The most important economist of 20th century

Thomas Sowell:

Milton Friedman was one of the very few intellectuals with both genius and common sense. He could express himself at the highest analytical levels to his fellow economists in academic publications and still write popular books such as "Capitalism and Freedom" and "Free to Choose" that could be understood by people who knew nothing about economics. Indeed, his television series, "Free to Choose," was readily understandable even by people who don’t read books.

Milton Friedman may well have been the most important economist of the 20th century, even if John Maynard Keynes was the most famous. No small part of Friedman’s achievement was rescuing economics from the pervasive and virtually unquestioned Keynesian orthodoxy that reigned in many places.

Ironically, Friedman began his career as a believer in both Keynesian economics and in the liberals’ vision of the world with which it was so compatible. Yet, in the end, no one did more to dethrone both. It is doubtful whether Ronald Reagan could have been elected president in 1980 without the changes in public opinion produced by Friedman’s work in the previous decades.

The Keynesians’ belief that government policy could wisely make trade-offs between rates of inflation and rates of unemployment was epitomized in the Phillips Curve, which seemed to lend empirical support to that belief. Friedman dealt that analysis a body blow when he argued that it was not the rate of inflation which reduced unemployment but the fact that inflation exceeded expectations.

In other words, even a high rate of inflation would not reduce unemployment if inflationary policies became so common as to be expected. The "stagflation" of the 1970s--with simultaneous double-digit inflation and double-digit unemployment--validated what Friedman had said, in a way that no one could ignore.

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Friedman’s own personal background made him familiar with the problems of those who begin life without the privileges of the elite--and of the importance of education as a way to advance beyond their beginnings. Born in Brooklyn in 1912 to immigrant parents, he grew up in New Jersey, living over his family’s store, and worked his way through Rutgers University. Later, he went on to postgraduate work at the University of Chicago. The rest, as they say, is history.

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More than anyone else Friedman set the stage for the modern US economy which is still the enemy of our friends and enemies. Mark Alexander also discusses Friedman's contributions toour understanding of economics.