Solomon Success
Welcome! If this is your first time visiting Jason Hartman's website, please read this page to learn more about what we do here. You may also be interested in receiving updates from our blog via RSS or via email if you prefer. If you have any questions about Christian investing feel free to contact us anytime! Thanks!

The Price of Panic, Infiltrated by Jay W. Richards

Episode:

Guest:

iTunes: Stream Episode

In this episode, Jason Hartman discusses the Covid-19 response with Jay W. Richards. Mr. Richards is an Assistant Research Professor in the Busch School of Business and Fellow of the Institute for Human Ecology at The Catholic University of America. They explore how the panic began, the ‘tyranny of experts,’ and the price brought about by the panic.

Announcer 0:02
Welcome to the Solomon Success Show where we explore the timeless wisdom of King Solomon and the Bible. As it relates to business and investing false prophets and get rich quick schemes are everywhere. Let’s not be distracted by these. Instead, let’s go to the source, the eternal principles that create a life of peace, power, and prosperity. Here’s our host, Jason Hartman.

Jason Hartman 0:40
It’s my pleasure to welcome Jay W. Richards. He is a professor at the Bush School of Business and a fellow of the Institute for Human Ecology at the Catholic University of America. He’s located in the Washington DC area. He’s a senior fellow at the discovery Institute and executive editor of the stream. He is also the creator and executive producer of acclaimed pbs documentaries, the call of the entrepreneur, the birth of freedom, and the privilege planet. He’s the author of several New York Times best selling books, including three that we’re going to try and touch on today. One is the human advantage, the future of American work in the Age of smart machines. You know, we’ve talked a lot about automation over the years. And so we’ll dive into that topic a bit, and infiltrated how to stop the insiders and activists who are exploiting the financial crisis, to control our lives and our fortunes. And the new book, the price of panic, how the tyranny of experts turned a pandemic into a catastrophe. Jay, welcome. How are you? Just fine. Thanks so much for having me, Jason. Good. It’s good to have you. And you’ve got quite a resume. So we’re looking forward to learning some good stuff today. Let’s start maybe with your latest book, the price of panic, and you know, that one is really topical, given what’s going on, you know, whether it be the election, the pandemic, the riots, and you know, the affiliated financial crises. What’s the general thesis of that book?

Jay W. Richards 2:12
The general thesis of the book is that the pandemic of course, and the Coronavirus is a real thing, but that it was made vastly worse, by the way in which we responded to it. And so what happened is, effectively we had a Coronavirus that, for people that are under age 60 is about as dangerous as the flu. If you’re, if you’re just under 20, it’s actually about four times less dangerous than the flu. And it’s more dangerous if you’re over 70. So it was it’s not a historic virus or a historic pandemic. It’s something like the Hong Kong flu of 1968. And yet, it’s the first time in human history that the entire world shut itself down. I mean, just literally, population wide lock downs, which have never been tried before. And that’s why we talk about the price of panic because we think this is a weird convergence of factors in which you have first this idea of population wide lockdown, sort of resting as a hypothesis waiting to be tested. In the public health sort of bureaucracies around the world. You have now that kind of real time access to social media in media, which tends to panic us, unfortunately, and as and then the speculative computer models that made predictions about how deadly the viruses supposed to be, that turned out not to be true. So you have this model of the Imperial College London at the end of March, which claimed the virus is gonna have about 3.4% infection fatality rate. That’s where we got these numbers, about 50 million dead and 2.2 million Americans dead. Well, we knew almost immediately that that was off by orders of magnitude just completely off. Unfortunately, that was what inspired the World Health Organization, the CDC, to order the lockdowns was this prediction. And this actually connects strangely enough to what we’re, you know, the debate over the current election, the public opinion polls in the voter polls, all of which claimed that it was gonna be a Biden sweep, you know, different polls that had an 810 11 points ahead. They’re all based on these speculative computer models, these statistical models, by the

Jason Hartman 4:10
way, at the time of this recording, it’s the day after the election. So

Jay W. Richards 4:14
exactly, you know, we don’t even know the outcome. The one thing we do know is that the polls are way off. That’s the one thing no matter how quite turns out, we know the polls are going to be way off. And the reason is because people imagine a poll is just literally you’ve gotten a representative sample of people, it’s relevantly representative. And so it tells you what people are going to do. In fact, they’re very complex statistical models that are only as good as the assumptions that are plugged into them. And when you’re modeling data are only as good as the people answering the polling the pollsters and

Jason Hartman 4:45
I knew in 2016 a lot of people just wouldn’t admit their Trump. That’s right, because they just know, vilify, they don’t want to be called a racist. These are things used to suppress free speech, those tactics, that the Left users, it’s absolutely appalling. But that’s what it is where we are right?

