Milton Friedman - Regulation In A Free Society

dr. Friedman is our guest and we hope you'll join us you're not going to condemn regulations regarding a mission and I certainly am of course I'm going to condemn them why not because if we don't have them you're going they're not going to be able to breathe and you and I will not be in our senior years able to sit around and argue with each other well those are assertions there are statements that are made but they are far from being correct the fact is that the pollution was going down long before we had any emission requirements and it would go down without them there is a case for doing something about pollution but the way we've been going about it is the wrong way is there a case for the government to do something yes there is a case for the government to do something about it because there's always a case for the government to some extent when what two people do affects a third party there's no case for the government whatsoever in mandating airbags because airbags protect the people inside the car that's my business if I want to protect myself I should do it at my expense but there isn't but there is a case for the government protecting third parties protecting people who have not voluntarily agreed to enter so there's more of a case for example for emission control and there is for air bags but the question is what's the best way to do it and the best way to do it is not to have bureaucrats in Washington write rules and regulations saying that a car has to carry this that or the other the best way to do it is to impose a tax on the amount of pollutant pollutants emitted by a car and make it in the self-interest of of the car manufacturers and of the consumers to keep down the amount of pollution in that way but how would you put a monetary value on particulate matter which is admitted from the end of an exhaust to do it now what do you mean how do you do it you now require people to spend something like five hundred dollars per car for the purpose supposedly of reducing predicted particulate matter which means for the purpose of giving them an incentive to disconnect the equipment that supposed to reduce pollution you mean the owner people are going out of their way same with the buzzer I assume that you have you ever met Ralph Nader of course I've debated Ralph Nader many times and I assume you feel that what is it that troubles you about him I think he's wrong I think I think I don't have any doubt about his sincerity but I think sincerity is a much overrated virtue I think what troubles me about him is that he wants to run my life for me instead of letting me run my life let's just take a couple of things if it weren't for Ralph Nader we would still have those ornaments on the hoods of cars which impale babies and women and children crossing streets we would still have an auto industry which is totally focused on cosmetics at the expense of sound automotive engineering we would still have an auto worker we'd still have an automobile business and its ancillary supplier of tires with the difficulties that would be sent out to the public without without regard to any problem at all of being asked to account for them you know the problem with claims like that is that they don't stand up to the facts now take the most famous case you know Ralph Nader got his start by a book called unsafe at any speed it referred to the Corvair do you know the ten years after he launched his attack and persuaded the public at large that the Corvair was an unsafe car the federal government finally got around to investigating the safety of the Corvair and it's official report concluded that the Corvair was a perfectly safe car just as safe as the alternatives available and that Ralph Nader's claims were completely unjustified why'd oh that similarly with all those extravagant claims which I know you're not making on your own behalf you're the devil's advocate and a very good devil to thank you I think and a very good advocate so but the troubles I just want to make this point professor Friedman you are using the United States government whose post office is often referred to by you in columns and speeches and in writings as an example of what happens when you give but ought to be the private enterprises business to the United States government now you turn around and use this United States burek bureaucracy to support your defense of Ralph Nader I mean why should I have any more confidence in the in the government's review of the Corvair then in the government's operation of the postal you shouldn't I have no more confidence well you certainly cited it to do not just seek to part and I just have as much confidence in it as I do in Ralph Nader's evaluation so we're even Z's there that's right so then either there is no evidence no one neither Ralph Nader nor anyone else has ever presented any evidence that justifies his charges no one has presented evidence to justify the kind of charges you're making and those charges are simply untrue it is not a fact that the world would have come to an end but for Ralph Nader but more important take one of those charges if the cars would be devoted to cosmetics if people want to spend their money on cosmetics why shouldn't I you mean to say you should be prohibited by the government from doing whatever you do to have a to give a nice cosmetic image to your viewers now I guess I'm thinking that if we just leave it to Detroit if we had just left it to Detroit in your own laissez faire and you're wearing your Adam Smith tie today always wear it on David I know let me tell you what I think let's just you tell me what's wrong with this chair if we just you know it's telling out Ralph need to go somewhere else and complain Jen and let's let Detroit in the free enterprise system handle this here's what we would not have we would not have collapsible steering wheels we would not have padded dashboards we would not have spring-loaded ornaments that Bend back so that you minimize injury in the case of hitting a pedestrian you would you would not have first of all I have no reason to suppose that's true long before Ralph Nader came on the picture the automobile industry had made cars increasingly safe brakes had become better the protection and the bumpers had become better the doors had become better they when it turned out they were defective the automobile industry introduced him almost all of the developments in automobile in that direction the had arrived and were on the way long before Ralph Nader came along but if you didn't have Ralph Nader if you hadn't had that movement you also would have cars considerably cheaper you'd have them available to a much wider range of people they would be using less gas than they do now not more gas than they do now you after all the thing that amazes me about people who make statements like this is they're neglected history we this country went for close to 200 years without a Ralph Nader and without these regulations and that was a period in which this country had its greatest growth in which people stream to it from all over the Elden were able to make a better life for themselves and their children if you take the automobile industry in particular since Henry Ford really revolutionized it it transformed the nature of life in this country the automobiles improved tremendously they came down and cost relative to other goods the effect of the kind of regulations you now have have has been to make automobiles not more safe but less safe why because by making them more expensive they make it pay to keep an old car on the road longer the average age of cars on the road has gone up and old cars are less statement a new car

