Free to Choose: A Personal Statement

Twenty-five years after its original publication as the book companion to a PBS series, Milton and Rose Friedman's "Free to Choose" (FTC) remains a highly relevant, easy to read, classic tome expounding the virtues of free market capitalism and the flaws and dangers of socialism and government control of the economy. The Friedman's brilliance in FTC is to continually demonstrate how government control inhibits personal freedom, whereas free market capitalism is what results when individuals have the right to "life, liberty and the pursuit of happiness". The roots of the Friedman's arguments go all the way back to the Jeffersonian concept of liberty as defined in the Declaration of Independence. Modern-day liberalism, which still believes in the "right to choose" in many social arenas (in fact, these exact words are used by abortion rights supporters), does not believe in an individual's right to choose in economic manners (e.g. liberalism would say a woman can choose to have an abortion, but it should be provided by a doctor working in the government run healthcare system). When the Friedman's describe their ideal economic system and practices, they are describing the principles of classical liberalism, or libertarianism. In FTC, the Friedmans present the basic arguments of libertarianism in engaging, persuasive language using layman's terms. The Friedmans have obviously won many converts. Milton Friedman was one of the intellectual forces behind the Reagan revolution, and showed how to boost the U.S. economy by lowering marginal tax rates and reducing government regulation. He is the father of school vouchers, to give poor Americans the opportunity to choose the schools their children attend (this is described in FTC chapter six). He won a Nobel Prize for his monetary theories, and FTC includes an analysis of the monetary failures that Friedman claims both led to and prolonged the Great Depression. FTC covers many other important economic topics. The Friedmans present strong arguments in favor of free trade, which is constantly under attack in the halls of Congress. They describe the downsides of government regulation, and show how it can lead to the opposite of the intended effects. An entire chapter is devoted to the cause and cure for inflation, a problem that bedeviled the U.S. in the 1970s and that gave rise to the Reagan revolution. But I would cite chapter five, entitled "Created Equal", as the single most important chapter in the book. The Friedmans show how the concept of equality has changed since the country's founding, and show the dangers of "equality of outcome", which many misguided politicians and other leaders appear to want, although not individuals (else why do so few choose to live in communes?). I've heard it said that California Governor Arnold Schwarzenegger hands out copies of this book as gifts. If so, he should be careful about passing out copies to his Kennedy in-laws, as this book just might cause Ted Kennedy's mind to blow if he ever bothered to read it. Someday, the last of the old guard socialists such as Castro and Ted Kennedy will pass on, thereby providing more opportunity for the "turning tide" towards economic freedom that the Friedmans describe in the last chapter of FTC to become even more prevalent.

This book presents a clear, thoughtful, and rational argument for maximizing free choice within the limits largely set by John Stuart Mill's "On Liberty" (that is, one may not use his or her liberty to harm another). Friedman sets out a strong case that when people are left to pursue their own interests, the whole becomes greater than the sum of the parts, and the commonwealth benefits more than when central planners try to orchestrate economies. That should be obvious now that nations like China and Vietnam, while retaining political repression, have given wide scope to free markets and thereby lifted millions out of poverty. Contrast that with Cuba or Venezuela, where central economic planning prevails, and the people are largely destitute. The book's argument is often attacked as an appeal to "greed," which is unfortunate as "self-interest" is not necessarily greed. I think mostly of one of my leftist friends in this regard who assails capitalism and whatnot, but who, due to his comfortable job in a government bureau, is able to pursue an acting and singing career after hours. Is he not, there, pursuing his self interest? And doesn't the larger public benefit from his ability to deploy his talents? I along with many have enjoyed many of his performances, and will continue to. It's just Friedman's thesis at work: we all benefit when everyone seeks his own interest. The book is often attacked as being anarchistic (or something like that) -- that is, that "limited government" or "less regulation" means "no government or "no regulation." Quite to the contrary, Friedman argues for a very clear and specific role for government in regulating natural monopolies, enforcing contracts, and taking many other actions to make sure that markets function openly. He clearly embraces regulation with the stipulation that when employed the benefits exceed the costs. And there's the rub with many government programs (say, agriculture subsidies): they favor entrenched interests rather than the commonwealth. His arguments about free trade convince me that it is the best way to help the poor in the world. I've read that the annual subsidy for one cow in Belgium rivals the annual salary of an African subsistence farmer. Take down that trade barrier benefiting the rich Belgian cow owner, and that farmer suddenly has a chance to present his goods on a world market. My point is, if you care about the poor, and if you care about social justice and all that, this might just be a crazy (and, for a change, effective) way to go. I don't fully agree with some of the book's policy prescriptions regarding environmental, education or monetary policy, but I suggest that Friedman's thoughts, formulated in the 1970s and published first in 1980, are far more likely to be successful than current ideas like "common core" or "quantitative easing." Overall, this is a thought-provoking read no matter what your political stripe is. Check it out.

