Why Certain Societies Succeed And Others Fail with Dr. Richard Rahn

TWS 20 | Why Certain Societies Succeed


Why do certain societies succeed and why do others fail? Former Economic Advisor to President George W. Bush and currently the Chairman of the Institute for Global Economic Growth Dr. Richard Rahn sheds some light on this question as he shares his perspectives on successful and unsuccessful environments.  As an entrepreneur, he lends his understanding of how businesses and people affect economies. He talks about how only a few understand the importance of respecting structures which led to the stagnant growth of their entrepreneurial pursuits.

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Why Certain Societies Succeed And Others Fail with Dr. Richard Rahn

Thank you for tuning in to this episode where we are discussing the theme of entrepreneurship. I hope you have enjoyed and learned a lot from the number of guests that we’ve had this season talking on a variety of topics. I definitely have learned a lot and this is no exception. This is an individual that when I saw him scheduled as a guest, I was excited. It’s someone that I have followed for quite some time and I believe you are going to learn a lot from him. I’m going to introduce him first then talk about what I wanted to get out of the interview, what I was trying to learn from him and I’m hoping that you also are going to learn the same thing or potentially something different.

My guest’s name is Dr. Richard Rahn. He is currently the Chairman of the Institute for Global Economic Growth and is the former Economic Advisor to President George W. Bush and a Vice President and Chief Economist of the United States Chamber of Commerce during the Reagan administration. He’s also a former senior fellow at the Cato Institute and he is consulting and writing for the Washington Times. I met Dr. Rahn several years ago in the country of Belize. I was down there visiting a real estate development of some strategic partners and he happened to be down there as well advising the Belizean government. The group I was with was able to coordinate a dinner with Dr. Rahn.

I still think about that dinner and some of the things that were discussed in relation to Dr. Rahn’s involvement, not just in what Belize was doing, but also a lot of other countries especially in the former Soviet Union, helping to consult with establishing the infrastructure for those countries to thrive. I didn’t know what I didn’t know and back then, that conversation sparked some ideas in my mind and I’ve thought about him and developed more and more respect and admiration for what he has done with his career.

He’s consulted with numerous governments and has truly made a difference. That’s what we get into. The reason why I wanted to bring him on and I’m hoping that you all gain from this is understanding this role of an entrepreneur and the nature of the structure in which they operate. I’ve come to realize that there is these entrepreneurial instinct in most human beings or maybe all human beings. I look at how vital the environment is. He goes into what I would say the hierarchy of the structure of economies, the structure of societies in order for the entrepreneur to thrive. If not, they’re going to leave and the growth of these specific economies or societies will be stifled without the structure.

The reason why I wanted to have him talk about certain things was I believe that there isn’t necessarily a respect for the structure, especially the United States. Very few people have experienced the other side of the spectrum or the lack of a structure in which their entrepreneurial pursuits could take root, take hold and grow. I’d say now, in our day and age, you’ll find that there is a lot of divisiveness with regards to political stances and perspective. This divisiveness, I believe, is creating camps and people are joining camps or aligning with camps without understanding the fundamental reasons behind certain stances on economy.

It’s more that this person believes this way, therefore, I’m not going to give any regard to the structure in which they believe or what they are advocating as the right political or economic environment because they had this name, wear this hat or wear this label. I’m going to discount them completely. I think that’s where we are as American society is we’ve joined these camps more off of emotion than off of reason and logic. I look at going forward and how amazingly entrepreneurial the United States is.

Even though you have an idea of the tax system, if you don't have the rule of law, it still won't work. Click To Tweet

I would say for those of you reading who are US entrepreneurs is to be able to have an understanding of all sides of the spectrum when it comes to the appropriate structure of the economic environment, the political environment and the monetary environment. That we can defend based on principle instead of defending based on rhetoric and talking points. That’s where I believe most people are at now. I look at this conversation as I’m someone who has experienced the pros, the successes of certain structured economies and societies as well as the failures.

I think that within the failure side of things, you learn a lot about what works and what doesn’t. I know we didn’t have a ton of time, but as I researched this interview, watched videos and read articles, especially in the Washington Times where he talks almost every week about these topics. I gained the admiration for how he looks at things and what he’s saying. I think you are going to learn a lot from the show but also learn a lot if you follow Richard and what he is up to. If you’re reading for the first time, we did several months on the theme of entrepreneurship. Previous to that, we did a few months on capitalism.

In 2018, we did seasons on the idea of life, liberty and property as it pertains to one of the more famous quotes and points of John Locke who was a British philosopher. If you like what you’re reading now, definitely go back and read those. We’d love your feedback on the show. If you want to give us some good reviews on iTunes, it would definitely help and if you share the episode with your friends and family would be amazing. You are awesome. You’ve been so supportive and grateful for that support. Let’s go ahead and get to the interview with Dr. Richard Rahn.

Richard, it’s awesome to have a have you on. It’s something I’ve been looking forward to for quite some time now. We met a little more than a couple of years ago. I’ve been intrigued with the work that you’ve done and I’ve been looking forward to asking you some of these questions. Welcome to the show.

Thank you very much. It’s great to see you and be with you.

The thing that has piqued my interest in regard to some conversations we’ve had had in the past is in relation to the perspective you have on successful and unsuccessful economic environments. Why certain societies succeed and why certain societies fail. Maybe start out by telling the audience or teaching the audience some of the universal reasons for these outcomes.

TWS 20 | Why Certain Societies Succeed

The End of Money and the Struggle for Financial Privacy

It’s interesting when you mentioned universal reasons because it is indeed true that if you’re looking at six successful countries, you’ll find them over the globe and you find countries that are failures over the globe. It has nothing to do with nationality or planet or where they’re located on the globe. It has all to do with fundamental policy. We have great success stories, not only the US but Switzerland, Singapore and even Ireland now and places that had very high incomes. Venezuela now is the poster child for a country that is rich. It has the world’s largest oil resources and now is the bottom of economic freedom and incomes have been rapidly dropping for a number of years. The place is impoverished because of policy. When you start off, the key policy is the rule of law and without the rule of law, nothing else works. A lot of us like to talk about taxes and regulations and monetary policy.

Even though you have an idea of the tax system, if you don’t have the rule of law, it still won’t work. Fortunately, the British, when they built the British Empire, there was a lot of downsizing there, but one thing they left around the world was the British legal system, the common law system. Many places it took and worked very well. Each country has adapted it somewhat to its own needs. In other places, it got corrupted and it didn’t work. You and I were in Belize a number of years ago. It’s a prime example of a British territory that was given the rule of law, but they managed to corrupt it and destroy it. Once you have the rule of law, you’ve got to have a competent and honest judiciary to carry it out.

The importance of having honest and competent judges can’t be understated. There is then free markets and socialism doesn’t play and work and we can do mini shows on my why socialism doesn’t work. The importance of having free markets, free trade and taxes that are low on work, saving and investment in capital and labor and underlying economics goings-on. Reasonable regulations in many places include those who are overly regulated. There are a lot of unreasonable regulations. I noticed that a number of the Democratic candidates want to take away my plastic straws and I thought I might even do an article on this that I don’t like drinking through paper straws because it dissolves in the mouth. Some places have these aluminum straws, which are terrible because they’re unsanitary, they break your teeth and other problems.

These stupid little regulations are totally unneeded. Having sound money and by that we need money which is a store of value. The dollar has been imperfect, but it’s been far better than the other world currencies. Get off the gold standard and for all intents and purposes, valor is the world’s standard. Those are the fundamentals. If you don’t follow them, you’re probably going to be poor. If you do follow them, you’re likely to be rich. I’m talking about countries, but it’s also true in people’s private lives. People that play by the rules or honest and work hard tend to do better than those who are trying to find the shortcuts, it usually it doesn’t work out too well.

In my experience, many people don’t have the perspective that you do when it comes to other countries and what they faced as the consequences of not following this hierarchy of universal infrastructure. That’s where you look at a lot of the younger entrepreneurs that have built successful businesses and have become wealthy themselves discount sometimes that infrastructure. Oftentimes, they point to the more socialistic type of structures to essentially help those they consider less fortunate. Do you consider that a slippery slope and why?

It’s naive. A number of countries tried it. People often talk about Sweden being socialist. Sweden’s not a socialist. It had been for about a 30-year-period. Sweden had been very capitalistic from about 1870 until around the 1950s and ‘60s. The social go-getters took over and they nationalized a number of things, but they built a welfare state. They didn’t go overboard with the nationalization. They didn’t go as far as Britain and before Margaret Thatcher, but it didn’t work. Sweden went from the fourth wealthiest in the world to something like seventeenth. The Swedes spent many years ago began to reverse course as Sweden is now much more capitalistic. They still have a big social safety net but when you’re there, everything it was privately owned. They have begun the rule of law. They are quite entrepreneurial.

The dollar has been imperfect, but it's been far better than the other world currencies. Click To Tweet

You can start your own business without problems. They’ve got this social welfare state, which works somewhat in small homogeneous economies. In places like Finland, which is very homogeneous, it works somewhat there. There are still the imperfections, but it doesn’t work in large heterogeneous companies. People always think of this wonderful work, everybody gets along and shares. In reality, it’s not what people do. I think it’s interesting a lot of the very wealthy people in the US who are left-leaning and talk about this thing are also the least generous when it comes to private giving. There was a wonderful book years ago by Arthur Brooks, Who Really Cares, and it turned out that there were much greater donations to greater causes from a lot of what are considered some of the tough guy capitalists than the social liberals.

Do you know that people who you view as the hard-headed businessman give enormous amounts of money to hospitals and all kinds of things and that’s a good way. Particularly in this society, when you get billions of dollars, there’s this sort of pact among a number of the billionaires to give away all the money. How much can any one person spend on themselves? Not that much. Bill Gates stresses the same way we do. Have you ever seen him in a suit? Once in a while. They might have a bit nicer car. The one thing they have is a private jet. This is one thing I like, but for the most part anybody who’s successful they can’t eat more and there’s a maximum size of house you want. They have this test of how far should the bathroom be from the master bed. Because some of these houses were being built that the bathrooms were such as distance from the bedroom that you had quite a trek.

I noticed this has now shrunk back down to a reasonable thing. Most people, particularly as they get older and have to get up in the night or whatever. Kids don’t want to walk 200 feet to the bathroom. The point is there’s an optimum in all kinds of things. When a society becomes sufficiently wealthy, there’s no sense of overdoing anymore. Look at Steve jobs with a t-shirt. The billionaires in Silicon Valley wear t-shirts. A few of them have massive houses, but a lot of them don’t. I live in a fairly affluent community in Northern Virginia and we have a neighborhood pub. I never know if the guy sitting at the next table is a billionaire or runs the neighborhood lawn service. That’s wonderful about the US because it doesn’t matter. We’re all there together and that’s true equality when we all have the quality of opportunity, but not necessarily as a result.

There’s a saying I heard a number of years ago that the secret to living is giving. I was intrigued when a local billionaire to where I’m at passed away a few years ago, Jon Huntsman. He had a chemical company and he was very entrepreneurial. He founded one of the first renowned cancer hospitals and that’s what he said in his biographies. He talked about how he became wealthy because he just learned the satisfaction of giving at a very early time. He realized that the more he grew, the more he could contribute and give. I think that’s something that is very interesting when you look at the Bill & Melinda Gates Foundation and what they’ve been able to accomplish.

I had a bit of a partner and he’s also the senior partner, a guy named Bob Krieble years ago. Bob had invented superglue by the Loctite Corporation. He was a great entrepreneur, but he spent most of the time giving away his money. He used to drive a little Ford Escort around Washington and he’d be up in the CDs and he’d scare me to death the way you drove. I said to him one day, “Bob, why don’t you get yourself a bit bigger car? You can afford it. He said, “The more money I spend on myself, the less money I have to give away.” That was his attitude. I thought, “That’s such an American attitude.”

Look at now where you have Bill Gates is a perfect example where he’s still involved to an extent, but for the most part he’s giving. The impact he’s made on the entire world based on his desire to grow. His vision of having a computer at every home has blessed the world and benefited the world. That’s where I look at. It’s interesting where you have this left-leaning entrepreneurial crowd who in essence wants to delegate that responsibility to government and to distribute wealth through taxation and to take care of those that are less fortunate. I think that’s a very flawed philosophy because the government hasn’t created much. If anything, it’s the entrepreneur. It’s the human being and their ability whether it’s creating things in industry or industries themselves changed the way in which people live. Because in order for them to be wealthy, they have to make lives better for a lot of other people first.

TWS 20 | Why Certain Societies Succeed

Why Certain Societies Succeed: When a society becomes sufficiently wealthy, there’s no sense of overdoing anymore.


In fact, I could argue that Steve Jobs did more to increase the rural standard of living than any human beforehand. With the iPhone and iPad, just of the Apple version, there is like 1.5 billion out there plus all these other versions. For sure anybody on the planet now has it. If you look at the places in Africa, but they all have them and they now do their banking. You’d have a smartphone and you’d have all the world’s knowledge in your hand and things like medical care. Much has stuck you can outsell treatment back. We know that when a typical American comes down with something, the first thing they do is go to WebMD to see how serious it is or whether they could self-treat or they have to go to the doctor.

We look at all the apps that take care of it, things like cameras. I’ve always traveled around the world to go deal with the work I’ve done and I used to take a camera with me, a Rolodex and all these kinds of things. Now, I have everything in my hand all the time. Even poor people around the world have this. That has been enormously empowering and greatly reduced mortality rates and increase this stock of happiness for people. People now know if they have a shortage of something and they know what the world markets are and where surpluses and things are or where shortages are. The markets can arbitrage that over the globe instantaneously. That’s a wonderful innovation and people haven’t thought through of it. It’s one reason we have this apparent worldwide deflation is that the improvements in technology had been so fast that they’ve in certain ways overwhelmed the ability of the government to inflate the currency, which is bizarre.

Interestingly enough, that’s where I wanted to go next. Maybe not specifically to currency, but to maybe the belief systems that you are seeing in the US and American society that may not be in line with what we’ve been talking about. I believe these universal truths are evident in a lot of different respects, a lot of different successful societies. In our day and age, I see a lot of fragileness associated with the markets with interest rates. It starts with the American Society’s belief system or perspective when it comes to how things should operate. What would you say are maybe some of those fragile points that you see that American society is adopting as their belief system?

The biggest problem and you alluded to it is that people don’t understand how the system works and you got a lot of these young entrepreneurs who became rich. They don’t understand why they became rich and how they could do that in the US, but they couldn’t do it in Venezuela. They have the same person. It’s the same genetic structure. This can come from a good family in both countries and in one place, you’re stuck. You have to get out. There was no way to do anything. Then they can come to the US and do most everything. Many years ago, I was very much involved in the economic transition in Eastern Europe and the former Soviet Union. What struck me is when I started working in these countries are all these very smart young entrepreneurial people, but they couldn’t do anything in their own country. They had to get out and then came to the US or Europe or other places, but particularly come into the US.

Particularly, I have worked in Bulgaria and Bulgaria now is a great free-market country. I noticed that the index of economic freedom it’s in the top quintile now. Years ago, it wasn’t. For a Bulgarian to succeed, it was much easier to leave the country. You had all these young Bulgarians who would come to the US and get an education. I used to say, “Why don’t you go back to Bulgaria and help the country?” They say, “It’s hopeless. I’ll stay here.” A lot of them became quite wealthy, some of them who worked for me. I realized that they made the right decision and then Bulgaria changed. They’re the first ones to put a 10% flat tax in and they have a lot of crushes, but they’ve gotten rid of much of it. It is a remarkably different place now because they started adopting the rules that worked in every place. We take Chile. Chile I think is now the 30th freest country in the world. Many years ago, it was a Marxist dictatorship.

