“I would like to say to Milton and Anna [co-author of A Monetary History of the United States, 1867–1960]: Regarding the Great Depression. You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again.”
Milton Friedman is the Godfather of American conservative libertarianism. He was, at a time when it was deeply unfashionable in official circles, a fierce critic of Keynesian economics. He was a leader of the second generation of libertarian economists to come out of the University of Chicago. Among the people recruited or mentored by him at the university include Thomas Sowell, Gary Becker, Robert Fogel and Robert Lucas, Jr. Friedman often used the jargon and methodology of Keynesians while rejecting their basic premises, coming to very different conclusions than his Keynesian counterparts.
One of his groundbreaking theoretical innovations is the notion of a natural rate of unemployment. Friedman believed that when the unemployment rate was too low, inflation was the result. Using this and his unique interpretation of the Phillips Curve, Friedman predicted “stagflation” long before there was even a word for such things. Friedman likewise broke with Austrian orthodoxy in advocating for small, controlled expansions of the money supply as the proper monetary policy. This became known as “monetarism” – the theory leveraged by the Federal Reserve during the 2008 financial crisis.
As an advisor to both United States President Ronald Reagan and United Kingdom Prime Minister Margaret Thatcher, it can be said that, in some ways, Milton Friedman was the forerunner of neoliberal economics on the international scale.
Friedman’s Path to Economics
Friedman came from humble beginnings, the son of two Jewish immigrants from an area of the Kingdom of Hungary currently located in Ukraine. His family soon moved to New Jersey. And at 16, he won a scholarship to Rutgers University, where he studied mathematics and economics with an eye toward becoming an actuary. He was offered two different scholarships: One to Brown University to study math, the other to the University of Chicago to study economics. He opted for the latter. It is here that he met his future wife, Rose Director, also an economist.
He was unable to find work in academia, so he and his wife moved to Washington, D.C., to work as economists for President Franklin Delano Roosevelt. He actually believed in many of the programs designed toward job creation and infrastructure development (such as the Works Progress Administration, the Civilian Conservation Corps and the Public Works Administration) while opposing those programs which regulated and controlled wages and prices. Indeed, an opposition to wage and price control can be considered the central core of Friedman’s opposition to government intervention.
Later on, Friedman declared that he believed all government intervention to end the New Deal was wrong, not on the basis of moral reasons, but because it simply did not lead to the recovery the nation needed. He called it “the wrong cure for the wrong disease.” Later, in A Monetary History of the United States, 1867–1960, a book he co-authored with Anna Schwartz, he argued that the Depression was caused by a severe constriction of the money supply and unwise policy on the part of the Federal Reserve. In fact, subsequent Fed Chairman Ben Bernanke agreed with Friedman, saying in 2002: “I would like to say to Milton and Anna: Regarding the Great Depression. You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again.”
In 1940, Friedman finally got the academic position that had eluded him for so long. The University of Wisconsin-Madison hired him as an assistant professor of economics. However, he left either due to antisemitism or competing ideas about the coming war, and re-entered government service. He worked for the United States Department of the Treasury, where he was responsible for, among other things, the income tax withholding scheme that has you paying your income tax as you go rather than writing one big check per year.
He supported the United States war effort during World War II as a mathematical weapons statistician. When the war was over, he received his doctorate from Columbia University. He then accepted his position at the University of Chicago, a position he would keep for the next 30 years. He was the intellectual godfather of a group of economics academics and intellectuals known as the Chicago School, many of whom would receive Nobel Prizes over the years.
Capitalism and Freedom
Capitalism and Freedom is the book that eventually brought him popular acclaim. Published by the University of Chicago in 1962, it has sold over half a million copies and has been translated into 18 different languages, no small feat for a popular book on the subject of economics. In the book, he argues for a classically liberal society where free markets solve problems of efficiency, using the United States as an example. He argues for free markets on the basis of both pragmatism and philosophy. He concludes the book with an argument that most of America’s successes are due to the free market and private enterprise, while most of its greatest failures are due to government intervention.
The book was a touchstone for the conservative movement in the United States. He supported the campaign of Senator Barry Goldwater in 1964, and was later an advisor to President Ronald Reagan, whose own political career was inspired by Goldwater. He received the Presidential Medal of Freedom and the Medal of Science from Ronald Reagan as he was preparing to leave office in 1988. Friedman claimed that he was a libertarian with a small “l” but a Republican out of expediency. He labeled his own views “classical liberalism,” while at the same time declaring that it didn’t matter what people called him.
Friedman believed that Social Security benefits were the genesis of the welfare state and dependency on government handouts. He advocated the replacement of all welfare programs in America with a negative income tax (effectively a universal basic income) because he did not believe that society would distribute resources evenly enough for all people to earn a living.
