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Selected by the Times Literary Supplement as one of the hundred most influential books since the warHow can we benefit from the promise of government while avoiding the threat it poses to individual freedom? In this classic book Milton Friedman provides the definitive statement of his immensely influential economic philosophy—one in which competitive capitalism serves as both a device for achieving economic freedom and a necessary condition for political freedom The result is an accessible text that has sold well over half a million copies in English has been translated into eighteen languages and shows every sign of becoming and influential as time goes on


10 thoughts on “Capitalism and Freedom

  1. says:

    This book is an interesting case of modern day sophistry – where the worse argument is made to appear the better If one needed proof that much of modern economics is an exercise in ideology and self interested appeals on behalf of the obscenely wealthy then this book provides ample evidence The French Revolution was fought under a flag of three colours and for three causes Liberté égalité fraternité – Freedom Euality and Brotherhood Friedman is only interested in what he refers to as freedom He rails against euality as all liberals in the traditional definition of that term tend to It is hard to imagine anything mean spirited than such a person Naturally this freedom he is so fond of generally euates to a freedom for the majority to have less while the few are given much He says the opposite of course but decades of the applications of his prescriptions have turned America into a grossly and increasingly uneual society Should a theorist be held responsible for the conseuences of their theories? If Marx is to be held responsible for Soviet Russia then Friedman is much responsible for the state of current day America Even the so called ‘left’ – as in the Democrats in the US the Labour Party in Britain and the Labor Party in Australia all look to ‘market based’ solutions to problemsNeo liberals and neo conservatives will complain that Friedman’s ideas have never been fully implemented and that this is why we have so much trouble today – if you ever want to create a utopian vision splendid my suggestion is to follow Plato’s example in the Republic – make the society you envision so impossible to implement that your followers can always claim some vital element has been left out and so never properly applied Here we have a government whose sole role is supplying the police and army – both mostly to protect the interests of property All other government activity even printing money and registering doctors is either fundamentally wrong and needs to be done by the private sector or should be presumed dangerous and in need of constant vigilance I was keen to see what he might say about monopolies – given he appears obsessed with ‘competition’ I thought he might discuss the benefits of anti trust laws for example But how foolish of me The only monopolies he was actually concerned about are those of trade unions Individuals are all that matter while trade unions are an example of ‘collectivism’ and therefore enough to have him fuming and spitting fireIt is remarkable how rarely he supports any of his assertions with anything other than the boldness of his claims One of my favourite examples was towards the end where he discusses the effect of government subsidies in the US on cotton growers overseas – I won’t go into the details of the argument it is even one of the few I would tend to agree with him on but he says “The list of similar cases could be multiplied” Well yes obviously – given that he gave but one example they could hardly be dividedHere is yet another commentator who presents himself as a scientist and his social theories as self evident truths rather than the ideological sophistry they really are I hadn’t realised just how radical this guy was – no wonder he disliked being called a conservative There is little he is seeking to conserve and much he is seeking to overturn


  2. says:

