← THE Bitcoin Podcast
Loading summary
Transcript53 lines
- [00:00]
Josh Hendrickson
The people who want to be left alone will always be defeated by the people who refuse to leave them alone. All of a sudden, you wake up one day and you've made, like, 30 concessions, and now things are really, really bad. I'm sorry, but, like, I'm not willing to go through that. I know how this ends. I know it doesn't work. It looks like South Korea is an island off the coast of China because North Korea has no lights. They have no lights because they're poor. They are poor because they are a communist country. Socialism and communism are the politics of resentment. They just are. They're always coming from a place of punishing successful people.
- [00:31]
Walker America
You're advocating for an ideology that has killed at least 100 million people in the last century.
- [00:37]
Josh Hendrickson
When you start digging into bitcoin, you don't just learn about bitcoin. You learn about lots of these peripheral things that you need to understand. It forces you to dig in on all these fundamental issues about money, about savings, about privacy, about all kinds of things that, like, we don't even think about because we've all just kind of grown up in the current system. We haven't exercised the muscle of what it means to be an American for a long time. I hear people all the time talking about escape plan. Well, if things go bad, I'm going to do this. There's nowhere to go. And also, why should I go? This is my home. This is where I'm from.
- [01:20]
Walker America
How was the conference overall? This is the first year in a few. We haven't been able to make it. Obviously, we're not doing any traveling for the foreseeable future because of Carla. But how were the vibes?
- [01:33]
Josh Hendrickson
I thought overall the vibes were good. I think early on people were kind of, I think, concerned just because normally there's a narrative every year, and there didn't really seem to be a particular narrative that was, like, dominating there also didn't, you know, like, normally there's like a kind of. Like a particular. Well, kind of. You know, the conference has kind of been taken over by politics, right? So the last couple of years, you know, there's like J.D. vance and Trump and stuff like that. So you. You. You had like some big thing. You felt like everything. Everything was like, building up to. Because there was some big guest that was going to be there and. And this was more normal bitcoin conference kind of thing. So there wasn't like that big, like, centralizing event or something like that. But, I mean, tons of people there, they put on a great Conference, like, it comes together pretty incredibly, especially because most of the people who are working on it are like, incredibly young. And a lot of them, this is like their first experience putting on something like that. So. But it was, I thought it was great. I thought, you know, the vibes were high. All the vibes capital people were, were around and, you know, they were, they were bringing up the vibes.
- [02:53]
Walker America
So I, I, I love it. Yeah, it's, it is interesting. You know, I think in terms of the, let's say, the politicization of bitcoin because, like, bitcoin as money, I think, is inherently political. I think money is inherently political. I don't think that money is partisan or that bitcoin is partisan. Some may try to paint it with that brush, whether for or against. Right. Whether it's the, you know, one administration trying to say, look how pro bitcoin we are, or Elizabeth Warren screeching about how, you know, bitcoins, bitcoin's, you know, destroying the planet or whatever it might be. But it is, it's almost like that part of things happened, really. It was, I guess it was gradually. Then suddenly like it felt like it was kind of like a side note or it was being ignored. And then all of a sudden it was like front and center. And there's not really any going back from that. But I guess that's also, I don't know your thoughts on it. I view it as a symptom of bitcoin's success. Like that was always going to be what would happen if bitcoin was successful, which bitcoin is like, if bitcoin was winning, this is what you would see, this is what you would expect to see in such a world. I don't know your thoughts on it because a lot of people obviously, you know, re reject any of the political even attention on it and say, like, you know, this isn't what bitcoin's about. Da, da da. And in my perspective, it's like, okay, yeah, I agree. Like, that's not very cypherpunk. But it also doesn't matter what you want because it's just a reality. Right? That's just, this is what it was going to look like. But I'd love to hear your thoughts on it.
- [04:29]
Josh Hendrickson
No, I kind of wonder like a lot of times, like, what's going on. Because on the one hand, you know, I like to joke about the people who just like, throw a fit because, you know, some politician wants to come talk at the bitcoin conference and they're like, this is not, you know, what bitcoin was designed to be. And kind of the thing I laugh about is I always think, like, aren't you the same person who's like, talking about, like, hyper bitcoinization, like, all over the world? Like, I don't know if you know this, but there are lots and lots of people who use dollars that you don't personally like. And. And so if bitcoin is going to be, you know, a dominant currency, right? If it's going to be something that people are using in their everyday lives, people you don't like are going to be using it and talking about it and have their own opinions on it. But I do kind of wonder, like, where the sentiment comes from. And I think it probably is just that we got here way faster than anybody thought possible. So there was always. There were always people saying, oh, well, you know, eventually the United States government will be telling you to buy bitcoin, right? And people would laugh at them, but they would say, like, wow, you know, I mean, I don't mean next year. I mean, you know, some point in the future, and I don't know how far in the future they thought they were thinking, you know, they were thinking about, but maybe it was 25 years, 50 years, 100 years, I don't know. But it certainly wasn't like two or three years. And so I think that the speed with which this became, you know, salient with politicians and things like that, I think came way faster than people realized. And I think that might actually be the concern that people are voicing when they make these complaints, is they sort of thought it would take longer. And also it's much easier to think about, like, these hypothetical politicians in the future that are going to tell you something positive about bitcoin than it is. Like the guy you just saw on television last week who you may or may not like that, you know, I think that changes the perspective because in your head you're thinking, hey, like, you know, 25 years ago, some politician I really like is going to come on television and talk really nicely about this. And then when it turns out to not play out that way, I think maybe that's. That's a little hard for people. But I mean, like, look, there is this inherent tension here in the sense that sort of like that. That sort of cypherpunk, you know, that cypherpunk core, right, that this all grew out of. I totally understand, like, the idea that you want to kind of hang on to that and that that's kind of important. But I also think that, um, that's a completely unrealistic idea. Like it was never. The only way it was going to be that way is if it wasn't particularly successful. Right. If it was just kind of this niche thing that only a few people cared about, like, yeah, you could really maintain that. And I'm not saying that you as an individual should say, ah, well, that sort of lost and we can't be like that. No, no, no. Like you should represent your opinion in the same way that everybody else is representing their opinion and you know, you should try to move things in that direction. But I mean, honestly, what we need to bring back is more of the we, we. We need to bring back all of the memes from the old days, which is just, you know, bitcoin doesn't care. Right. Like when, you know, and, and use them back on the same people who were throwing them at other people back then. Right. Is, you know, we need to bring that back. Bitcoin doesn't care. It's, you know, doesn't exist for you specifically. Right. And I think that in a lot of ways it's kind of like the person who had like a favorite band before everybody knew about the band. And I think that's kind of the same sentiment is it's hard to accept that now this thing that you thought was kind of your thing is now, you know, lots of people's thing and maybe they don't appreciate it as much as you do or maybe they weren't there in the early days, but that's how it works.
- [08:52]
Walker America
I think also there's. Because I agree with you that I very much understand the sentiment of like, okay, would it be ideal to not have a bunch of slimy politicians riding on the coattails of bitcoin? Sure. But you can't, like that's the whole point of bitcoin is you can't stop anyone from using it or trying to associate with it. Affinity scams with bitcoin have been going on forever for a long time, will go on for a long time in various, you know, methods. But I think also that perhaps the political attention on bitcoin in some ways can provide some additional cover for the cypherpunk core which is still so vital. Like you still need the anonymous open source freedom tech developers building the incredible stuff that is going to enable all of us to actually live and thrive in a more sovereign way in a hyper bitcoinized future. At the same time, I think perhaps, you know, it's. It's almost more helpful than people realize to have some of the political attention on it because that creates a different kind of attention. It's a different kind of conversation. And if you can, you know, like, very much, yes, like, the system will not change itself from within, but it can be nudged in the right direction. Right. And I think having, like, what I've said often to, to Zach from BPI is that, you know, I'd rather have a Senate full of Lummuses than Warrens. Right. I like just. And I think anyone, any reasonable person would. Right. You'd rather have the current administration, the current U.S. government administration stance on bitcoin than you would like to have China's stance, let's say. Like, I personally, I would prefer that. I'm not going to prefer a more oppressive government, a more bitcoin unfriendly government, simply because it gives me something to fight against. You can continue. Like, just because the state is speaking in favorable terms about bitcoin doesn't mean bitcoin has been subsumed by the state. It's like to talk about other old memes, you know, you don't change bitcoin. Bitcoin changes you. I think that is also true of government. That doesn't mean we shouldn't remain vigilant. We absolutely should. But there are, there are actual, there are potential benefits to bitcoin getting positive attention from the government. Not again, like the Lummis kind of attention, not the Warren kind of attention. And I think you get, this is what I really like initially when I heard about bpi, and I should mention you are a, a senior fellow, right? Is that the correct.
- [11:23]
Josh Hendrickson
Yeah.
- [11:24]
Walker America
And also you're a professor and chair of the Department of Economics at University of Mississippi and probably have a nice long resume to go along with that. We can, we can get into that a bit as well. Just to talk about the academia side of things, because I do. You are rebel econ. Prof. After all. But when I initially heard about bpi, it was kind of like maybe my gut reaction was, well, you know, I don't know if we should be trying to, you know, why are we even bothering with these politicians?
