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Source link: http://archive.mises.org/3704/friedman-and-socialism/

Friedman and Socialism

June 10, 2005 by

On an email list, Milton Friedman was referred to as a socialist, and Pete Boettke responded,

Let’s be honest with ourselves. Friedman is not a socialist, he is a free market advocate who is thinking pragmatically and not just on first principles. He agrees with you that if we could abolish the state in education we would be better off, but since that is not going to happen tomorrow he is thinking of marginal steps that could be made that would move the ball forward. We can disagree with him, but what possible gain is to labeling him something which he is obviously not and when we do so just reinforces our isolation in the intellectual world?

In my view, socialism is best defined along the lines Hoppe did in A Theory of Socialism and Capitalism (p. 20), that is, as institutionalized interference with or aggression against private property and private property claims. This definition seems to get at the essence of what socialism is; it is basically public, or institutionalized, crime. Applied literally, any state at all, even a mininal one, is “socialistic” to a certain degree, since states necessarily commit aggression. Therefore, according to this definition, anyone other than an anarcho-libertarian is to a degree a socialist–even a minimal stateser. Certainly all those outside the anarchist/minarchist camps are advocates of socialist policies and institutions, to a degree.

As far as I know, Friedman advocates and has played a role in instituting various measures that amount to institutionalized aggression against private property, e.g., income tax withholding, the “negative” income tax, educational vouchers (arguably), etc. These measures are clearly socialistic as are, no doubt, others Friedman advocates, so whether he is “a socialist” or not I do not know, but he seems at least to be an advocate of some socialistic policies. Like many people, he is a mixed bag–he advocates many libertarian institutions, but dilutes this by also advocating some socialistic ones. Now he is certainly not the more extreme or principled or consistent type of socialist that advocates full-blown socialism.

socialism_graphIf you had to draw a graph, I would say the degree of socialism increases monotonically as the size of the state one advocates increases, where the left side would be zero socialism corresponding to zero state (anarchy), and the right side is 100% socialism corresponding to extreme communism or totalitarianism. Anarcho-libertarians are at the left axis. Close to them, with a small degree of socialism, are minarchists. Next you would have classical liberals and Friedmanesque mainstream free market advocates. Then you have your welfare state/mixed economy types, followed by more outright advocates of full-blown socialism, commies, and totalitarians. (See this amateur graph illustrating this.)

What we have “to gain” by admitting this, other than accuracy, honesty, and truth, I am not sure. Are these not enough? Does everything have to be gauged by strategic considerations? I think not.One other point. While I cannot help but admire Friedman’s general pro-free market message and work, I was struck by a passage in something he wrote in his July 1991 Liberty article, “Say “No” to Intolerance”. I don’t have a copy any more (if anyone does, please fax it to me at 281-966-6988 and I can post it) but I recall he said that he was in favor of liberty and tolerance of differing views and behavior because we cannot know that the behavior we want to outlaw is really bad. In other words, the reason we should not censor dissenting ideas is not the standard libertarian idea that holding or speaking is not aggression, but because the we can’t be sure the ideas are wrong. This implies that if we could know for sure what is right and wrong, it might be okay to legislate morality, to outlaw immoral or “bad” actions. This line of thinking has always bothered me a great deal, more so than the fact that Friedman, like most free market proponents, compromises on this or that concrete issue.

For some discussion of Friedman’s libertarian views, see Rothbard’s 1971 piece Milton Friedman Unraveled, and Laurence Vance, The Curse of the Withholding Tax.

Update: see also Hoppe, “The Western State as a Paradigm: Learning from History“; Friedman, Milton and Block, Walter, “Fanatical, Not Reasonable: A Short Correspondence Between Walter Block and Milton Friedman (on Friedrich Hayek).”

Update: I have located a copy of the article; it is here. In this article, Friedman writes:

I regard the basic human value that underlies my own [libertarian] beliefs as tolerance, based on humility. I have no right to coerce someone else, because I cannot be sure that I am right and he is wrong.

… If we see someone doing something wrong, someone starting to sin (to use a theological tern) let alone just make a simple mistake, how do we justify not initiating coercion? Are we not sinning if we don’t stop him? Only two bases for a negative answer occur to me that make any sense. One–which I regard largely as largely an evasion–is that there’s no virtue in his not sinning if he’s not free to sin. That may be true. But then, that doesn’t apply to me. It may be no virtue for him. That doesn’t mean I should let him sin: am I not sinning when I let him sin? How do I justify letting him sin? I believe that the more persuasive answer is, can I be sure he’s sinning? Can I be sure that I am right and he is wrong? That I know what sin is?

