Russ Roberts Quotes

The Universe is full of dots. Connect the right ones and you can draw anything. The important question is not whether the dots you picked are really there, but why you chose to ignore all the others.

The first principle is that you must not fool yourself—and you are the easiest person to fool.

Adam Smith was not a big fan of the pursuit of fame and fortune. His view of what we truly want, of what really makes us happy, cuts to the core of things. It takes him only twelve words to get to the heart of the matter: Man naturally desires, not only to be loved, but to be lovely.

Love locally, trade globally.

What can be added to the happiness of the man who is in health, who is out of debt, and has a clear conscience?

You're pretty sassy this morning, son. Is it all about Reingold's rulings?" "That didn't suck, but I've got me a fascinating, beautiful woman I'm falling for. Falling hard." "Quick work." "In the blood. My mama and daddy barely did more than look at each other, and that was that. She's got me, Russ. Right here." He tapped a fist on his heart. "Surely it's not considerably lower where she's got you?" "There, too. But, Jesus, Russ, she does it for me. I just think about her, and... I swear I could look at her for hours. Days." Brooks let out a half-laugh, edged with a little surprise. "I'm done. I'm gone.

Life’s not a race. It’s a journey to savor and enjoy. Ambition—the relentless desire for more—can eat you up.

If you want to make the world a better place, work on being trustworthy, and honor those who are trustworthy. Be a good friend and surround yourself with worthy friends. Don’t gossip. Resist the joke that might hurt someone’s feelings even when it’s clever. And try not to laugh when your friend tells you that clever joke at someone’s expense. Being good is not just good for you and those around you, but because it helps others be good as well. Set a good example, and by your loveliness you will not only be loved, but you may influence the world.

When we honor bad people or avoid good people, we are playing a role in degrading the world around us. It’s a small role, almost negligible. But together, our combined actions are decisive. Each step we take away from loveliness is a step away from civilization. As more and more of us take those steps, our seemingly negligible actions are no longer negligible.

Emotional interaction is a duet in which we are constantly fine-tuning our volume to match that of our fellow.

We tried buying local once; it was called the Middle Ages.

Economics helps you understand that money isn’t the only thing that matters in life. Economics teaches you that making a choice means giving up something. And economics can help you appreciate complexity and how seemingly unrelated actions and people can become entangled.

Smith is showing us a better path to contentment than the one the world holds out to seduce us with. There is another way to be loved. Instead of pursuing attention via wealth or fame or power, pursue wisdom and goodness. There are two ways to be loved, to satisfy the desire we all have in us to be noticed and to be somebody. The first path is to be rich, famous, powerful. The second path is to be wise and virtuous.

A modern way to capture what Smith is talking about when he talks about being loved and being lovely is authenticity. We want to be real, and we want the people around us to be real in how they think about us. Respect or love or attention that is inaccurate because I don’t deserve it isn’t real. Someone who is thought to be lovely, but who knows he isn’t, is living a lie.

One important characteristic of civilization is trust. When you can trust the people you deal with—when you don’t have to fear that your trust will be exploited for someone else’s gain—life is lovelier and economic life is much easier. How does trust get created? By the myriad small interactions we have with each other when we honor our word and pass up the chance for opportunism.

As we get older, we understand that the pain we have endured, especially heartbreak, hasn’t just made us stronger. It has made everything we experience richer and fuller. As we get older, we come to prefer bittersweet chocolate to chocolate that is merely sweet.

Economics teaches you that making a choice means giving up something.

Rather than revving up our feelings of injustice, Smith is telling us a way to find serenity. Wag more, bark less.

The idea that other people care about themselves is generally a good thing to remember if you want them to do something for you in return.

We fool ourselves about our worldview, our ideology, our religion, the evidence of our senses, and the interpretation of the world that we use to construct our beliefs. All the evidence we notice and remember confirms our views. Everything else is ignored or forgotten—or, better, dismissed based on flaws in the analysis. A reader of mine, Sam Thomsen, said it very well: The Universe is full of dots. Connect the right ones and you can draw anything. The important question is not whether the dots you picked are really there, but why you chose to ignore all the others.

specialization is both the cause and the effect of prosperity, and it creates the modern economic life that allows us to move beyond subsistence. Small groups of people—no matter how talented, no matter how skilled or strong or smart—cannot be wealthy by modern standards over any sustained period of time.

People mistakenly assume that if I’m against government involvement in health care, I must favor an alternative where profits drive decisions and businesses take center stage. The opposite of government isn’t business. The opposite of government is voluntary. [Health Care Without (much) Government, medium.com]

Life is like a book that you are writing and reading at the same time. You might have a plan for how it turns out. But for it to be a great book, it needs to be savoured and chewed and digested along the way, like a book you read that changes your life. And you have to prepare for a plot twist and maybe two or three.

How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it. Forty-two words. A long sentence by modern standards. I had to read Smith’s opening sentence twice before I understood what he was saying: that even though people can be pretty selfish, they do care about other people’s happiness. Makes sense. I kept reading. I read the first page. Then the second page and the third. I closed the book. A second confession—I had no idea what Smith was talking about. The book appeared to begin in midstream. Unlike The Wealth of Nations, which is delightful and engaging prose from the get-go, The Theory of Moral Sentiments is very slow going.