- [11:50]
Podcast Host
Right.
- [11:50]
Walker America
You know, why are we even doing that? And then I thought about it for more than like two seconds and I thought, oh, well, actually that's, that's quite, that's quite good. Now you have people in congressional hearings that are speaking about bitcoin positively. You've got, you've got, you know, generals speaking about how, hey, we're running a node like that was a crazy, crazy or a crazy hearing there. Instead of just having Elizabeth Warren asking like softball questions to Jamie Dimon about how bitcoin's only used by criminals. You know, it's like, which one would you rather have? I'd rather have the four star generals talking about how bitcoin is important for national security than have Elizabeth Warren basically like having a, having a massage with Jamie Dimon there. That, but that I like, that's just me. Maybe I'm off base. I don't know.
- [12:37]
Josh Hendrickson
Well, there's a big picture thing and a small picture thing, I think. So the first thing is, is I think that for most of us, for most of our. Well, I don't know, maybe it depends on the age of the audience here. But I would say, like, for most of my life, politics was kind of fake, right? Like, for most of my life, politics, you know, the parties weren't all that different, right? They had, they had particular emphases, I guess, that were relatively different. But like, sort of politics was. Politics was sort of fake, but everything else was kind of real, right. And I think that we've kind of transitioned in this period where like, everything is fake, but politics have become real. And I think that politics, like the stakes in our politics are actually real. Again, if you listen to how our politicians talk, they very much talk in a sort of existential threat of their opponent. That's very, very different. I mean, rhetoric wise, maybe not, but in terms of now, it seems much more like they believe it, right? Whereas maybe you would say this about your political opponent because it helps you in a campaign commercial. I mean, now they seem to mean. And then as related to that is that you don't have to care about politics, but politics is going to care about you. And when politics becomes real, you have no choice but to engage. Because if you're the person who's not going to engage, then that means you're just going to be the loser of this process, right? Like that you, the person who just wants to sit in the comfortable middle ground, is just going to get run over. And so when politics get real, like, you actually have to take a side and you have to actually take a stand on things. And especially when people talk about it in terms of this existential language. And so when the politicians show up and they want to talk about Bitcoin, like, wouldn't it be much better to have people who can talk from a position of being well educated in the technology or in the economics or in, you know, or in terms of like how the mining works and all of these kinds of things. Like, you want people who are. You want people in that room who can bring, you know, common sense and truth to the conversation and who are going to advocate on your behalf. And you, you know, you might not care about it, but once they're interested in it, you need to care about it. Because how this plays out is going to depend on who's in that room.
- [15:17]
Podcast Host
Wish you could access cash without selling your Bitcoin? Leden makes that possible. The global leader in Bitcoin backed lending, LEDN has issued over $10 billion in loans since 2018 and has a perfect record of protecting client assets. Why is a Leaden loan different? Well, with custody loans, collateral is not lent out to generate interest, no credit checks, no monthly payments, apply in minutes and repay whenever you want with zero penalties and proof of reserves. Reports verified by a top accounting firm are published every six months. LEDN gives Bitcoin holders a secure, transparent way to unlock liquidity without selling. Learn more@LEDN IowaWalker that's LEDN IowaWalker if you're hodling Bitcoin personally or for a business, here's the uncomfortable truth. You probably don't have insurance. Most policies exclude Bitcoin, and the ones that don't, they only pay you back in fiat. What's the point of that? If you need to claim a loss when number go up, that's not insurance, that's liquidation. Now there's another option. Bdic. They're building an insurance marketplace on the Bitcoin standard. One Bitcoin lost equals one Bitcoin paid. They've integrated with Liana business for enterprise self custody, with personal wallet coverage options coming later this year. If you care about protecting your Bitcoin as Bitcoin, sign up for the waitlist@bdicio Walker. That's bdic IO Walker insurance on the Bitcoin standard Blockstream Jade delivers robust security with fully open source hardware and software. Its unique Genuine Check feature ensures your device is authentic, giving you ultimate peace of mind. With versatile connectivity options including Bluetooth, usb, C built in camera and SD card, Jade offers unparalleled flexibility and in managing your Bitcoin. Whether you prefer wireless convenience or air gapped security, Jade has you covered. Its innovative design features, a durable metal case, a bright 1.9-inch color screen, and intuitive navigation buttons that make managing your Bitcoin straightforward and enjoyable. Jade also supports secure air gapped transactions via QR code signing using the Jade Link storage device, keeping your Bitcoin safe without compromising convenience. Visit store.blockstream.com and use my coupon code Walker for an exclusive 10% discount on your Blockstream Jade plus, protect your Bitcoin sleep better. Stack harder.
- [18:20]
Walker America
I think that that's. It's a realization that I've very much come to as well, which is again that, that, that it's a meme, right, that you don't. Everything is memetics at the end of the day. Like, you don't care about politics, politics, but politics cares about you. Because I think there is this desire like, oh, you know, once, once I make it with bitcoin, you know, I'll be able to just like go, just disappear away from all this and I'll just retreat out of the world and I don't have to pay attention to it. And it's like, but in this world, you can't go far enough. You can't retreat far enough. You want. We were talking about this a little bit just before we started recording here, but this idea of like America, American exceptionalism is real because America is exceptional. Like western culture is exceptional and superior and is worth preserving. Specifically the brand of Western culture that is Americanism, which I think is unique and has developed in, in a way that has not happened anywhere else. Right. And this idea that, okay, I can just sort of rest on my laurels and assume that I will be left alone and that, yeah, all of the absolute morons and socialists and neo commies in politics are just going to kind of just drop it and go by the wayside. I think it's like, it's a foolish proposition to have. Like, I think, you know, we, we, you know, we must fight for our freedom if we expect to retain it, essentially. And that means just being honest and talking about these things and having people in places of political power, as you said, that are speaking about them, speaking about the things we care about, speaking about the freedom go up side of things in a favorable way. Because again, I would rather live in a country where, not that I need the government to give me permission to use bitcoin. Again, I'm not, you know, not saying that and I don't need them to, but I'd rather they not make it illegal. I'd rather they not give me a threatening, you know, threaten me with a jail sentence for running a node. I'd rather all of those things. And so I think that it's like you, you have to engage even if you want to reject the existing system, even if you think it is corrupt and broken, which it very much is that being said, it behooves all of us to at least engage with it in a productive way and to try and steer it in a direction that we would prefer. And I think that's why, like, I love and support what you guys are doing at bpi, because I think it is crucially, crucially important, especially as we head into a midterm year and I'd love. Or we're in a midterm year and I'd love your thoughts on this. But one of my things that I'm kind of, it's like a wait and see thing is, okay, the Trump administration is pretty darn favorable toward Bitcoin compared to the Biden admin. Like, that's a, that's a very obvious objective statement. Maybe a little bit too favorable towards the crypto side of things, too. We'll leave the Trump coin and Melania coin and all that aside for now, right? Boy.
- [21:14]
Podcast Host
Woof.
- [21:15]
Walker America
But do you think that the conversation has changed enough around Bitcoin? Do you think the Overton window has shifted enough where even a new Democratic administration would not have the same open hostility toward it, toward Bitcoin and even crypto? Or do you think we're very much still in a time where, because it's become sort of a partisan issue, unfairly so, but it's become a partisan issue. There's a great danger there. Does that make sense?
