One of the books I am reading is I Am John Galt by Donald Luskin and Andrew Greta. I’d like to share something I read recently in that book about the late Milton Friedman, one of the greatest economic minds of our lifetime.
In 2004, at 92 years of age, Milton Friedman was still using his talent of being down-to-earth and using layman terms to explain the economic model of capitalism versus socialism. The following are his words from a news interview he did in May of that year while explaining the basic construct of government spending…
“There are four ways in which you can spend money. You can spend your own money on yourself. When you do that, why then you really watch out what you’re doing, and you try to get the most for your money. Then you can spend your own money on somebody else. For example, I buy a birthday present for someone. Well, then I’m not so careful about the content of the present, but I’m very careful about the cost. Then, I can spend somebody else’s money on myself. And if I spend somebody else’s money on myself, then I’m sure going to have a good lunch! Finally, I can spend somebody else’s money on somebody else. And if I spend somebody else’s money on somebody else, I’m not concerned about how much it is, and I’m not concerned about what I get. And that’s government. And that’s close to 40% of our national income.”
The book also mentions an interview (video below) between Milton Friedman and Phil Donahue on the Phil Donahue Show which makes a clear case in support of capitalism above all other forms. Friedman schools Donahue on why capitalism is the only true moral system among men and that the evidence is crystal clear that all the suffering around the world that exists today, exists only in countries that deviated from capitalism and economic freedom.
Towards the end of the video, Friedman points out that political self-interest is not nobler than economic self-interest.
In my own words, let me expand on this idea. Economic self-interest is what liberals like to call “greed.” We are all motivated by economic self-interest. That is why we work, why we go to school, why we earn a living and try to get promoted and increase our income. This is obviously not a bad thing. If it is, then ask yourself to define the alternative? Laziness? Living off of others hard work? Then consider that we are motivated by self-interest just as politicians are. They have political self-interest in proportion to our economic self-interest. They want what is best for themselves no different than how what we want is best for ourselves. So returning to Friedman’s statement, “…what makes political self-interest nobler than economic self-interest?”
To me, in the former, only the politicians stand to gain regardless of the people and what they want, while in the latter each and every individual stands to gain, regardless of the politicians and what they want. So which system do you want? The current one where political self-interest is in control and every aspect of our lives is subject to political and government oversight, intrusion, regulation, taxation and redistribution as the politicians see fit, to reward their own self-interest? Or the system we used to have, where individuals are free to pursue their own economic self-interest, their own “greed,” without government intervention, intrusion, or control? Which system is best for freedom? Which system is best for you? You know the answer.
Once you understand what greed is and what the alternatives to greed are…you realize that greed is in fact…good, just like Gordon Gekko said it was. Friedman points this important fact out to Donahue in the video below.