It was horrible. It was a communist country. It hadn’t been that long that a guy named Allende who was in his time a dictator, he was overthrown. It took them a number of years to get a democratic government, but they started the economic reform quite early. Now you go to Chile, San Diego and it reminds me so much the way California used to be before California went downhill. It’s beautiful. It’s got the same climate. San Diego is like Southern California. The mountains come up in the sea and beautiful beaches and it’s gorgeous. The vineyards grow almost everything. You’ll see that change for a country was a poor Marxist dictatorship and now is the wealthiest country in South America. It’s the same people and the only thing that’s different is the systems.

True equality is when we all have the equality of opportunity. Click To Tweet

What I find fascinating is polarity oftentimes gives you a different perspective when you’ve experienced what it’s like to have a dictatorship. I think the value that’s placed on freedom is so much greater. I look at how I characterize the perspective of the United States is we don’t have polarity. We’ve had freedom, we’ve had success and we’ve had an infrastructure for so long that people have discounted its nature. Subsequently now, our questioning is nature. Do you see the same thing or maybe something different?

I think you put your finger on it. We look at what’s happening in Hong Kong. The people who are the citizens of Hong Kong, most of them are the descendants of people who came over in the late ‘40s or 1950s from China. If they didn’t directly experience Communism, their parents or grandparents did. They know what it’s all about. You don’t have to explain it to them and you look at how they’re risking everything. They are unarmed and every weekend and every night they go out there and are protesting what may seem like fairly minor issues, but they’re not because they understand that once they start to lose some of these things, there is a slippery slope. They’ll end up looking like China rather than Hong Kong. You can see that they don’t want to go back and I worry about the situation, but the facts that these people have this courage without any weapons or anything. They go out there and confront the authorities night after night and demand to keep the freedoms that were given to them on the basic agreement between the British and Chinese 50-year agreement.

The fighting comes from that understanding of what it’s like to have the opposite and their neighbor is China. If you look at with regards to one of those universal fundamentals, I know that you have some experience here which is a currency, a sound monetary system. I look at what’s going on in our country and we’ve benefited from so much yet at the same time, there’s a great cause for concern with the deficit spending with the future obligations of Medicare and Social Security and the way in which that is operating. You had some communications with a lot of the Silicon Valley folks that were looking at internal payment systems associated with cryptocurrency or blockchain and figuring out new ways in order to make exchanges. It would not only create more efficiency with exchange but would ultimately reduce the central influence and power around that type of exchange. Do you mind speaking to that?

Central Banks are relatively recent phenomena. They are going to be a short-lived phenomenon. From about 1870 to 1914, the world was on the gold standard, which is the great error of monetary stability around the world because all the major countries were on the gold standard. Nobody could control the price of money, there are supply and demand. It worked extremely well. There were no exchange fees between countries because an analysis of gold in London was the same as New York or Tokyo or wherever. That worked well and the reason it fell apart is that when they went in World War I, the countries needed to borrow a whole lot to engage in war. None of the gold sends you’ve limited to how much should you borrow and we should have constrained war. In fact, it destroyed the money engaged in the war.

We look now and we have these they call fiat currencies. The US dollar has backing and the US dollar is the world’s currency. The backing the US dollar has is the ability of the government to tax, take real resources. Take things that have real value that we all own. Take them to the point of a gun and seize them. They try to manage the value of the dollar. We see they can do this less and less well. The open market operations. Some of your readers learned about some of the tools and most of these tools are less potent than they used to be and are hardly used anymore. I should back up, I was a great fan of FA Hayek, the great Nobel Prize economist-philosopher. In 1976, he wrote a book called Denationalization of Money.

I was a young economist at the time and I was fascinated by the book and I was an advisor to one of my exchanges at the time in Austin. I thought, “He’s nailed it, but mechanically it’s hard to do.” This would be before the modern computer digital age. I wrote a lot about it and played with it to how we could do it. In 1998, I wrote a book called The End of Money looking at digital money and so forth. Eventually, several years ago, the blockchain came along with Bitcoin in the early cyber purchases. The question is where does all of this lead? To start with the basic goal would be to have a worldwide monetary standard which would make trade and investment very easy around the world with these big fluctuating exchange rates.

TWS 20 | Why Certain Societies Succeed

Why Certain Societies Succeed: Central Banks are relatively recent phenomena, and they are going to be a short-lived phenomenon.


Think if you are a German chemical manufacturer. The price of the euro that the Germans use goes up and down considerably against the dollar. Do you put your plants in Louisiana? Do you put it in Hamburg, Germany? Do you put it someplace else? If you make a mistake because you’ve misgauged what the exchange rate would be and nobody knows this for certain. This can be extremely costly too. You can have windfalls or often great penalties. If you had a constant currency throughout the world that everybody used, that problem goes away. A lot of these investment decisions, which are almost difficult to make, disappear and you’ll put your money where it makes the most sense given raw materials in markets and so forth. That is a great promise of the cryptocurrency digital age.

You have then a debate of, “What should be high-end with cryptocurrency?” With Bitcoin, there’s nothing better than a computer algorithm. They kept a scarcity by the system they have and you have to mine the new ones that have increased costs. They have limits. It’s $21 million. There’s nothing real there. Someday somebody will figure out how to hack it. Nobody has to date, but things can go wrong or you have a meltdown of the rural electronic system for some period of time. It won’t be permanent and you see these science-fiction things and not all of them are still science fiction of the electrical grids going down and so forth. If a currency has nothing more than a computer algorithm behind it, you’ll have many more problems that I think are necessary. A lot of people recognize this problem. They’re trying to do cryptocurrencies, but have real backing like with gold or silver, the traditional precious metals.

These are heavily-regulated and I’ve argued that you can use almost any standard commodity, things in trade and organized futures market around the world. We had the standards for a long while. I have a few others who had created a company which we are willing to an aluminum-backed cryptocurrency. That may sound ridiculous because aluminum is inexpensive. It is found everywhere, but it has a number of great advantages. It’s never going to be worth zero. We’re not talking about carrying around aluminum foil in your pocket. The goal is an important flag to carry around. Digitally, she would have stored at any place and still trade and still use it. I think this is the way we’re moving and I had been putting my money and time where my mouth is on the whole thing. It’ll be interesting to see how this works out. When you’ve got a thousand different experiments around the world this time or at any given time.

Richard, one of the conversations we had when we were in Belize was around an idea that you had regarding how to essentially create some sort of ETF or fund around the natural resources of Belize and what that could potentially do to back their currency. It sounds in a similar way what you’re talking about, having something that backs a cryptocurrency.

What I was talking about there was a standard currency board. I used to be on the board when I came out on monetary authority and I’ve got a currency board there where the Cayman dollars fixed the US dollar. Those of us who are on the board, we managed that. It’s easy to have a fixed exchange rate. Years beforehand, I had done some work in Estonia and they had a number of natural resources. The Estonians were trying to figure out how to establish new money and they had some gold in the Bank of England and in New York. They had a lot of timber, oil, shale and so forth.

They were able to put together a currency board which gave total backing for currency. It wasn’t a cryptocurrency, it’s was normal currency at the time. The currency boards I have been, a lot of them is set up in Eastern Europe, the former economist countries. They worked very well for mid-sized countries because they get monetary production outside the political process. Bulgaria has got one and it’s affixed in euro. Bulgaria can inflate as well and have problems. Bulgaria has a very good fiscal policy. Before they had the currency board, they went through a couple of episodes of hyperinflation. Back when I shared the transition project back in 1990, I argued for the courtesy board then they had to go through these bouts of inflation. I got a call one day and said, “Richard, you knew that idea you had for a currency board.” The paper was ready. That is in 1997 and it has worked well since.

If a currency has nothing more than a computer algorithm behind it, you'll have many more problems that are unnecessary. Click To Tweet

That’s the polarity idea. Where ideas and solutions could be valid but if that’s the only thing that a person sees, then it may not be relevant at the time. When they go through some sort of a crisis and experience not having it or something that could have prevented it, that’s when they value it more. That’s I would say one of the last things we can talk about before the end of this fascinating conversation. Where do we stand with the fragile nature of potentially in America and what we experience? I know we have a lot of strength in so many different areas, but do you look at where we’re at as a society and identify one part of it or a couple of parts of it that are more fragile than others.

Yes. The most fragile part is this notion of getting stuff for free and the idea that you can have free medical care and free pensions and so forth. These don’t have to be actuarially sound. That always ends up a disaster. Every place in the world is a separate tribe. It’s like these people, Madison did these debates. It’s like, “People have read no history.” It’s quite astounding to me that they think they can do this. There are some crazy things as Bernie Sanders comes out. It’s like the Soviet Union and all of the other places never existed or maybe in his mind may have worked perfectly.

For those of us who’ve been there, “No, that’s true.” It impoverished everybody. We look at Social Security. We have to make adjustments to the system as we age as a society. When Social Security was first developed in the 1930s, there were about twelve working in Americas for each person’s Social Security. Now we have about three. That at racial continued to decline as people start living to commonplace to 100, 110, 120 or whatever. We can’t have people retire for half their lives and have a good retirement income.

Somebody has to be doing the work. He said, “We’ll increase the taxes,” but the more you increase taxes, that discourages work. You get out of yourself on these treadmills and it’s a formula for disaster. We’re seeing it play out in places in Europe and Japan and other places and in worse shape than the US. In the last few years, we saw it play out in Greece and the average Greek has a per capita income of about 30% less than they did a few years ago. That’s a huge drop in the standard of living and the idea is that we’re going to spend money if they weren’t earning and you can only do that up to a point. At some point, people say, “I’m not going to loan to you anymore.” When that happens, the game is over and that’s what I fear in this country. On the socialized health systems, we’ve seen plenty of those around the world and you tend to get inferior care, queuing and then you always end up with two sets.

I look at it in all the places. There is a medical system for people in welfare willing to pay for their own. They have decent hospitals and state of the art and then there’s the medical care for everybody else’s free. It’s like the VA system. Do you want to go there? One of the great changes the Trump administration made it is now the VA have a choice to either to the VA or go to your own doctor. They call the VA and they say, “We can’t see you for a few months. You can go to your own doctor.” They send the bill over to the VA.

TWS 20 | Why Certain Societies Succeed

Why Certain Societies Succeed: We have to make adjustments to the system as we age as a society.


I refer to what’s going on sometimes as psychological warfare because it seems that rational thinking has been thrown out the door and its demagoguery and rhetoric that has taken over. It’s the hot buttons. It’s the trigger buttons that ultimately get people to react emotionally. When that exists, you throw rationale at the window because history has shown what some of the things that are being proposed have done to societies. Yet history and reason have nothing to do with the conversation anymore it seems.

I thank you for giving me an opportunity to speak to your audience.

You’re still active and you are still writing. Why don’t you tell people about what you’re doing with the Washington Times and other ways in which people can follow you and keep up to speed with what you’re talking about?

I do a column which is published each week in the Washington Times. You can find on the Washington Times website or the InstituteForGlobalEconomicGrowth.orgI. I think you’ve got all the information on that and it appears in a lot of other places. If you Google my name, you’ll find me on Twitter and Facebook. You’ll find 2,000 columns by me and my ideas on the week.

Richard, it has been a pleasure. Thank you so much for your time. It’s been an awesome conversation. I appreciate it. I’ve learned a lot.

Thank you.

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About Richard W. Rahn

TWS 20 | Why Certain Societies SucceedRichard W. Rahn is an economist, syndicated columnist, and entrepreneur. Currently, he is Chairman of Improbable Success Productions, the Institute for Global Economic Growth, and Metal Convertibility LLC. He writes a syndicated weekly economic column which is published in The Washington Times, Real Clear Markets and many other places, and serves on the editorial board of the Cayman Financial Review.

Previously, he served: as the Vice President and Chief Economist of the Chamber of Commerce of the United States; as a representative of the United States Information Agency in a number of countries; as the Executive Director of the American Council for Capital Formation; as a member of the Board of Directors of the Cayman Islands Monetary Authority; as the U.S. co-chairman of the Bulgarian Economic Growth and Transition Project (1990-91); as a member of the Quadrennial Social Security Advisory Council (appointed by President Reagan in 1982); and as an economic advisor to President G.H.W. Bush (in 1988-1989). In 1990, he founded the Novecon companies, which included Novecon Financial Ltd., Novecopter, and Sterling Semiconductor (now owned by Dow Corning). He has taught in graduate schools at several universities, and for the U.S. Air Force.

He is a member of the Mont Pelerin Society and has served as a senior fellow at the Cato Institute, the Hudson Institute, and the Discovery Institute; and a visiting fellow at the Heritage Foundation. He has written more than a thousand articles for newspaper, magazines and professional journals, such as the Wall Street Journal, USA Today, Forbes, The American Spectator, The Weekly Standard, National Review, and The National Interest. As an economic commentator, he has appeared on such programs as the Today Show, Good Morning America, Kudlow and Co., Wall Street Week, the PBS Newshour and Crossfire, and was a weekly commentator for Radio America.

He has testified before the U.S. Congress on economic issues more than seventy-five times. He earned a Ph.D. from Columbia University and was awarded an honorary Doctor of Laws by Pepperdine University. In 2018, Dr. Rahn was a recipient of the annual Hayek Lifetime Achievement Award.

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A Conversation Around Politics, Entrepreneurship, And The Dynamics Of Capitalism with Peter Wehner

TWS 14 | Dynamics Of Capitalism


Capitalism is the greatest economic system in human history because it’s lifted more people out of poverty than any system in human history and allowed for the conditions for great human flourishing and great technological advancements. This is according to Peter Wehner, a New York Times contributing Op-Ed writer covering American politics and conservative thought and a popular media commentator on politics. Wehner is also a veteran of three White House administrations and author of the books Wealth and Justice, The Morality of Democratic Capitalism, and The Death of Politics. In this episode, he dives into the aspects and dynamics of capitalism.

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A Conversation Around Politics, Entrepreneurship, And The Dynamics Of Capitalism with Peter Wehner

My guest is incredible. Probably the best top three interviews I’ve had. We are talking about entrepreneurship, but we also weave in capitalism. We talk about a lot of what the theme was in 2018, life, liberty and property. It was awesome to talk to this individual. He is super intelligent and very distinguished. Peter Wehner is my guest and he is a Senior Fellow at the Ethics and Public Policy Center. He also is a contributing editor at the Atlantic Magazine. He is also a contributing columnist for the New York Times. He is the former Director of the White House Office of Strategic Initiatives and Senior Advisor to President George W. Bush. He has authored a few books, Wealth and Justice: The Morality of Democratic Capitalism and The Death of Politics. Welcome, Peter. It is amazing to have you on. I’m excited about this conversation and to talk to you about your book as well as some of the things that you’ve been preaching.

Thanks for having me on. It’s a pleasure to be with you.

I talked to you a little bit about what we’ve been doing, which is focusing on the topics that include life, liberty, property from some of John Locke’s writings. As well as what capitalism is, entrepreneurship, and the framework where most people want to be a part of. Not necessarily just in the US but around the world. I look at what you’ve written about and understood it for quite some time studying and looking at where our society is and what has made us successful versus other nations perhaps. How have you come to understand capitalism in general and the aspects and dynamics of capitalism?

