On my blog www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching for Milton Friedman also.
Milton Friedman videos and transcripts Part 3 On my blog http://www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching […]
Milton Friedman videos and transcripts Part 2 On my blog http://www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching […]
Milton Friedman videos and transcripts Part 1 On my blog http://www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching […]
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 [4/7]. Milton Friedman’s Free to Choose […]
Milton Friedman was right about Obama’s misguided view of stimulus many years ago Milton Friedman knew it a long time ago that President Obama was wrong when he blamed the ATM for unemployment. Take a look at this video clip below. He exposes the falacy that ignoring the principle of efficency will help create jobs. This […]
Here is the video clip and transcript of the film series FREE TO CHOOSE episode “What is wrong with our schools?” Part 1 of 6. Volume 6 – What’s Wrong with our Schools Transcript: Friedman: These youngsters are beginning another day at one of America’s public schools, Hyde Park High School in Boston. What happens when […]
Next year is the 100th anniversary of Milton Friedman’s birth and I get on the computer today and read an article published today on the National Review Online and it quotes Milton Friedman. I wish we would listen to Milton Friedman more often. This article below quotes Friedman and today I am starting a series […]
What does created equal mean according to Milton Friedman? In his article “A test for first among equals,” Arkansas News Bureau, September 30, 2011, Matthew Pate asserted: Among the most familiar passages in the Declaration of Independence is the section reading, “We hold these truths to be self-evident, that all men are created equal, that […]
Milton Friedman’s solution to limiting poverty Liberals just don’t get it. They should listen to Milton Friedman (who is quoted in this video below concerning the best way to limit poverty). New Video Shows the War on Poverty Is a Failure Posted by Daniel J. Mitchell The Center for Freedom and Prosperity has released another […]
Friedman Friday” Free to Choose by Milton Friedman: Episode “Created Equal” (Part 3 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 […]
Free to Choose by Milton Friedman: Episode “Created Equal” (Part 2 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 […]
I am currently going through his film series “Free to Choose” which is one the most powerful film series I have ever seen. PART 4 of 7 The massive growth of central government that started after the depression has continued ever since. If anything, it has even speeded up in recent years. Each year there […]
If you would like to see the first three episodes on inflation in Milton Friedman’s film series “Free to Choose” then go to a previous post I did. Ep. 9 – How to Cure Inflation [4/7]. Milton Friedman’s Free to Choose (1980) Uploaded by investbligurucom on Jun 16, 2010 While many people have a fairly […]
President Bush spoke about the life and career of Milton Friedman at a ceremony honoring him for his work and impact in the field of economics. Friedman was awarded a Nobel Prize in 1976
Milton Friedman, recipient of the 1976 Nobel Prize for Economic Science, was a Senior Research Fellow at the Hoover Institution, Stanford University, from 1977 to 2006. He was also Paul Snowden Russell Distinguished Service Professor Emeritus of Economics at the University of Chicago, where he taught from 1946 to 1976, and was a member of the research staff of the National Bureau of Economic Research from 1937 to 1981.
Professor Friedman was awarded the Presidential Medal of Freedom in 1988 and received the National Medal of Science the same year. He is widely regarded as the leader of the Chicago School of monetary economics, which stresses the importance of the quantity of money as an instrument of government policy and as a determinant of business cycles and inflation.
In addition to his scientific work, Professor Friedman had also written extensively on public policy, always with primary emphasis on the preservation and extension of individual freedom. His most important books in this field are (with Rose D. Friedman) Capitalism and Freedom (University of Chicago Press, 1962); Bright Promises, Dismal Performance (Thomas Horton and Daughters, 1983), which consists mostly of reprints of tri-weekly columns that he wrote for Newsweek from 1966 to 1983; and (with Rose Friedman) Free to Choose (Harcourt Brace Jovanovich, 1980), which complements a ten-part TV series of the same name, shown over PBS in early 1980, and (with Rose D. Friedman) Tyranny of the Status Quo (Harcourt Brace Jovanovich, 1984), which complements a three-part TV series of the same name, shown over PBS in early 1984.
He was a member of the President’s Commission on an All-Volunteer Armed Force (1969-70) and of the President’s Commission on White House Fellows (1971-73). He was a member of President Reagan’s Economic Policy Advisory Board, a group of experts outside the government, named in early 1981 by President Reagan.
He had also been active in public affairs, serving as an informal economic adviser to Senator Goldwater in his unsuccessful campaign for the presidency in 1964, to Richard Nixon in his successful campaign in 1968, to President Nixon subsequently, and to Ronald Reagan in his 1980 campaign.
Cato President Ed Crane and Milton Friedman at the
2004 Milton Friedman Prize for Advancing Liberty
He had published many books and articles, most notably A Theory of the Consumption Function (University of Chicago Press, 1957), The Optimum Quantity of Money and Other Essays (Aldine, 1969), and (with A. J. Schwartz) A Monetary History of the United States (Princeton University Press, 1963), Monetary Statistics of the United States (Columbia University Press, 1970), and Monetary Trends in the United States and the United Kingdom (University of Chicago Press, 1982).
Professor Friedman was a past president of the American Economic Association, the Western Economic Association, and the Mont Pelerin Society, and is a member of the American Philosophical Society and of the National Academy of Sciences.
He also had been awarded honorary degrees by universities in the United States, Japan, Israel, and Guatemala, as well as the Grand Cordon of the First Class Order of the Sacred Treasure by the Japanese government in 1986.
Friedman received a B.A. in 1932 from Rutgers University, an M.A. in 1933 from the University of Chicago, and a Ph.D. in 1946 from Columbia University.
He and his wife established the Milton and Rose D. Friedman Foundation, for the purpose of promoting parental choice of the schools their children attend. The Foundation is based in Indianapolis and its president and chief operating officer is Gordon St Angelo.
He and his wife published their memoirs: Milton and Rose D. Friedman, Two Lucky People: Memoirs (University of Chicago Press, 1998).
On November 16, 2006, Dr. Friedman passed away at the age of 94 in San Francisco.
Member, Mont Pelerin Society (American Secretary, 1957-62; Member of Council, 1962-65; Vice President, 1967-70; President, 1970-72; Vice President, 1972-80)
Member, The Philadelphia Society (Board of Trustees, 1965-67, 1970-72, 1976-78)
Member, Royal Economic Society
Member, Western Economic Association (Vice President, 1982-83; President-elect, 1983-84; President, 1984-85)
Elected Societies
Fellow, American Statistical Association
Fellow, Econometric Society (Board of Editors, Econometrica, 1957-69)
Fellow, Institute of Mathematical Statistics
Member, American Philosophical Society, 1957-
Associate Member, Belgian Royal Academy of Science, Letters and Fine Arts, 1971-
Member, National Academy of Sciences, 1973-
Foreign Member, Accademia Nazionale dei Lincei (Italy), 1978-
Fellow, Jewish Academy of Arts and Sciences, 1986-
Fellow, National Association of Business Economists, 1989-
Active Member, Academia Scientiarum et Artium Europaea (European Academy of Sciences and Arts), 1992-
Other Activities
Council of Academic Advisers, American Enterprise Institute, 1956-79
Member, Board of Directors, Aldine Publishing Company, 1961-76
Policy-holder Elected Trustee, CREF, 1964-68
Advisory Board, Journal of Money, Credit, and Banking, 1968-94
Member, The President’s Commission on an All-Volunteer Armed Force, 1969-70
Member, The President’s Commission on White House Fellows, 1971-73
Member, Advisory Committee on Monetary Statistics, Federal Reserve System 1974
Member, The President’s Economic Policy Advisory Board, 1981-88
Honorary Adviser, Institute for Monetary and Economic Studies of the Bank of Japan, October 1982-86
Presenter of a ten-part TV series on PBS called “Free to Choose,” January-March 1980. The same series in shortened form (six parts) was also aired on BBC in England, February-March 1980. “Free to Choose” was also shown in other countries, including Australia, Holland, Japan, and Singapore. An updated tenth anniversary edition of “Free to Choose,” consisting of five parts, was aired on CNBC early in 1991.
