A Fresh Look at the Apostle of Free Markets

[AlphaCentauri]

Source: NYT

Joblessness is growing. Millions of homes are sliding into foreclosure. The financial system continues to choke on the toxic leftovers of the mortgage crisis. The downward spiral of the economy is challenging a notion that has underpinned American economic policy for a quarter-century — the idea that prosperity springs from markets left free of government interference.
The modern-day godfather of that credo was Milton Friedman, who attributed the worst economic unraveling in American history to regulators, declaring in a 1976 essay that “the Great Depression was produced by government mismanagement.”

Five years later, Ronald Reagan entered the White House, elevating Mr. Friedman’s laissez-faire ideals into a veritable set of commandments. Taxes were cut, regulations slashed and public industries sold into private hands, all in the name of clearing government from the path to riches. As the economy expanded and inflation abated, Mr. Friedman played the role of chief evangelist in the mission to let loose the animal instincts of the market.

But with market forces now seemingly gone feral, disenchantment with regulation has given way to demands for fresh oversight, placing Mr. Friedman’s intellectual legacy under fresh scrutiny.



Read more: http://www.nytimes.com/2008/04/13/weekinreview/13goodman.html?em&ex=1208145600&en=76acd14a7f89733b&ei=5087%0A

[Sarah Ibarruri]

1. Good article

"The downward spiral of the economy is challenging a notion that has underpinned American economic policy for a quarter-century — the idea that prosperity springs from markets left free of government interference."

I saw the above sentence in the article and thought how much more accurate it would sound if the words, "FOR THE RICH" were interjected between the words "prosperity" and "springs."


And that the following paragraph from the same article would sound much better if the words, "TO THE RICH" were interjected between the words, "things" and "as" and quotations were placed around the words, "bad things."

“Friedman taught some fundamental long-run truths and he was adept and skilled and almost brilliant at getting them into the public domain,” said Allan H. Meltzer, an economist at Carnegie Mellon. “Now we’ve come into a crisis that has dampened enthusiasm for those policies, and we’re headed back into a period of more regulations that will do the same bad things as in the past.”

[54anickel]

8. Ironic, wasn't it Friedman who said "Only a crisis, whether actual or perceived,

produces real change"? Or something like that. So, was this an engineered crisis of some sort? Greenspan was a great follower of Friedman and also was pushing for creative liquidity instruments such as CDOs, swaps, derivatives, etc as well as being the number one cheerleader for ARMs. Now look at the massive changes being made to Fed policy....almost as if it's all by design. :shrug:

[Joe Bacon]

15. Yeah and Chile was Milton's Laboratory

I was in college when that asshole's theories began to take hold. And, yes I was forced to read his magnum opus "Capitalism and Freedom" in which Flaky Freidman said that a free market encouraged a free society...Then I saw how Kissinger let Milton's kids loose in Chile under Pinochet. Yep, that fart's legacy is there for the world to see. The Market got a lot freer, and the society became more repressive. Funny, but whenever Myopic Moron Milty was confronted about Chile, he kept saying how free Chile was under Pinochet, unlike that Godless Marxist Allende.

One can hope that our currently fucked up economy will be the stake that is driven through the heart of Mr. Free Market Milton and his Monetari$m once and for all!

[tanyev]

2. The Shock Doctrine by Naomi Klein is a blistering analysis of Friedman's policies.

It's an excellent explanation of the damage that has been done.

[Mojambo]

4. As is Ha-Joon Chang's "Bad Samaritans" n/t

[AlphaCentauri]

5. Great book!

[varelse]

3. I'm having a DUH moment here

The free market is not geared to take care of the casualties, because there’s no profit motive. There’s no market incentive to deal with the unemployed or those who have lost their homes.”

Gee, yah think??????????

:banghead:

[JDPriestly]

14. It's also not geared to educate or provide health care for ordinary people.

It is not geared for an aging society. It is not geared for providing for clean air, clean water, clean seashores and lakes, healthy forests, or beauty in any form. Friedmanites see the world as strictly material -- as do Communists. In that respect, they have a lot in common.

[AP]

19. It's not geared to deliver great benefits over the long term, or very broadly.

A return on investment that takes too long to realize or that is spread too broadly isn't attractive enough for the free market -- educating everyone well is a good example.

[Cresent City Kid]

6. The One Percent

There's a documentary called "The One Percent" made by an heir to the SC Johnson fortune. He interviews Friedman who defends the current economic policy. The selling point of supply side was that if the wealthy had their taxes cut, the money would go to investment which would help everyone by sparking the economy. The movie shows how much effort the top 1% exerts to KEEP its wealth.

The system is based on good intentions that haven't materialized. Left alone by government, the rich will put money back into the economy, and companies will treat customers fairly because it's good business, they say. What we have is a widening income gap, and payday loan companies charging 500% interest on $1000 loans.

[calimary]

9. I think that's what some folks - um - diplomatically call "trickle down." The rest of

us in the Real World know it as "Pee On." Pee on the peons.

