Tag: Milton Friedman

Andrew Yang’s UBI Plan is No Breath of Fresh Air

Glenn Verasco | Thailand

If there’s one welfare state proposition that makes Libertarians reconsider their anti-government position, it might be UBI (Universal Basic Income). The concept of UBI is simple: every person in a given country gets cash from the government every month. Rather than rationing food, energy, or clothes like a purely Socialist society, a nation with UBI allows those on the receiving end to decide which of their needs should be met the same way people who earn their own money do.

Continue reading “Andrew Yang’s UBI Plan is No Breath of Fresh Air”

Advertisements

The Difference Between Austrian and Chicago Economics

By Jack Parkos | United States

When it comes to economics, libertarians tend to subscribe to one of two schools of thought: The Chicago School and Austrian School. Both of these ideologies are rooting in laissez-faire capitalism and believe in the power of the free market. Yet both have unique differences between them that can divide people who believe in free market capitalism. It is important to understand the differences between the two for one to decide which school they agree with.

“Mainstream” Recognition

The Chicago School, which is sometimes called the Monetarist School, belongs to the neoclassical school of thought. It tends to get more attention from “mainstream” economists and politicians. Milton Friedman, arguably the most famous and influential economist of the Chicago School, served as an unofficial advisor to President Ronald Reagan as well as winning many awards for his books. While many Austrians have won awards for their work, they are not nearly as “popular” as their Chicago counterparts. In a high school economics course, you’re more likely to learn about Milton Friedman and Chicago economics than Ludwig von Mises and Austrian economics. Austrians are seen as outside the mainstream, meaning it is “heterodox”. Perhaps someone may be asking why this occurs.

Difference in Methods

One reason that Austrians tend to be seen as economic “outcasts” is that they tend to use different methods to come to conclusions. As stated before, Austrians are not seen in the mainstream, unlike their Chicago counterparts.

This is mainly due to the fact that Chicago economists tend to use similar methods as most other economists. Monetarists tend to use mathematics to test their theories. Chicago economists believe economics is like a science with rules that cannot be broken. Meanwhile, the Austrians believe that since the economy is based on the actions of individuals, no mathematical formulas can accurately predict how people would act. Thus, Austrians base their work on philosophy, logic, and reasoning. Praxeology, the study of human nature, is an important part of the Austrian School of economics.

Monetary Policy

While both schools criticize the Federal Reserve, they have different reasoning for it. The Chicago school calls out the Federal Reserve’s failures but still believe it should exist and be used in the right way. Monetary policy is a big part of Chicago economics, hence sometimes being called the Monetarist School. For example, Milton Friedman criticized the federal reserve for not printing enough money during the Great Depression.  Friedman also believed the monetary supply should be increased by about 2.5-3.5% each year.

Meanwhile, the Austrians do not believe the government should print more money ever. They tend to believe in a fixed supply, typically a standard based off of precious metals. The Austrians do not want the government inflating the currency at all. They blame many economic problems on government creating inflation through printing money.

 

Famous Economists

Here are some famous economists from the Austrian and Chicago schools.

Austrians

Ludvig Von Mises- Big leader and teacher of the Austrian school of thought.

Murray Rothbard- A leading pioneer of both Anarcho-Capitalism and Paleo-Libertarianism.

Frédéric Bastiat- Developed the concept of opportunity cost.

Chicago

Milton Friedman- Won Presidential Award for Freedom, possibly most famous Chicago economist.

Thomas Sowell- National Humanities Award winner, theorist on welfare economics.

Gary Becker- Awarded Nobel Memorial Prize in Economic Sciences.

Friedrich Hayek (who also belonged to the Austrian School) – Award-winning economist who contributed to the Business Cycle Theory and The Economic Calculation Problem.


Get awesome merchandise. Help 71 Republic end the media oligarchy. Donate today to our Patreon, which you can find here. Thank you very much for your support!

Featured Image Source

Five Great Freedom Books

By Atilla Sulker | United States

By dipping his or her toes into libertarianism, one can find how extensive and comprehensive the literature is. The assortment is indeed full of fresh, fertile ideas comprising of a significant range of perspectives. But it is not just merely the genius of these ideas that makes the collection so comprehensive- it is also the passion behind the libertarian movement that has lead to continuing debate and the bettering of ideas within the movement.

Go visit the Rothbard library for yourself and you will see not just a mere library, but a cultural center, a true marvel. Books on economics, history, philosophy, anthropology, you name it. Rothbard was truly an interdisciplinary genius who devoted his life to reading and writing, hence the vastness of his contributions to libertarian academia.

