Economics 101: Your Dollar Is Worth Less Than a Nickel Was in 1913 | Lawrence Reed

Jenny Beth Martin is co-founder of the Tea Party movement and Chairman of Tea Party Patriots Action. She hosts The Jenny Beth Show, which airs Monday through Friday at 1:00 PM ET.Lawrence W. Reed is president emeritus of the Foundation for Economic Education, where he is still full time after twelve years as its president. He was previously president of think tanks in Michigan and Idaho, taught economics at the university level for seven years, and is the author of nine books, most recently Born of Ideas. He has been involved in economics and economics teaching since his twenties. This is the first of four episodes in the show's economics series with him.Key topics:What economics actually is: the study of human action in a world of limited resources and unlimited wantsAdam Smith, The Wealth of Nations in 1776, and why he wrote about the wealth of nations rather than the poverty of nationsMercantilism and the myth that the world's wealth is fixed and can only be divided upA national debt past 40 trillion dollars that is now bigger than everything America produces in a yearTwo trillion dollars more spent this year than taken in, and a trillion of the seven trillion dollar budget going to interest aloneProductive debt against current consumption, and the balanced budget amendment nobody in Washington has thought to proposeGross domestic product explained in plain languageThe invisible hand of the marketplace against the iron fist of governmentThe lockdowns as the clearest test of central planning most Americans have lived throughWhy all action is individual, and what happens when people argue from collective abstractionsTrade-offs, subjective value, the mud pie and the apple pie, and why the labor theory of value failsDiminishing marginal utility, or why the sixth ice cream cone is worth less than the firstLeonard Read's 1958 essay I, Pencil, and the claim that nobody on earth can make a pencil aloneHow prices carry information, and what happened when the Soviet Union abolished themWhale oil to crude oil, with no federal department directing the switchThe dollar worth less than a nickel of what it was when the Federal Reserve began in 1913Competition as the striving for excellence in the service of others for self benefitMonopoly as a government grant of exclusive privilege, and businesses that go to Washington to block competitorsThe proper role of government: night watchman, referee, courts and defenseFree trade, the law of association, the division of labor, and opportunity costProtectionism, the current tariffs, and why Reed says the jury is still outFrederic Bastiat's candlemakers petitioning the king to block out the sunMicroeconomics and macroeconomics, and why you need bothThe Austrian School: Carl Menger, Ludwig von Mises, and F. A. Hayek's 1974 Nobel PrizeTimestamps:00:00 — Cold open: forty trillion in debt, and an economics course in four weeks00:44 — Lawrence Reed joins, and the four-part plan02:26 — Three think tanks and seven years teaching economics03:13 — A definition: human action, limited resources, unlimited wants06:41 — Adam Smith, 1776, and the first comprehensive economics book09:22 — Mercantilism and the myth that wealth is fixed10:53 — Forty trillion in debt, and bigger than what America produces15:53 — Productive debt, and a balanced budget amendment nobody has proposed18:18 — Gross domestic product, explained21:01 — The invisible hand of the market against the iron fist of the king23:17 — The lockdowns as a live experiment in central planning29:11 — All action is individual, and society never ate breakfast34:03 — Government grocery stores in New York36:31 — Trade-offs, subjective value, and the mud pie39:45 — Diminishing marginal utility, or the sixth ice cream cone40:04 — I, Pencil: nobody on earth can make one alone43:12 — Prices carry information, and the Soviets threw it away46:14 — Supply, demand, and the most remarkable force in your life47:56 — High prices are their own cure50:27 — The dollar is worth less than a nickel was in 191352:46 — Medicaid, work requirements, and Nick Shirley on fraud55:50 — It is not only the politicians58:37 — Competition is the striving for excellence01:02:57 — The proper role of government: night watchman and referee01:05:19 — Free trade, the division of labor, and opportunity cost01:10:12 — Protectionism, tariffs, and a jury still out01:16:55 — Bastiat's candlemakers petition the king to block out the sun01:18:30 — Microeconomics and macroeconomics01:20:35 — The Austrian School: Menger, Mises and Hayek01:25:01 — What comes next in the seriesLinks: jennybethshow.com, teapartypatriots.org, fee.org