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Presidential Medal of Freedom Recipient Milton Freidman
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Presidential Medal of Freedom Recipient Milton Freidman
For Immediate Release
Office of the Press Secretary
May 9, 2002
Remarks by the President in Tribute to Milton Friedman
Eisenhower Executive Office Building
Room 450
11:37 A.M. EDT
THE PRESIDENT: Well, thank you all very much. It's an honor for me to be here to pay tribute to a hero of freedom, Milton Freidman. He has used a brilliant mind to advance a moral vision: the vision of a society where men and women are free, free to choose, but where government is not as free to override their decisions.
That vision has changed America and it is changing the world. All of us owe a tremendous debt to this man's towering intellect and his devotion to liberty. So it's my honor to welcome you all to the White House. Thank you for coming, I'm looking forward to having lunch.
I appreciate Larry Lindsey, and I want to thank him for his leadership and his friendship. I, of course, want to welcome Rose Friedman, as well. I'm so honored that the Secretary of Defense, Don Rumsfeld, has joined us, as well as the Deputy Secretary of Defense, Paul Wolfowitz.
I want to thank the Chairman for being here. Chairman Greenspan is a steady influence on our country; and I appreciate your leadership.
I want to welcome Dr. Gary Becker, Professor at the University of Chicago, who mentored Milton Friedman. (Laughter.) A Nobel Prize winner. And I want to thank Guity for coming, as well. Welcome. And I appreciate Ed Meese being here, as well. It's great to see you, General.
Milton Friedman has shown us that when government attempts to substitute its own judgments for the judgments of free people, the results are usually disastrous. In contrast to the free market's invisible hand, which improves the lives of people, the government's invisible foot tramples on people's hopes and destroys their dreams.
He has never claimed that free markets are perfect. Yet he has demonstrated that even an imperfect market produces better results than arrogant experts and grasping bureaucrats. But Milton Friedman does not object to government controls solely because they are ineffective. His deeper objectives flow from a moral framework. He has taught us that a free market system's main justification is its moral strength. Human freedom serves the cause of human dignity. Freedom rewards creativity and work, and you cannot reduce freedom in our economy without reducing freedom in our lives.
As Milton Friedman has written, "I know of no society that has been marked by a large measure of political freedom, and that has not also used something comparable to a free market to organize the bulk of economic activity." This viewpoint was once controversial, as was Milton Friedman, himself.
When he began his work, the conventional wisdom held that capitalism's days were numbered. Free market systems were thought to be unsuited to modern problems. Today we recognize that free markets are the great engines of economic development. They are the source of wealth, and the hope of a world weary of poverty and weary of oppression.
We have seen Milton Friedman's ideas at work in Chile, where a group of economists called the "Chicago Boys" brought inflation under control and laid the groundwork for economic success. We have seen them at work in Russia, where the government recently adopted a 13 percent flat tax with impressive results. We have seen them at work in Sweden, which has adopted personal retirement accounts. We have seen them even at work in China, where the government conceded long ago that Marxism was, in their words, "no longer suited" to China's problems.
These are extraordinary developments. They demonstrate that the rest of the world is finally catching up with Milton Friedman. (Laughter and applause.)
Yet Milton Friedman has done more than defend freedom as an abstract ideal. He has creatively applied the power of freedom to the problems of our own country, and in the process he has become an influential social reformer.
Milton has shown us how freedom can enhance our national security. He is the intellectual godfather of our all-volunteer army. He argued that America could rely on the dedication of soldiers who serve in armed forces of their own free will -- and he was right. We have recently seen the quality and idealism and skill of the all-volunteer army. Those who serve our country by choice are serving it with honor.
Milton Friedman has also shown us how freedom can foster educational reform. For many years, he has been a tireless advocate of school choice as a way of empowering parents and improving the performance of our schools. Educational reform advances when parents have the information and the authority to push for reform. And there is no greater authority than a good alternative. Poor children in America need better options when they're trapped in schools that will not teach and will not change. (Applause.)
