Speakeasy Economics

Speaker 2

Phil Magnus, the economist.

Speaker 1

Over here at Happy Hour Econ, we value many things. And one of things that that we value is free speech. And I was just wondering, is there an economic impact of free speech? Can somebody make an economic case for free speech? I know I can make a very selfish case for free speech, and that that's what my career is, being able to speak my mind and inquire about things that ⁓ you know might be controversial. But you know, is there, you know, is there an economic case to be made for that?

Speaker 2

I think there is. I think free speech and free markets often go hand in hand historically, and this is not an accident. You know, we live in something that's sometimes referred to as an information economy, and information relies on truthfulness and signals, and it relies on a multitude of voices to engage in discovery, to ⁓ advocate for things, ⁓ to speak out against things. And when you have the government coming in and saying, Well, you can't talk about X. Or if you do something we dislike, we're going to exclude you from the banking sector, or we're going to restrict your broadcast license. ⁓ well, that's an intrusion upon your economic rights as well as your speech rights. And unfortunately, you see some of the worst abuses of history. ⁓ you know, what was all the joke? Whenever there was a socialist or communist revolution, one of the first things they always tried to do was to seize the radio station. And then suddenly it's broadcasting Chairman Mao or Castro or something. proclaiming that ⁓ the Marxist state is upon us. Well, that was all information control. And you think about the other ⁓ the extreme other end of that, well, the radio station is a medium of disseminating information, but it's an economic entity onto itself, whether that's entertainment, news, ⁓ commentary, political commentary in particular, ⁓ it creates part of the environment of debate that I think makes a healthy democracy, but it's also a part of the environment of debate. in information sharing that makes a healthy economy. Yeah.

Speaker 1

Th there is something about living in a time where I mean, right now everybody seemingly has a voice or has a way to get their voice out there. And then looking around and seeing, you know, the iron fist of censorship kind of coming down on people. Especially if if anybody looks across the pond to Europe and the cases of state censorship there it's just mind boggling. And I really do Find myself, you know, often taken for granted just the free speech protections that we have in the United States. But I think something that's easy to do is to think that we've always had it. No, it took us a very long time to get where we are. And sometimes I fear that we could lose it in a flash.

Speaker 2

I think that's an accurate assessment of history. We where we benefit in the United States by the fact that it's hard-coded into our First Amendment. A lot of European com ⁓ countries, they don't have a parallel First Amendment that says the freedom of speech and the freedom of the press shall not be infringed. ⁓ we do. That amendment, at least conceptually, it's always been there, but ⁓ the US government has a long history of violating it to put it mildly. And that actually started early on. You know, Alexander Hamilton in the late seventeen nineties, he shuffled through something called the Alien and Sedition Acts that made it seditious activity to criticize the official foreign policy of the ⁓ of John Adams as president. And you'll hear the records, Adams didn't even really want these laws passed, but Hamilton pushed them through with his friends in Congress because he wanted his competitor newspapers. He wanted his critics in the newspapers to be silenced. So they actually arrested newspaper editors that said mean things about the Federalist Party, ⁓ threw them in jail and said, Well, you're engaged in sedition because this is undermining our national security. And you see this pattern across U.S. history. It happens again during the Civil War. It happens again in really bad ways under Woodrow Wilson in ⁓ World War One, where they ⁓ they basically declare That certain types of speech advocating for peace rather than entry into the war could be classified as seditious, and people are arrested over this. And that's when the Supreme Court really starts ramping up its enforcement of the First Amendment. ⁓ they actually tell Congress and the president, no, you can't do this anymore. You can't just say because they're criticizing our our war effort that they're now an enemy and can be imprisoned. ⁓ so it's taken a lot of court cases over the centuries to really reaffirm and bring the full effects of the First Amendment to fruition. And I think we're in a pretty good state right now, free speech wise, but historically it took a while to get there.

Speaker 1

I'm just trying to imagine being around in the days of Hamilton and Adams and you know, you're arresting newspaper men and them just turning around and be like, We just fought a war, man. Like we we just we just ousted the English and here you are, you know, coming at me, dog. ⁓ we should probably talk about outright state censorship versus private censorship. For example, you know, at any point Phil could kick me off this ⁓ podcast. I'm actually surprised he hasn't yet. But that would be much different than you know, the state coming in and saying, ⁓ Lou Perez has has got to go. Yeah.