    Live and hopefully LearnBefore reading this book I thought I was a fairly strong proponent of both free markets and limited government TURNS OUTI WAS WRONG Uncle Milt believed down to his very core in the rightness of free markets and after reading his passionate treatise on the benefits of same I find I am not uite as far along the boulevard of laissez faire as I originally thought Despite being under 250 pages this is a dense meaty work designed to summarize the arguments in favor of encouraging free markets and minimal government intervention by raising uestions and presenting ideas formulated over Friedman’s extensive career as a Nobel Prize winning economist Given the number of topics Friedman discusses each one is addressed in “survey” fashion with references to additional works in which the ideas are discussed at greater length That said there is certainly enough detail provided by Friedman to provide a persuasive description of his core values and the merits of the ideas under pinning them While very well written this is certainly not in the category of a pleasure read and it was at times a slog to get through However I found many of the ideas interesting and even when I couldn’t see myself getting to where Friedman wanted me to go I could still understand where he was coming from and he always gave me cause to pause and re evaluate That’s really all I ever ask for in a work like this?One big plus for me and one of the things I do want to praise about this book is its tone Friedman while confidant and passionate about his beliefs is never derogatory or mean spirited towards those who feel differently The uickest way to get me to turn off of any book is to personally attack the other side eg political hit pieces by the likes of Ann Coulter and Al Franken Whenever I hear rabid political trash talk like that my first thought is that the author either is not smart enough to defend their position or their position doesn’t have much of a defense and so they simply foam at the mouth and make loud noises Well Friedman to his credit is respectful and argues issues not people Granted he clearly thinks those that advocate “centralized power” and “big government” are wrong and that their policies are disastrous However he assumes them to be “men of good will” and tries to persuade with the power of his ideas rather than resort to meaningless personal attacks Well done sir Well done As I mentioned above there are 12 Chapters in the book not counting the intro and the conclusion so I thought I would identify and briefly describe each one so you can see the breadth of ideasconcepts Friedman discusses many of which I did not anticipate going in Chapter 1 The Relation between Economic Freedom and Political FreedomOddly enough this was my least favorite chapter in the book and had me off to a kind of meh start with Uncle Milt In it Friedman makes the case that “economic freedom” in addition to be necessary for its own sake is a vital necessary component of “political freedom” He argues that if the government controls the means of production real dissent and the free exchange of ideas are impossible because dissenting groups can’t overcome the government’s ability to withhold the means by which their ideas are disseminated While I find merit in Friedman’s statements this was one of the few instances where he doesn’t provide evidential support for his position and so I didn’t find the case he made very strong Bonus uote from Chapter 1 Political freedom means the absence of coercion of a man by his fellow men The fundamental threat to freedom is power to coerce be it in the hands of a monarch a dictator an oligarchy or a momentary majority The preservation of freedom reuires the elimination of such concentration of power to the fullest possible extent and the dispersal and distribution of whatever power cannot be eliminated a system of checks and balances Chapter 2 The Role of Government in a Free Society This is probably the chapter that would likely feel the most to the casual reader It is a restatement of the foundation of the liberal NOTE that’s the 19th century usage of the term position in favor of limited government Friedman states that government’s role should limited to i establishing and enforcing rules of a level playing field while protecting individual freedom and property rights; ii preventing and if necessary eliminating monopolies as they are coercive and destroy freedom; and iii performing functions necessary to avoid “neighborhood” effects These “neighborhood” effects are instances where the action of one individual eg company dumping toxic waste in river imposes a significant cost on other individuals for which a “voluntary” or “free market” exchangecompensation is not feasible As you can imagine this latter aspect can be very tricky because it becomes a matter of “where do you draw the line” However Friedman to his credit does an excellent job of providing policies that would prevent this from becoming a slippery slope Bonus uote from Chapter 2 Fundamental differences in basic values can seldom if ever be resolved at the ballot box; ultimately they can only be decided though not resolved by conflict The religious and civil wars of history are a bloody testament to this judgment The widespread use of the free market reduces the strain on the social fabric by rendering conformity unnecessary with respect to any activities it encompasses Chapter 3 The Control of Money Here Uncle Milt lays out the case that the Federal Reserve established in 1913 with the best of intentions has done far harm than good Given the most recent economic downturn and the huge government bailout following the banking crisis this idea has gained a lot of traction lately Friedman writing in 1962 uses the Great Depression and the Stock March Crash of 1929 as representative example of how the Federal Reserve and government intervention in the market in the form of the New Deal actually prolonged and exacerbated the country’s financial problems While this chapter was well done it felt like a bit of a rehash for me since I had recently read Meltdown A Free Market Look at Why the Stock Market Collapsed the Economy Tanked and the Government Bailout Will Make Things Worse which goes through a similar analysis in greater detail You can see my review of the book here My review Chapter 4 International Financial and Trade Arrangements Friedman really impressed me with this chapter Written in 1962 Friedman proposes a list of 7 policy directives that he thought should be implemented in regard to currency exchanges and international trade At the time they were proposed they were a plea for floating exchange rates and a complete repudiation of the then existing Bretton Woods system of currency control Well beginning just 9 years later all 7 of Friedman’s policy directives were eventually adopted and today floating exchange rates are the norm throughout most of the world Chapter 5 Fiscal PolicyThis chapter is a pretty scathing rebuke though politely done of the Keynesian position that government spending should be used to eliminate unemployment and “keep the economic engines” humming The Keynesian approach is to view the government as a way to balance or “even out” spending from the private sector In other words as private expenditures fall government spending should rise to offset the drop and when private expenditures rise government spending should be reduced While government has bee great about increasing spending I am less confident in its ability to subseuently reduce those expenditures leading me to agree with Friedman when he says ” Nothing is so permanent as a temporary government programThe philosophy of encouraging government spending is rooted in the belief of the Keynesian “multiplier” effect of government