- [21:44]
Josh Hendrickson
So let me, let me start with your first point and then come back to it. And if I don't come back to it, remind me to come back to it, okay, I'm not Trump. I can't do the weave. The. So first and foremost, like, okay, I'm going to draw an analogy to economics. So there's this famous, there's this famous theorem in economics called the no trade theorem, right? And the idea is, okay, if you're in financial markets and what determines asset prices is like the information that everybody has, okay? If the, the only way that somebody would trade is if they have information, okay? But, so if you're coming to me and you want to trade, I should interpret that as you have information. And if I don't have information, I should actually interpret that as you have information that I don't have, right? And so if you have information that I don't have and you're coming to me and you want to trade, then you probably know better what this asset is worth than what than I do. And so actually I should just hang on to it because you're trying to buy it from me. And you have superior information. So I actually should refuse to sell it to you. Right? But if you have this attitude, right, then no one trades with anybody. And this theorem gets a bad rap because people take it seriously. They think that this is like they're trying to. That they're trying to describe reality. And it's like, well, but look at the stock market. People trade all day long. Yes, that's the point of the theorem. Right. The point of the theorem is to basically say, okay, if it's really just all about information, and we know that, why would anybody ever like trade? And Fisher Black had a really interesting paper that I don't think anybody understood where he basically said, well, so it was this paper called Noise. And Fisher Black makes this argument that, well, in financial markets, yes, there are people who have genuine information that they can profit from, but there are also people who think that they have information that they can profit from, and they're wrong. Right? And so this is why people trade all the time, because everyone thinks that they have this information advantage, and they're all trading on this information advantage. And that's why when you, like, turn on cnbc, the little ticker is going across and the stock prices are going up and down all day long because people are actually trading and doing the work. And his point is, is that paradoxically, this is actually what makes markets efficient, right? Because it's this. It's that constant discovery process that you're going through with all these trades that's pushing the price actually closer to where it should be based on, like, actual meaningful information. And the reason that I. That I point this out is that I think a lot of times political arguments, and especially sort of like libertarian political arguments, focus on equilibrium, right? Like, so it's kind of like, well, in equilibrium, this will be true. And so we don't have to worry about that. Or like, this is what. But kind of like the important thing is, is, like, getting to equilibrium is super important, actually. And, like, all the little things that you're doing outside of equilibrium are actually the important things because they're what push you towards the equilibrium. And I think one of the aspects of kind of the political process that this relates to is that I think we in the United States had kind of taken for granted that things just work a certain way because we're in the United States, and that this is not something that, like, the founding fathers believed. They did not believe that, like, oh, we wrote down this Constitution, everything's fine. It will be, you know, like, it's all Downhill from, like, everybody, everything's easy, right? Like, no, they were constantly warning that, like, hey, like, just because we wrote this down on a piece of paper doesn't matter, right? Because it's. At the end of the day, people have to believe in that piece of paper. People have to accept that these are the rules that we all follow and that, you know, society, you know, rests upon. But that, like, maintaining that requires actual work. It requires showing up every day and sticking to those, to those things. And the problem is that one great thing about Americans is that we're all fundamentally frontier people. We all just want to go just far enough away for people to leave us alone. We just want to get far enough away where we kind of do our own thing, be left alone, explore, do whatever it is that brings us happiness. And so that's a great thing about Americans, but it's also a weakness of Americans because fundamentally, like, that's this aspect of like, just wanting to be left alone, right? Just wanting to find your plot of land and do your own thing and be left alone. And the thing is, is that the people who want to be left alone will always be defeated by the people who refuse to leave them alone, right? Because it's this never ending process of I want this, I want this, I want this, I want this. And you're like, nope. And like, I just want to be left alone. And eventually you get to a point where it's like, okay, fine, I'll make this little minor concession. So you go away and then all of a sudden you wake up one day and you've made like 30 concessions and now things are really, really bad. And so, I mean, that's one of the things that we need to get back to is we need to get back to this idea that this is like, that there is something about America, right? And it's. And that's not just the documents, right? That's not just speeches by our founding fathers. That's not just platitudes. But that, like, actually things required action and that you always have to be taking those actions, right? Like my dad's side of the family, like they, you know, like they fought in the Revolutionary War, you know, they fought in the Civil War. They fought, you know, in World War I and World War II, like in Korea and Vietnam, right? Like this. I hear people all the time talking about escape plans, or I hear people all the time talking about, well, if things go bad, I'm going to do this, there's nowhere to go, right? And also, why should I go this is my home. This is where I'm from. And so I shouldn't have to leave. I shouldn't have to look for something else. But in order to keep that home, a place that I want to live, I actually have to do the work. And that's not to say, oh, everybody needs to get involved in politics, right? Because that's not at all what I mean. Like, most people were not involved in politics, but they were involved in community, right? They were involved in, you know, keeping things locally the way they. They wanted things to go. Because that's where you have the most control and sort of limiting the control that you give, the further these people are away from you. And we just have to get back to. To that aspect of it, because this is. It requires actual work. Like, you can't just. You can't just coast on what your ancestors did. You can't just coast on the fact that, like, hey, they wrote this constitution. And, you know, isn't it great that, you know, that we've had all these years of prosperity? Well, we don't have the years of prosperity just because we wrote these things down on a piece of paper. We have them because people committed to them and people did the work. Right. And I think that's a thing that appeals to people in bitcoin, right? Because people are always talking about, you know, like, a fundamental aspect of bitcoin as like a proof of work. Right. And I think that the reason that that sort of meme of proof of work is so strong is because once you start thinking about it, you realize just how strong that is. It applies to everything. It's not just important for, like, money, Right. It's important for every single aspect of your life, is that anything that's going to provide you value required some work. Right? And so you have to do the work if you want the reward. And you can't just coast on those. On those things.
- [30:17]
Walker America
Amen to that. I want to maybe give you a. There's a lot to unpack there, professor, but maybe I'll just give a quick comment on that and then I'll remind you of the weave that we'll bring it back to. But I think that I'd. That's. That's such an important sentiment that people are somewhat losing touch with this idea that America doesn't just passively exist, that America is an active pursuit, that it, you know, that it needs to, like, steel saying, like, the tree of liberty needs to be refreshed from time to time with the blood of patriots and tyrants. And like, you would hope that that's, you know, doesn't need to be refreshed too often with that. But this country was fought for, has been fighting for a couple, you know, 200 and a half years. And it doesn't just continue to happen and be exceptional and be, be excellent because we're all resting on our laurels. It happens because people actively make it. So I think there are many that would, would like, wish to make it not so despite all. And this is what, this is what just irritates me to no end is like, you have these, you know, neo communists and democratic socialists who want to just bemoan the current state of things, realizing that the only reason they even have the ability to bemoan them is because of the exceptional prosperity that America has created, not just for America, but for the entire world. And yes, are there problems? Are there flaws? Absolutely. However, it's like it's still done more than any other nation on Earth to further the human condition broadly. Like, you know, we, we went from, look at the poverty rates from 100, 200 years ago to now, right? It's just, it's, it's, it's no contest, right? It's went from like, you know, 90% to 10%. If you look at, you know, infant mortality, motherhood mortality, all of these, you can look at any of these different markers of like, what is progress for a civilization. And they've all just basically inverted in the past, you know, 100 to 200 years of America. And that's an incredible thing, right? And that is something that should be protected. And to your point of, like, where are you going to escape to? This is what I come back to all the time. It's like, it's like, okay, like, you're not going to go to Europe right now. Like, good, you know, good luck over there. You want to go, go, go to the United Kingdom or, you know, not that that's even Europe anymore. You want to go to Germany? You want to, like, you want to go to France? No, you're not going to do that. You want to go to El Salvador? Okay. El Salvador is doing amazing things to bring back the rule of law, right. From a lawlessness and from a, you know, cartel control. And by all means, I'd like, I support what they're doing there in El Salvador. Absolutely. I love, I love going there. I'm also just not going to leave America. I'm not going to flee to Canada, not going to flee to Mexico. You know, I'm not going to, I Would maybe Switzerland, except they won't take me, like, because they have actual borders, like the Switzerland. A Swiss person once told me, they're like, you know, Volker, excuse. This is not a good Swiss accent. But Volker, you know, Switzerland is the only first world country. And I was like, yeah, okay. And then I spent a little bit of time in Switzerland and I was like, I think you got a point, actually. Yep. Boy, they have some. They have very tight borders. I'll just say that is very hard. You cannot just. You cannot just move in there. But I guess zooming out, it's like America is something that needs to continue to be protected, this idea of America. And that doesn't mean you have to love the government. Doesn't mean you have to love the current government. That's not what makes America America. Americans. Make America America. And that adherence to the American idea of individual liberty, but also of community and of resisting the totalitarian temptation that America has been able to for so many years now. I do want to bring this back, though, to the current political landscape, let's say, because that's where our weave was going to bring us. And, you know, do you. I mean, how much does there. Okay, let me put it this way. How much do we exist in a uni party, in this Coca Cola, Pepsi Cola democracy where it's like, you don't like Coke, it's okay, we got Pepsi. Basically the same thing. Or how much is there meaningful difference between the two? And how much is that going to matter, specifically as it relates to Bitcoin privacy, tech, freedom. Tech more broadly.
- [34:43]
Josh Hendrickson
So I don't think it's all fake. Like, I don't think that this is, you know, Coke versus Pepsi and you're indifferent. You know, you go to the restaurant. Which actually is one of my favorite things about going to restaurants. If you go to a restaurant and you order a Coke and they're like, oh, I'm sorry, we only have Pepsi. I just always. It makes me think, like, is there a guy? Because they always say, oh, we only have Pepsi. Is that okay? And I always makes me think, is there a guy who's just like, just, just, I'm out. Just, you know, because they always say it's okay. So, like, somebody must have at one point gotten really upset about this.
- [35:12]
Walker America
I'm out of here.
- [35:14]
Josh Hendrickson
But. But no, I don't believe that it's fake. And the reason that I don't believe that it's fake is, first of all, I refuse to believe in nihilism. There's a Nihilism that. I don't know what your feed looks like on X or whatever it's called nowadays, but there's just like this growing nihilism from all sides. Just everything is, you know, everything is, you know, everything's getting worse. Nobody, you know, but like, all the people who promise that they're gonna fix things or they're all the same. I mean, you know, you can be correct in your sentiment that they're. That these people are not going to fix your problems without having to go down this nihilism route of like, well, nobody can fix my problem problems. I don't believe that it's fake because the way that people talk in politics is completely different. And also the way that people behave in politics is completely different. I think that one of the things that you see is, I mean, first of all, let's just talk about political violence. We have had now at least three attempts to assassinate the current president. We had a, you know, I guess I would say conservative podcaster, although maybe that's an insult, right? In Charlie Kirk, I don't see a
- [36:40]
Walker America
podcaster as, well, just for getting.