Pure intelligence. Most articulate defense of free markets, individual liberty, unfettered entrepreneurialism, and "The American Way" that I have ever encountered. Reagan may have been the great missionary of free markets and deregulation, but Friedman was undoubtedly the high priest. The greatest testament to the prescience of this book is that most of Milton's ideas have generally become conventional wisdom in the past quarter century. The past 25 years have been an unquestionable vindication for Milton's theses- the US has experienced unparalled growth and low inflation due to pruning of Governnment bureaucracies and disciplined monetary policy, respectively. This economic "utopia" should come as no surprise; Friedman presents a plethora of anecdotal and empirical evidence for the problems that inevitably arise absent favorable regulatory and monetary conditions. I wish someone had given me this book in high school while I was being inundated with neoliberal nonsense: "uneven distribution of wealth" and a "market failure" caused the depression, rather than lousy monetary policy. Friedman demonstrates that the MARKET had historically provided its own liquidity (e.g., during the Panic of 1907), and that subsequent to outsourcing this function to the Fed, the government dropped the ball in the early '30s by tightening the money supply. Alternatively, Fed Chairman Arthur F. Burns (under pressure from Nixon and others), pursued monetary policy that was far too easy in the 1970s, causing double digit inflation. Thank goodness we have had a succession of competent Fed Chairmen since 1979 (Volcker, Greenspan, and Bernanke) committed to keeping inflation in check. Friedman also examines the effects of negative externalities (i.e., pollution) and presents a market-oriented approach to managing them, namely emissions trading. (want to feasibly address global warming?) The main objections to Friedman's theses may arise from those who believe that the global economy is too unfair to American workers. Well, I have news for you- if you're looking for a panacea of lifetime job security and a static competitive environment, you're on the wrong planet. Sorry, there is no "conspiracy" or covert "war on the middle class", it's simply global competition. Your vote is not going to change the inexorable integration of world markets. Get over it. The real challenge for American workers is how to (cost effectively) equip ourselves to compete in a global 21st century economy. Let's not hoist the flag of protectionism and promote class warfare. Instead, let's place some stock in ourselves and practice personal accountability. Friedman's suggestions for improving the quality of our schools is a good place to start. I also highly recommend Peter Bernstein's "The Power of Gold" for a good overview of world monetary history.

Okay, first of all, this is a different kind of book. Although Milton Friedman is known as an economist, he's actually much more than that...his writings weave together ideas on morality, politics, freedom, liberty - and of course, a strong underpinning of economics. But somehow, he manages to do this weaving in a relatively effortless way, so that you see the connection from natural law and economics all the way up. I find his approach markedly different from, say, a Paul Krugman - who seems to start with a preconceived idea of what results he wants to have, and then he tries to connect it to the economics...he (and others like him) always seem to be making convoluted, contorted cases that really don't bear close scrutiny. Milton Friedman, on the other hand, seems able to connect the dots with clarity, and you come away feeling that rather than expressing opinions, he's almost revealing sacred and irrefutable truths. The book is a close cousin to a 1980's PBS TV series of the same name - also available on DVD (some - but not all - of it is also available on Google Video). The TV series was gripping in its day, although even though much of the content is identical, the book has somewhat of a different and to me, more authoritative "feel". Still, if you like the book, I highly recommend viewing the TV series as well. It was updated in the early 1990s with each section narrated by some big names in entertainment and politics, including Ronald Reagan. As for the content of the book, it's hard to find fault with any of it, and it remains as applicable today as when it was first written 30 years ago. In that way, it's similar to Adam Smith and others that wrote about some of these same ideals hundreds of years ago, yet they remain eerily relevant, even today. The book speaks about the power of the free market and the tyranny socialism leads to. Pity that our leaders (and fellow Americans) refuse to learn these lessons. This is one book that should be required reading for all Americans.

