Milton Friedman

.. umber of jobs available, or the number of people available for a class of job; both by enforcing a higher wage rate. Of course unions can also be harmful to the workers. This is because anytime one group of workers is benefiting from the increased wages or other union benefits, another group is being hurt by it. For example, if the pilots union decides to raise his ticket prices, he would benefit with the profit, but the consumer is hurt by this transaction.

Even other pilots are hurt by this raising of wages, because when wages are raised, more must be charged for the tickets, and as a result less people will fly. This will mean that fewer pilots are required, and some can be let go. The government sets laws such as minimum wage, child labor laws, and affirmative action to help to protect the worker. Once again these laws definitely do help the worker, however some laws, such as the minimum wage law can give certain groups, especially minorities, an unfair disadvantage. Minimum wage laws stop workers that maybe aren’t worth as much as minimum wage from getting a job where they could work up with on the job training or something. Instead many minority teenagers have great problems finding jobs.

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Some laws, like child labor and workmen’s compensation simply embody practices that had already become commonplace. Other employers especially protect many employees. This is simply competition in the job market. If workers are mistreated or not paid enough, they can always get another job at another company. Finally, there are certain job situations in which the worker is really covered by no one. Workers who have only one possible employer, and workers who have no possible employer.

A good example of a worker with one possible employer would be a professional sports team player. While they have a contract, the only leverage they have is to threaten not to play. This can work to great lengths, or it can work not at all, just depending on the situation. People who have no choice among employers are usually victims of government measures. For example, it’s only beneficial for a welfare recipient to get a job if the wages he earns will make up for the money he will lose. However, it may not be possible for a person of such a disadvantaged background to find an employer to which he is worth that much.

Such people are the victims of bad socioeconomic background and bad schooling, says Friedman. Milton and Rose Friedman have founded the entire movement of School Choice. They believe that public schools are a large part of what is wrong with our society today, and why so many average people are so grossly uneducated. If you have a child, they are herded into the nearest school district, then herded into the nearest overpopulated under-funded public school. This is just another version of the post office, where an establishment has no rival business to live up to, therefore can do whatever it wants and be as sub-par as it wants. And very often parents don’t have any other choice except for very pricey private schools.

Schools that are run independent from local government bureaucracy provide better education at lower cost. School choice would allow more students to attend better schools. It is a potent educational reform that is far more effective than increased spending. The fears of opponents of school choice are factually unfounded. Through allowing more parental choice in education, school choice forces education into a free market environment, thus creating competition, and thus a desire to improve.

If a family is wealthy enough, they can send their children to a private school, however then they are paying twice as much to send their child to private school as well as still paying taxes on public school. What Milton and Rose propose is that any parent who decides to send their child to a private school will receive a scholarship from the government, redeemable for tuition at scholarship-accepting private schools. The scholarship dollar amount is far below that of the average cost per student per year at public schools, but would allow millions of parents who cannot presently afford private tuition to do so. One conflict of the voucher program, however, is the racial implications of it. Some people believe that because the schools can now be chosen, the melting pot environment of public school will no longer exist, instead vouchers will only be a flashback to the vouchers that were used by the white community to avoid integration. However, Friedman assures that this will not be so.

Instead he feels that since children will be grouped into schools based upon common interests, like arts or sciences, whatever the school specializes in, they will look past racial implications and would be a step in the right direction for civil rights. Another question of the school voucher program is whether or not the students would be permitted to use thir vouchers at parochial schools, and whether that would violate the first amendment. Obviously this issue would have to be settled in court, however Bush compred the school voucher system to the GI Bill for kids and no problems were ever brought up with any of the veterans who attended religious colleges. Friedman believes however, that despite the many questions and conflicts the voucher program would make public and private schools a safer place to send your children. By grouping children by schools of interest, you are more likely to have children who want to go to school, and are therefore less likely to cause problems. Milton Friedman is known mostly as the anti-Keynesian. This is mostly in reference to the Phillip’s Curve, or the inflation-unemployment trade-off, which is the Keynesian model that depicts the inverse relationship between inflation and unemployment, namely when inflation goes up unemployment will go down.

This theory helped to add some signification to inflation, recognizing that is had a purpose. However, Milton Friedman came along in the 60’s and 70’s and proved there were many points that just did not fit along this curve, in which both unemployment and inflation were high. These points fell far to the right of the initial curve. This shows higher rates of inflation coexisting everywhere with high rates of unemployment. It seemed to require higher and higher rates of inflation to bring the unemployment down to an acceptable level. Another one of Friedman’s strongest and most well known opinions was on the Federal Reserve and how it is practically useless. Friedman being the big free-market capitalist that he is, thinks that the Federal Reserve acts stupidly, rashly and doesn’t take the time-lag into respect when making their dramatic decisions. Friedman also blames most of the economic instabilities on the federal reserve’s action. Milton Friedman has definitely been one of the most influential economists of the 20th century. His discoveries and theories in monetary policy, school choice liberalism and inflation relations impact economic history in a way only a few people can do.

He and his wife Rose are now running the Foundation for school-choice and have just published Two Lucky People: Memoirs. Bibliography Bibliography ? Friedman, Milton. Bright Promises, Dismal Performance: An Economist’s Protest. New York: HBJ, 1983. ? Friedman, Milton and Rose.

Free to Choose: A Personal Statement. New York: HBJ, 1980. ? Hodges, Michael. Milton Friedman- A Tribute by MWHodges. May 2001. September 2001.

? Walters, Alan. A Dictionary of Economics, The New Palgrave. Vol.2, 1987. Pp.422-427. Economics Essays.