Milton Friedman - The Social Security Myth
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- čas přidán 4. 03. 2010
- Using Social Security as his prime example, Professor Friedman explodes the myth that the major expansions in government resulted from popular demand. In a speech delivered more than 30 years ago, he directly relates this dynamic to today's health care debate. www.LibertyPen.com
Source: Milton Friedman Speaks
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Depressing as hell to think a man as brilliant as Milton Friedman spent his whole life educating and warning people about unrestrained government spending, and today the phenomenon is worse than ever. If Friedman couldn't save us, I'm not sure there's anyone who can.
+BigBossIsBack Was Friedman not a proponent of deregulation of the financial sector? Deregulation of the banking industry was the cause of the global recession. I think Iceland's current President was debating with Friedman in the 80s about such issues and was made to look like he was a loony lefty only to appear decades later as the one who was actually correct. Iceland jailed their bankers and never went down the austerity route which is just having the poor pay for the mistakes of the rich. Iceland is now the fastest growing economy in Europe. Am i missing something here?
This is not entirely accurate. Government meddling with internal banking regulations in the United States is what chiefly led to the sub prime mortgage crisis. The federal government essential forced private banks to bend their lending practices and offer loans to lower quality applicants who were more likely to default on them. This in turn made banks devise complex financial instruments in order to make these applicants appear eligible by previous standards. When the tidal wave of foreclosures crashed into the derivatives market, the housing crisis turned into a credit crisis, and general financial distress began. The Icelandic banks largely escaped the fracas because they has limited exposure to these derivatives and the banks that packaged them. Milton was in favor of reducing government regulation of private enterprise, including banks; he was not in favor of banks relaxing or discarding their own internal regulations and becoming reckless institutions.
+todd dyer Reckless behaviour by the banks was indeed a deciding factor for the crisis. But you should ask yourself why the banks would act so foolish? They obvioulsy doesn't want to go bankrupt, that's not good for anyone. The problem is the governments policy of bailouts. The banks know that they can afford to take higher risks, because if they go under, they will be bailed out.
In 1907 there was also a bank crisis, this was before the FED even existed and with very limited government involvment. In this instance the crisis was resolved by the banks themself, perticually by JP Morgan which used a substansial amount of money to shore up the banking system and purchase firms which went under. With such a regime where banks are totally independent, there is an economic incentive to act responsible.
+todd dyer Well, the reason why the crisis erupted was because mortage payments weren't comming in anymore. Which was in turn caused by legislation forcing banks to give out subprime mortgages, as well as the policy of bailout, giving the banks extra incetives to take higher risk -> giving out more subprime mortgages. If the payment on mortgages had been conducted, those CDO's would have been profitable
+todd dyer don't you understand that it is again the government NOT doing its supposed job that led to the banking bubble? Who was to review and check banking activity? In Europe, where I live, it is the central bank that does the policing isn't it the same in the States?
This man is the essence of the Republic.
The country we once were.
The country we should be, the government started growing the second it was created so I don't agree that our country was ever as great as Milton's projections
I couldn't agree more, David. The "essence" of what we once were: smug, cynical, self-serving, selfish, racist, contemptuous of the poor, xenophobic, and a sellout to corporations; which Friedman was.
It's very sad that that's what you yearn for now.
@@maskedmarvyl4774 LMAO! How were we Xenophobic? We had people coming here from every nook and cranny on this planet. You just don't know what the hell you're talking about. You just prefer to enslave people.
The country we CAN and SHOULD be if we manifest it!
@@zangetsudx1 , uh...........sure, ma'am.
We need more economists like this man. Outspoken, reasonable, and easy to understand.
Check out Learn Liberty. They have a multitude of easy to understand economic videos. I think that you would enjoy them as much as I do.
Check out Peter Schiff, Robert P Murphy
Schiff is my boi! I'll check out Murphy. Thanks bud
ScottyBleez Milton Friedman was the enemy of Austrian economics, by the way.
