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lundi 16 janvier 2012

SELECTED BLOGS : THE GRUMPY ECONOMIST// DeLong on Friedmans and Freedoms



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MONDAY, JANUARY 16, 2012

DeLong on Friedmans and Freedoms

Brad DeLong put up a post on Milton and Rose Friedman's Free to Choose so succinct, so outrageous, and so revealing, it merits breaking the "Don't respond to Brad" rule. Here it is, in its entirety:
There are, I think two important things you should note when you start reading Friedman and Director Friedman's "Free to Choose". The first is that it was a book that was written 30 years ago. The second is that the Friedmans believed that they were fighting against the tide of history. They thought--in 1980--that liberty and prosperity were in retreat worldwide, and had been in retreat for at least fifty years."

This strikes us--this strikes me at least--as profoundly odd. When you ask me what "freedom" means, I tend to go back to Franklin Delano Roosevelt's four freedoms:
  • Freedom of speech
  • Freedom of religion
  • Freedom from want
  • Freedom from fear
When I think of major impingements on freedom, I don't think of the things that the Friedmans point to in 1980 as evidence that freedom is in retreat. I see 1980 as coming at the end of the fastest and most complete 50-year expansion of freedom, democracy, and prosperity the world had ever seen.
When you ask me what "freedom" means, I tend to go back to "life, liberty and the pursuit of happiness." Yes, indeed, freedom of speech and religion, and also the freedom  peaceably to assemble, and to petition my Government for a redress of grievances. The freedom to be secure in my person, houses, papers, (hard drive) and effects, against unreasonable searches and seizures. Due process when the Government accuses me of something or wants to confiscate my property. The freedom to own property, transact it as I see fit; the right voluntary to exchange property and labor with another. The freedom to travel, live, and work anywhere in the world.

"Freedom" means not being told by force what to do. In a peaceful society with functioning police and courts, in which private disputes are subject to the rule of law, the first and most important freedom is from government interference.

(Roosevelt was, by contrast, talking about a war. My complaint is with DeLong, not in this case with Roosevelt. "Freedom from want and fear" mean something different in the Warsaw ghetto than if we're talking about the social security inflation-adjustment formula. Brad uses this quote in the context of the Friedmans and peacetime economic policy. So am I.) 

Freedom of religion and of speech are rights, of individuals against interference by their government. By putting "freedom from want"  after the first two basic rights of a democratic society, this quote elevates "freedom from want" to a similar right, against the Federal Government, and thus against your fellow citizens.

No. "Freedom from want" is the result of a prosperous, free society. The first Amendment does not grant  a right to a check from the Government. "Freedom from fear" also applies to the Schecter brothers' fear that the National Recovery Administration might shut down their business for selling chickens too cheaply.

(I can foresee the inevitable calumny: "You free-marketers are all heartless, you just don't care." No. We care more. We want a system that actually delivers freedom from want.)

Brad saved the best for last.  Read it again (my emphasis):
I see 1980 as coming at the end of the fastest and most complete 50-year expansion of freedom, democracy, and prosperity the world had ever seen.
"The end??!!" 

Here are a few "freedom, democracy and prosperity" events Brad seems to have missed since 1980:
  • The Reagan and Thatcher revolutions, including deregulation, tax reform, victory over inflation and inauguration of a 20-year economic boom. 
  • A billion Chinese released from abject poverty. (Hint to China: read Capitalism and Freedom next.)
  • A billion Indians, also starting to join the modern world, having begun to overturn their Keynesian / English-socialist model. 
  • We won the cold war. East and West Germany reunited. Eastern Europe freed.
  • The number of democracies, for example as scored by Polity, doubled since 1980. Many in Latin America and Africa too.
1980 was indeed an end. It was an end to US and UK inflation -- the result of mindless "stimulus" -- and the end of widespread acceptance of simpleminded Keynesian economics. It was the end of a brief interlude of unquestioning belief in the power of the Federal Government to solve all problems. It was the end of stagnation in the US and UK.

1980 was an inflection point for the advance of freedom, not its end! Yes, some of the Friedmans' dark worries did not pan out. Why not? Because people read the book! The Friedmans were fighting against the "tide of history." And turned it back. 

"Complete??!!"  We have a long way to go, and we've been heading backwards in the last few years, on all indices of economic and political freedom. Our 30 years of liberalizations may indeed now be coming to an end. The economic and political ills of the 1970s seem to be returning.

I'll agree with Brad on one thing -- It's a great time to read the book.

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