spending This holds or at least held in 1962 that for every 100 in government spending national income would rise by approximately 300 Friedman’s analysis contradicts this theory and I found it well stated and convincing He finishes his argument with the following What we need is not a skillful monetary driver of the economic vehicle continuously turning the steering wheel to adjust to the unexpected irregularities of the route but some means of keeping the monetary passenger who is in the back seat as ballast from occasionally leaning over and giving the steering wheel a jerk that threatens to send the car off the road Chapter 6 The Role of Government in EducationAhvouchers Clearly one of the most divisive words in American politics over the last few election cycles The mere mention of the word is enough to start an expletive laden political cat fight in which of course nothing gets accomplished Well whatever side of the issue you are on it was refreshing to read Friedman’s thoughtful non vitriolic explanation of his position Obviously as a “free market” guy he was strongly in favor of vouchers and his reasons whether you agree or disagree are well stated and create a sound basis for reasonable debate This is one of those areas that I am not sure where exactly I come out but I always appreciate reasoned discourse on the subject I did disagree with at least one aspect of his discussion In discussing the bureaucratic nature of the teaching industry he says With respect to teachers' salaries the major problem is not that they are too low on the averagebut that they are too uniform and rigid Poor teachers are grossly overpaid and good teachers grossly underpaid I think salaries for teachers are not too low on average and I think that is part of the reason it is so tough to find enough good people to take up that profession However this was written back in 1962 and maybe the disparity wasn’t as pronounced then Chapter 7 Capitalism and Discrimination This was one of the most intriguing chapters along with the Chapter 9 on occupational licensure below and yet it is a difficult one to summarize without giving the wrong impression Friedman discusses how he believes the free market should deal with racism and discrimination and opposes consistent with his free market ideals government actions like “fair employment practices” and “right to work laws” because he believes they do harm than good and violate the principles of freedom He compares the reuirement of considering criteria like race color and religion as analogous in principle to the Nuremburg laws enacted by the Nazi’s during World War II He further argues that “As a general rule any minority that counts on specific majority action to defend its interests is short sighted in the extreme” Friedman argues that the correct approach is to persuade our fellow man to be of like mind and win the battle in the marketplace of ideas where all truths eventually find expression if the freedom to express them is protected I didn’t agree with everything that Friedman said and can’t ride along with him completely but I thought he made his case very well and that his arguments were founded on principles of rightness and justice and so provide excellent food for thoughtChapter 8 Monopoly and the Social Responsibility of Business and Labor This is a very dry chapter on the evils of both monopolies and coercive trade unions and that the proper role of government should be to prevent both as they impinge upon the freedom of citizens According to Friedman most monopolies come about as a result of “favorable treatment by government” towards one group he used the railroads as an example and that without government interference or generous handouts monopolies would be for rare Food for thought Chapter 9 Occupational Licensure This is Friedman at his most radical and I found this to be incredibly interesting to read even though I found I could not completely agree with his proposals Friedman begins by laying out the 3 forms of government barrier to practicing in a particular occupation The least restrictive is registration which is simply putting your name on a list For example anyone who wants to sell firearms must be identified on a government list This is purely informational and Friedman did not have a real issue with this because it does not act as a barrier The second level is “certification” which though restrictive is completely voluntary It allows a person practicing in a particular industry to obtain a certification following enhanced training that they can advertise to their customers This would include the CPA certification for accountants Again Friedman with some reservations is generally okay with this so long as the certification remains voluntary The third and most restrictive is “licensure” which reuires a state license in order to practice This includes the medical and legal professions among others Friedman is fervently against all form of licensure and in order to try and prove his case he uses the medical profession as it is the one that would seem to call for licensure strongly I give him credit for this as it would have been easier to set up a straw man for this proposition I can’t say he sold me on his ideas here but I was surprised at how much “room for discussion” there was when he was done I certainly did not think he was off his rocker when he was done a thought that did occur to me early on in the chapter Definitely an interesting discussion Chapter 10 Distribution of Income Nothing new or ground breaking here by today’s standards However considering it was written in 1962 when the top tax bracket was 91% Friedman’s arguments in favor of a flat tax and a removal of “corporate welfare” were pretty out there Chapter 11 Social Welfare MeasuresChapter 11 and 12 really go hand in hand Here is Chapter 11 Friedman argues that most of the government programs designed to help are inefficient bureaucratically intensive and end up costing and doing less good then they should He argues there are effective ways of getting “assistance” to those that need it see Chapter 12 He also takes particular aim at Social Security as a horribly unfair system Not a whole lot that I found I disagreed with here are least in so far as the wasteful nature of government spending in these areas Chapter 12 Alleviation of Poverty This is Friedman’s solution to the problems he exposes in Chapter 11 He proposes a “negative income tax” for people under a certain “threshold” of income Under a negative income tax scheme anyone earning less than “X” would receive a lump sum from the government bringing them up to an agreed upon “minimum income level” Rather than a whole host of wastefully run government programs subsidized housing welfare food stamps etc that cost Billions a year “just to operate” these funds along with tax receipts could be redirected into cash payments that would provide greater assistance to those who need it I don’t know enough about the implications of such a program to know whether it is a truly workable system or whether there are significant drawbacks that would make it less attractive but when I heard itI LOVEDIT It seems like a simple elegant solution and an appealing way to streamline government bureaucracy and still help those less fortunate to maintain a minimum standard of living CONCLUSIONOverall this has to be considered one of the giant works of advocacy for both free markets and limited government I found Friedman thoughtful throughout even when I did not agree with him and found this to be a work that can be viewed by people across the political spectrum without raising undo ire I am giving this 40 stars overall but certainly think a few of the chapters are 5 star worthy including the final chapter 40 stars HIGHLY RECOMMENDED


