Milton Friedman’s Common Sense

Fifty years ago this year, conservative economist Milton Friedman won the Nobel Prize in Economics for “common sense.” The Nobel committee put it differently, honoring his “achievements in the fields of consumption analysis, monetary history and theory … complexity of stabilization policy,” but it was just common sense.

Please do not get me wrong, I love Friedman’s devotion to individual liberty, cutting taxes and regulations, and making things predictable with less government.

He hated “concentrated power,” by any name. The government could step on people’s rights, and did as it grew bigger, more incompetent, corrupt, expensive, and offensive.

Friedman was brilliant, not just as an economist but as a communicator, a guy who made complex stuff, lots of math, sound simple. A real gift, he had it. 

If you want a good book, try Free to Choose (1980), or watch his television version. His point was that free markets are vital, and economic and political freedom are two sides of one coin. If you keep one, you get the other; lose one, lose the other.

From California to Maine, we are seeing government “concentrate power,” get unaccountable, corrupt, and uncontrollable. We need more Friedman “common sense.”

Here are seven Friedman lessons.”

First, fight to keep government small. Why? “When a man spends his own money to buy something for himself, he is very careful about how much he spends and how he spends it. When a man spends his own money to buy something for someone else, he is still very careful about how much he spends, but somewhat less what he spends it on.”

“When a man spends someone else’s money to buy something for himself, he is very careful about what he buys, but doesn’t care at all how much he spends. And when a man spends someone else’s money on someone else, he doesn’t care how much he spends or what he spends it on. And that’s government for you.”

So, keep government small, taxes low, regulations down, and spending down.

Second, defend individual liberty to the death. “A society that puts equality before freedom will get neither. A society that puts freedom before equality will get a high degree of both.” Expanding: “A society that puts equality — in the sense of equality of outcome — ahead of freedom will end up with neither equality nor freedom.”

Worse: “The use of force to achieve equality will destroy freedom, and the force, introduced for good purposes, will end up in the hands of people who use it to promote their own interests.”

Third, never forget the likelihood of unintended consequences. The old churchman  John Wesley wrote, “The road to hell is paved with good intentions.” Friedman agreed. “One of the great mistakes is to judge policies and programs by their intentions rather than their results.”

“Government has three primary functions. It should provide for military defense of the nation,” or at the state level, protect citizens. “It should enforce contracts between individuals,” or encourage commerce. “It should protect citizens from crimes against themselves or their property,” or assure public safety.”

“When government – in pursuit of good intentions, tries to rearrange the economy, legislate morality, or help special interests, the costs come in inefficiency, lack of motivation, and loss of freedom. Government should be a referee, not an active player.”

Fourth, watch immigration. Be careful who comes and why, assuring civic connection, assimilation, hard work, and citizenship follow immigration. Why? “You cannot simultaneously have free immigration and a welfare state.”

Fifth, beware the government’s power to replace work with sloth, dependence, and entitlement. “If you pay people not to work and tax them when they do, don’t be surprised if you get unemployment.” Expanding: “When you start paying people to be poor, you wind up with an awful lot of poor people.”

In a nutshell, do not imagine that the government makes things. Look around you, free people making a profit through creativity and hard work make things; we need more of that, less government. Besides, “Anything that government can do, private enterprise can do for half the cost.”

Sixth, we do not have too few taxes; we have too much spending. “Higher taxes never reduce the deficit. Governments spend whatever they take in and then whatever they can get away with.” It’s Lucy and the football. Don’t fall for it.

Seventh, big government corrupts voters. “Since the 1930s the technique of buying votes with the voters’ own money has been expanded to an extent undreamed of by earlier politicians.” This is why we need limits; less government is more integrity.

In the end, Milton Friedman believed in the genius of America. Maximizing liberty maximizes good fortune, opportunity, and the best life we can make for ourselves. He was a believer in free markets and limited government, the only way to “life, liberty, and the pursuit of happiness.” Fifty years after his Nobel Prize, his common sense still resonates. 

Robert Charles is a former Assistant Secretary of State under Colin Powell, former Reagan and Bush 41 White House staffer, Maine attorney, ten-year naval intelligence officer (USNR), and 25-year businessman. He wrote “Narcotics and Terrorism” (2003), “Eagles and Evergreens” (North Country Press, 2018), and “Cherish America: Stories of Courage, Character, and Kindness” (Tower Publishing, 2024). He is National Spokesman for AMAC. Today, he is running to be Maine’s next Governor. BobbyforMaine.com