Speaker 2

Yeah. So there's this concept in law and it g is kind of colloquially referred to as jawboating. And what it means is imagine you're a a censor with the federal government and you know that if you ⁓ pass a law that says this type of speech is prohibited through Congress, well the Supreme Court will come in and they'll say, No, you can't do that. Pretty much everyone accepts that now. We no longer do the Alien and Sedition Act stuff for the most part. But what if you Get creative and you're a member of Congress and said instead of passing a law directly, I am going to work the back channels and I'm going to convince Google to voluntarily do my censorship for me. Or I'm going to convince this newspaper editor. So some of the other the cases on this, they all predate the internet age, which is why this is so complex as an area of law right now. If you say I'm going to get a private company to do that, because a private company, you know, in the purview of their business, they have the right to say, We're not going to run this editorial or we're going to exclude news that says this certain viewpoint. And you're like, okay, in a competitive marketplace, that means you're censoring news in your your venue. I'm just going to go find a different newspaper or a different website. But what if the website service is something like a search engine? Google and it controls the market share at that point in time. And they say basically, well, any search result for this thing the government doesn't like, we're gonna do this as a favor for a politician, we'll deem it misinformation and we'll de boost it. And that's what happened during the COVID era.

Speaker 1

Before we take a trip down the worst of memory lanes, I mean, even if you look at something as simple as network television versus cable and streaming, there are, you know, still rules in place about what you're allowed to say on network television versus what you're allowed to say on cable. And there was a book that explored why some of the greatest TV shows ever happen to live on HBO and cable versus, you know, network television. And that now that's not to say that some of the greatest shows aren't from network television. TV, I'm I'm partial to shows like Cheers, etcetera. But when you talk about shows like The Sopranos, a six feet under, well yeah, there are a lot of things that the writers of those shows were allowed to do that you were not allowed to do on network television. So I think that's a pretty good example right there of what impact censorship can have just in in popular culture.

Speaker 2

Sure. Well, ⁓ it's like R-rated movies. ⁓ you know, what do you see on ⁓ cable and some of these streaming services? There's a lot more gore and violence, there's a lot more sex, and there's a lot more profanity. ⁓ these things are generally pretty heavily regulated on the public earwaves, and this goes back historically. ⁓ part of it's technology. You know, when they first invented radios, there we actually is a bandwidth problem because bandwidth is a scarce resource just like anything else in economics. And if every random person in their basement sets up their own radio station, well, what happens? ⁓ nobody hears anything because your neighbor's broadcasting at a frequency slightly different from yours. And, you know, you get that static stuff that sometimes you're driving in the middle of a rural part of the country where you're picking up one station that's in Colorado and another station that's in Oklahoma City and they're bouncing off of each other. No, no, like imagine if that. happen nationwide all the time, all over the place, from every random weirdo that has a decides he wants to have a station based in his basement.

Speaker 1

So now everybody has a podcast, but we don't have to worry about bandwidth. We solved We we solved the problem and created a new problem. Yeah. Yeah.

Speaker 2

We solved the problem there.

Speaker 1

When it comes to censorship, do you have any ⁓ personal stories? Because I I have a number of of instances where I experienced censorship on social media platforms. And one of the things that was really just a pain in the ass about social media platforms, especially like years back, you know, say like five, ten years ago, was navigating what was okay on one platform versus another. So I could post something on Facebook that would get censored, taken down. down, but it would be okay on Instagram, or it would be okay on Twitter, or vice versa, or the number of videos that were pulled down from TikTok. For one, it's pretty lame that a man in his forties is on TikTok. I know, I know who I am.

Speaker 2

Everyone's on TikTok now.

