Transcript
The Jacobsen Group with Jon Jacobsen · Tue Jan 13, 2026
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Economics is the study of human choice in the world we live.
Faith is confidence in what we hope for and assurance about what we do not see.
By investigating faith in economics, we can learn how they lead to human flourishing.
This is the Faith in Economics podcast, a presentation of the Gortney Institute at Ottawa University.
Hi, and welcome to our show.
I'm Justin Clark, the Menard Family Professor of Philosophy and Ethics.
I'm joined by Dr. Peter Jacobson, the Gortney Professor of Economic Education and Research, and Dr. Russ McCullough, the Wayne Angel Distinguished Chair of Economics and the founder of the Gortney Institute.
All right, so C.S.
Lewis is a guy who did a lot of writing.
Probably the one of the quintessential...
Apologist for Christianity and was very influential during wartime.
And so he influenced a lot of veterans during World War II by coming on the radio and doing some talks.
And then I believe those eventually turned into a lot of the content turned into the books that he wrote.
So The Lion, the Witch, and the Wardrobe was my first book I ever actually read.
I wasn't much of a reader, so I think that was sixth grade or something.
And I don't even think I really understood or cared about the Christian angles on it at that time of my life.
And then the screw tape letters was very influential for me when I was 18 or so, really getting my idea of...
Evil and the devil and kind of how the devil might go about his business in a very clever way with Lewis's writing so but today Peter you wanted to talk about the abolition of man So what do you got on your mind?
Yeah, so I recommend everyone read it even after we talk about it Lewis presents his arguments better than I could but I think it's a relevant argument I think that as often as the case
One of the reasons that Lewis has stood the test of time is that he happens to be pretty prophetic.
I don't think that's true of every great writer who stands the test of time, but I think that's one of the reasons Lewis has.
And so Lewis has this short, it's a book, and you could call it a booklet, but it's usually, you know, publishes a book.
The PDF I have in front of me is only 42 pages.
The actual, if you get the printed book, it's like 120, but with this generous spacing.
So it's just short, a read.
And.
The way the book starts I thought was a really interesting hook so that Lewis is addressing two scholars who've written a literature textbook for like graduate students in literature and he, Lewis is such a gentleman that he gives these people pseudonyms so that way they are not identified because he thinks they've done something very terrible and he wants to harangue them but he doesn't want to do it publicly.
People have since figured out who these people are but he calls them Gaius and Tidius and he calls their book the Green Book.
And here's his main criticism, with respect to the Green Book, is that these literature professors say that when describing a waterfall, they say, imagine two different descriptions of the waterfall.
One person comes up to the waterfall and says, this is pretty.
And the other person comes up to the waterfall and says, this is sublime.
Or, yeah, this is sublime.
And so...
Lewis's argument is, well, actually the textbook authors say that it is more proper to say this is sublime than this is pretty.
And the reasoning is thus.
Sublime describes your inward state, how you feel about the waterfall.
And so they say it's more proper to say this is sublime about the waterfall because you're describing your inward state.
To say this is pretty is to try to describe the waterfall as having the objective value of being pretty, which they say is incorrect.
They say, well, the waterfall actually doesn't have the objective state of being pretty.
That state exists in you.
And saying sublime communicates that more properly.
And Lewis thinks this is a terrible thing.
what they're saying here and here's the reason Lewis thinks it's a terrible thing is because what they are doing in an English textbook is making the claim that objective beauty does not exist and they're disguising it as literature and what he says is that this argument that they're making actually doesn't even hold up internally and so their argument remember is saying it's okay to describe your feelings about the waterfall with the word sublime
But it's not okay to describe the waterfall itself because you're projecting something onto it, which isn't there.
So they're trying to argue that this is like improper, like literature, you know, making.
Yeah.
When you said English book, it was teaching people English.
Yes.
The
proper test.
Okay.
But Lewis argues about this for a lot of reasons.
And one of the reasons he points out very early is that, well, these people are saying that we can't say as a matter of fact that this external thing, you know, is pretty.
But
because we can't say objectively who it is but to say it's a blind actually also carries an objective statement in it about the feelings that we have that is to say this is a blind assumes that our feelings are a certain way and so really what they would have to say is well my feeling about my feelings are that this waterfall is a blind and so this creates some sort of like you know infinite regress that you would have to say have to hold in other words what guys in tedious are doing according to CS Lewis is
applying a standard about how we should describe the world, which actually doesn't even make sense.
It's refusing to ascribe objective reality to things.
But actually, as a matter of fact, even the statement like this is sublime ascribes objective reality to our feelings too.
So there's no escaping the idea that you have to impose your values in language.
To say this is a blime is to do the same thing to your feelings that saying this is pretty does to the waterfall.
in other words.
And so this is one reason that he has a problem with this statement.
Another reason he has a problem with this statement of just this is sublime rather than this is pretty is he argues that well the authors actually do believe in like having and they do outrightly say that like they're opposed to this idea of like these this objective like center to the values and rather it just exists in the feelings of the person.
But Lewis says even writing the textbook requires that these authors
actually either embrace some sort of objective value that education is better than non-education, or they're just like merely following like their own like random preferences at the time.
And so Lewis's point is just this, waterfalls actually can be pretty.
and there's an objective quality to beauty and to try to construe English as a means of arguing that there isn't objective beauty, but rather that, you know, everything that exists is just our projection of our feelings.
