What is the role of government! Today, we explore a bold vision for simplifying government operations, inspired by the ideas of renowned economist Milton Friedman from 16 years ago. What happens when we rethink the core functions of government and challenge the status quo? Join us as we break down each department—what stays, what goes, and why. This is a conversation about freedom, efficiency, and the balance of power.
Has anything he says changed today. Is government more or less efficient today than two decades ago? The answer is no, it is a bigger bloated mess.
BTW if you don’t know who Martin Friedman is, see the the bio at bottom of post.
Let’s dive in!
So I want to just go right down the list quickly and have you give me a thumbs up or thumbs down—keep them or abolish them.
- Department of Agriculture: Abolish, gone.
- Department of Commerce: Abolish, gone.
- Department of Defense: Keep.
- Department of Education: Abolish, gone.
- Department of Energy: Abolish, except as it ties in with the military. Well, then we shove it under defense. That handles the nuclear; that ought to go under defense.
- Department of Health and Human Services: There is room for some public health activities to prevent contagion, for example. Keep the National Institutes of Health and the Center for Disease Control? Not entirely; those are mostly research agencies. The question of whether the government should finance research is complicated. Eliminate half of the Department of Health and Human Services.
- Department of Housing and Urban Development: Out. It has done enormous harm, destroying parts of cities under the rubric of eliminating slums. For example, selling public housing units to current inhabitants for a dollar a piece would be worth doing if the department were abolished.
- Department of the Interior: First, sell off all the land the government owns. The government currently owns about one-third of all the land in the country. It should go down significantly, although the government should own land on which its buildings sit.
- Department of Justice: Keep.
- Department of Labor: Abolish, gone.
- Department of State: Keep.
- Department of Transportation: Abolish, gone.
- Department of the Treasury: Keep, to collect taxes.
- Department of Veterans Affairs: Could potentially be abolished by paying lump sums as compensation for services rendered in the Armed Forces.
If you are made dictator for one day, what happens next?
No, I don’t want to be made dictator; I don’t believe in dictators. Change should be brought about by the agreement of the citizens. If we can’t persuade the public that these changes are desirable, we have no right to impose them, even if we had the power to do so.
From 14 departments down to fundamental functions:
The fundamental functions of government are:
- Preserve the peace.
- Defend the country.
- Provide a mechanism whereby individuals can adjudicate their disputes (e.g., Department of Justice).
- Protect individuals from being coerced by others (e.g., police).
These functions should primarily be carried out by local and state governments, with minimal involvement from the central government.
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Milton Friedman (1912–2006) was one of the most influential economists of the 20th century, known for his advocacy of free-market capitalism and limited government intervention. His work fundamentally shaped modern economic thought, particularly in areas like monetary policy, the role of government, and personal liberty.
Key Contributions:
- Monetary Policy:
- Friedman argued that inflation is always a monetary phenomenon, controlled by the amount of money in circulation. His work helped shift focus from fiscal policy to monetary policy in managing economies.
- He advocated for a steady, predictable increase in the money supply, which influenced central banks worldwide.
- Free-Market Advocate:
- A proponent of deregulation, privatization, and limited government, Friedman believed that markets were more efficient than governments in allocating resources and solving problems.
- He criticized Keynesian economics for its reliance on government intervention.
- Education:
- Friedman proposed the concept of school vouchers, allowing parents to choose where to send their children, fostering competition and improving education quality.
- Capitalism and Freedom:
- His 1962 book Capitalism and Freedom argued that economic freedom is a prerequisite for political freedom, laying the intellectual foundation for market-driven policies.
- Public Influence:
- Friedman reached beyond academia through his books, TV series (Free to Choose), and public debates, making economics accessible to a wider audience.
- Nobel Prize:
- Awarded the Nobel Memorial Prize in Economic Sciences in 1976 for his work in consumption analysis, monetary history, and stabilization policy.
Legacy:
Milton Friedman’s ideas have been praised for promoting economic growth and personal liberty. However, they have also faced criticism for their perceived insensitivity to social welfare and inequality. Despite this, his influence continues to be felt in debates about government size, free markets, and the role of monetary policy in stabilizing economies.
Here are the top points Milton Friedman promoted throughout his career, encapsulating his philosophy on economics, government, and freedom:
1. Economic Freedom as a Prerequisite for Political Freedom
- Friedman argued that personal and political freedom are deeply intertwined with economic freedom. Without the ability to make free economic choices, other freedoms are at risk.
2. Free Markets Over Government Intervention
- He believed markets are more efficient at allocating resources than governments. Interference often leads to inefficiency, waste, and unintended consequences.
3. Limited Government
- The government’s role should be restricted to:
- Protecting property rights.
- Enforcing contracts.
- Maintaining national defense.
- Providing a legal framework for resolving disputes.
4. Monetarism
- “Inflation is always and everywhere a monetary phenomenon.”
- Friedman emphasized controlling the money supply to manage inflation and economic stability.
- He opposed Keynesian fiscal policies, advocating instead for predictable, rule-based monetary policy.
5. School Choice
- Proposed the voucher system, allowing parents to use public funds for private or public schooling. This approach was aimed at fostering competition and improving education.
6. Critique of Welfare and Social Programs
- Friedman criticized many welfare programs as being inefficient and counterproductive, arguing they often hurt the very people they aim to help.
- He promoted a negative income tax as a simpler, more effective alternative to traditional welfare.
7. Voluntary Exchange
- He championed voluntary trade and exchange, asserting that individuals know their own preferences better than governments do, leading to better outcomes when left to decide for themselves.
8. Privatization
- Advocated privatizing government functions (e.g., postal services, public housing) to improve efficiency and innovation.
9. Floating Exchange Rates
- Argued for flexible exchange rates where currency values are determined by market forces rather than government intervention.
10. Opposition to Corporate Social Responsibility
- Friedman famously argued that a company’s sole responsibility is to maximize profits for its shareholders, within the bounds of law and ethical customs.
11. Role of Personal Responsibility
- He believed in personal accountability and decision-making, emphasizing that individuals, not governments, should bear the responsibility for their actions and well-being.
12. Freedom of Choice
- His philosophy was encapsulated in the title of his book and TV series, Free to Choose, advocating for minimal restrictions on individuals’ economic and personal decisions.
These principles reflect Friedman’s unwavering belief in the power of markets and the dangers of excessive government control. Would you like to explore any of these in more depth?
Extra Credit:
https://x.com/i/status/1871520121212346496
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