Joe Rogan Experience #1145 - Peter Schiff

1. 0:00 – 15:00

   The countdown. …

   1. JRJoe Rogan0:03

      The countdown.

   2. PSPeter Schiff0:04

      Just make it short. So you just-

   3. JRJoe Rogan0:06

      Three, two, one. (snaps fingers) Hello, Peter Schiff.

   4. PSPeter Schiff0:09

      Hello, Joe Rogan.

   5. JRJoe Rogan0:10

      So you just what? Were you gonna, were you gonna ask?

   6. PSPeter Schiff0:12

      (laughs) No, you just did a whole other show before this one.

   7. JRJoe Rogan0:14

      Yeah, I did.

   8. PSPeter Schiff0:15

      Three hours?

   9. JRJoe Rogan0:16

      No, two hours.

   10. PSPeter Schiff0:17

       Oh, all right, so-

   11. JRJoe Rogan0:18

       It wasn't that hard.

   12. PSPeter Schiff0:18

       Oh, okay, well-

   13. JRJoe Rogan0:19

       It was with a comedian. Those are the easy ones.

   14. PSPeter Schiff0:21

       Oh, all right.

   15. JRJoe Rogan0:21

       They're just, it's just basically talking to a friend.

   16. PSPeter Schiff0:24

       Okay. Well, I'm a friend.

   17. JRJoe Rogan0:25

       You are a friend.

   18. PSPeter Schiff0:25

       That's right.

   19. JRJoe Rogan0:26

       Yeah. Uh, I remember when I first saw you, when you were doing that Occu- well, well, is Occupy Wall Street a thing anymore?

   20. PSPeter Schiff0:31

       You-

   21. JRJoe Rogan0:31

       Did they give up? They stop occupying?

   22. PSPeter Schiff0:33

       Yeah, they did. But you know, we just f- maybe you sh- saw that on my YouTube channel. I know we just reposted the Occupy Wall Street video. I never actually had it on my channel.

   23. JRJoe Rogan0:42

       Oh, really?

   24. PSPeter Schiff0:43

       But, 'cause it was originally done by Reason.

   25. JRJoe Rogan0:45

       Oh.

   26. PSPeter Schiff0:45

       And this was about five years ago or so.

   27. JRJoe Rogan0:46

       Yeah.

   28. PSPeter Schiff0:46

       Five, six years ago. And so Reason TV did it, and so I let them promote it on their site. I didn't copy it. And they got millions and millions of views, and there were some other, uh, sites that, that, that went with it.

   29. JRJoe Rogan0:58

       It was Ask a One-Percenter, right? Wasn't that what you called it?

   30. PSPeter Schiff1:01

       Well, I w- I went down-
2. 15:00 – 30:00

   Well, I mean, commercial…

   1. JRJoe Rogan15:00

      What is it?

   2. PSPeter Schiff15:01

      Well, I mean, commercial real estate is expensive, meaning it's in a bubble, but that, you know, that's not gonna cause it. I mean, air's gonna come out of the bubble. I think we would already be in a pretty severe recession now had it not been for Trump winning. Had Hillary won, I think we would already be there. But I think the-

   3. JRJoe Rogan15:17

      What makes you say that?

   4. PSPeter Schiff15:18

      Well, we got a lot of false optimism as a result of, of Trump, and we did get the tax cuts. And the tax cuts, you know, just like, you know, any kinda artificial drug, you know, you can inject yourself and, and, and get a little bit of a phony high. Uh, because remember, the tax cuts were paid for, uh, with debt. We didn't shrink government, right? If you, if you make government smaller, that's great. Then you can cut taxes, 'cause now government doesn't need as much money, and you can, you know, you can relieve the taxpayer of the burden of paying for it, and that's great. But if you just cut taxes but you don't cut government spending, and of course what the Trump administration did was the, was even worse. They increased government spending. We increased welfare spending. We inf- increased warfare spending. Uh, and so spending is more, but they reduced their tax revenue, so the deficits are just exploding outta control. And those deficits are gonna do l- more damage to the economy than the tax cuts or benefit, except you get the benefit first, maybe for the first year, and then you start to deal with the pain after that. And so I think that's gonna set in, uh, you know, long before the end of Trump's term.

