Thomas Sowell -- Basic Economics

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  • Published on Jan 6, 2011
  • Recorded on December 14, 2010
    Thomas Sowell has studied and taught economics, intellectual history, and social policy at institutions that include Cornell University, UCLA, and Amherst College. Now a senior fellow at the Hoover Institution, Sowell has published more than a dozen books, the latest of which is a revised and updated edition of his classic volume, Basic Economics.
    "Through its various editions," Sowell writes, "the fundamental idea behind Basic Economics remains the same: Learning economics should be as uncomplicated as it is informative." Here, Sowell seeks to uncomplicate some of the economic issues confronting the country today, from the financial crisis and the role of the Fed to the economics of health care and trade imbalances.

Comments • 1 126

  • MIke Walker
    MIke Walker 17 days ago

    Will someone please educate me as to how the hell did Tom Sewell get into Harvart as a high school dropout????? Something is not right with this picture. He's big on empirical evidence, So I would love to see what the statistics of high school dropouts getting into Harvard is.

  • Rew Asad
    Rew Asad Month ago

    Brilliant mind

  • Up On The Hill Ent.
    Up On The Hill Ent. 2 months ago

    it's important not to place too much value on money (the paper currency).
    money is just a unit of exchange ⎯ it isn't REAL.
    it's just pieces of paper & figures on a screen.
    it has no inherent worth.
    the only value it has is the FAITH it is imbued with.
    it is people, not paper, that determine VALUE.
    true, most people chase money because their own character is equivalent to that of a single dollar.
    as an example ⎯ if a person can't read or doesn't even know how to do simple math, they don't have much to offer the greater economy, and are thus as valuable as a printed note.
    VISION and CHARACTER are priceless, and are the integral parts of any successful country's economy.
    anyone can push carts and punch numbers after all, but existential AUTHENTICITY is immortal and invaluable.
    though i myself am not what you would consider to be a by-the-book christian, i still champion it as the one true faith, simply & only because i am an artist.
    the renaissance & enlightenment directly grew out of christianity in all it's forms (post & pre-reformation).
    the works of art from that era remain unparalleled.
    even when contrasted with artists from other parts of the world (asia, arabia, africa, the americas, etc..) at that time, the pieces remain centuries ahead of their contemporaries, both in spirit & realization.
    en.wikipedia.org/wiki/Yahya_ibn_Mahmud_al-Wasiti
    en.wikipedia.org/wiki/Fine_Wind,_Clear_Morning
    no true artisan can tell you with a straight face that jackson pollock's "No. 5, 1948" is equivalent in mastery and skill to raphael's "Scuola Di Atene".
    en.wikipedia.org/wiki/No._5,_1948
    en.wikipedia.org/wiki/The_School_of_Athens
    nor would they deny that michelangelo's "David" is superior in drafting to that of moore's "LH 192".
    en.wikipedia.org/wiki/David_(Michelangelo)
    en.wikipedia.org/wiki/Reclining_Figure_1938
    and don't even get me started on architecture.
    the delicacy & intricacies of those old cathedrals has long since faded into memory.
    what i'm saying is, there's a reason the pyramids & the pantheon are still standing.
    en.wikipedia.org/wiki/Giza_pyramid_complex
    en.wikipedia.org/wiki/Parthenon
    they were built by a people of great VISION and CHARACTER.
    christianity existed long before the bible ⎯ it's not a doctrine, it's a lifestyle.
    it's single resounding message is to ENDURE!
    accept the trial by fire that is life, and you shall be resurrected like the phoenix!
    for through that struggle you become the gold.
    en.wikipedia.org/wiki/Midas
    𝘖𝘣𝘪 𝘋𝘢𝘯
    ©2019

  • Mitch
    Mitch 2 months ago +1

    If the USA was to default on the central banks interest, get rid of the federal reserve and go back to the gold backed dollar what would happen to home values and the stock markets? Anyone ?

  • DEONNA PERRY
    DEONNA PERRY 2 months ago +1

    Here in 2019.