- [36:42]
Josh Hendrickson
Getting. Well, I mean, well, he was.
- [36:44]
Walker America
People use it as one, which is funny because it's like, you wouldn't call, like, you've got a podcaster who gets more views than all of the legacy media combined, but you're not like, you know, look at that. Look at that news anchor. What a. You know, like, you don't use that as a pejorative. But. Sorry, I digress.
- [36:58]
Josh Hendrickson
No, but I mean, that's why I said it, because I think, like, there. Some people use that term, like, in order to, like, kind of minimize like, like the influence that. That somebody like that had. But you look at. You look at him, okay? He's shot on a college campus, and this is the guy who is known as the. Like, let's argue through things, like, let's talk about ideas. And so political violence has ramped up. And it's not only that political violence has ramped up, but the rhetoric has ramped up. The rhetoric is all existential, right? The rhetoric is like, no, you are. This is the world that we deserve, and you're preventing me from that world. Right? And I think that that's an extremely dangerous form of politics, is that when you're, you know, making these claims that sort of like, your opponent is standing between you and a. In a righteous and just world, right? Like, this is. This is very. This is very hard to actually have a normal politics. And I don't believe that that's all fake. And I don't believe that it's all fake because, you know, like, you. You see these actual acts of violence. I think that. There are choices. I mean, the, The. The Democrats really haven't softened on bitcoin or crypto. There are younger Democrats and more moderate Democrats who have kind of softened on this, but I don't see any softening at the. In the leadership of their party. The leadership either doesn't seem to care at all. Like, this isn't even an issue that we should care about, in which case, like, that's. I would prefer you just not care about it. Right. But then there's also kind of just this attitude of, like, no, actually, this is bad. And, you know, we don't. You know, we don't. We don't want this. And so, I mean, to me, I don't think that we're. We're just living in this pretend world where everybody fakes, you know, arguing with each other. I know that's a popular take that people had, but I think, honestly, this is. It's a popular take that people had because for most of our lives, it was kind of true. Like, for most of our lives, it was kind of true. Politics was, like, it was very performative. There wasn't that much difference. You know, the parties were much closer to each other than they are now. I don't think that that's the case at all. And I mean, part of this gets to the fact that, like, socialism has been normalized. And this is remarkable to me because, you know, one of the things that I like to kind of talk about is sort of like this juxtaposition of two experiences. So there's this very sort of like, libertarian hedge fund guy, Jim Rogers. I don't know if you ever heard of him. Like, he's pro. He's. He's got to be. He's before my time, so he has to be before your time. And I knew him as, like. As, like this. This guy who just went on television, like, with a bow tie, right, to talk about commodity markets and stuff like that. But, okay, he got his start in a hedge fund, ironically, him being like, you know, super libertarian. He was in a hedge fund with George Soros. And the. And the thing is, is they. They made a killing in their hedge fund. And in the late 1980s, Jim Rogers just decided, I've made enough money. Like, I'm going to retire. And one of the things that he did is he decided that him and his girlfriend at the time they were going to ride motorcycles like all across the world. So they were just going to ride from one end of a continent to another. And then, you know, like if they ran out of land, they would just take like a ferry to the nearest, you know, land mass and then just continue on and just go all around the world. And he documented this in a book called Investment Biker. And it's a really good book. And the actual, because the actual travels, whether he's knowingly doing it or not, he's like teaching you a lot of economics along the way because he's talking to you about the experiences that he has in these various places. And so he's talking to you a lot about like, what are the institutions like in these places? What are markets like in these places? But the thing that I found fascinating is like when he goes to the Soviet Union, it's like the dying days of the Soviet Union and he gets to Russia and when he gets to Russia, he is shocked at just how different it is than the West. So he's in Moscow and he's like, I just want to find a coffee shop. And there's like no coffee shop. And the coffee shops I do find they just have coffee. You can't get a muffin or something with your coffee. It's like just the coffee. There's no specialty coffee, it's just coffee. Right? And he, he just finds this so bizarre. And then he goes to a department store and he goes into the department store and there's hardly anything available to buy. There's these really long lines of people buying very limited amounts of goods. And he goes to the grocery store and like, same thing. Like there's just, there's there, there's tons of stuff that's just not available. And. And then he like goes out into more rural areas of Russia and he starts talking about, oh hey, like he starts talking to the people out in these areas and they're like braggin, like we've never experienced inflation like in our lives. Like prices have never changed. And he's like, yes. And like prices have never changed. And what am I looking at? I'm looking at like empty shelves and I'm looking at how like you guys have a sign up down the street that says like there's no gas when you're like one of the biggest oil producers in the world because you kept the price fixed for all the Russians, but then you sell it on world markets for like what the actual price is. And so you're. And so domestically, you know, people just don't have access to it. And then. And then he's also talking about how ridiculous it is to say that they have no inflation, because he's like, yeah, because the. The local prices are so low, but I pay an even lower price in dollars than I do in the local currency. And so you tell me that this is inflation. And no, like, you haven't experienced inflation internally, but like, your. Your exchange rate has depreciated so dramatically because of that. Right. That you're actually willing to take even fewer dollars to get these things. And so it's even cheaper for me to get them because you're just so desperate to have something that has some purchasing power to it. And the thing that's striking to me about this story is this is like 1988, when he's over going through the Soviet Union and he's going through this experience and how dreadful this is. But there's also this famous experience in 1989 where Boris Yeltsin comes on a visit to the United States. Boris Yeltsin comes on a visit to the United States. They stop at the space station in Houston to give him the official tour. And then they were getting on a plane, I think, to go to Florida. And on the way to the airport, he's like, could we just stop at a store, like a grocery store, and just look around? And they go to this grocery store. And Boris Yeltsin is shocked by what he sees because all the shelves are full. And not only are they full, but every. All the packaging is colorful. And there's a famous picture of Boris Yeltsin standing above one of those freezers with his arms stretched out, just shocked at the sheer number of flavors of pudding pops that they sell at the store, right? And. And he's asking the employees, like, these crazy questions, like, what kind of intense training did you have to go through to work here? And, like, the grocery store workers are like, like, I work at a grocery store, right? Like, in America, like, you can get that job out of high school. Like, what are you talking about? Extensive training. He's like, what kind of college degree did you need? This is the kinds of things he's asking the store manager. And store manager's like, no, I've just kind of worked my way up. Like, I started here when I was 16, and I just worked my way up to manager, right? There's no. It's learning by doing, basically. And then. And he's just like, well, how do you know to get all of this stuff to the store? And how do you know, like what people should produce. And the under reported aspect of that story is there are a bunch of biographies of Boris Yeltsin that describe him afterwards. So when they actually get on the plane, there are a bunch of stories that basically describe him as like having his head in his hands and describe him as being completely like despondent and allegedly like what he tells his aides and things on the plane is sort of like we have lied to our people and like we have like we've betrayed them. Like, what is available to the average American is something that's not even available to like, you know, the, the most important Soviet leaders. Like, we don't even have this kind of access. And, and in a lot of ways that that trip to the grocery store actually mattered for the collapse of the Soviet Union. But the juxtaposition of those two experiences, an American going to the Soviet Union and you know, a Soviet citizen coming to the United States, illustrate sort of the, the promise of socialism versus the actual like delivering on that promise of capitalism. Right? And, and it's remarkable to me that just in this very short period of time, okay, so I mean, this is like within my lifetime, like I was like in kindergarten, okay, when this was happening. The. Somehow we've like forgotten all of these lessons and now we're just gonna like dive headfirst right back into these failed ideas. And it's. And it drives me absolutely insane and it drives me absolutely insane because like, no serious person can believe these things. Like no serious person can believe that this is actually going to generate prosperity. Like these are luxury beliefs. These are beliefs that you can only have when there are no consequences for believing them. And when you live in a society where you're allowed to have those kinds of beliefs because you already make a decent living for yourself. And so, you know, you don't, you, you don't bear the consequences. That's what all of this is from. And the problem is, is that this has been completely normalized and to the point where now it's like in order to be a leading candidate in a lot of places, you actually have to advocate for these kinds of policies. Like we have, I mean, like, it seems like, you know, like we. There used to be this joke that like that crypto was like speed running financial history. Like they were just discovering all of the scams that people ran throughout history just over and over and over again. And I just. This reminds me of like, okay, now we're just gonna speed run the 20th century. We're just gonna relearn all of these lessons over again. And I'm sorry, but I'm not willing to go through that. I'm not willing to go through that. I know how this ends. I know it doesn't work. And people just don't want to. They want to play word games and they don't want to be honest. And it's remarkable because I don't understand it because some of the same people who advocate for these kinds of policies will tell you that things like nation building is a failure, right? And, and things like