Milton Friedman - Is Capitalism Humane? (Q&A)



first you talk about the injustice –is which in which prevail in the so-called communist countries and then the free societies which exist in the capitalist countries and the wealth that has been created there but you restrict your arguments to the Western European countries the United States and Japan what you fail to point out is that most of the countries in the world are capitalist that is the means of production are owned privately or the accumulation of wealth is privately accumulated most of these countries have severely repressive governments and most of them suffer from huge unemployment rates hunger and poverty if we look at India as compared to China which has twice as many people and under its system the Chinese system has been able to achieve things for the masses of people which India could not even consider the same thing goes would you come to your question about just two more points because I've excuse me I'd like a little bit of free speech myself we don't want to deny you free speech we don't have any money cheaper less passed a queue very much I think we agree reduce so let me finish okay the problem which a lot of us feel is first you did not mention in terms of the countries you were pinpointing such barbarous countries the South African Zimbabwe and in terms of giving your appraisal of the riches that have been accumulated in the Western so-called democracies capitalist democracies I would like you to give us an honors the value of evaluation of just how these countries got so rich so quick and that direct relationship of that to the fact that there were slaves that worked free labor and the wealth that was created in this society being a direct product of that relationship and also of the colonial relationships of the Western European countries and the wealth which they bled out of the people in their colonial domain I will be glad to answer those first of all as a sense in which every country in the world is capitalist Soviet Union is capitalist every country in the world has large capital under control and the real question is of course the organization whereby the capital is controlled in the Soviet Union it is controlled by the state or by officials of the state in the second place I have been talking for an hour I would like to talk to you for 10 hours in a full discussion I would certainly agree with you that capitalism is not a sufficient condition for freedom it's a necessary condition for freedom I never said that wherever you had capitalism you had freedom I never said that I never made that statement I made the opposite statement wherever you had freedom you had capitalism capitalism is a necessary condition for freedom but not a sufficient condition for freedom in addition you need relatively broad access to capital in a relatively free market again relatively unique competition I usually refer to it as competitive capitalism to distinguish it from certain kinds of systems which have been capitalist and have all of the bad qualities that you described in the second place because I want it don't want to take too much time to go to your final points in the second place it simply is not true that the enormous increase in the well being of the free countries of the West arose out of slavery slavery was a blot on our discussion there is no question and of course it was a disgrace to this country to have had slavery as long as it did but if you take Britain which did not have slavery if you I'm going to go to the colonies that's the next point I'm trying to take one point at a time the gentleman made two separate points one had to do with colony one had to do with slavery and wanted to do with colony Britain did not have slaves Japan did not have slaves in the hundred years since the Meiji Restoration Hong Kong today does not have slaves and you asked yourself if you want to know how people feel ordinary people feel about different systems you ask how they vote with their feet and you ask whether it's Hong Kong that has to put up police to keep people from Hong Kong going into China or it's China that has to put up police to keep people from China going into Hong Kong so look at the way people vote with their feet before you judge which society gives them better conditions but in any event in any event let me go to the final point of Colonia of kala means in the first place it's not true that the wealth or the benefits of the West derived from exploiting the colonies the facts are against you the reason why you say that is because it is so hard for people to get out of the notion that life is a zero-sum game they think if one man benefits of another must lose but in a free market both people can benefit now if you take the case of Africa the wheel the wheel had not been invented in parts of Africa by the end of the 19th century the number of people in africa and their average conditions of life in Africa have been enormous have grown enormous Lee as a result of their contacts with the West well I would say you don't know your facts sir they in the case in the case of India which is a very famous case if you look again at the facts all of the studies have shown that it cost Britain more to maintain India these are some famous studies by Jacob Viner which went into the details of it in great detail in colonialism has always cost the mother country more than it ever gotten any direct or indirect economic benefits so far as India was concerned the history of India is divided into three periods the period of British rule in the 19th and early 20th century when there was very real progress in the standard of life of the people of India the period of the 20s and the 30s when there was a great struggle against Britain and for independence when there was essential stagnation in India and there was no growth the period since the creation of independence in 1948 when you have had a highly centralized government when unfortunately it was Harold Laski and not Adam Smith who is the most respected in electoral figure in India when India when the Indian people have have lost not improved when the average amount of food and so on has been going down not up the people in India have been worse off under independent non colonial government than they had been before so colonialism well first of all where is do you have colonialism today you have the classic the classic colonialism behind the eastern cut behind the Iron Curtain you have Russia which is a master country I mean not the union of socialist Soviet republics but Russia which is a master country with a great colony around it within the Soviet Union in Poland and Czechoslovakia and Hungary that's the great example today of your classic kind of colonialism the United States with trivial exceptions has never been a colonial country it did have Philippines it had Philippines for a while Cuba was not a colony of the United States in any event in any event you need a sense of proportion in the period between the between the Revolution in 1776 to 1998 the US had no colonies and yet the u.s. that was a period of the greatest growth and the greatest economic development of the United States your question I see society is more and more tending towards the