My belief is that capitalism is the greatest economic system in human history because it has lifted more people out of poverty than any system in human history and allowed for the conditions for great human flourishing and great technological advancements. Capitalism unmitigated and unrestrained has some problems. Part of what democracies and free societies have to do is to soften some of the rougher edges of that. That’s a prudential judgment. What does that mean? What programs have to be done to do that? You have to weigh the costs and benefits in terms of the effects on economic growth and all the rest.

It’s my belief that capitalism works because it’s most consistent with human nature. I’m a big believer in the idea that you have to confirm your economic and political systems to certain realities about human nature. I think capitalism accords to that and aligns with that. It understands as Adam Smith talked about what selfishness rightly understood is. You have to take into account what drives and motivates people that you can’t believe simply altruism, even though altruism is a part of human life and human experience. People act in ways that advance their self-interest rightly understood. You have to create certain incentives that will lead human beings to act in the ways that are both expected of them but also advances the common good.

I think the American understanding of capitalism, by and large, is the right one. Limited government entrepreneurship, free markets, skepticism about the ability of the centralized government to dictate decisions and believe that it has the capacity to anticipate and direct all aspects of human life. It has improved and right. There’s an epistemological modesty that capitalism understands, which is that you can’t get a small group of very bright people who can run economies. The way that economies work best is letting people by and large to be free to act in ways that want to act.

Let me go into two things that you had said because I find this interesting. It sounds like there’s this altruistic pull of human beings to be charitable to help others, to contribute, give back. There’s also this invisible hand, maybe more self-interested. It seems like those two things are pulling against each other. Are they mutually exclusive or is it may be a mischaracterization of those two concepts?

I don’t think of them as mutually exclusive. I think that they can be complementary. They’re distinct and they’re part of human nature. Think about your own life, the lives of your friends and your family, you probably see both of those elements in them. There are times in which you see altruism, self-sacrifice, selflessness, acts of charity, sympathy and compassion. Those things are real and they exist. They should be encouraged where they can. On the other hand, all of us act in our self-interest as well. That’s the way we’re designed. That’s the way that we operate. Most of life is acting in our self-interest provided that it doesn’t run over the rights of other people, and none of us are completely selfless, self-giving, completely compassionate and completely sympathetic. You have to take that into account.

The way that economies work best is by letting people be free to act in ways that they want to act. Click To Tweet

That’s not a bad thing as long as it’s channeled in the right way. The trick here is to try and take those human realities and direct them in a way that advances the common good. The founders understood this. Their view of human nature was correct, which is that people are capable of virtue and nobility but also acts of recklessness, irresponsibility and evil. You have to take both of those things into account. My own sense, I’m a person of the Christian faith. The Christian understanding of human nature is essentially correct. It’s that too, which is the advice and virtue are intermingled in people’s lives and in people’s hearts. It’s a complicated mix. People in different seasons in life lean in more of one direction than another. The challenge in individual lives, as well as a society, is to try and emphasize, give force and power to the higher things and to mitigate the lower things.

I do want to hit on a few of the things you said. Go to this idea of central powers dictating what people should do or taking care of them is the banner sometimes in which central governances is looked to as a virtue. What is it about that structure that people don’t end up liking? The ideal side of things that they push through or talk about sometimes is intriguing. I see why they would appeal to people, but when it comes down to it, why do people kick against that? Why does that impede human progress or does it?

Let’s take facts and circumstances. Sometimes when the centralized government, the national government who’s acted is advanced, great good, and sometimes, often it’s done the opposite. I’m somebody who believes in limited government and is wary of centralized government. I’m a lifelong conservative. That’s what’s shaped my beliefs in part because the way I understand conservatism is that it’s based very much on the human experience. It’s a negation of ideology, Russell Kirk and others have said. You have to take into account what works for the human condition. I’d say that there are several reasons for it in terms of why one is skeptical with centralized power. One is simply on the efficacy standpoint. Peter Schuck wrote a book about why government fails. He refers to himself in the book as a militant moderate.

He’s not an ideological person, but he’s an empirical look at what it is about a large government that doesn’t work very often, that fails where the efficiency is not what it ought to be. Anybody who’s worked there, if they’re honest, would concede that fact. How often these grand promises and hopes that are sincere and don’t translate into reality. I think you could look at much of the great society and see that. Even programs which have done some good but have also are themselves extremely inefficient like Medicare and Medicaid. I wouldn’t argue that no good comes out of them. I don’t think that’s sustainable, but those programs are not nearly as efficient as they could be.

TWS 14 | Dynamics Of Capitalism

Dynamics Of Capitalism: Most of life is acting in our self-interest provided that it doesn’t run over the rights of other people.


I’d say the inefficiency and lack of efficacy for centralized government is something that we need to be alert to. There’s the concern that the founders themselves had and many others who had, which is when you centralize power, there’s the danger of authoritarianism and even totalitarianism. That as the old maximum goes, power corrupts and absolute power corrupts. We’ve seen time after time that when people get a tremendous amount of power, when it’s unchecked and it’s on challenged, that can lead to some very bad conditions and situations. That was the worry of the founders. That’s the reason that they set up our system of government of checks, balances, and separation of powers because what they wanted was not an efficient government. They wanted a government that protected against tyranny.

I think that’s a second reason that people need to be wary about centralized government. The third reason is that if you go back and you read Adam Smith in a certain way and probably more specifically this idea about which is that there’s this mythology among Progressives, which is that if you get a group of wise men, wise women, they can oversee, conduct, and determine how human society can act and all realms that simply isn’t possible. They can’t do it. There are so many imponderables in lives, so many contingencies in life that the idea that a centralized state or a group of individuals would be able to make those judgments. I just don’t think works.

The fourth thing I’d say is George Will, a marvelous book that he wrote called The Conservative Sensibility writes about the American founding. He says, “That’s essentially what conservative’s need to conserve.” which is the idea of inalienable rights. Natural rights, rights that precede government. His argument and I think it’s a valid point that government, if it gets too large, too centralized, can undermine those natural rights. He makes the case in a pretty persuasive way that the belief in natural rights would tend to lead one toward a more limited government.

Let’s go to your book because you look at the idea of capitalism and just the word itself formulates a specific reaction in people as far as my experience is concerned. It’s not necessarily based on logic and thought through education debate where a person comes to an understanding. It’s more based on what has been heard. What society believes about that word? Talk about your best-selling book, Wealth and Justice: The Morality of Democratic Capitalism and weave that into the conversation. Talking about how that can essentially be a message that will hit on the principles that make capitalism good for society as opposed to what most people react to, which is that it exploits people and takes advantage of people. It’s all about the wealthy and them getting their own.

People are capable of virtue and nobility, but also acts of recklessness, irresponsibility, and evil. Click To Tweet

I coauthor it. It’s a monograph of the American Enterprise Institute with Arthur Brooks, who was for many years President of an American Enterprise Institute. He left to take a professorship at Harvard. Arthur is very good in a very sober and thoughtful voice on this thing. We wrote this book and the situation is more acute than it was when we wrote it. One of our concerns was Americans in general and particularly young Americans were losing faith in capitalism as a system. We see that in polls, and you’re probably more familiar with them than I am. The support for socialism is higher than at any time in my lifetime, probably higher than at any point since the early part of the twentieth century.

You see this in contemporary politics with the Democratic Party who are two of the hottest political figures in democratic politics, Bernie Sanders and Alexandria Ocasio-Cortez. They’re both self-proclaimed democratic socialists. If you watch the democratic debates, you see Bernie Sanders and Elizabeth Warren essentially taking an anti-private enterprise stance. There’s almost a reflexive hostility to anything having to do with capitalism or corporations. It doesn’t mean that those certain corporations don’t deserve criticism, but it’s a reflex. You’ve seen this rise in respect and to some of the enthusiasm for socialism and the decline in competence and capitalism. That’s a problem. Some of that is undoubtedly a result of the great in 2008. I think that the income gap between the most wealthy and the rest of the society probably had more of an effect on the general public than a lot of people on the right thought that it would.

It seems to have permeated society and the belief that the very rich are making out like bandits, the rest of us are not and so much of the gains in wealth, money from the market, that has happened. We’ve had wage stagnation from pretty much the entire part of the 21st century. Wages had been much flatter and it’s a complicated set of reasons for why that’s happened. I wouldn’t blame that on any single president. Certain deep trends are in play here, which I’m guessing you’ve covered. There seems to be a lack of faith in capitalism. That’s given rise to populism, which I’m wary about as a conservative. I think populism can often be antithetical to capitalism and it can be antithetical to reason itself.

I think it first goes to reason because I would say there’s less reason. It may be the delusion of information that’s all around us and individuals who can’t fit anything else into their head. Therefore they take the efficient approach and leverage the belief system of someone they feel is like them. It’s interesting to see how society has been wired to think a certain way and it’s not necessarily the beliefs associated with reason, debate and personal individual understanding. Its group thinking dictated by very persuasive people like your AOC and Bernie Sanders.

TWS 14 | Dynamics Of Capitalism

Dynamics Of Capitalism: It’s important for the defenders of capitalism and free-market to make those arguments and not to be dismissive toward the critics.


I think that’s right. There’s a rage at the system, the establishment of healing. It’s almost a quasi-nihilism. You see this toward capitalism and the politics in general, which is this idea that we have to burn down the village to save it. Things couldn’t be worse. Let’s just toss the whole thing aside. That’s what explains in part of the rise of Donald Trump. I’ve been a very strong and persistent critic of Donald Trump in large part on conservative grounds. What he tapped into is a sense that people wanted a wrecking ball to come in and shatter things. That’s deeply anti-conservative impulse, but he tapped into it effectively.

I’ve told friends of mine who were pro-capitalism and pro-free-market as I am. It is important to do a study or set of studies to understand what happened. What explains the loss of faith in capitalism, the rise in affinity for socialism. Both attitudes and specific episodes and incidents that explain it to understand in a thoughtful way what is driving it. What are the attitudes? What is associated with free-market and capitalism and to think through how do we tell the story? What’s the narrative? What’s the tale we have to tell to remind people why capitalism is a system that has brought so much human flourishing and then so much to encourage human dignity?

I think it was Orwell who said that the first duty of a responsible man is a restatement of the obvious. Sometimes you have to restate what’s obvious or what you thought was obvious. I’ve noticed this in life, in politics, and in economics and all sorts of realms, which is sometimes people forget to make the arguments in some fundamental way. Why is it that we believe what we believe? That’s understandable. You think that certain victories are one, that arguments are settled and you just act on that assumption. Sometimes without quite realizing it, the floor breaks and all of a sudden, that confidence that people had or that understanding those shared assumptions are gone.

I think when it comes to capitalism, it’s quite important for people who are defenders of capitalism and free-market to make those arguments. Not to be dismissive toward the critics, not to laugh at them, not to say these ideas are stupid. Therefore, it shouldn’t be repudiated. Don’t even engage in name-calling, just say socialist and hope that is enough. We have to do more fundamental work to make the case again, and in a sense to win the hearts of ordinary Americans. To explain to them why capitalism is an economic system worthy of their loyalty.

No matter how strong your argument is, it's never as strong as you think it is. Click To Tweet

Let me use some way to abstract of an example as you may use to. There is a documentary that I saw called Behind The Curve. It was essentially about this millions of people that came together stating that the world is flat. That documentary was done by a non-flat-earther. It was interesting because he took this approach and it’s a very irrational thought, but yet millions of people were gravitating toward this. It was all driven by this emotional desire that they have to fit in within a group. Usually, a group of people that don’t believe what everybody else believes. What’s fascinating to the point you just made is the individual who was doing the documentary, they interviewed astrophysicists. They were saying, “Do you know that there’s this group out there, millions of people that believe the earth is flat?”

It’s fascinating because it takes you through this psychological urge of what I think you’re speaking to because the astrophysicists in the end said that, “These people don’t know what we know, so we can’t assume that they do and make an argument from that standpoint.” You have to meet them where they’re at and why they’ve come to that conclusion. If you start to make them wrong or make them feel stupid, it’s just going to strengthen their argument. That fits within the confines of what you’ve been talking about.

That’s a very interesting observation. I’m intrigued. I like to see that documentary. That whole area does fascinate me, I must say. I don’t know if you’re familiar with the work of Jonathan Haidt, who is a marvelous moral psychologist. He used to be at the University of Virginia. He’s now at NYU. He wrote a book called The Righteous Mind. He spends a lot of time with a group called Heterodoxy, which is an effort to defend free speech on campuses against speech codes and so forth. Jonathan himself has been on an interesting journey and interesting pilgrimage. He started out as a traditional person who laughed at Progressive and is much more of a centrist. In part because of what his research has taught him. I’ve learned a lot. He’s a very intelligent, thoughtful guy and a very good guy as well.

His work on confirmation bias and motivated reasoning is outstanding. I’ve learned a lot from it and it goes to the point that you’re making. I think a lot of us believe that the positions others hold and that we hold are derived through some disinterested analysis of the facts, reasoning, and that reasoning has brought us to what we believe, free of emotion and all the rest. What we know about brain science and human nature, the more we’re looking into these things. It is so much of what we believe is a product of transrational or subrational forces. We have dispositions, tropisms, and predilections were products of our families of origin, our life experience, the people we’re around, and the communities we’re a part of.

TWS 14 | Dynamics Of Capitalism

Dynamics Of Capitalism: There is a chance to get some deeper understanding when people feel safe and when they feel heard.


That sense of fitting in with communities is extremely strong. We know from brain science that when you get information that confirms what you already believe, it’s a dopamine effect or rush. On the flip side, when there’s information that challenges certain basic assumptions, your brain puts up often a shield to block those things out. It’s genuinely uncomfortable for people to hear information that challenges them. I’d say in my own life, politics and just human relationships, that’s one area where I’ve changed. In the past when I would have differences with people, I would often write long emails, fact base, point-by-point. People who know me would think I was built to respond to some of these issues in terms of debating. Empirical evidence, premise facts to support it, conclusion.

What I’ve discovered is no matter how strong your argument is and it’s never as strong as you think it is. Let’s just assume for the sake of argument. You and I were having a debate. The case I presented against you was overwhelming by any objective standard. The odds are not only that, you wouldn’t change your position if I overwhelmed your case. You would probably, as you were indicating, dig your heels and more. It’s quite rare to shift people. I’ve seen this in theology, in the world of Christianity, in the world of politics and all sorts of world. Where there is a chance to get some deeper understanding is when people feel safe, when they feel heard. When they believe that you know their arguments and at least can state them and understand them even if you disagree with them. If there are a human connection and a human relationship, if you have in a sense standing in somebody else’s life and that will allow them to let you in and to make their case, and vice versa.

Alan Jacobs, who is a professor at Baylor used to be at Wheaton, wrote a book called How to Think. He refers to a foundation that when they conduct debates, the first thing that they require is that the people are debating. Person A states the position of person B in such a fair-minded way that person B believes that it is a fair restatement of their views and vice versa. That is the precondition before the debate goes on. If that thing happened more often, we’d get a lot further along. We know this from the social science evidence. We are as polarized as we have been since reconstruction. It’s a deeply polarized society and when that happens, people tend to go into their own camps and they shut off people who have alternative views. I think that’s happening in all realms, including in the realm that we’re talking about free-market and capitalism. That goes to the larger discussions we’re having, which is how do you make the case in a way that the people who could conceivably be open to an alternative case are.

You’re hitting on everything that has been going through my mind. What you said was brilliant. That’s where I look at just my experience and what I was trying to get to with the whole idea of central governance. People don’t like to be told what to do. There’s this fighting response to it that I think goes into what you were referring to as our unconscious or what’s built into our wiring. That right there includes a lot of when we had to survive where we don’t necessarily have to survive anymore, but yet those instincts are still there. When a person feels attacked, I would assume that it’s very similar to being attacked by the sabertooth tiger or some animal.

