Agnostics From The United States

"You can only aim at equality by giving some people the right to take things from others. And what ultimately happens when you aim for equality is that A and B decide what C should do for D, except that they take a bit of commission off on the way.”"

"The unions might be good for the people who are in the unions but it doesn't do a thing for the people who are unemployed. Because the union keeps down the number of jobs, it doesn't do a thing for them."

"[A] society which is socialist cannot also be democratic, in the sense of guaranteeing individual freedom."

"In fact, the only person to rival Friedman for policy influence in the twentieth century is John Maynard Keynes, who had a strikingly different view of the role of government. Keynes was influential because he advocated more government intervention into what he perceived as poorly functioning private economies caught up in the Great Depression. In contrast to Keynes, Friedman put the main blame for the Depression on government failures, especially of monetary policy. Hence, the Depression did not make Friedman a fan of big government. He also found in the Federal Reserve’s failure to prevent deflation an argument in favor of monetary rules. As the world evolved— with low inflation becoming the major mission of central banks and free markets and secure property rights becoming the main policies to promote economic growth—Friedman surely won the intellectual battle."

"Keep your eye on one thing and one thing only: how much government is spending, because that is the true tax. Every budget is balanced. There is no such thing as an unbalanced federal budget. You're paying for it. If you're not paying for it in the form of explicit taxes, you're paying for it indirectly in the form of inflation or in the form of borrowing. The thing that you keep your eye on is what government spends. And the real problem is to hold down government spending as a fraction of our income. And if you do that, you can stop worrying about the deficit."

"I agree with specific planks in the Friedmans' program, but I remain disappointed at the lack of guiding principles, the casual recommendation of sweeping changes without consideration of their systematic effects, and the one-sided selection of evidence and problems."

"There's a sense in which all taxes are antagonistic to free enterprise … and yet we need taxes. We have to recognize that we must not hope for a Utopia that is unattainable. I would like to see a great deal less government activity than we have now, but I do not believe that we can have a situation in which we don't need government at all. We do need to provide for certain essential government functions — the national defense function, the police function, preserving law and order, maintaining a judiciary. So the question is, which are the least bad taxes? In my opinion the least bad tax is the property tax on the unimproved value of land, the Henry George argument of many, many years ago."

"Let me take the example which is today the greatest sacred cow of them all—Social Security. Was there an overwhelming demand for Social Security in the 1930s when the law was adopted? Far from it. There was no public demand for it, it had to be sold. How was it sold? By the slickest devices of Madison Avenue, by imaginative packaging and deceptive labeling. Social Security was sold as an insurance scheme. It is not an insurance scheme. There is very little relationship to the amount of money any one individual pays and the amount of money he is entitled to receive. Social Security is a combination of a bad tax system with a bad way of distributing welfare… If you look at the tax system, who could defend a wage tax, a tax on wages up to a maximum, a tax on work, a tax which discourages employers from hiring people, and discourages people from going to work; a tax which is borne by the lowest wage group, workers? It is a regressive tax. You could never in a million Sundays… have gotten such a tax passed as a tax."

"Governments never learn. Only people learn."

"Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve System. I would like to say to Milton and Anna: Regarding the Great Depression. You're right, we did it. We're very sorry. But thanks to you, we won't do it again."

"The elementary truth is that the Great Depression was produced by government mismanagement. It was not produced by the failure of private enterprise, it was produced by the failure of government to perform a function which had been assigned to it."

"This leads to my next myth—the myth that government can spend money at nobody’s expense. What was really involved in that last story was that somehow the local people do not pay out the money coming down from Washington somebody else does. Of course, the truth is that the money makes a round trip between Florida and Washington, and there is a discount taken off for cash as it passes through Washington. Some of you may remember that wonderful description of government by the French economist, Frederic Bastiat, who said that government is that fiction whereby everybody believes that he can live at the expense of everybody else."

"That is a widespread myth, that it is possible to spend money with nobody paying for it. You have everybody screaming that we ought to have new, bigger, more generous government programs. Where are we going to raise the money? Tax business. But business corporations can’t pay any taxes. A corporate executive may sign the check, but where does he get the money? From his stockholders or from his customers or from his employees. Unlike the federal government, he doesn’t have a printing press in his basement. So the only way he can pay money to the government is imposing a burden on somebody. Government cannot spend money at nobody’s expense."

"His views have had as much, if not more, impact on the way we think about monetary policy and many other important economic issues as those of any person in the last half of the twentieth century."

"In this day and age, we need to revise the old saying to read, "Hell hath no fury like a bureaucrat scorned.""

