Milton Friedman · 368 pages
Rating: (6K votes)
“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 firm 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. The whole pie is bigger - there's more for the worker, but there's also more for the employer, the investor, the consumer, and even the tax collector.
That's the way the free market system distributes the fruits of economic progress among all people. That's the secret of the enormous improvements in the conditions of the working person over the past two centuries.”
“For example, the supporters of tariffs treat it as self-evident that the creation of jobs is a desirable end, in and of itself, regardless of what the persons employed do. That is clearly wrong. If all we want are jobs, we can create any number--for example, have people dig holes and then fill them up again, or perform other useless tasks. Work is sometimes its own reward. Mostly, however, it is the price we pay to get the things we want. Our real objective is not just jobs but productive jobs--jobs that will mean more goods and services to consume.”
“There is no place for government to prohibit consumers from buying products the effect of which will be to harm themselves”
“The combination of economic and political power in the same hands is a sure recipe for tyranny.”
“The ICC [Interstate Commerce Commission] illustrates what might be called the natural history of government intervention. A real or fancied evil leads to demands to do something about it. A political coalition forms consisting of sincere, high-minded reformers and equally sincere interested parties. The incompatible objectives of the members of the coalition (e.g., low prices to consumers and high prices to producers) are glossed over by fine rhetoric about “the public interest,” “fair competition,” and the like. The coalition succeeds in getting Congress (or a state legislature) to pass a law. The preamble to the law pays lip service to the rhetoric and the body of the law grants power to government officials to “do something.” The high-minded reformers experience a glow of triumph and turn their attention to new causes. The interested parties go to work to make sure that the power is used for their benefit. They generally succeed. Success breeds its problems, which are met by broadening the scope of intervention. Bureaucracy takes its toll so that even the initial special interests no longer benefit. In the end the effects are precisely the opposite of the objectives of the reformers and generally do not even achieve the objectives of the special interests. Yet the activity is so firmly established and so many vested interests are connected with it that repeal of the initial legislation is nearly inconceivable. Instead, new government legislation is called for to cope with the problems produced by the earlier legislation and a new cycle begins.”
“In the past century a myth has grown up that free market capitalism—equality of opportunity as we have interpreted that term—increases such inequalities, that it is a system under which the rich exploit the poor. Nothing could be further from the truth. Wherever the free market has been permitted to operate, wherever anything approaching equality of opportunity has existed, the ordinary man has been able to attain levels of living never dreamed of before. Nowhere is the gap between rich and poor wider, nowhere are the rich richer and the poor poorer, than in those societies that do not permit the free market to operate. That is true of feudal societies like medieval Europe, India before independence, and much of modern South America, where inherited status determines position. It is equally true of centrally planned societies, like Russia or China or India since independence, where access to government determines position. It is true even where central planning was introduced, as in all three of these countries, in the name of equality.”
“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. On the other hand, a society that puts freedom first will, as a happy by-product, end up with both greater freedom and greater equality. Though a by-product of freedom, greater equality is not an accident. A free society releases the energies and abilities of people to pursue their own objectives. It prevents some people from arbitrarily suppressing others. It does not prevent some people from achieving positions of privilege, but so long as freedom is maintained, it prevents those positions of privilege from becoming institutionalized; they are subject to continued attack by other able, ambitious people. 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.”
“Believers in aristocracy and socialism share a faith in centralized rule, in rule by command rather than by voluntary cooperation.”
“The smaller the unit of government and the more restricted the functions assigned government, the less likely it is that its actions will reflect special interests rather than the general interest.”
“No one can disagree with the objectives of the legislation that culminated in the 1962 amendments. Of course it is desirable that the public be protected from unsafe and useless drugs. However, it is also desirable that new drug development should be stimulated, and that new drugs should be made available to those who can benefit from them as soon as possible. As is so often the case, one good objective conflicts with other good objectives. Safety and caution in one direction can mean death in another.”
“The harm done by the FDA does not result from defects in the people in charge—unless it be a defect to be human. Many have been able and devoted civil servants. However, social, political, and economic pressures determine the behavior of the people supposedly in charge of a government agency to a far greater extent than they determine its behavior. No doubt there are exceptions, but they are rare—almost as rare as barking cats. That does not mean that effective reform is impossible. But it requires taking account of the political laws governing the behavior of government agencies, not simply berating officials for inefficiency and waste or questioning their motives and urging them to do better. The”
“Children are responsible individuals in embryo. They have ultimate rights of their own and are not simply the playthings of their parents.”