that. And it's like, yes, you're onto something. Okay, like let's follow that logic, right? Like, yes, we can't just go into a country and overthrow their leaders and just hand them the United States Constitution and say, all right guys, we did it. Right? It's, it's all going to be like, why doesn't this stuff work? And why doesn't it work to just go in and impose these things from the top down? And, and that like ties. So maybe I am doing the weave because I'm going to tie this all together, right? Is that, yes. Is that they, you know, all of this stuff is interrelated, right? Like the, where we are today in the United States, like you can draw a line from like the Magna Carta to today. And like we are like inheritors of that tradition, right? Like this is. And it's a gradual process, it's a time consuming process, but you work there and your institutions evolve, right? And they evolve in a particular way because you have a particular people who act in a particular way in a particular time, right? But you're not allowed to talk about these things, right? Because we are fish who are not allowed to notice the water. We're not allowed to talk about things like Christianity, which is the basis of Western civilization and which major aspects of our civilization only exists because of that. That. Right. And that doesn't. But, but the amazing thing about this, right, is that when you make that argument, people think that you're sort of making some like overtly like, religious argument that. Or that you're, you want to impose your religious beliefs on other people. No, that, that's actually the remarkable thing is that like Christianity has sort of generated all of these societal changes that created benefits for Western civilization that are available to you regardless of whether you're Christian or not. And that is like a, that, that is an amazing thing, right? And you think about all of these sort of political change taken place over time. Like restraint on the executive goes back to the Magna Carta and you can trace our political heritage back to that moment, right? But that comes from a particular people at a particular time. And it's those same people who settle the United States. It's those same people who spread these ideas through the United States. It's the same people who show up here with that attitude of self governance, right, that end up creating the sort of institutions that we have that start creating the, you know, the, the attitudes and the ideas that lead to the things like the Declaration of Independence that lead to things like the, the Constitution. And it's. But the thing is, is that the one constant thing here is, is like there, there's not only a consistency in ideas and, and institutions, but there's this consistency in the desire of the people to push society forward through those institutions and through, you know, those, those constraints. So because they recognize that this is their path to a better life. And what we see in opposition to this in terms of socialism is a, is the complete opposite, right? The reason that socialism has had such a hard time in the United States is it's antithetical to the United States. Like the United States comes out of this completely decentralized process, right? Like we live in a world, we are the inheritors of English common law. English common law is based on precedent, right? Like this is like it evolves over time. Like it's interpreted by judges to have a particular meaning. And, and, and that meaning persists like through time, right? The all of these sort of institutions are kind of developed in a sort of decentralized way, right? That, and where freedom is sort of inherent in all of these things, it's always sort of like every sort of complaint and every sort of change in the system along the way is sort of like, you know, you're infringing on like my God given rights, right? And the problem is, is now we flip that on its head. So people have recognized that like rights arguments work. So now everything is a right, right? Like we, we have a right to everything. Now anything that I want, I have a right to that. It's my God given right. And it's like, no, no, actually I don't, like, I have no right to go play in the NBA. Okay, I, you can try, right? Like I had my opportunity, I didn't make it right? So I have no right to that. And, but everything in the socialist system is sort of top down. It's imposed from the top down. It's command and control. It's antithetical to this sort of process. And so the thing is, is the only way that you can get that is that you have to start tearing down the existing institutions so that you can start over, right? Because everything that a sort of socialist society wants to do, and the reason it's been so hard to. To get people on board for that in the United States is it's antithetical to the American way. The American people instantly hear that argument and go, nope, that's not us. Right? In ways that doesn't happen in other places. And again, that's another interesting question is like, why aren't people in the United States susceptible to this as much as other people have been? But so now what you have, though, is that there's this recognition that. That Americans are resistant to this idea. But for some reason, no one reflects on this and thinks, well, maybe they have. Maybe there's something here, right? Like, maybe there's something that important that I could learn from the fact that they're so resistant. Instead, what you have is you have this desire to. Well, okay, what the problem is, is you've got all these institutions that have kind of all evolved over time. They're pretty. You know, they came from sort of decentralized processes and kind of ended up in this kind of centralized framework that we call the United States government. And so now what we need to do is we just need to start undermining these institutions. Because once the institutions break down, then people will be looking for a solution. And, boy, have we got the solution for them.
- [54:06]
Podcast Host
Right?
- [54:07]
Josh Hendrickson
And I think that this is extremely dangerous. I think this is really, really bad. And I don't like that this has become mainstream. I don't like that these ideas are suddenly super popular because we know how this plays out. We know how this ends. We know what this is going to be like. We can look at north and South Korea. We have a natural experiment that we can, like, pull up a map of North Korea and South Korea at night. Pull up the map and look at the map at night. It looks like South Korea is an island off the coast of China, right? Because North Korea has no lights. They have no lights because they're poor. They have. They are poor because they are a communist country. Like, this is. You know, it's not that the South Koreans are harder workers than the North Koreans. It's not that they have a different climate for growing food. It's not that they have a different resource and natural resource endowment. It's not any of these things that people claim are the reasons that one place is rich and another place is not. It can't be any of those things. By definition, what it is is it's a difference in their economic system. It's not even a, you can't even argue that it's a difference in their political system because for a long time the South Koreans had a pretty authoritarian political system, but they had a market based economic system. And so the idea here is that, you know, it's predominantly driven by that. We have this evidence, we know how this plays out. We can look around the, we can see what countries are rich and what countries are poor and we can dig into the questions of why that is. And when you dig into those questions, you quickly realize that a lot of the things that people are selling you and that people are promising you are not only not going to be, are not going to work and not going to solve your problems, they're actually going to make you much more like the poor countries.
- [55:52]
Walker America
First of all, killer rant professor, I wish I could go back in time and study, study under you because boy, I would have been maybe a little bit more, more inspired than during my engineering classes in, in college. But one thing I really want to poke at that you said there because I think this is really the, the dumbfounding thing and the just maddening thing to me is this idea that we know, we know how this, we've seen this movie before. We know, we know how this story plays out. Anyone in my mind, like it's, it's crazy for example, for somebody in the year 2026 to be like, yep, I'm a Nazi. You're like what the fuck man? Like that's super mess up. We're gonna like shun you. Like that's like, that is like, are you kidding? You're a not like a Nazi after every, like geez, like okay, there's something wrong with you. Like you are, you should be shunned. Right? Similarly, we should treat self proclaimed communists and socialists that way. It's an ideology that's responsible for or well in conservatively, a hundred million dead in the last century. Conservatively, like that's just like attributable first order, you know, like between, like that, that's a, that's a conservative estimate, 100 million ballpark right. You're advocating for an ideology that has killed at least a hundred million people in the last century, but for some reason that one is academically and politically palatable. You can't, you won't be an academic if you're like yep, I'm a Nazi. You won't be in politics if you say, yep, I'm a Nazi.
- [57:24]
Josh Hendrickson
Now.
- [57:24]
Walker America
They love to call everyone a Nazi, right? They love to do that. But you can be very in vogue if you say, yep, I'm a communist. Like, wow, how. Of course you are. You must be so, so cultured and what a. What a man or woman of the people, right?
- [57:38]
Podcast Host
And it's just insane to me, like,
- [57:40]
Walker America
we should treat communists and socialists with that same contempt that we would treat somebody who's like, yep, I'm a Nazi. Like, like, this is just nuts to me that this has become so. To your point earlier, socialism being so normalized, despite not just the historical evidence. Like, to be a socialist, to be a communist, you not only have to be economically illiterate or in denial, you have to be historically illiterate or ignorant as well. You also then have to just not use your eyes and ears in the present, because as you said, we have a literal, still running longitudinal study on this.
- [58:15]
Podcast Host
That is the Korean Peninsula.
- [58:17]
Walker America
We have it. It's.
- [58:18]
Podcast Host
It's right there.
- [58:19]
Walker America
We can look at it and see that if, if anyone listening to this, if you've never seen the. The space images from space of North Korea and South Korea at night, like it. Just Google North Korea, South Korea, nighttime, like it. It is. It should tell you everything you need to know. But somehow these ideologies are so insidious that they have managed to still gain purchase even after they fail every single time, even after they lead to unimaginable amounts of death and destruction, even after they lead to societal collapse every single time, even after they ultimately lead to the subjugation of the people.
- [58:56]
Podcast Host
This isn't.
- [58:56]
Walker America
The free people have this idea that, like, communism is like, oh, well, then. Then I'll be free to be an artist. It's like, no, you won't. You're picking cabbage. You know, brash.
- [59:05]
Josh Hendrickson
Like, you're.