Arthur Laffer, Mr. "Laffer Curve" of reaganomics fame, was famed for saying "a rising tide raises all boats." Well, yeah, that SOUNDS good. The problem is - what happens if you don't have a boat to begin with? What does that wonderful rising tide do for you, besides drown you or wash your shack near the shoreline into the drink?

I noted the reminder in this article about how milton friedman died in 2006. Good. That means he has a grave somewhere that, if I ever find it, I can spit on. Sorry to sound bitter (YES, Hillary and mcsame, some of us are bitter, for ourselves and/or for the many many others we see around us who have been left off the gravy train so those who already have the good seats and don't need any help can yet get more) but this whole give-more-to-the-have-more's bullshit just that. Bullshit. I guess this is the group of camels that won't be able to fit through the eye of the proverbial needle that Christ talked about. And it would be just desserts.

BTW - Welcome to DU!

[Cresent City Kid]

11. Thanks calimary

When they say the rising tide lifts all boats, I say my boat is tied to the dock on a short rope.

[calimary]

13. I'm not sure how old you are, but I remember, with bile rising in my gut, that time.

ronald reagan sold a whole lot of people a bill of goods, and a nice waltz down the garden path.

I remember the only-partly joking "Millionaires on Parade" that was one of the nicknames for the cabal of pirates and corner-cutters he attracted around him. He had a budget director who briefly tried to sell us all on the idea that ketchup qualifies as a vegetable (to save a coupla bucks on those annoying school lunches for poorer students that the taxpayer has to underwrite). That same budget director, illustrious-if-nerdy Young Turk as he was, later wrote a book blowing the cover of the whole scam. They balanced budgets and covered spending overruns with an accounting device known as the "magic asterisk" - that would account for all the holes in their piece of swiss cheese of a budget plan every year. This was the same guy on whose watch either Time or Newsweek, I forget which, ran a cover story called "And the poor get poorer." It was really a pretty pathetic time.

Meantime, Nancy Reagan was drawing bad publicity like moths to the flame, taking an image of haughty aristocratic snobbery to new heights. Word spread that she wanted the Carters to move out of the White House early so she could start redecorating. This was a rumor of the time, not necessarily ever proven more than a rumor, but that's the type of vibe she had. Marie Antoinette in Adolfo suits. She also launched a campaign to replace the White House formal china, and she picked out a red-and-white with gold pattern that cost a king's ransom. Yes, private donations funded it. But the mere notion of a First Lady fluttering around the White House gussying it up with her champagne tastes - while more Americans were falling into poverty and her darling hubby was cutting the safety-net out from under them - contributed to an overall "let 'em eat cake" aura. Not good.

It was a really shameful time. george w. bush is indeed a "son of reagan." Only on steroids, deceitful, and sneakier.

It was not a terribly good time in this country. Maybe he was having some impact abroad - although nothing much would have been accomplished in foreign policy if reagan didn't have a willing, open-minded, and remarkably accessible partner across the ocean in the so-called enemy camp: Mikhail Gorbachev. But here at home, there was little to be proud of, really. Nauseating series of setbacks. james watt - a horror-show of an Interior Secretary (!), a megalomaniac chief-of-staff/treasury secretary = donald regan (although the public spats he had, and often lost, with Queen Nancy were rawther entertaining!), the aforementioned OMB director David Stockman, and a host of others. Antonin Scalia comes to mind. And Sandra Day O'Connor - two of his Supreme Court appointees. What fun they turned out to be! Just awful. Iran/Contra, Ollie North, John Poindexter, Elliot Abrams, Ken Adelman, and a host of other rogues - AND the grand wizard and "fixer," James Baker - it was a hall of horrors from start to finish. Just AWFUL. And all kinds of foundational activity flourished under reagan - that later gave us george w. bush in his full flower. Many seeds of this dreadful time were planted during the reagan era. PATCO was disbanded 'cause he fired the air traffic controllers who were striking because their pay, hours, and working conditions were terrible, and that dealt a body blow to the union movement in general. The worker and the little guy took it on the chin. And the demons of the evangelical movement crawled out from under their rocks and gained legitimacy - and access - when reagan took over the White House. And it became just darlin' ol' fun to joke about bombing another sovereign state. Just a laugh a minute, I'll tell ya. And the rise of the CONservative noise machine and hate radio began on his watch, as well. And that's certainly been a gift that keeps on giving, wouldntcha say?

[UpInArms]

18. not to mention the death of the Fairness Doctrine began under with

the paper written by Robert Bork and Antonin Scalia

The Fairness Doctrine - How We Lost it, and Why We Need it Back

The necessity for the Fairness Doctrine, according to proponents, arises from the fact that there are many fewer broadcast licenses than people who would like to have them. Unlike publishing, where the tools of the trade are in more or less endless supply, broadcasting licenses are limited by the finite number of available frequencies. Thus, as trustees of a scarce public resource, licensees accept certain public interest obligations in exchange for the exclusive use of limited public airwaves. One such obligation was the Fairness Doctrine, which was meant to ensure that a variety of views, beyond those of the licensees and those they favored, were heard on the airwaves. (Since cable’s infrastructure is privately owned and cable channels can, in theory, be endlessly multiplied, the FCC does not put public interest requirements on that medium.)

