Free to Choose by Milton Friedman: Episode “Created Equal” (Part 7 of transcript and video)

Liberals like President Obama want to shoot for an equality of outcome. That system does not work. In fact, our free society allows for the closest gap between the wealthy and the poor. Unlike other countries where free enterprise and other freedoms are not present.  This is a seven part series.

Created Equal [7/7]. Milton Friedman’s Free to Choose (1980)


PIVEN: __ because of the free enterprise system.

FRIEDMAN: Excuse me. You’ve got to compare __


FRIEDMAN: __ you’ve got to compare something with something. Will you tell me the alternative which has improved the lot of the ordinary people? What is the system which in your mind has been successful? Most people through most history have lived in tyranny and misery. It’s only a very tiny minority, at any time, that have been able to escape from it. That’s the real beauty. That’s the real achievement. Now will you tell me what the alternative system is which has achieved __

PIVEN: You say that’s an achievement, though, of the free enterprise system and I say that __

FRIEDMAN: Excuse me.

PIVEN: __ elsewhere in the world__

SOWELL: What is the alternative?

FRIEDMAN: What’s the alternative? What’s the alternative? What’s your alternative?

PIVEN: The free enterprise system is of itself not an alternative because as you agree it does not exist. We are arguing really to defend those interventions which have been made by government on the behalf of people in an effort to reduce inequality in an effort to reduce oppression.

FRIEDMAN: And tell me which of those __

PIVEN: We are arguing to defend __

FRIEDMAN: __ which of those are you defending in which of these countries where those interventions have benefited the masses. In most of the countries where you have departed from the free enterprise system. You have had a small class benefited at the expense of the masses. If you take the African countries, which have become one-party dictatorships, are you going to tell me they have benefited the masses?

SOWELL: I’m astounded by the examples of the third world that are brought into here. Those parts of the noncapitalist world in which the capitalist system has penetrated are typically higher income places than those parts where they haven’t. Are you talking any kind of testable hypothesis or it’s just axiomatic that it’s so. Because the studies that I’ve seen indicate that those countries where capitalists have never gone near them are poorer than they’ve ever been. They were poor before the capitalists got there; they were poor while the capitalists were there and they are poor after capitalists have left.

PIVEN: Your measures of wealth are not measures __

SOWELL: I haven’t __

PIVEN: __ of the wealth of a people. They are measures, rather, of gross national product __

SOWELL: Give me your measures then.

PIVEN: __ which reflect, as in the case of Chile which you don’t want to discuss, which reflect the great advances that have been made by the middle classes and the upper classes in Chile as of this date, at the expense of the sharp decline in the income of working people. The catholic church __

FRIEDMAN: Those are not the facts.

JAY: But I still think Milton has not told us the answer to the question, “what is he saying?” And it’s very important we should know what he’s saying. It seems to that he should accept the fact that nobody is arguing for absolute equality and disregarding all other social and human objectives. He should accept that it is perfectly reasonable, widely endorsed and perfectly logical for people to say, amongst other social, political objectives reducing inequality is a perfectly sensible one and that in those cases where you can show that you can get a big gain in equality for only a very small loss in freedom or only a very small loss in efficiency. That is a sensible and legitimate thing to do and if it involves government actions by, for example, income tax or negative income tax that is a perfectly proper and sensible thing to do. And if he’s denying that then I still say he has given us no moral or ethical arguments to explain why he is denying that then I still say he has given us no moral or ethical arguments to explain why he is denying that perfectly proper concern with equality along with freedom, efficiency and other human objectives.

FRIEDMAN: The answer to that is that you can only serve one God. And that stating that there is __

JAY: You have lots of objectives in you life.

FRIEDMAN: __ excuse me. Stating that there are many, many of these objectives is evading the fundamental issue. In addition__

JAY: Common sense.

FRIEDMAN: __ as an empirical matter, the attempts to achieve equality along you line to lessen inequality have generally backfired. They have generally reduced freedom without in fact __

JAY: In Germany?


JAY: In Japan?


JAY: In France?

FRIEDMAN: Take the Japanese case which is a marvelous case, not now, but 1867 after the major restoration.

JAY: No right now, right now. Hell with 1867.

FRIEDMAN: Well, the reason for taking it then is because you had a far greater measure of free enterprise then than you have had more recently.

JAY: That’s my point.

FRIEDMAN: In almost all cases the way to promote equality is the same as the way to promote __ as an outcome __ is the same as the way to promote freedom. If you promote freedom, if you remove arbitrary obstacles, you open the way for people to use their resources. You will end up, in my opinion, and I think the empirical evidence is overwhelmingly on this side, you will end up with both more freedom, more prosperity and more equality.

JAY: You’re a closet egalitarian. You’re a closet egalitarian, really, then. You __

FRIEDMAN: I am not.

JAY: __ you support the objective the.

FRIEDMAN: I would like __ there’s an enormous difference between liking to see a result and being in favor of a particular method of achieving that result.

JAY: You’re willing to__

FRIEDMAN: Because if I were wrong, if freedom led to wider inequality, I would prefer that to a world in which I got artificial equality at the expense of freedom. My objective, my god, if you want, is freedom. The freedom of human beings and the individuals to pursue their own values. That will also generally be the result __

MCKENZIE: Well, there we leave this discussion at the University of Chicago. I hope you’ll join us for another edition of Free to Choose.

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