This is ultimately self-contradictory because then we're saying that there are objective things in our feelings.
So we can't really say we have feelings.
We have feelings about what our feelings would be, but then you'd have to say we have feelings about what our feelings about what our feelings would be and so on.
And so, you know, this is one minor example, but he uses this example to make a broader point, which is this, is that the purpose of education should not be to equip somebody with some sort of like neutral, you know,
tool but rather Lewis's view in order to educate you actually have to provide the right values and so He argues that maybe these two people have been swayed by emotional propaganda.
They think that they That emotions are leading people and so young people are biased towards emotions and they're just trying to school that out of them But Lewis says actually the opposite is kind of true.
We live in a world of coldness in vulgarity and so
Lewis says, the task of the modern educator is not to cut down jungles, but to irrigate deserts.
And so I think ultimately, and by the way, he drives a lot of things from this.
And so I'll bring up the last thing before I kind of push it off and we could talk about some of his other results.
But ultimately, what Lewis says this results in is the idea of we are going to live in a world of men without chests.
And what he means by men without chests is we have kind of three components.
We have our stomach, we have our head, and we have our chest.
And so our head is our intellectual side, our ability to analyze things.
Our stomach is our appetites.
Things that we sort of like emotionally or we could even say instinctively if we want to feel like we need.
And then the chest is kind of the emotional seat of the body.
That is it's like the regulator that kind of works between our intellectual side and our just base appetites.
It's where for example people assess morality, right?
And so people assess morality, Louis says, from the chest.
And so Lewis's argument is that what Gaius and Titius are trying to do is they're trying to claim that they're expanding the minds.
But really what Lewis says is they're not expanding the minds, they're just shrinking the chest.
And he says, there's a good quote here, it's not excess of thought, but defect of fertile and generous emotion that marks them out.
Their head is no bigger than ordinary, it is the atrophy of the chest beneath that that makes them seem so.
And so to give you a literary example, not literary, a creative example of what a man without a chest is, it's like a Vulcan, right?
If you watch Star Trek, the Vulcan is a man without a chest.
He has all the intellectual power.
He has certain appetites at certain times, but he has no emotional seat through which to like govern.
He has no means of, you know, making non utilitarian calculations or something like that.
So I'll stop there.
There's a way more in the book, but to see, you know,
And what I'm saying is in what I am currently saying, making sense.
Do we follow it?
Do we agree with it?
What do we think?
Justin, I was waiting for you to jump in first with
sounds like
there's subjectivism and relativism and maybe seeking the truth or not finding the truth because of thinking that way.
I don't know.
Those are like little things, but I want the philosopher to go first.
Yeah.
So he's talking about at least what at least what he's talking about is closely mirrors a debate about certain ethical theories in the 20th century, notably.
Expressivism in aesthetics and in ethics and that seems to be what he's attacking and actually think his first attack isn't going to land against sufficient or sophisticated expressivist but the second attack is the attack that you know we give in.
philosophy is like one of the reasons why expressivism doesn't seem to work.
So, expressivists say that when we attribute a moral or even in, you know, this transfers to aesthetics too, which I take it was the main target of CSU.
critique here.
But when we say that something is beautiful or that something is bad or immoral, what we're really saying, even though the surface grammar of the sentence says, for instance, murder is evil, what we are actually saying is something like boo murder or murder makes me feel bad or something like that, right?
Yeah.
Now, it seemed like the line Lewis was taking was something like, if these people are saying that nothing is objective,
They can't say that because they are then attributing objectivity to at least their knowledge of their own internal states,
right?
Yeah, that's one of the critiques.
Yeah.
Yes.
And that's the first critique.
And the reason why I don't think that's going to work against an expressivist is they'll go, yes, exactly.
I do I do have direct access to my own internal states.
And so I can be sure that murder makes me unhappy or whatever.
But I'm also sure that murder isn't a property out there in the real world.
And our direct knowledge of our internal states, this follows some like
from some stuff Descartes said or whatever.
And I tend to not think that it's correct that we have direct and omniscient knowledge of our own internal states.
But that's why I think the better line to push is the one that I think he pushes second, which is something like, well, it seems like when we are, if you ask somebody what they mean when they say, you know, the waterfall is beautiful or whatever,
they just aren't doing the kind of thing that expressivists say.
They're not describing their own emotional reaction.
They say, no, no, no, I mean the surface grammar of what I'm saying to actually describe the waterfall.
I'm saying of the waterfall that it's pretty, right?
And so the other tack that
And these are two flavors of moral nihilism.
The other tack of nihilists say, yes, the surface grammar of all these sentences is correct.
It's just they're all false because all of these attributes aren't out there in the world.
There is no property of prettiness or whatever out there.
And so the choices for people who want to say that beauty isn't real, you either become an expressivist or a nihilist.
And the thing to note about expressivism is that it's
actually impossible if expressivism is correct it doesn't make sense about there's no sense to why we argue about these claims which is if you say that waterfall is beautiful and I go that waterfall is hideous or you know murder is wrong or you know abortion's immoral we argue about these things and we don't argue about claims when I say
Yeah, blue cheese isn't my favorite, right?
I think you're wrong about that.
And it's usually taken to show that, no, when we make moral claims and aesthetic claims, we are attributing these properties.
to the thing out there in the world.
We take these seriously.
We have disagreements about them.