Here is the problem that Milton does NOT say...... Social Security is fine. However, the gov transfers SS money to the treasury towards the deficit and if allowed the gov will bankrupt SS. The gov also wants to use the current SS surplus to fund unnecessary wars so that the politicians can get money under the table from war suppliers like Haliburton. So you see the gov creates this myth that social security is in trouble. If the public buys the propaganda, then they go ahead and fleece social security since the public will expect benefit cuts due to the govs hysteria causing BS. So if you don't want that to happen then let your politicians know that you won't vote for them if anti social security laws are even considered. That folks is what you didn't hear from Milton.
America's biggest problem is that at least half of it's citizenry is ignorant to its own history. They have little understanding why it's founders looked to create a government with limited powers(as evident it the lack of vision in seeing both of their major parties continuously violate their laws and constitution). Personal responsibility seems foreign and it is scary. They do not understand what they allow to be justified in having more and more of their liberties taken away.
so what are you suggesting,. . . . erm... public education? lulz
@@etylexus_4711 Hahahaha, exactly. You can hardly believe that "half" the citizens of America are ignorant of her history by accident. Nonsense, it's by design, compulsory government primary and secondary are the worst things you can do to a child. If the curriculum weren't bad enough they also have ridiculous ways of "evaluating" children so as to get them hooked on pharmaceutical drugs to turn them into semi conscious lemmings.
Dr Franklin's quote remains true....trade liberty for safety...wind up with neither.
"Social Security is a combination of a bad tax system with a bad way of distributing welfare." -Milton Friedman
+Gerri Lynne Yes, but when the market doesn't work, someone else need to take care of these things.
+WaterPocket It sounds as if you're assuming the depression was caused by a failure of the private sector.
+Waterpocket
Translation: Yes, but when peaceful, voluntary means don't work, we must use violence to take care of these things.
WaterPocket fucking communist
I say it's the people managing the system who are corrupt, not the system, and how is it "welfare" if we contribute to the program. SS works just fine thank you very much, I'm living quite comfortably off my IRA investments and took my SS early at age 62, and retired early at age 50 in the Land of Smiles. Moreover, being self employed the majority of my career I contributed double what a regular employee pays in. Yes the system needs reform, starting with removing the high income earner contribution cap. In Your FACE Milton you right wing windbag, you would fit right in today with the Trumpanzze brigade who loves to get high on hate "Let them eat CAKE"!
One of the biggest disappointments in my life is that I will never get to meet Dr. Friedman. What a great resource these CZcams videos are.
The difference between SS and a Ponzi scheme is that you can escape a Ponzi scheme if you catch it early.
Then go live where they don't have it, my simple friend.
Oops, I see you already are.
A little too obvious there, Ivan. Back under your bridge now, my sad little friend; no ruble (or cheap vodka) for you....
Well if you want Socialism you just need to go 90 miles South of Key West. Where do you get pre New Deal Capitalism?
@@melc311 I think he's trying to suggest that without social security most Americans (a majority of which have little or no retirement savings and are living paycheck to paycheck) would be beggars after they get too old to compete for a job (if not for social security)
@@maskedmarvyl4774 That's hardly a logical argument. It not only skips addressing the system entirely, but it also presents a false choice as if staying where you live inherently means you consent. Are you going to also make the argument that anyone born into any nation should then never wish to change a law or policy?
And why is it that the people who want a system are not the ones that have to move to a nation that already has what they're asking for? Again, it's an illogical argument.
@@itWouldBeWise So instead of having policies that alleviate those issues, we have to have a ponzi scheme that takes money from people who we're told barely have money so that they can retire? You do realize how stupid that sounds right?
I like the way he predicted Obamacare at the end 8:55
Obamacare is what you got because you listened to people like Friedman. Other countries went single payer or public option and they insure everyone today as a result, whereas you have the most expensive, most inefficient system in the developed world, killing millions who are too poor to afford treatment.
@@OolTube02 I'm curios, how is the rising cost healthcare-related to insurance and how would Obamacare bring down the cost?
@@OolTube02 You are so wrong.
The only reason why specialised medicine is somewhat decent in other nations is because the US subsidises research and development for the world for healthcare.
Also, our healthcare system is universal I'm that people can't be turned away at hospitals. So the idea that poor people die is so dumb. Poor people get Medicaid.