Presenter of three one-half hour TV programs called “Tyranny of the Status Quo” on PBS in March and April 1984
Founding Member, National Coalition for Drug Policy Change, 1993
Chairman, Board of Directors, Milton and Rose D. Friedman Foundation, 1996-2006. (The mission of the foundation is to promote public understanding of the need for major reform in K-12 education and the role that competition through educational choice can play in achieving that reform.
Awards and Honors
John Bates Clark medallist (American Economic Association), 1951
Chicagoan of the Year (Chicago Press Club), 1972
Educator of the Year (Chicago Jewish United Fund), 1973
Nobel Prize for Economic Science, 1976
Scopus Award (American Friends of The Hebrew University), 1977
Private Enterprise Exemplar Medal (Freedoms Foundation at Valley Forge), 1978
Valley Forge Honor Certificate for speech on “The Future of Capitalism” (Freedoms Foundation at Valley Forge), 1978
George Washington Honor Medal (Freedoms Foundation at Valley Forge), 1978 and 1980
Gold Medal (National Institute of Social Sciences, New York), 1978
Statesman of the Year Award (Sales & Marketing Executives International), 1981
Ohio State Award for “Free to Choose” TV Series, 1981
New Perspectives Award for “Free to Choose” TV Series (Touche Ross & Co.), 1981
One of the 1980 Tuck Media Awards for Economic Understanding, for “Free to Choose” TV Series (Amos Tuck School of Business Administration, Dartmouth College), awarded in 1981
Grand Cordon of the First Class Order of the Sacred Treasure (Japanese Government), 1986
National Medal of Science, 1988
Presidential Medal of Freedom, 1988
Institution of World Capitalism Prize (Jacksonville University), 1993
Goldwater Award (Goldwater Institute), 1997
Robert Maynard Hutchins History Maker Award for Distinction in Education (Chicago Historical Society), 1997
Source Award for Lifetime Achievement (The Primary Source, Tufts University), 1997
The on-going debate over raising the debt ceiling has focused on many areas of disagreement between Democrats and Republicans but none bigger than the Republican determination not to raise taxes. Many pundits credit this to the political power of Grover Norquist and his Americans for Tax Reform who have spent years collecting “No Tax Increase” pledges from Republican candidates. Others attribute Republican intransigence on taxes to a near religious belief in supply side economics, a school of thought founded by economist Arthur Laffer and journalist Jude Wanniski in the late 1970s.
The true seeds of this attitude toward tax increases, in my view, actually go back farther and can be traced to an even nobler pedigree. The real inspiration for this conviction comes from the late Nobel prize-winning economist, Milton Friedman. It is only by understanding Friedman’s reasoning and his values that one can fully understand why Republican refuse to see spending cuts and tax increases as simply two sides of the same budget-balancing coin.
This was not always the Republican, or even the conservative, position. During the 1950s, it was Democrats who advocated tax cuts to stimulate the economy and President Eisenhower who insisted “we can never justify going further into debt to give ourselves a tax cut at the expense of our children.”
In 1964, the eventual Republican nominee for president, Senator Barry Goldwater, voted against the so-called Kennedy tax cuts (actually passed after Kennedy’s assassination the previous year) because he was convinced the resulting deficits would be inflationary. Even after losing the presidential election to President Lyndon Johnson in a landslide later that year, Goldwater predicted a Republican comeback, telling U.S. News & World Report that a no-win war in Vietnam and high inflation would prompt a backlash against the Democrats two years later (he was right on both counts).
So if Eisenhower and Goldwater represented Republican orthodoxy in the 1950s and ‘60s, what happened? In large part, it was an intellectual revolution in conservative/libertarian thought prompted by economist Milton Friedman. While Friedman rejected the simplistic Keynesian (and later supply-side) notion that tax cuts automatically stimulate the economy, he believed that higher taxes were bad because they led to more and bigger government, which he was convinced at best led to waste and at worse to greater government control over our economy, our lives and our freedoms.
In 1967, three year’s after the Kennedy tax cuts, the Johnson Administration was already running huge deficits thanks to the a combination of Great Society social programs and the Vietnam War. Writing in his regular Newsweek column on August 7, 1967, Friedman expresseded his concern that this would soon lead to higher taxes, using an analysis that would become familiar to his readers over the years:
“.If we adopt such programs, does not fiscal responsibility at least call for imposing taxes to pay for them? The answer is that postwar experience has demonstrated two things. First, that Congress will spend whatever the tax system will raise—plus a little (and recently, a lot) more. Second, that, surprising as it seems, it has proved difficult to get taxes down once they are raised. The special interests created by government spending have proved more potent than the general interest in tax reduction.
“If taxes are raised in order to keep down the deficit, the result is likely to be a higher norm for government spending. Deficits will again mount and the process will be repeated.”
Sure enough, a year later a 10% income tax surcharge was enacted by Congress to cut the deficit and fight inflation. His prediction having been confirmed, Friedman returned to the subject in another Newsweek column dated July 15, 1968. He now described a familiar pattern of how Democrats used the traditional view of fiscal conservatism to convince Republicans to help pay for the Democrats’ own profligate spending:
“The standard scenario has been that the Democrats—in the name of the New Deal, the Fair Deal, or the Great Society—push through large spending programs . . . generally against the opposition of the Republican leadership. The spending programs not only absorb the increased tax yield generated by the ‘fiscal drag,’ they go farther and produce deficits.
“The Democrats then appeal to the Republicans’ sense of fiscal responsibility to refrain from cutting tax rates or, as in this case, to raise them. The Republicans cooperate, thereby establishing a new higher revenue base for further spending. The Democrats get the ‘credit’ for the spending; the Republicans, the ‘blame’ for the taxes; and you and I pay the bill.”
Fast forward seven years, when Republican President Gerald Ford was proposing a tax cut to stimulate the economy during a brief recession. As an economist who believed monetary, not fiscal, policy was the best way to keep the economy on a stable path to growth, Friedman did not believe the proposed tax cut would have its intended stimulatory effect. He explained why in another Newseek column on July 15, 1975 but went on to say:
“Yet I must confess that I favor tax cuts—not as a cure for recession but for a very different reason. Our basic long-term need is to stop the explosive growth in government spending. I am persuaded that the only effective way to do so is by cutting taxes—at any time for any excuse in any way.
“The reason is that government will spend whatever the tax system raises plus a good deal more—but not an indefinite amount more. The most effective way to force each of us to economize is to reduce our income. The restraint is less rigid on government, but it is there and seems to be the only one we have.
“So hail the tax cut—but let’s do it for the right reason.”