And even though he’s the father of capitalism and wrote the most famous and maybe the best book ever on why some nations are rich and others are poor, Adam Smith in The Theory of Moral Sentiments wrote as eloquently as anyone ever has on the futility of pursuing money with the hope of finding happiness. How do you reconcile that with the fact that no one did more than Adam Smith to make capitalism and self-interest respectable? That is a puzzle I try to unravel toward the end of this book. Besides the emptiness of excessive materialism, Smith understood the potential we have for self-deception, the danger of unintended consequences, the seductive lure of fame and power, the limitations of human reason, and the unseen sources of what makes our lives both so complex and yet at times so orderly. The Theory of Moral Sentiments is a book of observations about what makes us tick. As a bonus, almost in passing, Smith tells us how to lead the good life in the fullest sense of that phrase.

Undeserved praise is a reprimand—a reminder of what I could be.

How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it.

Being trustworthy and honest and a reliable friend or parent or child doesn’t just lead to pleasant interactions with people around you. It doesn’t just lead to having a good reputation and being respected. Being trustworthy and honest maintains and helps to extend the culture of decency beyond your own reach. You are part of a system of norms and informal rules that is much bigger than yourself. When you behave with virtue you are helping to sustain that system. Every time someone hears you say “google” when you’re talking about searching for something on the Internet, you reinforce and spread the use of the word as something more than a brand name. Every time you reward someone’s trust or go the extra mile, you are encouraging others to do the same.

The rat race is run by rats. But sometimes the rat inside us takes charge, and we find ourselves running the maze, looking for a bigger piece of cheese.

At the very beginning of The Wealth of Nations, Smith explains the power of specialization in creating prosperity. Ideally, we specialize and get good at something, relying on the opportunity to get the rest of what we desire from others. But if we are all self-interested, why will my neighbor or a stranger help me out, providing the goods I cannot provide for myself? Smith’s answer is a simple one—my neighbor will help me if there’s something in it for my neighbor. Trading—offering something in return for my neighbor’s help—is how we sustain the power of specialization.

Smith in his book and with his life is telling us how to live. Seek wisdom and virtue. Behave as if an impartial spectator is watching you. Use the idea of an impartial spectator to step outside yourself and see yourself as others see you. Use that vision to know yourself. Avoid the seductions of money and fame, for they will never satisfy. How to be virtuous is not so obvious, and that comes next. But I want to close this chapter with Peter Buffett, the man who ended up selling his Berkshire Hathaway stock for $90,000 and giving up the $100 million he could have had in order to pursue a career as a musician. A few years ago, Peter Buffett reflected on his decision to sell his Berkshire Hathaway stock to pursue his dreams in his memoir, Life Is What You Make It. He claims to have no regrets. But could a life as a successful musician possibly be worth giving up $100 million? Wouldn’t $100 million be even more pleasant? Then you ask yourself—what could he have with the extra millions? A nicer car? He could have a Lamborghini Veneno Roadster that retails for about $4 million. Or he could settle for the lovely Ferrari Spider, at $300,000; he could have a couple of those. He could have a mansion you and I can only imagine, anywhere in the world. Like Onassis, he could own an island or two rather than enduring the indignity of visiting an island in the Mediterranean, say, and having to share it with others while staying at a nice hotel. Could those physical pleasures possibly be worth sacrificing the life in music that he dreamed of and ultimately achieved? I think Peter Buffett got a bargain. He gave up $100 million and got something—hard as it is to imagine—that was even more precious. A good life. I think Adam Smith would agree with me.

can be added to the happiness of the man who is in health, who is out of debt, and has a clear conscience?

In The Theory of Moral Sentiments, Smith recalls a story from Plutarch’s Lives that may shed light on my friend’s inability to quit his job. It’s the story of Pyrrhus, the king of Epirus, a region of Greece. Pyrrhus is planning an attack on Rome. His trusted adviser, Cineas—Smith him calls the king’s “favorite”—thinks it’s a bad idea. Cineas is an impressive guy, a brilliant wordsmith and negotiator whom the king often uses to represent himself. But even though he has the trust and ear of the king, it’s usually not a great idea to tell the king he’s making a mistake, even when you’re a favorite of his, so Cineas takes a roundabout approach. Here’s how Cineas begins in Plutarch’s version: “The Romans, sir, are reported to be great warriors and conquerors of many warlike nations; if God permits us to overcome them, how should we use our victory?” Well, says Pyrrhus, once we conquer Rome, we’ll be able to subdue all of Italy. And then what? asks Cineas. Sicily would be conquered next. And then what? asks Cineas. Libya and Carthage would be next to fall. And then what? asks Cineas. Then all of Greece, says the king. And what shall we do then? asks Cineas. Pyrrhus answers, smiling: “We will live at our ease, my dear friend, and drink all day, and divert ourselves with pleasant conversation.”   Then Cineas brings down the hammer on the king: “And what hinders Your Majesty from doing so now?” We have all the tools of contentment at hand already. You don’t have to conquer Italy to enjoy the fundamental pleasures of life. Stay human and subdue the rat within. Life’s not a race. It’s a journey to savor and enjoy. Ambition—the relentless desire for more—can eat you up.