  1. Carbon taxes are gross. You can't assign a value to carbon emissions because the economic cost is far from measurable. There is no causal relation that can assign a value to carbon emissions because the attributions of climate change are not clear.

    This can be measured for other chemicals however.

  2. What a clown. So he hails the years when children were made to work in factories as something great bc they move industry ahead.

    Everyone in the comments below who agrees with this jokester should drive around without their seatbelts on, passengers included.

  3. I don't know. I'm thinking Melton's never going to lose an argument! Wouldn't it be great if everybody was that smart!

  4. This makes me think of the insanity rooms in biohazard the Game. where confused individuals chase after your with syringes.

  5. What was missed was that if no regulation, individual citizens would be at risk while industry adapted. smh. sad

  6. Trump is the most anti libertarian president ever, yet, his fanbase is libertarian. Either they are all super rich or super stupid.

  7. If you choose not to have an airbag in your car, get in an accident, then run up high medical bills, it is the rest of us whose insurance premiums will rise, so WRONG, Mr. Friedman, not having airbags also has an effect on the rest of us.

  8. Nice try, Milton, but you're full of shit. He obviously hasn't read Adam Smith's, "The Wealth of Nations."

  9. Supposed libertarian Trump fans are losing it when Gary Johnson advocates a carbon tax, while Milton Friedman supports a similar concept. Hey, Trump fans how about you go through all the non-libertarian policies Donald Trump is advocating before you start attacking Johnson for this grey area libertarian-ish policy.

  10. Jeepers, the first time in my life, I can actually say

    Mr Friedman, you are some what wrong

    just like 1 minute in, he talks about taxing based on car emissions, however by doing this, it makes it very difficult to sell your car to raise enough money to but a newer green/ more efficient car. As a result of your car, in which you are trying to sell, is now worth less as a result of the higher level of tax imposed.

  11. The problem without safety regulation is that the rest of society usually ends up paying the the bill on the medical bill taking care of the person who got hurt. This moral obligation we cannot get around. Milton is unrealistic on this one.

  12. Hats off to Friedman yet again, he made it very clear in the last 30 seconds and smashed the debate. 

  13. I think certain businesses would start cutting costs to the extent that dodgy products would become much more common on the market, yes. I also think the sky is blue and that homo sapiens generally walk on two legs.

  14. So you think without the FDA, chocolate companies would start poisoning their customers because what? It's good for business? Ok.

  15. It doesn't even take manipulation, just a lack of knowledge on the part of the consumer. Do we really want to live in a country where we have to research every chocolate bar we buy to check the manufacturer doesn't sell poison? Commerce would grind to a halt. The whole conversation is retarded, these 'libertarians' would be out on the streets protesting within a week if their asinine ideas were ever implemented.

  16. Motorcycles are unsafe. Everyone knows they are and people buy them anyway. People know cigarettes are unsafe, but they smoke anyway. People will and should do what they want to do. Like you say, no government control needed.

  17. Walter Block showed that there are legal precedents from the late 1800s that prevent 3rd party lawsuits against large polluters. The reasoning is, these polluters serve a greater service to the community than the inconveniences it creates. Which may have been true in some cases. One case was a woman that lived near a power plant sued because the clothes that she hung out on the line would get soot on them. But these precedents are applied to today's pollution problems. Nice eh?

  18. Agreed, as long as there is a demand for safety by the consumers, car manufacturers will try to make them as safe as possible, for the lowest price possible.

  19. @metzger90 My statement was simply pointing out that the Austrian school is better than the Chicago school… and Keynes is essentially a negative. I agree though, Mises, Hayek, Bastiat, and many other Austrians are great economists.

  20. If a car is unsafe, publicize it! The public won't buy it, & the manufacturer is motivated to make a safer one. No govt control needed.

  21. @ffrank345 I agree. The first thing I thought of when I heard him give his model for environmental regulation was cap and trade.

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