- [59:06]
Walker America
You are picking cabbage because we said you're picking cabbage. Also, there's no more cabbage. And you know, you're. I hope you like spinach. There's also no more spinach now. But Carla, my incredible wife, was born just after the fall of a communist country in that formerly communist country. Her parents, you know, at different times, defected from that communist country. It was Romania. I think she's been probably public about the fact that she's Romanian. It is not like you talk to anybody who lived through communism. They don't speak about it highly. Shockingly, it's also this really weird thing where people always seem to flee from communist or socialist nations. They never flee to Them, unless you're like Hassan Piker, right? And then, you know, you go and stay at a five star hotel in Cuba while the rest of the country's out of power. But you still have power, so it's okay, you know, Champagne socialists, right? But this is the insane thing that I don't understand why people can't grapple. It's like nobody, nobody's fleeing to Cuba, nobody's fleeing to North Korea, nobody is fleeing to any communist country. People always try to escape them. And I cannot, I cannot fathom. Maybe it's just because like there is so much socialism already ingrained into our political and economic system. There is already so much. Even in America we have like a lot of it, right? Look at entitlement programs. Like people say, like, oh, we need to do more for the. It's like, do you know how much of our budget goes to just entitlements? Like it's a lot. Maybe it's because that has become so normalized that people think, well, that's part of capitalism somehow. This mismanagement, this top down is actually part of capitalism. Maybe it's the fact that we just. People don't actually understand what capitalism, or is maybe better to say like what a free market looks like because we haven't actually seen something that looks like that in modern memory. America is like the closest, but it's still, it's still not right. We still have a central bank, which Marx would have loved. Like it's just, but it's, it's frustrating to no end because you see these people so confidently saying like, we just need to tax the rich and just we need to implement and socialist policies. It's always framed as, this is like the more empathetic thing to do. This is like I, I care so much, I care so much about other people, which is why I'm a socialist, right? And it's like, it's just so backwards. I don't know if maybe, maybe just because most people are stupid too and like that's just, it's, you know, same as it ever was. I don't know. But if anything makes me a little nihilistic, and I'm not, I'm quite an optimist, a staunch optimist. But if anything makes me a little nihilistic, it's the recurrent trend of people wanting to go back to socialism, despite all the evidence to the contrary, that shows us this is a, a deadly disastrous ideology. And I don't know how we, I don't know if that ever goes away? I don't know.
- [61:51]
Josh Hendrickson
Well, first, one of the things I like to tell people is, like, in economics, like, we don't. We don't ask people why they do things, right? So. Because they're. They're notoriously bad at it. But not. And not even in a way that, like, it's not that. This is not an argument that, like, people are stupid. Like, just think about an example. Like, suppose that there's an increase in the demand for beef, right? Okay, now imagine that you own your own little meat market, okay? What you're going to see is you're going to see people coming in and buying beef, and all of a sudden you run out of, like, inventories of beef. So then you have to put in a new order for beef. Meanwhile, everybody else who owns their own little meat market, they're also putting in additional, you know, orders for beef. The problem is, is that there's a physical limitation on how much beef can actually be brought to market, because, you know, that has to come from cows. And so. And those co, you know, take a little time to turn into beef, right? So you can't, you know, like, you can't just decide, we need more beef and then just, you know, have a bunch of more cows. There's a whole biological process right there. So the thing is, though, is then what's going to happen is, is that because there's this increased demand for beef from all of these different meat markets, the people who are selling the beef are going to start raising the prices of the beef because they don't have enough to sell to everybody, so they're going to start raising the prices. And so when you go into the meat market and you see that the price of steak has gone up, and you say to the guy behind the counter, hey, you know, this is more expensive than it was last week. Why is it more expensive? What he's going to say to you is, my costs have gone up. But I literally started the example by saying that we know that the cause is that demand is high, okay? So the reason that we don't ask people is because they. They don't study why things are the way that they are. They all they have is their own experience, and their own experience tells them what to do. It's actually a great thing that this guy just thinks that his costs are up because it. Because that's the thing that encourages him to raise his own prices and causes people to economize on beef because there's not enough beef for everybody to go around at the Old price. And so we have to have a way of rationing that beef throughout, you know, the society. And so the market allows this to flow to the people who want beef the most. And so if there's an increase in demand, there's not enough beef to go around. The price goes up. That's how we allocate the beef. There's a couple lessons here. One, you don't want to ask the guy why the price went up because he can't tell you. He's just going to say, my costs went up. The second lesson from this example is that this illustrates, like, the actual importance of the price mechanism. And this is like, like why it's so hard for people to understand. Because again, this is like this decentralized process, right? Like, all these individual people are all making these individual decisions, and nobody has an idea that there's not enough beef to go around. There's not a single person in this entire example who is aware of the fact that there's not enough beef. They just respond to the incentives that they face specifically, and that response causes them to move in the right direction that ultimately gets us to the beneficial societal outcome, right? But it's through that decentralized process that you get that. So, A, we don't want to ask the guy why, why it's going on, but B, there's actually underlying all of this is there is this process by which we get the beef where it's needed most. And that's the thing that we're all trying to do. That's the problem that society is trying to solve. But it's not, like, sexy or romantic, right? Like, where there's no, like, because there's nobody, like, designing this, there's nobody who can take credit for it, that kind of thing. So first of all, I think there's a fundamental misunderstanding of just how markets work and sort of how remarkable markets are to begin with, right? And part of that is because of our own prosperity. Like, when you come from a place that's had a lot of prosperity, you just kind of take prosperity for granted and you just think that you can change things at the margin and they won't really have any effect because, you know, we're already rich. And so, like, you know, and even if they're going to have little costs here and there, like, so what? Like, you know, we're pretty rich, so we can handle the cost. And wouldn't it be better to have this little cost to make these people over here better off or something like that? And you can Convince yourself of those things. And that's sort of like the economics, I think, of why these arguments are recurring is that it's actually really hard to teach people about markets. And it's really easy to teach people that, like, oh, we just need more control over this so that this bad thing doesn't happen. But the other thing which you're not allowed to say is that at least not in an academic conversation, but it's 100% true, is just, just socialism and communism are the politics of resentment. They just are. It's the politics of resentment. They're always coming from a place of punishing successful people. That's where it's always coming from. Right? And a prime example of this is like, you can just ask people these things. So if you talk about, like, inheritance taxes, there's a famous paper in economics that talks about how, you know, like, if you suppose that some amount of your income that you generate over the course of your life is entirely just due to, like, good luck or bad luck, right. You can construct an argument for like an inheritance tax that like, hey, yeah, like on, you know, that on average people might be earning, you know, what they deserve to earn based on their effort, et cetera, et cetera, right? But like, you know, some people experience good luck and some people experience bad luck. And so if you had those taxes, they would kind of correct for those kind of deviations from the average. But the funny thing about this is that in that paper, it says that one of the things that you could do is you could tax, is that you could have an inheritance tax. But the other thing that it says that you could do that would produce the equivalent outcome is you could subsidize low inheritances. And if you subsidize low inheritances, you would actually get the same exact equilibrium outcome. And so what they showed is that there are these two equivalent policies that can produce the exact same outcome. The thing is, though, is that if you ask people, like, do you want to tax inheritance for, like, really wealthy people or do you want to subsidize inheritance for really poor people? They never go with the subsidize the really poor people. It's always the let's tax the rich guys, right? But it's the same policy in this model. But somehow there's this idea that, no, no, no, like we'll just tax the rich, okay? It's. It's a politics of resentment. And look, again, this is part of the fact that we as a society have not done a good job of like, sort of Doing the work and maintaining things and actually paying attention to how things are affecting people, right? So the thing about our politics, and I think the reason why some people think that there's no distinction, right? Because there are all these people who, like, supposedly, like, were like, Bernie voters who voted for Trump because Bernie lost or whatever. Okay, but, like, the. But I think, like, that, that makes people think things are fake. But, like, no, actually what's going on is that there are lots of things that are broken. Like, there are lots of aspects of our society that are just simply broken. And because those things are broken, people want them to be fixed. But of course, people have very different ideas about how you go about fixing that, right? For some people, it's like, well, let's just stop doing this thing that doesn't work, right? For other people, it's like, no, the system has to go, right? We've got to overthrow the entire system and just start over. And I think that overwhelmingly the people in the latter case, they're motivated by a politics of resentment in a way that the, that the other group is not. And that's what. But that's what socialism appeals to. Like, there's a reason why, like, there are. There are these surveys from time to time, and, and people always laugh at them because they'll say, okay, we did a survey to see, like, like, where Marx shows up on college syllabi right across the university. And there's always this huge joke, and people always laugh about it because, like, the department that, like, uses, that has marks on its syllabus like, the least is, like, economics, right? But, like, you have other fields like sociology, where it's, like, at the top of the rankings and people laugh at this. But what, what I've kind of mentioned to people over the years is like, well, that's because Marx isn't economics, it's sociology. He has a theory of, like, he has a theory about society, right? He has a theory about how society evolves over time. He has a theory about, you know, like, how different groups respond into different circumstances. He has a theory about, like, you know, the oppressed versus the oppressor, right? Like, this is not that. This is not economics. Like, this is sociology. And, but also, like, the, the thing here is, is that it's not just not economics. I mean, it's. It's that the, you know, like, maybe, maybe some of the policymakers, maybe some of the big, like, idea