Hitting the Root With the Axe

An Interview with Mr. Jeffersonian on the Great Reset and the Corporate Form

This week, I had the privilege of conducting an interview with Mr. Jeffersonian, which marks a new milestone for my Austro-Jeffersonian Empire of Liberty Podcast. It's also a return of sorts, as he was featured in a print interview I conducted in January.

In response to his podcast episode, The Great Reset, I wanted to dig into the underpinnings behind his perspective, which parts ways with the analyses offered by Robert Murphy and Michael Rectenwald.

We covered our common concerns with the growth of the corporate buyouts of residential homes (and neighborhoods) as defined by the Rentership Society, as well as the 21st century relationship with the corporate world in general.

My own recent piece, The Great Feudal Reset, addresses this particular concern, though we also covered the fundamentals behind the corporate structure, and how it deviates from the dealings of natural persons.

In transcribed form, I wanted to highlight some key takeaways from our exchange.

My own questions and points are formatted in bold.

MR. MENGER: In leading libertarian analyses on the Great Reset, such as those put forth by Robert Murphy and Michael Rectenwald, there's there's a lot of focus on what the government is going to end up doing. But also, what large multi-national corporate entities have in mind. And, of course, that means they could cross borders and exercise the kind of power that governments alone don’t have. So in this analysis, these entities make nice with a lot of governments out there and we can see cronyism at work, I agree with a lot of that. But in your take, the corporations are very central.

MR. JEFFERSONIAN: So I've heard a lot of libertarians, they really think that it's gonna be primarily driven by the government, in some cases, maybe exclusively by the government. That's not really the way that I approach it.

The government will have some role to play. I'm not going to sit here and pretend that it won't. As I mentioned in my episode, I think that's mostly going to come from trying either to collapse the currency or to transition us to a digital currency that they control.

Now, where I think the big split is is as far as the executive portion of this so actually carry it out in what's going to impact us day to day more than anything else. Obviously, the money is gonna be a big factor if we end up getting to that point.

But on a day to day basis, The government I think they're smart enough to say, “Hey, you know, why should we fight for all this stuff? why should we try to force people to do a lot of this when we can let the corporations do it, and people will do it voluntarily.”

MR. MENGER: You spent a considerable amount of time on so-called “smart cars,” especially on features that may seem kind of neat upfront, like an Apple player and heated seats. And I've also noticed the OnStar service has something like that too as an add-on in a lot of newer vehicles. And when so many of these “features” are already produced and assembled, but sit idle in the subscription model, it's actually kind of a bug.

Now, you express grave concerns in your Great Reset episode that sound rather drastic in the present tense. As I understand, this could include more basic elements of operating a car, even as basic as turning it on may be subject to such a subscription, if not, a botched update at a bad time. Do you feel that is a realistic concern?

MR. JEFFERSONIAN: I do, because they always start with small things, right? We have this situation where things go slowly at first and then - bam - it happens all at once. So I really do think we could see a day where to even start the car gets put on a subscription, versus right now.

You know, you make your payments to the bank and if you go welsh on your loan payments or your repayments, then yes, the bank head has every right to come and seize their property because they're technically the title holder. But with with the car industry kind of going the way that it looks like it might be trying to go - five, ten years from now - right now, it's going to be mostly first-world problems.

Because a lot of people may listen to this and they're like, “Oh, this guy's a kook.” Like, “Oh… he's worried because they want to charge for heated seats.” But no, seriously, let's stop and think five to ten years from now.

If they end up putting the starter on a subscription or you must get mandatory updates to keep the car operational. And guess what? You have to pay for those updates. Then who owns that car? Do you own the car or are you just receiving a license to use it? We already see that with computer software. You don't.

I have a Mac, right? We're recording this. I'm speaking into a microphone that's connected to a Mac computer. I don't own the software on this computer. I own the physical machine, but I do not own the software. Same thing if you're using a PC, you only license the software. You don't own it. So that may be fine and dandy when you're talking about, you know, maybe a $1,000 computer or $500 computer, whatever the case may be. But when we're talking about a Tesla five years from now, that's $120,000. That's a completely different story.

