Monday, November 20, 2006

# Posted 5:28 AM by Patrick Porter  

FRIEDMAN AGAIN: An electric exchange between economist Milton Friedman and US General Westmoreland (hat-tip, Erudito):
General William Westmoreland, testifying before President Nixon's Commission on an All-Volunteer [Military] Force, denounced the idea, saying that he did not want to command an army of mercenaries.

Milton Friedman interrupted him: "General, would you rather command an army of slaves?" Westmoreland got angry: "I don't like to hear our patriotic draftees referred to as slaves."

And Friedman got rolling: "I don't like to hear our patriotic volunteers referred to as mercenaries. If they are mercenaries, then I, sir, am a mercenary professor, and you, sir, are a mercenary general." And he did not stop: "We are served by mercenary physicians, we use a mercenary lawyer, and we get our meat from a mercenary butcher".
Mercenary professor? Gives us baby academics a frisson of menace.
(11) opinions -- Add your opinion

Friedman got this wrong.

Regardless of how a soldier got there, what Friedman calls slavery starts after induction when the soldier can't terminate his employment with the army. It doesn't start with the draft lottery that the Greeks used.

Doubtless Friedman would give high marks to our all volunteer force of bloggers.
Milton was a great debater. In the tribute that CRose did to him, they brought up that old quip (paraphrase), "Everyone is anxious to debate Milton, when he is not there."

He also had this notion that free markets spread freedom, a proposition that always seemed to require too much suspension of disbelief at face.

As I recall, Friedman thought that free markets were a necessary but not sufficient condition for freedom. Since there has never been a free country where the government owns everything, the evidence would seem to indicate that he was right.

I just ran across this from Gary Becker. http://www.becker-posner-blog.com/archives/2006/11/on_milton_fried.html

The first chapter of Capitalism and Freedom considers the link between economic and political freedom. He argues there that economic freedom promotes political freedom, and that political freedom is not likely to persist without economic freedom. "The kind of economic organization that provides economic freedom directly, namely, competitive capitalism, also promotes political freedom because it separates economic power from political power and in this way enables the one to offset the other." Findings since then suggest that while economic freedom can begin under totalitarian regimes, such as under General Pinochet in Chile and General Chiang Kai-Shek in Taiwan, economic freedom produces economic growth and other changes that usually eventually lead to much greater democracy, as in Taiwan, South Korea, and Chile. The important implication is that China would become more democratic if it continues on its path of greater economic freedom and greater growth.

On whether one can have democracy without economic freedom, Friedman said, "I know of no example in time or place of a society that has been marked by a large measure of political freedom, and that has not also used something comparable to a free market to organize the bulk of economic activity." Sweden and other Scandinavian countries have been vibrant democracies, and yet governments in these countries tax away more than half the income. However, the majority of these taxes are transferred back to individuals in the form of retirement incomes, medical care, and in other ways. Although these countries mainly rely on private enterprise, not government enterprises, to organize their economies, is that "enough" freedom to qualify as economically free? That depends on the definition of economic freedom, yet I believe Friedman is right that thoroughgoing restrictions on economic freedom would turn out to be inconsistent with democracy.
I don't believe Americans will see a military draft in their life times, and I am not one to recommend the idea. But it seems more fair and justice, and alot less cheaper, if the military would spread the misery around the country more evenly.

Many myths surround the draft and Vietnam that still hold sway 33 years after its abolishment . One was an Army study in 1971 showed that, in the field under enemy fire, there is no diffence in performance between a conscript and a volunteer. In other words, you cannot tell a volunteer from a conscript (draftee). That shoots Prof. Freidman's thesis in the loins. Somethings the government does cannot be accomplished by market principles, especially when asked to kill and die for your country.

Another myth from that period is that the "rich boys did not serve." That statement is a fallacy. When MIT did a short socioeconomic sketch of the names of the dead on the Vietnam War Memorial in Washington, D.C., they found that the two extreme ends of the economic strata were over represented.

The poor boys were crawling on the bellies through rice paddies, the rich boys were being shot out of the sky by enemy AA fire. The dirty little historical secret is the middle class boys did not want to fight in Vietnam. Some exapmles: Bill Clinton. Trent Lott, Dick Cheney, Newt Gingrich,Bruce Springsteen, Slyster Stallone, etc.

The draft is the ultimate "Third Rail" of American politics. Yes, it might be needed but any of the two major political parties that seriously attempts it will be bandished to the hinderlands of minority status for at least a generation. Charlie Rangle can talk about it but his party, like the Republican Party, will never attempt it.

The American military will continue to pay $40,000.00 plus re-enlistment bonuses and make sense out of non-sense, and Americans will do what they always do when they get in trouble - buy their way out!

Danny L. McDaniel
Lafayette, Indiana
"The kind of economic organization that provides economic freedom directly, namely, competitive capitalism, also promotes political freedom because it separates economic power from political power and in this way enables the one to offset the other."
Roger, It's been so many years since I've read this tomb that I couldn't approach the exact argument with any authority.

It's not clear what "economic freedom" amounts to under laissez-faire economics.

It is means a widened range of economic choice, then we might argue endlessly about what choices that free-markets offer that are more valuable than other models.

If increased choice in the context of eliminating dependency, which seems close to the thrust of "offset", we might agree if we looked at how power of the purse gave women increased political power in the last century in many nations or if we looked at how competition may have reduced repressive political patronage. All the same, these would have to be weighed in comparison to other factors shown to have been important in economic development, for instance, land reform in Japan and the Philippines. Last, peasants in Bangladesh or wherever, who might become endowed with free-market reforms, don't have any expanded democratic control over their government that is obvious.

What's more, there seems to be quite a range of 'freedom' within a given competitive capitalist economy, ranging from the poor, who may have no economic choices and command nothing, to the wealthy, who may live without economic concern whatsoever (i.e. virtually free from scarce resource decisions). Such a range that includes apparent opposites begs the question whether there is such a thing as 'aggregate economic freedom' or not.

We also don't have to accept that money doesn't find a way into politics in capitalist systems. We know it does, profoundly, even. We know that it also works to "manage"/limit consumer choice. Perhaps the slope to abuse is more slippery within command economies, but private wealth - especially large or concentrated amounts - has been known to threaten political freedom.
Well, here's another perspective on Friedman:

I only saw Milton Friedman in person once, but it made a lasting impression on me. About a decade ago, I stumbled into the wrong session at the American Economics Association Convention. Milton Friedman was weighing in on the impact of various presidents' councils of economic advisors. He was pointing out that many measures of considerable economic importance often get little scrutiny. The particular example I remember him discussing was the Americans With Disabilities Act, which requires businesses to make reasonable efforts to make their places of business accessible to employees and customers with disabilities. I stayed long enough to hear Mr. Friedman argue that this act imposed enormous costs on "normal people." I am afraid that I do see some important things differently.

I can certainly envisage Friedman saying that.
Milton Friedman has won all his big arguments all over the place, so he didn't really die. Take school vouchers--there's nobody against them any more excapt the unions. Take individual accounts for medical savings, or Social Security, or 401K, etc.--they're all winners. The reactionaries can continue to slow down implementation of Friedman, but his ideas have blown the liberals away. It's only a question of time before we live in a much more Friedman-friendly nation.
Individiual accounts for medical savings are great provided that you never have to use them.

Vouchers are a great way to throw in the towel on public education.

401-K's are great - provided the fund managers don't screw things up, or you're stuck with crappy stock like my friend who works for Sports Illustrated and watched his 401-K tank after AOL "purchased" Time Warner. Wonder what Friedman thought about Enron . . .

Could you provide directions to this perfect world of yours?
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