Thursday, April 15, 2021

Conservatives Discover Milton Friedman Not the Hero They Thought He Was

 Dale Steinreich writes:

On this Tax Week in April (even though the real individual filing deadline for this year has been extended to May 17, 2021), some conservatives are discovering that Milton Friedman isn’t the hero they thought he was. Friedman was behind “one of the most far-reaching extensions of federal power,” the purpose of which was to keep federal coffers copiously filled to fight World War II.  Of course the war ended but Friedman’s “gift that keeps on giving,” federal withholding, is still here.  More than just making federal taxes appear lower than they actually are, through typical overpayment withholding gives the federal government a nice, big interest-free loan every year.  Thanks, Milton!

This 1 minute and 26-second clip explain Friedman's role in withholding taxes. 

I want to also point out that while Friedman had a strong knack for defending free-market positions when it came to his actual policy advice he always landed on the side of being a big government technocrat.

During the period of the Vietnam War when there was growing anti-war, anti-empire sentiment in the United States, instead of promoting a shrinking U.S. military, Friedman promoted the paid-for army, which of course he labeled with the "all volunteer" army. It was actually a "keep the large military intact" program. He provided the military with the tactic to keep the military massive in the U.S. when the draft was not going to last.

He also promoted school vouchers, which of course keeps government in the role of the final determinant of who can teach and what to school children

And last, but not far from least, he promoted a quack technical argument to promote monetary expansion by the Federal Reserve.

This is the real Milton Friedman legacy:

Creating withholding taxes.
Promoting the paid-for-army.
Promoting school vouchers.
Promoting a use for a central bank.

In sum, when you weigh the good he did with his free-market arguments and his technocratic policy advice to keep governments growing, there is no question he was a very bad guy when all the pluses and minuses are calculated.



  1. Don't agree at all. Everything in context, RW. Withholding was proposed as a WW 2 "war time" emergency measure; the all "volunteer" army was to replace the most anti-libertarian of policies: military slavery/draft; school vouchers provided some choice in schooling (some choice is better than no choice) and is NOT necessarily (logically) connected to government-determined curriculum or teacher qualifications; and Friedman's monetary rule (no discretionary power for the Fed; simple automatic 3% increase) neuders the Fed looks positively benign compared to what progressives, conservatives (and even some libertarian/Austrians) propose. Friedman may not have been a radical libertarian (and he was no Austrian) but to call him a "very bad guy" because his policy proposals were not radical enough is a mistake and a variation of the Demsetz Nirvana fallacy. Even Mises--and especially Hayek--fail the absolute purity test on policy. And in the case of Mises and Hayek....they (unlike Friedman who was not an Austrian by training) had no excuse...

    1. Good call. It's like Jefferson owned slaves and that cancels him out? Ditto Friedman. The positives outweigh the negatives by far.

  2. It's fair to criticize Milton Friedman for these and other actions but he had a knack for explaining basic free market economics to the general public. I'm ashamed to say it was his way of explaining the basics that opened my eyes to reality very late in life. I had absorbed all of the nonsensical economic fallacies that I was taught in school without much thought. Within an hour of watching Milton Friedman videos on Youtube I was converted, or at least curios to learn more. I think he deserves some credit for his work promoting free market econ to the masses through his appearances on popular TV shows. I would guess that there are thousands of people, who like me, were changed forever by listening to or reading him. There are many other more pure economists that have had little to no effect on the general public.

  3. On the other hand:
    - opposed Iraq war when everyone else was giving into the hysteria
    - called for abolition of the Fed
    not just this one clip, I've got stuff on him dating at least back to the 1970s saying this
    - was one of the very few who could get through to the conservatives about the drug war without being labeled a kook. There's a reason for William F. Buckley came out against the drug war in National Review and that reason is Milton Friedman

    And complain about vouchers if you want but if your kid was zoned in a horrible government school today and vouchers came along tomorrow to bring you some options for something a lot better (or at least not horrible) it would be one of the best things to actually improve your kid's quality of life now and in the future

    I'd encourage everyone to listen to the Milton Friedman Speaks series of podcasts available below and on iTunes:

    1. Oh please, do you really want to play this game?

      Friedman was a monetary crank who favored increases in the money supply at a steady rate by the Federal Reserve. Occasionally, he would call for the end of the Fed to put another body in charge of the monetary printing but it is a major distortion to claim he was in favor of ending the Fed without putting in context what he wanted, government money printing: (4 minute mark).

      Like I said above, he was good when he wasn't giving direct advice to the government, he wasn't during the Iraq war but the only reason that the military had Empire strength was his "pay for soldiers" plan kept the military at a vast size after the Vietnam war when it would have collapsed along with the draft.

      As far as vouchers, what about not taxing people and ending public schools?

      See how dangerous Friedman was, he has you supporting all kinds of statist measures. He was a very slick statist.

  4. Was Adam Smith a "slick statist"? Or how about Hayek..(in The Constitution of Liberty) who had far more objections in policy to the free market than Milton? Or how about David Stockman whom you regularly publish? William Graham Sumner, the subject of my dissertation, was as close to a pure libertarian/free market economist as there was 150 years ago (he even anticipated and rejected antitrust law) BUT he supported public schools and some "public works" projects. Does that make Sumner a "slick statist?" Look, if we ever want to be taken seriously, we must stop putting people such as Friedman in with real slick statists like Galbraith and Krugman. As has been noted, Friedman (and Rand) probably turned more people on to free market ideas and policies than almost anyone in the last 50 years. And if my friend Walter Block chimes in that Friedman was really a "socialist" I will take him to the woodshed when I see him next!! Come on guys, get real.