Economics

Remembering Milton Friedman

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Via economist extraordinaire Don Boudreaux comes a reminder that Milton Friedman died a year ago Sunday–and a clip of Friedman on the old Phil Donahue show wherein our hero defends "greed." Or more accurately, how free market systems harness self-interest in such a way as to benefit everyone, especially the poor.

reason had a long and warm relationship with Friedman, who contributed to our pages and, far more importantly, to the increase in freedom the world has seen since our first issue hit the stands in May 1968. Beyond any ideolgical issues, Friedman remained the paradigmatic public intellectual. As I wrote in our February 2006 2007 issue:

He provided an all-too-rare example of a public intellectual who was scrupulously honest, forthright, and fair in every debate he entered. As such, he provides a model that all of us might follow, whatever our ideology.

When I heard the news of Friedman's death in November, I thought of the haunting eulogy of the great Finnish runner Paavo Nurmi: "When nature removes a great man, we explore the horizons for a successor. But none comes and none will, for his class is extinguished with him."

I hope not.

Go here to read "Quotations from Chairman Milton," selections from his reason contributions.

And go here for more reason articles by and about Milton Friedman.

NEXT: From the DWI Files

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  1. I was fortunate enough to see him in Cabo a few months before he died. Yes, just see. I mean, what do you say to Milton Friedman? I felt intrusive enough just taking his picture.

  2. I can say that for me it didn’t all begin with Ayn Rand. It was Friedman along with Hayek.

  3. IF anyone wants to see something kind of interesting, heres Donald Rumsfeld (yes, that Don Rumsfeld) on “Free to Choose” circa 1980.

  4. TWC,

    I saw him speak at a conference in San Jose in the late 90s. He was about ten feet away. I didn’t get to meet him, but I did meet David, who was promoting a book at the conference.

  5. “As I wrote in our February 2006 issue:”

    Nick — Unless you’re psychic, I think you mean the February 2007 issue.

  6. The whole world is better off for the dissemination and adoption of Milton Friedman’s ideas. Milton is one of only a couple public figures whose death caused me to weep.

    Nice pics, Wine Commonsewer!

    Yeah Cesar, for me it was Freidman’s “Capitalism and Freedom”, Hayek’s “The Road to Serfdom”, and Rand’s anthology, “Capitalism the Unknown Idea”. Kinda all at once! And after that, many other wonderful volumes by all three of em.

  7. Hero worship muddles the mind.

  8. Nick — Unless you’re psychic,…

    Nick needs to be wearing his black leather jacket for his psychic powers to work.

  9. Hero worship muddles the mind.

    Is that what happened to you, Edward?

  10. http://www.zmag.org/content/showarticle.cfm?ItemID=11491

    Eye of the Hurricane: Milton Friedman and the Global South
    by Walden Bello
    November 27, 2006

    While economists laud the recently deceased Milton Friedman for being “a champion of freedom whose work transformed economics and changed the world,” as a full-page advertisement in the New York Times put it, people in the South will remember the University of Chicago professor as the eye of a human hurricane that cut a swath of destruction through their economies. For them, Friedman will long be associated with two things: free-market reform in Chile and “structural adjustment” in the developing world.

    Soon after the coup against the government of Salvador Allende on September 11, 1973, Chilean graduates of Friedman’s economics department, who were soon dubbed the “Chicago Boys,” took over the helm of the economy and launched a program of economic transformation with doctrinal vengeance. In light of his much-quoted assertion about political freedom going hand-in-hand with free markets, the irony that in Chile a free market paradise was being imposed with the bayonets of one of Latin America’s most bloodstained dictatorships could not have escaped the guru.

  11. Yeah, Cuba is such a hell hole now. I mean, its a democracy and has one of the best economies in the western hemisphere! It should be more like the workers paradises of Cuba and Venezuela.

  12. It should say:”Yeah, Chile is such a hell hole…” etc, not Cuba.

  13. Milton Friedman spent his career teaching in a private college that was supported by government grants to students.

    His tenure didn’t allow the free market to work. If some professor that was more talented wanted to work at the University of Chicago they couldn’t hire him. Friedman had tenure and couldn’t be fired. The tenure ensures that the free market will not work.