And we wouldn't even be able to have any of these disagreements if the grammar were really the way the expressivists are talking about it.
And it makes it impossible to have any disagreements.
And I take it that maybe this leads to this chestlessness thing that you're talking about is like, you don't have to be responsible or defend your emotional response to the world if,
On your view, that isn't connected to the way the world is whatsoever.
Yes.
And actually, Lewis gets there eventually.
There's kind of three major parts that happens in part three.
So I think you're following it well.
Russ is trying to cut us to break here, but I will lead or leave off.
with one thing that we can continue as the next which is Lewis then goes on to argue the major problem with this is it robs people of the sort of thing that like are worth fighting for or defending in other words taking away the emotion of the the truth of beauty or as Lewis calls this truth by the way he calls it the towel so after the break we should talk about what the towel is when you pull that away you remove all reasonable sources of virtue
The man without chest becomes a man without any virtue because he doesn't have access to motivation for his virtue.
All right, sounds good.
I do have some clarifying questions and then we'll press on.
We'll be back in just a bit.
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Okay, so we're back and continuing on the discussion here with what it means to live without a chest and I wanted to.
Have you clarified, does that mean like you're losing your courage a little bit or your boldness of wanting to take action with what you're thinking?
Does it result with that or does it?
Is that part of what Lewis is getting at?
That's one thing you lose.
Any virtue sort of like exists in the chest.
In other words, if you appreciate something in the world for how it is, the beauty of a waterfall, the innocence of a child, like these sorts of things.
If we say that these things don't actually exist, but rather they're just the products of our feelings, then all that remains is our base appetites and our intellect.
In other words, if we don't have a pursuit of beauty, we have a pursuit of our appetites instead.
And so the brain no longer serves this objective thing that we call beauty, but rather just our instinctual preferences.
For example, here's maybe an example.
It's like, if we believe that people are fulfilling their highest end better by being physically fit,
That would be something that Gaius and Titius' claim would exclude, essentially, because to them, there's no such thing as a beautiful body or an ugly body, right?
That's just our perceptions of the things.
Well, if that's the case, then the only thing that exists is our brain and our brain's ability to fulfill our appetite.
So we might as well just eat, right?
There's no point in being physically fit.
There's no point in exercising.
unless that just happens to be what your appetite is, but there's no adjudication between these things without the objective standard.
If there's not a better body, then there's no reason to not gorge yourself and eat 400 pounds, except if you want to do that.
And that's all that remains is, what do I want to do today?
So that's what you remove.
And it could be courage in certain circumstances, right?
Okay.
So this brings Lewis' second point to bear, which is that Lewis says that the reason in truth is wrong to say that the waterfall is not pretty is because it is pretty objectively.
Like Lewis' claim is that actually there is objective beauty in the world.
And he says the source of subjective values is something called the tau.
And so the Tao is taken from Taoists.
It's called The Way.
That's the translation.
And Lewis in the book is very explicit in saying, I'm not going to argue that you have to be a theist in order to accept the Tao.
He does that elsewhere.
So he does believe that.
But that's not the purpose of this book right here.
But he says, the Tao is the set of values that are true that if you look across societies, basically all people share.
And he's very clear to make the comment that it's not because all people share this that it exists, right?
He's not arguing from some sort of democratic perspective.
He makes lots of arguments about why the Tao exists, but he points out like he's gotten appendix with like a bunch of like people who believe, you know, certain things throughout time in different cultures, different religions.
So he has the law of
like duties to parents, elders, and ancestors.
He has something from the ancient Babylonian, from the Greeks, from Hindu, from ancient Jewish, and so he's got this appendix of all these values.
But he says, if you exist in the Tao, then you have objective values through which you can critique things.
If you don't exist in the Tao, if you reject the Tao, your only recourse is to actually to use some parts of the Tao to critique other parts of the Tao and pretend like you're not doing that.
And so,
For example, Gaius and Tidius, they're arguing that beauty is not objective in this way.
How are they doing that?
Well, they're doing it by saying that there is a true way to use language, and that true way to use language can critique the truth of beauty.
But of course, what Lewis is saying is, well, actually, if you don't have a set of objective values, then you can't say that there's a true way to use language, right?
That the true way to use language is ultimately in the subject in Gaius and Tidius's view.
And so,
Ultimately what Lewis is saying, and I'm not perfectly characterizing that part of the argument.
I'm trying to kind of summarize it, but ultimately what Lewis is saying is that in order to critique objective values, you need objective basis for the critiques.
And Lewis says everybody who is doing that is borrowing from this thing called the tau, which is all the objective values that exist out there.
So ultimately not abiding by the tau in Lewis's mind is very dangerous because what it leads to is we can't say things like or we can't
but provide foundation for things like sacrificing yourself for others.
So a soldier who sacrifices himself for others, what is the fundamental basis?
And he argues, well, you know, it actually can't be instincts.
And he gives lots of reasons for that.
He kind of goes through the common objections.
And so ultimately, I'm sorry, I'm trying to look for one place in here that I think is a valuable
last comment for me to go in.
I think I would have to come back to it.
But he says ultimately the people who critique the Tao
are the people who are leveraging the Tao without acknowledging it.
And he goes through a bunch of examples of people trying to critique moral realism or the realism of beauty and these sorts of things.
And he highlights how their arguments all require them to accept some piece of objective morality or some piece of objective valuation before they continue it.