Also, the healthcare system in the US is not Milton's model. There are many government regulations that limit competition, bring overhead costs up, and control what coverage is given.
@@randomkid7390 If a single doctor's visit can bankrupt you then it keeps poor people from going until they're really sure what ails them is an emergency. At which point it may be too late and something that's stage 4 at this point. It also makes treating it extra expensive. For everyone.
Or, even if you're sure you have cancer and you know treating it can wipe out your entire family's fortune, you may opt in favor of dying, just so you don't leave your spouse and children destitute.
This is horrible. If you think this is the sacrifice Americans have to make in order to create medical advancements that help the rest of the world then, oh, what a nasty and brutish world it is! This is a Dr. Mengele level perspective on what's needed for scientific research.
And if you're _wrong_ it's extra tragic. Then you're sacrificing yourself and your compatriots for nothing. Then you're only dying even though in a world in which you weren't dying medical research would advance just as rapidly.
And you _are_ dying. Life expectancy has been going down recently, and only in the US.
So, either way, what can I say but _"Jesus F***!"_
@@OolTube02 The reason why treatments are expensive are not the treatments themselves. It's the research. If you don't pay for the research, the treatment won't exist to begin with. If the healthcare field wasn't so regulated by the government insurance would be easier to get and much cheaper. Procedures and drugs would also be much cheaper.
When a treatment gets invented in the US, the inventor gets a patent. This is a good thing because it incentivizes more research. Other countries don't follow the patent rules, they just give the procedures. This is why it is much cheaper for them. If the US went to socialised medicine, those other countries wouldn't get free research anymore.
This man was an intellectual GIANT among mere mortals....Rest in peace....
Great new book from John F. Cogan "The High Cost of Good Intentions." Goes through not just Social Security; he tackles every federal program back to Revolutionary War veteran pensions. Very informative.
Added to my wishlist, thanks for mentioning it!
Chief Justice Earl Warren (April 1952): “Many people consider the things which government does for them to be ‘social progress,’ but regard the things government does for others as ‘socialism.’”
He nailed the Obamacare scam.
I'm only alive because of Obamacare. I worked in insurance, and despite that, they excluded coverage for my diabetes. Obamacare forced them to actually cover me medically for that. I had already suffered permanent vision loss and nerve function because of lack of treatment. Not that you care about any of that.
What country are you trolling from, my sad, simple friend? What made you come here just to make that troll comment? I'm sorry they don't have health coverage where you are. But I'm sure they have lots of cheap vodka for you to stay drunk on, my simple friend. Until you die of cirrhosis of the liver, without medical treatment.....
@@tarkfarhen3870, lol, you mean the "scam" that your grandparent's depend on? Why don't you call them and tell them to disenroll from this "scam", Daway? Oh, that's right, you can't; because you're not from a country that has Social Security. What country are you trolling from, my simple, sad friend?
@Aethel Yfel , Obamacare is the only reason why I and my niece haven't died from diabetes.
What country are you trolling from, my sad, sad, simple little friendless troll doll?
Stay drunk, Ivan; stay drunk.....
BAMA, a black man was President; twice. And he's much, much smarter than you are.
His wife is smarter than you are.
Their kids are smarter than you are.
Their dog is smarter than you are.
Their dog's chew toy is smarter than you are.
Deal with it and move on, my sad, simple internet ghost....
MaskedMarvyl you’re a parasite if you work for an insurance company begone parasite
Progressive taxation has provided no benefit at all to overall living standards (no type of taxation ever has). Social programs have done a tremendously poorer job of meeting the needs of the poor than private charity (particularly mutual aid societies crowded out be government. the minimum wage has DECREASED living standards - putting people out of work and Social Security has been a raw deal for participants largely transferring wealth from working class black men to wealthy white women.
This is why I laugh at people whenever they argue in favor of socialism by saying "look at social security".
They don't even realize they are arguing against themselves.
Feel free to move back in time and risk having to spend your old age destitute and freezing in a chicken coop, as some of the elderly during the Great Depression did...
we're all going to be in chicken coops when these social programs either rob us blind or go belly up entirely. Or we can manage our finances, make smart investments, and most importantly stick close to family and have lots of kids to take care of you later in life like things should be. But go ahead keep pouring bailing water out of your leaking boat.
