Reason.tv: Overstock.com's Patrick Byrne on Internet Sales Taxes, Naked Short-Selling, Regulatory Capture—and why he turned from a Yankee Republican into a fire-breathing libertarian champion of school choice.

June 25, 2009

Reason.tv's Nick Gillespie sat down recently with Patrick Byrne, the CEO of Overstock.com, the online retailer famous for sexy ads ("It's all about the O"), low, low prices, and hyperattentive customer service.

Born in 1962 and now living in Utah, Byrne holds a Ph.D. in philosophy from Stanford and serves as the co-chair (with Rose Friedman) of the Friedman Foundation for Educational Choice. He is the former manager of Blackhawk Investment, a cancer survivor, and a black belt in tae kwon do. 

An outspoken critic of online sales taxes, Byrne is a self-declared libertarian who champions short-selling while adamantly opposing the more-controversial practice of "naked" short-selling.

From his journalistic perch at the blog Deep Capture, he and his colleagues regularly chart the ways in which regulators routinely stifle innovation and maintain a status quo that favors connected firms at the cost of competitors and consumers alike.

Raised in New Hampshire, Byrne describes himself as a former "Yankee Republican" who has never felt comfortable with anti-market Democrats and no longer recognizes the GOP as the party of small government and individual liberty.

In this 10-minute interview, Byrne explains why school choice is the key issue of our day, how bad regulations contributed to the current economic crisis, and why "the government should pave the roads, run the Post Office, and stay off my porch."

Filmed by Dan Hayes and edited by Meredith Bragg.

Go here for embed code and downloadable versions.

Comments

Kyle Jordan|6.25.09 @ 12:06PM|#

I have to say it...

That chick from the commercials was SOOOOO fucking hot!

That is all.

For now...

DHS Thinks I\'m a Terrorist|6.25.09 @ 12:09PM|#

"Raised in New Hampshire, Byrne describes himself as a former "Yankee Republican" who has never felt comfortable with anti-market Democrats and no longer recognizes the GOP as the party of small government and individual liberty."

Change New Hampshire to Ohio and that pretty much describes me. To paraphrase Reagan "I didn't leave the Republican Party, the Republican Party left me."

Sean W. Malone|6.25.09 @ 12:32PM|#

My Governator ran away with your party DHS.

|6.25.09 @ 12:46PM|#

...Byrne holds a Ph.D. in philosophy...

...yet still went on to live a productive life.

|6.25.09 @ 12:47PM|#

Nice interview. I like finding out that cool companies are run by cool people.

The online sales tax thing does suck a lot. Anyone know the exact rules on that? Washington State sales tax is extremely high, and when I buy stuff online, I usually get hit with it, but not always.

|6.25.09 @ 3:07PM|#

Finally, Reason pays some attention to the biggest corruption story in the history of our financial markets. Combined with the coercive fraud that is central banking and fiat currency, one can see that our entire financial and banking system is corrupt to the core.

Shares are counterfeited by market makers, brokerages, and at its core, by the Depository Trust and Clearing Corporation (DTCC). The DTCC, a privately held monopoly that records all stock and bond transactions in the US financial markets, holds the ownership records for the entire US economy. Do you actually own the shares you bought? Maybe, maybe not. The DTCC's books have never been audited, by the way.

Money is counterfeited by the banking cartel known as the Federal Reserve system. The Fed, which is not a government agency, holds the entire gold reserve of the US government as collateral for the government's revolving line of credit. Payment on the ongoing deficit is ensured by the senior lien the Fed holds on everyone's income and profits, known as the Income Tax. Is there any value in the money you hold in your bank account? Maybe, maybe not. The Fed's books have never been audited, by the way.

The Fed's Class A shareholders (yes, it has shareholders) are the major Wall Street banking houses, e.g. JP Morgan Chase, Goldman Sachs, Citigroup, etc., that are the founding members of the cartel.

The DTCC's shareholders are the major Wall Street banking houses, e.g. JP Morgan Chase, Goldman Sachs, Citigroup, etc.

And it appears, given the actions of the current and past Administrations, these same institutions for all practical purposes own the Federal Government: They put their chosen men in as Secretary of the Treasury, they get whatever legislation they want passed (or blocked), and they get the public and the taxpayer to hand over trillions in bailouts to them.

Truly, we live in the largest banana republic cum welfare/warfare empire the world has ever known.

It will not stop until the people wake up from their stupor and "water the tree of liberty", as Jefferson put it a couple centuries ago.

Gene Berkman|6.25.09 @ 5:58PM|#

Good interview. I have bought from Overstock.com and consider Patrick Byrne an outstanding entrepreneur.

I have also read his commentaries on Naked Short Selling and he makes a good case that it is a problem in the securities market.

Overstock.com also has a section called Worldstock which sells hand-made goods from third world countries as a form of economic development aid - totally private, no tax money involved. The program has benefitted thousands of people in developing countries in a way that government projects never could.

johnl|6.25.09 @ 9:14PM|#

Byrne is a special pleader. He wants unbalanced regulation that puts more restrictions on short sales than margin buys. Tracy Coenen has the best Byrne smackdowns.

|6.25.09 @ 11:15PM|#

Johnl: You are a crook, who wants to stay in your crooked business of share counterfeiting. Go back to your internet stock bashing.

johnl|6.25.09 @ 11:29PM|#

It's a typical Byrne tactic to claim that anyone who disagrees with him is a crook. He's actually hired a fulltime team of three yesmen, Judd Baglley, Mark Mitchell, and Evren Karpak to make up bizarre stories about people critical of him. This is the behavior of someone with something to hide. And yes I would like to see restrictions on short selling that were symmetrical to those on margin buying partially because I like symmetry, partially because I think that would make the market more efficient, and partially because I believe I personally would benefit from those changes.

|6.25.09 @ 11:32PM|#

And you're a hired hitman for a naked shortseller. Crook.

johnl|6.26.09 @ 12:15AM|#

And you Maito are a yesman for a guy who uses PIPEs in the teens to fund buybacks in the 40s.

|6.26.09 @ 6:37AM|#

That's great…! It is really factual. But aside from that blistering news, let me share something. South Carolina's Governor Mark Sanford isn't winning himself any fans. Recently, Governor Mark Sanford was missing; neither his staff nor his family being aware of his location. His staff said he might have been hiking the Appalachian Trail, but it turned out that he was in Argentina - a continent away. The governor has been the subject of controversy, as he did all he could to resist the cash advance of the stimulus package allotment to South Carolina. His absence left some wondering if it meant the Lieutenant Governor was about to change job titles, but it's going to take more than a short term loan to rebuild the credibility of Governor Mark Sanford.

|6.26.09 @ 7:13AM|#

Seems to me that the issue with naked short selling is trivially solved by the exchanges, if they simply require a short seller to disclose whether he has already obtained the shares he's selling or not. That way, we could treat naked shorts like naked calls (which they are, effectively).

-jcr

|6.26.09 @ 8:55AM|#

You've got the market lingo down, dontcha, crook?