Happy Birthday Milton Friedman!

I can’t believe how excited I am. I just received a copy of Arthur Brooks new book entitled “The Road to Freedom: How to Win the Fight for Free Enterprise.” I am becoming a huge proponent of his philosophy, and the importance of free enterprise in this age of statism and cronyism. I have just cracked the book, so I am sure more information will be coming. First, I’d like to say happy birthday to an economist that would have been 100 years old today, if he were still alive.

I did not realize that Milton Friedman’s birthday is today. We discussed him in my Business Ethics class last night. His famous comment about Business Ethics is debated around the world. It is probably one of the few concepts of his that I disagree with. However, there is so much more to his economic philosophy.

Thomas Sowell wrote about Friedman today in his column. First, I did not realize my favorite Libertarian author was once a Marxist. Friedman did not convert Sowell to a conservative view of the economy, it was working for the government that did. Thus, Sowell believes that Friedman’s economic theory is needed today more than ever.

Stephen Moore discussed Friedman in today’s WSJ in an article entitled “The Man Who Saved Capitalism.” Moore starts the article with, “It’s a tragedy that Milton Friedman – born 100 years ago on July 31st – did not live long enough to combat the big-government ideas that have formed the core of Obamanomics. Its perhaps more tragic that our current president, who attended the University of Chicago where Friedman taught for decades, never fell under the influence of the world’s greatest champion of the free market.” Strong words, but definitely caught my interest.

What can we learn from Friedman? First, the reality of no free lunch. The increased government spending and the printing of money must be paid for. “If the government spends a dollar, that dollar has to come from producers and workers in the private economy. There is no multiplier effect by taking from productive Peter and giving to unproductive Paul.” The fact that we print more money only gives us a feeling that we are wealthy. It is very similar to increased stock value represented in the Dow. It is not real value in our pockets, but we feel wealthier, which means we spend more.

Second, thinking that centrally planned economies are efficient is fallacious. It is a free enterprise system that is the most efficient. Friedman would be appalled with our little country tax system and big country spending process. This process leads us to think that big government is our savior.

Third, be careful what you wish for when it comes to the state. “Friedman stood unfailingly and heroically for the little guy against the state. He used to marvel that the intellectual left, which claims to espouse power to the people, so often cheers as the state suppresses individual rights.” What I especially like about this guy was his ability to attack the pork of both political parties.

Last, Friedman was against high taxes because of the government’s ability to spend. “Higher taxes never reduce the deficit. Governments spend whatever they take in and then whatever they can get away with.” Does that sound familiar? Remember the term used is government, not Democrats. Thanks Milton for being a thinker, and challenging us to stop drinking the Koolaid.

And that is my thought for the day!

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