HE RESTS, HIS LEGACY CAN'T

Conservatives Should Do Milton Friedman's Unfinished Business

Shell-shocked conservatives should embrace the unfinished agenda of a
five-foot-tall free-market giant. Milton Friedman -- 1976's Nobel
economics laureate, and both an elevated theorist and fathomable
popularizer of capitalist ideas -- passed away November 16 at age 94.
The Hoover Institution senior research fellow leaves behind the PBS
series Free to Choose, some 25 books, and hundreds of articles, much
of this co-produced with Rose, his wife of 68 years. Thousands of
academics and think-tank scholars -- inspired by his faith in
individual liberty, limited government, and private enterprise --
advance his philosophy of human freedom.

Friedmanites will be relieved to know that he did not vanish into a
thick, dark fog. He was lucid until the end.

"I was with him on October 31, the day before he was hospitalized"
the Vancouver-based Fraser Institute's Michael Walker -- a family
friend of nearly 40 years -- said just hours after Friedman's
passage. "Milton, Rose, and I were discussing the Milton and Rose D.
Friedman Foundation in their San Francisco apartment with Gordon St.
Angelo, the foundation's president. Milton sat in bed because he was
more comfortable that way, given the back injury he sustained in a
fall a few days before."

"During our meeting, we had a sidebar debate about 'naked short
selling' -- a process in which a stock is sold short without the
cover of borrowed stock." Walker said at a November 16 Atlas Economic
Research Foundation dinner at the Willard Hotel in Washington, D.C.
"He was, in this discussion and in all of our other business, as
sharp and as engaged as he was the first time I met him. In effect,
he was like a light bulb that burned brilliantly, then went out all
at once," Walker added, snapping his fingers. "That's how he would
have wanted it."

"We all can take comfort in the fact that his light and his intellect
will shine forever through his ideas and their universal application
in the world."

Despite left-wing paranoia that President Bush would reinstate the
draft, incoming House Ways and Means chairman Charles Rangel (D.,
N.Y.) recently promised legislation to resurrect it. Conscription
vanished largely because Friedman helped convince President Nixon to
scrap it. This was among the Brooklyn-born,
University-of-Chicago-educated economist's proudest achievements. He
also successfully pushed monetary discipline, tax cuts, and free trade.

This impressive public-policy track record notwithstanding, many of
Friedman's concepts remain unimplemented. America should honor this
brilliant, endearing, and amazingly humble public intellectual by
enacting more of his ideas:

Friedman proposed school vouchers in 1955. Fifty-one years on,
students need this reform even more urgently. While there are strong
arguments for government to finance basic education -- to encourage
literacy, numeracy, and respect for basic American virtues -- there
is no reason the state must deliver these public goods. As Friedman
explained, the GI Bill of Rights funds higher education for veterans.
They freely redeem these vouchers at government-run (UCLA), private
(NYU), or religious (Brandeis) institutions.

"If present public expenditures on schooling were made available to
parents regardless of where they send their children," Friedman wrote
in 1962's Capitalism and Freedom, "a wide variety of schools would
spring up to meet the demand."

American school children, from the sandbox to the senior prom, should
be given, in essence, GI Bills for Kids. May a thousand
voucher-funded flowers bloom.

"Money is too important to be left to central bankers," Friedman told
me in a spring 2001 interview. "You essentially have a group of
unelected people who have enormous power to affect the economy."

Friedman long offered an elegantly simple alternative: "I've always
been in favor of replacing the Fed with a computer." A laptop could
calculate the monetary base and expand it annually -- through war,
peace, feast, and famine -- by, perhaps, a predictable 2 percent.

While it may be tough to criticize the Fed's recent performance --
excluding its 17 interest-rate hikes since 2004 that prompted today's
housing slump -- "people tend to forget that the long history of the
Fed is not one of success, but of failure," Friedman said. "The most
recent dramatic failure was in the 1970s, when you had the largest
inflation the U.S. has ever had in peacetime as the result of poor
monetary policy."

Of course, a laptop might ignore things like the late-1990s' dot.com
bust or Asian financial crisis. Friedman approved. "You sacrifice
this kind of appropriate fine-tuning for what fine-tuning generally
is, which is a mistake."

The federal government should abandon its disastrous War on
Marijuana, as Friedman soberly advocated.

"There is no logical basis for the prohibition of marijuana,"
Friedman once said. "It's absolutely disgraceful to think of picking
up a 22-year-old for smoking pot. More disgraceful is the denial of
marijuana for medical purposes."

"Dr. Friedman was a lifetime dues-paying member of the Marijuana
Policy Project and a strong advocate for ending marijuana
prohibition," MPP executive director Rob Kampia says. "He understood
that the government's war on marijuana users is an assault on basic
conservative values of freedom and small government. We will miss him greatly."

Friedman led some 530 economists who signed a communique encouraging
"an open and honest debate about marijuana prohibition." Their June
2005 letter continued: "We believe such a debate will favor a regime
in which marijuana is legal but taxed and regulated like other
goods." These economists cited a study by Harvard's Jeffrey R. Miron.
He calculated that ending marijuana prohibition would save taxpayers
$13.9 billion annually: $7.7 billion in foregone law-enforcement and
$6.2 billion in new tax receipts.

While he was a young, "thoroughly Keynesian" Treasury official,
Friedman promoted the withholding tax as a temporary, World War II
revenue-raiser. This may have been his biggest regret.

"It never occurred to me at the time that I was helping to develop
machinery that would make possible a government that I would come to
criticize...as too large, too intrusive, too destructive of freedom,"
Friedman wrote in Two Lucky People, his and Rose's memoir. "There is
an important lesson here. It is far easier to introduce a government
program than to get rid of it."

Rather than let Uncle Sam vacuum interest-free loans from workers'
paychecks, Americans should be free to send the Treasury monthly
checks, along with their rent and power bills. Transparent tax
collection likely would ignite a national tax revolt.

For a man awash in accolades, including the Presidential Medal of
Freedom that Ronald Reagan awarded him in 1988, Friedman was
incredibly modest. He could have been forgiven for having a swollen
head; instead, he was disarmingly unassuming.

He also was a bouyant optimist. Asked in late 1999 for words of
wisdom as the new millennium approached, Milton Friedman laughed and
told me: "The millennium will take care of itself."