“Friedman Friday” (“Free to Choose” episode 1 – Power of the Market. part 7 of 7)


Michael Harrington:  If you don’t have the expertise, the knowledge technology today, you’re out of the debate. And I think that we have to democratize information and government as well as the economy and society.

FRIEDMAN: I am sorry to say Michael Harrington’s solution is not a solution to it. He wants minority rule, I don’t. I want individual rule. I want human beings separately and individually to have control of their lives. I don’t believe that a minority that differs with me should have the right to take money out of my pocket to do research for them. They should go out and try to persuade people to contribute to them. I should be free to get people to contribute to me to present my ideas. But the idea of having some kind of an official government agency that is going to finance dissidents. In the first place, anybody who has any sense of realism about the way government operates at all will know that will end up in the hands of the majority and not the minority.

HARRINGTON: But can government in this extremely interdependent, complex world economy which is developing, can you have a mystical belief in the invisible hand of Adam Smith? I happen to think that Adam Smith was one of the greatest intellectual figures in the history of the world, and that capitalism was one of the greatest advances that humankind has ever made. But precisely because I put this in historical context; capitalism, as a friend of mine by the name of Karl Marx predicted some time ago, has developed tremendous tendencies towards monopoly, concentration, multinational corporations, money supplies that are not controlled by the Federal Reserve Bank or even the President of the United States anymore, and to think that you can respond to this radically new environment by an 18th century solution, I think really comes down to an intellectual exercise whose practical, political effect is to rationalize conservative power in America.

FRIEDMAN: This is a myth, a complete myth, that the development of an inner-developed country in a more complicated world necessitates greater government intervention. Government intervention has not grown in those areas which arise out of the complexity and interdependence of the world. It’s grown where? In taking money from some people and giving it to others. (Several talking at once.)

CONABLE: All I have to say is that government, Dr. Friedman, has to live in the 20th century __

FRIEDMAN: Of course.

CONABLE: __ much less the 19th or the 18th.

FRIEDMAN: Of course, but again __

CONABLE: And we have to take society as it exists today __

FRIEDMAN: Of course we do.

CONABLE: __ and build on that.

HARRINGTON: To me, the decisive thing at issue here is an essentially mythic, nonhistorical presentation of an abstract solution, taken out of time, which does not look to the tremendous evolution of capitalist society, the tremendous interdependence of the world, the fact that we now have not only national economic planning, but at the Tokyo summit we have institutionalized international economic planning of the major industrial capitalist powers. And under those circumstances, granted the enormous achievement of Adam Smith, granted the enormous achievement of the capitalist society, under this radically changed historical situation to propose those classical solutions, I think is to propose something nonserious which, however, does function seriously to rationalize conservative corporate economic and political power.

FRIEDMAN: The great achievements of the 19th century came from __ by departing from the kind of system you now want to reimpose. You want to take us back to the 18th and 17th century when we had a corporate society. When we had government controlling things. The whole issue is not what somebody is proposing in the 20th, or the 19th and the 18th, the whole issue is what is the right thing to do? What is the best way in which we can widen our opportunities, preserve our freedom, maintain our prosperity, and it seems to me the kind of solutions you would propose involve more of the same, more of the measures that have failed over and over again to achieve the objectives.

McKENZIE: Well, we leave the debate there this week and we hope you’ll join us again for the next edition of Free To Choose.

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