I am but a budding enthusiast in the liberty movement, and of the massive number of books out there, I have only read a small portion of them. Here, in no particular order, are five books I have read that I think are very worthwhile reads. Some of these books are relatively popular and some were even written by bestselling authors, while others are more obscure and overlooked. Some focus on philosophy, others on economics.

  1. Liberty Defined by Ron Paul

Liberty Defined was the second freedom book that I read, after reading Rand Paul’s Taking a Stand. The book is organized in a very convenient fashion. One doesn’t need to read the book in order. Paul goes through 50 different topics, dedicating a chapter to each, all organized in alphabetical order. The book is a comprehensive treatise on Ron Paul’s positions on various issues, as the book indexes Paul’s position on the issues by chapter. I read the book in order the first time, but the second time, I flipped to random chapters as this can be easily done without throwing off the reader. The reader can quite literally flip to any chapter and become enlightened.

Most chapters are relatively short, but provide a concise account of each topic. Issues discussed include bipartisanship, Zionism, democracy, immigration, global warming, Keynesianism, and many more. This is also the book that introduced me to Austrian economics and the Mises Institute, as there is a chapter dedicated to Austrian economics. Any time there is an issue in the news, or if there is an issue in which you need to prime yourself, pick up the book and find the relevant chapter.

2. Theory and History by Ludwig Von Mises

Theory and History is a very interesting book to say the least and according to Dr. David Gordon, it is one of the easiest Mises books to read. The book is an epistemological and methodological treatise and outlines the praxeological method that ought to be used in the social sciences. Praxeology is the science of human action, with the chief premise being that humans engage in purposeful behavior.

The book sharply rebukes mainstream “scientific” methods of studying economics and establishes the premise that the social sciences differ greatly from the natural sciences in the sense that the social sciences study human action. Human action is entirely unpredictable and hence can not be predicted to the extent that events in the realm of the natural sciences can be predicted. Mises establishes the premise of methodological dualism, which asserts that the method used in the social sciences must be different from the method used in the natural sciences. Mises also discusses history and takes apart the Marxist interpretation of history. He puts emphasis on the free will and takes down such fallacious doctrines as materialism, determinism, and positivism.

3. Defending the Undefendable by Walter Block

Defending the Undefendable is one of those rare books that really gives the reader a mind blowing, mind changing experience. The book essentially does what is says it will do- it defends the undefendable. Block begins by establishing the non- aggression principle and uses this to guide the reader through the rest of the book. The book can actually be very convincing to non-libertarians, providing that the reader is to a degree sympathetic to the NAP, or at the very least has an open mind.

Once the reader considers the NAP, they will be able to understand how Block is able to defend these supposedly vile roles in society. One will see that Block puts heavy emphasis on the concept of voluntary exchange to advance his thesis. For example, in the first chapter titled “The Prostitute”, Block states that prostitution demonstrates a voluntary exchange of fees for sexual services. Reading this one chapter completely changed my perspective of prostitution, though I am still adamantly against prostitution personally.

Anyone who correctly understands the NAP and the concept of voluntary exchange will see that prostitution is actually just a peaceful exchange, just like any other exchange. The beauty of Block’s argument is that he maintains that one can be against prostitution, yet be in support of legalizing it. This is a very important point, and Block’s characterization of prostitution as an exchange helps to advance this point. Among other “evils” that Block defends include the inheritor, the stripminer, the pimp, the drug addict, and the blackmailer.

4. The Case Against the Fed by Murray N. Rothbard

The Case Against the Fed was one of the last books written by Murray Rothbard. It is by far the best take down of the Federal Reserve that I have ever seen, especially considering its mere brevity (at only 158 pages). Take for example End the Fed by Ron Paul. This is also a great book and a sharp rebuke of the Fed, but even this book doesn’t take down the Fed in the same concise, step by step fashion in which Rothbard does. This is a key factor regarding the uniqueness of Rothbard’s book. It is very step by step and makes sure the reader understands the fundamentals before advancing to the topic of the Fed.

Rothbard starts by explaining exchange, loans, and counterfeiting, then begins to advance this and applies it to fractional reserve banking. Towards the middle of the book, Rothbard digresses and begins to talk about the history of the Fed and the competing interests that led to its formation. Towards the end of the book, he beautifully wraps up his thesis and explains how the Fed inflates money.