Friedman was an idiosyncratic figure who would be hard to pigeonhole in the current political spectrum. He inspired the conservative movement, but was against any discrimination against gay people, in addition to being an agnostic. He was a libertarian who advocated for a progressive income tax system that even went into the negative to ensure that everyone could, at the very least, meet their basic needs.
Perhaps that is what makes him such a hero. Rather than resorting to rote ideological responses to the issues of his life, Friedman instead chose to think about them flexibly and novelly. This is a precedent set during his acceptance of some Great Depression relief programs (but not others), which followed him throughout his life. We should all be so creative in our thoughts.
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Friedman also applauded Nixon’s catastrophic decision to default and go off the gold standard….
The Federal Reserve caused the problem, not Nixon. Nixon acted prudently.
Nixon, Kissinger and a huge number of White House politicians of both parties (the Jackass and the Elephant with no memory) were member/puppets of the CFR and the dominant CFR Puppet Masters since the 50’s (formed in 1921) was/is the Rockefellers.
Who knows exactly (sure we can guess) who controls the FED…never been audited?
The shareholders of our currancy masters will not be ahhhh…exposed.
Unless someone knows?
The BIS?
Then who own them?
Not being smart just wondering?
The Fed is effectively controlled by the member banks.
Who controls the member banks is then the interesting question.
This is the same Milton Friedman” who came up with the idea of “withholding” income taxes from paychecks on a regular basis. This one move “hid” taxes as one was no longer required to come up with the yearly balance on April 15…
It’s worse than that. The employer has to pay half of payroll taxes, we don’t even see that at all. Why the hell would they ever do that? Why the hell do employers even mess with medical insurance? They should be prohibited by law from offering it as a benefit. Employers should compensate with CASH and CASH only. Our healthcare system wouldn’t be half as bloated as it is right now. We should all be paying our own healthcare, so we can all see for ourselves how much it truly costs, and be far far more motivated to make the necessary lifestyle changes to lower those costs. What we have now is blatantly absurd.
You are correct. Most people are unaware that their employers pay a like amount into social security-something the employee never sees.
As to health insurance, it was offered as a benefit during WW2 in lieu of higher wages. There were wage controls in place during WW2.
“You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again.”
then he proceeds to blow a bubble so big and nasty that it dwarfs 1929 by so many orders of magnitude that you can’t even compare the two, and there is every indication that they are just getting started. If they indeed cut rates with markets at all time highs, this will be the dawn of a new era of money printing and middle class/working class destruction. You think it is bad to be paying $10k in insurance premiums with total $20K annual out of pocket medical expenses before the actual real insurance coverage begins? You think $30K for a new vehicle is bad? You think $50K a year for college is bad? You think $400K for a 1200 sq foot home on a 1/3 acre lot is bad? This is just the frickin beginning.
The article says “He worked for the United States Department of the Treasury, where he was responsible for, among other things, the income tax withholding scheme that has you paying your income tax as you go rather than writing one big check per year.”
What a load of shit. He has the employer paying your income tax, not you the employee. It is one more burden on the employer.
It was because, for sure and certain, it allowed the government to collect the tax a year earlier than previously – a massive windfall of revenue.
“Before the 1940s, taxpayers who owed federal income taxes paid them the following year, in quarterly installments. The financial burdens of World War II forced the government to raise more revenue, more frequently, throughout the year. As the federal budget rose tenfold during the war, from $9 billion in 1940 to $98 billion in 1945, Congress passed a law called the Current Tax Payment Act in 1943 to solve this problem.” Solve the problem? There you go folks – the tax escalations began because of war. And further massive escalations took place because of welfare.
Eliminate welfare, and eliminate the massive overspend on military, and taxes could be say 1/4 of what they currently are. Go figure.
Who wrote this article? Friedman supported the Federal Reserve system, FFS. This alone disqualifies him from the libertarian camp. He supported American involvement in WW 2, which had nothing to do with White America’s legitimate self-defense. This disqualifies him from the classical liberal camp, contrary to the article’s theme.
He supported the alliance of the jew communist-infested Roosevelt administration with the financier jew-controlled Churchill and the judaic bolsheviks to destroy the German people. This makes him yet another over-rated jewish intellectual hell-bent on subverting White America and enabling, as Francis Parker Yockey wrote, the jewish conquest of Western and Eastern Europe.
Some guy named Alex according to this.
https://freenorthcarolina.blogspot.com/2019/07/milton-friedman-forgotten-history-of.html
Don’t know who Alex might be.
Fuck Milton,as reported previously this turd helped usher in the Withholding Tax.
I hope his bald head is being beaten against a rock everyday .