In all of these issues and debates, Milton Friedman has argued with consistency and courage, and trademark bluntness. His ideas have influence around the world. And by his strength of conviction, he has served his country with distinction. And it has been recognized as such -- after all, he received the 1976 Nobel Prize for Economics, and in 1988 he was awarded the Presidential Medal of Freedom .
In 1938, Milton Friedman married Rose Director, an outstanding economist in her own right -- and the only person known to have ever won an argument with Milton. (Laughter.) Half a century later, Milton and Rose Friedman published a joint memoir called, "Two Lucky People." There's no doubt that Milton and Rose Friedman have been lucky. But not as lucky as America. We're lucky that their parents chose to immigrate from Europe. We're lucky they gave them the love and encouragement they needed to be bold and to succeed.
We're lucky that Milton Friedman flunked some of his qualifying exams to become an actuary -- (laughter) -- and became an economist, instead. (Laughter and applause). We're thankful for those tough exams -- (laughter) -- but not nearly as thankful as we are for the lives and talents and intellect of Milton and Rose Friedman.
May God bless them both, and welcome. (Applause.)
END 11:47 A.M. EDT
Milton Friedman – Autobiography
I was born July 31, 1912, in Brooklyn, N.Y., the fourth and last child and first son of Sarah Ethel (Landau) and Jeno Saul Friedman. My parents were born in Carpatho-Ruthenia (then a province of Austria-Hungary; later, part of inter-war Czechoslovakia, and, currently, of the Soviet Union). They emigrated to the U.S. in their teens, meeting in New York. When I was a year old, my parents moved to Rahway, N.J., a small town about 20 miles from New York City. There, my mother ran a small retail "dry goods" store, while my father engaged in a succession of mostly unsuccessful "jobbing" ventures. The family income was small and highly uncertain; financial crisis was a constant companion. Yet there was always enough to eat, and the family atmosphere was warm and supportive.
Along with my sisters, I attended public elementary and secondary schools, graduating from Rahway High School in 1928, just before my 16th birthday. My father died during my senior year in high school, leaving my mother plus two older sisters to support the family. Nonetheless, it was taken for granted that I would attend college, though, also, that I would have to finance myself.
I was awarded a competitive scholarship to Rutgers University (then a relatively small and predominantly private university receiving limited financial assistance from the State of New Jersey, mostly in the form of such scholarship awards). I was graduated from Rutgers in 1932, financing the rest of my college expenses by the usual mixture of waiting on tables, clerking in a retail store, occasional entrepreneurial ventures, and summer earnings. Initially, I specialized in mathematics, intending to become an actuary, and went so far as to take actuarial examinations, passing several but also failing several. Shortly, however, I became interested in economics, and eventually ended with the equivalent of a major in both fields.
In economics, I had the good fortune to be exposed to two remarkable men: Arthur F. Burns, then teaching at Rutgers while completing his doctoral dissertation for Columbia ; and Homer Jones, teaching between spells of graduate work at the University of Chicago. Arthur Burns shaped my understanding of economic research, introduced me to the highest scientific standards, and became a guiding influence on my subsequent career. Homer Jones introduced me to rigorous economic theory, made economics exciting and relevant, and encouraged me to go on to graduate work. On his recommendation, the Chicago Economics Department offered me a tuition scholarship. As it happened, I was also offered a scholarship by Brown University in Applied Mathematics, but, by that time, I had definitely transferred my primary allegiance to economics. Arthur Burns and Homer Jones remain today among my closest and most valued friends.
Though 1932-33, my first year at Chicago, was, financially, my most difficult year; intellectually, it opened new worlds. Jacob Viner, Frank Knight, Henry Schultz, Lloyd Mints, Henry Simons and, equally important, a brilliant group of graduate students from all over the world exposed me to a cosmopolitan and vibrant intellectual atmosphere of a kind that I had never dreamed existed. I have never recovered.