+s0nnyburnett You really ought to read up on Modern Monetary Theory. Or to watch a few videos on the subject. An economy is not a household. In fact enter "Angry Birds MMT" into the CZcams search field and watch the video that crops up! It'll enlighten you and it's somewhat entertainingly presented.
So far supply side economics and the minimalist government ideology of Milton Friedman has pushed people further back into third world chicken coop territory than the New Deal ever did or other developed countries' social market economies have.
The '70s stagflation crisis was an actual supply-side crisis. Home-extracted oil had passed Hubbert's peak and the OPEC was able to drive oil prices up to the point where it was choking everything -- particularly in the US, which had made itself fully car-dependent and sprawled out. It was only when the OPEC monopoly was defeated and oil prices came down that everything went back to normal.
But this is not what the Great Depression was like or the Great Recession. They were not the result of an actual essential resource suddenly becoming scarce and expensive. They were purely the result of _money_ suddenly not being available any more to parties creating demand. This is where austerity and fear of inflation and choking the welfare state does the most damage.
If you want to point to demand-side economics doing good you can point out the fact that it first got the country out of the Depression and then kept going for forty years, creating unprecedented increase in prosperity across all income classes. It made the rich richer and the poor richer.
The only success you can point to regarding supply-side economics was that it seems to have ended the '70s stagflation but then it kept wages stagnant and social services reduced and created an amount of wealth inequality that's usually only seen in third world countries. It made the rich richer and the poor poorer again.
You wouldn't have Trump today, promising to make the country "great again," if it hadn't.
@@Snobbishbumpkin Wages increase as demand increases. If there's a lot of demand for goods and services more people get hired, they have more bargaining power, and wages go up. If there's no demand then lots of people compete for few jobs and wages remain low. What's more, purchasing power remains low, custom remains low, demand remains low, jobs remain low, wages remain low, and purchasing power remains low in a vicious circle.
That's why the New Deal made everyone richer while Reaganomics made only the rich richer.
Apparently it is counterintuitive to most people that it is demand that fuels the economy, not supply. But it should be obvious that as a supplier you don't invest and grow if you don't think you can sell your increased supply. That's why it doesn't make sense to give the supplier more money directly. You have to give the customer more money, giving the supplier the incentive to earn the money from the customer by creating goods and services for them.
Milton Friedman outlined the dangers of big government over and over again. A brilliant man such as he, understood, that what president Reagan put in one sentence. Government is not the solution to a problem, government IS the problem.
Milton Friedman personified clarity, grace and intelligence...RIP.
This man had one of the most incredible minds in our history.
Wow, Milton Friedman predicted Obamacare all those years ago. Well there you have it, no demand for health insurance. Govt policy forcing people to get health insurance and healthcare costs go up and isn't really more affordable. Thanks Obama!😊
My country has universal healthcare. My healthcare will never cause me to be bankrupted. My country's population has a longer expected lifespan and a high standard of living. My country is NOT the USA. We don't say "Fuck government" here.
DJW1959Aus Congratulations.
And my condolences to you.
Obamacare is not public health insurance. It's the government forcing people into private health insurance with a bunch of subsidies. It's because of people like Friedman that this was the best that the Democrats thought they could achieve. Literally every other developed country has better, cheaper health insurance than the US. The amount of suffering Friedman's philosophy has caused and still causes in the US is immeasurable.
Oh dude.....travel outside of your yank state and actually see what every other more civilized nation did.
Milton Friedman was way ahead of our time. Just think he was saying this in 1978
RIP Dr. Friedman, I guess America's going to learn the hard way you were right.
When it gotten this bad, it need to happen.
When you badly ignore gravity and walk over the cliff, the crash will teach you why you shouldn't. Hopefully it won't be your last lesson.
as stefan molyneux points out: we should be so lucky for social security to have the same status as a ponzi scheme. That way, we could leave voluntarily at any time!
Exactly, social security is worse than any ponzi scheme could ever be
Yet SS is the only federal program that runs a surplus very year. If it were a Ponzi scheme it would have collapsed long ago.
