The key takeaways from North are:
[Friedman] argued that the FED did not inflate enough in 1930-33. He wrote this in A Monetary History of the United States (Princeton University Press, 1963).
In that same year, across town (Princeton), another publisher released Murray Rothbard's America's Great Depression, which argued that the FED indeed caused the depression . . . by its expansionist policies, 1926-29. The battle on this issue began in 1963. It still goes on. Establishment economists blame too little government, too little monetary inflation. Rothbard blamed too much of both.
The [Rothbard] ghost did something considered intolerable, 40 years ago. He said that Milton Friedman on the money question was just another promoter of fiat money.
[Friedman] was a self-conscious disciple of Irving Fisher, the self-professed socialist (if push ever came to shove) and incomparably bad forecaster who announced in September 1929 that the stock market had reached a permanent plateau. He went on to lose his personal fortune (he invented the Rolodex) and his sister-in-law's fortune in the Great Depression. He became a laughing stock among economists, a great embarrassment to the profession. Yet he invented the index number, which is basic to the ideal of targeting inflation by the Federal Reserve System. It was Friedman who almost single-handedly resurrected Fisher's reputation in the 1950s from the grave that it so rightly deserved. Friedman called him the greatest American economist in history.
Ever since late 2008, Ron Paul has reminded the public, in effect, "we Austrians told you so, and we also told you why -- the Federal Reserve's policies under Greenspan and Bernanke." The Federal Reserve caused the crisis of 2008. To expect it to be able to cure it safely is naive.
The Friedmanites, who did not see the crisis coming in 2007 -- but a lot of Austrians did, and said so in print -- were caught flat-footed. They are now enraged at Ron Paul and the Austrian economists. So, there is no hue and cry from Fiedmanites over the massive expansion of the monetary base.
Friedman spent his career devising strategies to make the government more efficient. He was a technician who, as a Treasury Department staff economist, advised the U.S. Treasury on how to be more efficient, beginning in 1943, with his technical support for New York Federal Reserve Chairman Beardsley Ruml's plan to impose withholding taxes on the American people. The government got more efficient, fast. Revenues from income taxes (personal and corporate) quadrupled from $8 billion to $34 billion, 1942-1944.
We need less efficient government. Friedman never grasped this. Rothbard did. The few Establishment economists and columnists who have read Rothbard have never forgiven him for this.
The Austrians argue that monetary policy should be decentralized by means of the use of precious metals coins. All other schools of economics, invoking Keynes and Fisher, believe that monetary policy should be centralized in a committee of university-screened graduates of state-accredited universities. These people must be given the power of the state to enforce their policies. Without state-licensed fiat money, the public would be in control. The Establishment will not tolerate this.
Friedman was the main apologist for fiat money in the free market camp. He believed in free market liberty, but not where it is really important: education (vouchers based on state-confiscated money) and money itself (central banking based on a grant of state power: a monopoly). Murray Rothbard challenged both ideas. He therefore remains a pariah to the Establishment.