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Milton Friedman Making an Ass of Himself in 1976

Posted by libhom Wednesday, May 20, 2009

Milton Friedman's asinine extolling of the virtues of greed back in 1979 rings very hollow now. It would have equally so to someone who lived in 1932. It's truly amazing that so many Americans are so historically ignorant and poorly educated in general that they took what he and his acolytes said so seriously. Some people still do.



Friedman didn't know about the Internet, which disproves his claim that governments cannot create great human achievements. He also was wrong about Einstein. Many of Einstein's greatest achievements occurred while doing government funded research.

Friedman also was full of it on "free trade." There never has been a country that has expanded its industrial economy without massive protectionism. If you study history from a factual, rather than an ideological, perspective, you will see that. Even Great Britain, which preached the loudest for free trade during its empire, engaged in the some of the most naked protectionism in world history.

Naomi Klein also has accurately pointed out that extreme capitalism does not equal freedom, as Friedman implies. In fact, it has to be imposed with the power of the state and the force of arms, usually with governments employing torture to shut people up.

Of course, Friedman's wasn't sincere in what he was saying at all. He was not really an economist at all. He was a propagandist who got quite rich developing lies and spin to justify the brutalization of the vast majority of our society and so many others in order to benefit the super rich.

 

9 comments

  1. two crows Says:
  2. free trade: "keep up with the Joneses, or else."

    what a sad commentary on our culture that so many willingly bought into their own subjugation.

     
  3. David Duff Says:
  4. Well, if Friedman was "wrong about Einstein" I'm not too sure how 'right' you are. Being a very minor functionary in the Berne Patents Office during which he produced his 4 famous papers hardly counts as "doing government research!

    However, you are right to say that there has never been perfect free trade because, of course, it is a human activity and therefore incapable of perfection. However, during Pax Britannica (roughly the 19th century) the world saw a huge jump in trade and prosperity. Similarly in what might be described as 'Pax Americana' after WWII the same thing occurred. Buying and selling to each other is the way to prosperity for the most, and that is oneof Friedman's main points.

    It seems to me that you are a man uncomfortable with paradox, which is a pity because life is full of them. Thus you seem incapable of discerning that private sin might lead to public good. For example, Henry Ford (and I know very little of him) might have been extremely greedy in his desire for more and more money when he first started building his motors and possibly he treated his workers with less that what you might think of as a fairness or generosity. However, in the end they, and their successors, prospered, as did the workers in all the trades and professions who produce the things that go into cars, and all the people who sell and service them. The imput to the economy is immense even if the progenitor was a greedy, selfish man.

     
  5. libhom Says:
  6. two crows: It just shows how effective propaganda can be.

    David: Einstein's career didn't stop with those four papers. He developed the theory of General Relativity, which is even more important than the earlier four papers combined, later at a government funded university. He made enormous contributions to science after that, while working in government funded academia.

    As for "free trade," you have a poor understanding of history. Under Pax Britania, most countries were worse off economically than they were before, the exceptions being those countries that were militarily strong enough to practice protectionist policies. The vast majority of people in the UK suffered terribly under that regime. Only a small wealthy elite was better off.

    Looking at more recent history, Japan's relaxation of protectionism caused a depression for that country that they still haven't fully recovered from. The relaxation of protectionism by the US has resulted in drastically lower living standards for the overwhelming majority of people here, people whose lives aren't deemed worthy of mention by the US corporate media. Relaxation of protectionism has led to foreign debt which has contributed to the stock market crash, the banking collapse, and the deep recession we are just beginning to experience.

    As for Ford, his greed caused him to fight innovation in the auto industry (study the entire history of Ford and the Model T), oppose unionization, try to sabotage the New Deal, and to admire and help fund Hitler's rise to power. Ford is a perfect example of why society must regulate greed and corporate power.

    In science, a "paradox" means one of two things. Either science has yet to arrive at a full understanding of natural phenomena, or it is a metaphor used to provide a vaguely approximate explanation for someone who hasn't studied the field long enough to understand the actual explanation. In political rhetoric, a "paradox" is a rationalization of bad logic.

    You should stop unquestioningly buying into propagandistic talking points and start learning about history and life on your own. The acolytes of Friedman will gladly feed you a highly censored and distorted version of history in order to push their wealthy employers' ends.

     
  7. David Duff Says:
  8. Of course, I am aware that Einstein went on later to refine his ideas on relativity but most people would reckon that his great breakthrough occurred during the first decade of the 20th century when he was a minor official in the Berne Patent Office - indeed, it was one of those four papers that eventually earned him his Nobel prize.

    Honesty insists that I make no claim to being a historian or even having any expertise in historical matters but your stern admonition that I begin to learn history provoked a wry smile as I gazed about me at the shelves of books for whose untidiness I receive regular bollockings from the 'Memsahib'! Out of curiosity I counted the history books which begin, time-wise, with "The Punic Wars" by Nigel Bagnell and which end with "The History of the Modern World" by Paul Johnson and I make the total 162 - not counting the biographies!

    And talking of books, allow me to recommend Empire by the economic historian Niall Ferguson: "According to one estimate the economic benefit to the UK of enforing free trade could have been as high as 6.5% of GDP. No one has yet ventured to estimate what benefit to the world economy as a whole may have been; but that it was a benefit and not a cost seems beyond dispute, given the catastrophic consequences of the global descent into protectionism as Britain's imperial power waned in the 1930s. [my emphasis]"

    It is tedious to engage for too long on the precise meanings of words so let us lean on the OED: "paradox a statement or proposition which, despite sound (or apparently sound) reasoning from acceptable premises, leads to a conclusion that seems senseless, logically unacceptable or self-contradictory. That, I would suggest, is an exact description of my proposition that capitalists can be exceedingly wicked but from the actions and endeavours great good might grow.

