Capitalism and Freedom

Context

Capitalism and Freedom was published nearly two decades after World War II, a time when the Great Depression was still in collective memory. Under the Kennedy and preceding Eisenhower administrations, federal expenditures were growing at a quick pace in the areas of national defense, social welfare, and infrastructure. Both major parties, Democratic and Republican, supported increased spending in different ways. This, as well as the New Deal, was supported by most intellectuals with the justification of Keynesian economics. Capitalism and Freedom introduces the idea of how competitive capitalism can help to achieve economic freedom.

The book drew inspiration from a series of lectures Friedman gave in June 1956 at Wabash College.

Chapter summaries

:Introduction

:i. The Relation between Economic Freedom and Political Freedom

:ii. The Role of Government in a Free Society

:iii. The Control of Money

:iv. International Financial and Trade Arrangements

:v. Fiscal Policy

:vi. The Role of Government in Education

:vii. Capitalism and Discrimination

:viii. Monopoly and the Social Responsibility of Business and Labor

:ix. Occupational Licensure

:x. The Distribution of Income

:xi. Social Welfare Measures

:xii. Alleviation of Poverty

:xiii. Conclusion

Influence

The effects of Capitalism and Freedom were great yet varied in the realm of political economics. Some of Friedman's suggestions are being tested and implemented in many places, such as the flat income tax in Estonia (since 1994) and Slovakia (since 2004), a floating exchange rate which has almost fully replaced the Bretton Woods system, and national school voucher systems in Chile (since 1981) and Sweden (since 1992), to cite a few prominent examples. However, many other ideas have scarcely been considered, such as the end of licensing, and the abolition of corporate income tax (in favor of an income tax on the stock holder). Though politicians often claim that they are working towards "free trade", an idea the book supports, few American politicians have considered taking his suggestion of phasing out all tariffs in 10 years. Nevertheless, Friedman popularized many ideas previously unknown to most outside economics. This and other works helped Friedman to become a household name. The Times Literary Supplement called it "one of the most influential books published since the war".

Capitalism and Freedom, along with much of Friedman's writing, has influenced the movement of libertarian philosophy in America. Friedman's philosophy of economic and individual freedom has coincided with the emergence of political parties that have declared alignment with Friedman's ideas, such as the Libertarian Party.

Capitalism and Freedom made the Intercollegiate Studies Institute's 50 Best Books of the 20th Century and also was placed tenth on the list of the 100 best non-fiction books of the twentieth century compiled by National Review. In 2011, the book was placed on Time magazine's top 100 non-fiction books written in English since 1923.

References

References

1. 1992 edition preface of ''Capitalism and freedom'', p. xi of the 2002 edition
2. "Capitalism and Freedom".
3. Hewitt, Howard. (November 16, 2006). "Economist Friedman Cited Wabash Lectures in Famous Text".
4. Milton, Friedman. (1992). "Capitalism and Freedom". University of Chicago Press.
5. Martin Carnoy. (August 1998). "National Voucher Plans in Chile and Sweden: Did Privatization Reforms Make for Better Education?". Comparative Education Review.
6. (February 27, 2012). "From Capitalism and Freedom to Free to Choose – Milton Friedman's defense of liberalism – Bleeding Heart Libertarians".