Milton Friedman vs Socialism

by drclarkjensen on May 11, 2012

Milton Friedman

If you have a half an hour to listen to  Milton Friedman, here is a link to a CSPAN interview  from 1994 that you will find to be very interesting.

I am a Friedman fan.  I first became acquainted with Friedman through his book Free to Choose while I was in professional school in 1983 or 1984.  I have been a fan of his since that time.   The Friedman interview starts with a discussion about F. A.  Hayek (another economist hero of mine).

(I pay as much attention to economists, probably, as I do to political thinkers because I believe that freedom in the economic sphere is foundational to all other freedoms.  If our right to pursue happiness (own, keep and protect property) is not kept inviolate, no other freedom is safe.)

During the interview, Mr Friedman makes an interesting statement.  He says that socialism has been proven to be a failure, time and time again, while capitalism has been proven to be a great benefit to the people, time and time again.  Then he goes on to say that in spite of the failure of socialism, governments-the world over- are moving increasingly towards socialism.  He is right.  Let’s talk about socialism.  I don’t remember ever talking about socialism in the way we are going to discuss it today.

What is socialism?  How would you define it?  According to Wikipedia socialism is defined as “an economic system characterized by social ownership and control of production and co-operative management of the economy.”

Okay, but what does that mean?  It means that with socialism property is not owned by the individual but by the society.  Some people would say that is a good idea.  They would say that Jesus Christ would want us to love each other and share everything.  So why all the opposition to socialism by all those hard hearted conservatives?

Friedman answers that question.  In the above mentioned interview he says that socialism creates a society that is less safe and less prosperous for the society as a whole.  Socialism destroys the quality of goods and services and the economy of everything it touches whether it is medicine, education or industry in general.  Socialism is not compassionate.  It does not help the poor in spite of all the rhetoric to the contrary.

Friedman uses this example.  He explains that currently our educational system is the most socialized part of our government and our economy in the United States today.  He explains that when he was a young man he was able to obtain a college education because of his high score on a scholarship test.  He received that scholarship at a time when socialism had not invaded the educational system like it has today.

He then said that today’s scholarships are not given to those who are the most able, but those who are the least able.  Socialism, instead of rewarding competence, rewards incompetence.  It tries to elevate society from the bottom up.  Friedman then states, “no social progress has ever come from the bottom up”.

As our education system has become more and more socialized (more controlled by the federal government, less controlled by the states and the people) the quality of education has declined.  Socialism is killing the quality of education in the United States.  Between the NEA (National Education Association) and the Department of Education, the quality of the educational experience continues to fall for our children- compared to other nations, in spite of the fact that we spend more money on education than any other nation in the world.

Similarly as government (social ownership) has increased and individual or private sector ownership and control have decreased the quality of our healthcare system has also been negatively affected.

Friedman mentions in the interview that in 1928 10-15% of the economy was controlled by government while roughly 85% of the economy was controlled by the private sector but today (1994) the government controls over half of the economy.   He then says that even though the standard of living has improved over the years, the innovations that have improved our standard of living have come from the private sector, not from government and, he states, the people were safer and more secure in 1928 than they are today(1994).

Go listen to this interview.  It will be time well spent.  Friedman’s perspective is worth paying attention to.

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