"I say thank God for government waste. If government is doing bad things, it's only the waste that prevents the harm from being greater."

"If we have system in which government is in a position to give large favor - it's human nature to try to get this favor - whether those people are large enterprises, or whether they're small businesses like farmers, or whether they're representatives of any other special group. The only way to prevent that is to force them to engage in competition one with the other."

"It's nice to elect the right people, but that isn't the way you solve things. The way you solve things is by making it politically profitable for the wrong people to do the right things."

"One of the great mistakes is to judge policies and programs by their intentions rather than their results."

"Inflation is the one form of taxation that can be imposed without legislation."

"They had cliche answers but only to their self-created straw-men. To exaggerate only slightly, they had never talked to anyone who really believed, and had thought deeply about, views drastically different from their own. As a result, when they heard real arguments instead of caricatures, they had no answers, only amazement that such views could be expressed by someone who had the external characteristics of being a member of the intellectual community, and that such views could be defended with apparent cogency. Never have I been more impressed with the advice I once received: "You cannot be sure that you are right unless you understand the arguments against your views better than your opponents do.""

"I think the government solution to a problem is usually as bad as the problem and very often makes the problem worse."

"The problem in this world is to avoid concentration of power - we must have a dispersion of power."

"I want people to take thought about their condition and to recognize that the maintenance of a free society is a very difficult and complicated thing and it requires a self-denying ordinance of the most extreme kind. It requires a willingness to put up with temporary evils on the basis of the subtle and sophisticated understanding that if you step in to do something about them you not only may make them worse, you will spread your tentacles and get bad results elsewhere."

"There was nothing in these views to repel a student; or to make Keynes attractive. Keynes had nothing to offer those of us who had sat at the feet of Simons, Mints, Knight, and Viner."

"So the question is, do corporate executives, provided they stay within the law, have responsibilities in their business activities other than to make as much money for their stockholders as possible? And my answer to that is, no they do not."

"The great enemy of human freedom is the Government. By taking money out of our pockets and spending it, it destroys our freedom."

"Over the period covered by these data, a drastic change has occurred in the responsibilities undertaken by the state to provide assistance to the aged, unemployed and otherwise dependent. This change has had divergent results on the particular data under discussion. The availability of assistance from the state would clearly tend to reduce the need for private reserves and so to reduce private saving—it is equivalent, in terms of our hypothesis, to a reduction in the variance of transitory components."

"I have no right to coerce someone else, because I cannot be sure that I'm right and he is wrong."

"Now, when anybody starts talking about this [an all-volunteer force] he immediately shifts language. My army is 'volunteer,' your army is 'professional,' and the enemy's army is 'mercenary.' All these three words mean exactly the same thing. I am a volunteer professor, I am a mercenary professor, and I am a professional professor. And all you people around here are mercenary professional people. And I trust you realize that. It's always a puzzle to me why people should think that the term 'mercenary' somehow has a negative connotation. I remind you of that wonderful quotation of Adam Smith when he said, 'You do not owe your daily bread to the benevolence of the baker, but to his proper regard for his own interest.' And this is much more broadly based. In fact, I think mercenary motives are among the least unattractive that we have."

"The construction of hypotheses is a creative act of inspiration, intuition, invention; its essence is the vision of something new in familiar material. The process must be discussed in psychological, not logical, categories; studied in autobiographies and biographies, not treatises on scientific method; and promoted by maxim and example, not syllogism or theorem."

"Inflation is always and everywhere a monetary phenomenon in the sense that it is and can be produced only by a more rapid increase in the quantity of money than in output. … A steady rate of monetary growth at a moderate level can provide a framework under which a country can have little inflation and much growth. It will not produce perfect stability; it will not produce heaven on earth; but it can make an important contribution to a stable economic society."