    His large professor’s pension wasn’t decided by the free market but rather through a union’s collective bargain agreement.

    He died in a hospital that received a large amount of government funding though medicare and medicaid. Many of the patients at the hospital had employer-provided health insurance that wasn’t included in the compensation of the employee, but rather was deductable to the employer, another government tax break to companies that provide health insurance. This tax break kept the free market from working. He would talk the free market, but he was a hypocrit.

    1. Edward, never a truer word was said. I am looking at this weblink trying to find out if I can get close enough to Friedman’s grave to piss on it.

  14. This quote by Milton given in the link should be told to anyone who says they like Ron Paul but won’t vote for him because they can’t stomach registering as a Republican (italic snark added by me):

    I have a party membership as a Republican, not because they have any principles, but because that’s the way I am the most useful and have most influence. My philosophy is clearly libertarian.

    As for me, it started with conversations with my libertarian brother, then Atlas Shrugged, with The Road to Serfdom as a much later dessert. Milton’s books were a bit of a disappointment by the time I got around to them, since they were admixed with some bad ideas. I mean, we can “thank” Milton for payroll deductions, which have immensely helped the growth of the welfare state.

    Like Milton’s anarcho-capitalist son, David Friedman, much more. His “The Machinery of Freedom” would be the first book I’d recommend to anyone starting down the road to freedom.

  15. Edward, can’t you do better than “libertarian reluctantly calls fire department”?

  16. Cesar,

    Won’t you admit that Libertopia has never been put to the test? You libertarians are people of faith, not reason. Hence the hero worship. Religious folks need their saints.

  17. “He provided an all-too-rare example of a public intellectual who was scrupulously honest, forthright, and fair in every debate he entered.”

    I hate to disagree seriously with Nick, but really Uncle Miltie does not deserve this kind of reverence. He was very right on the big things–the biggest being the vast superiority of markets to government planning–but, like so many economists, Friedman was an elitist, and not at all above trying to manipulate public opinion. He frequently, well, he frequently lied, when he felt it was necessary to induce the many-headed to do the right thing.

    In his early years he vigorously pushed the argument that free markets and free political institutions were necessarily linked–in large part to rebut the false charge from the left that capitalism and fascism were necessarily linked. But American slavery flourished under capitalism–the big slave owners were among the most efficient capitalists in the early U.S. And capitalism didn’t undermine slavery–an evangelical anti-slavery movement did that. Of course, the final victory was due to the vaster greater economic strength of the North, but much of that was simply a function of the North’s much larger population.

    There are many other historical examples, down to the present day. Prior to WWI, Germany enjoyed economic growth comparable to that of the U.S., without comparable political freedom. During the Great Depression, Nazi Germany and Imperial Japan outperformed the rest of the world. Today, authoritarian regimes like Russia and China are doing quite well. The triumph of democratic ideals requires capitalism, but capitalism in and of itself doesn’t generate democracy.

  18. Won’t you admit that Libertopia has never been put to the test? You libertarians are people of faith, not reason. Hence the hero worship. Religious folks need their saints.

    Oh, give me a break. Neither has Liberaltopia or Conservatopia.

  19. Pay him no attention. His presence here is worthless.

  20. Ah, I wondered how long it would take for someone to dredge up the “Milton Friedman was an advisor to Pinochet” slander. Edward at 12:55pm did not fail to disappoint.

  21. Alan Vanneman

    What’s somebody who can actually put two thoughts together doing here?

  22. Edward: Tenure at a private institution is a free market innovation. The university chooses to offer tenure as part of their compensation, and the professor chooses to work there based in part on that additional compensation.

    Collective bargaining is a free market innovation, with workers banding together to get a better deal from their employer than they think they can get on their own. The employees are free to choose whether to strike or not, and the employer is free to accept or reject the unions demands.

    Now, the government’s interference with these free market institutions are socialistic — things like forcing a union shop on workers on the losing end of a vote on whether to unionize — but I doubt that Milton Friedman would have defended any of those interferences.

    Kudos, though, for not being a troll on this one, despite the really clueless leftist POV exhibited.