+Juy Fair the only reason SS hasn't collapsed is because the working class pays in more then is currently being paid out. That's because the working class is much larger then disabled/elderly class, every year. The year the working class becomes smaller then the disabled, were in serious trouble as a service nation
You have assumed that workers in the past produced the same amount of output as workers today. But that's obviously ridiculous. In the 50's GM had 400,000 workers and produced fewer cars per year than today with 40,000. Productivity gains affect not only manufacturing workers, but in fact are the source of the rising standard of living across the whole economy. And that includes supporting retirees. Today's workers make more than their predecessors in real terms even after paying more in payroll taxes. That's the effect of productivity gains.
I hate agreeing with that creepy psychopath
One of the most intelligent man has ever faced the earth.
About as destructive as Karl Marx, though, unfortunately. He's the extreme opposite end of the political spectrum.
I'm from Brazil and the discussion of social security is - again - under discussion. Mr. Friedman speech is 100% contemporary!
This dudes legit.
I wonder how Mr. Friedman would feel today if he had to pay $14,000 per year for health insurance.
It also didn't help that LBJ had social security shifted from the private account into the general fund and the Feds have been dipping into that repeatedly to pay the bills. Then come back to the people every few years to scare us to death about how Social Security is in trouble and will be broke within a decade. Then at the zero hour, somebody allegedly re-crunches the numbers and they back off and say that we're ok for the next 25 years or so but we will have to do something soon. And every time someone has an idea to do something (e.g. W with his idea of privatizing it with is investing in our accounts personally) they get decried as being anti-elderly or trying to cripple the young and poor yatada yatada yatada.
Agreed. I'm glad you are finally coming around.
thanks for the explanation, it was really necessary and germain to the discussion.
I'm paying Social Security yet I'm not even counting on that when I retire, because I know very well that by the time I retire Social Security will be BROKE. Social security is an example of the complete INEPTITUDE of government. If I would put the money I put on social security on a private insurance company that offers a retirement plan I would have an enormous amount of money by the time I retire compared to social security.
social security was a ponzi scheme from the start
slaving away for nothing, aye? Thank your parents/relatives from the previous generation who claim to "love" and "care" for you, yet probably did nothing to prevent this grand theft.
Don't forget the amount your employer pays on your behalf... the true reason why is because the system pays for all sorts of folks who never paid in... overdose on heroin and fry out, no problem get disability rest of your life...
Every time government "regulates" something it does 1 of 2 things. 1. It's superficial and the industry regulates itself in reality - regulating smaller competitors out of the market that is. or 2. The government "solves a problem" in the market, usually by throwing money at it, and ends up breaking the market instead (IE: The Banking problem you refer too).
Love how he says the market has failed to provide services. Hits the nail on the head.
9:30
Sounds like Obamacare.
Greenspan couldn’t carry this man’s jockstrap. We need more people like Mr. Friedman in government. Mr. Kudlow is as close as we have to in the same ballpark as Milt.
Oh come on! Friedman was a top economist who impressed the right and left. Krugman frequently quotes him
Eventually you start to notice that all the people who defend these systems so vehemently are so much against even making them optional. These are systems so great and benevolent, that people must be brought in and kept in by force.
Does anyone know where and when he gave this talk ? Its a great reference.
To the contrary, I am not forgetting about the WHOLLY NEGATIVE impact on living standards of most of those things. Neither womens' rights or democracy are unique to any economic system. And the demise of child labor was a result of that capitalism-provided improvement in living standards. That improvement has happened most where unions and state intervention has been least (particularly in the less unionized US vs. Europe). And, again, it was the competitive labor market that improved wages.