"A largely parallel example involving human behavior has been used elsewhere by Savage and me. Consider the problem of predicting the shots made by an expert billiard player. It seems not at all unreasonable that excellent predictions would be yielded by the hypothesis that the billiard player made his shots as if he knew the complicated mathematical formulas that would give the optimum directions of travel, could estimate accurately by eye the angles, etc., describing the location of the balls, could make lightning calculations from the formulas, and could then make the balls travel in the direction indicated by the formulas. Our confidence in this hypothesis is not based on the belief that billiard players, even expert ones, can or do go through the process described; it derives rather from the belief that, unless in some way or other they were capable of reaching essentially the same result, they would not in fact be expert billiard players. It is only a short step from these examples to the economic hypothesis that under a wide range of circumstances individual firms behave as if they were seeking rationally to maximize their expected returns (generally if misleadingly called "profits") and had full knowledge of the data needed to succeed in this attempt; as if, that is, they knew the relevant cost and demand functions, calculated marginal cost and marginal revenue from all actions open to them, and pushed each line of action to the point at which the relevant marginal cost and marginal revenue were equal. Now, of course, businessmen do not actually and literally solve the system of simultaneous equations in terms of which the mathematical economist finds it convenient to express this hypothesis, any more than leaves or billiard players explicitly go through complicated mathematical calculations or falling bodies decide to create a vacuum. The billiard player, if asked how he decides where to hit the ball, may say that he "just figures it out" but then also rubs a rabbit's foot just to make sure; and the businessman may well say that he prices at average cost, with of course some minor deviations when the market makes it necessary. The one statement is about as helpful as the other, and neither is a relevant test of the associated hypothesis."

"If we are to use effectively these abstract models and this descriptive material, we must have a comparable exploration of the criteria for determining what abstract model it is best to use for particular kinds of problems, what entities in the abstract model are to be identified with what observable entities, and what features of the problem or of the circumstances have the greatest effect on the accuracy of the predictions yielded by a particular model or theory."

"The only way that has ever been discovered to have a lot of people cooperate together voluntarily is through the free market. And that’s why it’s so essential to preserving individual freedom."

"Make politics an avocation, not a vocation."

"The reality is that if you look at every program that the government has adopted in the direction of extending its scope, it took an enormous propaganda campaign by special propaganda groups to get those measures passed. There was no underlining public demand for those measures. On the contrary, the demand had to be created, it had to be developed, it had to be produced. And it was created, it was developed, it was produced, by people… who sincerely wanted to see an expansion in the scope of government."

"The whole justification for permitting the corporate executive to be selected by the stockholders is that the executive is an agent serving the interests of his principal. This justification disappears when the corporate executive imposes taxes and spends the proceeds for “social” purposes. He becomes in effect a public employe, a civil servant, even though he remains in name an employe of private enterprise. On grounds of political principle, it is intolerable that such civil servants—insofar as their actions in the name of social responsibility are real and not just window‐dressing—should be selected as they are now. If they are to be civil servants, then they must be selected through a political process. If they are to impose taxes and make expenditures to foster “social” objectives, then political machinery must be set up to guide the assessment of taxes and to determine through a political process the objectives to be served. This is the basic reason why the doctrine of “social responsibility” involves the acceptance of the socialist view that political mechanisms, not market mechanisms, are the appropriate way to determine the allocation of scarce resources to alternative uses."

"I remember being profoundly amazed that anyone would suppose that a little wooden desk would provide a safe haven in the event of an atomic bomb being dropped on Des Moines. But evidently they all took the matter seriously, for even the teacher, Miss Squat Little Fat Thing, was inserted under her desk, too—or at least as much of her as she could get under, which was perhaps 40 percent. Once I realized that no one was watching, I elected not to take part. I already knew how to get under a desk and was confident that this was not a skill that would ever need refreshing."

"And then suddenly I would realize that I couldn’t remember, hadn’t actually consciously experienced, any of the last forty-seven properties I had visited, and didn’t know if I had left a paper or just walked up to the door, stood for a moment like an underfunctioning automaton, and turned around and walked away again. It is not easy to describe the sense of self-disappointment that comes with reaching the end of your route and finding that there are sixteen undelivered papers in your bag and you don’t have the least idea—not the least idea—to whom they should have gone. I spent much of my prepubescent years first walking an enormous newspaper route, then revisiting large parts of it. Sometimes twice."

"So to sleep on the sleeping porch required preparation. First, you put on long underwear, pajamas, jeans, a sweatshirt, your grandfather’s old cardigan and bathrobe, two pairs of woolen socks on your feet and another on your hands, and a hat with earflaps tied beneath the chin.Then you climbed into bed and were immediately covered with a dozen bed blankets, three horse blankets, all the household overcoats, a canvas tarpaulin, and a piece of old carpet. I’m not sure that they didn’t lay an old wardrobe on top of that, just to hold everything down. It was like sleeping under a dead horse. For the first minute or so it was unimaginably cold, shockingly cold, but gradually your body heat seeped in and you became warm and happy in a way you would not have believed possible only a minute or two before. It was bliss. Or at least it was until you moved a muscle. The warmth, you discovered, extended only to the edge of your skin and not a micron farther. There wasn’t any possibility of shifting positions. If you so much as flexed a finger or bent a knee, it was like plunging them into liquid nitrogen."