Human life and experience is about learning things and recalibrating new facts and conditions that arise and trying to adjust accordingly. Click To Tweet

That’s where I look at AOC and I look at Donald Trump in a way, especially where in a sense they understand psychology. They’re using what people will respond to as talking points and statements. People fall prey to it all the time. I look at the psychology side of things and going to where economics is and usually, the argument for capitalism tends to be rational thinking. I look at how human beings are wired. The majority of it’s emotional. That’s where I look at the values and principles approach has something that intrigues me as opposed to labels like capitalism, Democrats, Progressives or Liberals. It’s looking at principle as opposed to labels because the labels immediately there put you in that camp or excludes you. If you’re in the camp, you’re going to believe what the camp believes and if you’re excluded, you’re not going to believe it.

Labels exist for a reason because they label something. They identify world views, but I think that the labels by and large are probably counterproductive. Once the labels are cast out, then you’re putting people in categories, they’re putting you in categories. It becomes awfully neat, tidy and untrue. It doesn’t allow for flexibility and nuance, which is what human life and experience are about. You learn things, you refine your thinking, you recalibrate, new facts, new conditions arise and you try and adjust accordingly. If you’re in these ideological boxes, it’s very hard.

I’ve had these conversations with Trump supporters because I’m a lifelong conservative and I worked in three Republican administrations and in a Republican White House. I have a lot of friends who are Republicans. I’ve been so critical of Trump. They’re puzzled or upset by it. I’ve had a lot of conversations, many of them good. Sometimes it takes an effort to make sure that the relations don’t fray. It’s been helpful for me because I’ve been able to hear their perspective and understand where they’re coming from. I must say that there are times in which one makes an empirical claim as it relates to Donald Trump that is a criticism of him. Let’s say something about that he has lied and there’s demonstrable evidence that it’s a lie. It’s been fascinating to me how it just doesn’t breakthrough.

It is as if they think that that’s the thread and the whole thing can come apart. If they can see one thing that the whole project comes apart. I’ve experienced this throughout my life in politics, particularly when you’re in the White House. Many of the issues that you confront are complicated issues. They’re very intelligent people arguing different policies and different points of view. Often the decisions are 60/40 or 65/35. It’s not 100% arguments on one side and 0% on the other. That’s part of what discretion, judgment, prudence and wisdom is in governing. It’s the ability to hear these arguments which sound potentially equally persuasive thinking through we choose the one that is most appropriate given the circumstances we’re in. What are the contingencies that we have to anticipate but are unknowable? If you’re deciding a set of policies that you want to roll out, what’s achievable politically and not? What’s the composition of Congress? You might want to push some elements of privatization of Social Security, which you could believe is the right thing to do, but maybe it’s not achievable.

TWS 14 | Dynamics Of Capitalism

The Death of Politics: How to Heal Our Frayed Republic After Trump

Maybe you have to do something ahead of that. These are all very complicated issues to take into account. Often they are choosing one set of policies over and against another one or 60/40, but then when you get into the actual discussion, those differences disappear and that weighing of pros and cons disappears. It’s as if all the arguments are on one side and not on the other. Once you settled on a position, there seems to be some reflex that we have that says, “I can’t concede a single point to the other side because if I do it, I weaken my case and I can’t possibly weaken my case.” You have people shouting, talking points at each other, talking past each other, and refusing to engage each other and saying, “That’s a valid point. I think you’re right. I just think that the other arguments on my side outweigh the good point that you’re making.” It’s all very complicated and very challenging stuff, but I think in part explains why our politics is as broken as it is.

For the readers, I love having these conversations. Hopefully, this is valuable to you. Some of the things you’re saying, it comes down to this relation to human connection. I think all people want to connect. They want to have a relationship. At the same time, there’s this instinctive protection that they have where they want to look bad. They don’t want to be wrong because what that does is it invalidates their identity to an extent, but when you break down those walls, it’s amazing what can happen. People, either value is a value or a principle is a principle or it’s not. Most people would concede to capitalistic principles if it wasn’t labeled capitalistic principles. These are principles of life in a sense. I’ll end with this and I’ll let you have the final word. There’s something I’ve thought about, which was interesting to me.

I have little kids, two teenagers and a five-year-old. We went to the Disney Aulani Resort on Oahu. When I was there, there’s this central pool section. There were these two guys that had these big earrings, big guys with these tattoos on their arms, hardcore guys. I was able to have a conversation with them. They were there with their kids. We were in this environment in which the walls were broken down and you can have that connection, yet if I went to their neighborhood and was walking down the street at night, the environment changes, walls are up and the outcome is not going to be the same. Human beings are wired in a certain way and we want certain things. They’re very similar yet because of these walls that come up and are reinforced, it’s difficult to have the connection that’s needed in order to make even more progress.

That’s a very interesting story and I think it touches on these deeper truths that we’re talking about. An awful lot of this is what you described, which is a sense of identity. That’s basic to human beings, feeling of belonging, and feeling of community. It’s pretty rare to find people who will take stands that will put them at odds with the community that’s most important to them. That explains a lot of the political tribalism, but we’ve got to find a way to try and break down these walls you’re describing. There’s some lovely verse in the New Testament about breaking down the dividing walls that exist between people. When those walls are up, it usually means that life is going to be harsher, less sympathy, more anger, more antipathy. People begin to view other folks not as individuals that you disagree with, but as enemies at the state, enemies of your cause.

We need other people with other experiences to help us see and to understand. Click To Tweet

What can quickly kick in is the dehumanization, which is if you see things differently than I am. It’s not because you’ve analyzed things wrongly and you made an intellectual error, but you’re morally defective. There must be something wrong with you. If you don’t see things the same way I do, then you don’t value the same things that I do. In fact, you’re a threat to them. We see that in contemporary politics. We know from the data that the attitudes that Republicans, Democrats, Progressives and Conservatives have toward each other. It’s much more personal than ever before. There’s a feeling that these are not just differences of policy, but they are character flaws and faults. If you feel like you’re being attacked on that fundamental level, you’re an alien, a malicious force, a malignant force, that you want to hurt me and you want to hurt everything that I know and love. When that happens, a lot of bad stuff kicks in and we’ve got to break through that. We have to deepen the understanding and sympathy that we have for one another.

In the book that I wrote, The Death of Politics: How to Heal Our Frayed Republic After Trump. I tell a story in one of the chapters about CS Lewis and Owen Barfield. CS Lewis was a great medievalist and scholar in England. He was probably the most important Christian apologist of the twentieth century. He started a literary group in England in the 1930s. He and JRR Tolkien were the mainstays of that, but there was a person named Owen Barfield who was a British philosopher and poet and somebody that Lewis knew for many years. Lewis in his book Surprised by Joy describes what he refers to as first friends and second friends. For him, it was a person named Arthur Greeves, somebody who knew since his childhood. He said, “First friends are the individuals that when you start the sentence, they’re able to complete it. They’re your alter ego. They see the world largely the same way that you do process it the same way.” We all need that. That’s part of what human community, human attachment, human relationships bring to us. Lewis described what he referred to as a second friend and that was on Barfield. He said, “The second friend is the person who’s not your alter ego, but your anti-self.”

That’s the person who describes who reads all the same books you do and draws all the wrong conclusions from those books. He has a section where he talks about these debates that he had with Barfield and they were pretty intense. They were esoteric debates, but they were about the role of imagination and reason. Lewis says that he and Barfield would go at it hammer and tong late into the night learning the power of each other’s punches almost unconsciously beginning to absorb what the other person was saying. Out of this dog fight, a community of affection grew. The punch line was that Lewis and Barfield both treasured their relationship precisely because they took all the world somewhat differently than the other. They felt that their aperture of understanding was grayer because they had each other in their life.

Barfield later said that, “When Lewis and I debated, we didn’t debate for victory, we debated for truth.” That’s just an entirely different way of approaching dialogue and conversation, which is, “Do you have something to say where I can learn?” “Can I come out of this conversation knowing something that I didn’t before? Knowing something about you, something about the nature of the world, something about the experience that helps me see things better than I would have?” That goes back to what we were talking about, which is epistemological modesty. Even if in some abstract sense you or I were 100% correct in our understanding of a particular issue, there’s still no way that we could know the full truth and reality of things on any number of issues. That’s not within our capacity. That’s why we need other people with other experiences to help us see and to understand. If we were able to take that to heart and to incorporate it in our lives and embrace it, a lot of things in life would be better than they are.

I’ll say something to that. There’s a concept and idea that I love to use, which is three sides of a coin. Most people look at coins with two sides. There’s the edge, which is the third side. The concept is heads is one opinion, tales is another opinion, but then your opinion should sit on the edge where you should evaluate. Where are the arguments? Where the perspectives are coming from and then rationally come up with your own. I tried to look at that because you’re hitting the nail on the head with a lot of stuff we’ve talked about when it comes to perspective, what truth is, how people come to truths, and then how people change and essentially go from one side of the spectrum to another. Everything you’re hitting on is fascinating. I’d love for our audience to learn about you. Would you mind talking about your book and where they can pick that up? Also, how they can follow you. I know you are contributing to The Atlantic as well as The New York Times. Maybe talk about those outlets so that the audience can follow you.

The book that I just wrote, which was published by Harper Collins is called The Death of Politics: How to Heal Our Frayed Republic After Trump. It’s an account of my life in politics. What I’ve learned, why I believe politics is important. I think it’s a low moment and a dangerous moment, but I make the case that we need to do something about it because justice matters, and politics, it’s about a lot of things. It’s got its dark undersides as all professions do. It’s finally and fundamentally about justice. The book I wrote in less than a year, but it’s the product of a lifetime in politics. People can get that on Amazon, Barnes & Noble or any of the other outlets. I’m a contributing editor for The Atlantic Magazine. I’m a contributing opinion writer for The New York Times. I’m a Senior Fellow at the Ethics and Public Policy Center. People can follow my work there. I’m on Twitter @Peter_Wehner. I write about all sorts of issues. I’ve written about capitalism, politics, faith and friendship, and then from time-to-time, I interview people for The Atlantic. I did a couple of interviews with David Brooks on his book, The Second Mountain, and then with George Will and his book, The Conservative Sensibility. For me, it’s a lovely way to earn a living, which is for me to write, think, talk to intelligent people, and try and learn along the way.

Peter, it’s been such a joy to speak with you. This has been an awesome conversation for me and I’m hoping readers got as much out of it. Thank you again for your time. Thank you for the good that you’re doing. We’ll have to connect in the future sometime.

I’d like to do it. I enjoyed the conversation a lot. Thanks. Take care.

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About Peter Wehner

TWS 14 | Dynamics Of CapitalismPeter Wehner is the author of The Death of Politics. He is a New York Times contributing Op-Ed writer covering American politics and conservative thought and a popular media commentator on politics.

Wehner is also a Senior Fellow at the Ethics and Public Policy Center and veteran of three White House administrations.



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What It Takes To Be A Successful Entrepreneur with Brandon Bliss

TWS 3 | Successful Entrepreneur


Being a successful entrepreneur takes a lot of time, hard work, and dedication. Once you’ve got a taste of success, it’s hard to go back and make everything work. Brandon Bliss, CEO of Orbit Medical, tells more what it takes to become a successful entrepreneur. Brandon talks about why it is crucial to take risks and execute your ideas to succeed in whatever business you’re doing. Furthermore, he shares some of the best books you can start reading that will help you gain wisdom to run your business. Learn more on what it takes to be successful as Brandon reveals how he got to where he is now.

Watch the episode here:

Listen to the podcast here:

What It Takes To Be A Successful Entrepreneur with Brandon Bliss

Thank you for reading this episode. You are going to get a kick out of this. First, I wanted to say how thankful I am for the response that I’ve received based on the kickoff episode. Hearing from all of you has inspired me a great deal. I’ve heard transformation stories of those who had realizations and an impact based on, “Things I listened to on the show,” that changed their life. Opportunities for business, for investment and for changing the way they manage their finances, it’s been incredible to hear those. I start to incorporate some of the ideas that have come from these interactions.

Thank you so much. Keep them coming. Leave reviews on iTunes. That is helpful because it gets the word out. Email me. For now, use the Patrick@PatrickDonohoe.com. I’ll try my best to respond to you directly. As far as feedback is concerned, it’s what your experiences have been, what you have liked, what you would like to see more of. That simple feedback means a great deal to me. I’m going to change a few things because of it. First thing, I’m going to try to do some more feedback based on my opinion of the subject matter, as well as the guest and why I have this specific guest on and also some commentary around financial strategy. There are a lot of you who enjoyed the Financial Fridays that we did last season, although we did not do them every week. There was a lot of feedback in regards to the content there. Thank you for pointing that out. I’m humbled by all of you who are taking what has changed my life and those who I know as clients. It means the world to me to know that you have taken action on certain principles and certain strategies and taking them to heart and done something about it. Thank you from the bottom of my heart.

Let me get to the guest. He’s the CEO of Orbit Medical. Brandon is someone I grew up with in Central Connecticut. I’ve known him since my childhood. I consider him one of my best friends. He has inspired me over the years. He is exemplary of this idea of our theme this season, which is entrepreneurship. Brandon has gone through a lot in his business career. It’s indicative of what happens through overcoming obstacles and facing challenges. Within business and entrepreneurship, you’re going to face the gamut, regardless of what industry it is. This is the medical industry. Specifically, medical supplies is a highly regulated industry. Oftentimes, you deal with things that are completely out of the blue.

Brandon and his passion and desire to achieve and also receive that sense of fulfillment that comes from achievement is going to be the perfect guest. We’ll probably tell some jokes and some childhood stories and probably memories that he doesn’t want to relive or maybe I don’t either. We had some great times growing up. We have kept in touch. He lives close to me now. It’s going to be awesome for you to see maybe a different side of me, but also talk to somebody that I have a great deal of respect for, that has inspired me probably more than he realizes. Let’s talk to my good friend who’s the CEO of Orbit Medical, Brandon Bliss.

For this episode, we’re talking about entrepreneurs and entrepreneurship. I always say I have special guests, but this guy is a special guest. Brandon is the CEO of Orbit Medical. Brandon and I grew up together in Central Connecticut. The reason why I wanted to have Brandon on the show is that I’ve had tremendous admiration for him for a long time, starting when I was young. Our friendship over the years has evolved in business, has provided an outlet for me to talk about my business, the challenges that I face and ideas. Brandon is a wealth of information. He has also experienced a lot of success in business and the challenges that most businesses face. We had a conversation about like, “I got to this level. How did you get to this level?”

Everybody wants to be with whoever's winning. Click To Tweet

Our parents were entrepreneurs. Our parents didn’t tell us to do this. Yet, we wound up in this situation. Us seeing each other grow up and the experiences that we had together growing up, and seeing where we’re at now are cool to reflect on. We’re going to do a little bit of that to begin, and then get into his business background and talk about what he has seen in the marketplace as far as successful entrepreneurs and what makes a successful entrepreneur. First off, I know you don’t do podcasts. I try to make it so we’re having one of our normal discussions.

I’m terrified, but I’m happy to get this one under my belt. Thanks for having me.

Thanks for coming on. Let’s start maybe along the lines of the discussion we had. Our parents weren’t entrepreneurial. We grew up in a normal, lower middle-class set of circumstances. We both chose different careers. You’re in the medical field of finance. Yet at the same time, we decided to do our own thing or at least wound up doing our own thing. As you look back, how have you pieced it together? What are some of the things that made you want to do that and why you’re doing what you’re doing now?