The Fairness Doctrine had two basic elements: It required broadcasters to devote some of their airtime to discussing controversial matters of public interest, and to air contrasting views regarding those matters. Stations were given wide latitude as to how to provide contrasting views: It could be done through news segments, public affairs shows or editorials.

Formally adopted as an FCC rule in 1949 and repealed in 1987 by Ronald Reagan’s pro-broadcaster FCC, the doctrine can be traced back to the early days of broadcast regulation.

<snip>

There are many misconceptions about the Fairness Doctrine. For instance, it did not require that each program be internally balanced, nor did it mandate equal time for opposing points of view. And it didn’t require that the balance of a station’s program lineup be anything like 50/50.

<snip>

Help would come in the form of a controversial 1986 legal decision by Judge Robert Bork and then-Judge Antonin Scalia, both Reagan appointees on the D.C. Circuit of the U.S. Court of Appeals. Their 2–1 opinion avoided the constitutional issue altogether, and simply declared that Congress had not actually made the doctrine into a law. Wrote Bork: “We do not believe that language adopted in 1959 made the Fairness Doctrine a binding statutory obligation,” because, he said, the doctrine was imposed “under,” not “by” the Communications Act of 1934 (California Lawyer, 8/88). Bork held that the 1959 amendment established that the FCC could apply the doctrine, but was not obliged to do so—that keeping the rule or scuttling it was simply a matter of FCC discretion.

“The decision contravened 25 years of FCC holdings that the doctrine had been put into law in 1959,” according to MAP. But it signaled the end of the Fairness Doctrine, which was repealed in 1987 by the FCC under new chair Dennis R. Patrick, a lawyer and Reagan White House aide.

[Cresent City Kid]

20. I was 18 in 1984

I entered the work force just as Reaganonmics was getting under way. In his re-election campaign, he asked if I was better off than 4 years before. I said, "No, 4 years ago I had an entree with my potato at dinner."

[struggle4progress]

7. Ronnie presided over depression-era levels of unemployment and loss of US manufacturing base

A few stock market speculators and financial manipulators did well, but lots of people lost bigtime in the stock-market crash towards the end of Ronnie's term II

By the time, Bush the First was leaving office, it was clear that some con artists had made themselves very wealthy with deregulated Savings and Loan scams, while taxpayers got stuck with a half-trillion bailout

Another Republican "success"

[ShockediSay]

10. Sure, the economy expanded, but not the median family income,

which was pretty much frozen.

In fairness, the same can be said of Clinton's "economic
expansion."

[gratuitous]

12. Yep, free markets . . .

Lifted the burden of those fucking savings and loans off the backs of Americans in the 1980s. With a major financer of home mortgages out, it fell to other folks to turn the dull home mortgage industry (I mean, shit, all that was happening were some people were buying homes at reasonable interest rates!) into a very exciting game of luck, chance, a smidgen of skill, and the shafting of millions of investors. Now that's some free market goodness!

I suppose you all enjoyed the way airplanes used to take off and land on time, too? And how sometimes those planes weren't jammed full with every last seat occupied? Well, the free market took care of that, too. You don't mind making every flight go through Phoenix, Denver, Dallas, St. Louis, Minneapolis, or Atlanta, do you? Even if you're flying from Boston to Charlotte or Portland to L.A.? Is it really that inconvenient to change planes twice?

[Caradoc]

16. A classic human mistake....

...in all things is assuming that 'one size fits all.' Friedman was a proto neo-con, not a libertarian. And despite all of the academic trappings, his economic outlook is clouded by that most conservative of weaknesses, an overwhelming desire for easy answers to complex questions. When will people, and their governments, finally understand that, if indeed we really are 'free' as individuals, one size does not fit all. Like Pharoahs in ancient Egypt, Grover Norquist should have been buried at friedman's feet, thus ensuring the end of this particularly near-sighted, overly simplistic and anti-social economic philosophy.

[fasttense]

17. The idiot Friedman like to talk as if he knew something but he never

learned from history.

This free trade crap was first introduced to America in 1913. Tariffs were cut and income tax was introduced. This led to the roaring 20s and eventual collapse in the republican Great Depression. He leaves that obvious fact out of his books.

Income tax and Depression are the everlasting gifts of free traders to Americans.

Friedman knew this but decided to line his pockets by aligning himself with the idle rich. He provided justification for CEOs and politicians to con and steal from Americans. Now we are back to the cycle of a Depression again brought on by yet another group of money hungry republicans.

Friedman was one of the biggest damn liars ever to evolve.

[brentspeak]

21. And Friedman acolytes will always call Friedman critics "anti-capitalists"

Occasionally, the Friedman tools will just come and say it directly: if you don't drink the free market kool-aid, then you're a "communist".

[fascisthunter]

23. or a Dictator

[fascisthunter]

22. How Many Would Consider Friedman to be a Fascist and Not a Capitalist?