Note also that this article is one of the sources where Friedman alleges Mises stormed out of the Mont Pelerin Society meeting in 1947, during a discussion about the progressive income tax, exclaiming, “You’re all a bunch of socialists.” He also reiterates his positivist methodology, and opposition to Misesian praxeology in economics and Randian principle in libertarianism and philosophy. Based on his “tolerant” (read: unprincipled) views, he again reiterates his support for educational vouchers and the negative income tax.

Friedman was a great libertarian (in fact he was one of the main three or four influences on my own libertarian development), but this is not him at his best.


Gil Guillory June 10, 2005 at 3:56 pm

On this defense of free speech, Friedman paces JS Mill in On Liberty. Mises similarly defends freedom for all artists and entrepreneurs in The Anti-Capitalistic Mentality.

Roderick T. Long June 10, 2005 at 4:46 pm

Mill is often referred to as having argued for toleration on the grounds that we can’t know for sure which views are right or wrong, but I think that’s a misinterpretation of On Liberty. What he actually says in On Liberty is that we can (at least sometimes) know for sure which views are right or wrong, but our ability to know this depends on an open forum of free competition in ideas; it’s only when a view is permitted to be criticised that we can be justified in inferring that it is its truth, rather than its legislated immunity from criticism, that has enabled it to stand up.

Voice of Reason June 10, 2005 at 5:21 pm

If advocating a realistic reduction in current government interference (and a corresponding increase in individual choice in the marketplace), is still being a socialist, then what about someone who works for a corporation which obtains any measure of government help in the marketplace (ie, every corporation in existence)? Are they socialists too? This is kind of like the crazy arguments against libertarianism some make – “well you use the postal service, you are violating your own principles!”.

I’d love to live in a world full of socialists like Milton Friedman.

Stephan Kinsella June 10, 2005 at 6:12 pm

Voice, it does not seem to me that advocating a reduction in statism is socialistic at all (whether the reduction is “realistic” or not). Advocating lowering the marginal income tax rate by 1% is advocating something that is an unambiguous improvement.

However, advocating a voucher system is less unproblematic, since it means increasing the amoung of redistribution wealth (since more people would have their kids’ education funded by the state than in a mixed public/private system, where the private school customers are not being subsidized), and also increased state control over private school.

Using the existing statist-controlled infrastructure (e.g., post office, roads, flood insurance) is not the same as advocating these programs. It could be argued that those who oppose such government programs–i.e., libertarians–are its only victims, and thus the very ones who are entitled to use public services, welfare, and the like–it’s just restitution. Whereas, for those who support the state, they are getting what they ask for, so they are owed no restitution. It’s okay to tax a democrat, in other words; it’s not theft, because he consents to it.

I agree some try to argue against libertarians by arguing they are hypocrites for living in the real world. I would say we have no duty to be martyr. And blaming the victim is not acceptable. It is akin to these despicable liberals who go apoplectic whenever a black opposes affirmative action–how dare they oppose it, when they are beneficiaries of it, the arguemnt goes. This is one of the most evil arguments I have ever heard. It is trying to trap people not only into being subject to imposed rules, but to keep them from even objecting to it. If’s not enough for these evil people that they can force us to abide by their laws, pay tribute to their immoral causes–they want to use that against us even complaining about it. It is unacceptable. It is blaming the victim.

I, too, would love to live in a world of Milton Friedmans. But just because he is a huge improvement over the average person’s political sensibilities does not mean that he does not endorse some socialistic policies, and that this should be condemned, or at least recognized for what it is. It is a separate question about whether he has been good for liberty or whether he is a good guy or a hero to us (he is, in my view).

I will frankly admit that I believe everyone who is not an anarcho-libertarian is to an extent an advocate of socialism, statism, and public criminality. That is just a consequence of being an anarchist. Every minarchist libertarian necessarily believes that any advocate of state programs beyond the night-watchman state is to that extent an advocate of criminality. That does not mean we can’t be allies with or respect such people. It does not mean that the people near the left side of my chart can’t be considered in general advocates of freedom or allies. But it does mean that some of them unfortunately do advocate, to a small degree, the very crime they usually condemn.

Ike Hall June 10, 2005 at 10:42 pm

If the goal is a libertarian society, one does not get there by compromising in the direction of increased statism.