Personally, the most important event of that year was meeting a shy, withdrawn, lovely, and extremely bright fellow economics student, Rose Director. We were married six years later, when our depression fears of where our livelihood would come from had been dissipated, and, in the words of the fairy tale, have lived happily ever after. Rose has been an active partner in all my professional work since that time.
Thanks to Henry Schultz's friendship with Harold Hotelling, I was offered an attractive fellowship at Columbia for the next year. The year at Columbia widened my horizons still further. Harold Hotelling did for mathematical statistics what Jacob Viner had done for economic theory: revealed it to be an integrated logical whole, not a set of cook-book recipes. He also introduced me to rigorous mathematical economics. Wesley C. Mitchell, John M. Clark and others exposed me to an institutional and empirical approach and a view of economic theory that differed sharply from the Chicago view. Here, too, an exceptional group of fellow students were the most effective teachers.
After the year at Columbia, I returned to Chicago, spending a year as research assistant to Henry Schultz who was then completing his classic, The Theory and Measurement of Demand . Equally important, I formed a lifelong friendship with two fellow students, George J. Stigler and W. Allen Wallis.
Allen went first to New Deal Washington. Largely through his efforts, I followed in the summer of 1935, working at the National Resources Committee on the design of a large consumer budget study then under way. This was one of the two principal components of my later Theory of the Consumption Function.
The other came from my next job - at the National Bureau of Economic Research, where I went in the fall of 1937 to assist Simon Kuznets in his studies of professional income. The end result was our jointly published Incomes from Independent Professional Practice , which also served as my doctoral dissertation at Columbia. That book was finished by 1940, but its publication was delayed until after the war because of controversy among some Bureau directors about our conclusion that the medical profession's monopoly powers had raised substantially the incomes of physicians relative to that of dentists. More important, scientifically, that book introduced the concepts of permanent and transitory income.
The catalyst in combining my earlier consumption work with the income analysis in professional incomes into the permanent income hypothesis was a series of fireside conversations at our summer cottage in New Hampshire with my wife and two of our friends, Dorothy S. Brady and Margaret Reid, all of whom were at the time working on consumption.
I spent 1941 to 1943 at the U.S. Treasury Department, working on wartime tax policy, and 1943-45 at Columbia University in a group headed by Harold Hotelling and W. Allen Wallis, working as a mathematical statistician on problems of weapon design, military tactics, and metallurgical experiments. My capacity as a mathematical statistician undoubtedly reached its zenith on V. E. Day, 1945.
In 1945, I joined George Stigler at the University of Minnesota, from which he had been on leave. After one year there, I accepted an offer from the University of Chicago to teach economic theory, a position opened up by Jacob Viner's departure for Princeton. Chicago has been my intellectual home ever since. At about the same time, Arthur Burns, then director of research at the National Bureau, persuaded me to rejoin the Bureau's staff and take responsibility for their study of the role of money in the business cycle.
The combination of Chicago and the Bureau has been highly productive. At Chicago, I established a "Workshop in Money and Banking". which has enabled our monetary studies to be a cumulative body of work to which many have contributed, rather than a one-man project. I have been fortunate in its participants, who include, I am proud to say, a large fraction of all the leading contributors to the revival in monetary studies that has been such a striking development in our science in the past two decades. At the Bureau, I was supported by Anna J. Schwartz, who brought an economic historian's skill, and an incredible capacity for painstaking attention to detail, to supplement my theoretical propensities. Our work on monetary history and statistics has been enriched and supplemented by both the empirical studies and the theoretical developments that have grown out of the Chicago Workshop.
In the fall of 1950, I spent a quarter in Paris as a consultant to the U.S. governmental agency administering the Marshall Plan. My major assignment was to study the Schuman Plan, the precursor of the common market. This was the origin of my interest in floating exchange rates, since I concluded that a common market would inevitably founder without floating exchange rates. My essay, The Case for Flexible Exchange Rates , was one product.