So I'm going to let this off because I want to find that quote, but I'm not just going to ramble while I try to read at the same time.
So I'm a little confused on if it's some sort of spectrum.
So there's got to be maybe Justin can speak to this a little bit on beauty.
So I'm with the objective beauty thing.
But then I also think of sin corrupting humans perception of beauty.
So somebody who's, you know, hurting themselves and they're burning their skin and they might say something like, I think it's beautiful to see, to feel the pain and to see the, you know.
to harm myself.
Like there's some sort of beauty in it.
So I think part of the question is, is am I the objective?
Some things are beautiful.
Like it seems like the average person would say, no, you're crazy and burning yourself.
That's not beautiful, right?
And so is it the majority of opinion that brings that?
Or is there just a corruption of that person through sin that is making it perceived as beautiful?
I don't know if that's very well worded or
not.
I don't know what the question
is.
Well, so if the waterfall is, if it's objectively beautiful or that's a truth of some sort, you know, like you said, some people will say it's not beautiful.
And then I'm trying to bring out kind of the other end of the spectrum where most people would say something's not beautiful, but a few people do.
And so where is the, where is the difference between subjective beauty and objective beauty?
Typically, we think that a claim is subjective if its truth depends on whether or not a certain person believes it, right?
And an objective claim is these have to do with truth conditions, right?
What makes it true?
And the way like for claims in ethics, when we start teaching ethics, it's a well-known phenomenon amongst philosophy teachers that almost all of our students come in
being both relativists and objectivists at the same time and also with aesthetics.
So they will say, I'll say like, beauty is what?
And they'll go in the eye of the beholder, right?
That's the statement of subjectivism or a kind of relativism with regard to beauty.
That says what makes something beautiful is that the person perceiving it thinks it's beautiful, right?
Beauty isn't in the object, it's in the beholder.
Yeah.
And objectivism says, no, no, no, beauty's actually in the object.
It's a property that we predicate of things.
And many people note that a good argument or, I mean, the best argument in favor of subjectivity with regard to beauty is the claim that not everybody agrees on what is beautiful and what isn't beautiful, right?
We have disagreements about whether the Mona Lisa is more beautiful than the David, etc.
But the problem, though, is that if relativism is correct,
The arguments don't even make sense.
And it's not the case that disagreement isn't necessarily a problem for objectivists.
We can say things like, beauty is a real property out there in the world.
What we don't have is a really good scientific ruler for what to quantify beauty.
But that doesn't mean it's not out there.
We can easily say things like, well, the Mona Lisa is more beautiful than a pile of corpses from the Black Plague or whatever, right?
If relativism or subjectivity were truly correct, it's not only that we would have disagreements about what's beautiful or not.
We wouldn't seem to have any agreement on anything being more beautiful or less beautiful than anything else.
It would all be completely arbitrary.
And what we do see in the real world, as Lewis notes, is that most cultures actually do have a lot of agreement about things that we consider right and wrong and beautiful and not beautiful.
And
even if we want to be hardcore scientific rationalists about it, that ought to count in favor of the fact that we are therefore responding to properties that are out there in the world, even if we don't have a scientific device to measure those things and divide the measurements into units or something like that.
And if we don't concede that, then the only other way to handle that data is to say, well, actually, then every experience is like beauty and subjective, right?
So either
we're all reacting to something that's in the world, or when all, like when we react to hot and cold, that must also be subjective too, which is, Lewis's next point is like, you know, we all react to hot and cold the same, but that's also subjective just like beauty, right?
And so- Wait till you meet the idealists.
Yeah.
And so hopefully the point, again, Lewis does a better job of connecting this than me, but his argument is that, well, this denial of beauty or the denial of things like that your country is worth defending or that humans are worth defending.
ultimately causes us to lose things like self-sacrifice.
And Lewis says, well, then what can the folks who follow the Green Book say?
Well, they could say something like, it's for the survival of the species.
But of course, that leads us to the question, why should the species survive?
And he gives a long time on these kind of behaviorists will say things like, well, it's because the survival of the species is our instinct, right?
But Lewis pretty, I think, soundly diminishes that argument by saying, well, actually we have competing instincts, like all the time.
There's all sorts of instincts when we use it very broadly, like you have one instinct to eat, one instinct to socialize, maybe they conflict.
The point is you have to choose between your instincts, right?
If you're in a battle, you may have an instinct to protect your friend, but you also have an instinct to run away.
So you can't appeal to instinct as the reason that people are self-sacrificing for the species.
And he says, if you can't appeal to objective valuation,
Well then actually you don't give people a reason to.
Here's the quote that I was looking for earlier.
So this is the upshot of what Lewis is arguing on a personal level.
Then he has a societal level, which I'll come to.
He says this is the tragic comedy of our situation.
We continue to clamor for the very qualities we are rendering impossible.
You can hardly open a periodical without coming across the statement that our civilization needs more drive or dynamism or self-sacrifice or creativity.
In a sort of ghastly simplicity, we remove the organ and demand the function.
We make men without chests and expect of them virtue and enterprise.
We laugh at honor and are shocked to find traders in our midst.
we castrate and bid the gildings be fruitful.
And so again, the argument being here is like we're taking away people's claim that there's an objective truth, that like we're fighting for objective goodness or objective beauty, and then we expect them to still fight.
All right, well, this has been a production of the Gorton Institute
here at Ottawa University.
I'd like to thank you all for listening.