  3. says:

    Friedman has constructed an airtight bubble of neoliberal thought where freedom is the greatest value and everything makes sense and fits together rationally only because it has no connection whatsoever to any kind of historical context much less the current social and political realities of our time None Period It is as though neither history nor reality as it is experienced by the poor exist an astonishing tour de force to explain why those with extreme wealth should feel happy and content and not the least bit guilty because exploitation really is to the benefit of all It depressed me to read this and made me go back and give Hayek another star Much as I disagreed with him and was saddened by his reduction of all socialist thought to what was essentially Stalinism I could at least see him grappling with the very real issues of our world with some kind of integrityThere is no integrity here I'm afraid Instead Friedman says absurd things likeThis is a role of ineuality of wealth in preserving political freedom that is seldom noted the role of the patron 17 With these ideas he'll never lack one children are at one and the same time consumer goods and potentially responsible members of society 33 Consumer goodsI don't even have a comeback to that one Luckily I don't need oneIt is hard to see that discrimination can have any meaning other than a 'taste' of others that one does not share 110 Good god don't get me started on his views on race and why white people shouldn't have to interact with a Negro in their local store if they don't want to How unions harm the world at large 124 The end of child labour and the 8 hour day are enough to start with as a riposte I thinkThe evils of reuiring medical doctors to be licensed 149 Yep Apparently one in a thousand uacks is actually on to something and licensing reduces their abilities to experiment 157 But now I begin to see why we need a large pool of really poor people And of course the old familiar and expected standbys lifted directly from this book into attempts at policy the evils of public housing minimum wage causing poverty and sadly not in the correct sense that in the US working for minimum wage leaves you under the poverty line social security as an invasion of our livesand etc To be fair I did expect the unions are evil bit But the rest was an enlightening surpriseTo cap it all off he writes Humility is the distinguishing virtue of the believer in freedom 188Believe me the last thing this book is characterised by is humility