This man predicts the future, "someday people will demand nationalized health insurance" well its 2018 and medicare for all is the democrats platform so. By the way I would to be against nationalized health insurance if all it did was allow people do bargain collectively with health providers. I feel like a system such as that could compete with the patient centered system we have now. What I am against is the massive subsidy regime that comes with it
The bureaucracy that comes with it is the issue that destroys us. Catch-22's all the live long day. Joseph Heller understood the way bureaucracy is meant to work
Even Friedman seems unaware of the extensive covert (and probably not entirely intended) redistribution that takes place through social security. Because women live longer, it redistributes income from men to women. Because educated people are healthier and live longer, it redistributes income from the working class to the middle class. Because women are a majority of voters, Social Security has a higher relative payoff for workers whose work histories are less than 30 years, and whose annual incomes were modest (both are true of most women), than to workers who work 40+ years for substantial wages. The result is that those of modest means hold on to Social Security for dear life, while the upper middle class is disenchanted with it, because they would have done better if the FICA taxes they paid over their working lifetimes, had been invested in the stock market. Privatising Social Security makes this covert income redistribution impossible, which is why privatisation will never happen.
@katakisLives Fair enough. I respect your tenacity for such an important subject. May you live a long and happy life.
About public health care being a recipe for inferior medical practise and long waiting lists are true. In Norway we have free health care for everyone. You are not likely to pay more than 400 dollars for anything and certain percription drugs are free for senior citizens. The free health care system over here has created all the predictions Milton Friedman describes here and in other videos about health care.
your universal health care isn't free; You actually over pay for by paying FAR too much in taxes.
I agree with that. Our "free" health care is paid for by excessive taxes, long lines and inferior quality. It is far from free. Currently there's a debate going on to raise taxes even higher, of course "for the rich". BUT there are no rich people in Norway, except a few who ventured outside of our borders and invested in other countries. So most of their taxes goes to foreign nations. To be clear though, I totally agree with the "rich" venturing outside Norway to grow their wealth. The current tax rate for a normal income, about $70k is about 50% to the government and then you are also taxed on a local level too, not a set percent, just fees you need to pay. In addition to this taxation, all roadwork is financed by toll booths, so you have to pay thousands of dollars per year if you drive a lot. The sales tax on all ordinary goods is also very high, 25% Value added tax, compared to the 3-10% you see in the states. To conceal the Value Added Tax all prices are given included the tax, that way no one cares about the high tax on goods and services. Norwegians likely pay 80-90% of their income back to the government in some kind of tax thought the year. This is FAR TOO MANY TAXES.
Socialism. Is. Force
In my country (France), it worked perfectly well. Poor Milton Friedman didn't even take time to have a look at one the greatest successes of time. And Americans still continue to worship the greatest mediocre of all time. God bless America, you really need it with so dreadful thinkers.
@Alex Takessian Your answer is grotesque but you are no Shakespearian fool and there is no wisdom in your words. Now, you must keep in mind that the unemployment rate in the US is much higher than what is generally thought. First of all, the participation rate is very low and there is no reason for it to be so low. It's just a trick to reduce the unemployment rate. And there are also those who are out of the statistics, and even the part time workers who are considered as unemployed in France and not in America. If the participation rate was not phoney and if the people I mentioned were in the statistics like in France, you wouldn't be bragging about the low unemployment rate in America.
And let's now focus on other figures. Obama reduced employment with an official rate that was around 5% and under Trump's presidency, it was as low as 3.5%. Well, these figures are not accurate, as I have said, but the truth is that to reach these rates, public debt has soared. Obama was the champion of public spending but Trump, who reproached him for that, made the public debt soar too ! And all this means that your so-called good unemployment rate is associated with an increase of public debt. So the figures are nothing but a lie ! If unemployment was so low in America, you wouldn't have such a huge public debt (more that France by the way).
And growth in your counrty is also associated with an increase in private debt. As wealth is unevenly distributed, people are obliged to borrow to live properly. And when they can't reimburse, the system collapses. That was the case in 2007-2008, and that was also the case last September when the Fed was forced to inject hundreds of billions into the repo market to avoid another major financial crisis!
Now, those who remain faithful to Friedman's theories are cursed. They are just unable to see beyond the surface of things. I have often wondered why Friedman always had this kind of sardonic smile on his face. Now, I understand. It's the smile of a con happy to fool people...
Now, a few words about France: our country started going wrong when we started putting into practice neoliberal ideas. They wrecked our country (and most of the countries that copied America) and we now have to face a huge economic crisis because our hospital was destroyed by these policies.
