President Obama, Economics, and Milton Friedman

Dinner Topics for Monday: A Lesson in Economics

One sound bite is two minutes of Milton Friedman schooling Phil Donahue and his audience in greed and capitalism and virtue.  Before that, though, I want to play for you a sound bite of "Barack Hussein Obama!  Mmm!  Mmm!  Mmm!" reading the audio version of his book, The Audacity of Hope.  This is Obama talking about a sermon by Reverend Wright that moved him.(Rush Limbaugh)

OBAMA:  It is this world, a world where cruise ships throw away more food in a day than most residents of Port-au-Prince see in a year. Where white folks' greed runs a world in need. Apartheid in one hemisphere, apathy in another hemisphere. That's the world on which hope sits.

RUSH:  He was quoting Reverend Wright, and he said that's for me, man, I love that.  White folks' greed runs a world in need.  So let's go to 1979, ancient times for many of you.  We may as well be going back to the Roman Coliseum for this.  Nineteen seventy nine, I was 28.  Ancient times for many of you.  Phil Donahue interviewing Milton Friedman, and they had this exchange.  And Donahue starts off wanting to know about greed and capitalism.  Here it is.  And listen to this.

DONAHUE:  When you see around the globe the maldistribution of wealth, the desperate plight of millions of people in underdeveloped countries, when you see so few haves and so many have-nots, when you see the greed and the concentration of power, did you ever have a moment of doubt about capitalism and whether greed's a good idea to run on?

FRIEDMAN:  Well, first of all, tell me, is there some society you know that doesn't run on greed?  You think Russia doesn't run on greed?  You think China doesn't run on greed?  What is greed?  Of course none of us are greedy. It's only the other fellow who's greedy.  

The world runs on individuals pursuing their separate interests.  The great achievements of civilization have not come from government bureaus.  Einstein didn't construct his theory under order from a bureaucrat.  Henry Ford didn't revolutionize the automobile industry that way.  In the only cases in which the masses have escaped from the kind of grinding poverty you're talking about, the only cases in recorded history are where they have had capitalism and largely free trade.  If you want to know where the masses are worst off, it's exactly in the kinds of societies that depart from that. 

 So that the record of history is absolutely crystal clear that there is no alternative way, so far discovered, of improving the lot of the ordinary people that can hold a candle to the productive activities that are unleashed by a free enterprise system.

DONAHUE:  But it seems to reward not virtue as much as ability to manipulate the system.

FRIEDMAN:  And what does reward virtue?  Do you think the communist commissar rewards virtue?  Do you think  Hitler rewards virtue?  Do you think American presidents reward virtue?  Do they choose their appointees on the basis of the virtue of the people appointed or on the basis of their political clout?  Is it really true that political self-interest is nobler somehow than economic self-interest?  You know, I think you're taking a lot of things for granted.  Just tell me where in the world you find these angels who are going to organize society for us.

DONAHUE:  Well --

FRIEDMAN:  I don't even trust you to do that.

RUSH:  Milton Friedman back in 1979 schooling Phil Donahue, and everybody else who heard that on the notions of virtue and greed and just basically upsetting Phil's applecart.  Phil wasn't smart enough to know it was happening. He's still running around lamenting the accident of birth. If he'd been 30 miles south he would have grown up in poverty.  Anyway, we wanted to play that for you and recognize Milton Friedman.

Milton Friedman:  "If you put the federal government in charge of the Sahara Desert, in five years there will be a shortage of sand." 

 Milton Friedman:  "Underlying most arguments against the free market is a lack of belief in freedom itself." 

Another Milton Friedman quote:  "Most of the energy of political work is devoted to correcting the effects of mismanagement of government."  

Boy, isn't that true? Pass another law.  Government comes along and creates a program.  The program is an absolute disaster.  Government says, "That's gotta get fixed."  Government says, "Okay, we'll fix it."  And it compounds itself, one error atop another. (Rush)

Another Milton Friedman quote:  "Nothing is so permanent as a temporary government program."  

I'll tell you, the guy was great.  He was a genius.  He lived into his late eighties.  He would have been a hundred years old this week. (Rush)