Friedman may be a vocal advocate for increased economic liberty, but what about that little brainstorm of his called the withholding tax? With friends like this, who needs neo-cons?

P.M.Lawrence June 10, 2005 at 11:01 pm

The MF arguments about “cannot know” are perfectly consistent with a more fundamental approach to liberty, once you realise that these things are intrinsically unknowable, at least short of a religious afterlife. It’s merely approaching the same concept from a direction that makes it more understandable to the unconverted – no point only preaching to the choir.

The withholding tax as implemented in the USA may well have owed a lot to MF, but it was not really his invention. It’s nothing more than a US variant of the British PAYE (“pay as you earn”) system, which was implemented independently. Both originated in ideas that were circulating at the time.

Concepts like negative income tax and school vouchers are not inherently socialistic, but can be used – if the political will is there – as part of a transition. The transition goes on to monetising the entitlements (using monetised vouchers for NIT too), then providing the subsidies from independent funds which get genuinely (not fake) privatised, and finally parcelling out the funds as individual or family holdings backed by institutional reforms that stop them being dissipated over generations. It’s a matter of getting the government out of the loop incrementally.

For what it’s worth, the basic income idea can be handled as part of a (clumsier) transition in a similar way, as can Professor Kim Swales’s idea of an employment tax break carried on the back of a goods and services tax. I favour a variant of the latter myself, because it is fast acting enough for the first stage of a transition; I discuss this area at my publications page http://member.netlink.com.au/~peterl/publicns.html.

Dewaine June 11, 2005 at 12:38 am

I like Stephan’s graph of socialism, and it is helpful for some purposes. But it is also somewhat misleading, because those who want some gov’t intvervention are 100% socialist in the areas where they want gov’t.

For example, someone who wants gov’t only in the businesses of policing and education is 100% socialist in these two specific areas. This may seem like an unnecessary detail to define, but not for someone whose job is related to security or personal protection, or teaching; to such people it makes all the difference in the world.

A person who argues for such “limited” gov’t intervention either (A) wants his own job protected by the gov’t by his being employed by the gov’t (making his entirely livelihood 100% socialized), or (B) wants other people to subsidize his/her chosen good or service (making his entire supply of this good or service 100% socialized).

Therefore, an anti-socialist (anarcho-libertarian) who happens to work in one of the targeted socialized professions cannot live in a “partially” socialized world; for someone whose job has become government-owned, even if it is only one of a few socialized industries, the whole society may just as well be socialist (except that the entire society would be even more impoverished.)

– Dewaine

Pieter Cleppe June 12, 2005 at 7:33 am

Mr. Kinsella,

you say: “states necessarily commit aggression”.

Some states create MORE aggression than others.

I think the reason for that is the extent to which they are allowed to do so. In Russia, people are accustomed to a very bad state, and accept this. In the West, people aren’t accustomed to that.

The US is founded on the English liberal tradition, as well this other liberal tradition: the one of the middle empire under Lothar (on the grandsons of Charlemagne, who got the middle empire, which was hard to govern. The consequence was an emergence of small states, and a lot of freedom: the low countries, Eastern France (Lyon, Provence-côte d’Azur), Western Germany, Switzerland and Northern Italy).

A mentality of not accepting violations of rights was founded there.

Splitting of countries, and gradual promoting of this mentality is the way that should be promoted, not the immediate abolishment of the state. This wouldn’t work, as it would be immediately replaced by people not respecting rights, as the mentality hasn’t already changed.

Stephan Kinsella June 12, 2005 at 8:03 am

Pieter–perhaps the Americans are “less used” to a bad state, but on the other hand, we are indoctrinated with this democracy nonsense, with the idea that since we vote, “we” are the government, and really, have no right to complain since “we” are really governing ourselves. In other words, having a democracy blurs the distinction between ruling class and ruled, and thus allows the former to get away with more (more taxes, etc.) than they otherwise could.

Alex June 12, 2005 at 1:00 pm

I can see what Professor Boettke is saying – Friedman is not a socialist, but I don’t think he’s a classical liberal, either.

Barring arguments for whether or not the State is needed (I for one think that a decentralized State coupled with laissez faire capitalism is probably the best solution to many of the moral and economic problems in our country right now).

I suppose one could say that Friedman is more ‘pragmatic’ in how he deals with problems, but herein lies the rub where I really disagree with Boettke. You can’t argue to abolish something by doing it in incremental steps – it should be all or nothing.

