Milton Friedman Quotes

"Free markets" is a very general term. There are all sorts of problems that will emerge. Free markets work best when the transaction between two individuals affects only those individuals. Most often, a transaction between you and me affects a third party. That is the source of all problems for government. That is the source of all pollution problems, of the inequality problem. This reality ensures that the end of history will never come.

On aging societies, there is no reason why a country that has a lot of old people can't be prosperous if, during their working lives, individuals provide for their retirement.

The only reason there is a crisis about Social Security in the US and pensions in Europe and Japan is that you cannot maintain a "Ponzi" scheme indefinitely. We have collected from today's young to pay today's old and counted on tomorrow's young to keep doing so. That was a fine scheme as long as the number of young people was rising faster than old people. When that ratio comes to an end, such a system also has to end.

The same thing will happen in China that happened in Chile. Political freedom will ultimately break out of its shackles. Tiananmen Square was only the first episode. It is headed for a series of Tiananmen Squares. It cannot continue to develop privately and at the same time maintain its authoritarian character politically. It is headed for a clash. Sooner or later, one or the other will give.

A society that puts equality before freedom will get neither. A society that puts freedom before equality will get a high degree of both.

A free man will ask neither what his country can do for him nor what he can do for his country.

Politicians will always spend every penny of tax raised and whatever else they can get away with.

You had a flood of immigrants, millions of them, coming to this country. What brought them here? It was the hope for a better life for them and their children. And, in the main, they succeeded. It is hard to find any century in history, in which so large a number of people experience so great an improvement in the conditions of their life, in the opportunities open to them, as in the period of the 19th and early 20th century.

If you look at the balance sheet, the US is heavily in debt. If you look at the income account - the amount of interest the US pays abroad - it is almost exactly equal to the amount of interest that it receives from abroad. American assets held abroad are earning a higher rate of return than foreign assets held here.

The only way that has ever been discovered to have a lot of people cooperate together voluntarily is through the free market. And that's why it's so essential to preserving individual freedom.

And where are you going to get these angels who are going to run society for us?

The power to determine the quantity of money... is too important, too pervasive, to be exercised by a few people, however public-spirited, if there is any feasible alternative. There is no need for such arbitrary power... Any system which gives so much power and so much discretion to a few men, [so] that mistakes - excusable or not - can have such far reaching effects, is a bad system. It is a bad system to believers in freedom just because it gives a few men such power without any effective check by the body politic - this is the key political argument against an independent central bank.

It is a mark of how far we have gone on the road to serfdom that government allocation and rationing of oil is the automatic response to the oil crisis.

The Federal Reserve the privately owned U.S. central bank definitely caused The Great Depression by contracting the amount of currency in circulation by one third from 1929 to 1933.

The collapse of communism in essence added tens and tens of millions of people to the world labor supply, and the people who were added had previously been getting very low income, but they were not unskilled. Many of them were fairly well educated.

The most unresolved problem of the day is precisely the problem that concerned the founders of this nation: how to limit the scope and power of government. Tyranny, restrictions on human freedom, come primarily from governmental restrictions that we ourselves have set up.

What kind of society isn't structured on greed?

Nobody spends somebody else's money as carefully as he spends his own. Nobody uses somebody else's resources as carefully as he uses his own. So if you want efficiency and effectiveness, if you want knowledge to be properly utilized, you have to do it through the means of private property.

Never try to walk across a river just because it has an average depth of four feet.

There is still a tendency to regard any existing government intervention as desirable, to attribute all evils to the market, and to evaluate new proposals for government control in their ideal form, as they might work if run by able, disinterested men free from the pressure of special interest groups.

Political leaders in capitalist countries who cheer the collapse of socialism in other countries continue to favor socialist solutions in their own. They know the words, but they have not learned the tune.

The argument for the free market is a complicated and sophisticated one and depends on demonstration of secondary effects. I have confidence market efficiency will win out.

To the free man, the country is the collection of individuals who compose it, not something over and above them.

There is one and only one social responsibility of business - to use it resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.

Humility is the distinguishing virtue of the believer in freedom; arrogance, of the paternalist.

If a country is an attractive place for foreigners to invest their funds, then that country will have a relatively high exchange rate. If it's an unattractive place, it will have a relatively low exchange rate. Those are the fundamentals that determine the exchange rate in a floating exchange rate system.

Unfortunately, unanimity is not always feasible.

The Internet is the most effective instrument we have for globalization.

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

One of the reasons that I am in favor of less government is because when you have more government, industrialists take it over.

Self-interest is not myopic selfishness. It is whatever it is that interests the participants, whatever they value, whatever goals they pursue. The scientist seeking to advance the frontiers of his discipline, the missionary seeking to convert infidels to the true faith, the philanthropist seeking to bring comfort to the needy - all are pursuing their interests, as they see them, as they judge them by their own values.

If a tax cut increases government revenues, you haven't cut taxes enough.

[T]he burden of government is not measured by how much it taxes, but by how much it spends.

Inflation is a monetary phenomenon. It is made by or stopped by the central bank.

But on the other hand, if you come under circumstances where each person is entitled to a pro-rata share of the pot, to take an extreme example, or even to a low level of the pie, than the effect of that situation is that free immigration, would mean a reduction of everybody to the same, uniform level. Of course, I'm exaggerating, it wouldn't go quite that far, but it would go in that direction. And it is that perception, that leads people to adopt what at first seems like inconsistent values.

It is most attractive about the US to people and countries with wealth is that it can provide security, insurance really, against political instability. Nobody is afraid that the money they place in the US is at risk of expropriation or of in some other way being taken away. For this safety, the wealth holders of the world are willing to accept a lower rate of return.

Nobody spends somebody else's money as carefully as he spends his own.

There's no such thing as a free lunch.

. . I think the Adam Smith role was played in this cycle i.e. the late twentieth century collapse of socialism in which the idea of free-markets succeeded first, and then special events catalyzed a complete change of socio-political policy in countries around the world by Friedrich Hayek's The Road to Serfdom.

Nothing is so permanent as a temporary government program.

China's productive system draws upon the other East Asian countries to a great extent. The volume of trade is much larger than the net amount being exported from China. China needs substantial reserves to finance all that.

We have a freer world because of the collapse of the Soviet Union and the changes in China. Those two have been the main contributors to freedom in our time.

I think there is universal agreement within the economics profession that the decline - the sharp decline in the quantity of money played a very major role in producing the Great Depression.

Few trends could so thoroughly undermine the very foundations of our free society as the acceptance by corporate officials of a social responsibility other than to make as much money for their stockholders as possible.

How did we make the transition from using wood to using coal, from using coal to using oil, from using oil to using natural gas? How in God's name did we make that transition without a Federal Energy Agency?

There's only one thing that all of the central banks control and that is the base, their own liability, and they can control that in various ways. They can control it directly by open market operations, buying and selling government securities or other assets, for example, buying and selling gold, or they can control it indirectly by altering the rate at which banks lend to one another.

Doing good with other people's money has two basic flaws. In the first place, you never spend anybody else's money as carefully as you spend your own. So a large fraction of that money is inevitably wasted. In the second place, and equally important, you cannot do good with other people's money unless you first get the money away from them. So that force - sending a policeman to take the money from somebody's pocket - is fundamentally at the basis of the philosophy of the welfare state.

There's no point in comparing an actual, operating system with an ideal system that doesn't exist.