Five Star Reading helps other people find us.
Otherwise, just pass this along to friends and family that might like to take a listen.
Other than that, be fruitful and multiply.
Thanks.
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Well, welcome back on this beautiful Saturday here in January, John Jacobson, the Jacobson group.
And guys, it's great to be a Hawkeye.
Wow.
How about that women's and men's basketball teams, but that huge bowl victory for the Hawks.
Kirk Farance and the guys dominate the SEC.
A great, great bull win.
Kirk now with 11, all-time Big 10 record for most bull wins.
He's over a 60% lifetime coaching for victories and not one Hawkeye.
player was sidelined during that bowl game.
They all elected to play.
Well, guys, guys have elected to play for a half century.
Are the great people at Hames Homes founded by my family's friends, Kurt and Norma Hames, the late great Kurt and Norma Hames.
Now this multi-generational family continues today with a member of that third generation, Mr. Clint Hames.
Clint, I'm so glad to have you back with us today on the mighty blowtorch, Caxiel.
caroming to 20 states and four Canadian provinces just on the AM band.
How are you Clint?
Great.
It's a beautiful day.
Well it is and you know what's really wonderful is this signal both on 1540 and 100.5 carams all throughout
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You have the beautiful, safe, affordable homes there at Summit and Grandview in Southwest Cedar Rapids.
What's new today at Hames Homes?
Clint.
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No, that's a great list that you've already started.
I'd add in, we've got an amazing dog park in a Grandview community.
Awesome.
Each park has
two playgrounds for kids.
Excellent.
Just save clean communities.
A little bit of something for everything, including a senior breakfast on Friday morning.
Wow, that's fantastic.
And you kind of vet the neighborhoods to make sure that they are safe and secure.
You run background checks to make sure these are good peeps in here, right?
Right, exactly.
And that's on all adults, not just the homeowners, but all adults living in the community.
Awesome.
Awesome.
What impressed me was the infrastructure.
You've got beautiful streets and lighting.
It just looks like the infrastructure is top drawer and it's got to be because during the derecho when other
what I call the regular homes had rifts blown off and siding peeled off.
Your homes did spectacularly well.
They're affordable as you alluded to, even interest rates going down.
They're beautiful, but man, they are safe homes at Hames Homes.
Yeah, that's absolutely right.
I mean, we've got a service team that reconditions our pre-owned homes before we sell them.
So a lot of times you're going to get a new furnace, a new air conditioner, new water heater.
We check all the plumbing.
We do it all and we want to sell a good quality home to anybody who's interested in buying.
Absolutely.
Well, Clint, I know this because my dear mom has a phone number.
I almost identical to your legacy, uh, Marion phone number and my father's dental practice, of which your family were, were all patients, had a nearly identical number.
Give out this wonderful phone number that the folks can reach you guys at.
Yes.
319.
377-4863.
Yeah,
guys, 319-377-4863.
And Clint, I love your website.
There's a great blog site that you encourage us to trade off on.
There's a wonderful tome up there right now on how Hames Homes helps with New Year's resolutions.
You guys do that, don't you?
That's certainly right.
You know, there's a lot of a handful of tips in that newsletter, getting more sleep, producing stress.
Of course, the
One that seems to be the most popular is exercising more.
Exactly.
And there's plenty of room to do it out there.
You even got a Frisbee park, plenty of place to walk, parks for the kids.
And Clint, people should stop over and drive by and look.
at the scenic beauty and the proximity to everything from the airport, to the hospitals, the university, to retail shopping.
Where can they find Summit View and Grand View?
Give them a benchmark address or crossroads for them to tool on out in their vehicles and take a peek.
Yeah, absolutely.
So some of you is actually right along Wilson Avenue, Southwest.
just off of Wiley Boulevard and then our Grandview office, which is our main office, we're on the corner of Wilson Avenue and West Post Road, Southwest.
There you go, and they can come in and talk to you or to Curtis.
If they've got questions about insurance or financing, you guys are ready to roll with the paperwork.
You make it easy to do this transaction.
Absolutely.
You can also reach us through email at sales at hamshomes.com or on our website has a lot of additional information about financing and insurance and all the homes that we have available.
Guys, don't forget that email address sales at hamshomes.com and of course that wonderful website hamshomes.com H-A-M-E-S H-O-M-E-S
And I think it's going to be a great year.
I think interest rates are going to continue to trend down.
And Clint, I think that will open up even more affordable opportunities for folks there at Hamasomes.
This is the time to do it.
It's a New Year's resolution.
People need places for their University of Iowa grad students, young married couples,
Seniors that want to downsize, like my wife and I are in that mode now, you literally have got spatial coverage for every generation of homeowner and resident,
Clint.
yeah absolutely right
well guys his last name is hams and that's good enough for me because i remember the great curtain orma and then troy and barb and uh the other members of the family my goodness it's just a tremendous group of people their handshake their word is their bond
And guys, they're a great community servants.
They've won many awards for giving back to the community that Food Pantry is a magnificent contribution to the community, plus all of what they've done to help our veterans.
You will see proudly flying at their headquarters, old glory, and our liberties reprise and our rights, we will maintain Iowa flag as well as our MIA POW flag honoring our veterans as Kurt and Urma serve so valiantly.
during that World War II era.
Clint, I've always said your family is great because there's no higher business vocation than providing a safe, beautiful, affordable home for a family.
