Friedman the Moderate

What I find most intriguing about Friedman is the fact that he was able to have such a substantial impact on public opinion and policy. When he began his career, free markets were widely regarded as outdated, even barbaric. In the span of a generation, this changed, due in no small part to Friedman's influence. I believe that the current generation of libertarians would do well to study his example to learn how it was that he was able to have so much influence, and whether we can do the same.

I don't pretend to have the answer to this question, but I would like to offer one hypothesis. Despite the reputation Friedman has on the left as a radical libertarian, there is an striking dearth among his policy recommendations of anything any reasonable leftist or moderate might find objectionable on normative grounds. Where radical libertarians argue for the abolition of public funding of education, Friedman dedicated much of the last decade of his life to the school choice movement. Where radical libertarians argue for the abolition of public welfare programs, Friedman inspired the Earned Income Tax Credit.

Now there is great merit to radical libertarianism. But I think there is also great merit to advocating, as Friedman did, more moderate improvements which are politically palatable enough to be implemented. The essence of Friedman's approach was to accept that the public would insist on using trying to use tax dollars to solve certain problems, and then find an economically sane way to do so---the latter, unfortunately, rarely being the first instinct of policymakers.

For example, school vouchers still require the government to take money from some people to fund the education of other people's children. But for the time being, the only realistic alternative is a government monopoly on primary and secondary education. Since we're stuck with the taxes, we should at least try to use those taxes as effectively as possible, and a voucher system is a far better solution than a public monopoly on education.

Likewise the Earned Income Tax Credit. Traditional welfare is an object lesson in perverse incentives, and the minimum wage amounts to a tax on the employment of unskilled labor. Even if we accept the normative proposition that helping the poor is an appropriate use of state coercion, these policies are made indefensible by their unintended consequences. An effective anti-poverty program must not create a disincentive for the poor to participate in the labor market or for employers to hire them. Traditional welfare and the minimum wage do, while the EITC does not.

In short, I suspect that, as libertarians, we may be able to do more to achieve our goal of a freer, more prosperous society by focusing our efforts on incremental improvements consistent with the norms of the public at large than we can by advocating radical and poltically unpalatable changes. Milton Friedman's legacy would seem to be a data point supporting this hypothesis.


Return to A Tribute to Milton Friedman

Share this