  • CanadianCoin
    CanadianCoin 3 months ago

    When somebody removes cancer what would you replace it with? That's the biggest takeaway. Thank you Dr. Thomas Sowell.

  • Alex S
    Alex S 3 months ago +5

    "Wealth is created when the conditions are such that the people who know how to create it are free to do so"

  • Noah Buddy
    Noah Buddy 3 months ago

    Bullshit. The government is controlled by big special interests. What good is a house if there’s nobody financially able to afford it. The government was doing the real estate industry and its investors a favor by allowing for low income individuals an opportunity to temporarily invest in the fraudulent practices of the banking industry. To say that banks don’t want to loan money to folks who can’t afford is to say that banks would much rather pay indefinite property tax and insurance on something they don’t even own in the first place. Capitalism is a scam.

  • the reap
    the reap 3 months ago +1

    7:23 what a blast!

  • Jp Goonan
    Jp Goonan 4 months ago +1

    I was a nurse in the UK and there were never women having babies in the corridors as a norm due to the bad attitude of the midwife. There might have been the odd one due to staffing shortages but it was anything but the norm. I have a lot of respect for Thomas Sewell but some of the things he says I’d like to ask him about. I live in Australia now. I was born and raised in the Republic of Ireland and witnessed the decline of both those health systems due to mismanagement of funds and stupid rules of political correctness which meant a huge investment in buildings and staff then the collapse as the costs of running such a system outstripped the 2 governments abilities to make revenue from their systems. In Australia though you know not to go to a private hospital as, in an effort to strip services (especially out of hours services) to maximise profits endanger the lives of their patients. Happened in the UK too. So if you want to make health services entirely a private enterprise then expect services to be cut to the bone in the pursuit of profit. I love the Australian system and yes it’s not perfect- no system is but that doesn’t mean that Dr. Sewell’s vision of complete privatisation of the health service is a good idea

  • Thomas
    Thomas 4 months ago

    He's so incredibly disingenuous, this is embarrassing. he actually believes what he's saying too. "If people had kept paying their mortgages..." Does he actually know how *risk* works in the securities sector? The reason they were securitized to be sold was to help mask the inherent risk of subprime mortgages.

  • rick davis
    rick davis 4 months ago

    finally he's wrong, a little bit

  • joe blow
    joe blow 5 months ago

    I understand the theory of QE, but I'm pretty sure several years later, we didn't have inflation. Am I missing something?

  • Daniel B
    Daniel B 5 months ago

    That was 2010. Now, almost 10 years later, I want to hear his update. Does he still hold the same opinion, for example in regard to the economy of China?

  • Ryan Cotten
    Ryan Cotten 5 months ago

    Wrong on healthcare bro. Thought you were intelligent. So disappointing Sowell

  • Стефан Радев
    Стефан Радев 5 months ago +1

    This guy know how the world works better that any other "intellectual" that I know of.

  • Terence Kearns
    Terence Kearns 6 months ago +1

    So Obama reacted the same way as Bush reacted. Both presidents from either side of the political isle, yet the question is about "what governments did". OMG. The question should be, who is powerful enough to make any president bend the knee and do THEIR biddings. And that is the PRIVATELY OWNED Federal Reserve.
    You cannot figure your way out of a paper bag if you want to ignore the elephant in the room which is a privately owned corrupt monetary system that uses usury to enslave people.
    All talks on economics should start and end there, because THAT is what currently drives almost all economies today.

    • Blarghalt
      Blarghalt 6 months ago

      Not that much. As with everything, the US can never truly have an actually government-owned thing, so yeah, the Fed exists as this sort of weird, quasi-state run thing, but for all intents and purposes operates as a central bank.
      What *actually* drives almost all economies right now is capitalism and the pursuit of short-term profit, which is currently also driving us right towards extinction.