Another six years went by and now it was the newly-elected president, Ronald Reagan, who was proposing a large, multi-year tax cut to get the economy moving. At the time, he was also proposing off-setting spending cuts (which we all know didn’t happen). Friedman wrote yet another Newsweek column dated July 27, 1981, refuting objections to the plan by liberal economists while also discounting many of the claims of supply-siders in the Reagan Administration. Friedman still supported the tax cuts, of course, and explained why liberals were suddenly worried about deficits:
“The analysis so far treats government spending and taxes as if they were two independent entities. They clearly are not. We know full well that Congress will spend every penny—and more—that is yielded by taxes. A cut in taxes will mean a cut in government spending. And there is no other way to get a cut in spending.
“That is the real reason why the big spenders and the big inflationists of the past have suddenly been converted to fiscal conservatism and to preaching the virtues of fighting inflation. They know that a multi-year tax cut will force multi-year spending reductions. They hope that a one-year tax cut will quiet public agitation and allow them to revert next year to their high-spending ways.”
Taken as a whole, these excerpts from columns written for a popular magazine by a Nobel laureate economist between 1967 and 1981—44 to 30 years ago—spell out precisely the philosophy that today motivates many Republicans in and out of Congress to firmly oppose any tax increase as part of a deficit reduction or budget-balancing plan proposed by Democrats.
Like Milton Friedman, they are firmly convinced that any taxes they raise will ultimately result in increased government spending. They believe government spending necessarily translates into more and bigger government. They believe the federal government is already too big, threatening not just the health of the economy but their freedom and way of life as well.
One can argue with Friedman’s assumptions as well as the conclusions he draws from them. But until those on the other side—including the President, Democratic congressional leaders and the media—understand the reasoning and motivations behind the anti-tax sentiments of Republicans from Capitol Hill to the Tea Party activists, it’s hard to imagine anything more than a temporary truce in the battle being waged over the budget.
Milton Friedman videos and transcripts Part 11 On my blog http://www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching […]
Milton Friedman – White House Tribute (2002) Published on May 31, 2012 by BasicEconomics President Bush spoke about the life and career of Milton Friedman at a ceremony honoring him for his work and impact in the field of economics. Friedman was awarded a Nobel Prize in 1976 ___________ Milton Friedman – Biography From Milton […]
MILTON FRIEDMAN: THE MIND BEHIND THE REPUBLICAN TAX REVOLT Jack Roberts | Jul 22, 2011 | 0 comments The on-going debate over raising the debt ceiling has focused on many areas of disagreement between Democrats and Republicans but none bigger than the Republican determination not to raise taxes. Many pundits credit this to the […]
Milton Friedman videos and transcripts Part 10 On my blog http://www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching […]
Milton Friedman – Power of Choice (Biography) Part 3 Published on May 21, 2012 by BasicEconomics Tribute to Milton Friedman English Pages, 8. 9. 2008 Dear colleagues, dear friends, (1) It is a great honor for me to be asked to say a few words to this distinguished and very knowledgeable audience about one of our greatest […]
Milton Friedman on the American Economy (6 of 6) Uploaded by donotswallow on Aug 9, 2009 THE OPEN MIND Host: Richard D. Heffner Guest: Milton Friedman Title: A Nobel Laureate on the American Economy VTR: 5/31/77 _____________________________________ Below is a transcipt from a portion of an interview that Milton Friedman gave on 5-31-77: Friedman: […]
Milton Friedman videos and transcripts Part 9 On my blog http://www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching […]
Below is a discussion from Milton Friedman on Bill Clinton and Ronald Reagan. February 10, 1999 | Recorded on February 10, 1999 audio, video, and blogs » uncommon knowledge PRESIDENTIAL REPORT CARD: Milton Friedman on the State of the Union with guest Milton Friedman Milton Friedman, Senior Research Fellow, Hoover Institution and Nobel Laureate in […]
Biography Part 2 In 1977, when I reached the age of 65, I retired from teaching at the University of Chicago. At the invitation of Glenn Campbell, Director of the Hoover Institution at Stanford University, I shifted my scholarly work to Hoover where I remain a Senior Research Fellow. We moved to San Francisco, purchasing […]
Milton Friedman was a great economist and a great american. A Tribute to Milton Friedman by Mark Skousen on November 28, 2006 Mark Skousen and Milton Friedman at lunch I was at the New Orleans Investment Conference when I learned that free-market economist extraordinaire Milton Friedman, died on November 16. He was a dear friend. […]
On my blog www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching for Milton Friedman also.
Milton Friedman videos and transcripts Part 3 On my blog http://www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching […]
Milton Friedman videos and transcripts Part 2 On my blog http://www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching […]
Milton Friedman videos and transcripts Part 1 On my blog http://www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching […]
Uploaded by YAFTV on Aug 19, 2009 Here is the first part of the interview: Written By : John Hawkins Yesterday, I did a twenty minute interview by phone with Milton Friedman. Of course, Mr. Friedman has an INCREDIBLE resume. He won the 1976 Nobel Memorial Prize for economic science, won the “Presidential Medal of […]
Myth:Conservative Herbert Hoover responsible for Depression When I grew up I always heard that the conservative Herbert Hoover was responsible for the depression. Is that true? The Hoover Myth Marches On Posted by David Boaz In the New York Times today, columnist Joseph Nocera quotes a book published in 1940 on Herbert Hoover and the Great Depression: […]
I am currently going through his film series “Free to Choose” which is one the most powerful film series I have ever seen worked pretty well for a whole generation. Now anything that works well for a whole generation isn’t entirely bad. From the fact __ from that fact, and the undeniable fact that things […]
Uploaded by YAFTV on Aug 19, 2009 Nobel Laureate Dr. Milton Friedman discusses the principles of Ronald Reagan during this talk for students at Young America’s Foundation’s 25th annual National Conservative Student Conference MILTON FRIEDMAN ON RONALD REAGAN In Friday’s WSJ, Milton Friedman reflectedon Ronald Reagan’s legacy. (The link should work for a few more […]
Milton Friedman – The Social Security Myth Uploaded by LibertyPen on Mar 5, 2010 Using Social Security as his prime example, Professor Friedman explodes the myth that the major expansions in government resulted from popular demand. In a speech delivered more than 30 years ago, he directly relates this dynamic to today’s health care debate. […]
Free to Choose by Milton Friedman: Episode “What is wrong with our schools?” (Part 4 of transcript and video) Here is the video clip and transcript of the film series FREE TO CHOOSE episode “What is wrong with our schools?” Part 4 of 6. Volume 6 – What’s Wrong with our Schools Transcript: It seems to me […]
Tax increases are not the way to go, but the president doesn’t get that. Liberals love tax increases. Seven Reasons Why Tax Increases Are the Wrong Approach Uploaded by CFPEcon101 on May 3, 2011 This Economics 101 video from the Center for Freedom and Prosperity gives seven reasons why the political elite are wrong to […]
Free to Choose by Milton Friedman: Episode “What is wrong with our schools?” (Part 3 of transcript and video) Here is the video clip and transcript of the film series FREE TO CHOOSE episode “What is wrong with our schools?” Part 3 of 6. Volume 6 – What’s Wrong with our Schools Transcript: If it doesn’t, they […]
Free to Choose by Milton Friedman: Episode “What is wrong with our schools?” (Part 2 of transcript and video) Here is the video clip and transcript of the film series FREE TO CHOOSE episode “What is wrong with our schools?” Part 2 of 6. Volume 6 – What’s Wrong with our Schools Transcript: Groups of concerned parents […]
I am currently going through his film series “Free to Choose” which is one the most powerful film series I have ever seen. PART 5 of 7 MCKENZIE: Ah, well, that’s not on our agenda actually. (Laughter) VOICE OFF SCREEN: Why not? MCKENZIE: I boldly repeat the question, though, the expectation having been __ having […]
(1) It is a great honor for me to be asked to say a few words to this distinguished and very knowledgeable audience about one of our greatest heroes, about one of the past Mont Pelerin Society presidents, about a friend of many of us, Milton Friedman. This is the first MPS General Meeting after his passing away in December 2006 and it is our duty to remember him here today and to say very clearly, loudly and explicitly how much we all owe him.
