Episode 243: "Capitalism's Promise: Essentially Infinite Resources and Human Flourishing" with George Gilder and John Tamny

I'm talking in this episode with the upbeat and visionary George Gilder, one of America's leading economic and technological thinkers, and the author of the groundbreaking books, Wealth and Poverty, Knowledge and Power, The Scandal of Money and now:

Life after Capitalism: The Meaning of Wealth, the Future of the Economy, and the Time Theory of Money

Co-hosting with me is the equally upbeat and contrarian thinker John Tamny, founder of Parkview Institute, editor of RealClearMarkets and author of the recently published The Money Confusion: How Illiteracy About Currencies and Inflation Sets the Stage for a Crypto Revolution"

Life after Capitalism launches a new economic theory. A key theme of the book is that wealth is knowledge and that the difference between our age and the Stone Age is entirely the accumulation of knowledge.

The prevailing "capitalist" theory, conceived by Adam Smith and coined by its enemy Karl Marx, is deeply inconsistent with actual capitalist practice. Karl Marx - and now the cultural Marxists - are dead wrong. Economics is not a zero sum game class struggle for power. Instead, what governs economics and flourishing is human creativity. Innovation and growth are capitalism's infinite promise.

The clash between creativity and power is the central issue of our time. We need to keep front and center the idea that freedom and innovation are humanity's best path of escape from stagnation and tyranny.

Here are just a few of the things we talk about in this episode:

• Most of the way people talk about economics is wrong. Almost all the economic statistics you see in the newspapers are just plain unfounded. They're just projections, arbitrary subjective views, and self-interested inventions.

• Information theory puts it in the proper light. Economics is not an incentive system. It's an information system. Information theory explains the actual foundation of our modern era.

• Humans operate on the learning curve which means that with every doubling of total units sold, costs drop between 20 and 30%. In other words, the natural progress of costs is to drop. The Federal Reserve's idea that the natural condition of life is 2% inflation every year is completely spurious.

• Economists and statisticians disguise the fact that that GNP is wildly overstated for government services and wildly understated for private sector business contributions.

• Free enterprise is driven by the creativity of the human mind and the possibilities of human creativity are essentially infinite. The "surprise" is that the new great inventions always come as a surprise to us.

• One way to understand the economic theory of information is to see how it's been pitted against the politics of fear. Today's world is dominated by the politics of fear. The late Senator Fred Thompson, was asked, "Why didn't you run for president in 2000?" And he said, "I just didn't want to go around the country telling people how bad they had it."

• The prevailing notion that there are magical people in a government office that can protect us from bad things is just wrong.

• The truth is that material resources are essentially infinite. They are not scarce. Humans keep inventing new materials from what was previously thought useless.

• The solution to a Texas sized flotsam of plastic refuse floating in the Pacific Ocean is not to shut down the plastics industry. It's to use it as the raw material for a transformational new material, graphene.

This episode offers up a strong dose of positive reality. Not optimism. Reality. Look around at the super abundance that's been created in the world in the last 250 years. Billions of people have been lifted out of poverty and are living longer healthier lives.

All these good things that are happening will keep happening if we simply keep what are essentially Marxist zero sum "solutions" from getting in the way and instead let freedom and human creativity work its magic.