Rodney Hide on Milton Friedman

ACT Leader Rodney Hide has paid tribute to Nobel Prize-winning economist Milton Friedman, who passed away last night, aged 94.

Milton Friedman was a tireless advocate of free market economics, individual choice and personal responsibility“, Mr Hide said.

After winning the Nobel Prize for economics in 1976, Milton and his wife Rose produced a television series which became the bestselling book ‘Free To Choose’, laying out how free markets work.

“In 2003, Milton and Rose praised the reforms of Sir Roger Douglas when addressing ACT’s Annual Conference by video link, also endorsing ACT’s support for free trade and less government.

“Milton Friedman never gave up his optimism, or his belief that independence from government was the key to prosperity and freedom.

“My sympathies are with Rose and his colleagues at the Milton and Rose D. Friedman Foundation, which they established to advocate school choice“, Mr Hide said.

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4 thoughts on “Rodney Hide on Milton Friedman

  1. Yeah individual choice, just like what people in Chile under Pinochet enjoyed. Friedman called what was happening there during those dark years “the miracle of Chile”.

  2. Legendary Nobel economist Milton Friedman dies

    November 17, 2006 08:14 RTE

    Nobel prize-winning economist Milton Friedman, whose ideas helped power a conservative policy revolution in the 1980s, died yesterday at the age of 94. Friedman died of heart failure in San Francisco, California, near Stanford University where he taught most recently.

    He won the Nobel prize for economics in 1976 and his thinking greatly influenced former US president Ronald Reagan and ex-British prime minister Margaret Thatcher.

    President George W Bush said the US had ‘lost one of its greatest citizens’. ‘Milton Friedman was a revolutionary thinker and extraordinary economist whose work helped advance human dignity and human freedom,’ he said.

    Friedman’s views were shaped by the Great Depression. In his writings, he blamed the Federal Reserve for choking off the money supply and so turning what could have been a passing recession into a ‘major catastrophe’ for the world.

    That view has held sway with successive Fed chairmen since, including incumbent chief Ben Bernanke, who said he would be ‘sorely missed’.

    ‘The direct and indirect influences of his thinking on contemporary monetary economics would be difficult to overstate,’ Bernanke said. Friedman ‘conveyed to millions an understanding of the economic benefits of free, competitive markets, as well as the close connection that economic freedoms bear to other types of liberty’, he added.

    Friedman’s ‘monetarist’ theories emphasised that government should get out of the way, and strive only to control the supply of money and so keep a lid on inflation, which he saw as the greatest economic danger.

    From 1946 to 1976 Friedman taught economics at the University of Chicago, pioneering the ‘Chicago School’ of free-market thinking, and remained a professor emeritus there. The economist, who coined the phrase ‘There’s no such thing as a free lunch’, was also a senior advisor at the Cato Institute, a libertarian think-tank in Washington.

    ‘In my view he was the greatest champion of human liberty in my lifetime, certainly in the 20th century. And he didn’t slack off in the 21st century,’ Cato president Edward Crane said.

    Friedman’s work was often contrasted with UK economist John Maynard Keynes, whose belief in the necessity for governments to intervene in times of economic strife long dominated policy thinking.

    Rejecting the Keynesian model, both Thatcher and Reagan used the Friedman school to help inform their vision of small government, deregulation and privatisation.

    Friedman was born on July 31, 1912 in New York, the youngest of four children to Jewish immigrants from what is now Ukraine. In the 1930s, he worked odd jobs to pay his way through Rutgers University, before attending the University of Chicago and winning a doctorate in 1946 from Columbia University.

    A prolific writer, his books included ‘Capitalism and Freedom’ and, co-written with his wife Rose, ‘Free to Choose’ and ‘Tyranny of the Status Quo’.

  3. Milton Friedman’s legacy of free market madness

    Chris Harman looks at the career of the monetarist economist who died last week

    The evil that men do lives after them. Such is the legacy of the economist Milton Friedman, who died last week at the age of 94.

    If you are to believe the paid apologists of capitalism – whether of the conservative, liberal or New Labour variety – Friedman was a great man.