One will also notice that Rothbard uses a lot of diagrams to represent bank transactions. In this way the reader will see that he is crystal clear with his explanation, and if anything is confusing, it is the concept rather than Rothbard (This is what sets Rothbard apart from Mises, but this should not discourage you from reading the brilliant works of Mises). For this reason, Rothbard makes an excellent choice for someone who is a novice, and this book is a must for anyone who wants to understand central banking.

5. Reassessing the Presidency by John V. Denson and others

Reassessing the Presidency is just the book we in need in this day in age with the growing power of the president and the indoctrination of people into worshiping big government. The book features many essays written by many great libertarian scholars including Joseph Salerno, Thomas DiLorenzo, Thomas Woods, Ralph Raico, and David Gordon among others. These essays take down the fallacious praise given to many American presidents by mainstream historians.

With the infamous libertarian Alabama Judge John Denson as the editor, the collection contains scorching essays on numerous topics including Abraham Lincoln and mercantilism, the abuse of antitrust legislation, and the origins of the American empire. If there is one chapter that I must single out as the most impactful for me, it is the chapter on the electoral college by Randall G. Holcombe. Reading this chapter was one of those mind blowing moments. The thesis is that the American republic was not meant to be a democracy and senators were not meant to be directly elected. This is very important as the 17th amendment, which allows the direct election of senators, has led to steady growth in government. For a more in depth analysis of this topic, read Holcombe’s book From Liberty to Democracy.

Additionally, Reassessing the Presidency also examines some presidents from a more positive view, these presidents including Martin Van Buren and Grover Cleveland. Nonetheless, even when examining libertarian leaning presidents, the authors do not hesitate to acknowledge any of the shortcomings of the presidents. The book starts with a chapter on rating presidents from a libertarian perspective and conveniently ends with a chapter on the impossibility of limited government by Hans-Herman Hoppe. The book is long at 791 pages, but it is nonetheless a very rewarding experience, sharply rebuking mainstream views of the presidency. I would suggest the writing of a second volume which incorporates recent presidents (as this book was written in 2001), as well as presidents that have not been given significant attention within this work.

There are many great books on liberty out there and this list is just a very small sample. I think that some of these works in this list are very overlooked including Theory and History, The Case Against the Fed, and Reassessing the Presidency, so I hope that I have provided you with some further reading. I think all these books are very much standouts and deserve more attention. I now leave you with a list of other great books:

  • The Revolution: A Manifesto by Ron Paul
  • Capitalism and Freedom by Milton Friedman
  • The Betrayal of the American Right by Murray Rothbard
  • The Myth of National Defense by Hans-Hermann Hoppe and others
  • Crony Capitalism in America by Hunter Lewis
  • Speaking of Liberty by Lew Rockwell
  • I Chose Liberty by Walter Block
  • Principles of Economics by Carl Menger

To support 71 Republic, please donate to our Patreon, which you can find here.

Featured Image Source

Milton Friedman: One of the Great Libertarians

By Roman Bilan | United States

Murray Rothbard was born in 1926 and died in 1995. Milton Friedman was born in 1912 and died in 2006. Their careers almost entirely overlapped, yet one left a lasting influence on the free world, while the other died in more or less absurdity. Rothbard only influenced his own cult-like following, yet many of his anarcho-capitalists rather “throw out” Friedman’s libertarian legacy.

When it comes to twentieth century figures within the libertarian movement, there may no greater figure when it comes to influencing economics, the public, American public policy and the lives of millions.

Milton the Economist

Milton Friedman’s contributions to the science of economics cannot be understated. He was the figurehead of the Chicago School, a free market oriented school of economic thought based out of the University of Chicago. Alongside him were his prominent colleagues, Frank Knight, Ronald Coase, and Robert Lucas, to name a few.

The entire field owes a huge debt to Friedman and his crew. He overturned many of the prevailing errors brought about by the Keynesian Revolution: most notably with his critique of the Phillips Curve. Even Paul Krugman admits that Friedman did the science a great service with his contributions and critique of former Keynesian orthodoxy:

“Friedman’s critique of Keynes became so influential largely because he correctly identified Keynesianism’s weak points… I regard him as a great economist and a great man.”

-Paul Krugman

Regardless of how you feel about his political inclinations, he believed in them because of his economic thought. And his thought is arguably one of the most profound things to be produced in the 20th century. It is completely unfair to dismiss, much less “throw out,” someone because of minor disagreements on theory. Friedman is one of the greatest intellectuals of his time and libertarians should wholeheartedly embrace him as one of their own.