Speaker 1

So I had personal run-ins with that and did have an impact on me as far as me second guessing the material that I was that I was doing, not second guessing it like, ⁓ is this good enough? But second guessing, like, I'm gonna spend all this time uploading and doing all the, you know, all the stuff you have to do to get it out there just to have it taken down. Like, ⁓ that's a pain. Because as fun as it is to be a comedian who is quote unquote, you know, censored or canceled, there does come a point where you're like, well, ultimately, I just want to perform. So the more you You're taking performance away from me or taking my material away from me, then I'm really not doing what I want to do. And it's no longer fun being a badass, you know, quote unquote. Yeah.

Speaker 2

So I have several stories to you know, go down to the ⁓ part of memory lane here. ⁓ I have been jawboned before by the government in various ways. And a lot of it happened during the COVID era. You know, I was involved in the Great Barrington Declaration, which was the big anti-lockdown declaration from ⁓ Yeah, massive amounts. It went viral. ⁓ much more that we we I remember the day that we put it up on the web and it was like, yeah, we'll get 10,000 signatures. And then

Speaker 1

⁓ Yeah.

Speaker 2

Within a couple of hours, they're just flooding it, and we've already surpassed that goal, and it's hundreds of thousands of signatures. ⁓ it really did tap into the moment. But the government did not like the ⁓ Great Barrington Declaration. And in fact, Anthony Fauci in particular did not like it. I actually uncovered this through FOIA request, Freedom of Information Act. Myself and Ethan Yang, my ⁓ colleague at the time, we were the ones that got the original, the infamous email where Francis Collins, the director of the NIH. tells Anthony Fauci says, I want a devastating published takedown of these fringe epidemiologists that have just published this anti-lockdown statement. That's kind of strange because, you know, here's a government official saying we want to weigh in on the free speech of scientists and just the general public who to disagree with this policy that we've enacted on the United States and have imposed on people for the past ⁓ six months at that point. So it's them weighing into the free speech debate. But again, they knew they couldn't ban us from issuing the Great Barrington Declaration outright or criticizing lockdowns outright. So what did they do? Is they created this whole theory of misinformation or disinformation policing. ⁓ you start getting offices in the federal government. Joe Biden was really bad about this. He he created a few of them. There was like an office of disinformation where he tried to appoint this ⁓ school.

Speaker 1

Musical theater kit.

Speaker 2

musical theater kid who sang songs about censorship as like the disinformation police. And eventually, you know, that that causes so much controversy that it goes away. But there are multiple examples of this. And they were saying, well, disinformation is a security threat during an emergency and COVID's an emergency. So we as the government need to be curating responsible information. And what they would do is they'd say, instead of banning it outright, we will determine what's responsible or not. And we'll tell Facebook and Twitter and Google and all these social media companies, the actual platforms that media and discussion are occurring on, we'll tell them what the government finds right or wrong. And there are examples that Mark Zuckerberg has admitted, yeah, federal agents called me and said, come in, ⁓ we need you to do or be our police for us. And ⁓ it's not official. We're getting you to do this as a private sector actor. This is textbook jawbone. ⁓ one of the examples I know of from from the Great Barrington Declaration, so we publish it, it goes viral, it's number one on the Google hits. ⁓ all these national newspaper outlets are covering it. And like it's the Wall Street Journal, Fox News, ⁓ Bloomberg, ⁓ things that you'd expect are at the top of the Google list. And then randomly one afternoon, right after Fauci launches his campaign against it. I did a search for the Great Barrington Declaration and the Wall Street Journal is now on like page four of the Google hit. And the very top thing is and I'm not making it up. This is the thing, it's like I think it was called Nafiz's block. And it's Nafees Ahmed, who's this this random conspiracy blogger. He was like a nine eleven truther guy. And he had a conspiracy theory about how the Great Barrington Declaration was the result of the evil corporate interests that were trying to reopen the economy and ⁓ And give us all COVID. It's at the top of the hit. Wall Street Journal and Bloomberg and Fox are on like page four and five. What's going on here? And someone had tinkered with the Google algorithm to make sure that the like only bad news rose to the top. So the craziest of crazy conspiracy blogs is the first hit, and we're way down the list. And then people, some of the authors that were involved in the Great Barrington Declaration, ⁓ Jay Botticeria, who's now our NR NIH chair, he Replaced Fauci and Collins, took their jobs. So there's some justice in that. But he was one of the guys, his Twitter account was suppressed. And they actually found after Elon Musk bought it that he had been shadow banned. ⁓ someone had written into the algorithm: if this guy posts about COVID, make sure nobody sees it, is essentially what it is. Yeah. It wasn't like official law telling Twitter you had to do this, but it was government officials calling Twitter and calling Facebook and Google and these private companies and saying, You know, we we would really like it if ⁓ you privilege the Biden administration's position and everyone else is kind of suppressed. And then it it turns out so this is all really big during COVID. There are all sorts of court cases on it. ⁓ one went to the Supreme Court, the Supreme Court unfortunately they kind of punted on technical issues, but they kicked it back down to the lower courts, and the lower courts eventually reached a settlement where the government had to promise they wouldn't do this anymore. There's another pandemic. But it starts filtering into other things. So the the one where I've really experienced it directly, you know, remember there's this point in the middle of the Biden inflation, stagflationary era, the economy's kind of faltering, inflation's through the roof, the numbers aren't looking very good. This ⁓ report, I think it was like GDP numbers, came out and it was way under what everyone was hoping. ⁓ so it was a very disappointing report. And I posted a comment, I think it was on Facebook or something like that. Saying, well, you know, Biden's numbers, they're not looking good. We might be teetering on the edge of a recession here, or ⁓ might be teetering on the edge of a couple cycles of bad numbers. And, you know, this technically, according to economic conventional wisdom, means that this is a bad sign. But of course, that contradicted the White House's position. And my post, which kind of went viral, got slapped with a one of those little warning label things across the bottom of it. And I'm reading and like, what on earth is going on here? I just made a commentary on