    The Guardian’s obituary described him as “one of the greatest economists of all time, to be included in the same category of pre-eminent figures as Adam Smith, David Ricardo, Karl Marx and John Maynard Keynes”.

    That anyone should bracket Friedman with such figures is almost beyond belief. Adam Smith’s writings were a pioneering attempt to understand the peculiarities of a new economic system that was beginning to emerge in Britain some 230 years ago – industrial capitalism.

    Smith saw it was the labour of those who worked that increased society’s wealth – and that profit was a “deduction” from that labour.

    Ricardo carried Smith’s analysis forward. He too recognised that the market system led to increased wealth for capitalists, but increased unemployment and poverty for workers.

    Keynes came to prominence in the great economic crisis of the 1930s. He too saw that capitalism can create crises which wreak havoc with people’s lives.

    Friedman, in contrast, was an uncritical apologist for the horrors of capitalism. He supported the “neoclassical” economic theory that had turned its back on many of the insights of Smith and Ricardo.

    Neoclassical theory held that the economy would always run smoothly – providing that capitalists were freed from “interference” by the state, and from “unnatural monopolies” such as trade unions.

    This theory was very convenient for academics whose careers depended on ingratiating themselves with the powers that be. It reigned supreme in universities for more than half a century.

    But then came the great crisis of the 1930s, with massive piles of unsold goods, hundreds of banks going bust and a third of the population unemployed in the US and Germany.

    The complete unreality of the old orthodoxy became apparent, not only to those suffering from the slump, but also to capitalists looking to the state to protect them from bankruptcy.

    Keynes argued that the state had to intervene to prevent capitalism from destroying itself. This approach became the new orthodoxy, accepted by Tory and Labour leaders alike for three decades after the Second World War.

    Economists such as Friedman, who held on to the old views, were marginal figures, almost a laughing stock to most of their profession.

    But crisis suddenly hit world capitalism again in the years between 1973 and 1976, and from 1980 to 1982. Governments tried to apply the remedies proposed by Keynes – and found they did not work.

    Friedman suddenly became a significant figure. He preached that capitalism had to be “freed” from state interference. The rich had be given free rein to get richer. There had to be an end to attempts to keep unemployment down.

    It was a popular message for economists. They had blamed the slump of the 1930s on a lack of state intervention. Now they blamed the new crises on such intervention.

    Friedman’s ideas were first put into practice in Chile in 1973, after a brutal military coup led by General Pinochet that killed thousands of people and destroyed the working class movement.

    Money

    The experiment ended in disaster, with the country’s major banks going bust eight years later. But this did not stop Margaret Thatcher from implementing Friedman’s ideas in Britain in the 1980s.

    Friedman claimed to develop two new economic theories. The first was that if things went wrong with the capitalist economy, it was because the government did not know how to control the supply of money.

    But this “monetarist” theory was neither new – Karl Marx had already torn it apart in the third volume of Capital a century before – nor could it be applied in practice. Governments found they could not control the money supply, and economists bickered over how one could even measure it.

    Friedman’s second “innovation” was to argue that government attempts to reduce unemployment could not work because there was a “natural rate of unemployment”.

    Without realising it, Friedman was simply reiterating an old truth about capitalism – that it needed what Marx called a “reserve army” of the unemployed to keep wages down.

    But Friedman’s theoretical inadequacy did not matter – he provided an ideological justification for attacks on workers. That is why apologists for capitalism are extolling Friedman. The rest of us should spit on his grave.

  4. " Friedman was responsible for providing the academic cover for “Thatcherism” and “Reagonomics” of the eighties which rapidly accelerated the shift in wealth from the general populace, including the sale of publicly owned utilities, to the already very wealthy.

    The Chicago School was, in fact, the economics department at the University of Chicago which Friedman headed. Now here's the sting – the University of Chicago was established with Rockefeller money and, by all things observable, still controls it. Another example is that “The Economist” magazine in England is largely owned and controlled by the Rothschilds. These people have interests diametrically opposed to the rest of us. It is vital to their interests that they control economics education so as to distort it to justify their position as essential to society and generally mislead everybody."

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