Milton Friedman: A Personal Remembrance
I first
met Milton Friedman in 1990. It was at his apartment in a high-rise in
Russian Hills, San Francisco. Two of the walls were floor-to-ceiling
glass, revealing a view of the city so spectacular it took my breath
away. Rose Friedman, his wife and collaborator over a long life,
exclaimed, “We paid for it!”
It had
never occurred to me to ask exactly what they had paid for it, but I
was curious. Mrs. Friedman explained, “We spent thirty years in
Chicago!”
That
they had. The price they paid also included a short stay at the
University of Minnesota.
Milton
Friedman quickly learned that I was a disciple of Ragnar Frisch, the
Norwegian economist who had won the first Nobel Prize in economics
(1969), and who was probably Friedman’s opposite, emphasizing government
planning and intervention. Frisch’s award had been a popular choice,
and Mr. Friedman’s was not. “They threw rotten tomatoes at me in
Stockholm in 1976,” Dr. Friedman said gleefully, and I recognized his
combative temperament as well as his grace in acknowledging my somewhat
different background.
We
talked. I had come to invite him to Kuala Lumpur to address the World
Productivity Congress as a keynote speaker. He said he was much too
busy. I said, “I’ve noticed that the Chinese are productive all over
the world except in China, and that the Cubans are productive everywhere
except in Cuba. This is also true of the Russians and the East Germans
and the Indians. Could you comment on that?”
Professor Milton Friedman ignited. “It’s the system!” he shouted.
“It’s the lack of freedom! It’s the heavy-handed and uninformed
intervention of government!”
I knew I had struck a nerve. I had viewed his famous
television series, Free to Choose, and marveled at
his ability to persuade and to make the case for economic
freedom. I also remembered his 1962 book, Capitalism and
Freedom, as a milestone in economics. The Congress
where I wanted him to speak would have high-ranking Chinese,
Indians and Swedes (!) attending. Mr. Friedman could throw
a few tomatoes of his own.
The
conversation ranged from the pitfalls of economic development to the
unexpected recent choices of Nobel Laureates in economics, many from his
own University of Chicago, (“Some of them, I’ve never heard about!”). We
talked about how economics distances itself from the general public by
the use of arcane mathematics and statistics. We discussed his opinions
on Africa (“Endemic corruption and no transparency.”), Latin America (“I
have hopes for Chile.”), Europe (“Their welfare economies may lead to
stagnation.”), the Asian Tigers (“Hong Kong is the lighthouse to their
future.”), and how the Great Depression in the U.S. was a monetary
calamity. |
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In
the end, this diminutive man stepped up, shook my hand, and
promised to appear, via AT&T satellite, at the
Congress. And he did.
He appeared on a screen so large that he towered over the
audience. For the first time, he had a visible physical
stature equaling his mental stature. In his hand, he held a
simple pencil.
He explained how this pencil had been created by people
totally unaware of each other but brought together by the
magic of free markets: The wood from distant forests, the
graphite from distant mines, the eraser from Indonesian
rubber, the metal from another mine – all shipped great
distances. All came together in the production of a
low-cost item used by school children all over the world.
It was free trade and markets that had made this little
miracle possible. “Let us now see,” he said, “how these
ideas may transform the world.”
Dr. Curt Nicolin, the famous industrialist from Sweden, was
in the audience and listening carefully to Dr. Friedman’s
message. He came up to me immediately after the
presentation. “We must have this Congress in Sweden!” he
exclaimed.
“No more tomatoes?” I asked.
He laughed. “We shall only focus on free markets.”
And that they did. After the 1993 World Productivity
Congress, hosted in Stockholm, Sweden went from last to
first in manufacturing productivity among the fourteen
developed countries Sweden uses for comparison. The theme
of the Congress was, indeed, free markets.
China was also represented at these Congresses. So it was
that in 2001, China hosted the twelfth World Productivity
Congress, scarcely a month after 9/11/01, demonstrating that
Milton Friedman’s ideas had helped create the most
productive economy in the world —although with some distance
still to go on the issues of freedom and transparency.
This is a small example of the force of Friedman’s economic
ideas. That afternoon, in an apartment with stunning views,
Milton Friedman mentally prepared a presentation that I
believed would change the course of many countries for the
better. No economist could wish for more. And no country
should ignore his message.
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