   5. JRJoe Rogan16:24

      So you think that th- this is what is causing the economy to be in a really, uh, at least, uh, to, to look like it's in a really healthy state right now?

   6. PSPeter Schiff16:32

      Well, some of the numbers, right? Some of the numbers look better. Um, but beneath the surface, again, it's not improving, just like, just like it wasn't improving under Obama. That's what laid the foundation for Trump's victory, was because Obama and everybody kept talking about how great the recovery was. But the average voter knew that that was all a bunch of nonsense because he wasn't living in, in, in that reality.

   7. JRJoe Rogan16:55

      So if you were the financial advisor to the president, what would you tell him?

   8. PSPeter Schiff17:01

      (laughs)

   9. JRJoe Rogan17:01

      Well, how would you... (laughs) You're laughing now. What would you do to try to keep the economy moving in the same direction? Is it possible to ward off-

   10. PSPeter Schiff17:08

       Well-

   11. JRJoe Rogan17:08

       ... any kind of a crash right now?

   12. PSPeter Schiff17:09

       We don't wanna keep it moving in the same direction. I mean, it's in the same direction it was going in before Trump came in, and that's towards the edge of a cliff. I mean, so what we do, we need is, is, is an about-face. And Trump is not doing that. I mean, the-

   13. JRJoe Rogan17:22

       An about-face, what's, so like for the people that are listening to this that don't understand, like they, they're saying, "Okay, the economy's supposed to be doing well. Uh, black unemployment's the lowest it's ever been. Un- unemployment is down. Uh, all these jobs have been created."

   14. PSPeter Schiff17:37

       Yeah, well remember, again, the unemployment rate is mainly down because so many people that are unemployed are no longer counted as part of the statistics. So, you know, that, that's... If you look at the labor force participation rate, near a record low. I mean, certainly for men, uh, it's the lowest it's been in the history of the republic. Um, but, and look at the, you know, workers to population, so fewer and fewer people are actually working, and more and more of the people who aren't working are not included in the unemployment statistic. So if you backed all those people in, right, able-bodied people who don't have jobs but should be working, then the unemployment rate is much, much higher.

   15. JRJoe Rogan18:14

       Hm.

   16. PSPeter Schiff18:14

       So that, that doesn't really paint a good picture. And then, you know, you look at the fact that so many Americans are s- unqualified, right? There's a lot of jobs out there that go unfilled because American workers aren't qualified to fill those positions because, you know, we, we take a lot of our kids and we keep them in high school until they're 18, 19 years old. Many of these kids should, uh-... drop out of high school and learn a trade. I mean, a lot of people, you know, they don't have the aptitude for, you know, academics. There's no point in just being in high school. A lot of times, they're glorified, uh, daycare centers. But they should be out learning trades, and of course, we make it harder for employers to train people on the job with occupational licensing laws and minimum wage laws, so we destroy a lot of the opportunities for younger kids to get skills. And then, the ones that we send to college, they waste their time, you know, majoring in liberal arts, so they spend four, five, six years in college, learning nothing of any real value in the market. They accumulate a massive amount of debt in the process, and so, you know, we have a labor force that's highly educated in that they've got a bunch of degrees, maybe they didn't learn anything, but they got a piece of paper, but then what they have is a lot of debt. And so we don't have a lot of people qualified to do a lot of the things that need to be done.

   17. JRJoe Rogan19:28

       So, what would you tell the president? If you were, if you, he said, "Look, Peter Schiff, uh, I don't know shit about the economy."

   18. PSPeter Schiff19:34

       Right.

   19. JRJoe Rogan19:34

       "You obviously do." Help me out. How, how do we stop this bubble?