I’m not exactly sure why I’m wired the way I am, but it goes back even to childhood where my buddies were lifeguards, my buddies were flipping burgers and I was like, “I’m not doing that. I’m going to make way more money, open my own landscaping company, work half the time and outsource the work to my brothers or other buddies.” I’ve always not done well working for other people. I prefer to be in charge. I’m wired that way. I’ve always gravitated to that. Even out of college, I studied Finance at the University of Utah. I took a job in sales. One of my buddies recruited us. I had a lot of success. I quickly became one of the top salespeople. They started throwing equity at me so I wouldn’t leave. I got a taste of owning businesses as opposed to working for other people. Once you’d get a taste of that, it’s hard to go back. I would do everything I could to get additional equity and buy out people or take advantage of circumstances so that I had more upside. That’s what I’ve been doing. Along that whole way, I diversified as quickly as I can and started trying to get equity in other businesses and get the money working for me.

One thing that I connected, which is a similarity of us, is you are successful in football. You played football for a couple of years and looking at hockey. Sometimes the drive to excel and succeed and win translates into other areas of life. You’ve always had that characteristic. Business and excelling and succeeding come with its challenges and failures as well. It’s proportional in some cases. How has that tenacity and that drive that we experienced, maybe in sports, played into that?

TWS 3 | Successful Entrepreneur

Successful Entrepreneur: Once you’d get a taste of owning businesses as opposed to working for other people, it’s hard to go back.


It crosses over well. If you’re going to compete at the higher levels of any sport, you have to have an edge. You have to be super competitive and you want to win. You hate losing. If you can translate that, you bring that into your business, compete at that level and make your competitors nervous about going up against you. You keep your foot on the gas the whole time, innovating and finding better ways to compete. Usually, the outcomes are positive. You capture market share and you retain talent. Everybody wants to be with whoever’s winning. That has served me well here. I was much more successful in high school in sports than I ever was in college. I tried hard. The time you have to put in, the dedication, the hard days, the pain you feel, all that stuff will help you take the punches when you start businesses or you’re trying to get companies to the next level. Sports will set you up. There are many setbacks in sports. There are many injuries or disappointments or heavy hard losses that you’re going to experience in that business. You’re going to fail. You’re going to get punched. You’re going to have three snakes coming at you at once. You’ve got to maneuver through it and be tough and not give up. If you’re tough, you win sometimes.

With businesses, you’ve had more experiences here. When I see success in somebody, an entrepreneur or a business or an investor or someone who’s successful in general, you tend to have two camps. You tend to have those that have only experienced success. You have those that have experienced a proportional amount of hardship. What I’ve seen from that point going forward, the failures I tend to see are those that have experienced lots of success, get punched in the face and don’t know how to react. As you’ve looked at other businesses and as you’ve been involved with your own and employees in general, where have you seen that dynamic?

It reminds me of that E-Myth book where everybody wants to have some success but works for someone else, and thinks they can duplicate it and do it elsewhere. There are a few experiences in my life where I’ve seen people go down that path and crash and burn and I think about why that happened. It’s easy to read books and maybe watch other people do things. If that individual, that CEO, that founder can’t surround himself with the right people, if he can’t execute on the plan and get enough cashflow coming in to survive until he can figure out exactly how to compete, most of the time it doesn’t work. That’s why many businesses fail. The number of people that can execute on that are few and far between. There are a lot of people with big ideas and can work in a big organization and contribute and do well. To take risks and the punches and to go off and do it on your own and then execute, if you haven’t done it or you haven’t been part of someone that’s done it and you’re right there, it’s hard.

You look at these tech startups. I’m involved with some of them. I’ve put money into them. This is my tuition in this world. I’m not successful in investing. These are your subscription-based tech companies that are doing rounds of funding and trying to hit it big. Has that founder done it himself? Can he raise the capital? Can he execute? Can he hit the different milestones that they need to get the scale so that someone will acquire them? That’s hard. Most will never ever do it. I learned that the hard way. I learned that in the process of investing in them. It can be applied to all different businesses. People may even have passion, but if they cannot connect the dots, if they don’t have those dynamic chameleon-like social skills to be able to put it all together until the cashflow stabilizes, it doesn’t work.

From a people perspective, since we’re young, you couldn’t work for other people. That’s oftentimes the cause of people going out on their own. They can’t work for this person. They can’t work for that person. Talk about your experience with understanding people. An entrepreneur that goes out on his own, that can’t work with other people is another big red flag. Even though you can’t work for a boss per se, how have you seen the ability for successful entrepreneurs as it relates to the relationships and communication and having people that are part of their organization?

If people are interested in your opinion, they'll ask. Otherwise, you shouldn't offer your counsel until they're ready to listen. Click To Tweet

I was in bed watching The Profit, this CNBC show. You see this guy, Marcus, he goes into these businesses. He’s dealing with entrepreneurs that are most of the time rough around the edges. They have not been able to scale or execute or make any money. They’re in dire straits. He comes in and puts in his people and his processes. He’s got the psychology thing understood. He knows how to get people in the right lanes and get it going. It was awareness. Most entrepreneurs, a lot of them like me, Alpha male, Type-A-driven, athlete, they can only take businesses so far unless they get the right people around them and step back and stop controlling everything and become aware of where they’re good and where they’re not good and empower people to scale. Some guys or gals can become aware of that. Other ones, it’s a disaster because no one ever helps them. They don’t engage a coach. They don’t engage a mentor that will open their eyes to the next level of what has to happen to get to the next level.

I’ve had partners like this. I’ve had phenomenal sales guys that have equity in a business, that grew it, scaled it but it topped off. The ops weren’t where they needed to be. They ran out of money, the investors pulled and they could not get outside of themselves and get the people on the team to continue to the next level. It comes down to how coachable is that person and how grounded and how stable. Are they emotionally stable? If they’re not, if they’re erratic, if they’re irrational and they’re all over the place, people eventually don’t want to work with them.

I don’t know if you’ve ever read Ego Is the Enemy by Ryan Holiday. That’s such a good book. He’s written a few books, but his two primary ones are Ego Is the Enemy and The Obstacle Is the Way. He’s an incredible writer. I went back and read a few parts of the Ego Is the Enemy. That’s one of the biggest dangers. When you succeed, it’s naturally ingrained in us. It’s like, “I succeeded. Look at me.” That’s one of the most dangerous periods of time too. When you reach that status, you don’t want to experience the other side of the spectrum. When you hit that status, that’s when you have a tremendous amount to lose because nobody likes the person that is masking failure. Even though you’ve achieved a level and in order to achieve the next level, you’re still going to experience failure. You’re still going to experience challenges. There’s going to be new. If you start to equate success with not failing first, it’s going to be a slippery slope.

This has been my experience. My biggest failures have come from making a mistake where the organization is failing in certain aspects and masking it. It starts to hide certain things because people know. There’s this power of vulnerability, especially from a leadership perspective. If people know that you’re fallible, people know that you fail and that you’re okay with it and you realize that’s part of the equation, it makes them comfortable as well. What I’ve connected is that my failures often come from me doing things that I should not be doing. An entrepreneur or a business owner has certain attributes and characteristics and specific roles and responsibilities attached to that. If they start to deviate outside of that and do things they shouldn’t be doing, especially if they’re other people’s responsibilities, that is where the whole ecosystem starts to break down.

TWS 3 | Successful Entrepreneur

Ego Is the Enemy

This company I’m CEO of has 140 employees. I’ve grown up with this company. I was part of the original team in 2003 that started it. I’ve gone all the way until now in the same company. We’ve grown as leaders and failed over and over it again as we figure out how to make money. We lie to ourselves. We pretend we don’t have problems. We turf build. We create silo. We do all stupid things that hurt the business and prevent us from growing and doing what we need to do. Getting rid of that behavior or being vulnerable and admitting, “I wet the bed there. I totally messed up. This is the outcome. I want to share that with you as a team so that you don’t make the same mistake I did. Let me fall on the sword here,” people love that. If people are more willing to say, “I need help here. I’m not the right person for this position. I need to bring somebody in,” we can start moving forward. If I had learned these lessons several years ago, I’d be well-off. I’m not as well-off as I wish I was.

The point is there’s no way you would have understood that unless you went through the experience to be aware of it.

I beat myself up. In hindsight, “I should have done this, this and this or I could have executed this turnaround quicker if I would have done this, this and this.” It’s unfair for others and for myself to beat yourself up over that. There’s a lot of could-haves and should-haves. I wish I learned the lessons quicker so I could be better and faster. A quote came to my mind. I like Dwayne “The Rock” Johnson. In my office, my favorite quote I have in a big frame wall says, “The wolf is always scratching.” He tells a story when he was young, they were in Hawaii. He was poor. They couldn’t meet their rent and the landlord was always coming in to knock on the door and ask for the rent. They were close to eviction all the time. He’s done well now, but he’s taken that same fear and used that as a weapon or as motivation in his life to never ever take his foot off the gas, to stay hungry. He says, “The wolf is always scratching.” That means somebody’s always trying to knock him off his horse. Someone’s always trying to beat him, be the next best actor, beat him in this role or that role. He’s like, “You have to stay on edge, hungry, competitive.” In my company, we use the word 212. You have to keep it at 212. That’s the boiling point of water. It’s that extra degree of intensity that allows you to be super competitive and hard to beat. If you’re an entrepreneur, you’ve got to keep that edge somehow.

This is from a principle standpoint. Everyone wants to be successful. It’s naturally ingrained in us. It’s not this one-time event. It’s something that happens over and over. Once a person gets to one point, they may achieve something but they’re still thirsty for the next achievement and the next one. The sooner you’re aware of that, the much easier the path is going to be. The point of me explaining that is entrepreneurs don’t have to mean to start a business. It doesn’t mean that you have to go out on your own. It doesn’t mean you have to build a team. It’s also important to understand that it’s desiring to be successful and knowing that it’s okay to be successful, but success isn’t the same for everyone. How, in your business, have you helped employees feel that sense of success? What I’ve discovered is everyone has specific talents and strengths. We’re all different. Every human being is different. As you discover those, as you become aware of those, especially as an employer, as you align the role and responsibility of employees to those strengths, that’s where you tend to have the most amount of happiness and success. My question to you would be, what are some of the ways in which you’ve discovered your own strengths and pinpointed those and focused your role and responsibility around that, but also for employees?

I’m not a TV guy. I try to read as many books as I can get my hands on. I notice you have a nice library. I read a ton of books. I try to get as much knowledge as I can from people that have already gone down this path and hear from their failures, their successes. I try to adopt some of those things. That’s one thing. I made the plunge and engaged with coaches and consultants, mentors. I have some mentors that don’t charge me anything but have been kind enough to take me under their wing and give me pointers. I try to meet frequently with them and have candid conversations with me in what my personality type is like and where my roadblocks are, what I can’t see exactly as clear as I need to.

I pay for a coach that gets into all my business and helps me understand and interviews my network and figures out, “This is what you think your problems are. This is what the people closest to you think your problems are, including your wife. You’re lying to yourself if you think this isn’t true.” That’s a hard pill to swallow, but you want to experience growth. That’s what you have to do. You have to be willing to work on yourself harder than you do at any job. Hopefully, in that process, you recognize what you were born to do, what are these natural strengths that you don’t have to work that hard at developing, and stay in that lane as much as you can. There are a lot of guys that have written a lot of books that are way smarter than me. I’ve read that over and over again, but it didn’t sink in until the coach is analyzing your personality profile and reviewing what your peers or your network are telling you.

Be willing to work hard and sometimes long in the beginning. Later on, you can balance things correctly. Click To Tweet

You’re like, “I need to stay in this lane and I need to delegate. Even though I can do this person’s job better or do that same role better than they can, I have to discipline myself to step out and be okay with them doing it their way and stay out of their way.” As much as that’s hard for me because I want to coach them and tell them how to do it and follow up and repeat myself over and over again. It does no good. They have to do it themselves their way. If they are interested in your opinion, they’ll ask. Otherwise, you probably shouldn’t offer your counsel until they’re ready to listen. That’s what I’ve done. You’ve got to work on yourself, become aware of where you’re supposed to do, your strengths and then stay in that lane as much as possible and supplement the other parts with good people, attract the best people in each of these different marketing, sales, operations and finance and get them what they need and stay out of their way and support them.

Have you ever heard of John Boyd? He’s one of those early personal development business guys. He was a Vietnam War pilot. He had this business theory called OODA Loop. It’s a feedback loop. OODA is an acronym. It stands for Observe, Orient, Decide, Act. The observation comes from the feedback. In war, what he would do is he’d observe all the feedback that’s coming at him, whether it’s instruments, whether it’s where the planes are. Orient himself as it relates to what’s going on in the environment, make a decision on what to do, act and keep on repeating it. The idea is most people hate feedback. They’re afraid of what they’re going to look like if the feedback isn’t good. At the same time, feedback is feedback. If you get that feedback, you’re able to orient yourself appropriately and then make a decision and act and continue to do that.

Oftentimes, we’re our own feedback. We lie to ourselves. We say things are better than they are. We say, “I’m good. They’re not. It’s their fault, not mine.” We don’t take responsibility. There are some human tendencies there. As it relates to employees and feedback, everyone does a job and they get results from that job. I have discovered that there is a way to help a person understand that there are strengths and good about them and that their level of happiness and success and fulfillment is when they’re doing what’s in that zone the majority of the time. The only way they can discover what those strengths are is by taking assessments. I’m not sure which ones you’ve done in the past. There are a million of them out there: Myers-Briggs, StrengthsFinder, Gallup. There are ways in which we can discover things about ourselves and look to the past and get the feedback. The sooner we can accept the feedback and the sooner we can accept that there are a lot of things that we could do but there are only a handful of things that we’re good at. Those good things will align with our happiness and success, the sooner you do that, even before you become an entrepreneur and do your own business, discovering that is going to give you what all the stuff that you’re looking for anyway.

In the end, it’s like, “Is it a pile of money that you want? Are you willing to sacrifice 30 years of unhappiness to get a pile of money so that you can be happy? Is it figuring out a way to be happy right now and be successful right now?” That’s one of the feedback I got from a listener was in relation to the definition of wealth. She was referring to Dave Ramsey. His programs and people are wealthy at the end of these programs. They didn’t go on vacation. They drove a five-year-old Camry for many years. They took the bus and sat next to smelly people. They vacation at the Holiday Inn. They sacrificed all the happiness to have wealth, which is a pile of money. I don’t think that’s wealth. Having a great experience, doing what you love and being happy in doing that is the true measure of a successful entrepreneur. It’s utopia-ish. That’s not realistic, but the reason we’re doing this season is that everyone has the drive to be successful, to achieve wealth, to achieve those levels. The sooner they can understand the principles behind it, the sooner they’re going to be able to take some action and get some results. 

Figuring out that why like, “What it is you were born to do? Who are you supposed to become? What drives you to the deepest levels of happiness?” each individual person’s going to have to ask themselves those questions and seek those answers. I’m in the middle of my journey, so I don’t have much to say on that. I’m more aware now than I was even several months ago in thinking about those bigger deeper questions. I’ve got teenagers in my house. I’m turning 40. I have some years left and I want to accomplish some things. I want to be successful. I thought I wanted this pile of money, but I realize that a pile of money doesn’t do much. I’ve got money and it doesn’t give me the fulfillment that I thought it would. What is it that I want to do with the strengths and with the time I have? How do I give back? How do I create jobs and bless other people’s lives?

TWS 3 | Successful Entrepreneur

Successful Entrepreneur: You go to work on yourself, become aware of what you’re supposed to do and your strengths, and then stay in that lane as much as possible.