Speaker 1

So it seems like basically given like a scarlet letter. So now that anything that you talk about now gets that extra attention that, you know, or here's Phil the Kook. Just so everybody knows, everything that he's talking about, take with multiple grains of salt. I one thing that that I noticed ⁓ with a lot of creators on YouTube is that they had to change the way they spoke. They had to use many euphemisms ⁓ as opposed to saying what they actually wanted to say, which it harkens back to like, you need to speak in code. They're watching. We should watch out. So what impact did it have on the real world response to? COVID and and what was going on. Yeah.

Speaker 2

⁓ I I think it played a direct part because ⁓ Fauci declared himself Mr. Science. I'm the science. And that meant that you cannot contradict him, because by definition, if you challenge the science, you're engaged in misinformation. But we turn out we we peeked behind the curtains of Anthony Fauci's world. ⁓ you know, Rand Paul just published his his diary that he left on a giant computer server in the federal government.

Speaker 1

Can you imagine being that kind of narcissist that even your company computer

Speaker 2

He's arriving at work every morning, logging it. Dear Diary. Today Julia Roberts sent me a note and said that I'm the most awesome doctor. And I I'm not making this up. This is in there. ⁓ there was another one where he said, ⁓ I advise Trump to do X, Y, and Z on on COVID. And by the way, Joan Baez, you know, the hippie singer lady from the 60s, she sent me a note, says she's gonna keep me in my song or something. It's ⁓ it's all this self-centered narcissistic slop interspersed with ⁓ a view of Fauci's reality. And then in the meantime, you know, I've been filing these FOIA requests against Fauci since 2021. And they still continue to come in. I I actually had one arrive earlier this week, and it's more batches of his emails that have been released. And this guy is a conniver, he's a manipulator behind the scenes. So you remember during the COVID era of the Trump presidency, there was a dissenter on the COVID task force ⁓ named Scott Atlas. ⁓ That he had been brought in to be the alternative voice to argue for the other position. And this new FOIA request to turn up all these emails from Fauci, he's like whispering to Deborah Burks and Jared Kushner, and and he's like calling all of his contacts throughout the White House. He's saying, We got to get rid of this Atlas guy. He's spreading misinformation inside the COVID task force, which was his job to be the one of the scientific ⁓ voices in there. He showed up at the task force meeting and he showed us a study that said lockdowns weren't working. Therefore, he violated the science. He must be suppressed. Fauci would come storming out of these meetings and he'd type off an email that one of his context says, You have to get rid of Atlas. He's crossed the line. And this is going over and over and over again. Fortunately, they like people higher up in the White House are like, ⁓ there's Fauci ranting again. But he is clearly trying to play this game of internal suppression of any scientific dissent.