people, maybe. I mean, I don't know. I'm actually super skeptical of this because, like, Hassan Piker Actually seems like, like an actual moron, but like the. So I, like, I'm not sure that he actually has read this stuff. Stuff, right. It just seems like a. It's luxury beliefs combined with a politics of resentment, right? Like you, you've. You've been, you. You hear about this much better world that you could possibly have that would punish all of the people who seem to be benefiting from the current world that's not working for you, right? And, oh, here's this system that will not only make me better off, but it will punish all of these people who are benefiting from the system that is not working me. And so people flow into that. Like, there's no surprise that socialism, you know, that that sort of the, the, the popularity of socialism ebbs and flows, right? When things are going well for the overwhelming majority of the population. Like, there's not a lot of interest in, like, debating socialist policies. It's when things are going bad, like when, when socialism starts to dominate the conversation, that's a sign that things are going very, very poorly for people, on average, in society, and that you need to take that seriously. And in fact, that's one of the things. That's one of the reasons I don't think politics is fake right now is that, you know, so many people want to talk about Donald Trump and they act like, Donald Trump caused this. Donald Trump caused this. No, Donald Trump is the effect. He's not the cause. Donald Trump is the first person who just showed up and recognized the things that other people were complaining about and started talking about them publicly. And people were like, oh, that's the guy. Like, you know, and you can like him or you can hate him, but the thing is, is that he clearly had his finger on the pulse of what was going on. And, and, and the sort of complaints that people had about the, the population. And, and I would even say that his second administration kind of demonstrates that politics is, is real because there were actually consequences for his election. Right. We've seen a dramatic change in immigration policy. We've seen a dramatic change in immigration, migration. It doesn't matter what your opinion is. It's just objectively true that we've seen this change. We've seen them take very different actions with respect to bitcoin. We've seen them take very different actions with respect to lots and lots of sort of things involving international, you know, the international financial system. Right. We've seen them take dramatic. We've seen them make a dramatic pivot in terms of foreign policy. Right. Like that's not a sign that things are fake. Take, like, that's a sign that things are real. That's a sign that something has actually moved. Because the difference between the first administration and the second administration is the first administration were staffed with the people who didn't have any idea what the hell they were doing there. Like, they, they were Republicans and a Republican one, and so they found themselves in a position in a Republican administration, and they just kind of did what they did in Republican administrations for the most part. Right. There are a few exceptions, obviously, but, like, but for the most part, that's how it worked the second time around. That's not at all true. True. Like, most of these people would not have found their way into a Republican administration, you know, eight years ago, 10 years ago, like, you know, 16 years ago. And, but the thing is, is that the, the people that have been brought into that administration, you can, you can dislike their, their policies if, if you want to, but it's very, very clear that they have a particular view of what should be done to fix the things. And, and they, there's a clear recognition of the problem. Problem. Like, in fact, like, I think that, like, if you reflect back on the 2024 election, like, I don't want to overgeneralize, but I think, like, initially when Harris took over, like, her campaign was like, oh, this is the. We're not, you know, our, our, our opponent is negative. We're going to be like the, the party of joy. What's the market for joy? There's no market for joy. Like, there's no market for joy. People are frustrated. First, first of all, her own voters, like, think that, you know, Donald Trump is evil and a threat to, like, their way of life. Right. And so, like, they're not interested in whether you're joyful or not. They're interested in whether you can defeat this man. Right. And then if you look at the people who are going to vote for Trump, like, those are the people who are, like, you know, he's actually speaking to the things that I think are wrong in a way that the other party is not. And frankly, that the other party used to speak to and kind of abandoned. And so I think that, like, that's a sign that politics are real, but that's also indicative of this entire thing. Like, the shift to the left on the, you know, the shift towards socialism on the left is really, I think, motivated by this resentment. The shift towards Trump is motivated by a very same, by a very similar thing that, like, things are broken on the right. It's just that they're very much the attitude, whether you believe they can do it or not, the attitude seems to be like, like, no, let's just try to fix things. Like, let's try to stop doing the dumb things and start doing the right things. And those are just two very different attitudes. But I also think that this is all tied up in lots of different issues, right? It's tied up in a lot of different issues because part of what made America resistant to, to communist and socialist ideas is sort of the American way of life, but that requires actual effort on the part of Americans to maintain that way of life. Like, one of the things that people that doesn't get talked about because it's uncomfortable is that when you talk about immigration and people talk about like, oh, like, you know, the American people have always, you know, like, they've always been negative towards immigrants and they've kind of not been very welcoming towards immigrants. And again, like, this is kind of uncomfortable to say, but, like, that's kind of why assimilation works, right? Is that when, when people show up and you're super skeptical of them, then they, they feel the need to actually be more like you and to show that, like, no, they're here for the right reasons and kind of. And that sort of thing. And so again, when you take that away, when you're like, no, no, no, that's like, that's mean. That's evil. You shouldn't, you know, you know, you shouldn't be skeptical of them just because they came from another place. Well, then lots of people show up and then they don't share the values that, that you have, or they don't show up or they don't. And it's not even necessarily malicious. It's just that, like, they don't, like, they don't have to. They don't need to. It's not part of their life. They're able to just live in their own kind of community without having to, to do these things. But then, you know, but then the problem is, is that over time you could get more and more of those people. And then attitudes change. And so now that natural resistance to things like socialist ideas isn't working. Especially when you consider the fact that, you know, during the Cold War, you know, yes, like, all of these people as refugees and things like that, you know, they, they, they, they sort of embrace the American way of life, but they embrace the American way of life because they experience the alternative. They experience socialism and communism. And so they were like, I I. They. They didn't just want to be here because, like, of freedom or because, like, they get a good job. They wanted to be here because they recognize what the world is like outside of that and said, no, no, no. Like, I want to be an American. I want to be every aspect of what it means to be an American. That's what I want out of life.
- [78:19]
Walker America
Life.
- [78:20]
Josh Hendrickson
Because they have, you know, like, I've seen the alternative, and the alternative is bad. And so I think that, you know, when you have these, you know, when you have changing demographics and you have lax attitudes on. And. And you. And you just sort of allow, like, hey, let's just, you know, let a thousand model, you know, let a thousand ideas bloom kind of thing be the norm. Like, no, that's actually bad. Like, America is an actual place. And like any other country, like, one of the weird things is America thinks it's immune from this question, but they're not immune. No country is immune from this question. Every. Every single country in the world has to answer the question, who are we? Like, what does it mean to be an American? Okay? And it's not that. It's not even that we disagree on the answer to that question in the United States. It's not like left and right just fundamentally disagree on that, although now they do. But it. It was never the. The point that they. That they disagreed on, like, the answer to that question. It's that we were forbidden from asking that question. For it was sort of like, no, no, we're America. We're different. Like, we, you know, like, if somebody comes here, it's because they love freedom and hot dogs on the grill, right? Like, it's like, no, like, they like to do fireworks on fourth of July. Like, I mean, this is. And it's just like, I guess that what ties all of this together is that at the end of the day, it's all about proof of work. And we haven't done the work, like, for decades. We weren't doing the work. We were just coasting on American greatness and assuming that it's just kind of a natural, you know, condition of living in the United States. And it's not at all a natural condition of living in the United States. It's actually been created, you know, by your parents and grandparents, etc, right? Who. Who actually, you know, stuck to those ideals, who actually were involved in their local community, who, you know, who spoke up at the school board meetings? Who, you know, who did their part, no matter how big or how small, like, they did their part because there was an idea of what America was and what America should be. And everybody kind of agreed on. And so everybody was doing their part to generate that. To keep that. To keep that American spirit alive. And then we sort of reached a point where it was like, you know, like, actually, this just kind of takes care of itself. People kind of like to live here. And now we're reaping the. The costs of all of that is that when you don't do the work, then what you get is atrophy. It's no different than, you know, lifting weights, right? If you. You can lift weights for years. When you stop lifting weights, like, your muscles are going to atrophy. Like, if you just lay on the couch all day, you're not going to maintain that same muscle. It's the same thing. We haven't exercised the muscle of what it means to be an American for a long time. And so now we have all this conflict and we have all of these existential battles going on precisely because we didn't do the work. And now somebody's going to have to come in and do the work. And you can think that that's politicians, you can think that that's just average Americans who kind of just decide enough is enough and start getting involved in again. But, you know, it's across the board that we have to make those changes and we have to do the work. Because if you don't do the work, you don't get anything of value on the other side. You know, there's a reason why people want the little, you know, the little, like, ab belt that they'll sell on the infomercials, right? Where you just sit on the couch and it gives you little electrical shocks that's supposedly going to build up your muscle. Like, there's a reason people want that because it's easy, right? But if you actually want to be physically fit, you actually have to do the work. And it's no different with politics. It's no different with anything in your life. You have to do the work if you want something of value.
- [82:01]
Walker America
That was another killer rant. Professor, I want to be conscious of your time here, but I do want to ask you, you know, we talked about memetics earlier, and one of the big memes in bitcoin is always bitcoin fixes this, right? So this is just, I guess, kind of a. A general. Does bitcoin help fix this in America, specifically? Does it help fix this, this malaise, if you will, or this complacency? For. Does it Is it uniquely aligned? Like, is the ethos of bitcoin, is that a uniquely aligned with the American idea, do you think? And does that have the potential to usher in a new American renaissance?