I’ve got mentors and coaches that have more years of experience, more financial independence than I do. I’m listening to their philosophies carefully and trying to decide what mine will be. It’s a cool journey. I enjoy the ride. It’s fun. Anybody that wants to start a business and go through it, even if it doesn’t work, it’s still an awesome experience. As long as you are responsible with that risk and you’re not putting your family’s life in jeopardy and you have a side hustle or side business that may grow into something bigger, then go for it. That’s great.

That’s part of the growth cycle.

You’re in America. It’s the best place in the world to do that. You might as well take advantage of where you were born and the opportunities and access to capital here and do something.

Let’s end with some of your favorite books that have inspired you, aside from my book. I’ve told the story before of a good friend introduce me to Rich Dad Poor Dad. That was you. You told me, “You need to read these two books.” It was Rich Dad Poor Dad and Millionaire Next Door. I read them both. I was like, “I like this one. This one sucks. I don’t want to drive some 1975 Chevy for the rest of my life.”

I was the opposite. Kiyosaki and his stuff, it was great. It helped shape my way of thinking. In a different life, I should have been an investment advisor or wealth manager. I enjoy personal finance and studying the strategies. I’m self-taught. That’s why Millionaire Next Door and Millionaire Mind hit me hard. I was like, “I could do that.” I grew up blue-collar. I didn’t have everything handed to me. I’m self-made. I connected a lot with the real millionaires in America and identified with that. I said, “I can live this way but be comfortable and make sure I’m investing and saving and building assets so that I can have fun, live life and be happy along the way, but also accumulate a bunch of wealth.” I do love that book.

Create an environment of respect where you treat people how you want to be treated. Click To Tweet

At different phases of my career, different books have impacted me. When I first became CEO in 2011 or ’12 of this organization, we had gone through a tough situation. I was thrown into this massive adversity. I read the Zappos book, Tony Hsieh and his group, Delivering Happiness. I was creating a culture in a business. His culture was awesome. I tried to duplicate some of his things. That book had a big impact on me for a number of years. Ready, Fire, Aim is a sales book. It taught me how sales is the lifeblood of any business. If you’re going to get anything right, get sales flying through the door. Revenue buys you time to fix operations. I came from sales. I started in sales. I had a passion for sales. I was trying to teach myself how to be a CEO, which is a challenging transition. I’ve taken that to this company and to the other companies I’m involved with. I don’t care about all the other stuff until sales is like, “Don’t mess with their juju. Get them their comp plans. Get them in a good place where they’re bringing revenue in.” That book hit me at the right time.

Michael Masterson is the author. I told the story in the book where I worked with one of his companies. I told the story when I first met him and my experience in his office in South Florida. He’s an amazing business person. That’s a powerful book, Ready, Fire, Aim.

I read all the Tony Robbins books, all the Dave Ramsey books, including his last book, where he talks about the last step, “Once you pay your house off, this is how you build your legacy.” I enjoyed that book. Brian Tracy and his books are always good, the mindset books.

What do you consider are some of your driving business principles? A driving business principle could be courage. It could drive or tenacity. It could be customer first. As you’ve looked at the evolution of your business, what do you consider are some of those top principles?

TWS 3 | Successful Entrepreneur

Ready, Fire, Aim: Zero to $100 Million in No Time Flat

At Orbit, this company I work for, we have what some people call a credo or your core values. Deciding that upfront is a huge part of it. The words that we have on ours tell you who we are and how we think. 212 is one of those little words on there. You have to be willing to work hard and sometimes long in the beginning. Later on, you can balance things correctly. You’re taking care of business at home so you can take care of business at work and be your best without distractions. That’s important. It’s coming together as a team and creating an environment of respect where you treat people how you want to be treated. In our company, we don’t use bad language. We’re conservative. We don’t yell at each other. We have crucial conversations, but we try to have a high level of respect so that they will pour their heart into the business. It’s a win-win for both the employee and for the management team and the company. That’s another one, continuously improving.

There’s this guy I studied for years. Jim Rohn is his name. He had ingrained in my head to work harder on yourself than you do at your job. We have continuous improvement. We want to continuously work on ourselves, knowing that there are better ways of doing everything we do. We haven’t discovered them yet. Every year, we find more and more nuggets that we should have found much sooner that would’ve allowed us to monetize our ideas so much quicker but we didn’t. It’s that culture of continuous improvement and getting people comfortable working on themselves and not sensitive about it or not willing to do it like, “That’s hard to do.” If you can create that culture, your business can evolve quickly. Those are a few that come to mind.

In the beginning, if you’re a startup, you’ve got to hustle. You’ve got to bootstrap. You’ve got to work extremely hard until you have enough contracts, enough cash coming in the door, and then you stabilize things. You work on efficiencies. Jim Collins books. Those are other books that had a big impact at a certain period in my life or How to Win Friends & Influence People. Those ones come to mind. They’re classics. You’ve got to read the Covey books. You’ll crank the efficiency. You’ll squeeze that wrench and become more efficient over time, but you got to hustle in the beginning.

The hustle comes first. The efficiency, there’s never an end to it.

The last thing that I feel important to say is the best leaders that I’ve been around have this arrogance about them. They also have this humility where they realize that they need to get people around them and they need to stay in their lane. I’ve learned that these last few years as we’ve failed in a lot of different areas. We tried things and fell on our face. It did not work. I go before my team and say, “It was an awesome, valiant effort but a bad decision. It’s my bad. My tail is between my legs. Let’s course correct and go a different way.” You’ve got to be okay with that. Some of my most successful partners in some of my businesses, you’ve got to learn from them, ask them questions, take their strengths and shorten your learning curve so that you can be more effective quicker. Instead of trying to learn it yourself and trial and error every single time, you’ve got to shorten that gap with better people around you. Get your network where it needs to be.

We’ve talked extensively about this over the last few years. There’s a turning point in business. When you look in others, you look more for their failures then you look for their actual wins, not from competition or, “You failed, therefore you’re not relevant.” It’s the lessons that can be learned through somebody going through failure that is profound. You taught me through some of the stuff that you did about certain insurance that you can get for these events that could protect you here would save me in a few different areas. I now look for where people fell short and what they did because of that and where they succeeded. You don’t know what you don’t know. Leverage comes in many different forms. One of the best leverage, especially for entrepreneurs and business owners, is that you look where others have failed massively who came back. You don’t want to find the people that failed and gave up. You want to find the failure where they came back and why, what did they learn, what were those lessons.

We can continuously work on ourselves, knowing that there are better ways of doing everything we do. Click To Tweet

They were humble enough to share those with you. That’s why these mastermind groups and these groups come together, you can learn from people that came back, beat the odds and now are sharing their story and helping other people. That’s where I’m at in my career. I’m trying to surround myself with these winners that can help me avoid some of the mistakes. At this size of my company, I’m trying to scale it to the next level. Utah is cool. There are a lot of good entrepreneurs here, a lot of people that take big risks. There’s learning. It’s energizing. It helps me keep my saw sharp and stay hungry and remember the wolf is always scratching. Any success I’ve had, it could go away quickly. I need to keep pushing and taking the punches, moving forward. Hopefully, at the end of the day, I’m happy and loving life and doing what I want to do.

You did a great job for your first show.

I’m grateful that it’s done and behind me. In the next one, I promise I will be more prepared and hopefully say something that’ll help your readers.

We’ll have you on again for a second one.

Thanks for having me.

TWS 3 | Successful Entrepreneur

Successful Entrepreneur: Surround yourself with winners that can help you avoid some of the mistakes.


Thanks for reading. Thanks for participating in this season. We’ve had some guests that are in different fields and different positions of life, talking about more of the philosophical points of entrepreneurship. This is a practical show. In the coming ones, we have some cool guests. Both of Milton Friedman’s sons will be on. Milton Friedman was the Founder of the Chicago School of Economics and wrote a lot of books in relation to freedom and capitalism that play right into the idea of entrepreneurship. This season is going to be awesome. I hope you can take what you’re reading and apply that, even if you’re out of business or working for somebody else. Apply some of those principles and taking action on that, whether that’s discovering more about you, whether that’s understanding the importance and dynamics of relationships, especially professional relationships. I hope you got some nuggets of wisdom. I can’t wait for what you have in store for the remaining episodes of our seasons. Thanks for your support. Brandon, thank you. We’ll see you in the next episode.

Important Links:

About Brandon Bliss

TWS 3 | Successful EntrepreneurBrandon Bliss is President and CEO of Orbit Medical, a large home medical equipment company. He started with the company as an entry level sales representative and was made partner after only two years. He has been the President and CEO since 2011. Brandon has extensive experience in start-ups, business management, project management, employee development, recruiting, sales, and operations. In his current role, he works with every department of the company as they continue to expand and open new Orbit Medical offices across the country.

Brandon lives in Salt Lake City with his wife and their five children.


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Community: The Third Pillar Of A Successful Wealth-Creating System with Raghuram Rajan

TWS 02 | Community


The development of every country is different because each country has a different set of resources, strengths, and weaknesses. Raghuram Rajan, one of Time Magazine’s 100 Most Influential People, goes in-depth on why community matters. As he dives into the three pillars of the most successful wealth-creating system, learn how Raghuram views entrepreneurship, intrapreneurship, and the individual development now and then. An author of three bestselling books, he gives his insight on the wealth gap and the rise of poverty, how communities see things differently and make a subsequent change, and the status of today’s central influence.

Listen to the podcast here:

Community: The Third Pillar Of A Successful Wealth-Creating System with Raghuram Rajan

The world is changing daily. New technology, businesses, toys, games and movies, yet there is a growing concern about the gap between the wealthy and the poor. Presidential candidate Andrew Yang proposes UBI, Universal Basic Income. Alexandria Ocasio-Cortez proposes sweeping centrally-driven reform, but it begs the question, “What is the root of the problem? Why would we give the government even more power when their initiatives of the past have always fallen short of expectations?” My guest may be unfamiliar to most of you, but his resume is beyond impressive. He was featured in Inside Job when he was Chief Economist at the IMF, International Monetary Fund. It’s where he openly challenged Alan Greenspan, then the Chairman of the Federal Reserve, at the iconic Jackson Hole Economic Summit in 2005. The challenge was a controversial paper he wrote that cited the excessive risk-taking of certain investors with no corresponding consequence. He was scoffed at by almost everyone there but was vindicated when the world financial system almost collapsed because of what he claimed.

He was named as one of the 100 Most Influential People in the World by Time Magazine and has written three bestselling books, Fault Lines: How Hidden Fractures Still Threaten the World Economy, Saving Capitalism From The Capitalists: Unleashing the Power of Financial Markets to Create Wealth and Spread Opportunity, and The Third Pillar: How Markets and the State Leave the Community Behind. He’s Dr. Raghuram Rajan, a former Governor of the Reserve Bank of India. He’s also the former Vice Chairman of the Bank for International Settlements. He is the Katherine Dusak Miller Distinguished Service Professor of Finance at the University of Chicago.

This season, we’re talking about entrepreneurship and intrapreneurship, the development of the individual and the difference they can make in their own life and the life of others. I felt that Dr. Rajan’s perspective of the role of community as part of the global landscape is compelling and it reinforces what individuals can achieve in a certain environment. The wealth gap and the rise of poverty is an issue. The typical narrative is that the society safety net, i.e. welfare and money is the solution. That method is easy but ultimately, it’s a Band-Aid, a short-term solution if anything. The lasting change for all individuals requires a mindset change and only the individual can do that. Not a handout, not a paycheck that they don’t earn, but them themselves making that mindset change. I hope you enjoy this second episode of season two of the show. If you like it, don’t forget to spread the word. Leave your review in iTunes and please share this episode on Facebook, LinkedIn or Instagram and get the word out especially for Dr. Rajan and his book.

It is such an honor to have Raghuram Rajan on the show. I’m excited to be discussing your book, but also discussing your perspective on where we stand as an economy and a society. Thanks for taking the time to join us.

Thanks for having me.

You have such an impressive list of accolades. Where did your drive to pursue the career path that you’re on right now come from? What were some of the defining events in your life that impacted the way that you see it?

Different people have different views on where you are. Where I have contributed has been in the area of both economic theorizing and research as well as economic policymaking. If you look from the beginnings, I would say it comes from growing up in a poor country and asking, “Why on earth are we poor? What is it that we’re doing, which keeps us this way?” I had been to other countries that were much richer and trying to figure out what the difference was. It certainly wasn’t the caliber of the people. It seemed to be something else that was making a difference and to that extent, that was in many ways the motivating force behind getting into economics.

TWS 02 | Community

The Third Pillar: How Markets and the State Leave the Community Behind

My wife is from a third world country and when you live in certain circumstances, you tend to accept the circumstances as they are, but once you see the contrast, that’s when those questions begin. What are some of the general conclusions you came to as an answer to that question?

It’s an evolving process. “The question’s always remained the same. The answers change.” I’ve seen the answers change to this question, “Why are we poor?” The answer’s changed over my lifetime. I have a somewhat different set of answers than I would have had as a twenty-year-old. As a young person, you think it’s all about some people having appropriated all the fruits and that’s part of the answer, but it doesn’t explain why they need to keep it for themselves. Why there aren’t more opportunities for everyone else. The easy answer to that point is let’s tax the rich. Let’s spread it all around and we’ll be fine and then you realize the answer’s a little more complicated.

You have to figure out how you create opportunities for everybody. That’s to my mind the real question. How in every country do we create the possibility for everybody to reach their limits? That means first creating capabilities in people. We’re not born as fully-fledged adults with a Ph.D. degree. We acquire all of this on the way. How do we create the environment? That’s where my book on the community, how do we create an environment that enables you to get to that place? Once you have those capabilities, how does the system create incentives for you to use them in the best way possible? How does it make sure that some people don’t appropriate most of the fruits and it’s more widely spread? How do we keep a level playing field both at the beginning, but also along the way? That seems to me the systemic questions we have to answer. It’s not clear to me as I grow older that it’s a menu where we pick pieces from the menu, “I like this, I like that.” It seems more like an equilibrium where a bunch of things happens together and you have to make compromises. “I like this and I like that, I don’t like something,” but that’s part of the reason or that’s how you enjoy the things that you enjoy. You have to give up some other things for that.

I want to talk about some of your past and some of the experiences that you’ve had over the last several years, specifically you’ve been in the positions of authority and influence. Let’s dive into The Third Pillar book that you came out with because I think they all tie together. Would you mind explaining first what the pillars are, specifically what that third pillar is and why you decided to focus the book around that pillar?

To some extent, I was looking at what I thought was possibly the most successful wealth-creating system we’ve had in history, which was the postwar liberal market society. That has three words, liberal, market and I would say, democracy is the third word. Liberal means the state which allows people to flourish. A state which is limited but does what it’s supposed to do to maintain law and order. The market is well understood. That to my mind is the second pillar. There’s society, there’s a community working through democracy to keep the system free, fair and open to everyone. The third pillar in my view is community, but it also implies democracy. It also implies a broader society, which essentially works together.

When you have these, you have the conditions for success as a society. Some people want democracy, but they don’t want markets. Some people want government and democracy, but they don’t want markets. In my mind, the three hold together. The first part of the book is trying to tell you why the three fit together. For example, an independent private sector flourishing in a competitive market is important because it acts as an independent source of the bar. It balances the mighty bar of the state. That balance is important, otherwise an overweening state has a tendency of becoming authoritarian. No matter what democratic structures you have, the state which is unbalanced by other parts.

