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Uploaded:2009-10-11
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http://www.kiva.org

In which John defends capitalism, the free market, and economic growth with the help of Bubbles the Nerdfighting Puppy, who suffered the emasculation and humiliation of an elephant costume with great aplomb.


HERE ARE A LOT OF LINKS TO NERDFIGHTASTIC THINGS:

Shirts and Stuff: http://dftba.com/artist/30/Vlogbrothers
Hank's Music: http://dftba.com/artist/15/Hank-Green
John's Books: http://amzn.to/j3LYqo

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Hank's Twitter: http://www.twitter.com/hankgreen
Hank's Facebook: http://www.facebook.com/hankimon
Hank's tumblr: http://edwardspoonhands.tumblr.com

John's Twitter: http://www.twitter.com/realjohngreen
John's Facebook: http://www.facebook.com/johngreenfans
John's tumblr: http://fishingboatproceeds.tumblr.com

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Other Channels
Crash Course: http://www.youtube.com/crashcourse
SciShow: http://www.youtube.com/scishow
Gaming: http://www.youtube.com/hankgames
VidCon: http://www.youtube.com/vidcon
Hank's Channel: http://www.youtube.com/hankschannel
Truth or Fail: http://www.youtube.com/truthorfail

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Nerdfighteria
http://effyeahnerdfighters.com/
http://effyeahnerdfighters.com/nftumblrs
http://reddit.com/r/nerdfighters
http://nerdfighteria.info/

A Bunny
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( - -)
((') (')
Good morning, Hank.

It's Sunday; it's news day and the news around here is that my house is a construction zone and most of the electricity is turned off and we don't have any place to sleep. And, unrelated to the incredibly expensive home renovation, my basement flooded on Friday, so now I have to take out all the carpet and fixing it is going to cost a billion dollars and I'm cranky! And when I get cranky, I put Willy in his tiny elephant costume.

Oh, hey! Two quick things. I will be reading and signing and hanging out with fellow made-of-awesome nerdfighters this Tuesday at a book store in La Grange, Illinois.

And, next Tuesday at the library in Columbus, Ohio. Both events are totally free. Please come.

More info in the dooblydoo. And now, back to your regularly scheduled intro. Okay, Hank.

Today I wanna talk about elephant puppies and capitalism because capitalism has had a bad go of it recently, like failure to regulate the free market is being blamed for the great recession and for the screwed up American healthcare system and a lot of other things. And I happen to think that the free market is in many ways a great thing. So for one news day at least the giant squids of anger are going to stop screaming about how I'm a left wing communist and start screaming about how I'm a right wing fascist.

Off topic, but, Hank, do you remember that band "The Left Winged Fascists" that we liked when we were kids? They were awesome. Right, so but okay, let's say you have a dollar and let's say you decide to spend that dollar buying fabric and thread and needles and whatever else you need to build a puppy-sized elephant costume for a puppy.

Then you sell the puppy-sized elephant costume for $5. You go out, you buy enough fabric for 5 costumes, which you sell for $25, giving you enough money to make 25 costumes, which you sell for $125, and so on until you're rich. At least until you lose all your money in the great basement flood of 2009.

Although then, thanks to the free market, you'll be able to get competing bids from multiple contractors so that solving your basement problem, while it will cost you so much money that the only way to cope will be to dress your puppy up as an elephant, will be as cheap and efficient as possible. Anyway, capitalism isn't actually that simple because the actual functioning of capitalism is based on debt. In the real world, you probably won't be able to scale up the production of your puppy-sized elephant business without at some point borrowing money.

Maybe you don't have the dollar you need to build the first costume or maybe you need money to build a highly automated factory that will produce puppy-sized elephant costumes cheaper and more efficiently. At some point you will have to borrow money, which you'll have to pay back with interest. But if your business idea is a good one, like, say, elephant costumes for puppies or, say, penicillin, you'll be able to pay back the loan with interest and still make a profit.

And the weird thing about that is when loan capital flows freely, wealth gets created. Now, of course, an unregulated free market can also lead to decreased economic activity, like, say, if the sight of a puppy in an elephant costume is so transfixing that people who own such costumes find it impossible to leave their houses in order to go to work. Which is basically why heroin's illegal, but that's another story.

The story today is that, on average, people who live in countries with freer markets get richer over time because those markets create wealth. That's why micro-finance works. Through websites like kiva.org--link in the dooblydoo--, people like me are able to loan money to entrepreneurs in the developing world who live on less than a dollar a day.

And then those people can have the capital to start a small business and then pay me back with the revenue that business generates. Loaning money to poor entrepreneurs almost never costs the lender anything. The loans are repaid 99% of the time.

So you can loan the same $25 over and over and over again and you get to watch the free market work. And it does work. Hank, money can't buy love but it can buy longer, healthier, more secure lives.

And ill-fitting puppy costumes. It's an amazing feeling to watch these tiny loans bring people out of poverty all over the world. And because it's a loan, and they repay me, it doesn't even cost me anything.

So, Hank, that's Willy's defense of the free market. Nerdfighters, if you wanna see a made-of-awesome free market in action, you can go to kiva.org, and, Hank, I'll see you on Tuesday.