Today’s papers will be filled with tributes to the scholarly contributions of Milton Friedman, who died yesterday at the age of 94. They will note the way that the great economist invented modern monetarism. And the fact that Milton vanquished orthodox Keynesianism with a single phrase—“inflation is always and everywhere a monetary phenomenon.” Then there is how Milton inspired Paul Volcker to push interest rates to the sky to stop inflation, an event whose benefits we still see in the shape of the yield curve today. Yet there is something Friedman did that is less talked about. He showed us that free markets are humane.
Consider how Americans have viewed economics for much of the past three-quarters of a century—the period since Roosevelt blamed the Depression on “princes of property.” Americans have always understood that free-marketeers might have valid arguments. But for decades, profit was generally considered corrupting. You made money so you could move on and do good in other areas, such as government or charity. Not only Marxists, but also the mainstream believed this. In 1958 Friedman’s own academic home, the University of Chicago, published a book titled The Perils of Prosperity. Traditional market theories were perceived to be cold, anti-people.