The Lowdown: This Summary of Capitalism and Freedom is based on the very influential book from Milton Friedman, which delves into why radical changes needed to be made to the economic philosophies which were prevalent at the time.
Back in the 1960’s, there were two very dominant economic structures. These included the Capitalistic approach, as well as a Socialist method. Friedman was a staunch advocate for capitalism, and even went so far as to show why the great depression which happened in the late 1920’s in the United States was not caused by a bad system, but rather, a miscalculation concerning the methods of calculating inflation by the Federal Reserve.
At the time of its publication, it was perceived as a very radical approach to the economic system at the time. Friedman argued that capitalism, as it was, was too conservative and needed some changes to help the system thrive.
- Audible Audiobook
- Milton Friedman (Author) – Michael Edwards (Narrator)
- English (Publication Language)
- 06/06/2017 (Publication Date) – Blackstone Audio, Inc. (Publisher)
Three of the Main Influential Lessons you’ll learn from Capitalism and Freedom include:
- Economic Freedom and Political Freedom are Related
- Social Welfare measures fail to do what they Intend
- Progress via People, not Governments
Lesson One: Economic Freedom and Political Freedom are related
Friedman starts off his book by arguing this succinct point – there can be no political freedom without economic freedom. He states how Economic Freedom is a necessary component for a country to both grow and innovate. If the government is controlling what is being made, and controls the message of what is being said, then you will have a country full of citizens who cannot make decisions on their own.
If this is the case, then the only progress which is realized are the ideas of those leading the government, and more times than not, they are only concerned with their own power.
Not only this, but this mentality hurts any minority group, as it becomes a culture where it is “us vs. them”, which means unless you look and act like those in charge, you will never have a chance to better yourself.
Lesson Two: Social Welfare measures fail to do what they Intend
During WWII, FDR implemented in a system called Welfare into the United States. This is a program where the Government basically acts like a savings account for each citizen, and once they turn 65, then they can start receiving payments from this savings account on a monthly basis.
Although this was a well-intended act, as the US was just coming out of their Great Depression, it has had a long lasting drain on the budget of the US. This system gives money to all people, no matter how much they made during their lifetime, even those who are Millionaires. It is a system which was to help those who are poor, so they know they have money still coming to them when they retire.
However, the amount given is all based upon how much money you make. The less you make during your working years, the less you will receive. The program continues to widen the class gap of rich and poor. Rather than letting those who are poor take the money when they could use the money, it is held from them and only given to them after a certain age.
This is just one example of a program which was meant to help, but in practice, hurts the country as a whole, and Friedman argues it should be a program which is abolished.
Lesson Three: Progress via People, not Governments
A society based upon Socialism is one which stifles competition and innovation. Not only is this true, but even with a Capitalistic society, if there are restrictions on trading, or there are monopolies in place among certain sectors of business, then this leads to one group of people having more power than they should.
Governments should allow their citizens to live in a culture where they can fail or thrive within the context of their own skill and ability. This doesn’t mean there should be not be any regulations in place to help those who need help, but these should be held to a minimum. Each society would be better, long-term, if they allowed their citizens the freedom needed to both make mistakes, to learn from those, and to work together towards a positive solution.
People do not need the protection of the Government – they mostly need protection *from* the Government.
My Personal Takeaway
Even though this book was written back in the 1960’s, most of these ideas are ones which could be implemented in today. We as a society have evolved over time, and we are richer now than we ever have been. Even with this being the case, we still struggle on finding the right solution of balance between the involvement of a Government within each society. Often times, rules and laws are put into place which affect everyone, even though it might only be a small fraction of the citizens who need the protection.
Put into Action
Take the lessons from this book, and see how they stack up against the larger countries within the world. There are a variety of different economic systems to learn from, and perhaps, more than anything, this though provoking book should help clarify what your own beliefs are concerning Personal Freedoms and the influence any Government should have on Personal Freedoms.
You should consider buying this book if…
You want to take a deep dive into Economic and Social Issues, and how they are (and are not) persuaded by the laws and regulations each Government puts into place.
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