The authors-- a Nobel Prize winning economist and his wife-- present a well-written, accessible introduction to laissez-faire capitalism. Importantly, they refute the idea that libertarianism is solely about promoting the selifsh interests of the upper class and socialism/progressivism is solely about promoting the selfless interests of the lower class. Instead, the authors show that government regulations can have malign intended and unintended side effects. In a powerful passage, the authors argue that black Americans are doubly failed by progressivism: first, they are forced to attend failing government schools and second, they are unable to find employment because of minimum wage laws and licensing requirements. The authors are very convincing on some issues, particularly school choice. But on other issues, particularly health care and old age pensions, I found their arguments wanting. Regarding health care, the very country that the authors point to as a laissez-faire model (Hong Kong) has a socialized medical system. And regarding pensions, much of their argument hinges on the "philosophical" idea of non-coercion.

Below are key excerpts from the book that I found particularly insightful: 1- "Economic freedom is an essential requisite for political freedom. By enabling people to cooperate with one another without coercion or central direction, it reduces the area over which political power is exercised. In addition, by dispersing power, the free market provides an offset to whatever concentration of political power may arise. The combination of economic and political power in the same hands is a sure recipe for tyranny." 2- "The experience of recent years--slowing growth and declining productivity--raises a doubt whether private ingenuity can continue to overcome the deadening effects of government control if we continue to grant ever more power to government, to authorize a "new class" of civil servants to spend ever larger fractions of our income supposedly on our behalf. Sooner or later--and perhaps sooner than many of us expect--an ever bigger government would destroy both the prosperity that we owe to the free market and the human freedom proclaimed so eloquently in the Declaration of Independence." 3- "Prices perform three functions in organizing economic activity: first, they transmit information; second, they provide an incentive to adopt those methods of production that are least costly and thereby use available resources for the most highly valued purposes; third, they determine who gets how much of the product - the distribution of income. These three functions are closely interrelated." 4- "Our society is what we make it. We can shape our institutions. Physical and human characteristics limit the alternatives available to us. But none prevents us, if we will, from building a society that relies primarily on voluntary cooperation to organize both economic and other activity, a society that preserves and expands human freedom, that keeps government in its place, keeping it our servant and not letting it become our master." 5- "The ballot box produces conformity without unanimity; the marketplace, unanimity without conformity. That is why it is desirable to use the ballot box, so far as possible, only for those decisions where conformity is essential." 6- "Freedom cannot be absolute. We do live in an interdependent society. Some restrictions on our freedom are necessary to avoid other, still worse, restrictions. However, we have gone far beyond that point. The urgent need today is to eliminate restrictions, not add to them." 7- "In one respect the System has remained completely consistent throughout. It blames all problems on external influences beyond its control and takes credit for any and all favorable occurrences. It thereby continues to promote the myth that the private economy is unstable, while its behavior continues to document the reality that government is today the major source of economic instability." 8- "The waste is distressing, but it is the least of the evils of the paternalistic programs that have grown to such massive size. Their major evil is their effect on the fabric of our society. They weaken the family; reduce the incentive to work, save, and innovate; reduce the accumulation of capital; and limit our freedom. . These are the fundamental standards by which they should be judged." 9- "A society that puts equality--in the sense of equality of outcome--ahead of freedom will end up with neither equality nor freedom. The use of force to achieve equality will destroy freedom, and the force, introduced for good purposes, will end up in the hands of people who use it to promote their own interests...Freedom means diversity but also mobility. It preserves the opportunity for today's disadvantaged to become tomorrow's privileged and, in the process. enables almost everyone, from top to bottom, to enjoy a fuller and richer life." 10- "We believe that the growing role that government has played in financing and administering schooling has led not only to enormous waste of taxpayers' money but also to a far poorer educational system than would have developed had voluntary cooperation continued to play a larger role...We have tried in this chapter to outline a number of constructive suggestions...These proposals are visionary but they are not impracticable...We shall not achieve them at once. But insofar as we make progress toward them--or alternative programs directed at the same objective--we can strengthen the foundations of our freedom and give fuller meaning to equality of educational opportunity." 11- "Insofar as the government has information not generally available about the merits or demerits of the items we ingest or the activities we engage in, let it give us the information. But let it leave us free to choose what chances we want to take with our own lives." 12- "When unions get higher wages for their members by restricting entry into an occupation, those higher wages are at the expense of other workers who find their opportunities reduced. When government pays its employees higher wages, those higher wages are at the expense of the taxpayer. But when workers get higher wages and better working conditions through the free market, when they get raises by firms competing with one another for the best workers, by workers competing with one another for the best jobs, those higher wages are at nobody's expense. They can only come from higher productivity, greater capital investment, more widely diffused skills." 13- "Five simple truths embody most of what we know about inflation: 1. Inflation is a monetary phenomenon arising from a more rapid increase in the quantity of money than in output (though, of course, the reasons for the increase in money may be various) 2. In today's world government determines--or can determine -the quantity of money. 3. There is only one cure for inflation: a slower rate of increase in the quantity of money. 4. It takes time--measured in years, not months--for inflation to develop; it takes time for inflation to be cured. 5. Unpleasant side effects of the cure are unavoidable." 14- "We have been misled by a false dichotomy: inflation or unemployment. That option is an illusion. The real option is only whether we have higher unemployment as a result of higher inflation or as a temporary side effect of curing inflation." 15- "The two ideas of human freedom and economic freedom working together came to their greatest fruition in the United States. Those ideas are still very much with us. We are all of us imbued with them. They are part of the very fabric of our being. But we have been straying from them. We have been forgetting the basic h that the greatest threat to human freedom is the concentration of power, whether in the hands of government or anyone else. We have persuaded ourselves that it is safe to grant power, provided it is for good purposes."