  4. says:

    Friedman is a good marketer It's pretty clear why people without a deep logical background or analytic training would believe this book has something to say about freedom Friedman slyly uses the terms free freedom and free enterprise in every three sentences Eventually the weary subconscious relents and accepts that the man must be talking substantively about issues of freedom why else is the word so omnipresent? Of course he's not really For Friedman freedom is negative liberty the liberty not to be interfered with and he takes his starting point of analysis to be the individual which rarely holds since he'll uickly talk about net economic effects that are never started by an individual nor realized by them either But capitalism is a lot like the old Chinese proverb about the butterfly effect except far potent To start with the individual in a system that is so necessarily interconnected inter impacting globalized and omnipresent is as silly as to start with the atom in analyzing the relationship between the Milky Way and the Andromeda galaxy Both in economics and in astronomy little progress will be madeBut what about this idea of negative liberty that freedom is in essence not to be interfered with Well given the necessary butterfly effect of the economy it is an obvious absurdity since your job choices prospects of employment educational venues duration of employment financial stability etc are all freuently impacted by sources outside your control But even if they were not is freedom really negative liberty? That seems dubious and fortunately philosophers are finally coming around to the idea that freedom is actually realizing your fullest potential not being left alone We are social species and we realize are fullest potential in social relationships Friedman is right to promote voluntary co operation but he’s wrong that capitalism is the best outlet for this expressionOkay so how does all this really play out in the book? Can 200 pages really be objected to by just rejecting negative liberty out of hand? Maybe not Friedman has one argument that if accepted justifies almost all his conclusions throughout the book but if rejected undermines the entire text He attempts to show that capitalism really is the best expression of negative liberty Here it isAs in that simple model of a non coerced barter economy so in the complex enterprise and money exchange economy co operation is strictly individual and voluntary provided A the enterprises are private so that the ultimate contracting parties are individuals and B that individuals are effectively free to enter or not to enter into any particular exchange so that every transaction is strictly voluntaryThe first problem with this position is that the barter economy he refers to is ualitatively different than free market corporate capitalism He's comparing apples to oranges or at the very least a game of catch to the NFL But even if he weren't the privatization of the means of production into a few hands which is A undermines B Individuals that do not own means of production are not free to enter or not into particular exchange for if they do not enter the exchange of selling their labor power they will starve to death If one cannot avoid the exchange all together then one cannot reasonably be said to be free to enter into it If one wants a detailed explanation as to why this is the case I would recommend reading CB Macpherson on FriedmanAnyone that reads my reviews knows I am a socialist so finding problems with this book was bound to happen And anyone who doesn’t know my views is going to read this review and think it sucks because Friedman showed that socialism and freedom do not go together The problem is for Friedman there’s only one kind of socialism the USSR Instead of a few capitalist owning the means of production the state does That’s it for Friedman Two possible modes of production He never once deals with the argument as to whether the workers should own the means of production democratically I recently saw a debate with Friedman and Samuel Bowles where this uestion was raised Instead of answering it the host uickly changed the subject So Friedman knows this ‘possibility’ exist but refuses to address itSo before the naysayer reads this review and wants to spit fire at me and accuse me of being a tyrant go pick up Richard Wolff’s “Democracy at Work” It’s a very short read It’s well argued And anyone of average intelligence can understand it If and only if after you’ve understood what a Workers Self Directed Enterprise is you still have problems with my advocacy of socialism against Friedman’s warped cold war dichotomy will I engage in a critical discussion


