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Milton Friedman before and after the abduction


Milton Friedman did not always disparage creative fiscal approaches

In a recent blog by Derryl Hermanutz in Econintersect, written as part 6 of the series Barter Thinking In A Money Economy [1], the author discusses the apparently total transformation in the thinking of the U.S. economist Milton Friedman after 1948.

Many readers might not be aware that, in the early stage of his career, Milton Friedman advocated a universal basic income scheme. The following extract is from that article by Hermanutz:

Milton Friedman, before abduction

In his 1948 paper, A Monetary and Fiscal Framework for Economic Stability, Milton Friedman describes how a money-issuing government can use fiscal spending to add money where it’s needed and use fiscal taxation to remove money where it’s causing price inflation. Friedman went so far as to advocate using government-issued money to fund a negative income tax, which would function as a Universal Basic Income.

Friedman eloquently explains the monetary and fiscal means by which governments could operate their national money system as an economy- serving public utility; rather than private bankers and plutocrats indebting the economy to make it an interest-paying rent-cow. Friedman’s 15 page paper is the most succinctly expressed rational program for financial-come-economic salvation that I have had the pleasure to encounter.

Milton Friedman, post abduction

Unfortunately, somewhere after the 1947 “Roswell incident”, Friedman seems to have been abducted by space aliens who reprogrammed his brain. It was the 1970s version of Friedman whose “Chicago Boys” led the neoliberal privatization revolution in Latin America, replacing social democrats with murderous tyrants, and crushing the people under IMF structural adjustment austerity while robbing them of ownership of their public and private property. Ask Yanis Varoufakis if anything has changed between 1970s Latin America and 2016 Greece.

  1. D. Hermanutz; Econintersect, 14 Jan 2016 Barter Thinking In A Money Economy, Pt 6

  2. M. Friedman; A Monetary and Fiscal Framework for Economic Stability (1948)

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