  • SuedeStonn
    SuedeStonn 6 months ago

    CLINTON DIDN'T DO SHIT! He just happened to be the POTUS in the middle of the 'Tech Revolution', when PC's and various technology were booming and the economy was supercharged by it. Bush also benefited from it early in his presidency, but by the end of his term the TR was petering out and the economy was taking a hit, and so Bush and Obama had to deal with it (and they both dealt with it poorly). It isn't a mystery that Clinton could raise taxes as tech had provided a huge boost in jobs and revenue and make it look good. For those that weren't paying attention (I just happened to have a glimpse into it as I was in the US Army as a communications soldier and worked with IT on a semi-regular basis) the TR was going to slow down and the surplus of the IT workforce was going to be hit hard. As with everything cuts happen as the workforce is streamlined, workers take on 'multiple hats'/multitask, and you get 'skeleton crews' doing what larger groups used to do.

  • Ian V
    Ian V 6 months ago

    Love this guy but he's dead wrong on healthcare. Opaque market with inelastic demand and no price controls. Only market where you are obligated to buy a product without knowing the cost. In-network, out-of-network, 3rd party billing by outside providers, all kinds of evils due to the market design. It's not as simple as waiting time and quality of care, not nearly.

  • Sheron Evans
    Sheron Evans 6 months ago

    After hearing how globalist and others have been wanting to take us down............that the housing problem back in 2008 was intentionally brought on.

  • Ken Harris
    Ken Harris 6 months ago +2

    I don't think the doctor is Republican or Democrat I think he's just conservative and a critical thinker.

  • Thomas Ryan
    Thomas Ryan 6 months ago

    In Australia we can wait up to 18 months for non emergency medical attention but if it’s fairly urgent it is pretty much straight away but you might get the apprentice surgeon.

  • Lisa Clemens
    Lisa Clemens 6 months ago +16

    Every student, should be required to read Sowell, Basic Ec

  • B
    B 6 months ago +3

    29:08 CallsThe Federal Reserve a "Cancer"

  • Head Nicka In Charge
    Head Nicka In Charge 6 months ago

    So much disinformation here, someone could make a 10 hour video picking out the nonsense he spouts.

  • D'lish Donut
    D'lish Donut 6 months ago

    Sowell thinks George W Bush helped the economy? There goes his credibility

  • Laurent Lorenzo
    Laurent Lorenzo 7 months ago

    Love this but gotta call out misinformation. Having experienced both the French and US medical system, I can confidently say my experience with the US was much much worse. Growing up in France, I never had to wait for a doctor. It has to be said. In fact, I have to wait much much longer here in the US for attention. In France you can even request a doctor to come to your home and can often have it done the same day.

  • gneisenau77
    gneisenau77 7 months ago

    Someone, anyone- please tag Bernie Sanders on here!!!!

  • Alex Kay
    Alex Kay 7 months ago +2

    To watch Alexandria Cortez, Hilary Clinton, Jeremy Corbyn and Bernie Sanders receive plaudits and a platform makes me feel ashamed when men like Sowell, Walter Williams and Milton Friedman are only known to a few. These men carried the torch for the free market and their legacies must remain. Walter Williams said “my definition of social justice is I keep what I earn and you keep what you earn. If you’re owed some of mine, how much and why?”
    I would have paid money to watch Sowell debate and dismantle these socialists with ease... hell he would take them 4vs1 and not even break a sweat. Thomas Sowell you national treasure. You opened my eyes Sir. Thank you.

  • Dan Jakubik
    Dan Jakubik 7 months ago

    Excellent as usual from Thomas Sowell!

  • Emily Rubeo
    Emily Rubeo 7 months ago

    "When you remove the cancer, what do you replace it with?" My exact feelings about government as a whole!

  • NYCSteviewonder
    NYCSteviewonder 7 months ago

    Sowell is a smart guy but I along with the 193 other Keynesians am gonna disapprove of his thoughts on the 08 crisis. Yes, the housing market was a big part of the problem, but CDO's and all that other financialization made a market failure into an entire economic crisis. A housing market can crash, but it took all of America's banks to go insolvent (because housing appreciation couldn't keep pace with interest rates) to put the rest of the economy to a halt.