Look around the world. When you see Turkey led by Erdoğan who has few constraints on his authority. You understand the private sector in Turkey is not much of restraint and understandably because the state controls many levers over the private sector, whether its ability to take away credit or its ability to refuse permissions here and there. You need a more open, flourishing competitive market where you can have the likes of the New York Times or The Washington Post holding the administration in check. You can have a Fox News holding the previous administration in check. You need these independent private sector powers. I’m not saying it’s ideal in the United States, I’m saying that the private sector is more independent than the other countries.

Your perspective is interesting, but I also believe it may not be the perspective that’s held by everyone. You have enjoyed a seed at seeing the world from many different places. I look at those that are in the community and how they’re viewing the challenges and the imbalance because most would agree that there’s an imbalance. When it comes to the environment, what you and I understand as the best environment and what a person that’s had no experience leading Central Indiana or Central Florida, having a limited perspective on things, they would want the same thing in the end. Yet they’re all disagreeing on the environment because that’s where you come in with a lot of AOC and Bernie Sanders and this notion of communism, which is a community. It comes to that third pillar. How has your experience over the years shaped the perspective on how strong you feel about a specific type of environment to allow this third pillar to be as influential as the other two pillars essentially?

How well you will do income-wise is not the same thing as how well you will do happiness-wise. Click To Tweet

It’s not my feelings. What is clear even in the United States, which is a country by many counts doesn’t emphasize the community anymore. Even now, you find that community matters. Some powerful work by Raj Chetty, an economist at Harvard, shows that which community you grew up in essentially determines what your income will be for the rest of your life. He does this by looking at kids that move between communities. You moved from a community which is low down on the performance scale to a community which is much higher up in the performance scale. It makes a world of difference in your life chances. Community matters even in the United States, where some people would argue the community is deemphasized.

Why does it matter? Because it gets you the start in terms of your early education, the early schooling you go to, the values you espouse, your identity, your sense of who you are and your ambitions. You talked about some places in rural Indiana, the ambitions of kids there and I’ve talked to a bunch of them are quite different from the ambitions of kids in New York City. In that sense, it does matter and it does set how well you will do going forward in your life. How well you will do income-wise is not the same thing as how well you will do happiness wise. There are differences between the two. In general, if we want capitalism to work, people, wherever they are in the country, should have the feeling that it works reasonably well for them. They’re not doomed right from the beginning because of where they started.

That’s our challenge because the requirements for participating in the capitalist economy have been increasing because of technological change. The skills you require are far higher than the skills a kid required 100 years ago. A high school education no longer cuts it. How do you get the skills that you need in the communities you’re growing up in? We can’t bring everybody to San Francisco and New York City. You have to have much more community-centered development. The problem is that it’s a vicious circle. When economic activity leaves a community, the big employer in town closes down. What follows is everything else starts breaking down. Your social relationships start breaking down, marriages break down, more divorces, more teenage pregnancies and more drug use. Your school starts breaking down and then you have a much lower chance of succeeding in the economy. Not just you, but your kids.

It’s a vicious circle. How do we break that vicious circle? We’ve had many areas like this in the country in the past, but they’re increasing. The question is how do we reverse this process? The answer is not lower interest rates. Similarly, it doesn’t mean have more fiscal spending. It typically means much more targeted, often bottom-up processes by which we rebuild activity in the community. Bring more jobs, employees and new skills. That means community involvement. It also means outside support, but we need to be much cleverer about this then we’ve been so far.

Maybe go through some of the research that you went through to prove out or to support your thesis. The world is rapidly evolving and you make certain claims regarding how the things of life are becoming much easier, whether it’s the food we have, transportation, or entertainment. It’s unprecedented as you compare it to 100 years ago or even 50 years ago. An individual’s fulfillment and their positive experience of life are being involved in making a difference and contributing in a sense. What things did you do to support some of the methods and direction of strengthening this third pillar?

TWS 02 | Community

Community: Because of technological change, the easy jobs in the middle are gone. You’re left with a choice of either the low-skill job or the high-skill job.


The phenomenon I’m pointing to is mental level phenomena. You point to a number of studies which point in the same direction, but the job of somebody writing a book like this is to write it all together to say, “Here’s the big picture.” The big picture can be summarized in one big causal factor. One pillar which is weakened therefore cannot respond. The causal factors, technological change is making such a huge impact on our life. In previous environments of strong technological change, the Industrial Revolutions, for example. Society responded in a big way and said, “Here are the things that have been touched by technology. Here’s how we should respond.” For example, in the Second Industrial Revolution. When you had big auto factories, chemical factories being set up. In the United States, you had a massive high school movement, which created a large number of high schools, but also made high school education free so that kids could go and get that education.

What is interesting is that there was also a time of a lot of immigration, but the immigrants who came into the United States were not well-schooled. They were experienced carpenters, they experienced plumbers. They had the experience, but they didn’t have schooling. They were not appropriate for the factories where you needed to know trigonometry to set the angles right in a machine that the kids that had gone through high school knew how to do. That’s how America dealt with the Second Industrial Revolution and many Americans benefited from that. I would argue that we need to figure out what the appropriate response this time is also. What you see is because of technological change, the easy jobs in the middle. The ones that required even a high school education. That was the technological revolution of the past and you could get decent incomes with that education.

Those jobs are disappearing. The manufacturing jobs, which were well-paid, unionized jobs, even the jobs and services. The job of a clerk who used to you have to know accounting, you have to know how to add and subtract and so on, used to fill large ledgers. That job doesn’t exist. It’s been automated. These jobs in the middle are gone. You’re left with a choice of either the low-skill job, you’re a security guard somewhere or the high-skill job. You’re a consultant at McKinsey. In between, it’s a long ladder, but there’s also not many on that ladder because the in between jobs are gone. How do we position people now for those jobs higher up in the ladder? How do we position them with the strongest skills?

That has become the central question. The problem is it all starts with the community. My colleague Jim Heckman at the University of Chicago was a Nobel Laureate in economics says, “By the time you’re five years old, you’re basically done for life in terms of your trajectory.” Because you had the early childhood health support that you need to keep you healthy through life. You’ve learned some of your habits. Your vocabulary is different depending on whether you grew up in a professional household or in a household which is poor where parents don’t talk that much. Sometimes there is a strong correlation between income levels and how much you can afford to have time to prepare your kids. Therefore, the life chances of that kid, even by age five, are different depending on how they grew up. In this world where it matters, for you to get those good jobs, you have to have that early preparation.

You have to go through a decent high school to be able to manage in college. It’s not enough that college has opened their doors to you. You can spend six years and dropout. One of the biggest problems in US education is the high dropout rate from college. These kids dropout with huge debt. Part of the problem is they’re not well-prepared for college in the first place. How do we get them that preparation? It starts with the community. That’s why I say we need to repair our community first in order to have a chance in this technological revolution.

Discovering happiness or fulfillment is the general desire of everyone to an extent. Click To Tweet

What are some of the ideas that may move the needle? It is quite an undertaking. One of your areas of expertise is behavioral science and how human beings behave in large part is habitual or subconscious. That’s where you’re making claims of where we derive our vocabulary, where do we drive our opinions on certain things. It’s not like you snap a finger, make an argument and suddenly people have a different way of viewing the world. From a community standpoint, making that shift, what are some of the ways that you see at least the majority of the community seeing things differently and making the subsequent change?

It’s a great point you make because it’s something that can’t happen from the outside. Somebody’s clicking their fingers out and say, “You’re the community, you got to pull yourself up.” What you see again and again is it comes from inside. You have to maximize the chances of it coming from inside, but you can’t force it from the outside. It’s a few people getting together. In the book, I talk about the Bilston Community in Chicago, which basically was crime-ridden. The number of deaths 100,000 was approaching the deaths in Germany during the height of World War II. There were drug wars in every part of the strip there. As one of the community activists told me, change came when they found a body outside one of the six churches and said, “This can’t go on anymore.”

The Pastor asked, “Who amongst you is willing to stand up? Who amongst you is willing to take the first step?” A bunch of young men came together and one of them volunteered to take on the task of community revival. The first task was essentially bringing down the crime. With that level of crime, no employer wanted to come in. They also did interesting things to arrest the crimes. For example, they found that much of the crime was localized in a few bars. They petitioned the city of Chicago to close down those bars in the neighborhood. They found that one of the problems was people didn’t want to call when they saw crime because they feared the criminals would go after them “Why are you ratting on us?”

They got a whole bunch of people to call the police at the same time and say, “There’s a crime here in progress.” They also persuaded them to get out of their houses. Crime flourishes in dark spaces, get out, light it up, come up and crowd the criminals out. It was a community effort, which brought down some of the crime. They did things like saving the local bank, which was going out of business. This combination of things helped them become more attractive and to some extent, they’re paying a modest price for that as a whole a lot of businesses are coming in. A lot of people from outside want to live in the Bilston neighborhood because it seems much more attractive. They are getting a little bit of gentrification. That’s not entirely a bad thing. There are some bad aspects to it in enforcing some old-time residents out, but they are going in the right direction.

TWS 02 | Community

Janesville: An American Story

It’s a perfect example. At the same time, you look at the root cause of that happening. It was a dead body in front of a church. Have you found in your analysis of the things that typically you have these events happen, like these earthquakes that shake a person and make them realize, the pain of staying the same is worse than the pain of changing and making changes. Did you see that as a fundamentally dynamic as far as how communities make the changes and adjustments that will strengthen their core and that pillar?

I’m not sure every community needs to have that wake-up moment. Some will, whether it’s drug abuse, crime or a large employer shutting down. There will be different triggers for them to see that, “Things can’t go on this way. We have to change.” There’s a nice book, Janesville, on how the big employer in town GM shutdown in Wisconsin Town and how the community came together. She leaves it where the community is trying to put things back together, but it’s not successful thus far. Since then, Janesville seems to have made some progress and things are a lot better than they were. In fact to the extent that the community police are issuing parking tickets. That’s a sign of development. You have so much traffic that parking tickets are being issued. More broadly, I would say the reason I emphasize Bilston is I want to say that communities that are far down and plagued by poverty, drug abuse and crime have found ways to lift themselves.

I see this in poor India that there are villages that decide, “We’re not going to depend on the use of government coming in and digging irrigation tanks and irrigation ditches for us, we’re going to do it.” It’s that old frontier mentality in the US that we’re going to do it because there’s nobody else is going to do it for us. That is a mentality, but in a developed country, there are many sources of help also. I’ve been talking, for example, to the Federal Reserve Bank of Philadelphia where they have an entire department which is trying to energize some of these community efforts. Bringing communities together, getting them to learn from each other. There are many sources. There’s a lot of wealth in this country and that wealth is sometimes in private philanthropic ways, for example, the Kaiser Foundation in Tulsa. In public ways we have something called the Opportunity Zone set up by this administration, which essentially offers tax benefits if you invest in communities that are falling behind.

There is help available, but it’s hard for Washington or some far away state capitol to understand what needs to be done in the community. The planning on what needs to be done has to become much more internal. Who would know that the significant problem in Bilston was a crime, that once you dealt with the crime, other magic would happen? It’s trying to figure out what are the two or three key impediments that if I fix it, it will set it back on a virtuous cycle and reverse the vicious cycle that locals know far better. There are many examples, some of which I cite in the book, but elsewhere of people thinking, “What can we do that’s different? What can we do to get the community engaged?” There will be failures, but it’s a way out which is easier in a developed country where the key is attaching yourself back to the national economy.

These are fascinating points. It’s something I think about a lot. I know that there are many others that are asking similar questions as to how is this wealth gap going to end up. It’s moving, but is it moving in the right direction? That’s where you have the primary narrative that exists that the federal government is the power of influence that should be fixing this problem and it continues to build. There’s a lot of movement, especially with the large part of the Democratic Party where the solution isn’t necessarily going back to communities.

The solution is using central powers to influence change through Universal Basic Income or redistribution of wealth. I look at how significant the claims you’re making. You’re trying to solve symptoms with those central-influence initiatives instead of the actual root of the issue. The world is evolving and just to see what the world has done in the last few years is incredible. You look at the central powers, it’s not reasonable for them to adapt to the rate of change that’s occurring because they’re far away and by the time a decision needs to be made, it’s too late.

I look at the significance of your perspective and what you’re making claims on as something that would move the needle. That was the intention of the United States in the beginning, wasn’t it? The reason for the 10th Amendment was to keep powers more local than federal. There are many other questions I have as a follow up to this, but I’d love to see how you’ve looked at the state of the United States when it comes to the immense amount of government power that exists. Their adoption of this role to solve problems and to make everything right. Do you see other signs of how this central influence is shrinking or do you see that there are still issues to be resolved there?

The development bar for every country is different because each country has a different set of resources, capabilities, and impediments. Click To Tweet

I don’t want to argue to your earlier point that there is no rule for the central government. Since Gerald Ford, every president has been the education president. How are we doing on education? Not very well. We need to figure out alternative approaches. I would agree very much with your thinking that central is difficult because the problem that each place faces is different. Some one size fits all policy device in Washington is not going to work. As support, central is fine. As a prime mover, it’s probably not what the doctor ordered for the country. This chimes well with the resilience and the self-empowerment of people, which has always been true in the United States.

I worry that in these communities, empowerment is feeling that sense of empowerment. That also leads to a different problem, which is that you look to the nation for your identity and for your answers, rather than for the people around you. That’s true in a number of countries. It’s growing in India also. When you start looking for the nation as a resolution and you become more nationalist in spirit. Nationalism is not a bad thing, but nationalism which looks for the enemy as the reason for your problems becomes problematic. It’s easy to point fingers outside, point fingers at minorities within the country, but that’s really no solution because it’s not them who are holding you back. It’s you that has to change. Part of the reason why I emphasize it back to the roots approach is it seems to me we need to rediscover identity back in our communities.

When I say this too many cosmopolitan people who dwell in big cities, they laugh. They say, “We left those communities long back.” In the United Kingdom, 80% of people still identify with their village or their town as their community. They’re not the rootless people that sometimes we see in cities. I’m not saying that’s a bad thing to be a citizen of everywhere, but there are many people who are a citizen of somewhere. It seems to me that they need to find ways to address their problems and we need to think about how that can best be done. This is why I say balance. It’s not all the central government. It’s not all the community. It’s not all the markets. Some balance between the three, which is going to help us get out of our problems.

The fact that this is not the United States problem. It’s a problem in France, in Germany, in China and it’s a problem in India suggest that we need a model for the world of the future. That’s in a sense what I’m trying to propose. At some level, some people have decided that, “Where’s the big tax? Where is the big government program?” These are all milk toast, but there is a big idea here which is let us focus on being a centralized government and governance as the way forward, rather than put more burden on a centralized government in a fractured society yet.

I love how you describe the community in which certain things take place. Going to the original proper role of government was to essentially protect this environment. That’s where obviously the Scottish Enlightenment had much influence on the Founding Fathers to develop the constitution and develop the environment in which commerce was to take place. We’ve gone away from that and it’s understandable. At the same time, there’s always a price to pay and we’re paying it because of how people believe things should be. I look at the future and it’s incredible what human beings have been able to create the potential in one mind can change the world and it could change a community.

TWS 02 | Community

Community: It’s a balance between the central government, the community, and the markets which is going to help us get out of our problems.


That’s an environment where you essentially have handouts or you have this theory that you should be taken care of. I don’t know if it ever leads to a person to discovering happiness or fulfillment, which is the general desire of everyone to an extent. That’s where you look at the examples that you cited, whether it’s Chicago or other places where people face adversity and figure out how to make adjustments and thrive because of that. It’s so inspiring but it comes down to the notion of forest and trees, because a forest is an abstract, forest doesn’t exist. A community is also abstract. It’s a group of people. The individual right and the protection of their rights is due to what the individual can create in the right environment if that’s what the overall consensus is.