So far, love it!

This classic work by Friedman is incredibly clear and concise. It is a must read for every American. This is not a read from the standpoint of the fundamentals of economic law that you will find in Thomas Sowell’s “Basic Economics”, nor technical economic analysis or econometrics that you will find in many other economic textbooks. Rather, Friedman offers economics from a more philosophical perspective. Friedman demonstrates the relationship between economics and politics and how they affect our freedom. He stresses throughout how shifting economic power away from the people puts the balance of power in the hands of the political. Each chapter is perfectly organized and he gives excellent concrete examples - no stone is left unturned. That said, the main takeaway regarding the overarching purpose of this book - and what this book seems to do best - is assess what the role of government is, and exactly how (and why) the government should or should not interfere in the economy. Friedman also offers '"cures" for the economic "cancers" that harm us today, which are still more relevant than ever. This book pairs perfectly with Thomas Sowell’s “Basic Economics”. This one being more philosophical and the latter more technical.

Excellent. Spot on economics & human psychology book. The authors does not make theological assumptions but based all his arguments on example of human behavior

O livro apresenta de modo muito didático, analisando cada faceta da economia e do governo, as vantagens do sistema capitalista em contraposição ao socialismo.

Government overspending and virtual money printing are the main drivers of inflation. Giving historical examples from the US, Japan, and other countries, Milton Friedman and his wife offer clear and concise explanations of the causes of inflation and the disastrous, long term effects on citizens. Excellent primer for anyone who wants to cut through the often superficial reporting offered in the mainstream media and the disingenuous comments made by politicians.

This book met my goals at a large extent. I’d recommend it to everyone who wants to have an overview about the benefits of free market for whatever the thing. Based on data and experiences, the book shows that free market is, all in all, a better option than regulation or nationalisation of property/activity.

If you like economics this is extremely good book I really enjoyed reading it