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International Socialism, Winter 1963/4


Chris Gray

In Defence of Shareholders


From International Socialism, No.15, Winter 1963/4, p.40.
Transcribed & marked up by Einde O’Callaghan for ETOL.


Capitalism and Freedom
Milton Friedman
University of Chicago Press; $3.95.

For Mr. Friedman capitalism and freedom are practically synonoymous. For him the ‘golden age’ of ancient Greece and the re-emergence of ‘free society’ in the nineteenth century are indissolubly connected with the growth of a free market and ‘capitalist’ institutions. The individual, or possibly the family, is the ultimate value. There is a great deal of ‘freedom to’ with Mr. Friedman and very little of ‘freedom from’, and the less government initiative the better. The book is interesting as a critique of American welfare statism but apart from this either uninspiring or else reactionary in the most flagrant manner.

Thus for example the author piously asserts his opposition to racial discrimination while condemning government intervention to promote integration on the lines Kennedy was attempting. Free trade is commended as a means of increasing the political economic power of the United States. Shareholders are defended at the expense of the controlling powers of corporate management. A number of welfare measures ranging from Keynesian government expenditure to state-controlled old age pensions come in for criticism.

And to crown all Mr Friedman outlines something which looks like a genuinely new method of generating surplus value: the advancement of capital to finance education, a certain sum being paid back for this ‘service’ by those who pass their examinations. (Mr Friedman is quite willing, incidentally, that the state should enter this field, but he is dead agin government financing and administration of education). As Mr Friedman engagingly explains:

‘There seems to be no logical obstacle to private contracts of this kind, even though they are economically equivalent to the purchase of a share in an individual’s earning capacity and thus to partial slavery.’

The book boasts no index, but perhaps that is just as well.

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