  23. Friedman did advise Pinochet. Where’s the slander?

  24. Milton Friedman spent his career teaching in a private college that was supported by government grants to students.

    He drove on tax supported roads too.

  25. Alan, the ante-bellum south outside of the towns was not capitalist. It was feudal. And capitalism was undermining slavery, there were strong arguments in the early 1800s that free labor was more efficent and profitable than slave labor.

  26. Pro, very cool.

    Uncle Miltie was good about making himself available. He was obviously frail but the mind was still sharp.

    Rick, thanks. I got in trouble for taking those pictures. I guess his eyes were very fragile and his vision was deteriorating from cataracts or something that flash photography aggravated. The pro photographer was also taking flash photos but she didn’t get busted.

    And of course, I was a catchy that weekend. Every dang time I tried to sneak a photo that chick was jabbing a finger in my face and telling me to knock it off. She wasn’t happy with me in the least. Eventually she had enough Margaritas to forgive me. But if Mrs TWC hadn’t been there she might have pitched me over the cliff to crash onto the rocks 300 feet below.

  27. “While necessary for freedom, capitalism alone is not sufficient to guarantee freedom. It must be accompanied by a set of values and by political institutions favorable to freedom”-Milton Friedman

  28. Neither has Liberaltopia or Conservatopia

    The more a person uses intellectual shortcuts like the above or Randroid, Libertoid. etc, the more it becomes obvious that he has a turd for a brain.

  29. Edward

    Friedman did not advise Pinochet. He met him one time as a courtesy.

    He met leaders from many other countries as well.

    Milton Friedman was, however, one of Richard Nixon’s economic advisors. As near as anyone can tell Nixon ignored everything he said, instead chosing to follow the advice of the renowned economist John Connally.

  30. Epitaph for edward:
    “edward the socialist troll/scumbag/dick spent his life enjoying the fruits of capitalism and posting on privately run Web sites while denouncing capitalism and its defenders. He shopped at for-profit, mostly un-unionized stores and driving cars made by large multinational corporations. At his funeral (which nobody attended, natch) he was buried in a private lot. Dogs to this day continue to piss on his grave.”

  31. But American slavery flourished under capitalism–the big slave owners were among the most efficient capitalists in the early U.S. And capitalism didn’t undermine slavery–an evangelical anti-slavery movement did that.

    American slavery proves that democracy is not a sufficient condition to ensure individual rights. As for capitalism, the ‘free trade’ of labor in the north allowed it to become so much richer than the south, with its market distorting slavery policy. Hence, the north was able to win the war through superior economic resources.

    It’s really of a question of the long term. Market dynamics does not guarantee that there won’t be temporary condition of immorality in political economy, any more than it can guarantee that they won’t be price spikes (or collapses). Over the long long however, free markets tend to create better political systems than their opposite.

    Most left-leaning revolutions against ‘capitalist’ systems has been due to severe corruption, which naturally takes away the advantage of free-markets with its own brand of market distortion.

  32. Friedman did not advise Pinochet. He met him one time as a courtesy.

    And Naomi Klein based a book around that? Jesus Christ.

  33. Couple fo points:

    The University of Chicago had a relationship that long preceeded the coup with some university in Chile, with visiting professors and stff. Milton Firiedman and his associates had a preexisting interest in what hapenned in Chile. they didn’t get invovled as a result of the coup, but well before it.

    Second point: if Hitler asked you to advise him on how to deal with Jews, would you say “fuck you”? or would you try to influence him to not persecute them?

    Milton Firedman made it clear that whomever wanted his advice was welcome to it. While I am not a fan of his (I’m really pissed at him for desiging the automatic withholding of income taxes from payrolls), this is not an immoral position to take. If you truly believe that you have ideas that will help improve people’s lives, there is nothing wrong with sharing them. I am sure that Milton Friedman would argue that the Pinochet dictatorship was far less oppresive than it otherwise would have been without his advice. Incidentally, I believe Milton Friedman did not actually work with the Chilean government; rather some of his prominant students from Chile did.

  34. I really hate blogging on Internet Explorer with its lack of a spellchecker.

  35. Try this again, maybe get it right this time;

    But American slavery flourished under capitalism–the big slave owners were among the most efficient capitalists in the early U.S. And capitalism didn’t undermine slavery–an evangelical anti-slavery movement did that.