  5. says:

    Friedman is definitely one of the most elouent economists ever to have ventured into public discourse and also one of the most influential And his arguments are powerful and almost impossible to argue against without stripping oneself of intellectual integrity No doubts about that But the imaginary debating partner cannot help but wonder if staking a claim to the moral high ground in an argument is not exactly the most liberal way of conducting one Friedman puts a lot of stock into how true liberalism must be determined and the gist is that it is about letting people choose what is best for them Now having agreed with that the imaginary debating partner would begin to feel slightly discomfited as Friedman begins to assert that given everything else his school has the right to define how this 'freedom' of expression should be exercised and defined This second definition feels discomfiting because the imaginary debater cannot uite get how Friedman can claim the authority to dictate that the natural tendency of all democracies towards being welfare states is not really in keeping with the best interests of people The imaginary debater tries to argue that with universal franchise surely we can allow the economic system to explore its welfare limits and see how it works just as we have explored mercantile limits earlier But Friedman takes no note and sticks to the stand that his school knows best what 'freedom' really is and how it is to be best expressed The imaginary debater makes one last attempt to try and point out that this is in contrast to Friedman's basic philosophy in life that underpins all his theories a basic distrust of all authority Seeing the futility the debate endsDisclaimer The book is a great read as reflected in the rating The reviewer is not to be held responsible for random debates that ensues in the reading


  6. says:

    I have always opposed Communism because I have thought it worships an idea and puts the idea before human life and the individual I decided iwhen I was young Lately I have come to the realization that libertarian neoliberal free market capitalist ideology does exactly the same People like Ludwig von Mises Ayn Rand Milton Friedman Yaron Brook etc are not less fanatic and contemptuous of actual life than fanatics on the other end of the spectrum like Stalin Mao Pol Pot Honecker Ceucescu etcIt is no less doctrinaire no less dogmatic no less totally contemptuous of any life that gets in the way of the almighty marketThe results have caused immense suffering in all the countries neoliberal economics have been applied But only to the lower rungs of society so the privileged oh so successful perfect ones would not care In Britain for example benefit cuts and super credit have destroyed countless lives Also you cannot call yourself a real patriot if you are willing to sacrifice your nation's culture and traditions to the almighty dollarThis is all nothing to do with freedom or respect for the individual It is idolatory worship of the golden calf of free market capitalism and Darwinian survival of the fittest Hitler believe in survival of the racial ''fittest and the extermination of the racially inferior' People like Von Mises Rand and Friedman see survival of the economic fittest as the goal and extermination of the socially and economically weakerThe older I get the I realize how evil and cruel unfettered rampant capitalism underpinned by extreme libertarian ideology is It has no pity and no respect for life It has nothing to do with freedom and it as doctrinaire and uncompromising


  7. says:

    An important book to read for any student of economics this is the basis of most American economic policy but it's WRONG and I think Adam Smith would roll in his grave to hear how people like Friedman are using his theories to make their friends richer while the masses struggle


  8. says:

