friedman190.jpgMilton Friedman, famous economist and Nobel Prize laureate has died at 94.

Conservative and liberal colleagues alike viewed Mr. Friedman, a Nobel prize laureate, as one of the 20th century’s leading economic scholars, on a par with giants like John Maynard Keynes and Paul Samuelson.

Flying the flag of economic conservatism, Mr. Friedman led the postwar challenge to the hallowed theories of Lord Keynes, the British economist who maintained that governments had a duty to help capitalistic economies through periods of recession and to prevent boom times from exploding into high inflation.

In Professor Friedman’s view, government had the opposite obligation: to keep its hands off the economy, to let the free market do its work. He was a spiritual heir to Adam Smith, the 18th-century founder of the science of economics and proponent of laissez-faire: that government governs best which governs least.

The only economic lever that Mr. Friedman would allow government to use was the one that controlled the supply of money — a monetarist view that had gone out of favor when he embraced it in the 1950s. He went on to record a signal achievement, predicting the unprecedented combination of rising unemployment and rising inflation that came to be called stagflation. His work earned him the Nobel Memorial Prize in Economic Science in 1976.

Rarely, his colleagues said, did anyone have such impact on both his own profession and on government. Though he never served officially in the halls of power, he was always around them, as an adviser and theorist.

“Among economic scholars, Milton Friedman had no peer,” Ben S. Bernanke, the Federal Reserve chairman, said today. “The direct and indirect influences of his thinking on contemporary monetary economics would be difficult to overstate.”

Professor Friedman also fueled the rise of the Chicago School of economics, a conservative group within the department of economics at the University of Chicago. He and his colleagues became a counterforce to their liberal peers at the Massachusetts Institute of Technology and Harvard, influencing close to a dozen American winners of the Nobel prize in economics.

A long and interesting obituary in the NY Times. This was a man of influence; a giant (yet not such a tall man) whose ideas were considered, analyzed and often affected policy as well as the work of other economists.

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themiddle

9 Comments

  • ×™×—×™ זכרונו לברכה
    May this great man and great Jew be remembered for a blessing and may we try to bring his teachings on liberty to life in the State of Israel.

  • TM,

    You avoided comment on your own position on Friedman. Well, I can’t blame you. He is one of the most divisive figures. At family gatherings, we debate his merits and failings.

  • I didn’t comment because I feel somewhat hamstrung by my ignorance. For example, I would like to think that inflation isn’t such a bad thing that it deserves having the Fed drive the country into a recession, but lots of smart economists disagree. Who am I to say that I know better?

    I’ll take a stab at it anyway. Generally, I understand Friedman’s Libertarian views and can buy into them to some degree. However, I think he went too far for two reasons. One, government can be a strong tool for propping up the market when it is in trouble, and even when it isn’t helping the market, at least it can assist pockets within the country where there are no jobs and jobs can be “manufactured.” Two, privatization has not always worked and neither has deregulation. The idea of minimal government is appealling until you actually see its effects.

    I also think his ideas have contributed greatly to some ideas that Republicans have run with over the years in talking about smaller governments and lower taxes but then giving us bigger governments with overall lower taxes where the rate drops favor the wealthiest. He’s not directly responsible for that, but indirectly? Probably.

    At my family gatherings we do not discuss Milton Friedman, ever.

  • In my debates, the two schools of thought are frequently between those who say he goes to far, and those who say his ideas weren’t implemented properly. I have a solution: He went too far, AND his ideas weren’t implemented properly.

  • That’s a fair assessment on both counts. I think the irony is that the Republicans had control of both Houses and the Presidency and still didn’t come close to implementing his ideas correctly.

  • Kelsey,

    By far and away the best line I read today, exhibiting the twin virtues of being both funny and absolutely correct.

  • Friedman was really just an extension of late-1800s British… to hell with it, I can’t get these images of Kelsey family gatherings out of my head!

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