BOOK REVIEW
BY JAMES P . PROUT
Milton Friedman : The Last Conservative By Jennifer Burns Farrar , Straus and Giroux 578 pages with photos , appendix , notes and index , $ 35
What makes Elvis Presley a music superstar ? Talent certainly helps , but other ingredients include notoriety and mass appeal . And , of course , there is staying power — impact on some part of our lives that long outlasts the artist . There are plenty of “ one hit ” wonders ; few ascend further .
Readers of this magazine probably have their own superstars : business leaders , entrepreneurs , bankers or investors . Those whose lives and work have had a lasting effect on financial markets and history . Economists are also part of this nerd parade . The field is littered with names like Ricardo , Veblen , etc . Very few make the superstar grade , including Smith , Marx ( good or bad , we are still talking about him ) and Keynes .
Professor Jennifer Burns of Stanford University , in Milton Friedman : The Last Conservative , provides some starting arguments in considering whether Friedman ought to be included as an economics superstar . After all , he gave the intellectual
OK for the “ Reagan Revolution ,” which asserts that government inhibits free markets and that tax cuts pay for themselves . He authored many books and won a Nobel Prize . He and his wife hosted an awardwinning PBS show , Free to Choose . Burns ’ book is an “ inside baseball ” approach to Friedman ’ s life and work . A recurring theme is the academic conflicts ( some important , some petty ) in and around the economics landscape of many US universities from the 1930s to the 1980s .
Friedman , born in 1912 , was a favored child of comfortable , immigrant parents . Intellectually pugnacious , he was a born arguer and a gifted student . First pursuing a career as an actuary , he caught the economics bug at Rutgers just as economics as an academic field started to mature . Mathematics began to augment the philosophical and ethical arguments that had characterized the field previously . It was a perfect marriage for Friedman . The author also highlights another important Friedman trait : all his life , he was very good at managing up , and at Rutgers he made a life-long connection with a then-professor and later Fed Chairman , Arthur Burns . ( No relation to the author , I presume ).
Obviously , 1932 was an inauspicious time to graduate from college , and Friedman moved on to graduate school at the University of Chicago , waiting tables to support himself . From there , Professor Burns goes deep into the to-and-fro within the academic world which Friedman then inhabited . There are several chapters with the comings and goings of colleagues — some friends , some not . It appears that Friedman was good at the internal battles that characterize academia . He fought , he survived and he prospered through the 1940s and 1950s .
Friedman had always been unafraid to argue his side of any economic question . Then , as now , economists disagreed over how economies should stimulate growth and employment , while not rousing inflation . Friedman was adamant that money and its availability was the key to this process , expressed in the formula MV = PY . Government fiscal activity was not the prime mover , he asserted , and in most cases produced inefficiencies that harmed free market activity . This brought him into direct conflict with Keynesians , and with the likes of the Fed ’ s William McChesney Martin and Arthur Burns . Friedman backed up his theories with a massively researched book , A Monetary History of the United States , 1867 – 1960 .
As Friedman ’ s public profile began to expand , Professor Burns writes , his views on choice , government growth , taxes , etc . dovetailed with the views of newly emergent conservative voices exemplified by William F . Buckley and Barry Goldwater . The 1970s saw his growing distance from then-Fed Chairman Arthur Burns over the most persistent and devious enemy of all : inflation . By the time Ronald Reagan was elected President in 1980 , Friedman ’ s views had worldwide impact , from Margaret Thatcher ’ s Britain to Augusto Pinochet ’ s Chile . Friedman ’ s PBS show merged presentations of his views on economic topics with vigorous debate and discussion with participants from all sides of the issue . That likely could not be done today .
Friedman ’ s arc from a schoolboy in Rahway , NJ , to the highest levels of academia and government is quite a story . Professor Burns tells it straight from the shoulder , describing his journey against the backdrop of the changing tides of economic theory and practice . As mentioned , there is a lot on the internecine academic conflicts and personalities at the University of Chicago and elsewhere . This is necessary , I suppose , to highlight that Friedman welcomed intellectual combat , but it drags a bit . Friedman must have also had a good sense of humor , as he doctored his California vanity license plates , which read MV PY , with black tape equal signs , so other motorists could see his favorite monetary formula . And , if you ’ re like me and are wondering where the subtitle of this book , “ The Last Conservative ,” comes from , Professor Burns explains it in the video from her recent event at the Museum of American Finance .
So , where do we stand today on Friedman vis-à-vis superstar status ? He died in 2006 , but his ideas on post-New Deal government and taxation are still at center stage . However , as someone said about the effects of the French Revolution : It ’ s still too early to tell .
42 FINANCIAL HISTORY | Spring 2024 | www . MoAF . org