Saturday, September 14, 2013

Paul Samuelson Didn't Think Much of Milton Friedman as a Macro Economist

Probably for the wrong reasons, but the late Paul Samuelson didn't think much of Milton Friedman's macroeconomics.

WSJ is reporting on an exchange of letters between Samuelson and his nephew Larry Summers:
Friction had emerged earlier in 2006, when Mr. Summers praised the late Mr. Friedman in a New York Times column. Friedman was "the most influential economist" of the second half of the 20th century, Mr. Summers said.

"For your eyes only," Mr. Samuelson wrote to his nephew of Mr. Friedman, "I had to grade him low as a macro economist" and "stubbornly old fashioned."
Murray Rothbard, from a different perspective, didn't think much of Friedman either:
  Mention “free-market economics” to a member of the lay public and chances are that if he has heard the term at all, he identifies it completely with the name Milton Friedman. For several years, Professor  Friedman has won continuing honors from the press and the profession
alike, and a school of Friedmanites and “monetarists” has arisen in seeming challenge to the Keynesian orthodoxy.  
 However, instead of the common response of reverence and awe for “one of our own who has made it,” libertarians should greet the whole affair with deep suspicion: “If he’s so devoted a libertarian, how come he’s a favorite of the Establishment?” An advisor of Richard Nixon and a friend and associate of most Administration economists, Friedman has, in fact, made his mark in current policy, and indeed reciprocates as a sort of leading unofficial apologist for Nixonite policy.  
 In fact, in this as in other such cases, suspicion is precisely the  right response for the libertarian, for Professor Friedman’s particular brand of “free-market economics” is hardly calculated to ruffle the  feathers of the powers-that-be. Milton Friedman is the Establishment’s
Court Libertarian, and it is high time that libertarians awaken to this fact of life.
It should also be noted that late in life during a  lunch with the Financial Times, in San Francisco at the North Beach Restaurant, Friedman admitted, in what has become known as the North Beach confession, that  his crude Keynesian-type monetary theory was not a success in operation.

1 comment:

  1. I lost my respect for Friedman when I learned that he tried to read "Pure Theory of Capital" but called it incomprehensible.