usurping of my individual rights and freedoms as time goes by what do you see as the ultimate end of this ie either in democracy or socialism and why do you think the individuals within the sia TR letting this happen to them well the last part of your question is the hardest one to answer if we continue along the road we've been going on of usurping more and more power to governmental officials to control our lives I see only one end and that's a loss of anything that has any meaning as democracy a loss of human freedom and a prison state that's the act now why are people letting them to this happy dorm that's a much more difficult that's a much more difficult question to answer and I think it is largely because of ignorance about where they are going a lack of recognition I don't believe they want to go this road but I believe they are unwittingly letting themselves go down there because on each issue that comes up people look at their separate special leaders instead of the broader interest in the in governmental activity everybody wants to cut down government provided that those things he has an interest in are maintained I remember very well the summit conference in Washington on inflation the president Ford had about two or three years ago in which one representative after another got up and said in order to stop inflation we have to cut the government budget the way to cut the government budget is to spend more on my inners that's how each separate group does it so I think we are being driven down this road fundamentally by a defect in our political structure a defect which allows each of these separate elements of government to be voted on simple and never gets the citizen to look at the totality of it and see what the whole thing adds up the solution is for people like you and me to talk to ourselves and to our fellows and to try to persuade our fellow pea men to be of like mine to change the climate of opinion in these respect to try to correct the political structure to impose it though I've been recently working on one particular proposal along those lines which is to have constitutional amendments setting a maximum limit to the amount the government may spend I will go into the details but I think fundamentally we are getting with the public at large is asking and the public is asking for it I believe because they do not understand where it's going to lead them because they are misinformed and they are being led that word by the intellectual community which has gone down a wrong now I don't believe the case is hopeless I believe there are many signs of change there are many more people who recognize the problems with this road now than did 20 or 30 years ago experience is a wonderful teacher so that I think we you and I just have to keep on doing our little things trying to persuade our fellows men to be of like mind thank you let's take the next quiz I think you've done an excellent job tonight of defending capitalism capitalism has treated you well in general it's treated the people in this audience well and as you say people respond to things based on their self-interest so I think they've responded well to you what I'd like to get to now is the questioning the relationship between morality and economic policy which you talked about before in terms of the quotes from Thoreau you said that the worst sort of person is the person who's going to try to be charitable and is going to try to be that well you said that it's unwise for a person to be charitable or to be sincere no what did you say that let me repeat you let me repeat Thoreau's word so a rose words would if I knew for certain that a man was coming to my I think we heard coming in my house with a conscious design of doing me good I should run for my life that's not the same thing as being charitable okay fine I'll accept that distinction take what the road just said and you've echoed and apply it to American business and I think what you're basically saying goes American business a corporation man you are the head of a corporation or you're applying will ania is a head of a corporation right can I ask you the question please sure now it seems to me that the implication is that corporation should not try to do anyone else good because then the people would run away what they should do is pursue their own self-interest that means profit and what I'd like to talk about is the implications of that in terms of three concrete examples um I believe that a couple of years ago when there was a major flood in Pennsylvania you came out as opposed to aid for those disaster victims based on the rationale that they had bought the land at lower prices because the risk was known and they shouldn't be given any aid I'd like to to consider the implications of that second later than what I came out for games I came out against the government providing flood insurance insurance at low cost in advance I did not come out against private individuals giving charity to the feet what about disaster aid by the government I think well is the same thing the nuclear power plants ought to be required to pay for full insurance themselves and that ought to be incorporated in their charges I am not in favor of government subsidization of nuclear power plant insurance ok a second look don't attribute to me your conventional views of what quote a conservative believes because I'm not a conservative I'm a believer in freedom well then I'd like to talk about that using an example freedom in Ohio an old man failed to pay his electric bill you may be familiar with the case and the electric company turned off the electricity and he died the reason they turned it off was because it wouldn't have been profitable for them to keep it on because he didn't pay his bill do you believe that was right I don't know the details of that case at all but I can well Malay but I'll be glad to not know excuse me in many of these cases you hear stories which when you find the details are very different from those are present but let's suppose it were true which is what I was going to go understand you know why do you want to tell me why do you assume I'm always going to give the wrong answer let's assume let's assume the facts and we're truth the result is tragic who is responsible is it really the responsibility should I blame the people let's suppose at the for a moment let's suppose that the electric company we're to follow the practice of never turning off anybody's electricity let's just for a moment take that other extreme then this wouldn't have happened who would pay the cost there's no weather grants witness well for a moment we can come to other alternatives but I just want to show you the logic of the case because I was the only acidity no no it's not an absurdity because I want to show you then what you have to ask about are the costs imposed on different individuals the electric company is meaningless the electric company is a nonhuman institution the electric company that what you must talk are either the stockholders of the electric company the employees of the electric company or the customers of the electric company those are the people involved now if you go to the other extreme and adopt a policy that the electric company will always will