I am not sure I deserve to be privileged to speak on this very special occasion. Even though I met Milton many times in many places of the world in the past 19 years, I was not his long time colleague, collaborator or a close personal friend. I was probably chosen to speak here on behalf of his admirers and pupils. I am proud to declare that I am one of them.
My first opportunity to see him and exchange a few words with him was during the Munich meeting of our Society in 1990. For most of my life, which was spent in the communist era, I was just able to read about him and – what was much more important – to read him. Very early, he became one of my most important teachers – of course, at a distance. I considered and I do consider him, and I suppose most of you share my view, to be one of the greatest thinkers of the 20th century.
As I said, I succeeded in meeting him personally for the first time after the collapse of communism, after the fall of the Iron Curtain, after those historic events he – directly or indirectly – but very substantially influenced. For us, who lived in the communist world, Milton was the greatest champion of freedom, of limited and unobtrusive government and of free markets. (2)
He was for many reasons important for the people in the West, North and South, but he was crucial for us in the East. We studied him very carefully. It was, of course, difficult to get his „Capitalism and Freedom“. It was not easy to see his Newsweek columns, but it was possible to get The Journal of Political Economy, The American Economic Review or the Journal of Money, Credit and Banking in the public library even in the darkest communist days. Some of us read such journals and some of us even understood that his contributions were more important than the writings of most of other economists. (3)
He was – without a doubt – one of the most influential academic economists of the second half of the 20th century. We certainly do not plan to analyze his achievements in economic theory here today but we should at least mention his theoretical works in the fields of the theory of money, of the theory of the consumption function, his arguments for flexible exchange rates and for free trade, his ideas on the methodology of science and his views on economic, especially monetary policy. His more general texts about freedom, about the relationship between the individual and the state, about markets and planning, about alternative economic systems were not less fundamental. The books „Capitalism and Freedom“ and „Free to Choose“ influenced millions of people all over the world.
We all admired him for the clarity of his thinking as well as for his intellectual stubbornness and – at the same time – for his personal kindness and charm. Nothing captures or summarizes his life better than the title of the book he wrote together with Rose: „Two Lucky People“. From what I know, I can confirm that they were lucky, that they were lucky together and I would add that we were lucky to have had Milton Friedman. Some of us were even privileged to know him personally, to play tennis with him or skiing together in Whistler mountains. We are really missing him. We all owe a lasting debt to him.
THE OPEN MIND
Host: Richard D. Heffner
Guest: Milton Friedman
Title: A Nobel Laureate on the American Economy VTR: 5/31/77
_____________________________________
Friedman: And insofar as I can give any assistance, I am delighted to, both because of my general desire to see freedom prosper, and also because I have a very strong personal sympathy and interest in Israel. I am Jewish by origin and culture. I share their values and their belief. I share the admiration which many have had for the miracles that have occurred in Israel. So if I can make any contribution to a more effective policy for preserving Israel, Israel’s freedom and strength, I would certainly be delighted to do so.
HEFFNER: Let’s turn now, in the moments we have remaining, from Israel to our own home. You had a plus and a minus evaluation of these past two years before. In terms of the president’s attitudes as well as actions, how do you, given your approach to the needs of this country, evaluate President Carter?
FRIEDMAN: Well, I have always argued that you will not solve problems by electing the right man to the White House.
HEFFNER: Certainly not by electing the wrong man.
FRIEDMAN: Yes. The only way you will ever solve problems, in my opinion, in moving the direction we want to move, is by making it a political interest of the wrong people to do the right thing.
HEFFNER: Go ahead. Spin that one out, Professor Friedman.
FRIEDMAN: I’m not knocking it. I do not want a dictator. You do not want a dictator. We want a man as president who is responsive to the will of the people. Now, we also want a man who will exercise leadership. We also want a man who will distinguish between a momentary whim of the people and some longer-run will. And we want a man who will stand up for what he believes, but not too far. Not beyond the point where he destroys his country in the process.
Now, as I look at President Carter, I think his political interests have, to a large extent, coincided with many of his personal values. He is a small, has been a small businessman. He comes from the South, he is fiscally prudent. His desire, I’m sure, to move toward a balanced budget is serious, is sincere and honest. And it has been politically prudent to do so, because we have been in the course of a very good expansion. The economy is growing. The real threat is a rise in inflation, not a recession at the moment. It’s in his political interest to try to keep this expansion going as long as he can. So fiscal conservatism in that sense has been both consistent with his principles and politically profitable. However, he wants fiscal conservatism for a different reason than I do. I want fiscal conservatism to reduce the scope of government. He wants it to enable government to exercise greater power in achieving what he considers desirable objectives. He is not a “conservative” in any way whatsoever, so far as I can see, in the sense of being in favor of a small government. He has come out openly in favor of vast expansions in government power. He has come out in favor of a national health insurance program which would, in my opinion, be a medical as well as a social and financial disaster in the United States. His energy program, as I mentioned earlier, is not a program which is designed to give the market greater play; it’s a program for running things through government. He is fundamentally, as so many people have pointed out, an engineer. That’s his background, that’s his training, that’s his disposition.
HEFFNER: You’re saying he’s also a social engineer though.
FRIEDMAN: Of course. He’s an engineer. And he’s in a position…where can he engineer? On the social level. He is a social engineer. And he believes in it. I’m not questioning that. From that point of view, I believe his principles are very undesirable for what we need for the future. Now, how it will work out…
HEFFNER: Now, in terms of what you said, that may work out well.
FRIEDMAN: What?
HEFFNER: In terms of what you said a moment ago, that may work out well.
FREIDMAN: It may. That depends, exactly. That’s why I say that what matters to me is much less what his own beliefs are than what you and the others out there and what the people of this country decide they want their government to do. Let’s not kid ourselves. The government is responsive to the public. This is a democracy. If we have been moving in the direction of collectivism, if we have been destroying the springs of private initiative and private freedom, if we have been restricting ourselves in many areas as we have, it is because the public at large has sent instructions to Washington to do that. Take a simple case. We all bemoan inflation. Inflation is terrible, it’s awful. Nobody likes inflation. Why do we have inflation? Because we the citizens have demanded it. We have sent a message to Washington. We said, “We want you to spend more on roads, we want you to spend more on health, we want you to spend more on education. But don’t tax us for it. We don’t like those damn taxes.” What happens? Congress listens. It votes more expenditures. It doesn’t vote taxes enough to cover them. But after all, the difference has to be paid for somehow. And so the difference is paid for by the hidden tax of inflation, which is the only tax that can be imposed on the American people without anybody having to vote for it. And so that inflation, we’re responsible for the inflation. Other people have been the intermediaries, but we’re ultimately responsible. Well, in the way, whether Mr. Carter’s propensities are a force for good or ill will depend in a very large measure, almost entirely, on what the sentiment of the public is, what is politically feasible, what is politically profitable for him to do. And that’s where the changing attitudes and ideas of the public play such a large role.
HEFFNER: In coming full circle as we end the program, I gather you do feel that you see signs of a changing attitude on the part of the public.