Jay W. Richards 5:05
No, that’s right. And so any good poll, any model would have taken tried to take account of the so called shy Trump vote. But we knew the pollsters, for the most part just simply ignored that. And so we’ll have another one of these reckonings where everybody says, Okay, we’ve got to do better next time. But I think what we need to do is step back and just apply a little more skepticism about the ability of these complex statistical models embedded with assumptions to really capture reality, I think they tend to be tools for, frankly, controlling the population, whether you’re talking about the pandemic or the election, rather than tools to accurately model reality. And that’s, that’s the problem because we think like the lockdowns happen, more or less because of this belief that these models represented reality. And so it’s as if we’re cut off our heads to get rid of a headache, that would have been a much more focused strategy that would have been much better with fewer consequences if we had focused on the population that was most at risk, and not locked down schoolchildren and everyone else. But unfortunately,

Jason Hartman 6:05
you know, you could argue that it’s actually really hurt that at risk population, because we’ve squandered resources into the general population that didn’t need those resources. And of course, no one has tabulated, you know, I like to talk about you can’t hear the dogs that don’t bark. No one is really tabulated, although a few have mentioned it in passing, you know, the suicides, the depression, the Oh, yeah, you know, the lack of people going to the doctor for a regular checkup, that lead to cancer grow or another disease grow or heart disease grow and, and, you know, those people have suffered or died. You know, there’s, there’s no data on that, right.

Jay W. Richards 6:44
Well, there’s actually, so we did the best that we could in the book, we tried to basically calculate What’s the price of the panic financially and in terms of lives lost. We think at the moment, something like 75,000 that we 75,000 excess deaths of despair in the United States in 2020. So that’s suicide and drug and alcohol overdose 75,000 we think that you know, that’s the kind of general ballpark probably about 80,000 Miss cancer screenings just in that first three months of the lockdowns. Yeah. And so that gives you a sense of the kind of magnitude that very quickly, the just the response, the lockdowns themselves could end up killing more people than are attributed to the Coronavirus. That’s the very definition of a bad

Jason Hartman 7:24
well and also the attribution to Coronavirus is

Jay W. Richards 7:28
fake largely so yeah, it’s very complex, but different string dyeing with the Coronavirus and from it, unfortunately get conflated cases get conflated with mirror positive tests infections, it really is a mess. And so, we wanted to look, we knew we couldn’t stop it. You can’t change the past but we really wanted to try to prevent a lockdown again in 2021, which is what we’re now talking about, unfortunately.

Jason Hartman 7:52
And yeah, and if we see Biden takeover, we’re probably gonna have a lot more lockdowns, you know, let’s talk about coordination and conspiracy for a moment. Obviously, I think we’re all realizing the powers that be have a lot of advantages that have come out of this crisis, like Winston Churchill said, Don’t let a good crisis go to waste. But yeah, exactly. So talk about two sides of the political spectrum right there. But you know, how could they have ever coordinated such a thing? I mean, was it just such a happy opportunity for them? And I say happy in a snarky way. But sure, did did this come around and unlike someone made a call to the who and said, Hey, you got to make this a panic. And and then they, you know, reached out to all these media outlets or started putting out press releases and, you know, started working with the CDC and Fauci to freak everyone out, or what, how would that have happened?