  • Philip Webb
    Philip Webb 7 months ago +2

    Sowell talks more (un)common sense about economics than anyone I have ever heard. I'm going to have to read his book.

  • Im old As dirt.
    Im old As dirt. 7 months ago

    That sounded like one man who knew the truth and couldn't say it ,and another man who knew the truth and was the reason the other man who knew the truth couldn't say it. I smell B.S.

  • Teŕry Young
    Teŕry Young 8 months ago

    A quote from one of my old friends who when he doesn't know something; he says, 'I don't know Jack Shit about so and so! I feel the same here but the discussion is fresh.

  • jigga jaw
    jigga jaw 8 months ago +1

    It says "Basic Economics" which means every socialist just went screaming from the room, on fire like a vampire in the sun.

  • Niklas Wikstrom
    Niklas Wikstrom 8 months ago +4

    Sowell brilliant as always! The health care example of Sweden is incorrect however; there are plenty of private alternatives to the national health services.

  • Badger Fishinski
    Badger Fishinski 8 months ago +1

    GM is now closing plants... go figure..

  • Badger Fishinski
    Badger Fishinski 8 months ago +1

    The government absolutely messed things up regarding the housing market. ....Sowell is 100% correct.

  • pejoly2
    pejoly2 8 months ago

    This guy is a treasure. Nothing but the truth, no matter how, or where that truth lands.

  • James Campbell
    James Campbell 8 months ago +3

    20:00 minutes of the video: In regards to trade: I agree with the fact that Korea sell's 500,000 cars in America and America only sell's 5000 cars in Korea, that's called the free market. Whoever makes the product that people want to buy deserves it, especially when that Korean car is built in America and made by American workers. But, trade becomes a problem when one country puts a tariff on American cars but their cars don't have tariffs on their cars coming into America. If a Japanese want's to buy an American car they have to pay as much for the tariff as they do the vehicle.

  • Sara Smith
    Sara Smith 8 months ago

    It wasn't some politicians that caused the housing bubble. It was Barney Frank and the democrats during Clinton s administration. They imposed what were called "affordable housing" requirements on Fannie Mae and Freddie Mac in 1992. they made banks give loans to customers who would never have qualified. Bush inherited this and should have ended the program, but the democrats would have made political hay out of it.

  • Ken Mudiaga
    Ken Mudiaga 8 months ago

    Just to point out that GM is now closing factories. As many as 5 plants.

  • The Hound
    The Hound 8 months ago

    Yet 9 years later interest rates are low, and inflation is depressed. Question is, what is causing prices not to rise with all the liquidity in the market?

    • QE oo
      QE oo 8 months ago

      Inflation is higher than reported.
      Why believe gov statistics?
      The low interest rates we see has to rise.
      Interest rates is the most important price and it is being affected by the fed.

    • wickedseymour1
      wickedseymour1 8 months ago

      Slower rates of population growth?

  • Rust belt American Patriot

    Become, President of USA and fix the debt, Taxes and Congress !!

  • donald desrosiers
    donald desrosiers 8 months ago

    blame everybody but yourselfs

  • donald desrosiers
    donald desrosiers 8 months ago

    Pomp decadence luxury entertainment business interests the problem with the economy...

  • ferari oladimeji
    ferari oladimeji 9 months ago

    Can someone help me with solutions to this questions.
    True or False with Short explanation.