   20. PSPeter Schiff19:38

       Well, I, you know, first of all, you can't stop it, you gotta let it deflate. But the question is, how does it deflate, and then what do you propose is the solution? See, the problem that Trump already made, was when he first got elected, he should not have changed, uh, his perspective. He shouldn't have said, "Hey, everything is great." Right now, he's planning on running ... his next campaign is Keep America Great, right? When Trump ran for office, he said America was in economic wasteland, that it was a disaster. He's been president for a little over a year, all of a sudden it's the greatest economy in the history of the country, which is not even close to being true. But if he's gonna try to run for re-election on, I've already made America great, and now we just wanna keep it great, that's not gonna resonate. So what he should have done from day one is leveled with the American public, again, this is how bad the problem is, and this is what it's gonna take to solve it. Because there's a lot of, you know, um, uh, pain, short-term pain that we're gonna need to go through in order to come to the other side, in order to get rid of all these problems. Like, right now, look at the trade, right? Trump is making a big deal about the trade deficits and he's launching tariffs and he's gonna have this trade war that he's convinced that we could win, and this is very misguided. The trade deficits are not the problem. They are the consequence of the problem. The problem is that we have bad monetary policy, bad fiscal policy, too much regulation. That's why we have a trade deficit, because the American industry is not productive enough. We don't save enough, we don't make the right capital investment. That's because interest rates have been kept too low. You know, our tax code, uh, favors debt, you know, and we have a lot of regulations that make American businesses less competitive. And so the result is that we import a lot of products rather than making them ourselves. And it's not because the other countries aren't fair, or because they have tariffs. Tariffs are very low around the world. I mean, there's, tariffs are not the problem. And so if Trump is simply gonna erect tariffs, all that's gonna do is tax the American public, 'cause the American public has to pay the tariffs whenever they buy imported products. So this is not going to, um, gonna turn the economy around. But, you know, and Trump is right, he points out that, well, you know, at one point in time America ran on tariffs. Which is true. (clears throat) During the 19th century, the government, you know, raised money pre- predominantly by tariffs. But we didn't have an income tax, you know? And so, it, this is the irony of it. The reason we have an income tax today is because the populist politicians of the day told the American voter, "If we can tax the rich with an income tax, then we can get rid of tariffs that the average person is paying." So the average person understood that tariffs cost them money, and the politicians said let's get rid of these tariffs and let's just tax the rich. And the income tax that was originally proposed really was a tax on the very rich. I mean, even doctors and lawyers didn't pay it. I mean, you had to be super rich before you paid the tax, and then it was like, you know, 1% to 4%, so it was a small tax, and it, and it wasn't taken from your paycheck, right? I mean, first of all if you, if you, if you got a paycheck you didn't pay the tax, but we didn't have withholding until 1943. That was part of the, the victory tax to pay for the Second World War. But Americans were told, "Let's tax the rich, and you won't have to, uh, pay tariffs anymore." Well, uh, s- the minute the, you know, the government got the nose under the tent, right, all of a sudden now the income tax affects everybody, right? People pay a lot more in income taxes today than they used to pay in tariffs. But now, now the president wants to bring the tariffs back on top of the income tax. I mean, if Trump wants to repeal the income tax and get rid of it entirely, and then have some tariffs, I'd be okay with that. But you can't do that unless you dramatically shrink the size of government, which is the most important thing that Trump needs to do, but what he's not doing. He has to make the military smaller, not bigger. I mean, he's talking about a Space Force. I mean, we, we can't even afford the Air Force, Navy, Marines that we got now. We don't have any money for a Space Force. But we have to cut everything. We gotta cut entitlements, right? He-

   21. JRJoe Rogan23:53

       But don't you think we should be the first people to have a Space Force?

   22. PSPeter Schiff23:55

       (laughs)

   23. JRJoe Rogan23:55

       What if the Russians come up with a space force?

   24. PSPeter Schiff23:57

       Yeah. No one's gonna come up with a ...

   25. JRJoe Rogan23:58

       They're outta, outta luck.

   26. PSPeter Schiff23:59

       What are, what are they, what are they gonna do with a Space Force? Who we, who we gonna fight in space?

   27. JRJoe Rogan24:02

       Maybe we fight the Russians in space.

   28. PSPeter Schiff24:04

       We won't ... well, why would we fight 'em in space? They're down on Earth.

   29. JRJoe Rogan24:07

       Well, maybe they wanna fight in space. It's more novel.

