Policy Wise

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Paul Krugman has an interesting article on free market guru-Milton Friedman.

Milton Friedman played three roles in the intellectual life of the twentieth century. There was Friedman the economist’s economist, who wrote technical, more or less apolitical analyses of consumer behavior and inflation. There was Friedman the policy entrepreneur, who spent decades campaigning on behalf of the policy known as monetarism—finally seeing the Federal Reserve and the Bank of England adopt his doctrine at the end of the 1970s, only to abandon it as unworkable a few years later. Finally, there was Friedman the ideologue, the great popularizer of free-market doctrine.

Did the same man play all these roles? Yes and no. All three roles were informed by Friedman’s faith in the classical verities of free-market economics. Moreover, Friedman’s effectiveness as a popularizer and propagandist rested in part on his well-deserved reputation as a profound economic theorist. But there’s an important difference between the rigor of his work as a professional economist and the looser, sometimes questionable logic of his pronouncements as a public intellectual. While Friedman’s theoretical work is universally admired by professional economists, there’s much more ambivalence about his policy pronouncements and especially his popularizing. And it must be said that there were some serious questions about his intellectual honesty when he was speaking to the mass public.[link]

Krugman acknowledges Friedman’s greatness as an economist -he calls him ‘one of the greatest economic thinkers of all times’ . He specifically refers to Friedman’s explaination of stagflation as seminal and pathbreaking. Expectedly enough, he is not quite as enamoured with Friedman the public intellectual, going as far as calling him ‘intellectually dishonest’. I am not qualified enough to comment on Friedman’s contribution to economics, so I will restrict myself to a short commnt on Friedman’s legacy as a public intellectual.

Friedman’s introduced two primary ideas a) an individual would always be better able to understand his needs rather than the state b) free market competition would allow the consumer to benefit most. These relatively simple ideas (as they seem now) transformed the intellectual landscape of post-war America and have done much to establish the ascendance of free market principles as even Krugman acknowedges.

It can certainly be argued that Friedman took his free market ideas to their logical and sometimes not so logical conclusions. Friedman’s support for Pinochet’s regime is often cited as a dark chapter in his intellectual legacy. There is certainly some merit in this view and a frank appraisal of Friedman’s legacy must include his support for Pinochet’s genocidal regime. However, to argue that solely this mars his legacy as a public intellectual, as much of the Left intelligentsia would like us to believe is taking a rather myopic view of things. By that yardstick, Communism or even Socialism which has killed millions more than Pinochet ever did would have been banished from the mainstream political thought. Quite characteristically, the Left refuses to judge itself by the yardstick it sets for others.

I am inclined to agree with Krugman that in his public intellectual avatar Friedman could be dogmatic and sometimes showed an inability to move forward, even when some of his ideas were discredited-most famously monetarism. However, only such (over)simplification allowed Friedman to find a larger audience for his ideas helping make the rather difficult jump from an academic to an influential public intellectual. So, while Krugman might criticise Friedman for ‘going too far’, only that gave him the moral courage to propound his ideas in an intellectual envoironment which was distinctly unfavorable to him.

Anyway, do read the whole thing.

P.S- Freedom for me is an article of faith-I don’t look at it from an utilitarian perspective but ideologically, for me, it is the most important thing. For example, I would any day live in a poor, democractic India than a rich autocratic China. By the same yardstick, I would prefer living in U.S.A with all it’s attendant uncertainties rather than socialist Sweden which virtually guarantees a reasonable quality of life to it’s citizens. However, I do recognise that it may not matter that much to every individual and that is why I do see the role of some government regulations/interventions to correct market failures.

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