never turn anything off then you effectively institute a system under which the only people who will pay for electricity will be those who pay for it voluntarily now the number is even the only two alternatives no but I'm just showing you I want to go you've gone to one extreme I'm going to the other extreme and show you that where the responsibility really lies for the kind of thing you're describing the responsibility really is not on the electric company for turning it off but on those of this man's neighbors and friends and associates who are not charitable enough to enable him as an individual to meet the electric bill you'll rue you're blaming you're blaming the wrong person for what happened okay well I think people understand that example I have just one more this has to do with the the Ford Pinto I'm not sure if you're aware of the recent revelations that have come out about the production of that car Ford produced it knowing full well that in any rear-end collision the gas tank would blow up because they had failed to install a 13 dollar plastic block in front of the gas tank and Ford estimated in an internal memo that that would cost about 200 lives a year and they estimated further that the cost of each life would be two hundred thousand dollars they multiplied and they found that the cost of installing those blocks in each of the cars would be more than the cost of saving those 200 lives and over the past seven years the car has been produced and over a thousand lives have been lost it seems to me that Ford did what would be the right thing according to your policy and yet that seems to me to be very wrong well let me ask you let's suppose it would have cost a billion dollars per person should for to put them in a nonetheless so you're early on Weston you know that you're really only arguing about the print you're not arguing about principle your no no no because you attend not nobody can take the principle nobody can accept the principle that an infinite value should be put on an individual life because in order to get the money involved in order to get the resources involved it's not money in order to get the resort they have to come from someone and you want the policy which is maximize as a situation overall you cannot accept a situation that a million people should starve in order to provide one person with a car that is completely safe that's absolutely right right and there's well you're not arguing anything about principle you're just asking you're just arguing whether Ford used two hundred thousand dollars was the right number or not no I'm not I suppose it was hard-earned million what was it we're 200 million dollars what should Ford have done 200 million dollars for what suppose it would have cost 200 million dollars per life saved should Ford still have spent that 200 million dollars you mean / that's not that's not really the question yes it is a question yeah that's a beautiful question that's the only principle involved I don't know whether Ford did the right came to the right answer or not what's the question of whether these numbers are valid numbers for the relative costs of different things you're not arguing about a principle if you once agree with me yes it have been two hundred million dollars the cost per life saved have been two hundred million dollars you would not argue look let me go back for a moment can I say something in response to that if Ford had not been able to market those cars in the same kind of economic bracket because of the price of installing this one plastic block that would be a different question maybe for it could have considered redesigning the whole car so as to make it cheaper but what we're talking about is balancing advantages and balance organs that's more used to minute your honor I'm a supporter of abortion therefore I don't believe that every single human life is sacred I believe that principles have to be balanced and yet I don't see Ford spending $13 less on each car at the cost of 200 lives a year as being a principled position to take other than your logic that is one fewer life a year so that the $13 per car so that that one life instead of being two hundred times what's two hundred times two hundred thousand and it's a 40 million suppose it had been one life a year so did it cost 40 million would it then have been okay for Ford nothing ever did that one life is going to be cost because of a physical defect in the car this was a clear I know I know I know but this is you're evading the question of principle no I'm not I'm saying that they know before they put the car out that there was a defect you know when you buy a car you know that your chance of being killed in a Pinto is greater than your chance of being killed in a Mack truck no I didn't I didn't know that the game tank would rupture of course it is a question where we one of us separately in this room could at a cost reduce his risk of dying tomorrow you don't have to walk across the street of course the question is is he willing to pay for it and the question here he should be raising if he wants to raise a question of principle we rightfully have raised his whether Ford wasn't required to attach to this car the statement we have made this cart $13 cheaper and therefore it is one whatever the percent is it is one percent more risky for you to buy it but while that then he would be arguing a real question of principle why should they do that or doesn't that interfere with the free enterprise system that you're counting why not the consumer should be free to decide what risky wants to bear if you want to pay $13 extra for that you should be free to do it but if you don't want those oh wait excuse me we have to keep it to the audio over here so then the government does have the right to require information of corporation right no no the government has a right to provide courts of law in which corporations that deliberately concealed material that is relevant can be sued for fraud and made to pay very heavy expenses and that is a desirable part of the market of course what I'm trying to say to you is that these things are really a little bit more subtle and sophisticated than you are at first led to believe there are no you can't get easy answers along this line because your way of putting it really only doesn't really get up the fundamental principles involve the real fundamental principle is that people individually should be free to decide how much they're willing to pay for reducing the chances of their death now people mostly aren't willing to pay very much I personally regard this as very very illogical I see people on all sides of me smoking now there's no doubt nobody denies that that increases their chance of death I'm not saying they shouldn't be free to smoke don't missing them I just think they're fools to do it and I and I know they're fools because I quit on the basis of the evidence 18 years ago but that's the real issue and if you want it to be right forward you ought to be rated on those terms not on the ground that you don't think they use the right numbers now look I don't think we can keep on going very m'f raid we're going to run out of tape and I'm afraid I'm going to run out of voice so I think I'll call again