I look at your experience and you obviously had a front row seat at the financial crisis of 2008 and 2009 and you saw what happens in how decisions at high levels can impact the entire world, which it did. Being a part of a higher education program at the University of Chicago, you come into these conclusions. It isn’t just you waking up in the morning and saying, “I’m going to write a book about this third pillar.” That’s why I find it fascinating how much you’ve experienced where things succeed and where things fail. I’m a fan and I appreciate all the work that you’ve done. Where do you propose your theories? What are you trying to achieve with this book other than getting the ideas out there? Do you have some initiative that you’re trying to push forward?

I’m starting that process and it starts first by publicizing the ideas, but then people start calling you and say, “Come talk to us. We were doing this stuff.” I’m learning more because there are many different ways that communities are coping. I got a call from a group at the World Bank, which is dealing with coal-dependent communities across the world and how they’re dealing with the fact that coal is largely on its way out. How do they recover and what different ways are different groups across the world doing it? This is a powerful way if they figure out what best practices are of trying to spread the word across the world. Here is how they have coped in Austria. Here’s how they coped in Australia. Therefore, let’s figure out whether you can do some of these things.

Part of what I want to do is figure out how you can emphasize more of the success and make it happen more widely. I do want to say that part of this comes from my experience in development. I said I grew up thinking why we are poor? As I looked at development and I studied it, one of the most interesting findings in development is the low explanatory power of influence from outside to how a country develops. You would think a lot of money coming into the country from countries that are giving money from across the world should make this country grow fast. It doesn’t.

For a variety of reasons, it has low power. What happens is when a country like South Korea says, “We’re going to make a change.” The development bar for every country is different because each country has a different set of resources, capabilities and impediments. It’s when they figure out that they need to make a change, it is when the rest of the world can be helpful by buying their goods, trading with them and so on. That idea has percolated into this book, that when you look at successful communities, we don’t know what the recipe is because the recipe is something they figure out because they’re close to the problem. You do know that it often has to come from inside.

Thank you for sharing. I wish you the best. It’s something that is a growing challenge. Humanity is fascinating to observe sometimes where we’re at and we’ve become a global community essentially because of the ease of communication. Sometimes ideas are where most of the power comes from. Getting an idea in a person’s head and then getting it to get out of their head if it’s the wrong idea or unprincipled idea, that’s a big challenge. I look at intellectuals such as yourself and other powers of influence, not necessarily from a central government standpoint, but whether it’s a media or authors that are rising to the challenge.

I was at a financial conference up in Whistler, Canada. Ray Dalio with Bridgewater and a massive hedge fund. The majority of his thoughts were directed toward taking some of his understanding of capitalism, free markets and being able to institute that in Central Connecticut to improve the poverty and crime situation there. It’s one of those things where the problems are getting to the point where they’re boiling over. People like yourself are making and going to make a difference.

Thank you very much. I do hope to stay engaged. I hope we get more people to start thinking about these issues.

Thank you, Dr.Rajan. It’s wonderful having you on and I wish you all the best.

Thanks for taking the time.

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About Raghuram Rajan

TWS 02 | CommunityRaghuram Rajan is the Katherine Dusak Miller Distinguished Service Professor of Finance at the Booth School of Business at the University of Chicago. He was the Governor of the Reserve Bank of India between 2013 and 2016, and also served as Vice-Chairman of the Board of the Bank for International Settlements between 2015 and 2016. Dr. Rajan was the Chief Economist and Director of Research at the International Monetary Fund from 2003 to 2006.

Dr. Rajan’s research interests are in banking, corporate finance, and economic development, especially the role finance plays in it. He co-authored Saving Capitalism from the Capitalists with Luigi Zingales in 2003. He then wrote Fault Lines: How Hidden Fractures Still Threaten the World Economy, for which he was awarded the Financial Times-Goldman Sachs prize for best business book in 2010. His most recent book, The Third Pillar: How Markets and the State hold the Community Behind was published in 2019.

Dr. Rajan was the President of the American Finance Association in 2011 and is a member of the American Academy of Arts and Sciences and the Group of Thirty. In 2003, the American Finance Association awarded Dr. Rajan the inaugural Fischer Black Prize for the best finance researcher under the age of 40. The other awards he has received include the Deutsche Bank Prize for Financial Economics in 2013, Euromoney magazine’s Central Banker of the Year Award 2014 and The Banker magazine’s Global Central Banker of the Year award in 2016. In that year, Time magazine chose Dr. Rajan as one of the 100 most influential people in the world.


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Entrepreneurship: The Season 2 Kickoff

TWS 1 | Individuals In Nature


Pulling metaphors from The Matrix to the life we have now, we can see the parallels of how we have been built into systems that ultimately stop us from seeing the opportunities beyond. As the second season kicks off, Patrick introduces us to a new topic we’ll sink our teeth into. We depart from capitalism towards entrepreneurship – specifically the entrepreneur and intrapreneur and the difference between the two. Prepare yourself for a new season that will question your assumptions on life, career, finances, and investments.

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Entrepreneurship: The Season 2 Kickoff

“The Matrix is a system, Neo. That system is our enemy. When you’re inside, you look around. What do you see? Businessmen, teachers, lawyers, carpenters, the very minds of the people we are trying to save. Until we do, these people are still a part of that system and that makes them our enemy. You have to understand most of these people are not ready to be unplugged, and many of them are so inert, so hopelessly dependent on the system that they will fight to protect it. Unfortunately, no one can be told what the Matrix is. You have to see it for yourself. The Matrix is the world that had been pulled over your eyes to blind you from the truth. The Matrix is a computer-generated dream world built to keep us under control in order to change a human being into this.”

I’ve always loved the parallel of our experience of life to the movie, The Matrix. As you and I begin a new season together, our focus is on a topic that is individual in nature. You’re going to question your assumptions about your life, your career, your finances and your investments. If you’ve read the previous four seasons, I believe you’re ready. It’s funny I used a Matrix quote in the book that I released. One of the editors actually made a note in their copy not understanding the reference associated with the red pill and the blue pill. That brings me to my next point. If you haven’t seen The Matrix, go see it because it’s a pretty cool movie. It’s definitely applicable to what we’re going to cover this season.

Our system of education from elementary school to middle school to college specifically, and how that creates this system of expectations when it comes to what we’re supposed to do after that, which is go to grad school or get a job and pursue a career. That career with its benefits, the desire to stop working and contributing one day, hoping that the financial markets and the 401(k) retirement plans will make us millions and be our retirement savior is this system that we are experiencing daily. Is that what you really want? Is that system giving you the fulfillment, joy and excitement that is possible? The Wall Street Journal had a piece about those who retire before the age of 62. I think it’s as applicable to those that retire after 62 or 65, but it made reference to the decline in longevity. Dying sooner than expected, having to do with the symptoms associated with unplugging from the opportunity to contribute and to provide value to others. Hopefully, you have gathered over the last few years and for those of you who have read the book, that I truly believe that whatever suppresses the human spirit to continually grow and expand through experience is one of the greatest thefts in history.

Uncertainty is one of those human needs that we all crave. Click To Tweet

On the other side of this system, that wall that prevents us from seeing what’s possible is literally infinite possibilities to give our life a constantly renewing sense of purpose from what we discover about ourselves and what we individually can bring in value to others, how that makes us feel, the financial remuneration that it gives us. That from what I’ve experienced, that red, is what makes us feel alive. This season we are shifting from the ideal environment of growth, which is capitalism. It’s the ideal environment of growth and expansion to what the individual can do in that environment. The theme specifically is the entrepreneur and intrapreneur. Let me talk about the difference between the two. The history of the entrepreneur is pretty fascinating. This is the definition that I like most. It’s the capacity and willingness to develop, organize and manage of venture with taking risks in order to be successful and turn a profit.

There was another term that when the idea of an entrepreneur or the word entrepreneur was used, it also referred to an adventure. I did an episode about the principle of uncertainty. Uncertainty is one of those human needs that we all crave. It’s the feeling of being alive, whether that’s riding a roller coaster or going to a movie or traveling to a foreign land. It’s something we all crave. That adventure spirit is within all human beings. I believe understanding, for yourself that is, because there are different degrees of it and it applies differently to different individuals. Understanding that sense of adventure and experience is part of what gives life its meaning. There is an economist, his name is Jean-Baptiste Say. He’s famous for Say’s Law when it comes to understanding the demand side economics or demand-driven economics. He identifies entrepreneurs as the driver for economic development, emphasizing the role as one of the collecting factors of production where they’re able to allocate resources from less to fields that are more productive.

I find entrepreneurship fascinating because if you think about it, what we experience in life on a daily basis, I think we often take for granted. Hundreds of years ago, what exists was merely a possibility. It was dirt. It was natural resources. Look at what we’ve taken as humanity and made into whether it’s television, video, lighting or the internet. Step back and put yourself in the position of a time traveler and travel from 500 years ago to now, it’s unbelievable to think about. It all started with a human being and another human being then another human being, being able to take our potential and apply that to the resources of life that we all have access to.

TWS 1 | Individuals In Nature

Individuals In Nature: There are opportunities to be entrepreneurial, to take risks and buck the status quo, to question authority, to question assumptions, and to question the system.


What does that have to do with you? The TV has been invented, the camera has been invented and the internet’s been invented. How does that apply to you? It’s not so much the actual application of entrepreneurial principles or the idea of entrepreneurship, but it’s adopting the mindset of solving problems, of making things better, of making things more efficient by looking at something and figuring out a way to make it better, to create more value. I believe this comes differently based on the individual. This is where I dive into entrepreneurship. Looking at entrepreneurship and intrapreneurship, this is where you fit in. You fit in because you have individual strengths, you have individual talents and abilities that you’ve been gifted with. It’s different for all individuals. You’ve had experiences up to this point that has given you an idea of what life is about. I think most of you are driven and you’ve discovered things that you’re good at based on how you feel, based on receiving some reward or achievement, or based on what others have said about you.

I believe that right there is one of those seeds of opportunity to be nurtured. With that nurturing, come incredible opportunities for your life but also for the level of satisfaction and the level of wealth that you achieved. This season, we’re going to get into a lot of topics that have to do with the changing environment, not from capitalism standpoint but the change in that system that Morpheus in The Matrix refers to. The system of education is changing rapidly. The system of business is changing rapidly. One of the guests I’m going to have on is going to talk to you about the majority of companies in ten years will have a majority of their workforce, 70% or more, as either working remote, as contractors or freelancers, pretty bold claims. In my experience, what I’m seeing out there is incredible.

I’m actually going to release an eBook that I’ve been working on for a while that is speaking to this future of work, the gig economy and all of the jobs that exist. The employment opportunities that exist that are either a contract, freelance or remote and what that allows is unprecedented. What that allows is for you to discover what are the details and job requirements of those specific opportunities and what can I do? What can you do to invest in yourself to obtain the certifications, obtain the experience and obtain the attributes in order to have one of those positions? What that allows you to do is work 15, 25 hours a week maybe less, do it on your own terms and mix in the lifestyle that you enjoy.

Understanding the sense of adventure and experience is part of what gives life its meaning. Click To Tweet

It’s not the typical way in which people think about their future. It’s the sacrifice of now for a better future. It’s putting money away into a 401(k), an IRA or the markets in hopes that one day they’ll be enough where you don’t have to work. I’m going to break it to you that working is a part of life but working in something that you don’t like doing and that you want to escape from through retirement, that’s your choice. Your choice is to do something you don’t like and you’re doing it by sacrificing enjoyment, achievement, pleasure and happiness for money. Because of where we’re going as a society, I believe that you can take very little money over the course of the next four months and you can learn more about yourself, learn more about what you’re good at.

We’re going to have some guests on here that represent some of the personality tests that are out there, Myers-Briggs, Kolbe, DISC, StrengthsFinder, so that you can start to discover where do you feel the most alive? Where do you receive the most fulfillment? What are the strengths that you have that you may not be aware of? How do you apply that to specific job opportunities, employment opportunities, whether it’s within the company you currently work for or outside of it or on your own? I’m not saying that entrepreneurship is for everyone. It has been an incredible journey from a positive standpoint, but I’ve equally experienced the other side of the spectrum where I had self-doubt, where I had relationship issues, where I had financial failures. Believe me, it is something that I know is not possible for everyone. It almost wasn’t possible for me and I’m still experiencing it.

Sometimes people can’t work for someone else. That’s where I categorize myself, I look at what’s right for you and that’s a question you have to ask yourself. You may have to ask it more than once. The idea of an entrepreneur is thrown out. There are entrepreneurship classes in school, there’s entrepreneur thrown through social media. I think the definition of entrepreneur definitely needs to be questioned, but that there are opportunities to be entrepreneurial, to take risks and to buck the status quo, to question authority, to question assumptions and to question the system. I believe that’s your responsibility. It’s my responsibility. That’s why the world exists the way that it does is because someone questioned why. Why does it have to be that way? Why do we have to communicate through just phone? Why can’t we communicate better?

Henry Ford said that if he was to ask people what they want, it would be a faster horse. An entrepreneur or a Henry Ford or whomever, the Wright brothers, they looked at what would make life easier, and they came up with ideas to make life easier. That’s where Say’s Law comes from. I believe that there’s an entrepreneurial spirit in all of us. I believe that there are ways in which we can grow, expand and achieve a better future for ourselves first and our family then our community, those we serve those who we provide value to.

The season is around this topic. We have those that are very reputable economists. We have authors, representatives from these different personality tests. We have a family of some of the most famed economists that are out there and the impact that their father specifically had made on them and have allowed them to see the world from a different standpoint. We are facing a lot of turmoil in society right now. There’s so much communication out there, sometimes it’s hard to know what to believe. I look at issues, whether it’s in Venezuela, issues that are in China or in Russia. I also look at issues that are in the United States where you have these political influences that are very compelling. They speak well, they’re good marketers. Their narrative is compelling. At the same time, I believe that politicians will always be politicians. There’s always an agenda behind the scenes. Understanding principles, understanding what life is about is going to allow you to ask better questions. It’s going to allow you to support those people that align with your values.

In the end, what I’ve discovered in meeting with thousands of people and doing business with thousands of people interacting with authors, reading hundreds of books, is that most humans, if not all, have something very similar in common. They want a feeling of achievement, happiness and satisfaction that does not come from a job with benefits. It does not come from a 401(k) or putting money in the stock market. It does not come from retiring. I believe that it comes from you discovering what you’re about, what your strengths are, your abilities are and taking that and applying it in a way that allows you to live a lifestyle that you love.

An understanding of what life is about is going to allow you to ask better questions. Click To Tweet

I’m excited to have some of these interviews. I’ve already had a few and I think you are going to love them. I’m also going to try to be more interactive. Check out the YouTube channel and also on social media. Make sure you’re sharing this stuff. If you like what you hear or see, we want to get the word out. If you haven’t already, read the book that I released, Heads I Win, Tails You Lose. You can get a free couple of chapters. I can’t wait for you to experience that book. A lot of the principles I’m going to be talking about and I talked about last season, the theme of capitalism. The seasons in 2018 were Life, Liberty and Property. These are things I’m passionate about and I want to hear from you. I want to make sure that you understand the material and you’re getting something from it. Make sure you start interacting, make sure you’re giving me feedback through the different channels. I can’t wait to experience your journey just as much as I can’t wait to experience mine. Thank you and we will be back soon.

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