Capitalism and Freedom Term Paper

Topics: Capitalism, Free market, Market economy Pages: 7 (2518 words) Published: May 2, 2012
Term Paper
Capitalism and Freedom, written by Milton Friedman, seems to focus significantly on the connections between the economics and politics, and the effect that those have in various aspects of society. This relationship was referred to throughout the book, and the topics Friedman discusses ranged between governmental control of money, to foreign policy and trade and the effect that has on our economy. Through the course of the book, Friedman constantly refers to his “classical liberal” view, which focuses on the freedoms and power of the individual in society. Friedman shows his support of this view during the book using the idea of a laissez-faire government. For Freidman, government involvement in issues regarding society should be minimized, and the government should only really use their power to assist society when things are not going well. Friedman believes that government should only be the most basic form of overseer of the nation. The thought of the free market driving the economy strongly prevails within the book. He claims that the government should only be there to reduce the inevitable rises and falls of the economy when it is free market based. This way, the changes in the market will be able to remain less drastic. Friedman refers to the capitalist system as an unstable form of economy, and that government should be more of a support structure, rather than the basis of the economic system. He strongly believes that too much governmental influence would restrict our rights and liberties. This belief was one of his main focuses through the entire book. Friedman states in the introduction “Our minds tell us, and history confirms, that the great threat to freedom is the concentration of power.” (Pg. 2)

Friedman’s second main point was that the free market system promotes innovation and advancement by providing competition. People have motivation when they are working against someone else toward the same goal, unlike the socialist form of economy, which results in a lack of incentive due to the lack of a reward. Capitalism provides opportunities to improve and expand ideas into more effective and more efficient ones; a fantastic example of this is today’s cell phone. Without the capitalist economy, the cell phone would still be the most basic of telecommunication devices to speak with a person in a different location. Instead, however, it has evolved into a tool that can be used to do nearly everything. From looking up the definition of socialism on the internet to having your phone be your personal assistant, even to typing this paper, they have become extreme devices of ingenuity. What is the reason for the expansion of a basic communication gadget into a computer we can fit into our pocket? It is people trying to improve ideas to sell their products to society. The general public would not buy a product if it wasn’t as good as the next one, and the people producing would not make any profit if no one is purchasing their products. Thus, new ideas and innovations are born in order to be successful in a capitalist system. I believe that the inverse is the socialist system, in which labor and innovation are meant for the “betterment of society” instead of for the opportunity to gain recognition and success for our advancements. This dispersion of credit to the entirety of civilization defeats any reason to come up with new ideas and improvements for anything. As we discussed in class, people become more efficient because they work to be better than someone else.

Friedman constantly refers back to the point of government operating at only the most basic level. His view of a perfect government is of one that is seemingly non-existent. Government should focus on making the lives of the individuals of the nation better, instead of taking that responsibility into their own hands to define what “better” really is. Friedman claims that a free market economy creates “unanimity without conformity” (Pg. 23) and...
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