Jay W. Richards 8:56
Yeah, well, and so that was the thing you know, we wanted to try to account for is why exactly did the panic happen? What what would best explain that we don’t think it requires any kind of centralized coordination. But it did require a kind of groupthink among a very small number of people in the public health sort of bureaucracy. The World Health Organization is the UN’s arm for public health, and you’ve got the CDC and you’ve got Dr. Anthony falchi. Here in the US, they all think exactly alike. And then we learned in mid spring that the World Health Organization was frankly carrying water for Beijing for the People’s Republic of China and the authorities there. Then there was this idea of a lockdown as that was a hypothesis there. The way that we responded from time immemorial for with pandemics is quarantines in which you’ve locked down and protected you know, quarantine the people that are sick and try to isolate the people that are high risk. This idea of a general lockdown though in the 2000s. It became this new idea that maybe this would work these population lock downs, though even the World Health Organization in 2019 said there’s no good evidence that they would actually they would actually work, they thought it probably wouldn’t prevent the spread, and it would cause these all this harm. But in March in the middle of the panic, which I really think was a combination of the media’s incentives, which is always to panic us, because that’s more interesting, and people want to click through and you see a scary story. And then the capacity of social media to really magnify and amplify the the panicking effects of the media itself. And so this is, in some ways the first panic since we’ve had this real time access to social media. And so once the pandemic, once a sort of new virus happened, all these pieces were sort of in place to trigger a planetary lockdown, which is what we actually had. But it really I think, more than anything, it’s just, it’s a matter of groupthink, and then what we call the tyranny of experts in which you have a few highly specialized technicians, right scientists with a legitimate expertise in a very narrow field, but they have an unbalanced access to the ears of prime ministers and presidents. And that’s what we think we have to fix in the future. presidents and prime ministers and governors need to be able to get a kind of representative sample of the diversity of opinion among scientists when it comes to these things. So they don’t just think the one guy Dr. Anthony falchi, somehow speaks for science, which is unfortunately what we had happened in this case.

Jason Hartman 11:17
So the tyranny of experts, is that your phrase or has that been used before

Jay W. Richards 11:22
it has been used, it’s not widely used, but the phrase is, it was sort of in circulation. And the basic idea is not the problem is an expertise. Of course, it’s a complex word world, you need people to be experts in specialties. The danger is when somebody who’s a specialized expert in a narrow field ends up with jurisdiction over areas over which he or she has no competence. So Dr. Anthony falchi. Okay, he’s an immunologist. So you know, that’s his expertise. He has absolutely no expertise in analyzing the costs and benefits of a public policy in which you lock the population down. That’s a different expertise. That’s something that you’d want an economist or somebody to analyze. Fauci didn’t understand that and in fact, when he was asked, look, maybe you we don’t want the cure to be worse than disease. So I understand lockdowns will be an inconvenience. Well, this is this is a sign of a very naive person that doesn’t understand that no, when you radically disrupt the economy, you kill people, it actually human lives are at stake. And so it’s always the lines on either side. And that’s the danger is he or Dr. tedros, the director general of the World Health Organization, these guys are not experts in the effects of the policies that they advise. And they just outside that their expertise. They don’t know anything more than anybody else did. And that’s what we call the tyrian of experts, when a few specialists end up making decisions over large numbers of people over which they really have no business. They don’t that’s not what these kinds of experts are for, unfortunately, in this case, rather than being one of 25 experts that would advise a president or prime minister, the media elevated them so that they became it’s like the head the status of these infallible Oracle’s. So there’s Dr. Anthony falchi said something. Well, that was just the sort of thing that nobody could challenge. That’s that’s what changed, I think, in the middle of the crisis is these what would otherwise be kind of obscure experts. Suddenly, are these media figures that nobody can challenge. that’s a that’s a really dangerous thing to have happen.

Jason Hartman 13:15
Yeah, it really is. It really is. But it’s just, yeah. Wow. It’s amazing how this thing played out. It really is amazing. And, you know, you look at a 74 year old man, who is obviously busy and stressed out who got it, right. He was infected with COVID. And obviously, he had good medical care. But he recovered so quickly. It was truly amazing. His name is President Donald Trump.

Jay W. Richards 13:44
And I knew he was honestly he’s robust. Anybody that watches him for 15 minutes knows this.

