Civil Warrior

Capitalism and Friedman

The renowned economist Milton Friedman, who turns 90 on July 31, once gave a talk at a Washington, D.C. conference sponsored by the Drug Policy Foundation. His title: "The Drug War As a Socialist Enterprise."

To understand why that was a bold approach, you need to know a little bit about DPF (which has since been absorbed into the New York-based Drug Policy Alliance). Although DPF was officially open to critics of the war on drugs from across the political spectrum, the crowds at its conferences tilted decidedly to the left.

Friedman's audience could not be counted on to view "socialist" as an epithet. Indeed, the selection of a notorious arch-capitalist to receive DPF's highest honor–the Richard J. Dennis Drugpeace Award–had caused considerable consternation among the organization's supporters.

The honor probably was not as big a deal for Friedman, who had already received a Nobel Prize in economics and the Presidential Medal of Freedom. But given the context, no one would have faulted him for focusing on common ground. Instead, he took the opportunity to explain that the government's attempt to control drugs was a failure for the same reasons that its attempts to control mail delivery, education, health care, and housing had been failures.

Friedman said "the war on drugs and the harm which it does are simply manifestations of a much broader problem: the substitution of political mechanisms for market mechanisms in a wide variety of areas." He estimated that "the United States today is a little over fifty percent socialist," as measured by the resources the government commands through taxes and regulation.

Friedman emphasized that "the problem is not the kind of people who run our governmental institutions versus those who run our private institutions. The trouble, as the Marxists used to say, is in the system."

In particular, he explained, the ability to spend other people's money at will means that government programs do not face the discipline that private businesses do. "When a private enterprise fails, it is closed down," he noted. "When a government enterprise fails, it is expanded."

Friedman cautioned reformers against trying "to cure a problem created by socialism [with] some more socialism" by putting the government in charge of drug distribution. He urged them to "recognize that repealing drug prohibition is part of the broader problem of cutting down the scope and power of the government and restoring power to the people."

The DPF speech displayed several of the qualities that have made Friedman such an effective champion of liberty. For one thing, he is not shy of disagreement, even with people who share some of his views. He challenges leftish opponents of the war on drugs to rethink their opposition to school vouchers, and he challenges conservative supporters of vouchers to rethink their support for the war on drugs.

At the same time, Friedman strives to engage people on their own terms. He does not suffer fools gladly, but he sees his task as correcting their foolishness rather than silencing or humiliating them.

Friedman's civility is of a piece with his tolerance for diversity among his allies. Unlike other libertarian thinkers, he is not one to ostracize people over ideological differences, and he is quick to admit that his own views have evolved over time. He draws a distinction between ultimate goals and reforms that he thinks move in the right direction, while conceding that he might be wrong.

Friedman's pragmatism is reflected in his influence on Republican politicians. As an authority widely respected within the GOP, he has played a leading role in eliminating the draft, discrediting wage and price controls, and popularizing reforms, such as vouchers, a flat tax, and private retirement accounts, that shrink the realm of politics and broaden the domain of individual choice.

That theme is one that Friedman has returned to repeatedly in his books, essays, and speeches. As he explains in Capitalism and Freedom, the market "permits unanimity without conformity." It is "a system of effectively proportional representation" in which people who make different choices can coexist peacefully.

In politics, by contrast, the majority's decision is imposed on everyone. The further government goes beyond its central functions of enforcing contracts, settling disputes, punishing aggression, and protecting against foreign invaders, the greater the potential for conflict. By picking the right fights now, Friedman has tried to protect us from far more damaging battles down the road.