    But let us end with agreement. I, too, think that it is the proper function of government to 'regulate' the free market but of course it is the very stuff of politics, and our disagreement, as to precisely what the word 'regulate' means. Back to teh dictionary . . .!

     
  9. GDAEman Says:
  10. The phrase "full of shit" comes to mind.

     
  11. libhom Says:
  12. If anyone other than David and I have gotten this far down the comments section of this post, you may wonder who Niall Ferguson is. Having read his opinion pieces from time to time in the New York Observer, I am familiar with him as a standard issue British pundit/PR flaque for wealthy and corporate interests.

    Even if his 6.5% GDP increase figure is correct, and he admits it is at the upper end, corporate controlled trade (often inaccurately referred to as "free trade") creates such distortions in the distribution of income and wealth that even a 6.5% increase in GDP doesn't make up for it. With that GDP number, Ferguson is tacitly acknowledging that corporate controlled trade hurt the majority of the population in the UK.

     
  13. David Duff Says:
  14. In the interests of accuracy, which I am sure you share with me, Niall Ferguson is also:

    'Herzog Professor of Financial History at the Stern School of Business, NYU; Senior Fellow of the Hoover Institution, Stanford University;Senior Research Fellow, Jesus College, Oxford and the author of "Paper and Iron", "The House of Rothschild", "The Pity of War" and "The Cash Nexus".'

    At the risk of terminal tedium allow me to pose you a further point on 'free trade' which you, incorrectly in my view, categorise as "corporate controlled". 'Farmers' (I use inverted commas to indicate that their meagre scratchings barely qualify them for the title) in Africa barely make a living and often face destitution. The main reason is that the farmers, not corporations, in America and Europe have twisted the politicians' arms up their backs to keep high tarrifs in place. Were they to be removed, trade would flourish, you and I (and poor people in our own countries) would pay less for our food. African farmers would prosper and perhaps over time would have enough political clout to oust the gangsters who run their countries. Some Euro-American farmers would go broke but others would improve their techniques to compete. This actually happened in New Zealand a few years ago when all government subsidies to agriculture were abolished. Result? The farmers prospered!

    Finally, perhaps you could remind us all of what has changed in China in the last few years which has turned a moribund economic fossil into an enormously prosperous and all too lively giant?

     
  15. libhom Says:
  16. David: Thanks for proving my point about Ferguson. The Hoover Institution is a public relations/lobbying organization for wealthy and corporate interests.

    As for China, their success is due to switching from socialist absolutism to a mixed economy employing heavily protectionist trade policies. China is an excellent example of how protectionism works.

    As for farmers in Africa, corporate controlled trade, if fully realized, will result in most of them being wiped out entirely by big agribusiness. That's precisely what happened to millions of Mexican farmers under NAFTA. Extending corporate controlled trade to Africa would literally be an act of genocide.

     
  17. ultragreen Says:
  18. Duff: "'Farmers' (I use inverted commas to indicate that their meagre scratchings barely qualify them for the title) in Africa barely make a living and often face destitution. The main reason is that the farmers, not corporations, in America and Europe have twisted the politicians' arms up their backs to keep high tariffs [sic] in place." Were they to be removed, trade would flourish, you and I (and poor people in our own countries) would pay less for our food. African farmers would prosper and perhaps over time would have enough political clout to oust the gangsters who run their countries."


    There is no possibility that a subsistence farmer will become rich through free trade: As a matter of fact, most subsistence farmers are driven off of their farms by free trade and forced to engage in menial labor in urban ghettos. The transformation of subsistence farming into a big business in the United States provides a perfect example of this: At one time, most people in the United States lived off the land that they owned. Today, less than 2% of the population engages in any kind of farming!

    And so, if the tariffs and other barriers to agricultural products were removed, one of two things would happen: 1) Agribusiness in the United States and Europe would drive the small farmers in Africa out-of-business, forcing African consumers to buy agricultural products from these large corporations, or 2) agriculture in Africa would be forced to become a big business itself, which would also drive the small farmers in Africa out-of-business!

    Of these two possibilities, alternative #1 is far more likely to occur because agribusiness in the United States and Europe is highly advanced and very aggressive in pursuing new markets.

    There are other flaws in Duff's reasoning on free trade, but libhom has already discussed several of them. If you look objectively at the evidence that has accumulated since the Reagan era, it has become clear that the policy of free trade is a colossal disaster that is in part responsible for our current economic difficulties.

    As for the comment that the government doesn't produce or support anything that is useful, that's one of the dumbest and most ignorant comments that I've ever heard! The more important question is: What major innovation hasn't the government played an important role in developing?

    All of the following were developed with government support: computers, airplanes, soybeans and other agricultural crops, antibiotics, nuclear power, weather and communication satellites, fuel cells, the internet, air conditioning, biotechnology, railroads, money and other forms of common currency, recreational parks & nature preserves, almost all military weapons, schools and universities, mass transit in cities, roads & highways, postal mail service, etc.

    Without the services and regulation of the government, capitalism itself would quickly collapse into social chaos and disorder! What prevents people from looting the stores and emptying the shelves? The near monopoly of force by the government!

     

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