- [82:39]
Josh Hendrickson
I mean, I think that like, well, first of all, bitcoin itself, it creates an offering up that really didn't exist before, right? And so it gives you the opportunity to say, nope, like, I can, I can save in a completely different way than I would have under the other system and that you have no control over this. Right? But I also think that the sort of like, for people to actually get value of that they actually have to do. You know, I don't want to sound like a broken record here, but they have to do the work, right? Because you don't convince people that just, oh, hey there, here's this off ramp. So, like, if you're unhappy, just, you know, buy some of this or something. Because what happens is that people inherently are going to want to understand it, right? And for some people, they're not going to actually buy bitcoin until they really, really understand it. Other people aren't going to ever understand it until they buy some, right? It's different psychological things. And. But the thing is, is that I actually think it's the process by which you, you start to learn about these things that helps to fix things. Because the, the fundamental lessons that everybody seems to draw, regardless of their political persuasion, is they, they start digging into bitcoin and then it forces you to think about like, okay, this is money. Okay, but like, but it's not. Like, it doesn't. This doesn't seem like dollars, like, what is it? You know, and, and this is what forces you then to have that initial kind of conversation with yourself, which is like, well, what is money? Like what, what purpose does it serve? Where does it come from? Why do we have a Federal Reserve? And so you start going down that rabbit hole and then I think that it starts really making you question a lot of things that you never would have questioned otherwise. I think the other thing is that you always hear critics say, oh, bitcoin doesn't do anything. And my favorite blockchain over here, it does these cool things. And like, you know, bitcoin doesn't do anything. But like, that aspect also teaches people a lot, which is kind of like, no, no, no, like, this is a very specific thing for a very specific purpose. Okay? And that, yes, like, you could profit from this over time, but only if you're patient, right? Only if, like, you actually think that, like, this will and, and then that reframes your thinking. And it reframes your thinking because if you are, whether it takes years for you to actually see, see like a return, or whether you, one of these people who experiences massive returns, like the instant that you, that you buy does, then it can then shape people's ideas about what they spend money on and where they're spending, right? Because now when you're, when you're holding these dollars, there is this like sort of psychological thing where like the dollars that you hold are not going up in value over time. And so, you know, there is an argument to be made that this actually raises people's time preference because they're kind of like, look, I live in this inflationary world, like, I might as well buy the car today. Why wait until next year to buy the car? It's just going to be even more expensive and it's not going to be 2% more expensive, but my salary is probably not going to go up by more than 2 or 3%. And so like, I might as well just buy it now. It kind of forces, you know, things into the future. Whereas if you have this alternative, and this alternative is kind of, you know, the value is growing over time, well, then it's really, you know, like, oh, well, do I want to buy that car? Like if this thing is going to be 10 worth 10% more next year and the car is going to be cost 8% more, well, I'd actually be better off like waiting a year, right, to buy this thing. So I think that basically the, my attitude has always been like, the way that it fixes things is actually sort of by realigning incentives. It's very hard in the United States. But like in developing countries, like, it can really help realign the incentives of the central bank because lots of people start opting out. Now you, now there's this constraint that's outside of like the legal system, that's outside of the political system, but that's nonetheless a constraint on their behavior because they can't just inflate, they can't just do whatever that they want to do because people are going to try to escape and there's nothing they could do to stop them. And but in the United States it's a little bit different because I don't think that's the real experience that you're going to get. But in the United States, it's much more about, it forces you to dig in on all these fundamental issues about money, about savings, about privacy, about all kinds of things that like we don't even think about because we've all just kind of grown up in the current system. And I think at the present moment, like, that's actually one of the benefits for bitcoin is. One of the benefits is because so much stuff is broken, people are looking for things that they're looking for off ramps. They're looking for things that help them escape what they see as the problem. They're looking for these kinds of things. But when you. When you start digging into bitcoin, you don't just learn about bitcoin. You learn about lots of these peripheral things that you need to understand. And it's that learning that's actually valuable because not everybody would undertake that learning process if it wasn't for this thing, right? That not everybody would go learn about money if it wasn't for bitcoin. Like, why do they want to read some old stuffy book about, like, why money exists? Or, like, how, you know, people used to use seashells, sells his money or something? Like, no, like, the average person is just not gonna be interested in that. Ask me how I know. I teach economics for a living, right? Okay. Like the intro. The intro students. The intro. Some of the intro students fascinated by this. Some of the intro students are just like, where's this guy going with the seashell thing? Right? So it's not, you know, it's not something that people would do necessarily on their own. And so I think that in that sense, it's a good way to. Of sort of getting people to learn and getting people to think about these big, broader issues because it forces you to wrestle with societal issues that you probably take for granted or that you would just, you know, kind of ignore. But I do think that, like, on an individual level, it can be a difference maker. It can be a difference maker because this is a different vehicle for you to store your wealth over time. And. And so, you know, you have to make a decision about, like, okay, okay, how much of my wealth do I want to put in this thing? Right? But at the same time, the fact that you have that option provides you with a benefit that you didn't have if it didn't exist. And also the other thing, too, is that by learning about it, you also learn why all these other things are scams and to stay away from them. Sometimes you learn that the hard way. Sometimes you just learn that because of. You're just kind of tangentially related to those things. Hopefully you do the second thing, not the first thing. But the thing is, though, is that, that in and of itself though teaches you a lot because a lot of those things teach you about how the financial system works. They teach you about, you know, they teach you a lot about yourself and your own psychology and like what you're trying to do and like. And that there are no like easy solutions out of things. Right. And so I think like all of these different things help to sort of just reorient how you think about the world and just to really reevaluate all of your preconceived notions about the world. And I think that's really the true strength is that everybody sort of goes down that rabbit hole and when they go down that rabbit hole like that starts teaching them about all these things that otherwise they might not have the incentive to even think about or that they just take for granted because it's always been this way and so why would it be any different?
- [90:11]
Walker America
Yeah, hopefully folks take the non shitcoiny path, but sometimes pain is the best teacher in that regard. But Professor, I have kept you for some extra time here so I appreciate you sharing it with me. This was fascinating and I'm sure we could have ranted about communism and socialism and its ills for probably until nightfall at least and then continue the next day. But I really appreciate you sharing the time. This was a great conversation. Where can people find you and anywhere else you want to send folks. Your rebel econ Prof. On X. Anywhere else you want to send people.
- [90:48]
Josh Hendrickson
I'm on Noster. I don't. I don't post very much, but I lurk.
- [90:52]
Walker America
There we go. Okay, we accept lurking and we accept
- [90:55]
Josh Hendrickson
lurking and let's see. I mean I have a. I have a substack which I. Which very, very rarely references bitcoin. It's really just about like just, just how economics can help you to understand the world. Which I write with a friend of mine which is called Economic Forces. We post every Thursday. You can sign up for free if you want. You can also donate if you want. So if you are so inclined you can do that. Other than that, I've got some stuff at bpi. My own website has my academic stuff. I don't know how much people want to dig into to that sort of stuff. But I mean, but that's the other thing is I just. For me like one of the great things about bitcoin is that is the curiosity of bitcoiners and just like how much people just want to talk about this kind of stuff. And for me, you know, I. I'm going to be Honest, right. Like when I first heard about bitcoin, it was a long time ago, I really didn't think that it would turn into anything, but I thought it would be a co thing to watch and observe and kind of just, you know, see how it plays out over time. And it's been way obviously that that was wrong. It's been, it's been much more successful than I ever imagined. And so now I think that, you know, it's fun to, to find like minded people and to find and to just, you know, have these conversations and it's so, um, it's so great to just see people engaging with things that like, you know, as an economist, I've thought were important for a long time but that, you know, typically are not things that, you know, non economists are interested in. But it's kind of cool to see how bitcoin ties into all of those things and brings all these things together.
- [92:50]
Walker America
So amen to that. And yeah, I do encourage people to give you a follow to check out your other work as well, to support the work that you guys do at bpi, which is fantastic. And yeah, and thank you to everybody on Nostr who tuned in. If you saw my note on Nostr about this, the professor's tag is his handle. His NPUB is right in my tag note there. So go check it out and give him a follow. Encourage, encourage our good professor here not to lurk and to engage as well on Noster. But Josh, great to talk to you, man. This was, this was a blast. Really appreciate your time.
- [93:21]
Josh Hendrickson
I really enjoyed it.
- [93:29]
Podcast Host
And that's a wrap on this Bitcoin Talk episode of the Bitcoin Podcast. Remember to subscribe to this podcast wherever you're watching or listening and share it with your friends, family and strangers on the Internet. Find me on noster@primal.net walker and this podcast@primal.netcoin on X, YouTube and Rumble. Just search Walker Walker America and find this podcast on X and Instagram at Titcoin Podcast. Head to the Show Notes to grab sponsor links. Head to substack.com walker America to get episodes emailed to you. And head to bitcoin podcast.net for everything else. Bitcoin is scarce, but podcasts are abundant. So thank you for spending your scarce time listening to the Bitcoin Coin podcast. Until next time, stay free.