Top tips of the timeless economist
When he died aged 94, Milton Friedman had marked himself out as one of the pre-eminent economists of his time. His timeless observations were informed by a life well lived, one that spanned two world wars and countless economic changes to society. In the eleven years since his death, Friedman continues to offer prescient pearls of wisdom that are relevant today, and we’ve unpicked some of his best quotes and beliefs for your benefit.
"There’s no such thing as a free lunch"
Friedman believed every business interaction had a cost, no matter whether it was free on the face of it. A free lunch is never free down the line - it’s simply a gesture of goodwill for a favor you’re likely to return.
"Governments never learn. Only people learn."
Friedman was notoriously scathing of the monopolizing effect he believed governments placed on commerce. A truly capitalist society - that championed wealth creation - should be free of government intervention altogether.
"Underlying most arguments against the free market, is a lack of belief in freedom itself."
Friedman was a staunch protector of “free markets”. To achieve prosperity, he believed in decreasing the role government played in the jobs market, believing it to be a bureaucracy that erected barriers around free enterprise.
"The minimum wage is prohibitive"
Friedman believed that setting a high minimum wage was counterproductive and hurt low-level employees, not employers. By lowering the wage, bosses would be more inclined to hire staff who could learn on the job, gain valuable experience and cement a higher-paying job from that experience.
"Most economic fallacies derive from the tendency to assume that there is a fixed pie: that one party can gain only at the expense of another."
Central to this argument is that economic transactions inevitably favor both parties or they wouldn’t be carried out at all. That’s the nature of voluntary commerce; the type of commerce you find in free market societies where people aren’t being strongarmed to serve the government.
"The world runs on individuals pursuing their self 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."
This is one of Friedman’s great quotes: here he emphasizes the notion that self-interest is the secret to mankind’s success. There’s nothing wrong with pursuing our own selfish interests - it’s the tonic that has sparked some of the world’s greatest achievements.
Friedman died at 94 having lived a life that was full of notoriety, fame and financial success, but throughout his career he was unable to reduce the impact government played in our economies. All the same, he stands the test of time and reinforce.