Monday, November 27, 2006

Milton Friedman - A heavyweight champ, at five foot two

The legacy of Milton Friedman, a giant among economists

IN 1946 two American economists published a pamphlet attacking rent controls. “It was”, recalled one of them many years later, “my first taste of public controversy.” In the American Economic Review, no less, a critic dismissed “Roofs or Ceilings” as “a political tract”. The same reviewer gave the pair a proper savaging in a newspaper: “Economists who sign their names to drivel of this sort do no service to the profession they represent.”

The reminiscing author was Milton Friedman, who died on November 16th, aged 94. In the wake of the Great Depression and the second world war, with the Keynesian revolution still young, championing the free market was deeply unfashionable, even (or especially) among economists. Mr Friedman and kindred spirits—such as Friedrich von Hayek, author of “The Road to Serfdom”—were seen as cranks. Surely the horrors of the Depression had shown that markets were not to be trusted? The state, it was plain, should be master of the market; and, equipped with John Maynard Keynes's “General Theory”, governments should spend and borrow to keep the economy topped up and unemployment at bay.

That economists and policymakers think differently now is to a great degree Mr Friedman's achievement. He was the most influential economist of the second half of the 20th century (Keynes died in 1946), possibly of all of it. In 1998, in “Two Lucky People”, the memoir he wrote with his wife, Rose, he could claim to be “in the mainstream of thought, not, as we were 50 years ago, a derided minority”, and no one could dispute it.

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