Milton the Public Intellectual

As was written in his obituary for FEE, “Friedman did more than any single person in our time to teach the public the merits of deregulation, privatization, low taxes, and free trade. His work inspired the economic agendas of President Ronald Reagan and British Prime Minister Margaret Thatcher, as well as the liberalization of economies in eastern Europe and the former Soviet Union.”

Take Capitalism and Freedom, for example. Read by over half a million in eighteen different languages, it introduced ideas like school vouchers and pushed for lower and flatter taxes.

Similarly, Free to Choose was the best selling nonfiction book in 1980 and was watched by millions. Only F.A. Hayek could boast a similar public reach for a libertarian.

Additionally, Friedman wrote over 300 op-eds for Newsweek, 121 op-eds for the Wall Street Journal and another twenty-two for the New York Times. But maybe he would have been been better off preaching to the libertarian choir instead of engaging with the public at large?

Milton Ends the Draft

In 1940, the United States began its third and final draft. On March 27, 1969 President Richard Nixon formed the Gates Commission to look at the possibility of an All-Volunteer Armed Forces– Friedman was one of its most prominent members. The commision of fifteen members had five members in favor of an all-volunteer armed forces while the other ten were split evenly between being against the idea and neutral towards it. In less than a year, the Commission came to a unanimous 14-0 recommendation (one member was unable to vote on the specifics, although he did support an all-volunteer military) to end the draft.

Three years later, the draft was gone.

Milton Influences Estonia

On August 20, 1991, Estonians left the darkness of the Iron Curtain and joined the free world as the Republic of Estonia replaced the Estonian Soviet Socialist Republic. Mart Laar was the first Prime Minister of Estonia after the interim government. He led from 1992 to 1994 and again from 1999 to 2002. As noted in Foreign Policy,

“In barely two years, from 1992 to 1994, the radical reforming Estonian government of Mart Laar introduced a flat tax, privatized most national industry in transparent public tenders, abolished tariffs and subsidies, stabilized the economy, balanced the budget, and perhaps most crucially, restored the prewar kroon and pegged it to the rock-solid deutsche mark. As a result, Estonia became one of the most open and transparent economies in Europe, and with growth came political stability: Russian troops left the Baltic region by 1994, fears of Balkan-style ethnic conflicts receded, and Soviet noncitizens in Estonia and Latvia began to assimilate.”

Before Laar became Prime Minister he read one book: Free to Choose by Milton Friedman. A few years later, he was in D.C., talking with US Representative Dick Armey. Armey asked how the Estonian government was able to be so successful with their free market reforms. Laar’s answer was simple, “We read Milton Friedman and F. A. Hayek”.

Milton Friedman: Common Complaints

No, Milton Friedman was not an Austrian, but Austrian Economics is not synonymous with libertarianism. Libertarians can be non-Austrian and Austrians can be non-libertarian.

No, Milton Friedman did not believe in Praxeology, but Praxeology is also not a necessity for libertarianism, nor is its veracity without question. Even F.A. Hayek, Ludwig Von Mises’s greatest student, broke from Praxeological orthodoxy.

No, Milton Friedman is not an anarcho-capitalist. He believes in a state, but anarcho-capitalism is only one part of the broader libertarian ideology. As Hayek said, “Our general views on what is desired and what is not are almost identical until we get on to money.”

The greatness of a libertarian should not be defined by their purity, but by how much they advance liberty. Libertarians like Murray Rothbard win the purity test but do little to advance libertarianism. As Paul Krugman wrote in 1994, Friedman waged a campaign “Goliath of Big Government” that “eventually bore fruit in radical changes in both economic ideology and real-world economic policy.”

Whether it be his direct or indirect influence on Republican administration, pushing free market policies in other countries, advocating for drug legalization, getting the state out of education, loosening licensing laws, giving less power to central banks or cutting taxes and spending, Milton Friedman’s legacy is one of promoting freedom and liberty. Thus, libertarians should be proud to share an intellectual home with him.


To support 71 Republic, please donate to our Patreon, which you can find here.

Featured Image Source.

 

 

Throw Out Milton Friedman

By Mason Mohon | @mohonofficial

I think it’s pretty clear that Friedman is a statist. -Murray Rothbard

Milton Friedman is popular, and not just “libertarian popular” (although he is) but mainstream popular. His book Capitalism and Freedom has over half a million sales and Free to Choose has also had its fair share of economic and political influence. I have spoken to many fellow lovers of the free market and many have stated he was their primary influence in pushing people towards libertarian ideology.

Continue reading “Throw Out Milton Friedman”