You guys have been doing it now for three generations, well over 50 years.
Yes, sir.
We plan to keep it going.
That's awesome.
Well, Clint's a young man, so guys, he's going to be there for a while.
He's eager to see you.
Stop by or call or get on that email or get on that website.
Hames Homes, the Homes people.
We're honored today to be talking to Clint Hames.
Clint, you're in the rotation.
We'll speak to you again when it's not Barbara Curd.
You'll be up next.
It's around Robin with you, good people.
Very good.
Well, I'll be looking forward to talking to you.
All right, guys, Clint Haymes and we'll be back in just a moment.
Economics is the study of human choice in the world we live.
Faith is confidence in what we hope for and assurance about what we do not see.
By investigating faith in economics, we can learn how they lead to human flourishing.
This is the Faith in Economics podcast, a presentation of the Gortney Institute at Ottawa University.
Welcome to our show today.
My name is Peter Jacobson.
I'm the Gortney Professor of Economic Education and Research here.
Joining us, we have Dr. Justin Clark, the Menard Family Professor of Philosophy and Ethics.
And also, in showing our show, we have Dr. Russ McCullough, the founder of the Gortney Institute and the Wayne Angel Chair of Economics here at Ottawa University.
All right.
Well, how many of you listeners were held up at the airport with the latest government shutdown?
There's a lot of grief and anguish and money lost in a variety of ways during the government shutdown.
So it's just, to me, it was just a classic case of government failure on how big of an impact that could ultimately have for all the reasons it did.
It really all points to them not being able to pass something through.
legislation and the bad news is we've got another one coming up I believe it's end of January sometimes so so I felt compelled to send a letter an op-ed piece to the Wall Street Journal I don't know if it's going to be published or not I guess we'll find out by this but I'll try to get it out to some other outlets and I thought it'd be fun to talk about it today
Being an economist, I'm always thinking, oh gosh, there's losses on both sides.
Nobody's happy between consumers, people who are the air travelers and then the people working for the air traffic control and the TSA, and then of course the airlines themselves that had to change things around.
So wouldn't there be a way to make things better?
Wouldn't there be some way to have people come together on this?
So here's the idea that popped in my head.
Why wouldn't the airlines be able to create a fund together that would loan money short term, very short term to the workers who were required to show up to work but weren't going to get paid until the government opened up again?
So we have this
There was different categories of people.
So I'm specifically talking about like the air traffic controllers and TSA agents where they were for sure going to get paid.
They just have a deferment and you hear about, oh, when this was being talked about on the media that people do go to their banks and, you know, get short-term loans, but not everybody's in the same position to have that lending facility there or
put it on a credit card or whatever, you know, go to other sources.
So why not have a unified place where people could go for a loan?
And so the millions of dollars that were lost by the airline industries, I thought, well, shoot, they could probably give them an interest-free loan and still be ahead.
Well, to my surprise, it was even more ahead than I thought it was going to be.
After starting to do the work, I learned Delta Airlines reported losing $200 million.
And so I started thinking, well, jeez, if that was $200 million, I wonder how much it would actually be to cover paychecks.
I went and looked at how many people were out of employment, and so I found an article.
This is all just simple Google searches, to be honest.
I didn't go through and vet them super carefully, which I'll just leave it to the people if they want to advance this further to do.
But there were 60,000 people.
Average paycheck from the government, which again might be, I'm thinking a little high, but $4,700 every two weeks, was the just blanket average of government employees, which like I said, that might be higher than the 60,000.
people were talking about.
So if the Delta and other major airlines and other airlines were able to pony up some dough to use for payday loans, essentially, where they would be paid back as soon as the government opened up, this was the longest shutdown in history, 43 days.
So we have, if they would pony up three pay periods worth of money, that ends up being about 15,000 per
employee, 15,000 times 60,000, gets us to this 114 million, I'm sorry, yes, 114 million is 820 million total to cover all of the paychecks.
I'll come back to the 114,000, sorry, I probably should have my article open.
So that would be an 820 million dollars to cover three weeks worth of paychecks for all these 60,000 people.
So then, you know, how would it be allocated?
I thought you need to come up with some sort of simple rule to know how much each airline should pony up for this.
And so what I did is I looked at the average number of flights in a month.
And so they're currently, the FAA reported 43,000 per day.
And so I extrapolated that out to a month.
And I think we were in the million, over a million flights in a given month.
And Delta is 180,000 of those flights on average.
And so the other major airlines were very similar to that, American Airlines Southwest.
So 180,000 Delta flights means that they represent 13.5% of the total flights going out in an average month.
And so they would pony up 13.5% of the 820 million, which is the 114 million I accidentally blurted out earlier.
So already them putting 114 up is less than the 200 million that they lost.
So keep that in mind.
So now there's a opportunity cost of their money.
So I just again somewhat arbitrarily said 6%.
And so lost interest would end up being about $800,000 if you take six weeks worth of lost interest at 6% on Delta's 114 million.
talking eight hundred thousand dollars and so if everything went smoothly where they made a payday loan the people paid it back when the paycheck came in because they're gonna get exactly the paycheck is their amount of the loan and then that exact amount comes in their paycheck once the government opens up then that loan is immediately paid back and all of the airlines are made whole
From the funds that were in the account they get their 13 and a half percent back of whatever funds remain in the account And so that is if it ended up being eight hundred thousand dollars of opportunity costs.