If he’s arguing for reductions in the State, he’s doing a good job – and many of his articles have been about this. But it’s frustrating to see him argue on pragmatic lines – this is something that politicians and reformers do, no abolishers. It slows real changes down, as it makes compromises with people who are in the middle of the road (like politicians) and don’t want to see major changes happen, or don’t want to see major changes happen quickly.

Conservatives have gone down this line too. They really say that they don’t want public education – but since that’s ‘too far out there’ they propose reforming it. Same with the current ‘private’ social security accounts – about as nonsensical as the idea of Jewish Nazi’s.

This is excellent for politicians, as it slows down real change for minor changes that people can feel ‘safe’ with. That is one of the biggest weapons that politicians use. It’s much easier for people to struggle with problems that they already have than try to tackle the unknown.

One of the biggest problems that we have in America is the middle of the road approach. Everywhere you see, people agree to disagree on everything, setting up political compromises that only slow the wheels of change down, don’t really satisfy anyone, and betray the principles that reasonable men have laid down.

I’m not so much as angry at Friedman as I am disappointed with him. His compromises with the State only hurt real market reforms.

The biggest threat of political and intellectual isolation in the world is people like Friedman, not people who become upset for his compromises.

Ironically, given the good Professor Boettke’s statement, it’s actually Friedman who isolates poeple such as real Austrians (like Boettke) who take up classical liberal viewpoints. By trying to be the ‘middle man’ in free market ideas, Friedman has basically made anyone who disagrees with him a total radical lunatic; the press go to someone like him for a watered down view of market policies, and think him to be midly radical. What happens when Friedman is considered radical by the mainstream? People like Boettke, and other Austrians are deemed lunatics.

Friedman, in his own way, does more to isolate Austrians and their ideas for reformation in this country than a small, barely audible sect of frustrated Austrians do by disagreeing with him.

Just some ramblings… feel free to ignore them.

sam June 12, 2005 at 6:46 pm

It’s much easier for people to struggle with problems that they already have than try to tackle the unknown.

So real change must come from internationalist, they have overcome the competition between states. When a mediator gets two good idea from the debators, then it has to choose not by spliting both in piece but how can you make a solution when two people have different dreams.
There are needs for martyrdom(autonomous auto-determination) and needs for socialism (shared solution to die in abundance), depending on your view of death. Both needs to become objective depending on the envirronement they face.

Socialism must come but capitalism must prove the diversity of solution by trying it before having the agreement of the competitor.
Capitalit can be an exemple of willingness to make it evolve by the way leadership is taken, socialist can be an exemple of open mind by the way they share their concerns on a common problem.

Paul Edwards June 13, 2005 at 12:53 am

Stephan Kinsella’s observation that “…we are indoctrinated with this democracy nonsense, with the idea that since we vote, “we” are the government, and really, have no right to complain since “we” are really governing ourselves” is right on the money. And where this indoctrination comes into play in a most spectacular way is when people defend Washington’s foreign policy. Criticizing Washington’s foreign policy can obtain responses almost as if the responder had personal input into Washington’s planning.

People are sure reluctant to come to grips with the fact that the government is not by any means of, or for the people. It is of and for itself and a small group of favored and privileged individuals. When Washington drops a bomb and kills civilians in a foreign land, you’ll hear it: well it was either “us” or “them” and “we” had to make that tough decision for “our” own self defense. The truth is the opposite. Each act of Washington initiated aggression puts the American citizen’s life at more risk and here’s the fact: Washington is quite OK with that.

Zach June 13, 2005 at 3:03 am

Mr. Kinsella’s graph is completely ridiculous, it reminds me of this graph (taken from the home page of OkCupid):

The Sky is the Limit.

Secondly, States do not necessarily commit aggression. In a world in which no crimes are committed, a anarchy is indistinguishable from a minarchy. That is to say, in a minarchy where no crimes are committed, the minimal State has no reason to convict or punish anybody. This is how anarcho-liberatrianism and minarcho-libertarianism can be reconciled under the libertarian umbrella.

Otherwise what is the point of calling minarchists libertarians, if according to Mr. Kinsella they do not subsribe to the libertarian principle of non-initation of force.

Thirdly, I find Mr. Kinsella’s rigidness and doctrinariness somewhat annoying.

Paul Edwards June 13, 2005 at 3:38 am

Zach: In a world in which no crimes are committed, could we also say that a law abiding citizen is indistinguishable from a criminal? I suppose we actually could, but i’m unconvinced that helps us sort out the actual differences in this actual world in which we live.