Comments
  1. “Humane”. No economic system can answer that. For over half a century, my experience tells me that living in a humane way greatly depends on what pure philosophies you’ve encountered along the way with lots of thought. I can see that the most freest macro “system” will allow individuals to make those decisions since only individuals can — not governments who engage in central planning of an economy. The further you deviate from capitalism towards socialism, things become less humane. There’s plenty of 20th century history that fully supports this, as well as policies of China, Cuba, Venezuela, et al.

  2. Could you imagine trying to give this speech at most colleges today. there would be riots and the left would try and destroy Freidman.. Amazing at one time people actually listened and asked questions but then socialism doesn't like you to think

  3. Not sure about the colonialism part. India suffered much more during British rule than it would have otherwise. Britain extracted a lot of economic value from the subcontinent. Sure it must have cost the colonizers a lot, but they made up for it with both wealth and power. Colonialism harming the host country more is such bullshit.

    The rest seems good though.

  4. slavery had little to do with why the west is rich, if it was so important than only the part that had slaves would be rich, but that isn't so, germany for example is very wealthy and russia that effectively had slaves isn't so wealthy but has improved since liberalization of their economy. There is no real correlation to slavery and wealth, in fact it probably negatively correlates.

  5. FYI, the kid debating Friedman at 11:45 is a much younger (and skinnier) Michael Moore. Just wanted to share, for those that weren't aware. With his Fahrenheit 9/11 and other documentaries, American Capitalism has treated him well.