    I last read Capitalism and Freedom as a teenager Rereading it I was surprised about how contemporary and undated it is even if the lectures it is based on were delivered than 60 years ago The lack of being dated is partly because much of the world has not changed eg we still have occupational licensing—in fact of it—and farm supports Milton Friedman was prescient eg the shift to floating exchange rates and lower top marginal tax rates Friedman helped shape our thinking see the previous and many of the same often wrong ways of thinking and canards Friedman are still alive and well eg a larger welfare state will make us unfree politicallyFriedman’s book is a combination of a normative worldview and a set of positive statements all applied to a variety of areas of economic policy The normative worldview is one of “liberalism” in the classical sense the idea that people should have maximum freedom from coercion by the state—or “negative liberty” to use Isaiah Berlin’s terminology as compared to “positive liberty” which is like the right to an education healthcare and the like He argues “Government is necessary to preserve our freedom it is an instrument through which we exercise our freedom; yet by concentrating power in political hands it is also a threat to freedom”Friedman argues that the genius of the market is to let everyone express their own views and tastes through what they purchase while government reuires a majority to impose its views on all The problem of government her argues is compounded by the lack of a mechanism to correct problems—it is hard to move cities even harder to move states and harder still to move countries—as compared to the market where you can simply stop buying the offending productFriedman makes two sets of positive claims The first is uite broad “a system of economic freedom” is a “necessary condition for political freedom” He is arguing that the the government interferes with economic choices the likely it is to become like the Soviet Union without political freedoms His two arguments for this proposition are 1 a thought experiment about how if the government owns all of the means of production it is impossible for dissenters to for example hire a printer to print their dissenting newspaper and 2 a set of syllogisms of the form “the Soviet Union is not a market economy the Soviet Union is a dictatorship therefore if you are not a market economy you are a dictatorship”This broad claim may well be true in the limit the situation that both the thought exercise and syllogism apply to But sixty years of data have proven very unkind to it absent that limiting case The National Health Service in the UK for example may be a good or a bad idea but by moving some fraction of the way to nationalization it has not exactly impeded freedom and liberty The Scandanavian countries have much larger governments but also do not display systematically less freedom There are arguments for and against larger state involvement in the economy but to say it is The Road to Serfdom as Friedman drawing on Friedrich Hayek argues is not helpfulFriedman’s views about the links between economic policies and political freedom reach an almost self parodying extreme when he argues that any form of exchange rate management is “the most serious short run threat to economic freedom” and that “the most effective way to convert a market economy into an authoritarian economic society is to start by imposing direct controls on foreign exchange”The second set of positive claims that Friedman makes are around a lot of specific economic policies arguing that in almost every case good intentions have perverse results and even judged by the moral standard he attributes to intellectuals a sort of paternalistic eual outcomes interventionists mindset they are failures He argues this is true of countercyclical macroeconomic it introduces instability and worsens the business cycle anti monopoly legislation it can entrench monopolies progressive taxation in some ways it increases income ineuality housing projects it destroys the housing supply and the minimum wage it increases unemployment and makes the poor worse offNo doubt some of these are right like housing projects where the emphasis of policy has appropriately shifted towards housing vouchers and reducing barriers that complain housing supply—ideas that are along the lines of what Friedman is arguing Some of these are almost certainly wrong the increased stability of the macroeconomy—including the fact that the Great Recession was much milder than the Great Recession—is thanks to the fact that policymakers especially in Central Banks have ignored Friedman’s mechanistic and disastrous proposal for monetary policy to simply increase the growth of the money stock with no regard to anything else in the economyWhat I find suspicious is that that contrary to the rigorous hard headed thinking Friedman claims to espouse much of this reads like wishful thinking Friedman essentially wants to have his cake a classical liberal view of justice and eat it to if you follow his normative philosophy you’ll get better outcomes even measured on your different normative philosophy For example progressive taxation isn’t just a violation of liberty it also can make the distribution of income even worse This is the type of too good to be true wishful thinking that he would rightfully decry in other circumstances And it means he avoids some of the tough tradeoffs one would have to consider about whether one prioritizes liberalism as a philosophy or outcomes because they will not both line upIn Friedman’s defense he does have a reason—other than pure coincidence—that his normative and positive views line up so closely Specifically he argues that public policies are not done randomly or by wise policy mandarins but instead systematically shaped by self interested parties These policies can persist because they have a small number of highly visible winners and many invisible losers He would argue the minimum wage has this feature being pushed by labor unions to help their members creating a bunch of visible winners receiving higher wages and many people without jobs who may not even realize it was because of the higher minimum wage I am not endorsing his view just describing it—the evidence since his book has at the very least cast substantial doubt on this particular argumentAll of that said anyone who cares about public policy should think very hard about the imperfections of government the distortions of rent seekers and regulatory capture the role of incentives and unintended conseuences You do not need to agree with Friedman’s every prescription to benefit from better understanding all of these issues and factoring them in to your evaluation of public policy going forward