It's losing eight hundred thousand versus the reported losses of two hundred million kind of a no-brainer and plenty of room for wiggling on Russ's back of the envelope numbers conceptually I
I think this could work, and I don't even think all airlines would have to necessarily participate to make it work.
There's many ways that this, I think, come together.
Again, if people defaulted on the loan, didn't pay back their loan right away, the normal recourse would be there for collections and other things.
But I think this really has some potential
to make everyone's life a lot easier so you add up delta saving 200 million and the other airlines being maybe somewhere around there you're probably approaching a billion dollars pretty quickly and so i called this the billion dollar deal uh billion dollar idea
because then you quickly get over a billion when you add in the air travelers cost of extra restaurant meals, delays, canceled trips, canceled business deals, all of the pain and anguish.
If you put the non-monetary suffering and estimate it, I think we're easily over a billion.
So let me pause there.
That's conceptually what I was thinking.
And I love the idea in that it doesn't require government bureaucrats or politicians to
sanction it or to bless it?
At least I don't think so.
Maybe there is some legal thing since their paychecks are coming from the government that there'd have to be something.
So that would have to be explored.
But it's basically a private solution to this problem.
Yeah, I think your last point there is where I want to hit.
So first off, I do believe that it's possible that there are solutions like Russ's on the table.
And this actually might be one of them.
I think the first step is thinking,
why might not this already happen?
Now, for the record, some economists would say...
in the extreme that this won't work and the reason it won't work is because it hasn't been done already,
And people did that to Julian Simon when he proposed the reverse auction system for airlines.
So I don't think that that's a good route to go as an absolute, but I do think that there's value in asking the question, well, why hasn't this been done?
And so we, to answer that question, you either need to, you can need to locate one of two things.
You need to locate either like a switching or information costs that makes this very difficult for someone to come up with or to implement or something.
So that's possible.
And if that's true, then like, if it's an information cost, then Russ's article actually fixes that.
And so you like, maybe it becomes viable now.
But then another question is, is there somebody who actually benefits from this?
In other words, is there a vested interest in the way that the government shutdown does this or results in this?
And so a really easy and I think wrong story.
Oh, Justin, you got something.
Are you saying is there someone who benefits from
Shutdowns when they occur or is there somebody that would benefit from Russ's proposal?
No, I'm saying is there somebody who would benefit from a shutdown impacting air traffic control, right?
Okay.
In other words, is it is it good for someone that the air traffic controllers cannot fulfill their job or aren't paid or whatever?
Because if it is, then maybe that's why a Russ's solution does seem like it seems like a Pareto improvement, which is Russ's really good point is that like it's a win-win-win.
Everybody wins.
The airline loses less money, so they win.
Their traffic controllers continue to get paid.
They win.
The government doesn't have to be responsible for flights getting delayed, so they win.
it is a no-loser situation.
That's kind of the interesting part about the proposal.
In economics, it's rare to have no-loser proposals in a functioning economy, but it does happen, and I agree with what it does happen.
But it usually happens because of government.
Yes, yeah.
It caused it.
So then the question is, well, actually, is there somebody who would lose from this solution?
In other words, another way of saying that is, is there somebody who gains from the air traffic controllers being out of work?
I can think of one group maybe that that's the case of.
So the first question is,
Does the executive branch lose by Russ's proposal here?
And here's maybe why they would.
And I'm not saying for sure.
And I think they could argue other groups too.
But in my frame, the way I approach the government shutdown thing is government shutdowns are a cost imposed mostly on the executive branch, I think.
Because the legislative branch, I don't know if they directly benefit, but they don't seem too concerned about getting through it.
They actually get vacation time.
It doesn't seem to, it's a situation where no individual person loses credibility because Congress is already so unfavorable anyways that it doesn't seem to really affect their electability.
And everybody goes through it at once, so it's not like one cop.
So I think the legislature doesn't seem to care.
But the president does lose time, especially
when you have the situation we have right now, where Trump is the president of a party who has the majority in the legislature.
And so he's literally his days take away during shutdowns, his days to get things done and through the legislature.
And so it could be the case that the executive would want the FAA to have the air traffic controllers subject to the government shutdown.
So that way, when there's a shutdown, there is public pressure to end the shutdown.
That's possible.
And by the way, I'm not saying the president is smart enough to figure that out.
What I'm saying is an institution controlled by the president would evolve in that direction.
They would evolve in a way that there would be some sort of backstop to prevent shutdowns from carrying on forever.
And as far as I know, the FAA is under the president's discretion pretty significantly.
So that's a possibility.
I don't think that that debunks for us, because like I said,
before.
I don't think that we live in a world with zero $20 bills on the sidewalk.
I think there has to be profit opportunities out there.
But that's my best stab at like, who could be benefiting?
And by the way, even if that is true, that doesn't mean Russ's solution isn't good.
It still actually would be good for the public if this was adopted.
It just would be an explanation for like, what is standing in the way like, why haven't we done this yet?
It might be because the president doesn't want this to happen.
And I do agree with Russ that at the end of the day,
I bet there is some sort of like legal issue like that because these are government employees even though you would think that the government would love to accept this free essentially free money from the airlines.
pay their workers with this interest-free loan, essentially.
If it was interest-free, they would look really bad
from a public standpoint.
Well, unfortunately, you've got some stupid law standing
in the way.
Unfortunately, the government does that all the time, right?