FRIEDMAN: Oh, there’s no doubt about that. Changing attitude on the part of the public, there’s no doubt about their reaction to the New York case. There’s no doubt about their loss of confidence in the ability of government programs to achieve their objective. You know, if you want to get a laugh out of anybody you talk about the post office. And it’s a universally understood thing. When I say when I try to talk against the energy program is to say, “Are you really seriously suggesting that we should turn over the production and distribution of energy to the people who run the post office? That’s what Mr. Carter is proposing.” And that gets a laugh out of people. Why? Because attitudes and views are changing.
HEFFNER: I think we’ll look again maybe two years down the road as to whether they’ve changed in the direction that you want or not. Thank you so much for joining me today, Professor Milton Friedman. It was a very, very great pleasure to talk with you once again.
FRIEDMAN: I’m very glad.
HEFFNER: And thanks, too, to you in the audience. I hope that you will join me again on The Open Mind. Meanwhile, as an old friend used to say, “Good night, and good luck.”
On my blog www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching for Milton Friedman also.
Milton Friedman videos and transcripts Part 3 On my blog http://www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching […]
Milton Friedman videos and transcripts Part 2 On my blog http://www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching […]
Milton Friedman videos and transcripts Part 1 On my blog http://www.thedailyhatch.org I have an extensive list of posts that have both videos and transcripts of MiltonFriedman’s interviews and speeches. Here below is just small list of those and more can be accessed by clicking on “Milton Friedman” on the side of this page or searching […]
Milton Friedman was born on July 31, 1912 and he died November 16, 2006. I started posting tributes of him on July 31 and I hope to continue them until his 100th birthday. Here is another tribute below: The massive growth of central government that started after the depression has continued ever since. If anything, […]
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 [5/7]. Milton Friedman’s Free to Choose […]
Milton Friedman was born on July 31, 1912 and he died November 16, 2006. I started posting tributes of him on July 31 and I hope to continue them until his 100th birthday. Here is another tribute below: Worse still, America’s depression was to become worldwide because of what lies behind these doors. This is […]
99th anniversary of Milton Friedman’s birth (Part 16) Milton Friedman was born on July 31, 1912 and he died November 16, 2006. I started posting tributes of him on July 31 and I hope to continue them until his 100th birthday. Here is another tribute below: George Eccles: Well, then we called all our employees […]
99th anniversary of Milton Friedman’s birth (Part 15) Milton Friedman was born on July 31, 1912 and he died November 16, 2006. I started posting tributes of him on July 31 and I hope to continue them until his 100th birthday. Here is another tribute below: Milton Friedman’s Free to Choose (1980), episode 3 – […]
I am currently going through his film series “Free to Choose” which is one the most powerful film series I have ever seen. TEMIN: We don’t think the big capital arose before the government did? VON HOFFMAN: Listen, what are we doing here? I mean __ defending big government is like defending death and taxes. […]
Milton Friedman: Life and ideas – Part 06 99th anniversary of Milton Friedman’s birth (Part 14) Milton Friedman was born on July 31, 1912 and he died November 16, 2006. I started posting tributes of him on July 31 and I hope to continue them until his 100th birthday. Here is another tribute below: November […]
Here is the video clip and transcript of the film series FREE TO CHOOSE episode “What is wrong with our schools?” Part 6 of 6. Volume 6 – What’s Wrong with our Schools Transcript: FRIEDMAN: But I personally think it’s a good thing. But I don’t see that any reason whatsoever why I shouldn’t have been required […]
Here is the video clip and transcript of the film series FREE TO CHOOSE episode “What is wrong with our schools?” Part 5 of 6. Volume 6 – What’s Wrong with our Schools Transcript: Are your voucher schools going to accept these tough children? COONS: You bet they are. (Several talking at once.) COONS: May I answer […]
Milton Friedman and Ronald Reagan John Brummett is critical of Republicans for opposing the payroll tax reduction and I have to agree with him on this. In an interview shortly after the Bush Tax Cuts passed Milton Friedman was asked: John Hawkins:Do you think George Bush, with the economy being as it was, did the […]
Milton Friedman, Senior Research Fellow, Hoover Institution and Nobel Laureate in Economic Sciences grades the achievements of the Clinton administration and evaluates the programs the President proposed in his 1999 State of the Union address.
ROBINSON Just the last eight years, or would you give high marks to Volcker as well, Greenspan’s predecessor?
FRIEDMAN That’s an interesting case, because you have to give the credit there really to Reagan. There’s no other President who would have stood by while the Fed followed the policy it did. If you remember— you don’t remember that period but if you go back…
ROBINSON I do actually, I had just started at the White House in those days…
FRIEDMAN …if you go back to that period, stopping the inflation that was raging which reached double-digit levels at the end of the ’70s and early ’80s required stepping on the brakes hard and produced a recession. And if you remember, Reagan’s popular ranking went way down in…
ROBINSON Down into the thirties.
FRIEDMAN …thirties, right. No other President would have stood by and said to the Fed, keep doing what you’re doing, you’re doing the right thing. But Reagan did do that. And that’s what enabled Volcker to do what Volcker did.
ROBINSON Back to the present to find out what Milton Friedman thinks of President Clinton’s legislative goals for the rest of his term.
THE SUNSHINE PLOYS
ROBINSON Let me ask you to apply your thinking to the principle points of Bill Clinton’s program for the remaining couple of years in office. The President’s program is intended— we’ll take old folks first— to, I quote now, “Address the challenge of a senior boom by using the budget surplus to help save Social Security.”
FRIEDMAN Well, the proposal, if you look at it in detail, is a complete fake.
ROBINSON A complete fake?
FRIEDMAN Absolutely.
ROBINSON He wants to take sixty percent— a little more than sixty percent of budget surplus over the next fifteen years…
FRIEDMAN Where does that come from? He’s counting that twice. That comes from the proceeds of the payroll taxes that are now in, which, in principle, though not in practice, are supposed to be used for Social Security, but which have indeed been financing every regular event. If he doesn’t do a thing about the surplus, that would still end up in bonds in the hands of the Social Security so-called Trust Fund.
ROBINSON You say he’s guilty of a little bit of a flim-flam game with the books.
FRIEDMAN Absolutely.
ROBINSON Within forty-eight hours of that State of the Union Address in which he made this proposal, Alan Greenspan, whom you have just praised, endorsed the proposal— in general terms, not specific terms, but he endorsed the proposal— and the Republicans in Congress said yep, that’s a good idea, sign us up for that too. How is it that he’s able to get everybody to go for what you call a flim-flam game?
FRIEDMAN Look, do you need to ask that question now after six years of Clinton? How he’s been able to get one flim-flam game after another. How he’s been able to bamboozle the people into thinking that he deserves higher ratings because he lies. Clinton is a superb politician who has a most extraordinary capacity to exude sincerity. He’s an incredible phenomenon. I think he’s a genius. But go back to the Social Security program. The first thing to be said is that all this nonsense about saving something for Social Security is pure fiction. It’s wrong to think that what people are paying into Social Security, what people are paying in the form of wage taxes, is what they’re paying for their own security. [
ROBINSON That’s nonsense.] There is no relationship whatsoever. We have a system under which you have a set of taxes for Social Security— named for Social Security, but it doesn’t matter, they’re payroll taxes, terrible taxes, regressive taxes. Nobody… you could not get a legislature to vote such a tax on its own. Can you imagine proposing a tax that would impose — let’s say sixteen percent tax— on all wages from the first dollar up to the maximum and nothing beyond that. Can you imagine voting that? Similarly, the other side of the picture is that we have made a series of commitments to people like me— I receive Social Security payments…
ROBINSON Oh so, it’s my payroll tax that goes to…
FRIEDMAN Absolutely. Absolutely. It’s not only your payroll tax, it’s your income tax, it’s whatever taxes you pay. I get them. And if you think you’re going to get ’em, you’re kidding yourself.
