Far from acting as a stabilizer, the Federal Reserve failed to act as it should have in several circumstances. He discusses the evolution of money in America, culminating in the Federal Reserve Act of 1913. The government should also have control over money, as has long been recognized in the constitution and society. The Role of Government in a Free SocietyĪccording to the author, the government of a liberal society should enforce law and order and property rights, as well as take action on certain technical monopolies and diminish negative "neighborhood effects". Friedman states that economic freedom protects minorities from discrimination since the market is apathetic to "their views or color". Additionally, economic freedom is important, since any "bi-laterally voluntary and informed" transaction must benefit both parties to the transaction. He argues that, with the means for production under the auspices of the government, it is nearly impossible for real dissent and exchange of ideas to exist.
In this chapter, Friedman promotes economic freedom as both a necessary freedom and also as a vital means for political freedom. The Relation between Economic Freedom and Political Freedom Friedman opts for the continental European, rather than American, definition of the term.
The introduction lays out the principles of Friedman's archetypal liberal, a man who supports limited and dispersed governmental power. The book drew inspiration from a series of lectures Friedman gave in June 1956 at Wabash College. Capitalism and Freedom introduces the idea of how competitive capitalism can help to achieve economic freedom. This, as well as the New Deal, was supported by most intellectuals with the justification of Keynesian economics.
Both major parties, Democratic and Republican, supported increased spending in different ways. Under the Kennedy and preceding Eisenhower administrations, federal expenditures were growing at a quick pace in the areas of national defense, social welfare, and infrastructure. Among other concepts, Friedman advocates ending the mandatory licensing of physicians and introducing a system of vouchers for school education.Ĭapitalism and Freedom was published nearly two decades after World War II, a time when the Great Depression was still in collective memory. The book identifies several places in which a free market can be promoted for both philosophical and practical reasons. He defines " liberal" in European Enlightenment terms, contrasting with an American usage that he believes has been corrupted since the Great Depression. It has sold more than half a million copies since 1962 and has been translated into eighteen languages.įriedman argues for economic freedom as a precondition for political freedom. Capitalism and Freedom is a book by Milton Friedman originally published in 1962 by the University of Chicago Press which discusses the role of economic capitalism in liberal society.
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