   30. PSPeter Schiff24:09

       (laughs) Yeah, I don't think, I don't think anybody wants to fight.
3. 30:00 – 45:00

   The people that are…

   1. PSPeter Schiff30:00

      deficits benefit America because the world is subsidizing our standard of living. We're getting to buy things that we otherwise wouldn't be able to have. I mean, without these trade deficits, we wouldn't have all these consumer goods on all these shelves. I mean, people would not be able to buy stuff. Prices would be much higher if we had to make stuff ourselves. By having the Chinese make it, you know, it's a lot cheaper, and plus, you know, it's great for our environment because, you know, we don't have to pollute our own air because the factories are over there. Uh, but in, he, so he's right that it's a problem, but in that...... it's a reflection of the fact that the economy is inefficient, and that's what needs to be addressed. It's like, you know, we have cancer, but you just can't put Band-Aids on the blemishes or something to cover it up. You gotta actually get to the, to the source of those blemishes, which is the, the Federal Reserve and their bad monetary policy, and our government policy, our, our fiscal policy, our regulatory policy. We need to have that type of change, and then the trade deficits will go away. But if we simply try to, uh, put tariffs on, it's just gonna make our own problems worse. All that's gonna do is make prices higher. It's just gonna mean that Americans are gonna have to spend more money buying stuff, and it also actually undermines a lot of American businesses that export into countries that are retaliating. And also, a lot of US businesses, uh, import components and then they assemble the components here, but now those imported parts are gonna be more expensive, and so their net exports are more expensive, and so they become less efficient.

   2. JRJoe Rogan31:28

      The people that are supporting Trump, the people that are happy with the way things are going have be- have said that him lowering taxes for corporations encourages growth.

   3. PSPeter Schiff31:37

      Well-

   4. JRJoe Rogan31:37

      And it encourages ... it, it gets more jobs, and there's, there's more economic activity. Does that make sense?

   5. PSPeter Schiff31:43

      Well, look, if we eliminate taxes, yeah, that'd be great. I mean, the lower taxes are, the better it's gonna be. But not if you borrow the money to pay for the tax cuts. So, the idea is if the government now has to go into the bu- market and borrow money that it no longer collects in taxes, that's gonna have an impact on the economy. That's going to further deplete our savings pool. That's gonna put real upward pressure on interest rates, and obviously the Fed is trying to counteract that. But, you know, the, what they did with the tax code though, they dramatically complicated it. I mean, there's a lot of ... there's a lot more complexity in the code now than there was before. Not like it wasn't complex before. So initially, they talked about simplifying the code. They didn't do that. They, they, they made the, the, the code a lot more complex, and they certainly, you know, they lowered ... they raised ... lowered taxes for some people, but they raised taxes for other people. I mean, depending on what state you in, there are a lot of people now that are gonna pay higher taxes.

   6. JRJoe Rogan32:41

      What ki- What people are doing?

   7. PSPeter Schiff32:42

      Well, people in California, where you got a, you know, you got a 13% income tax in California that's no longer deductible on your state income ta- on your federal income tax. So that's a-

   8. JRJoe Rogan32:51

      Oh, so that, that's a new thing?

   9. PSPeter Schiff32:52

      Well, yeah. I mean, uh, up, up until this year, you, you could deduct your state income tax from your federal income tax, so, you know, you ... the, the, the effective tax rate was, you know, maybe 40% less, because it was just money you would've sent to Washington, so instead you sent it to Sacramento. But basically, the state tax rates are almost double now what they were last year, uh, in i- the, the way it impacts the payer. So there's a big increase in state taxes for individuals.

   10. JRJoe Rogan33:18

       (laughs)

   11. PSPeter Schiff33:18

       You di- you didn't know that?

   12. JRJoe Rogan33:20

       No.

   13. PSPeter Schiff33:20

       Yeah, you know, you oughta ... You know, you oughta move to Puerto Rico with me.

   14. JRJoe Rogan33:23

       I know, but I hear you guys don't have any power.

   15. PSPeter Schiff33:25

       Well, uh, we got power now.

   16. JRJoe Rogan33:27

       Now.

   17. PSPeter Schiff33:27

       But, you know-

   18. JRJoe Rogan33:27

       How many months did it take?

   19. PSPeter Schiff33:28

       Well, it don't ... I have a generator. (laughs)

   20. JRJoe Rogan33:30

       Yeah, but you're the only one. You're like Mad Max out there.

   21. PSPeter Schiff33:33

       No, no, no. No, I'm not.

   22. JRJoe Rogan33:33

       Do you have armed guards?

   23. PSPeter Schiff33:34

       No, no.

   24. JRJoe Rogan33:34

       Standing outside making sure nobody steals your water?