    1. The USA is the world's bigest economy, according to PPP- adjusted GDP figure
    2. The Mercantilists view trade as zero- sum game
    3. Absolute advantage theory suggests sountries should import goods other countries produces more cheaply.
    4. According to the Heckscher-Ohlin theorem , car should be produced in the USA rather than in Mexico
    5. When testing the Heckscher-Ohlin theorem in practice, Leontief found that the USA exported labour- intensive products and import capital-intensive products
    6. Estonia's and Finland's close trade partnership could be explained by gravity theory
    7. China economy is shifting from manufacturing to services
    8. Trade tariffs on food tends to be higher than on industrial goods
    9. Due to capacity constraints, trade tariffs are usually lower amng developing countries
    10. The bound tariff is higher than preferential tariffs

    11. Saudi Arabia has the biggest proven oil reserves in the world
    12. The cash i have in my wallet and deposits on my regular bank account are included in the monetary aggregate M1
    13. The economy is believed to have a positive output gap when the potential (long- term average) economic growth
    rate is above the actual economic growth rate
    14. A government should LOOSEN its monetary and/ or fiscal policy when actual economy growth EXCEEDS potential
    (long-term average) economic growth
    15. Bank reserve requirement should be TIGHTENED when economy is experiencing a NEGATIVE output gap
    16. Interest rates should be RAISED when the economy grows well ABOVE its positive (long - term average) growth rate
    17. Monetarists view fiscal policy less effective than monetary policy
    18. Devaluation of one's currency can help to reduce one's trade deficit.
    19. Gold. Silver and other metals are examples of Fiat money

  • Dan Johnson
    Dan Johnson 9 months ago

    6:17 GM did the unthinkable and my GM bonds are now gone. Those are the ones that got nailed and bond holders are supposed to be the first paid.

  • ivan schafeldt
    ivan schafeldt 9 months ago

    banking is theft

  • itsnotatoober
    itsnotatoober 9 months ago

    7:35 the government is so dumb he laughs at them haha

  • Desh 282
    Desh 282 9 months ago

    Thank God there is still sane people in this country!

  • Andrew X
    Andrew X 9 months ago +1

    Although he is a old nice guy, I have to take issue with his assessment of the economic downturn of 2006-2009. The mortgage crisis causes were numerous, and chief among them was that the rating companies gave the mortgage backed securities way too high ratings, inflating their prices. By rating non-prime loans as AAA, buyers were not aware of the risk. Although Sowell is correct that the government did encourage loan companies to give non-prime loans, if the risk of buying these securities based had been properly assessed, the market would not have been as susceptible as it was. Insurance policies against failure would have been more costly and more likely to be able to cover losses. They weren't. Also, collateralized mortgage obligations were unregulated and prone to failure. So in essence, it wasn't government interference that caused the meltdown, but lack of government regulation, lack of SEC oversight, that caused the stock market meltdown. Sorry Thomas.

  • ellisv75
    ellisv75 9 months ago

    Also US dose not have the highest GDP per capita though the "major country" allows for you to define the filed and force it to be true.

  • ellisv75
    ellisv75 9 months ago

    I like Thomas Sowell but he needs to be challenged on some of his assertions, they don't hold up when you bring in data. The US has worse health outcomes controlling for differences in smoking and obesity vs other OECD countries. The issue with Korea is not the number of cars but the fact that their are maximums imposed on US car makers so their is not a true open market between Korea and the US. This is not an interview, no push back.

  • akbar rauf
    akbar rauf 9 months ago +2

    i become a conservative and free market person due to tom sowell.i was a sanders supporter before

    • QE oo
      QE oo 8 months ago +1

      @Andrew X ahahah. Funny guy. Let the government own every thing then.
      The government is so involved in housing, education, healthcare and look how well it is.

    • Andrew X
      Andrew X 9 months ago +1

      You might want to rethink this. Sowell is wrong on so many things. He doesn't understand that it takes government input, things like roads, schools, healthcare, and the military to create an environment for businesses to flourish. This "free market" libertarian bugaboo is hogwash.

  • gerkenator
    gerkenator 11 months ago +2

    I have a lot of catch up reading to do this man is brilliant.

  • Whos Who
    Whos Who 11 months ago

    6:17 GM is no longer the success story

  • TwelfthRoot2
    TwelfthRoot2 11 months ago

    What does Sowell and the Hoover Institute (seeing as they are one and the same) think about Trump’s tariffs?