, John, don't you understand?”

I'm going to turn your attention a little bit to the beginning of the virus. We had Ronald Bailey on the show. And he shared with us that the Moderna company had taken the genome sequence that was sent to them by the Chinese on January 19 I believe it was, of 2020. And it had produced its vaccine and had the prototype in less than 48 hours, which leaves it at about January 21, of 2020. So before it even hit our radar, a vaccine had been developed. And the rest of the time was spent with delays in the approval process of the same government that shut us down. If there's anything about this that gets me violent, it's the fact that this vaccine was withheld from human beings for so long under the guise of we have to make sure it's safe for you.

Yes, and we can't know, you're certainly correct about that. But I think the thing that bothers me is the whole notion of even if you buy that the FDA should exist in the first place—and we've done shows with Mary Ruwart and we don't think it should exist—there's got to be a difference between approving a drug to reduce high blood pressure, which we all have because of this situation, and preventing you getting a disease and a vaccine, it’s a different framework, a different metaphor. Yes, you want to prove that it does what it says it's going to do, but a vaccine, once you prove that it's safe, you inject it into 1000 people, and if no one dies immediately, let it go. Let it out into the universe.

No, any company, once they establish themselves in the marketplace, like the idea of regulation? Facebook is all about regulation now. The last thing I want to talk to you about, and then I have some other questions on different subjects for the last segment. But are you concerned that politicians will panic again in the future, specifically over China, and maybe ask you this: Are they already?

Wow, all right. Well, hopefully, I'm going to take some breaths, turn it over to Ron, because we have to pay our bills, John, and I know you appreciate that.

Ron’s Questions: Segment Three

Welcome back, everybody. We're here with John Tamny, the author of When Politicians Panicked: The New Coronavirus, Expert Opinion, and a Tragic Lapse of Reason. John, one of the points you make beautifully in the book is that wealth creation has solved most of our medical issues, and you profile Rockefeller, Johns Hopkins, and you could go on and on with the Koch brothers, Sloan, etc. Talk about that, because I think that's a really important point that wealth is the ultimate get out of these crises.

You're so right about that. And the only known antidote to poverty is wealth creation. You also have another chapter, Chapter Five, where you say, “Don't insult recessions by referring to this as a recession.” Gene Epstein called this “The Great Suppression, which I've always loved. But then you argue in that chapter that recession is actually a sign of recovery. Explain that?

I love it. You say command and control actually asphyxiates an economy. There was no booms and busts in the Soviet Union, it's a great point. The other thing, talking about the bailouts, the PPP loans, all that junk that the government did with outrageous spending. You say—and this is pretty controversial, I think, to most people—far from being the engines of economic growth, small businesses and the jobs they create are most often a consequence of big business. Explain?

Absolutely right. You also talked about the GDP being double counting, which is why politicians love it, because of course it tracks consumption. But consumptions is the consequence of economic growth, not the cause of it. Again, why do so many people misunderstand this, even the popular press?

You just explained the supply-side mandate beautifully. I mean, consumption is the consequence of growth. And it's the easy part, like you say, production is harder. And I think it was George Gilder who wrote in his 1981 book, Wealth and Poverty. Even Marx understood this. After all, he didn't want to socialize the means of consumption [but rather the means of production].

John, are you worried about all the spending coming down the pike? I mean, not only what we spent last year, but what is being proposed for this year? It's in the trillions. It's unbelievable.

You make the point that if government allocates the capital, then the outrageous ideas are not going to get those dollars. And that's where you get the Peloton and our groceries delivered, and all those great things. And as [Jeff] Bezos said, “You know, I made billions of dollars of failures in Amazon.” Thank Heaven for those people,

Yes, the dynamism. You know, I think Gilder said the dog is the politician’s best friend. So knowledge is always about the past, but entrepreneurship is about the future. Well, John, this has just been great. Unfortunately, we're up against our next break.

Ed’s Questions: Segment Four

Author of When Politicians Panicked: The New Coronavirus, Expert Opinion, and a Tragic Lapse of Reason and They're Both Wrong: A Policy Guide for America's Frustrated Independent Thinkers is our guest today, John Tamny? John, I've got a question for you that's a little different angle, let's put it that way. George Gilder, who is a three-time guest of The Soul of Enterprise, wrote the Foreword to your book, so that's always appealing to us. But recently, you appeared on a video about six months ago for the Atlas Society. Ayn Rand used the occasion of her last public speech to take down George Gilder and his book, Wealth and Poverty. Square that up in your mind for me.

She really despised the concept that he said that profit is an index of our altruism.

I think Rand had a tendency to take words that had other definitions, define them the way she wanted to define them, and then eviscerate you if you didn't agree with her definition.

I agree. I think some of it is just the infighting among people who agree is sometimes worse than those outside of our thoughts. So along those lines, though, do you think we're in, as Ayn Rand would say, a sanction of the victim situation? Are we there right now?

She would say a sanction of the victim like that we because the question is, Why don’t we go to Galt’s Gulch? Why do you continue to write, why do Ron and I continue to do this show? Why, you know, shouldn't we just be going to Galt’s Gulch, because we're just feeding in to the very people who want to destroy us.

And let me beg your indulgence on a question that is, I think, a little bit negative. We have got about two minutes left. But I really wanted to ask you this. Why no inflation? Why haven't we seen inflation with all of the spending going on in Washington?

Fair enough. Great answer. We're already at the end of our show here. Ron, what do we have coming up next week?

Ron

We have Patrick Reasonover, the filmmaker of the documentary: “They say it can't be done.”

Ed

Well, I look forward to that. I'll see you in 167 hours.