    “While necessary for freedom, capitalism alone is not sufficient to guarantee freedom. It must be accompanied by a set of values and by political institutions favorable to freedom”-Milton Friedman

  36. Tarran, use Firefox. Although it has a few shortcomings, it works pretty well and has a spell checker. Wait, you prolly already knew that.

  37. I’m really pissed at him for desiging the automatic withholding of income taxes from payrolls

    Ronnie Rayguns did that for us Californios.

  38. Cesar

    No matter how many times the old “Milton Friedman was an advisor to Pinochet” chestnut is debunked (and it has been over and over for the last thirty-some years) someone can be rellied upon to come along and claim it as truth.

  39. the big slave owners were among the most efficient capitalists in the early U.S.(Alan)

    Another silly assumption based on what? Cartoons from your junior high school texts? Slavery was the LEAST efficient institution in the Americas.

  40. Issac-

    I just find it hard to believe (though not at all surprised) that a person could make an entire book based around one meeting and use it to coin a new obnoxious meme (“disaster capitalism”). No one has been able to explain to me what exactly “disaster capitalism” is but its now brought up every time Friedman is mentioned.

  41. For the record, the United States was not the only, nor the biggest importer of African slaves. Slavery was an institution throughout the Americas, and as the new countries gained independence in the 19th Century, it was abolished in all of them, with or without “evangelicals”.

  42. Any system that forbids an entire class of people form private property or social mobility based on their birth is not capitalism, its feudalism. This describes the ante-bellum south.

  43. Tarran, use Firefox. Although it has a few shortcomings, it works pretty well and has a spell checker. Wait, you prolly already knew that.

    That’s precisely why I am bitching. I’ve been spoiled by using firefox and konqueror. Unfortunately, this POS computer at the university only has I.E. 6. >(

    Sigh… At least it’s better than a chisel and tablet.

  44. I wonder if you could just dl FF onto the computer you are using. If possible, that would be cool. Prolly not though.

    IE better than a chisel and a tablet? Maybe.

  45. IE better than a chisel and a tablet? Maybe.

    Agreed. At least the chisel/tablet combo doesn’t suddenly produce more smaller tablets if you navigate to the wrong page…

  46. “Milton Firedman made it clear that whomever wanted his advice was welcome to it. While I am not a fan of his (I’m really pissed at him for desiging the automatic withholding of income taxes from payrolls), this is not an immoral position to take. If you truly believe that you have ideas that will help improve people’s lives, there is nothing wrong with sharing them. I am sure that Milton Friedman would argue that the Pinochet dictatorship was far less oppresive than it otherwise would have been without his advice. Incidentally, I believe Milton Friedman did not actually work with the Chilean government; rather some of his prominant students from Chile did.”

    Yep. I think that’s why he allowed himself to be interviewed for that piece of socialist propaganda filmmaking known as The Corporation. His interview was then chopped up and sprinkled through the film, amid fuller excerpts of interviews of Naomi Klein, Noam Chomsky, and other statists. Unfortunately, that tactic has enabled dummkopfs to claim that that movie is “balanced,” because hey, it includes Milton Friedman!

  47. Friedman was responsible for Pinochet in much the same way John Maynard Keynes* was responsible for Hitler.

    *The Economic Consequences of the Peace

    ———–

    ” I’ve been spoiled by using firefox and konqueror. ”

    Konqueror seems pretty squirrely, to me.

  48. Edward’s great-grandfather wrote: Won’t you admit that flying machines have never been put to the test? You Wright brothers are people of faith, not reason.

    Darn right.

  49. So you libertarian keeners are the Wright brothers of utopian politics? You’re very modest, too.

  50. Sorry, Edward, I don’t speak idiot-ese. What’s a “keener”?

  51. keeners?

    As in, we think libertarianism is peachy keen?
    Or do you mean we’re really sharp?
    Do you mean we’re marvelous?
    Are you suggesting we’re wailing or lamenting something?
    Are we acutely sensitive?

    If you meant to be insulting, I think you failed.