ROBINSON It is a fundamental deceit hoisted upon the American people and sustained for lo these six decades.
FRIEDMAN Absolutely. If you read the Social Security brochures, they say this is a system under which you are putting aside money now for your retirement.
ROBINSON And that’s nonsense.
FRIEDMAN That is utterly fake. But let’s suppose it were true…
ROBINSON All-right.
FRIEDMAN …for a moment. Why is it that it’s appropriate for government to come and tell me what fraction of my income I should save for my old age? If that’s okay, why can’t it come in and tell me exactly what fraction of my income I have to spend for food, what fraction for housing, what fraction for clothing. Let me show you the absurdity of this.
ROBINSON All-right.
FRIEDMAN Consider a young man of thirty-five who has AIDS for whom the expected length of life is ten years at the most maybe. Maybe there’ll be a cure. But his expected length of life is not very long. Is it really intelligent for him to put aside fifteen percent of his income for retirement at age sixty-five?
ROBINSON It’s outrageous.
FRIEDMAN It’s outrageous.
ROBINSON Outrageous.
FRIEDMAN Exactly. The only word you can give to it. And in my opinion, the whole Social Security system is an outrage.
ROBINSON If Social Security is ‘an outrage,’ what would Milton Friedman do about it? A Bonding Experience
ROBINSON How would you get rid of it?
FRIEDMAN Very simply. Here I am, I’m entire to a certain number of payments in the future. Have the government give me a bond equal to the current present value of— expected value of what I’m entitled to. You have already accumulated some rights. And so have the government give you a bond which will be due when you’re sixty-five which will be the present value of what you’ve already accumulated under the law. And then close the whole thing up.
ROBINSON And just close the books.
FRIEDMAN Everybody gets what he’s entitled to— what he’s been promised. The unfunded debt under Social Security is funded, it’s made open and above-board. There’s not a penny of transition cost, and everybody is… In my world, the payroll tax would be abolished, would be eliminated. It’s the worst tax we have on the books. And everybody would be free to do what he wanted about his own retirement.
ROBINSON Okay.
FRIEDMAN And on the whole he would do very well. Now undoubtedly, people who argue against that say, well what are you going to do about these people who are so careless and so unprudent that they don’t accumulate anything for retirement. That’s a general problem. What do you do about people who are poor, whether for their own fault or not for their own fault? You and I and society in general is not willing to see ’em starve to death.
ROBINSON Correct.
FRIEDMAN Well, I have always been in favor of having a program under which (a negative income tax) under which you will have some income minimum you will provide for people whether they are indigent because they’re wastrels or whether they’re indigent because they’re in bad health…
ROBINSON Even if it’s their own fault, they don’t starve.
FRIEDMAN The problem is, it’s always seemed to me absurd that you make a hundred percent of the people do something in order to make sure that one or two percent of the people don’t behave badly.
ROBINSON Milton, that negative income tax proposal actually started to go someplace, if I remember my history correctly, that actually started to go someplace during the Nixon years, didn’t it? Didn’t Cap Weinberger…
FRIEDMAN Yes, it did… No, Moynihan, Pat Moynihan…
ROBINSON Moynihan. And what happened to it? Why did it die?
FRIEDMAN Because the public pressure was converted into a program that I testified against. It’s what happens in Washington all the time.
ROBINSON Right, right, okay.
ROBINSON Next question. What would Milton Friedman do with the mounting budget surplus?
SAVING PRIVATE EARNING
ROBINSON We’ve got seventy-nine, eighty billion dollars more coming in this year than the government…
FRIEDMAN I am in favor of reducing taxes under any circumstances, for any excuse, with any reason whatsoever because that’s the only way you’re ever going to get effective control over government spending. Sooner or later [
ROBINSON Choke off the supply.] if you don’t reduce taxes to get rid of that surplus, it’s going to be spent. The rule from not only the last few years, hundreds of years, is that governments will spend whatever the tax system will raise plus as much more as they can get away with.
ROBINSON The Republicans are calling for a ten percent…
FRIEDMAN It’s not enough.
ROBINSON …cut. Not enough. What is… Now Dan Quayle, who’s running for President— this is the most extreme- extreme may be the wrong word but this is the most dramatic proposal I’m aware of that’s on the table anywhere at the moment— he’s called for a thirty percent cut. Is that enough?
FRIEDMAN I don’t know. I would cut it as much as you can get away with.
ROBINSON So you’d run the numbers and give back virtually all the surplus.
FRIEDMAN What do you mean give back? Not take.
ROBINSON Excuse me. It’s not take. You’d lower taxes…
FRIEDMAN You know, this idea of giving back, which is a word you use, assumes…
ROBINSON I take back my words, but go ahead and ram them down my throat.
FRIEDMAN …it assumes that every individual is a property of the government and that all of the income that you earn is really the government’s, and it decides how much you can keep and how much it gets. I’ve always said, it treats people as if they were running around with an IBM card on their back which says ‘do not mutilate, punch, or disturb.’
ROBINSON Right. You’ve got more money coming in at the moment than is going out.
FRIEDMAN You ought to reduce taxes by enough to generate…
ROBINSON You don’t want to pay down the debt.
FRIEDMAN Oh no. No, I want to generate a deficit because I want pressure on to get the government to spend less.
ROBINSON You like a federal deficit.
FRIEDMAN No, I don’t like a federal deficit, but I like lower government spending.
ROBINSON All-right. President Clinton has another proposal for using that surplus, and he calls them USA accounts. He’s proposing to use about eleven percent of the surplus over the next fifteen years or so to establish, I quote now from his speech, “universal savings accounts, USA accounts, to give all Americans the means to save,” again quotation here, “with extra help for the least able to save.” Details to follow. You like that idea?
FRIEDMAN No, I think it’s a terrible idea. You know, the idea is saying, I’m going to take your money, but then I’ll give it back to you if you do with it what I tell you to do. Is that a way you have a free society of free, self-reliant individuals who are responsible for themselves? It’s a terrible…
ROBINSON Do you even agree with the premise that the savings rate is too low in this country?
FRIEDMAN I don’t agree with that premise. What is the right savings rate?
ROBINSON Well, gee, you’re the Nobel Prize winner, I thought you’d be able to clue me in.
FRIEDMAN The right savings rate… In a world in which you did not have distortions, in which you did not have government stepping in and distorting the rate at which people save or not, the right saving rate is whatever all the people of the community simply want to save. How much you want to save, how much I want to save. Why shouldn’t people be free to save what they want?
ROBINSON Let’s move to a more theoretical question. Why do we end up with so many stupid government programs when we’re supposed to be so smart in our own private affairs?
THINK LOCALLY, ACT GLOBALLY
ROBINSON How is it, you credit great intelligence, shrewdness, on the part of individuals when they’re spending their own money and managing their own property in the marketplace, how can we all be so dumb when we give up being players in the marketplace and become citizens participating in the political process? We get hoodwinked by Clinton, we go for this crazy sham of Social Security, how can we be so dumb?