Love is not a verb. It is simply any experience that produces an awareness of the ever-present radiance of the Divine. Any experience; a sunset, a puppy, or the embrace of a lover's arms.

The economist Russ Roberts has quoted the CEO of Flexport, a company that helped people getting access to facemasks.16 He was clear that one key reason for the shortage of masks was the fear of being accused of price gouging, saying “U.S. distributors can’t pass higher prices through to hospitals in the midst of the crisis, for fear of being accused of profiteering. Foreign governments and health care systems have been less encumbered by this, showing a willingness to pay more and pay faster to get first in line.

Russ Vaughn, a member of the fabled 101st Airborne Division who had served in Vietnam, published a widely circulated poem that told how the Swifties had won the “last battle of Vietnam.” The poem ended with “To our Brothers, forever, on that long black wall / You’ve been vindicated now, one and all.

Through most of human history, authority and tradition—the kings who ruled us, our parents, the religion we were born into, the culture surrounding us—tamed the wild problems we faced.

If the important things are hard to measure, and the measurable things misleading, what kind of decision framework is left? This book is my answer to that question.

difficult to get a man to understand something, when his salary depends upon his not understanding it.

Who with eyes open would willingly choose a path that promises the possibility of more suffering and heartache than joy and delight? Who volunteers for heartache and unease? Human beings. We like a challenge.

So convenient a thing it is to be a reasonable Creature, since it enables one to find or make a Reason for every thing one has a mind to do.

For Smith, prudence means, in modern terms, taking care of yourself, justice means not hurting others, and beneficence means being good to others. That’s not a bad trio for thinking about how to live the good life.

I always encourage the students to address their employer’s self-love and not just their humanity—to come up with some reason XYZ will benefit from hiring them. How would your skills serve the goals of XYZ? Do you have any idea what those goals are? The idea that other people care about themselves is generally a good thing to remember if you want them to do something for you in return. But

Hard-and-fast rules are easier to keep than rules that are slightly relaxed. The opposite

Smith in his book and with his life is telling us how to live. Seek wisdom and virtue. Behave as if an impartial spectator is watching you. Use the idea of an impartial spectator to step outside yourself and see yourself as others see you. Use that vision to know yourself. Avoid the seductions of money and fame, for they will never satisfy.

coming into the world, we soon find that wisdom and virtue are by no means the sole objects of respect; nor vice and folly, of contempt. We frequently see the respectful attentions of the world more strongly directed towards the rich and the great, than towards the wise and the virtuous.

For Smith, prudence covers everything in your personal bearing, the “wise and judicious care” of your health, your money, and your reputation. So the modern prudent man doesn’t smoke. He’s physically active and keeps his weight under control. He works hard and avoids debt. He stays away from get-rich-quick schemes. I would suggest that he prefers indexed mutual funds to managed funds and stock picking. In short, he foregoes the potential of a large upside to avoid the downside. But

one very useful thing I’ve learned from economics is to be skeptical of advice from stockbrokers about the latest stock that’s sure to skyrocket. Saving you from losses isn’t as exciting as promising you millions, but it’s still pretty valuable. But the real point is that economics is about something more important than money. Economics helps you understand that money isn’t the only thing that matters in life. Economics teaches you that making a choice means giving up something. And economics can help you appreciate complexity and how seemingly unrelated actions and people can become entangled. These insights and others are sprinkled throughout The Theory of Moral Sentiments. Money is nice, but knowing how to deal with it may be nicer. A student once told me that a professor of hers said that economics is the study of how to get the most out of life. That may strike some of you, even those of you who majored in economics, as an absurd claim. But life is all about choices. Getting the most out of life means choosing wisely and well. And making choices—being aware of how choosing one road means not taking another, being aware of how my choices interact with the choices of others—that’s the essence of economics. If

Despite opposition from Main Street and numerous politicians, policy makers put together the rescue in the name of avoiding a financial crisis. Ultimately, the US Treasury got its money back and even made a modest profit, causing some to deem the rescue a success. It was a success in fiscal terms. But it encouraged lenders to finance risky bets without fear of the consequences.

I have a friend with an incredibly demanding job that he doesn't particularly enjoy. But he puts up with it because he makes a lot of money, much more than he could make working for another company of doing something else. He has high blood pressure. His children get older every year. He complains about the stresses of his life and asks for my advice. Quit your job, I tell him. Earn less money. Spend more time with your wife and kids. Be happier. I can’t, he says. I have all these big deals in the works. Let me win those contracts, bag those bonuses. Next year I'll quit and slow down. But when next year comes along, he tells me about the new deals and the new bonuses. Next year is always a year away. Every year his salary grows. Every few years he moves into a bigger house and gets a new car. Is he happier? Evidently not. Despite the larger salary and the bigger house and the nicer car, he's not content. “Just one more year”, he says, “then I’ll have enough

Where we choose to live is about more than which place has better weather, better job opportunities, better options for day trips, better local food, and so on. Where we live is about who we are and not just what we experience.