  9. says:

    No longer using this website but I'm leaving up old reviews Fuck Jeff Bezos Find me on LibraryThing read this book as part of a class on Political Thought I had food poisoning at the time that this book was assigned but I would have been puking even if I hadn't had those undercooked pancakes that day This book is so full of ruling class whitewash that it is truly difficult to readThe text essentialized was as follows Capitalism offers rich people choices These choices can be redefined as freedom Therefore Capitalism offers freedomLeft out is what to do if you don't have the luxury of being able to buy choices Left out is how these choices in fact necessitate others' oppression and their lack of freedom Left out is any semblence of understanding of what it is to work for those choices to be available to someActually let me rephrase Friedman mentions these points specifically on several occaisions He then explains that it is not anyone's business how to answer these uestions all policy is to be made between stock holders and companies itself no matter who else is affectedWhen Milton Friedman died I gave everyone I knew a high five


  10. says:

    Reading this book is like looking at a mirror into your own beliefs how you react to Milton Friedman's philosophy tells you about yourself than about the validity of the system Fault lies totally with MF who does not offer enough evidence to support his worldview which is to limit government and expand free market in order to maximize 19th century liberalism where everyone is free such that one person's freedom doesn't impinge upon another's The lack of concrete evidence completely distressed me especially for a book intended for a lay audience I'm not expecting a mathematical proof although that would be nice but I am expecting some sort of empirical evidence if I am to believe as MF argues at one point that we need to abolish licensing of physicians in the US To be fair there are one or maybe two chapters that are well argued The one that sticks out in my mind is on education in which Friedman argues IMO uite successfully that government should not administer education but offer vouchers for approved schools nb this seems like a form of licensing that later MF argues against Then there is also the point that people tend to spend less on housing and basic needs in capitalist countries than in non capitalist ones And there is the prescient argument that unless the government repeals deductions for corporate charitable giving we will be led down a slippery slope to a time now when corporations are treated as individuals which runs counter to 19th century liberal ideals Unfortunately good arguments are few and far between Ad hominem attacks such as calling the president a country banker replace what could have been great definitions of an exchange or a market which is important since these ideas are central to Milton Friedman's philosophy College freshman style philosophical logic replaces measures readers can look at to evaluate both Friedman's and extant economic systems And a very weak ethical argument on the ethics of income ineuality basically Milton Friedman claims he can't think of a good one replaces what should be an attempt at a strong converse to capitalism that is an attempt to show that any other economic system both real and imagined is worse than capitalism in some way Any way I don't need an answer but at least a good attempt I am startled at how little I learned in this book compared to Thinking Fast and Slow written by another Nobel Prize winning economist Daniel Kahneman although intellectually he is a psychologist That book while also dense is replete with facts studies and definitions and changed how I viewed the world Capitalism and Freedom on the other hand made me want to write this letterDear economistsWe are reading your book because we want to learn something We are willing to struggle in order to understand your point of view so please don't insult our intelligence by giving us no data or methodology so we can think for ourselves and evaluate your argument When writing for a lay audience please don't write a pamphlet write a book BestSuman