“We now know, as a few knew then, that the depression was not produced by a failure of private enterprise, but rather by a failure of government in an area in which the government had from the first been assigned responsibility—-"To coin money, regulate the Value thereof, and of foreign Coin," in the words of Section 8, Article 1, of the U.S. Constitution. Unfortunately, as we shall see in Chapter 9, government failure in managing money is not merely a historical curiosity but continues to be a present-day reality.”
“I can understand the teachers saying it’s a gun at my head, but they’ve got the same gun at the parents’ head at the moment. The parent goes up to the teacher and says, well, I’m not satisfied with what you’re doing, and the teacher can say, well tough. You can’t take him away, you can’t move him, you can’t do what you like, so go away and stop bothering me. That can be the attitude of some teachers today, and often is. But now that the positions are being reversed [with vouchers] and the roles are changed, I can only say tough on the teachers. Let them pull their socks up and give us a better deal and let us participate more.”
“Only people have incomes and they derive them through the market from the resources they own, whether these be in the form of corporate stock, or of bonds, or of land, or of their personal capacity.”
“Although these examples only scratch the surface, they illustrate the fundamental proposition that freedom is one whole, that anything that reduces freedom in one part of our lives is likely to affect freedom in the other parts.”
“Every special group around the country tries to get its hands on whatever bits and pieces it can. The result is that there is hardly an issue on which government is not on both sides. For example, in one massive building in Washington some government employees are working full-time trying to devise and implement plans to spend our money to discourage us from smoking cigarettes. In another massive building, perhaps miles away from the first, other employees, equally dedicated, equally hard-working, are working full-time spending our money to subsidize farmers to grow tobacco.”
“Nor do the spokesmen for these organizations ever explain why, if the public school system is doing such a splendid job, it needs to fear competition from nongovernmental, competitive schools or, if it isn’t, why anyone should object to its “destruction.”
“Currently, the only widely available alternative to a local public school is a parochial school. Only churches have been in a position to subsidize schooling on a large scale and only subsidized schooling can compete with “free” schooling. (Try selling a product that someone else is giving away!) The voucher plan would produce a much wider range of alternatives—unless it was sabotaged by excessively rigid standards for “approval.” The choice among public schools themselves would be greatly increased. The”
“The threat to public schools arises from their defects, not their accomplishments. In small, closely knit communities where public schools, particularly elementary schools, are now reasonably satisfactory, not even the most comprehensive voucher plan would have much effect. The public schools would remain dominant, perhaps somewhat improved by the threat of potential competition. But elsewhere, and particularly in the urban slums where the public schools are doing such a poor job, most parents would undoubtedly try to send their children to nonpublic schools.”
“The widespread enthusiasm for reducing government taxes and other impositions is not matched by a comparable enthusiasm for eliminating government programs—except programs that benefit other people. The”
“On the contrary, the inflation itself is partly a response to the reaction. As it has become politically less attractive to vote higher taxes to pay for higher spending, legislators have resorted to financing spending through inflation, a hidden tax that can be imposed without having been voted, taxation without representation. That is no more popular in the twentieth century than it was in the eighteenth.”
“There is all the difference in the world, however, between two kinds of assistance through government that seem superficially similar: first, 90 percent of us agreeing to impose taxes on ourselves in order to help the bottom 10 percent, and second, 80 percent voting to impose taxes on the top 10 percent to help the bottom 10 percent—William Graham Sumner's famous example of B and C deciding what D shall do for A.”
“(4) The racial issue. Voucher plans were adopted for a time in a number of southern states to avoid integration. They were ruled unconstitutional. Discrimination under a voucher plan can be prevented at least as easily as in public schools by redeeming vouchers only from schools that do not discriminate. A more difficult problem has troubled some students of vouchers. That is the possibility that voluntary choice with vouchers might increase racial and class separation in schools and thus exacerbate racial conflict and foster an increasingly segregated and hierarchical society. We believe that the voucher plan would have precisely the opposite effect; it would moderate racial conflict and promote a society in which blacks and whites cooperate in joint objectives, while respecting each other's separate rights and interests. Much objection to forced integration reflects not racism but more or less well-founded fears about the physical safety of children and the quality of their schooling. Integration has been most successful when it has resulted from choice, not coercion. Nonpublic schools, parochial and other, have often been in the forefront of the move toward integration.”
