A MAN WHO HATED GOVERNMENT

Conservative economic guru and liberal nemesis Milton Friedman hated
intervention of any sort, whether in the market or in recreational
drug use.

"Lord, enlighten thou our enemies," prayed 19th century British
economist and moral philosopher John Stuart Mill in his "Essay on
Coleridge." "Sharpen their wits, give acuteness to their perceptions,
and consecutiveness and clearness to their reasoning powers.

We are in danger from their folly, not from their wisdom: their
weakness is what fills us with apprehension, not their strength."

For every left-of-center American economist in the second half of the
20th century, Milton Friedman (1912-2006), Nobel Prize winner, founder
of the conservative "Chicago School" of economics and advisor to
Republicans from Goldwater to Reagan, was the incarnate answer to John
Stuart Mill's prayer.

His wits were sharp, his perceptions acute, his arguments strong, his
reasoning powers clear, coherent and terrifyingly quick. You tangled
with him at your peril.

And you left not necessarily convinced, but well aware of the weak
points in your own argument.

Gen. William Westmoreland, testifying before President Nixon's
Commission on an All-Volunteer [Military] Force, denounced the idea of
phasing out the draft and putting only volunteers in uniform, saying
that he did not want to command "an army of mercenaries." Friedman, a
member of the 15-person commission, interrupted him. "General,"
Friedman asked, "would you rather command an army of slaves?"
Westmoreland got angry: "I don't like to hear our patriotic draftees
referred to as slaves." And Friedman got rolling: "I don't like to
hear our patriotic volunteers referred to as mercenaries." And he did
not stop: " If they are mercenaries, then I, sir, am a mercenary
professor, and you, sir, are a mercenary general.

We are served by mercenary physicians, we use a mercenary lawyer, and
we get our meat from a mercenary butcher." As George Shultz liked to
say: "Everybody loves to argue with Milton, particularly when he isn't
there."

Thinking as hard as he could until he got to the root of the issues
was his most powerful skill. "Even at 94," wrote "Freakonomics" author
Steven Levitt, currently a professor in the same University of Chicago
economics department where Friedman taught from 1946 to 1976, "he
would teach me something about economics whenever we talked." In
Friday's New York Times, Chicago economist Austen Goolsbee quotes from
Milton Friedman's Nobel autobiography:

Friedman said that when he arrived [at the University of Chicago] in
the 1930s, he encountered a "vibrant intellectual atmosphere of a kind
that I had never dreamed existed."

"I have never recovered."

His worldview began with a bedrock belief in people and their ability
to make judgments for themselves, and thus an imperative to maximize
individual freedom.

On top of that was layered a trust in free markets as almost always
the best and most magical way of coordinating every conceivable task.
On top of that was layered a powerful conviction that a look at the
empirical facts -- a comparison, or a "marking to market," of one's
beliefs with reality -- would generate the right conclusions. And
crowning that was a fear and suspicion of government as an easily
captured tool for the enrichment of cynical and selfish interests.
Suffusing all was a faith in the power of argument and the primacy of
reason.

Friedman was an optimist.

He was convinced people could be taught the truths of economics, and
if people were properly taught, then institutions could be built to
protect society as a whole against the corruption and overreach of the
government.

And he did fear the government. He was a conservative of the old,
libertarian school, from the days before the scolds had captured the
levers of power in the conservative movement.

He hated any government intrusion into people's private
business.

And he interpreted "people's private business" extremely
widely.

He detested the war on drugs, which he saw as a cruel and destructive
breeder of crime and violence.

He scorned government licensing of professionals -- especially
doctors, who heard over and over again about how their incomes were
boosted by restrictions on the number of doctors that made Americans
sicker.

He abhorred deficit spending -- again, he was a conservative from
another era. He feared that cynical politicians could pretend that the
costs of government were less than they were by pushing the raising of
taxes to pay for spending off into the future.

He sought to inoculate citizens against such political games of
three-card monte. "Remember," he would say, "to spend is to tax."

This did not mean that government had no role to play. He endorsed the
enforcement of property rights, adjudication of contract disputes --
the standard and powerful rule-of-law underpinnings of the market --
plus a host of other government interventions when empirical
circumstances made them appropriate. Sometime empirical circumstances
could win Friedman some unexpected allies.

Left-wing Mayor Ken Livingstone's congestion tax on cars in central
London is an idea straight out of Milton Friedman. Friedman's negative
income tax is one of the parents of what is now America's largest
anti-poverty program: the earned-income tax credit, which was greatly
expanded by Bill Clinton. And, most important, government had a very
powerful and necessary role to play in keeping the monetary system
working smoothly through proper control of the money stock.

If there was always sufficient liquidity in the economy -- enough but
not too much -- then you could trust the market system to do its job.
If not, you got the Great Depression, or hyperinflation.

Prior to Friedman, the economic giant of the previous generation, John
Maynard Keynes, was an equally ferocious debater.

The Great Depression had convinced Keynes that central bankers alone
could not rescue and stabilize the market economy.

In Keynes' view, stronger and more drastic strategic interventions
were needed to boost or curb demand directly. Keynes was perhaps the
prime influence on U.S. liberals and U.S. economic policy up through
the Reagan era; Friedman worked tirelessly to supplant and minimize
his influence.

In their "Monetary History of the United States," Friedman and
coauthor Anna J. Schwartz argued that the Keynesian reliance on
intervention was a misreading of the lessons of the Depression.
Friedman did think that government was required to undertake
relatively narrow but crucial strategic interventions to stabilize the
macroeconomy -- keep production, employment and prices on an even
keel. But he believed the Depression might have been rapidly
alleviated by skillful monetary management alone.

Over the course of 40 years, Friedman's position carried the day, in a
few developing economies like Chile that have applied Chicago School
theories, and at home. Current Federal Reserve chairman Ben Bernanke
now holds Friedman's view, not Keynes', of what kind of strategic
interventions in the economy are necessary to provide for maximum
production, employment and purchasing power, and stable prices.

Friedman's thought is, I believe, best seen as the fusion of two
strong and very American currents: libertarianism and pragmatism.
Friedman was a pragmatic libertarian. He believed that -- as an
empirical matter -- giving individuals freedom and letting them
coordinate their actions by buying and selling on markets would
produce the best results.

It was not that he thought this was a natural law. He didn't believe
that markets always worked best. It was, rather, that he believed that
places where markets failed were atypical; that where markets failed
there were almost always enormous profit opportunities from
entrepreneurial redesign of institutions; and that the market system
would create new opportunities for trade that would route around
market failures. Most important, his distrust of government told him
that government failure was pervasive, and that any expansion of
government beyond the classical liberal state would be highly likely
to cause more trouble than it could solve.

For right-of-center American libertarians, Milton Friedman was a
powerful leader.

For left-of-center American liberals, Milton Friedman was an
enlightened adversary, and one whose view is now ascendant.

We are all the stronger for his work. We will miss him.