Like, the government all the time will be like, oh, like, if I imagine, you know, just for a second that, like, I need to do something at 505 in my local municipal office.
And I say, hey, if you all stay an extra, you know, 10 minutes, I will pay you each $1,000.
The people would probably take that deal.
I would take that deal.
It would benefit the government on that because then in theory, like I'm compensating for like a significant amount of their wages, but we all know that the government would not allow that to happen, right?
Like that would go to some manager in some office who would say, we're legally not allowed to stay open 10 minutes for $1,000.
And maybe there's good reasons for that.
You could make arguments about white bread.
But the whole point being, I think Russ, your instinct is right that there's probably some legal challenge, but that could be overcome, right?
That's endogenous to your article.
Like you could maybe make a law that would fix that.
And then I think if
there is something like that, some sort of challenge.
I think the reason it exists is because the executive branch kind of evolves to this level of stopping the government shutdowns.
Well, this looks like a good spot for a break.
And Justin's got something to say.
I've got some something to say.
And I kind of lost a little bit of your argument that I'd like you to clean up with the benefits or harm to the president.
So there was something that was just a little came away a little bit unclear on.
So we'll pick up from there in just a bit.
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We have some great high school student programs like PPE Fest.
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Okay, so we're back.
Peter, you're bringing up some good points there on who benefits or who gets hurt, you know, from the shutdown outside of the airline that might perpetuate and not come to solutions.
Justin, what were you thinking?
Yeah, so I was thinking about Peter's point and I'm wondering if this is, I think it's the same point and you can tell me if I have your point right, which is that if
in government shutdowns, it's the executive branch that tends to pay the biggest political price.
They're usually the ones who are being blamed by the press and the legislative branch.
Even if the legislative branch was the one blamed, there's just too many people upon which that blame could lie to where the executive branch, it's like, heavy lies the crown.
And so while Russ's proposal takes some of the sting out
a government shutdown.
From the executive branch's perspective, no, we want that pain spread around because we want other people to feel this pain too.
Otherwise, there's less of an incentive for these government shutdowns to end.
And so on the margin, if we have a pain-free way to keep people getting paid during government shutdowns, that would actually lead
on the margin to more government shutdowns because the amount of pain suffered by Joe Sixpack goes way down.
Yeah.
Yeah.
And I perfect characterization.
And I agree with the characterization.
Now, that doesn't actually mean that that's what's happening here.
Yeah.
But it means that that would be a reason why the executive branch wouldn't like this, right?
They do want people to be in pain during the shutdown because if the pain is lower, the length of shutdown on the margin increases exactly as you put it.
Great, great
point.
And so, you know, I think that would be great actually.
I think there would be some benefit of longer shutdowns showing that, hey, we don't, what do we need these guys for anyway?
We should really limit government a lot more because we're actually playing doing pretty good.
So short of these, you know, airline type situations, if we had private that, cause this is what I believe would happen with shutdowns.
I think I maybe mentioned this on another podcast.
I talked to it about with, with my students about it.
is that you'd be surprised what's going to emerge spontaneously or emerging solutions when the government leaves the void.
Right, so so much of our stuff is crowded out, whether it's private charities being crowded out.
I think that was another example where I really didn't believe for a second that people were gonna starve very much.
They might go a little bit hungry with the SNAP program drying up.
I know Americans will step up non-profits and otherwise, and they did.
Here locally, our churches, we all, you know, bumped up food donations.
And so I think it would be awesome to see the government actually, if they were out for longer, all the ways that we would find private solutions, and this airline thing being just one of them, private solutions where the government currently is just in the way and they're there and it's always been done that way and blah, blah, blah.
I think we'd see a lot of solutions emerge.
And so I find that kind of exciting.
That's a little bit off topic of where we're going, because I did wanna add the Democrats, I think, called
a few of their constituents turncoats when they said, nope, the pain is too high.
This is, I don't want to be a part of this.
And so that's what allowed the government to open up when, I can't remember, was there four Democrats or so that changed their vote to allow it to open through majority.
And you know, Justin, you look like you're
thinking.
Yeah, I didn't like Federman take a lot of heat for taking this line.
Yeah.
And so, but, and the point is, is that they
that pain of the shutdown caused them to flip.
And so then we're back to what we're talking about, that if the pain was taken away, then the shutdown would last longer.
What I'm stepping in and saying is I'm saying go for it.
Let's have longer shutdowns.
If we find private solutions like this to fill the void, we might actually get a limited government someday.
This might be a mechanism to get a more limited government in our lives.
And I know not everybody feels that way.
Maybe I think the two on this podcast might, but I think that would be an interesting mechanism.
All right.
Well, any other last words?
Otherwise, this looks like a decent spot to rap.
Yeah, let's call it.
All right.
Well, this has been a production of the Gorton Institute here at Ottawa University.
I'd like to thank you all for listening.
Five Star Rating helps other people find us.
So, otherwise, just pass this along to friends and family that might like to take a listen.
Other than that, be fruitful multiply.
you
Thanks again, guys.
Tell your friends about the podcast, kxel.com slash Jacobson, J-A-C-O-B-S-E-N.
In the meantime, listen to all the wisdom of Jeff Stein during his weekday news and commentary, and folks, always remember and never forget to be safe, be smart, be good, be strong, love Jesus Christ, and God blesses everyone.
Until we meet again, have a great weekend and bye-bye!