   25. PSPeter Schiff33:37

       No, it's not. It's, you know ... In fact, (laughs) e- eh, we were laughing about it, but you know, w- s- w- ... I was on your show a year ago, right? We talked, we talked a lot about Puerto Rico.

   26. JRJoe Rogan33:45

       It was post-Trump, right? Trump had already won.

   27. PSPeter Schiff33:47

       Yeah, Trump was ... Trump had won.

   28. JRJoe Rogan33:49

       Right.

   29. PSPeter Schiff33:49

       But it was before Maria.

   30. JRJoe Rogan33:51

       Right.
4. 45:00 – 1:00:00

   So they had a…

   1. PSPeter Schiff45:00

      And-

   2. JRJoe Rogan45:00

      So they had a story.

   3. PSPeter Schiff45:01

      Right. And of course, you know, if you're a baker, right? I, I, I don't know what the margins are on wedding cakes, but wedding cakes are probably like the holy grail of cakes, right? I mean, yours- if you're sitting there in the small bakery shop, you're waiting for somebody to call for a wedding cake.

   4. JRJoe Rogan45:14

      Mm-hmm.

   5. PSPeter Schiff45:15

      'Cause those are the biggest cakes you could make, very expensive cakes, so everybody wants to do a wedding cake. Nobody cares whether there's two guys or a guy and a girl on the top of it. You just want to make the money that you're gonna get from baking wedding cake. Now, you come across a guy who just has a strong religious conviction. He just, you know, w- doesn't want to bake a cake for a gay wedding. Okay. I mean, he's the one that's losing. He's losing out on the, the, the, the commission to bake h- the cake. I mean, the gay couple isn't hurt by that. They ... There's so many bakeries that would bake them that cake.

   6. JRJoe Rogan45:49

      But wa- was this couple d- were they denied because of religious reasons? Is that why the people said they weren't, wouldn't make the cake? Like, wh-

   7. PSPeter Schiff45:56

      They, th- yes. They said it was religious reasons, and that's what the Supreme Court, I think, went on religious freedom. But as far as I'm concerned, it doesn't matter what their religion is. Nobody is required to perform a service for somebody else if they don't want to. That's slavery, right?

   8. JRJoe Rogan46:11

      Okay. What if it was, what if it was a Black couple?

   9. PSPeter Schiff46:12

      Yes. I-

   10. JRJoe Rogan46:13

       And what if these people were racist, and what if they said, "We don't wanna bake a cake for a Black couple."

   11. PSPeter Schiff46:17

       Well, then yo- the Black couple can go find a bakery that will bake them a cake. I mean, what's the odds of there being a racist baker out there? But I, you know, I mentioned, if I was-

   12. JRJoe Rogan46:27

       In today's day and age-

   13. PSPeter Schiff46:28

       Yeah.

   14. JRJoe Rogan46:28

       ... it's less than ever before.

   15. PSPeter Schiff46:30

       Right. But let, l- l- look, look. I mean, st-

   16. JRJoe Rogan46:31

       But it's still possible, right?

   17. PSPeter Schiff46:32

       I, I'm Jewish, right? Let's say there's an anti-Semite baker, right? And if he, if I go in there and the guy says, you know, "Oh, I don't wanna bake cake for Jews." Fine. You know, because ... Let's assume that he knows I'm Jewish, he hates Jews, and he spits in the cake. I mean, I'd like to know, like right up front, that this guy who's about to c- bake my cake hates Jews, so then I'll go and buy my cake from somebody who doesn't hate Jews-

   18. JRJoe Rogan46:58

       Mm-hmm.

   19. PSPeter Schiff46:58

       ... 'cause I don't wanna worry about what I'm gonna be putting in my mouth. I mean, why would you wanna even force somebody to bake a cake for you that you've gotta eat if you're forcing them to do it? Or, you know, th- this is all nonsense. But, you know, the, the idea that you can't discriminate, that you can't make choices, right? I, I, I have a right as an individual to, um, you know, to do things that I wanna do, but I can't force somebody else. Rights are about ... The government could ... You can't rob from me and you can't steal from me. So you can't take away from me something that I have. But I can't force you to give me something I don't have. And just because I feel a certain way, like if you go back to the, the, uh, the gay couple, just say, "Okay, you can't discriminate."