Jason Hartman 13:49
Wait, he’s stressed his end? He says,

Jay W. Richards 13:53
I know exactly. So those, those criteria thick, okay, he’s really high risk. On the other hand, he’s clearly kind of a force of nature with a lot of energy. Now, there’s no way to know whether the treatment made a difference, or if he would have recovered. Without it, we can’t know. But I honestly I knew at the beginning, I thought, Oh, boy. Okay. He’s gonna be fine. And sure enough, he is.

Jason Hartman 14:14
Yeah, yeah. No, that’s sorry. It’s really something. So where do we go from here on the price of panic? And then let’s switch gears for a moment.

Jay W. Richards 14:22
Yeah, I think where we go from here is, first of all, we need to learn the lessons, we need to learn that we do not want to put our faith in these speculative models that have not been tested against reality models that have gotten tested so that we know the assumptions fit the evidence, that’s fine. But in this case, the the assumptions that were plugged into this original model at the Imperial College London wasn’t really based on anything. And so it should never have been used as a tool for guiding public policy. That’s the first thing and then the second thing is that we need to downgrade the authority of experts like Dr. Fauci so that they’re, frankly the Presidents aren’t being told by one person or effectively President Trump said in April, two very smart people came into my office and told me 2.2 million people will be dead unless we locked down the country. That’s not how it should be. They got that number straight from that computer model. And then two people tell the president something and he has to act upon it that we need to set things up. So there’s a kind of loyal opposition, a body of scientists who are independent of the administrative state who can advise political leaders without the kind of incentives of people that are that are government bureaucrats. Unfortunate And sure, unfortunately, and so Yeah, I agree, honestly, persuading the population that this was a mistake, and we don’t want to do a lockdown again, that’s what I’ve been spending my last few weeks doing just trying to persuade as many people as I can that, look, we do not want to do this again,

Jason Hartman 15:43
you know, there seems to be and I’m going to call it a disease because I think it is a disease, a sort of a psychological disease that I’ve noticed on the left side of the political aisle. And that is this concept of you need an academician for everything, you need a cell, you need a. It’s like I was having this debate with a friend of mine on Facebook, I indulge in these once in a while today. And, you know, she’s telling me that all of these riots are full of, you know, Trump supporters and white supremacists and all this stuff. And she starts posting all these articles about it. And yeah, I’m sure there were like, three of them it those? Sure. Okay, around the country three. And then I simply, you know, I simply search it and find a bunch of pictures. And I’ve already seen these pictures in these videos on every largely left leaning media outlet. It’s no, and I said, you don’t need an article, you just need to use your eyes and your ears, but they were orders have stuck microphones in front of these people. And they’ve spoken in chairs, or in Seattle. And in all these places there. Yeah, I mean, are you going to sit here and tell me that these look like or talk like, these are republicans? You’re gonna believe your lot, believe me or your lying eyes effectively? Yeah, I mean, you know, she’s got a couple of articles. So you know, it’s like, Why do people rely on some bias, study an article or report, a treatise, to talk them out of what is right in front of them? And just common sense. It’s a swell phenomena?

Jay W. Richards 17:25
I know, it’s common sense. Unfortunately, it’s not as common as it should be. Because, you know, we got this in the lead up to the election. I mean, okay, you’ve got these massive rallies that President Trump is doing. Joe Biden is has a heart, you know, has a hard time drawing, drawing crickets. And yet, we’re told that he’s gonna, you know, he’s going to be trumped by 12 points, based upon these speculative models, and we treated that as data, right. But what we’re actually seeing is if it wasn’t data, and that’s honestly I think we need to we need more faith in discernment and and common sense. But there is this kind of tendency to assume Well, again, it’s a form of the tyranny of experts in which I have a study that tells me how this is going to go. And so it has this sort of pretense of knowledge and academic title without its content. Oh, yeah, exactly. Yeah, exactly.

