by Frank Li
Milton Friedman was arguably the most influential and controversial American economist. As a self-proclaimed disciple of Adam Smith and Thomas Jefferson, he “religiously” preached for freedoms and individualism, especially later in his life. In this post, I will briefly assess his works, with a clear conclusion that Dr. Friedman is mostly a man of the past.
1. Who is Milton Friedman?
Below is an excerpt from Wikipedia - Milton Friedman.
Milton Friedman (/ˈfriːdmən/; July 31, 1912 - November 16, 2006) was an American economist who received the 1976 Nobel Memorial Prize in Economic Sciences for his research on consumption analysis, monetaryhistory and theory, and the complexity of stabilization policy.[4] With George Stigler and others, Friedman was among the intellectual leaders of the second generation of Chicago price theory, a methodological movement at the University of Chicago's Department of Economics, Law School, and Graduate School of Business from the 1940s onward. Several students and young professors who were recruited or mentored by Friedman at Chicago went on to become leading economists; they include Gary Becker, Robert Fogel, Thomas Sowell,[5] and Robert Lucas Jr.[6]
2. Friedman's most famous book: "Free to Choose"
Below is an excerpt from Wikipedia - Free to Choose.
Free to Choose: A Personal Statement (1980) is a book and a ten-part television series broadcast on public television by economists Milton and Rose D. Friedman that advocates free market principles. It was primarily a response to an earlier landmark book and television series: The Age of Uncertainty, by the noted economist John Kenneth Galbraith. Milton Friedman won the Nobel Memorial Prize in Economics in 1976.
3. "Free to Choose" on YouTube
Below is Part 1 of the 10-part video series.
4. My assessment
Here is a highlight:
Friedman was a Libertarian.
Friedman was a man of his time.
Friedman is a man of the past.
Let me elaborate on each ...
4.1 Friedman was a Libertarian
What is a typical Libertarian today? He (or she) is unhappy about the present, especially the 2-party political system; he is nostalgic about the past; and he has no idea about the future. So, what does he do? Reciting some slogans from the past, especially those by the Founding Fathers, such as "freedom" and "equality"!
Friedman not only was a self-proclaimed Libertarian (often publicly criticized Ralph Nader though), but also sounded like a typical Libertarian, with one major exception: he was armed with a Nobel Prize!
4.2 Friedman was a man of his time
Friedman was very critical of the America in his time, especially the government. Here is a summary:
Symptom: His observations were mostly correct, even to this day. One example: The Tyranny of the Status Quo.
Diagnosis: His was only half correct, as he simply blamed the government, most of the time.
Solution: His was mostly wrong, if not absurd, as he was religious about freedoms and individualism, without a profound understanding of societal complexity, history, or even humanity.
To justify his arguments, Friedman used some well-selected foreign examples to "fool" his mostly American audience. Two highlights:
Britain: Many examples he used were directly refuted by the U.K. Ambassador to the U.S. at the time, as shown in the 10-part video series cited above.
Asia: The examples he used (e.g. Japan, Singapore, and Hong Kong) were very misleading. For instance, comparing Hong Kong with China in capitalism is like comparing ancient Athens with America in democracy - Scaling makes both comparisons invalid, totally!
In short, Friedman first overbought from Adam Smith (e.g. "free market" and "free trade") and Thomas Jefferson (e.g. "That government is best which governs least.") and then oversold them!
Bottom line: For anything built to last, a builder must see beyond his (or her) time. Friedman failed to do that, largely because he was totally soaked in America’s temporary success. As a result, he is now mostly a man of the past!
4.3 Friedman is a man of the past
The dramatic rise of China over the past four decades has changed [almost] everything (History 2.0), turning at least one of Friedman's strongest convictions into a myth, if not falsehood:
The conviction: Capitalism is good, but socialism (e.g. central planning) is bad.The [new] myth: China has both. A well-governed country must have both, with the challenge being to balance between the two, not the extreme of having one without the other. For more, read: What is China’s State Capitalism, Anyway?
More broadly, here is a bigger example to show how China’s rise has turned the world upside down, including almost everything Friedman preached:
The conviction: If there is no religion, where does the moral code come from?
The [new] myth: There has never been a real organized religion in China. Yet, China has proven to be arguably the greatest country in human history. Did the Chinese achieve it without any moral code? For more, read: There is No God - Not in China, Nor Elsewhere!
In short, few of Friedman's solutions are even worth debating today, given China's rise!
5. Discussion
Time is the best judge for everything, including Milton Friedman.
Specifically, Friedman, as a man, was a big American successful story. However, like most Libertarians, he complained a lot and aroused his audience, but offered few real solutions, if any at all.
Why is that?
Two main reasons:
He was boxed in democracy! In other words, Friedman correctly recognized the fact that America was in a steep decline, but failed to recognize its root cause: democracy, as we practice it today! Understandably, there was no alternative to the U.S. model throughout his lifetime for thinking outside-the-box. For more, read: Towards an Ideal Form of Government.
Governance (or government) is very hard. See image below.
Now, what about his Nobel Prize?
It was far better than this one below!
Here is a real book by a modern Libertarian: American Democracy - Why is it failing & how to fix it? Please read and judge for yourself!
Finally, a few words on Friedman's two favorite doctrines: free market and free trade ... Are they for empires only? For instance, was it a coincidence that Adam Smith invented them for the British Empire, while Milton Friedman advocated them for the America Empire? They faded in Britain as the British Empire faded and are now fading in America as the American Empire is fading. Two informative readings:
6. Closing
Milton Friedman religiously preached for freedoms and individualism, without truly understanding the role of government (Towards an Ideal Form of Government)! As a result, his works will soon be, if not already have, proven to be out of date.
In short, Milton Friedman is mostly a man of the past!
Now, please sit back and enjoy the video below.
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