“Let schools specialize, as private schools would, and common interest would overcome bias of color and lead to more integration than now occurs. The integration would be real, not merely on paper. The voucher scheme would eliminate the forced busing that a large majority of both blacks and whites object to. Busing would occur, and might indeed increase, but it would be voluntary—just as the busing of children to music and dance classes is today. The failure of black leaders to espouse vouchers has long puzzled us. Their constituents would benefit most. It would give them control over the schooling of their children, eliminate domination by both the city-wide politicians and, even more important, the entrenched educational bureaucracy. Black leaders frequently send their own children to private schools. Why do they not help others to do the same? Our tentative answer is that vouchers would also free the black man from domination by his own political leaders, who currently see control over schooling as a source of political patronage and power. However, as the educational opportunities open to the mass of black children have continued to deteriorate, an increasing number of black educators, columnists, and other community leaders have started to support vouchers. The Congress of Racial Equality has made the support of vouchers a major plank in its agenda.”
“As these remarks indicate, the Social Security program involves a transfer from the young to the old. To some extent such a transfer has occurred throughout history—the young supporting their parents, or other relatives, in old age. Indeed, in many poor countries with high infant death rates, like India, the desire to assure oneself of progeny who can provide support in old age is a major reason for high birth rates and large families. The difference between Social Security and earlier arrangements is that Social Security is compulsory and impersonal—earlier arrangements were voluntary and personal. Moral responsibility is an individual matter, not a social matter. Children helped their parents out of love or duty. They now contribute to the support of someone else’s parents out of compulsion and fear. The earlier transfers strengthened the bonds of the family; the compulsory transfers weaken them.”
“The question that has perhaps divided students of vouchers more than any other is their likely effect on the social and economic class structure. Some have argued that the great value of the public school has been as a melting pot, in which rich and poor, native- and foreign-born, black and white have learned to live together. That image was and is largely true for small communities, but almost entirely false for large cities. There, the public school has fostered residential stratification, by tying the kind and cost of schooling to residential location. It is no accident that most of the country’s outstanding public schools are in high-income enclaves.”
“The drive for equality failed for a much more fundamental reason. It went against one of the most basic instincts of all human beings. In the words of Adam Smith, "The uniform, constant, and uninterrupted effort of every man to better his condition"9—and, one may add, the condition of his children and his children's children. Smith, of course, meant by "condition" not merely material well-being, though certainly that was one component. He had a much broader concept in mind, one that included all of the values by which men judge their success—in particular the kind of social values that gave rise to the outpouring of philanthropic activities in the nineteenth century.”
“When the law interferes with people's pursuit of their own values, they will try to find a way around. They will evade the law, they will break the law, or they will leave the country. Few of us believe in a moral code that justifies forcing people to give up much of what they produce to finance payments to persons they do not know for purposes they may not approve of. When the law contradicts what most people regard as moral and proper, they will break the law—whether the law is enacted in the name of a noble ideal such as equality or in the naked interest of one group at the expense of another. Only fear of punishment, not a sense of justice and morality, will lead people to obey the law.”
“One feature of the voucher plan that has aroused particular concern is the possibility that parents could and would "add on" to the vouchers. If the voucher were for, say, $1,500, a parent could add another $500 to it and send his child to a school charging $2,000 tuition. Some fear that the result might be even wider differences in educational opportunities than now exist because low-income parents would not add to the amount of the voucher while middle-income and upper-income parents would supplement it extensively.”
“each generation has to create the image of God that works for it.”
“To find one's special quality
One must lead a life of deep humility.
To serve in this way
Never question but obey
Is the blessing of St Aggie's charity.
- The owls of St. Aegolius”
“Reading without thinking is as nothing, for a book is less important for what it says than for what it makes you think.”
“No one imagines keeping the powerful low for long, apart from anything because if the peasants governed and the lords worked the land, everyone would quickly die of hunger, because everyone gets the hands they deserve.”
“Mr. Smith yelled at the doctor,
What have you done to my boy?
He's not flesh and blood,
he's aluminum alloy!"
The doctor said gently,
What I'm going to say
will sound pretty wild.
But you're not the father
of this strange looking child.
You see, there still is some question
about the child's gender,
but we think that its father
is a microwave blender.”
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