  52. And if modesty is a virtue, Edward, you’re as lacking in that department as anyone here.

  53. “Over the long long (sic) however, free markets tend to create better political systems than their opposite.”

    Yeah? Provide a single shred of evidence for this central claim to the libertarian faith.

    Seems to me the short-term consequences could easily be massive death, destruction, and misery, while the long-term ones are some surviving billionaire gets an extra yacht.

    So we get to Friedman’s quote referenced on this thread about political institutions and policies favorable to liberty. Well whoop-de-damn-do. That’s all liberals are talking about. Nobody’s a commie in this country. We just think that the naked market tends to benefit the few at the expense of the many, and a responsible government has a responsibility to correct for this natural injustice every bit as much as it should correct for the fact that highways don’t occur naturally.

  54. So you libertarian keeners are the Wright brothers of utopian politics? You’re very modest, too.

    Edward, my point was simply that ideas aren’t to be discounted simply because they have not yet been proven. All innovation requires a level of faith, imagination and optimism.

    You know, I’d take you a lot more seriously if your arguments were only 95% scorn and at least 5% substantive. What is it that brings you back for a beating? If your political philosophy is really superior to the others’ on this site, share it instead of just tearign down theirs’. Communist, fascist, keynesian, we’d give you a lot more respect if you did just that.

  55. “Over the long long (sic) however, free markets tend to create better political systems than their opposite.”

    Yeah? Provide a single shred of evidence for this central claim to the libertarian faith.

    A compelling example is the tale of Germany. East and West parted ways for almost a half century, and when they reunited, the level of properity, creativity and stability in the two were remarkably different. The driving difference really seems to be a free market economy vs a socialist one. It’s an ideal test case because most other factors were the same: same culture, same time period, same global economic conditions, etc.

  56. I’m curious to know who all these libertarians promising a perfect world are.

    Libertarians are not the ones promising utopias without poverty, racism etc. It is the modern American Liberal who is the utopian and who is ultimately willing to use any means to that end. Likewise the modern American conservative promises a utopia of order and security.

    Libertarians promise nothing, except to leave you alone.

    It is an imperfect world. In the end it seems that libertarians are the only one’s who recognize this basic fact.

  57. Well, one of the advantages to a libertarian world view is that it is, essentially, one that prefers decentralized decision-making to the centralized variety. The evidence against the efficacy of the latter is overwhelming, though, of course, many people like to pretend otherwise.

    How anyone can deny that the human condition has improved mightily under freer markets and Western liberalism is beyond me.

  58. Pro Libertate

    While I believe that freemarkets and generally maximizing liberty leads to the best outcomes, I hardly consider those to be utopian ideas.

  59. Isaac,

    I’m talking best outcomes, too. All we can do is maximize human liberty and happiness as best we can. Trying to do that primarily through government action hasn’t worked and won’t work. Not until Jesus and/or enlightened robot overlords come down to provide us with perfect rule.

  60. “We just think that the naked market tends to benefit the few at the expense of the many, and a responsible government has a responsibility to correct for this natural injustice…”

    Government cannot “correct” for this. It can only apply its own additional injustices. You are hoping that adding a bridle will cure you of a saddle.

  61. Not until Jesus and/or enlightened robot overlords come down to provide us with perfect rule.

    Pro,

    Do you mean that Jesus won’t be an enlightened robot in his second coming?

  62. The more a person uses intellectual shortcuts like the above or Randroid, Libertoid. etc, the more it becomes obvious that he has a turd for a brain.

    Did you mean to say toid for a brain?

  63. Yeah, “toid” works if you’re from Joisey.

  64. “Nobody’s a commie in this country. We just think that the naked market tends to benefit the few at the expense of the many, and a responsible government has a responsibility to correct for this natural injustice every bit as much as it should correct for the fact that highways don’t occur naturally.”

    The alternative is that everybody suffers equally? Those people who are benefiting are the ones who are out there creating wealth. I’ll grant you that others had to pitch in and help – who also get rewarded for their participation.

    How many millionaires did Bill Gates and his cronies create?

    However, those same people who you hate for owning a yacht will not be motivated, as illustrated by socialism, if there is no financial reward.

