June 10, 2003

Friedman flips! Money -- money -- quote:

"The use of quantity of money as a target has not been a success."

Of course, there is more to the old man than merely money, and Uncle Milton is always good for a strong shot of crystal clear commentary:

"The second President Bush appears to have inherited the free-spending tendencies of the first," he says dismissively. What, then, of the tax cuts that the president recently signed into law? "His insistence on tax cuts is good," he concedes. "That is the only real way of bringing pressure on Congress to hold down spending. In my view, the size of government is determined much more by how much they can raise in taxes than by any ideological theory." The entrees arrive very, very hot.

"To go back to your original question, the tide of public opinion has continued to go against government. People are as suspicious as ever of government - big or small. Unfortunately, the slowness with which public opinion affects policy has not changed."

His favourite example of the mismatch between public opinion and public policy is school vouchers. Such a scheme, he says, would unleash market forces in the education sector by giving parents the right to choose which school their child attends. Funding would be granted in the first instance to the child, not the school. Schools would then have to compete for business by raising standards or pleasing parents in other ways.

"There is no doubt about public opinion," he says, tucking in to his eggplant. "Everyone knows that the public school system is lousy. The solutions proposed are all ineffective with one exception: a greater degree of parental choice - more competition. The majority of the American public is in favour of child-centred financing. But the teachers unions exercise such strong political control that it is very, very difficult to make any progress."

A great and important man. What is that line about a man who increases the will to live?

Posted by Greg Ransom