"Making models was reputed to be hugely enjoyable... But when you got the kit home and opened the box the contents turned out to be of a uniform leaden gray or olive green, consisting of perhaps sixty thousand tiny parts, some no larger than a proton, all attached in some organic, inseparable way to plastic stalks like swizzle sticks. The tubes of glue by contrast were the size of large pastry tubes. No matter how gently you depressed them they would blurp out a pint or so of a clear viscous goo whose one instinct was to attach itself to some foreign object—a human finger, the living-room drapes, the fur of a passing animal—and become an infinitely long string. Any attempt to break the string resulted in the creation of more strings. Within moments you would be attached to hundreds of sagging strands, all connected to something that had nothing to do with model airplanes or World War II. The only thing the glue wouldn’t stick to, interestingly, was a piece of plastic model; then it just became a slippery lubricant that allowed any two pieces of model to glide endlessly over each other, never drying. The upshot was that after about forty minutes of intensive but troubled endeavor you and your immediate surroundings were covered in a glistening spiderweb of glue at the heart of which was a gray fuselage with one wing on upside down and a pilot accidentally but irremediably attached by his flying cap to the cockpit ceiling. Happily by this point you were so high on the glue that you didn’t give a shit about the pilot, the model, or anything else."

"I knew more things in the first ten years of my life than I believe I have known at any time since. I knew everything there was to know about our house for a start. I knew what was written on the undersides of tables and what the view was like from the tops of bookcases and wardrobes. I knew what was to be found at the back of every closet, which beds had the most dust balls beneath them, which ceilings the most interesting stains, where exactly the patterns in wallpaper repeated. I knew how to cross every room in the house without touching the floor, where my father kept his spare change and how much you could safely take without his noticing (one-seventh of the quarters, one-fifth of the nickels and dimes, as many of the pennies as you could carry). I knew how to relax in an armchair in more than one hundred positions and on the floor in approximately seventy- five more. I knew what the world looked like when viewed through a Jell-O lens. I knew how things tasted—damp washcloths, pencil ferrules, coins and buttons, almost anything made of plastic that was smaller than, say, a clock radio, mucus of every variety of course—in a way that I have more or less forgotten now. I knew and could take you at once to any illustration of naked women anywhere in our house, from a Rubens painting of fleshy chubbos in Masterpieces of World Painting to a cartoon by Peter Arno in the latest issue of The New Yorker to my father’s small private library of girlie magazines in a secret place known only to him, me, and 111 of my closest friends in his bedroom."

"On April 3, 1956, according to news reports, a Mrs. Julia Chase of Hagerstown, Maryland, while on a tour of the White House, slipped away from her tour group and vanished into the heart of the building. For four and a half hours, Mrs. Chase, who was described later as “dishevelled, vague and not quite lucid,” wandered through the White House, setting small fires—five in all. That’s how tight security was in those days: a not-quite-lucid woman was able to roam unnoticed through the executive mansion for more than half a working day."

"In those days kitchen matches were heavy-duty implements—more like signal flares than the weedy sticks we get today. You could strike them on any hard surface and fling them at least fifteen feet and they wouldn’t go out. Indeed, even when being beaten vigorously with two hands, as when lodged on the front of one’s sweater, they seemed positively determined not to fail."

"He hit the water—impacted really is the word for it—at over six hundred miles an hour, with a report so loud that it made birds fly out of trees up to three miles away. At such a speed water effectively becomes a solid. I don’t believe Mr. Milton penetrated it at all, but just bounced off it about fifteen feet, limbs suddenly very loose, and then lay on top of it, still, like an autumn leaf, spinning gently."

"Your brain is marvellously efficient. It requires only about 400 calories of energy a day — about the same as you get in a blueberry muffin. Try running your laptop for 24 hours on a muffin and see how far you get."

""Wow, look at all the places you can park,” he said, as if for all these years he had been cruising endlessly, unable to terminate a journey. For about a year the most dangerous place to drive in Des Moines was the parking lot of Merle Hay Mall because of all the cars speeding at joyous random angles across its boundless blacktop without reflecting that other happy souls might be doing likewise."

"Nearly a quarter of American men were in the Armed forces [in 1968]. The rest were in school, in prison, or were George W. Bush."

"One of my duties, this week, is to open the new Ustinov college," he confesses, "and while I'm delighted that Durham should honour its former chancellor this way — and I sincerely hope it continues this tradition for me — I can't help feeling that an American university would only have done so had the chancellor also handed over a substantial amount of dosh."