Jason Hartman 18:14
It’s just absolutely crazy. Okay. Let’s switch gears for a moment. And we’ll start wrapping it up here. But I just want to briefly touch on the idea of infiltrated you know, how the insiders and the activists exploit financial crises, to gain control. It’s related to this

Jay W. Richards 18:31
topic. Absolutely. I mean, infiltrated this sort of narrative history of what happened behind the scenes with the financial crisis, because everybody within

Jason Hartman 18:39
the 2008 financial exactly

Jay W. Richards 18:41
the 2008 financial crisis for anybody those that remember it, within two weeks, the media tells us Oh, it was the result of deregulation and capitalism run amok and the free market and all these things. But if you actually look at it, in detail, you realize now, what happened is a series of maybe well meaning government policies, which over that, really decades, destroyed the underwriting standards on loan so that at the time of the crisis, 50% of the mortgages in the mortgage market were subprime or otherwise risky loans. These are loans that could never have been given, you know, 30 or 40 years prior to that they’ve been simply been in Contra, contrary to the law, but there had been actually a political push to give out these these risky loans. And then, of course, Fannie Mae and Freddie Mac, were buying up these loans from private bankers. And so I realized, look, this is actually the result of a series of bad policy decisions. What if not the free market itself in a free market, a banker does not give out a loan unless he thinks you’re going to be able to repay it. So why were banks giving out loans in danger of default? Well, it’s because the system was able to sell the loan upstream, right to someone else. And so this because of that story, though, that it was really the results of the free market. We ended up with even more onerous regulation. So we ended up with a Consumer Financial Protection Bureau right, which gets down even more into the weeds. Yeah, and Dodd Frank Exactly. So these really bad kind of, you know, we get a series of regulations, maybe well meaning that leads to a crisis. And then the crisis becomes a justification for even more government power. Right. So this is the kind of what was the the danger of crony capitalism, as opposed to plain socialism? It looks like it’s free market actors that are doing things. And it’s the kind of governance the government behind the scenes, whereas in socialism, it’s you know, the government directly owns the factories, cronyism, it’s subtler, because the government’s back, they’re controlling a lot of what you’re seeing. But if something goes wrong, they can break blame private industry rather than the policy. I think that’s what government

Jason Hartman 20:40
control, but they get to displace the blame. And I always see this with the social media companies that are government backed, either financially at their startup stage, or they’re backed now by allowing them to lobby and gain favoritism, or as they they return the favor for the government, they squelch free speech, which the government is not allowed to do, but a private company. So no, and they can and the problem with the social media giants, is they also social media companies as proxies for government speech oppression.

Jay W. Richards 21:13
Yeah. And what’s weird is, of course, they have this benefit to so called section 230 of the communications decency act in which the platforms are treated like neutral platforms, so they can’t be sued like a publisher, but then they get to exercise editorial discretion, just like a publisher. And and so I think that’s the way to solve that regulatorily is that they need to decide, okay, you’re going to be a neutral platform, or you’re going to be a publisher right now,

Jason Hartman 21:36
even if they never publish one piece of their own content. They are media outlets, just like CNN and the New York Times and all the rest, and should have liability because they can decide what gets seen and what doesn’t. And that is right before realizing in and of itself. Absolutely. Absolutely. And now my prediction is what’s going to come next is we’re seeing a rush toward digital dollar, digital Yuan, you know, governments are rushing to their own cryptocurrency, which is going to give them incredible control over our lives. And we should do a whole nother show on that. Let’s have you sure. Talk about that, and automation and the future of automation, because I think those are two really important topics. Jay, give out your website.

Jay W. Richards 22:21
Absolutely. So you can check me out actually stream.org where I write frequently, and also my Twitter is that Dr. Jay Richards if you’re not censored, if I’m not censored and sometimes saying I’ll tell you so.

Jason Hartman 22:29
Yeah, well, jack Dorsey is happy to censor anybody he doesn’t agree with so that Jay, thanks so much for fighting the good fight and joining us today. Appreciate it. My pleasure. Great to be with you.

Thank you so much for listening. Please be sure to subscribe so that you don’t miss any episodes. Be sure to check out this shows specific website and our general website heart and Mediacom for appropriate disclaimers and Terms of Service. Remember that guest opinions are their own. And if you require specific legal or tax advice, or advice and any other specialized area, please consult an appropriate professional. And we also very much appreciate you reviewing the show. Please go to iTunes or Stitcher Radio or whatever platform you’re using and write a review for the show we would very much appreciate that. And be sure to make it official and subscribe so you do not miss any episodes. We look forward to seeing you on the next episode.