Speaker 1

So recently he was brought in front of Congress to testify and even though he has been pardoned, retroactively pardoned by ⁓ the previous administration by by President Biden, he pled the fifth to even questions, I believe one question was like, What color is the carpet?

Speaker 2

What color's the carpet in front of you? On the advice of C who declined to answer basics under the Fifth Amendment.

Speaker 1

Counsel, I respectfully based upon my rights. One of the big things that, you know, has come back into the news has been the lab leak theory. And at the time, if you were to even posit that that it could have been ⁓ the result of a lab leak, you were called a racist. I don't know how that one was really ironic because it was like, okay, you're racist for saying that it was made in a lab, but believing that

Speaker 2

one works.

Speaker 1

Chinese people eating bats is the reason why that wasn't that wasn't racist. You know, something like that could get you dinged, could get you kicked off of a platform. But now it it seems like he was talking about that quite a bit with his team. Yeah.

Speaker 2

Privately and and even like editing things and saying, Well, well, he can privately confide it. I think it may have come from a lab. And then a week later he's saying, Yeah, you need to do this study that proves that it did not come from a a lab for political reasons. ⁓ so public fauci private fauci often in tension, as his diary revealed. But I think it highlights, you know, to bring us back to this whole issue of free speech and ⁓ and rights. And the information economy that's attached to it. ⁓ so my friend James Harrigan, he just wrote a little piece for us about some of these new Fauci emails and the diary and everything. And the title of the piece is after 40 years in public service, Fauci finally discovered the Bill of Rights exists because the Fifth Amendment is there. And he's suddenly invoking it all over the place. And you're like, wait a minute, okay, you're claiming cover under the Fifth Amendment, even though you were pardoned and all this stuff. We don't need to get into that. And yet you spent Decades in public office suppressing the First Amendment rights of ordinary Americans. And we know this is true because he did it all the way back to the AIDS crisis in the 1980s. I think he got a lot worse in recent years. COVID was like his wide open pathway to be the censor that he always wanted to be. But ⁓ you know, a guy that is hiding behind the Fifth Amendment had complete disregard for the First Amendment for all of his public service career. And there's a bit of irony in that. There's also a bit of hypocrisy in

Speaker 1

And something that I find When we weren't allowed to have these conversations, it had huge implications for economics, for civil rights. Yeah. But also division within the country. We weren't allowed to talk about this stuff. So if you were a person like yourself, then you were suddenly the enemy for so many people in the country. And it's one of those things where, you know, I I guess I'm I'm really hoping, and maybe I'm naive, that we don't do this again. That if something like this comes up, we understand how diamond.

Speaker 2

One of the great tragedies, it blew up trust in public health. It also blew up trust in academia, which was very aligned with the COVID and public health message of lockdowns are great and wonderful and we must all stay home. And you you see this in surveys, you know. I think when COVID started, people were willing to give Fauci some of their trust. They're like, okay, this guy's trying to seriously solve a problem. But then you start seeing after hit the him being on the news every night. I I noticed it when he was on the news every night for like a week. I was like, I don't trust this guy. There's something weird going on here. ⁓ now we've peeked behind the curtain and seen what ⁓ some of his own materials were, and him contradicting himself in private. ⁓ you know, here's a guy that's purporting to be the repository of all knowledge, claims he has a centralized plan to weather COVID. And then behind the curtains, you you figure out he's just making it up as it he goes along and has no idea what he's doing. It's actually incompetent. And yet Anthony Fauci, or sometimes call him J. Edgar Fauci, ⁓ this 40-year bureaucrat is manipulating the media, manipulating his public messaging in a way that ultimately undermines himself. Now nobody trusts him because he's cried wolf so many times, because he's been caught in lies so many times. And that means next time there's a pandemic, well, people are going to be much more skeptical.

Speaker 1

Well, you guys can trust us over here at Happy HourEcon. Please continue to speak up, speak freely, and listen. We'll see you next week.