During the academic year 1953-54, I was a Fulbright Visiting Professor at Gonville & Caius College, Cambridge University. Because my liberal policy views were "extreme" by any Cambridge standards, I was acceptable to, and able greatly to profit from, both groups into which Cambridge economics was tragically and very deeply divided: D.H. Robertson and the "anti-Keynesians"; Joan Robinson, Richard Kahn and the Keynesian majority.
Beginning in the early 1960s, I was increasingly drawn into the public arena, serving in 1964 as an economic adviser to Senator Goldwater in his unsuccessful quest for the presidency, and, in 1968, as one of a committee of economic advisers during Richard Nixon's successful quest. In 1966, I began to write a triweekly column on current affairs for Newsweek magazine, alternating with Paul Samuelson and Henry Wallich. However, these public activities have remained a minor avocation - I have consistently refused offers of full-time positions in Washington. My primary interest continues to be my scientific work.
In 1977, I retire from active teaching at the University of Chicago, though retaining a link with the Department and its research activities. Thereafter, I shall continue to spend spring and summer months at our second home in Vermont, where I have ready access to the library at Dartmouth College - and autumn and winter months as a Senior Research Fellow at the Hoover lnstitution of Stanford University.
Milton Friedman, recipient of the 1976 Nobel Memorial Prize for economic science, has been a senior research fellow at the Hoover Institution since 1977. He is also the Paul Snowden Russell Distinguished Service Professor Emeritus of Economics at the University of Chicago, where he taught from 1946 to 1976, and was a member of the research staff of the National Bureau of Economic Research from 1937 to 1981.
Friedman was awarded the Presidential Medal of Freedom in 1988 and received the National Medal of Science the same year.
He is widely regarded as the leader of the Chicago School of monetary economics, which stresses the importance of the quantity of money as an instrument of government policy and as a determinant of business cycles and inflation.
In addition to his scientific work, Friedman has also written extensively on public policy, always with a primary emphasis on the preservation and extension of individual freedom. His most important books in this field are (with Rose D. Friedman) Capitalism and Freedom (University of Chicago Press, 1962); Bright Promises, Dismal Performance (Thomas Horton and Daughters, 1983), which consists mostly of reprints of columns he wrote for Newsweek from 1966 to 1983; (with Rose D. Friedman) Free to Choose (Harcourt Brace Jovanovich, 1980), which complements a ten-part television series of the same name shown over the Public Broadcasting Service (PBS) network in early 1980; and (with Rose D. Friedman) Tyranny of the Status Quo (Harcourt Brace Jovanovich, 1984), which complements a three-part television series of the same name, shown over PBS in early 1984.
He was a member of the President's Commission on an All-Volunteer Armed Force and the President's Commission on White House Fellows. He was a member of President Ronald Reagan's Economic Policy Advisory Board (a group of experts from outside the government named in 1981 by President Reagan).
He has also been active in public affairs, serving as an informal economic adviser to Senator Barry Goldwater in his unsuccessful campaign for the presidency in 1964, to Richard Nixon in his successful 1968 campaign, to President Nixon subsequently, and to Ronald Reagan in his 1980 campaign.
He has published many books and articles, most notably A Theory of the Consumption Function , The Optimum Quantity of Money and Other Essays , and (with A. J. Schwartz) A Monetary History of the United States , Monetary Statistics of the United States , and Monetary Trends in the United States and the United Kingdom .
He is a past president of the American Economic Association, the Western Economic Association, and the Mont Pelerin Society and is a member of the American Philosophical Society and the National Academy of Sciences.
He also has been awarded honorary degrees by universities in the United States, Japan, Israel, and Guatemala, as well as the Grand Cordon of the First Class Order of the Sacred Treasure by the Japanese government in 1986.
Friedman received a B.A. in 1932 from Rutgers University, an M.A. in 1933 from the University of Chicago, and a Ph.D. in 1946 from Columbia University.
Two Lucky People , his and Rose D. Friedman's memoirs, was published in 1998 by the University of Chicago Press.
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Medal History