   20. JRJoe Rogan47:40

       How did the Supreme Court rule on that, by the way?

   21. PSPeter Schiff47:42

       Well, they, they, they uphold- held the right of this individual, but it wasn't like a, a real-

   22. JRJoe Rogan47:47

       The right of the individual to not sell the cake?

   23. PSPeter Schiff47:48

       To not bake the cake.

   24. JRJoe Rogan47:49

       Yeah.

   25. PSPeter Schiff47:49

       But I think it had to do with some esoteric state law. It wasn't a definitive ruling that says that you have a right to discriminate, which I believe that, I believe you do. I don't think the government should be discriminating, but private individuals. But the point I was about to make is, you know, for, for, for gay. So let's say that you, Joe Rogan, were, um, w- working as a gigolo. That was your job. You just had sex with women and you charged them money.

   26. JRJoe Rogan48:16

       Nice.

   27. PSPeter Schiff48:16

       Right? Yeah, that's your job. Now, what if a dude comes up to you and wants to partake in your services. Do you have to serve him?

   28. JRJoe Rogan48:24

       That's not the job, sir. The job is women.

   29. PSPeter Schiff48:27

       But ... No, no. You can't discriminate.

   30. JRJoe Rogan48:28

       What?
5. 1:00:00 – 1:07:29

   I know what you're…

   1. PSPeter Schiff1:00:00

      you can do to a guy with minimal skills is prevent them from getting a job, because it's the job that's gonna enable them to increase their skills, so they can earn more money in the future.

   2. JRJoe Rogan1:00:09

      I know what you're saying, but the idea is that if you have a minimum amount that you allow people to pay, then at least the people that are working for that company will have a real income where they can pay their bills and feed themselves.

   3. PSPeter Schiff1:00:20

      No.

   4. JRJoe Rogan1:00:20

      And that this company, because they have all the power, they have all the money, and a poor worker who's stepping into the market for the first time or, you know, just hasn't, uh, been, uh, been able to acquire job skills that would allow them to make much more money per hour, that they, they would be taken advantage of by this large corporation.

   5. PSPeter Schiff1:00:38

      Well, you know, the corporations don't have all the power, because they're not the only employer. I mean, all employers compete with one another for labor, and, um, and they, and they bid up wages. I mean, you can't, you know, pay people less than the market value of their labor, because somebody else will hire them.... you know? So, eh, the, the, eh, eh, you could talk about, "Oh, wouldn't it be great if everybody could earn more money?" But-

   6. JRJoe Rogan1:01:01

      Has there ever been a proven example of this, where they've had no minimum wage and it's been-

   7. PSPeter Schiff1:01:06

      Oh.

   8. JRJoe Rogan1:01:06

      ... a financial boom?

   9. PSPeter Schiff1:01:08

      Oh, absolutely. Well, first of all, we didn't always have a minimum wage in the United States. I mean, it, it, it happened really in the 1930s. But you can look at situations of countries that have no minimum wage, and they have very low levels of unemployment, and you can look at areas where the government-

   10. JRJoe Rogan1:01:22

       Like what country is this?

   11. PSPeter Schiff1:01:23

       Well, I mean, you know, they don't have a minimum wage in, in, in Singapore. Um, and, you know, and there are, there are countries that s-

   12. JRJoe Rogan1:01:28

       Isn't Singapore an interesting-

   13. PSPeter Schiff1:01:29

       A lot of them-

   14. JRJoe Rogan1:01:29

       ... example, though? It's an extremely wealthy country, right?

   15. PSPeter Schiff1:01:32

       Well, that's one of the reasons. And they have low-

   16. JRJoe Rogan1:01:34

       Is that why?