FRIEDMAN Because it’s always so attractive to be able to do good at somebody else’s expense. That the real problem of our government. Government is a way by which every individual believes he can live at the expense of everybody else. That’s— I’m just repeating what Bastiat said two centuries ago, more than two centuries ago. You know, the thing that people don’t really understand is that free societies of the kind we’ve been lucky enough to experience for the last hundred-hundred and fifty years are a very rare exception in human history. Most people, most of history, and at any one time, most people at any one time, have lived in tyranny and misery. And it’s only for a brief period, and why? It is precisely because once you get some government program in— may have been a very good idea, it’s always proposed for good reasons— once it gets in, it becomes a special privilege of a small group which has an enormously strong interest to maintain it, and you do not have any comparable group that has the interest to get rid of it. And therefore, the hardest thing in the world is to get rid of any government program, however badly it works. In fact, try to name any government programs that have been eliminated.
ROBINSON The draft. Well, that’s not a…
FRIEDMAN Yes, the draft is an example, it’s one of the rare examples of a program that has been eliminated. One of the others was Postal Savings. It used to be that the postal system had a savings system which became very popular as a result of the Great Depression. But it disappeared. Why? Because by accident when they set it up, they limited the interest they could pay on postal savings to two percent, and when the market rate got higher than that, all the money was taken out of postal savings and postal savings came to an end. But aside from that, can you name programs that have been eliminated because they failed? And so how will we set a limit on government, and keep it coming back, and the only thing I can see on the horizon that offers a real chance are term-limits.
ROBINSON Term limits?
FRIEDMAN Right now, being a politician is a lifetime career. Being a Congressman is a lifetime career.
ROBINSON Do we have any evidence in the states where term-limits apply that it has worked as you would like to see it work? Term-limits have been in effect here in California for about a decade now… They may have been enacted a decade ago, so they’ve been in effect for perhaps six years…
FRIEDMAN It’s a little early. We don’t really have any very good… However, it so happened, I had occasion to have a conversation the other day with a former Governor of Virginia: Allen, George Allen.
ROBINSON Who, everybody says he’s going to be running for the Senate. Against Chuck Robb.
FRIEDMAN Yes, that’s what he intends to do.
ROBINSON He intends to do. All-right.
FRIEDMAN However, he had, Virginia has a one-term four-year term for the Governor. And he said, you know, he said, if we had had a two-year term, if we had had the situation in most states, that you can run for a second term, I would have spent the third and fourth year of my term working for re-election. I would never have been able to get done what I got done. It was the first real hands-on testimonial I’ve seen to a term-limit. It’s not a good idea for being a legislator to be a lifetime profession. The founders of our country had the idea of legislation as a part-time activity. It is in many states today. But at the federal government level, it’s a full-time profession. And that is very unhealthy because the legislature— it’s not a criticism of the individual— but any human being in that position, he’s going to sit in committee meetings, and day after day he’s going to hear arguments, good arguments, worthy arguments for new programs. He’s going to get very few arguments for getting rid of programs. And the evidence is clear: the longer people are in Congress, the more willing they are to vote government spending.
ROBINSON The polls all show the American people are very concerned about our public schools. What does Milton Friedman think of President Clinton’s proposals to improve those public schools? Hire Learning
ROBINSON President Clinton on public schools. According to the White House fact sheet, he wants to, I quote, “raise standards and increase accountability in public schools (I’ve got to take a deep breath to get through this) through proposals to end social promotion, bring high-quality teachers into the classroom, intervene in failing schools, provide school report cards to parents, strengthen our commitment to smaller class-sizes, and boost our efforts for school modernization.” What grade do you give that proposal?
FRIEDMAN F.
ROBINSON F.
FRIEDMAN What does it mean? It means more government control of schools. What do we really need in schools? We need competition. What we have is a monopoly, and like every monopoly, it’s producing a low-quality product at a very high cost. The way to improve that is to have competition, to make it possible for parents to have a choice of the schools their children attend. All high-income people have that choice now. They can choose their residence for a place with good schools, or they can send their children to private schools, pay twice for schooling: once in taxes and once in tuition. But the lower income classes can’t.
ROBINSON They’re stuck. Milton, didn’t public schools used to work?
FRIEDMAN Yes. When I graduated from high-school in 1928, there were 150,000 school districts in this country. Today, there are 15,000 and the population is twice as great. In the early day, you had local control of schools, and there was effective competition between a large number of local areas. But school districts got consolidated. They got run not by local people but by the professional educators. And most important of all, in the 1960s you began to have the emergence of teachers’ unions taking control of the schools. And since 1960, since the teachers’ unions started emerging, you have had on the whole a rather steady decline in the quality of schooling. If you want to improve automobiles, do you have government step in and tell people what brakes to put on, and so on, or do you rely on the fact that General Motors is going to try to beat Ford, is going to try to beat Toyota? Competition is the most effective way to improve quality, whether in computers, in automobiles, in suits, or in schooling.
ROBINSON Let me ask you to close, if I may, with a prediction. It’s 2009, ten years from today. Is the government of the United States bigger, or smaller?
FRIEDMAN Smaller.
ROBINSON Your ideas are winning?
FRIEDMAN No. The Internet is going to make it harder and harder to collect taxes.
ROBINSON How come?
FRIEDMAN Because you’ll be able to evade taxes, you’ll be able to do your deals in the Cayman Islands.
ROBINSON So the Internet…
FRIEDMAN At the moment I see the Internet as the most likely source of the smaller government.
ROBINSON But in your mind it really will have an effect. That’s not speculative…
FRIEDMAN No, no, no. I believe it will and I believe it’s having it now.
ROBINSON I see. Okay. Milton Friedman— Bill Clinton I hope you’re taking notes, we’ll send a tape of this to the White House— Milton Friedman, thank you very much.
FRIEDMAN That’s all-right. I assure you they won’t look at it. Thank you.
ROBINSON Doctor Friedman believes the government should be smaller and that it will become so. Maybe some future President will preside over such a small government that he can shrink up the State of the Union Address enough to get rid of the Teleprompter and deliver the speech from memory. I’m Peter Robinson. Thanks for joining us.
In 1977, when I reached the age of 65, I retired from teaching at the University of Chicago. At the invitation of Glenn Campbell, Director of the Hoover Institution at Stanford University, I shifted my scholarly work to Hoover where I remain a Senior Research Fellow. We moved to San Francisco, purchasing an apartment in a high-rise apartment building in which we still reside. The transition of my scholarly activities from Chicago to California was greatly eased by the willingness of Gloria Valentine, my assistant at Chicago, to accompany us west. She remains my indispensable assistant.
Hoover has provided excellent facilities for scholarly work. It enabled me to remain productive and an active member of a lively scholarly community.
Initially we continued to spend spring and summer quarters at Capitaf, our second home in Vermont. However, we soon came to appreciate the inconvenience of maintaining homes a continent apart and began to look in California for a replacement for Capitaf. In 1979, we purchased a house on the ocean in Sea Ranch, a lovely community 110 miles north of San Francisco. In 1981, we disposed of Capitaf and began to spend about half the year at Sea Ranch at intervals of a week or so, spread throughout the year, rather than in one solid block. It proved a fine locale for scholarly work. The Internet plus an assistant at Hoover more than made up for the absence of a library near at hand.
After more than two wonderful decades at Sea Ranch, we sold our house to simplify our lives. We now have one home, our apartment in San Francisco.
To return to the 1970s, not long after we arrived in California, Bob Chitester persuaded us to join him in producing a major television program presenting my economic and social philosophy. The resulting effort, spread over three years, proved the most exciting adventure of our lives. The end result was Free to Choose, ten one-hour programs, each consisting of a half-hour documentary and a half-hour discussion. The first of the ten programs appeared on PBS (Public Broadcasting System) in January 1980. Since then, the series has been shown in many foreign countries.