And then, you know, God forbid, but if we get to that point, and you have software updates, let's say if a software update breaks that car, right, because that happens with our personal handheld devices. That happens. Sometimes you may have a glitchy internet connection, maybe the update doesn't install correctly. And you have a device that ends up getting bricked you cannot use it. You got to update it. Okay, again when you're talking $500 to $1,000 Yes, that stains, but it's really not that big of a deal in the grand scheme of things. But when it's a 60,000 or $100,000 car, are people expected just to be permanent lessees?

MR. MENGER: I also want to get into the housing issue, that's also really piqued my interest. Because if we're looking to gain value down the road as homeowners, we should really start speaking out and sounding the alarm about companies like Invitation Homes coming to our block and saying, “Here's a nice teaser rate off the top, but this lease comes with all kinds of fees.”

It doesn't seem very promising to me. It doesn't seem like the trade off we actually had in mind we were looking for homes and dreaming about what it's like to put it together to express our individuality.

MR. JEFFERSONIAN: So, the issue with that is when when you're dealing with a personal landlord, right, or an individual landlord, there are certain constraints that they are subject to. They can only ever get so big is as far as number of properties they can own. I've known some individual landlords, they may own like 30 or 40 properties.

In some cases, if you ever listened to the Bigger Pockets podcast, those some of those guys own like over 100 properties, but they're still subject to certain limitations, right? They have a vested interest in maintaining that property because if the market ever tanks or if they ever want to get out, they want to try and sell it and get top dollar.

Realistically, they can’t just sit there and hold it forever - which a corporation can - because the corporate entity itself, whenever it's chartered, it gets a you know, an indefinite lifespan or immortality. So, when you have individual landlords, when they pass away, their kids, you know, they will probably split that property up in some way. So you're going to have a division of property there kind of a realignment of wealth, that's an organic realignment, so I don't really have a problem with that. It's not like the government is going in there and doing it, but then so on and so forth.

You know, as those kids inherit these properties, then who knows two or three generations from now, they may not want the headache anymore. No, let them go to somebody else. That's a perfectly healthy and natural feature of a real market-based economy.

But what's going on now, as you mentioned, with companies like Invitation Homes, they're coming in and they're buying these properties, in some cases for as much as 20, maybe even 30 percent above the asking price. Especially as it pertains to young people, you cannot compete with that. Not in our modern debt-based economy… This is the most heavily indebted generation in American history. And I mean, it's really not even close. They're coming out with thousands upon thousands of dollars in student loan debt.

MR. MENGER: With home values, it makes it all the more alluring for a man in a nice suit showing up at your doorstep to say, “Mr. Jeffersonian, I have a check for half a million dollars. All you have to do is sign the dotted line and be our tenant.”

Who in the United States is really prepared for that moment?

MR. JEFFERSONIAN: Very few.

And with Invitation Homes and companies of that ilk, what they do is they buy these properties with the intent to hold them forever. And that's, in my opinion, is really where the big problem comes in. Again, as we were talking about with individuals, at some point, they're going to let that property go whether they do it whether their posterity does it at some point, that property will be kind of realigned and redisperse organically.

When you have these big vacuums like corporations, you know, acting as a vortex for all this property. They don't have an incentive to let it go. They have an incentive to use it as a cashflow cow. And then that kind of ties in with what you were saying at the start of the episode in terms of all the fees and everything else that they charge.

One of the worst fees in my opinion that I've come across with these types of corporations is what's called a conveyance fee. That that's where the corporation will put the utilities in the corporate name. They won't let the tenant do that. They won't let the tenant be a responsible adult and go set up the electricity and water in their own name. No, they put it in the corporate name, and then they charge the renter or the tenant a fee to forward that bill. And that beacon rate range anywhere from $10 up to about $20 per month. And again, that's every single month, plus whatever you're paying in your base rate, which has already been inflated by their interest. So it's a nasty system.

Mr. Jeffersonian hosts The Jeffersonian Tradition podcast. He also writes on Substack.

External Resources:

• Best Buy's Geek Squad searched customer computers for the FBI, report claims by CBS News

• Lampert's Sears Takeover Effort Runs Into Pension Insurer Objection by Rich Duprey

• What Is the Great Reset? by Michael Rectenwald

• Behind Klaus Schwab, the World Economic Forum, and the Great Reset: Part 1 by Bob Murphy

See Also:

The Anti-Tax and Your Milkshake

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