There are multiple academic and popular understandings of the relationship of Capitalism and Freedom, though in popular political discourse these two concepts often get conflated as one and the same thing. Indeed, some important thinkers intentionally conflate the two concepts. For example, Milton Friedman, the well-known Nobel Prize winning economist and economic advisor to President Reagan and Margaret Thatcher, essentially argued that economic freedom was part of freedom, in his book Capitalism and Freedom, written in Friedman, along with earlier writers, Friedrich Hayek, Ayn Rand, Ludwig von Mises, to mention the names most commonly associated with such views, essentially defined the philosophical and moral positions that came to comprise both libertarian and much mainstream Republican and Tea Party thinking.
Jim Farmelant 1 Liberty and free market capitalism Notes on Milton Friedman January 7, Today, I would like to talk about the issue of capitalism and freedom or more specifically, as to whether what we understand to be political freedom requires the existence of a capitalist economy.
Over half a century ago, the eminent University of Chicago economist, Milton Friedman wrote a book titled Capitalism and Freedom, which looking back fifty years later would seem to have turned out to be a very influential book.
Friedman was by trade an economist but today I will be discussing his views as a political philosopher and ideologue, although there is no doubt that much of his influence in those capacities was rooted in the fame that he had garnered as an eminent economist.
He disagreed with the Keynesian approach to macroeconomics, which favors government spending as a corrective when there is too much unemployment. He complemented his thesis with research on the monetary history of the USA, which he believed provided strong empirical evidence for it.
For Friedman, it is the money supply that is the main determinant of the price level.
They basically revived what had been known as the Quantity Theory of Money that had been popular back in the 18th and 19th centuries. Likewise, they held that inflation results from an overly loose monetary policy. Friedman did not see fiscal policy, apart from monetary policy, as having the kinds of potentially beneficial effects that the Keynesians have tended to attribute to it.
On the contrary, Friedman was very wary of deficit spending because governments tend to loosen up monetary policy excessively in order to finance deficits. Although in principle monetary policy could be conducted in a countercyclical manner, with monetary policy being loosened in response to economic downturns and tightened when economic conditions improved to avoid inflation, Friedman was opposed to this on the grounds that it is impossible to predict when a shift in monetary policy would have discernible macroeconomic effects.
Just as Max Weber, a century ago, had argued for a value-free social science, so Friedman argued for a value-fee economics which Essays in Positive Economics would be a positive or natural science, not unlike physics, chemistry, or biology.
He also famously argued that theory or hypothesis must be judged by its: Together with Ludwig von Mises and Friedrich Hayek and Ayn Rand, he defended free-market capitalism, which, he argued, is more efficient than alternative economic systems and is more conducive to the emergence of political freedom.
Neither half of the statement expresses a relation between the citizen and his government that is worthy of the ideals of free men in a free society. The paternalistic "what your country can do for you" implies that government is the patron, the citizen the ward, a view that is at odds with the free man's belief in his own responsibility for his own destiny.
The organismic, "what you can do for your country" implies that government is the master or the deity, the citizen, the servant or the votary. To the free man, the country is the collection of individuals who compose it, not something over and above them. He is proud of a common heritage and loyal to common traditions.
But he regards government as a means, an instrumentality, neither a grantor of favors and gifts, nor a master or god to be blindly worshiped and served. He recognizes no national goal except as it is the consensus of the goals that the citizens severally serve.
He recognizes no national purpose except as it is the consensus of the purposes for which the citizens severally strive. For Friedman, society is constituted by individuals.
There are individual men and women, and there are families. And he emphasized that historically, the rise of liberal democracy and political liberties coincided with the rise of modern capitalism in the 18th and 19th centuries. He argued that a free- market economy was necessary to provide checks against the ambitions of governmental politicians and to provide thus a basis for the preservation of political freedom and democracy.
On the basis of this argument he justified his giving economic advice in the s to the Pinochet government, which clearly was hostile to both democracy and political freedom, since while Pinochet himself might have been a fascist thug, his economic policies, so Friedman argued, were conducive to the eventual expansion of liberty and democracy.
Later on when political democracy was eventually restored in Chile, Friedman claimed this as a vindication of his argument. Friedman also contended that since free market capitalism is able to organize economic activity in a noncoercive manner, that what he referred to as economic freedom, was itself a vital part of political freedom.
Rand held that the moral as opposed to the economic ideas of Mises and Hayek and Friedman were dangerous because they were all utilitarians and so assessed the desirability of social institutions and of public policies in terms of which ones they thought would tend to augment most the sum of human benefit as measured in terms of happiness or pleasure or the satisfaction of human desires.
She contended that such thinking is profoundly mistaken because it is more naturally suited to provide a moral basis for socialism than for capitalism and hence could be used to defend capitalism only by means of special pleading and dis- torted reasoning. In support of his contention that under free market capitalism, the market can act as a check against state coercion, Friedman advanced the argument that the free market provides us with a way for organizing economic activity in a non-coercive manner.
Friedman does this by first outlining how a simple market economy would work. This simple economy consists of more or less self-sufficient individuals and households where people make goods and services and exchange them among themselves.For example, Milton Friedman, the well-known Nobel Prize winning economist and economic advisor to President Reagan and Margaret Thatcher, essentially argued that economic freedom was part of freedom, in his book Capitalism and Freedom, written in Capitalism and Freedom Essay Sample.
The major theme of Capitalism and Freedom by Milton and Rose Friedman is that private enterprise in a free market is necessary to maintain economic and political freedom.
This early work of Friedman (and famously his wife, Rose) is a seminal book and tutorial about the uniqueness of capitalism, and how that contrast with competing economic models.
I think Friedman's writing lacks the punch and /5(). The major and very dramatic theme in Milton Friedman’s book Capitalism and Freedom is the role of competitive capitalism. This book contains of classical and very informative libertarian thoughts which strongly influence the defense of the idea of capitalism.
1 Liberty and free market capitalism Notes on Milton Friedman January 7, Today, I would like to talk about the issue of capitalism and freedom or more specifically, as to whether what we understand to be political freedom requires the .
Milton Friedman’s Capitalism & Freedom is one of the most important books regarding economics of the 20th century.
His thoughts laid the groundwork for the emerging modern conservative movement, which was an evolution of .