Given the world in which we do live, would we all agree that states necessarily do in fact commit aggression? Taxation is aggression. And after all, the power to tax is the essence of the state.

Paul Edwards June 13, 2005 at 3:54 am

On the other hand, Stephan: What do you think of Rothbard’s model (which contrasts with your graph a bit) of socialism being a “…confused middle-of-the-road movement, influenced historically by both the libertarian left and the conservative right”? From discussions i’ve had with the few civil-libertarian statist types i know, this model seems to explain their confused arguments that the government is needed to uphold civil liberties, and yet their observations of how government, at the same time, always seems to be trampling them, or helping others to.

tz June 13, 2005 at 9:34 am

The liberty continuum is misdefined – Enforcement of rights is either entirely individual (at the anarchic pole), or entirely collective (at the socialist pole).

At the left end, I have to protect my own life, liberty, and property, or hire proxies to do this for me (and worry about someone bidding higher as honor and integrity become commodities that might be best sold short). But I can do anything I am not actively prevented by someone else from doing including building a WMD in my basement.

At the right end, I can’t do anything without first getting permission from the collective, be it a dictator, or an internet democratic plebiscite.

Might I suggest that there might be a golden mean along this spectrum – somewhere close to what the Founding Fathers came up with (and we slid down the slippery slope to the right, though slowly – the French Revolution slipped left and quickly).

As to Friedman, his error is not that he is a socialist, good or bad. He is trying to get a scorpion not to sting, as in his attempt to get a negative income tax in the ’70s. He had to testify against it since it was hijacked to be worse than the original. That behavior is not accidental nor subject to remediation. Vouchers can easily end up worse than public education (think about requiring certification or other standards for homeschoolers or religious education which would not be added with vouchers). Reducing taxes 1%, while raising the defecit 2% is counterproductive. Removing 1% monetary tax, but in order to get the 1%, you must be subject to a 10% regulatory equivalent tax, you’ve lost.

Friedman is the original “trust the government” or “big government” republican – we elect them and some expected them to actually cut government. They didn’t. They won’t.

Friedman, though not unique in this, assumes “this time it will be different”.

billwald June 13, 2005 at 10:38 am

Agree that the degree of economic socialism is directly related to size of population of the taxing agency. Therefore the solution is to decrease the population of the taxing agencies.

To this end, the USofA should be divided into at least 5 independant nations, each having access to the sea lanes.

Zach June 13, 2005 at 2:39 pm

Paul Edwards:

Given the world in which we do live, would we all agree that states necessarily do in fact commit aggression? Taxation is aggression. And after all, the power to tax is the essence of the state.

The word “necessarily” means “in all possible worlds” in logic, not “given the world in which we live”. My claim is that States do not necessarily (= in all possible worlds) employ aggression, as I explained previously.

Michael June 14, 2005 at 10:44 am

Zach: So there are some possible worlds where the state does not use force or the threat of force to compel citizens to behave in certain ways (pay taxes, drive a speed limit, not kill each other)?

If so, then why would it exist in the first place?

Alex June 14, 2005 at 11:47 am

I hope this discussion doesn’t boil down to anarchists versus minarchists again – I think both camps should be somewhat united in their efforts against the big mega state. Minarchists are shy of being anarchists, and anarchists are shy of being minarchists.

Heck, we can even ally ourselves with more regular folks like Bill Wald who want to divide the State up into pieces.

The first thing that we should look into is secessionism. It’s simply too much trouble and work to try to reform the big, bulk mass of laws and agencies in our country. Secession works better, and, we have a better chance of abolishing things on local level than we do by convincing millions of people who are either too ignorant, unwilling, or comfortably Statist in their views to join us.

Stephan Kinsella June 14, 2005 at 1:52 pm

Alex– “I hope this discussion doesn’t boil down to anarchists versus minarchists again – I think both camps should be somewhat united in their efforts against the big mega state. Minarchists are shy of being anarchists, and anarchists are shy of being minarchists.”

Well, this comment is from the perspective of the activist who is always thinking in terms of strategery. Some of us are more interested in substantive truth of ideas and positions. We can have a division of labor.

“The first thing that we should look into is secessionism.”

You may notice that many mainstream type of libertarians are hostile to the idea of secession; they accuse those of us who favor it of being supporters of the Confederacy and slavery. I have no use for those PC dimwits.

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