When we agreed to undertake the project, little did Rose and I realize what was involved in producing a major TV series. As a first step, I gave a series of fifteen lectures over a period of nine months at a wide variety of locations. The lectures and question-and-answer sessions were all videotaped to provide the producers with a basis for planning the programs.
The filming began in March 1978 and continued for the next eight months at locations in the United States and around the world, including Hong Kong, Japan, India, Greece, Germany, and the United Kingdom – in the process generating more than six miles of video and audiotape.
Three months after the end of filming, we returned to London to view the documentaries that Michael Latham, our wonderful producer, and his associates had created from that tape and to dub the voice-overs. Another six months passed before we gathered again in Chicago where we filmed the discussion sessions – one of the most stressful weeks I have ever experienced.
One distinguishing feature of the series was that there was no written script. I talked extemporaneously from notes. When we returned to Capitaf from London with the transcripts of the final documentaries, we set to work to convert them to a book to appear simultaneously with the TV program. The book, Free to Choose (Harcourt Brace Jovanovich, 1980) was the bestseller nonfiction book of 1980 and continues to sell well. It has been translated into more than fourteen foreign languages.
As Rose wrote in our memoirs, “As we look back at the events chronicled in this chapter, it all seems like something of a fairy tale. Who would have dreamed that after retiring from teaching, Milton would be able to preach the doctrine of human freedom to many millions of people in countries around the globe through television, millions more through our book based on the television program, and countless others through videocassettes” (p. 503).
Monetary Trends in the United States and the United Kingdom, published in 1982, was the final major product of a collaboration with Anna J. Schwartz under the auspices of the National Bureau of Economic Research that lasted more than three decades. Money Mischief (Harcourt Brace Jovanovich, 1992) collects assorted pieces of monetary history, some of which I had published elsewhere, some of which appear first in this book.
I have continued to be active in public policy since 1977. I continued my tri-weekly column in Newsweek until it was terminated in 1983. Since then, I have published numerous op-eds in major newspapers. I served as an unofficial adviser to Ronald Reagan during his candidacy for the presidency in 1980, and as a member of the President’s Economic Policy Advisory Board during his presidency. In 1988, President Reagan awarded me the Presidential Medal of Freedom and in the same year I was awarded the National Medal of Science.
We have traveled extensively since 1977, including a trip through Eastern Europe in 1990, where we filmed a documentary on former Soviet satellites. The documentary was included in a shortened reissue of Free to Choose.
Perhaps the most notable foreign travel consisted of three trips to China: one in 1980 when I gave a series of lectures under the auspices of the Chinese government; one in 1988 when I attended a conference in Shanghai on Chinese economic development and had a fascinating session in Beijing with Zhao Ziyang, at the time, the General Secretary of the Communist Party, deposed a few months later for his unwillingness to approve the use of force on Tiananmen Square; and one in 1993 when I traveled with a group of Chinese friends from Hong Kong throughout the country. The three visits covered a period of revolutionary economic growth and development, the first stage of a shift from an authoritarian, centrally planned economy to a largely free market economy.
Ever since the 1950s, Rose and I have been interested in the promotion of parental choice in schooling through the use of vouchers. Finally, in 1996, when it became clear that our personal involvement would have to be limited, we established a foundation, The Milton and Rose D. Friedman Foundation devoted to promoting parental choice in schooling. We were fortunate in being able to persuade Gordon St. Angelo to serve as president. He has done an outstanding job. Progress toward our objective of universal vouchers has been distressingly slow, but there has been progress. The pace of progress shows every sign of speeding up, and our foundation has made a significant contribution to that progress.
In 1998, the University of Chicago Press published our memoirs, Milton and Rose D. Friedman, Two Lucky People.
I was at the New Orleans Investment Conference when I learned that free-market economist extraordinaire Milton Friedman, died on November 16. He was a dear friend. I was probably the last person to go out to lunch with Milton. We met at his favorite restaurant in San Francisco, where I showed him a picture of him standing next to John Kenneth Galbraith, the premier Keynesian and welfare statist of the 20th century. Galbraith towered over the diminutive Friedman. Beneath the picture was a funny line by George Stigler: “All great economists are tall. There are two exceptions: John Kenneth Galbraith and Milton Friedman.” Milton was so pleased with the photo and caption that he sent it to all his friends only two weeks before his passing.
“All great economists are tall. There are two exceptions: John Kenneth Galbraith and Milton Friedman.” –George J. Stigler
George Stigler, Milton Friedman and John Kenneth Galbraith
(Left to right: George Stigler, Milton Friedman, John Kenneth Galbraith.
Creation of Mark Skousen. Technical assistance by James Durham.)
Milton had just turned 94, yet his mind was sharp. We discussed the latest Nobel Prize in economics. He said, “We’re running out of good names.” What about the new field of behavior economics that Richard Thaler (Chicago), Robert Shiller (Yale), and Jeremy Siegel (Wharton)? “Yes,” he agreed. “They are making an important contribution. Siegel worked with me at Chicago in the 1970s and is doing brilliant work.”
I asked Milton if he wouldn’t mind giving me a blurb for my next book, “The Big Three in Economics.” He loved my previous history, “The Making of Modern Economics,” and agreed to give me a quote. It saddens me to know he never got to it.
For the past few years, he walked with a cane. He suffered from pain in his legs, a weak heart (after two heart surgeries in the 1980s), and was losing his eye sight. As we left, I asked him, “Do you think you’ll live to be 100?” He answered quickly, “I hope not!”
A few days later he fell and was taken to the hospital. He died a couple weeks later of a heart attack.
Friedman was not only a great economist, but a memorable quotesmith. Besides the standard bearers, such as “Inflation is always and everywhere a monetary phenomenon” and “There’s no such thing as a free lunch,” here are some others less well known:
“Competition is a tough weed, but freedom is a rare and delicate flower.” — (with George J. Stigler)
“If a tax cut increases government revenues, you haven’t cut taxes enough.”
“I favor tax reductions under any circumstances, for any excuse, for any reason, at any time.”
“A society that puts equality ahead of freedom will end up with neither equality or freedom.”
“Nothing is so permanent as a temporary government program.”
“Inflation is taxation without legislation.”
“The economy and the stock market are two different things.”
“If government is to exercise power, better in the county than in the state, better in the state than in Washington.”
“The great advances of civilization, whether in architecture or painting, in science or in literature, in industry or agriculture, have never come from centralized government.”
“The minimum wage law is one of the most, if not the most, anti-black laws on the statute books.”
“Nobody spends somebody else’s money as carefully as he spends his own.”
“The government solution to a problem is usually as bad as the problem.”
I will miss our lunches and dinners together. He was one of the most unforgettable people I ever met.
In liberty, AEIOU, Mark
P. S. At our luncheon last month, Milton Friedman and I also talked about the upcoming FreedomFest. He was a big fan and was looking forward to it. He wrote me this statement to all freedom lovers: “FreedomFest is a great place to talk, argue, listen, celebrate the triumphs of liberty, assess the dangers to liberty, and provide that eternal vigilance that is the price of liberty. We have so much to celebrate but also much to be concerned about.” We are going to have a special tribute to Milton Friedman at FreedomFest 2007, set for July 5-7, 2007, at Bally’s in Las Vegas. For more information, go to www.freedomfest.com.
The Daily Hatch 