Milton Friedman's influence is vast, and many of his ideas continue to be reflected in various aspects of American economic policy, thought, and society. Here's a list of positive influences from Friedman that are still evident in America today:
- Monetarist Policy at the Federal Reserve: Friedman's emphasis on the importance of stable monetary growth and his critique of the Federal Reserve's role during the Great Depression has deeply influenced modern central banking. The Federal Reserve today often focuses on controlling inflation—reflecting Friedman's view on the paramount importance of monetary stability.
- School Vouchers: Friedman was a staunch advocate for school vouchers, arguing they would introduce market competition into the public education system, benefiting students and families. While the U.S. hasn't adopted a nationwide voucher program, many states have implemented or considered voucher-like programs or education savings accounts, reflecting his influence on educational policy debates.
- All-Volunteer Military: Friedman argued against the military draft and in favor of an all-volunteer force, believing that conscription was inefficient and infringed on personal freedom. Today, the U.S. maintains an all-volunteer military force.
- Negative Income Tax: While the U.S. has not implemented a full negative income tax as Friedman proposed, the Earned Income Tax Credit (EITC) can be seen as a version of it. The EITC provides support to low-income individuals, particularly those with children, echoing Friedman's aim of ensuring a basic income without disincentivizing work.
- Deregulation: Friedman's skepticism of excessive government regulation influenced the deregulation wave in the 1980s and 1990s. Many sectors, including airlines and telecommunications, were deregulated, leading to increased competition and often resulting in lower prices and more choices for consumers.
- Emphasis on Economic Freedom: Friedman's belief that economic freedom is a prerequisite for political freedom and general well-being continues to shape American economic and foreign policy. His ideas can be seen in American support for free trade, property rights, and market-based solutions domestically and internationally.
- Limited Government Intervention: The general trend towards favoring policies that limit government intervention and emphasize individual choice and responsibility can be attributed in part to Friedman's arguments for the benefits of a free-market system over a centrally planned one.
- Influence on Economic Education: Friedman's books, such as "Capitalism and Freedom" and "Free to Choose," are still widely read in economics courses and by the general public, continuing to introduce generations to his views on the benefits of market capitalism.
- Tax Policy: Friedman was a critic of complicated tax systems, advocating for simpler tax structures. While the U.S. tax code remains complex, the emphasis on simplifying it, as seen in various tax reform efforts, can be traced back to his influence.
Milton Friedman's intellectual contributions coincide with one of the most prosperous periods in American history, a testament to the transformative power of his economic philosophies. His emphasis on monetary stability paved the way for the Federal Reserve's policies that have, in many instances, successfully navigated inflationary threats and economic downturns. His advocacy for deregulation was realized during the 1980s and 1990s, leading to innovations and consumer benefits in sectors like airlines and telecommunications. Moreover, his belief in economic freedom and limited government intervention aligned with an era marked by rapid technological advancements, the rise of Silicon Valley, and an unprecedented growth in global trade. While discussions about his recommendations continue, there's an undeniable connection between Friedman's ideas and the economic dynamism that has characterized the U.S. in recent decades. His legacy is not just in the theories he propounded, but in the tangible prosperity that millions have enjoyed as a result.