   17. PSPeter Schiff1:01:34

       (laughs) Yeah, they don't, they, they, it's, it's very easy to do business. But you can look at examples where the United States has imposed a minimum wage on other countries. I mean, the minimum wage did a lot of damage in Puerto Rico, but, you know, look at another American territory, American Samoa. Right? American Samoa, we basically destroyed American Samoa with our minimum wage. I mean, the, the, the Samoans are, you know, you know, are, are furious about it. This happened years ago, actually. And I, the reason I even found out about it, I was watching 60 Minutes, and they were doing a report about, I think, football players in Samoa. And, um, and during their report, they mentioned that there was like a depression going on in Samoa. And it was like, there was 30% unemployment and really high inflation. And I was like, "What the hell's going on in Samoa?" So, I wanted to research that on my own, and I found out that we imposed the minimum wage on Samoa, and we destroyed all their jobs. Their, their two biggest employers were Tun- uh, Chicken of the Sea and StarKist. They were canning tuna, and then they were shipping the tuna back to the mainland. But the minute they raised the minimum wage, they made the production, uh, uncompetitive, 'cause now you had to pay the higher wages plus the shipping cost to get the tuna back to the mainland. So, they, they, all the canneries shut down, and then it created massive unemployment. And then prices went way up on the island because they no longer had boats coming back and forth to pick up the tuna. So now, all of a sudden, the shipping cost of imports went way up, so they had massive inflation, sky-high unemployment, all because of the minimum wage. So, you, you could look at, you know, m- examples of how minimum wage destroys jobs, uh, you know, right there. Yet, you know, they continue to advocate for these higher wages because it sounds good. "Oh, everybody should earn a decent living." Well, you know, not if you don't have any skills, you can't. And a lot, of course, you know, a lot of kids, you're, you know, they're 16, 17, 18, 19, 20. I mean, people live with their parents still. Uh, the most important thing is getting a job so you can acquire the skills to get a better job, to, you know, to move up the ladder in an organization, to e- enhance your, you know, your value to employers in general. Right?

   18. JRJoe Rogan1:03:34

       And what's the argument against this?

   19. PSPeter Schiff1:03:36

       Against what?

   20. JRJoe Rogan1:03:36

       I mean, I'm sure, um, uh, against what you're saying about minimum wage, against, uh, uh, all of these ideas that you're, you're just proposing. Do you, do you get a lot of pushback? I mean, I'm sure what you're saying, this free market capitalism approach is, it's-

   21. PSPeter Schiff1:03:50

       Mm-hmm.

   22. JRJoe Rogan1:03:50

       You know, there's a lot of people that oppose it.

   23. PSPeter Schiff1:03:51

       Of course. I mean, you know, there's a lot of people that don't think it out, they think with their mind or their, or their, their hearts-

   24. JRJoe Rogan1:03:57

       Emotions, yeah.

   25. PSPeter Schiff1:03:57

       ... rather. And they don't even get the, the re- the origin of the minimum wage was racism. I mean, the first minimum wages here, it was designed to keep, uh, employers from hiring, uh, the Chinese or from hiring Blacks 'cause they, you know, the, that, that's where the minimum wage came from, you know, to try to prevent employers from hiring certain people. So, they said, "Well, let's have a minimum wage, and then, and that will reduce, uh, hiring of people who have less skills." And, and, and so, and the, the labor unions, the biggest supporters of the minimum wage are the labor unions. And none of the labor unions' workers earn the minimum wage. So, you might think, "Why are they, do they so care about the minimum wage if they don't e- if they get paid a lot higher than minimum wage?" And it's because you always have a competition between skilled labor and unskilled labor, right? So, let's say a business, a businessman has the option of hiring a skilled person to do something, and let's say the skilled person is gonna charge $20 an hour, or an unskilled person. And let's say I can hire three unskilled people for $5 an hour, and that equals $15. Well, hey, I'd rather hire the unskilled worker. I can pay three $5 an hour to do the same job of one skilled worker. But now if the skilled worker can, could lobby for a $7 minimum wage, now if I have to hire three unskilled people, it costs $21. Aha! Now all of a sudden, I hire the guy with skills. So, the labor unions benefit by keeping unskilled people unemployed, because they have more skills, and therefore they can, you know, they can get more work.

   26. JRJoe Rogan1:05:27

       That sounds like a complicated mess to me.

   27. PSPeter Schiff1:05:29

       (laughs) Well, it's, uh, it is a mess for the-

   28. JRJoe Rogan1:05:31

       Oh, it is, it's-

   29. PSPeter Schiff1:05:31

       ... for the unh- for the people that get, get priced out of a job, yeah.

   30. JRJoe Rogan1:05:35

       Now, democratic socialism is the thing right now. This is the, you're hearing it all the time. You're hearing it constantly in the news. What, to what do you attribute that? Do you, do you think it's a frustration with, uh-

Episode duration: 2:46:57