  6. I wonder what Mr. Friedman would have thought of Obama and Trump. I would like nothing more than to hear it.

  7. Just as a prelude I want to state that I agree with the majority of the socio-economic principles held by guys like Shapiro and other capitalists.

    But I was wondering if anyone else might agree that Friedman was obviously evading the ethical matter of the Ford Pinto. Am I wrong?

  8. Friedman just loses the Ford argument. Friedman shouldve just said Ford made a mistake and its not a part of capitalist principle.

  9. Impressive kids. They may be on the wrong side of your preferred flavor of politics but smart kids nevertheless.

  10. While making interesting and valid points, he failed to actually answer their questions. His answers were just questions from a different set of circumstances than the audience members’ questions.

  11. Seems like the availability for discussing the political issues has always been more native to the conservative, rather than the overwhelmingly liberal audience, presented here.

  12. 20:00 Ugh, I would be ashamed to admit that in public. Ironically, he's trying to make points about morality.

  13. 1:00 – This brainwashed Leftist couldn't have been more wrong and had things more backwards from reality.

  14. If someone asked me to describe a left wing person in most stereotypical way, it would be exactly like the guy that made first question

  15. In 2019 we need WAY more this kind of exchange of ideas… today, it seems that we can't talk about anything without tremendous consequences, retaliation, anger, outrage and so on…

  16. Milton Friedman is so nice and kind that he accepted the questions of stupid socialist 20-year-old students even though he is the legendary top economist who got the nobel prize. No economist do the same thing as he did. That is why he is truly a legend

  17. Arrogant brother questioner….looking for attention. This is an example of a simpleton question. About a 11th grade level, but he thinks he is revealing something no on else has thought about. So proud of himself for getting attention.

  18. It kills me that this discussion has lasted for so long. It's clear then, that our education is at fault. Since it brought up every young adult to this exact same ideology then all the way until now. It's insane that college students 30+ years apart are saying and thinking the exact same things.

    We need to do better in education.

  19. Watching these kids try to out debate Milton Friedman is like watching lambs go to the slaughter.

  20. Fast forward 40 yrs and its still the intellectual community convincing the masses to that government is their savior and it should keep spending like money grows on trees.

  21. The examples the last guy brought up about old man's juice bills and stuff were indeed weak and anecdotal, but I wonder what would mr. Friedman say about:
    1) How tobacco manufacturers were collectively undermining the research of tobacco's carcinogenicity through sponsoring studies that deemed it unclear or denounced altogether (possibly, aware of the falsehood of these claims). The battle had lasted for over 40 years before the "cancer scare" was finally recognized. According to the principle of profit-driven economy and least government interference, this campaign was a right thing to do.
    https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3490543/
    2) The deliberate deforestation of tropical areas for palm oil production that drives species, some of them endangered, out of their natural habitats and significantly decreases the planet's CO2 storage capacity.
    https://www.scientificamerican.com/article/harvesting-palm-oil-and-rainforests/
    3) Corporations receiving raw materials from slave labor plants in developing countries of Africa and Asia and concealing their sources. There are approx. 27 000 000 people involved in slave labor today. Just to name a couple instances.
    https://www.theguardian.com/sustainable-business/2016/feb/01/nestle-slavery-thailand-fighting-child-labour-lawsuit-ivory-coast
    https://www.theguardian.com/global-development/2016/jan/19/children-as-young-as-seven-mining-cobalt-for-use-in-smartphones-says-amnesty

  22. Im glad Friedman got a chance to put Micheal Moore in his place before he died!! I doubt he will be putting this clip in any of his films anytime soon!!

  23. China is state capitalist bro. Capitalist saved the Chinese from starvation. Socialism put the Chinese into starvation

  24. Milton's description of Britain's role in India is simply wrong. He has split India's history into 3 periods, which began with the British Raj. The people in the region, now called India were building cities and roads whilst Western Europeans were living in caves. Prior to British rule, the north of present-day India, up to Afghanistan was ruled by the Sikh Empire. The people of these regions enjoyed vast improvements in their quality of life, and enjoyed great advancements in social, political and economic freedoms. The British eroded these exact freedoms.

  25. at least the people listen his arguments.. not a reality in todays universitys meet (sorry, im not a english speaker)

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