Remember the great Milton Friedman
Saturday marks the 109th anniversary of the birth of economist Milton Friedman, one of history’s most consequential free-market advocates. Heeding the work of Mr. Friedman — and his wife and collaborator, Rose — this year, in particular, reminds us of how much more sound and sustainable the nation’s economic policies could be.
What made Mr. Friedman unique not only was his grasp of economics, but also his ability to simply explain complex ideas. He opined, for example, that “the most important single central fact about a free market is that no exchange takes place unless both parties benefit.”
Today, the national debate and an ongoing theme in the presidential election is the insistence of President Joe Biden and his allies on raising income taxes on higher-income Americans.
Here is what Mr. Friedman, who died in 2006, said about such notions:
“There is all the difference in the world, however, between two kinds of assistance through government that seem superficially similar: First, 90% of us agreeing to impose taxes on ourselves in order to help the bottom 10%, and second, 80% voting to impose taxes on the top 10% to help the bottom 10%.”
“The first may be wise or unwise, an effective or ineffective way to help the disadvantaged – but it is consistent with belief in both equality of opportunity and liberty.
The second seeks equality of outcome and is entirely antithetical to liberty,” he said.
We couldn’t have said it better ourselves.
What Milton Friedman understood better than most was that individuals, with private interests and expertise, were best able to advance society. “Nobody spends somebody else’s money as carefully as he spends his own,” he said. “Nobody uses somebody else’s resources as carefully as he uses his own. So if you want efficiency and effectiveness, if you want knowledge to be properly utilized, you have to do it through the means of private property.”
While others of his time advocated for redistribution and central planning of sorts, Mr. Friedman argued competition would be the catalyst for success. Later in life, he would even apply the concept to his ideas for education reform. “Our goal is to have a system in which every family in the U.S. will be able to choose for itself the school to which its children go,” Mr. Friedman said. “We are far from that ultimate result. If we had that system of free choice we would also have a system of competition, innovation, which would change the character of education.”
Mr. Friedman’s ideas transcend a generation and he laid a theoretical framework that should be used today as an intellectual defense for many of the unwise policies being advocated in Washington and elsewhere.