Milton Friedman

Who was he: Milton Friedman was an American economist and statistician, and recipient of the 1976 Nobel Prize in Economic Sciences.

As a leader of the Chicago School of Economics, Friedman exerted tremendous influence with respect to setting the research agenda of the entire profession. At the University of Chicago, Friedman became a vocal and influential advocate against activist Keynesian government policies and the teachings of John Maynard Keynes.

Friedman retired from teaching at the University of Chicago in 1977 and at the invitation of Glenn Campbell, Director of the Hoover Institution at Stanford University, became a Senior Research Fellow at Hoover. It is interesting to note that Friedman started out a Keynesian. He supported the New Deal policies and advocated government intervention in the economy. This, however, changed in the 1950s when he began reinterpreting the standard Keynesian model of that time.

Friedman's revised political thoughts emphasized the advantages of free-market economics and the disadvantages of government intervention and regulation. If asked, Friedman would probably describe his political philosophy as classically liberal and libertarian. His theories, teachings and writings have strongly influenced the opinions of American conservatives and libertarians. Friedman was an economic advisor to US President Ronald Reagan.

When one looks back at Milton Friedman's work today in light of increased libertarian awareness fostered by the Internet, it becomes obvious that the big issue is the lack of insight regarding central banking. Friedman's position on central banking and the Federal Reserve invalidates the rest of his credentials.

His view that the Fed could do a good job of money production if properly disciplined is most odd given the rest of his purported belief system. In the end, for anyone with honest libertarian credentials, Milton Friedman seems something of an apologist for the power elite and for mercantilist control over money. Indeed, that seems to have been his role.

Background: Milton Friedman was born July 31, 1912, in Brooklyn, New York. He was the fourth and last child of Sarah and Jeno Saul Friedman. He was also their first and only son. His parents emigrated to the US in their teens from Carpatho-Ruthenia (then a province of Austria-Hungary).

Milton Friedman moved to Rahway, NJ as an infant and grew up in a poor but warm and supportive household. He attended public elementary and secondary schools and graduated Rahway High School in 1928. Friedman attended Rutgers University on a scholarship and graduated in 1932. Although he specialized in mathematics, intending to become an actuary, Friedman soon became interested in economics and eventually graduated with the equivalent of a major in both fields.

Friedman was offered a scholarship by the Chicago Economics Department and indicates that it opened new worlds to him. While there Friedman met well known economists and brilliant graduate students from all over the world. It was there that he met a bright fellow economics student, Rose Director. She would become Friedman's wife six years later.

After completing a one-year fellowship at Columbia, Friedman returned to Chicago and spent a year as research assistant to Henry Schultz. In the summer of 1935, Friedman began work at the National Resources Committee on the design of a large consumer budget study that was already underway. Staying in Washington, Freidman then moved on to the National Bureau of Economic Research in the fall of 1937. This resulted in a jointly published work "Incomes from Independent Professional Practice," which also served as Friedman's doctoral dissertation from Columbia.

From there Milton Friedman spent 1941 to 1943 at the Treasury Department working on wartime tax policy and 1943-45 at Columbia working as a mathematical statistician on problems of weapons design, military tactics and metallurgical experiments. In 1946, Friedman accepted an offer from the University of Chicago to teach economic theory. Chicago became his intellectual home and the Chicago School of Economics grew in popularity as a result.

Beginning in the early 1960s, Friedman became increasingly drawn into politics. Friedman served as an economic adviser to Senator Barry Goldwater in his unsuccessful bid for the presidency in 1964. In 1968 he served on the committee of economic advisers during Richard Nixon's successful presidential bid.

Milton Friedman died on November 16th, 2006.

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