    Your system works in an world of perfect people who are altruistic. The government you think is going to “correct” things are the worst mafiosos of all!

    And it’s nice of you to be so “fair” and “well intentioned” with others peoples money. So long as nobody has more than you … then it’s okay even if we’re all living in poverty?

  65. Lord Volton:

    So many fallacies so little time. Wealth is not just earned, it is also inherited and gained by the fleecing of others. The government has to pay for some things (if you don’t agree with that then you should probably just go off to your compound and wait around for the FBI). One of the government’s charges is to secure the general welfare. If a laissez-faire system leaves us with 10 gazillionaires and 300 million poor people, something is just wrong. There is no natural fairness in this. The gazlillionaires may possibly have been smart and innovative, but they certainly don’t work any harder than the serfs working for them.

    All liberals want is a tax code that pays for government while not placing the bulk of the burden on those who can least afford it. It’s a simple matter of arithmetic and ethics. Not being able to afford a second yacht is a form of suffering I suppose, but not being able to put food in your children’s mouths in order to subsidize that yacht is much more of a concern to me.

    I guess the fundamental philosophical difference is that whereas you assume wealth is the product of ingenuity, I see it as preexisting, and some get a larger chunk than others for various reasons, most of which have nothing to do with the great Randian human spirit.

    You’ve set up a straw man–again, I repeat, nobody is advocating communism. That is the leftist extreme that balances out the other extreme nowadays called libertarianism. Both are untenable. I’m for pragmatism and practicality to attempt to make the fairest system possible. If you want to live in a place where only natural laws apply, go back to prehistory and see how you like it. Because for now you happen to live in a country (I presume) that lists ensuring the right to the pursuit of happiness (for everyone) as one of its government’s primary functions.

  66. SD82:

    If a laissez-faire system leaves us with 10 gazillionaires and 300 million poor people, something is just wrong.

    It’s a good thing then that a laissez-faire system doesn’t do this, isn’t it?

    I guess the fundamental philosophical difference is that whereas you assume wealth is the product of ingenuity, I see it as preexisting, and some get a larger chunk than others for various reasons, most of which have nothing to do with the great Randian human spirit.

    This is the real problem with your thinking. Wealth doesn’t exist in nature. Every bit of it is made, even that which is made from natural products. Gold in the ground is just another rock. Oil in the ground is just so much more decomposed animal and plant matter. Wealth doesn’t exists until:

    1: Somebody figures out a way to use these things that benefits people in some way. The products have to be made to give people something they want.

    2: Somebody figures out a way to extract the natural products (simple for some, not so simple for others) and make them into their useful form.

    In both of these steps, compensation occurs to those that are involved. The compensation isn’t always what you or I might think is fair, but in a laissez-faire system, if people aren’t compensated at least as much as they feel their work is worth, they don’t work.

    I think the most important thing that people can and should understand about wealth is that it is not a physical item. It doesn’t really exist. It’s just a string of agreements. You agree that the work your gardener does is worth a certain amount; I agree to accept that exchange. If the agreements aren’t honored (because a large portion of the agreed-upon value is withdrawn by gunmen or taxmen or whomever) by everyone (or nearly so), the system starts to break down.

    Wealth is nothing more than a special case of free speech; this is what any trade in intangibles is. You pay your gardener 4 quatloos – I shouldn’t prohibit it (by taking my 1.3 quatloo share in tribute) any more than I should shoot or imprison you for saying that “Star Trek references are crap and Britney Spears is way way better.”

    Apologies for not including a link to “Britney Spears sex tape” – all Reasonoids should feel free to google it if they want.

  67. If a laissez-faire system leaves us with 10 gazillionaires and 300 million poor people, something is just wrong.

    Historically it has been governments that have done that, rather than laissez-faire systems.

    Not being able to afford a second yacht is a form of suffering I suppose, but not being able to put food in your children’s mouths in order to subsidize that yacht is much more of a concern to me.

    Not being able to afford a second yacht – or any number of other things – in order to subsidize the putting of food into the mouths of someone else and someone else’s children is much more of a concern to me. If people can’t afford to feed children, perhaps they shouldn’t have had them in the first place. And if they had not had them, then perhaps they could afford to feed themselves.

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