Milton Friedman Speaks: What is Wrong with the Welfare State?

Milton Friedman (July 31, 1912 - Nov 16, 006) was an American Nobel Laureate economist and public intellectual. He made major contributions to the fields of economics and statistics. In 1976, he was awarded the Nobel Prize in Economics for his achievements in the fields of consumption analysis, monetary history and theory, and for his demonstration of the complexity of stabilization policy. He was an advocate of economic freedom.Show more

According to The Economist, Friedman "was the most influential economist of the second half of the 20th century...possibly of all of it". Former Federal Reserve Board chairman Alan Greenspan stated, "There are very few people over the generations who have ideas that are sufficiently original to materially alter the direction of civilization. Milton is one of those very few people."

The welfare state is an attempt to “do good” with someone else’s money. The aim may be worthy but the means are faulty. The problem is that you do not spend someone else’s money as carefully as your own. More to the point, it’s impossible to “do good” with someone else’s money without first taking it away from someone else. That implies coercion—the use of bad means to corrupt the good ends of the welfare state. Welfare programs implicitly encourage competition for government funds and create unfortunate divisions and antagonisms in our society that erode individual freedom. We must find other means—voluntary cooperation and private giving, for example — to achieve our objective. Recorded at University of Rochester

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