But you'll understand how bad the system is too. What was over the rainbow before the coronavirus crisis in The US? Millions of poor people unable to go to the doctor's, millions sleeping in street, students obliged to carry the burden of debt during the major part of their lives... Do you call that a country ? Do you even know that when the USA was a thriving country, taxes were as high as 90% for the wealthiest? If you want to make America great again, you’ll have to think about this tax rate.
Keeping the government out of private business is a huge part of his ideology. That not happening and government trying to "solve problems" in the private sector is what led to the banking problem, and the resulting bailouts, both prevented if we only followed Friedman's teachings.
When we tax businesses, we basically use resources that could've gone to future generations. Businesses creates capital, and this capital is reinvested in order to generate new ways of satisfying future demands. Whenever we take resources from the businesses generating our wealth, and use it to give luxury treatments to people there's really no financial coverage for, we are basically unabling capitalism and prosperity. Stay within the confines of what is affordable to us! That's real wealth.
I paid into social security all my 40 years of working and when I turn 62 goddam it I want it.
That money is gone. Do you know what a Ponzi scheme is?
VidkunQL if the money is gone, why are people still getting checks?
+monjiaitaly Did you listen to the video? SS doesn't work the way you seem to think it does. The money you paid is not sitting in a bank account with your name on it, waiting for your 62nd birthday; it's gone. There is no such store of money set aside for you. You might receive benefits, but if you do they'll have no connection to the money you paid.
VidkunQL don't care, I paid into it, I want it.
*****
I understand. I too want things to which I have no right.
Don't think. Just obey.
Jeff Dumas
That's right Jeff, many people think socialism will give them some sort of free ride in life. Why should I pay with my time and effort for someone's "right" for additional party time? As for communism, I don't quite feel like being a farmer in a kolhoz because I have different talents, so did probably a lot of people who were trapped in a cage like that. It is called having a choice.
That's a misnomer. Tax rates were high in the 1950s but tax receipts were just around 17% of GDP due to tax breaks. Now the 17% actual rate may be high to some and low to others but it has almost always been in the 15-20% range since WW2. Glad to help.
My heart sinks in the last few seconds when he talks about ObamaCare...
Man... we messed up. What are we gonna tell our children...?
@Kikkins ok, this is the last one... the first article of the italian constitution reads "Italy is a democratic republic founded on labour. The sovreignity belongs to the people and is exercised in the forms and within the limits of the constitution". Sorry if the translation is a bit shoddy! And by the way, apparently our (Italian) constitution was inspired by the american one! You can find all the clarifications you need in a constitutional law manual for political sciences undergrads.
@abbadabbadolittle
Are there any examples of Milton Fiedman ever praising Pinohcet of Chile?
I can understand the sentiment, I thought the same, and it seems that way: less regualtion and government = huge crash. BUT if you dig deeper its really not the case. The Fed, first and foremost, is largely responsible for the bubble and crash. Various government policies in the tax code, as well as covering losses helped fuel the bubble more. US government + Fed gave incentives to those banks to be so irresponsible...then bailed em out.
I don't believe in any taxes. Get rid of the whole system. Our forefathers would be ashamed.
Today I would love to hear Dr. Friedman address the “woke” culture and “progressive” liberals and George Soros.
When was this speech given, 2010?
I’m 34 and I have accepted the reality that I probably will never “retire”. I’m ok with that because the concept of retirement from work is a relatively new concept that is only a reality for those who made sound financial decisions with a little bit of luck. If I’m smart enough, I’ll be able to grow a nest egg. My own personal responsibility in finance towards my future self is the only thing that can make retirement a reality.
@Ultramenacer That is why there is insurance. And as it stands now, there is the FDIC forced "insurance" anyway. Friedman never wanted to strip benefits of CURRENT beneficiaries, but change it "from here on out." You would get your benefits based on the current formula.
I respect the way that when you say something is right you believe it and expect others too. I'll take your word for it when you are a Nobel prize winning economist with 60 years of teaching experience.
When was the last time someone in the UK was refused treatment for cancer, because they couldn't afford to pay for it. Happens all the time in the US. That's the free market - can't pay, then time to die. The Insurance Company death panel.
Our Health Care answers to shareholders before sick people.
LibertyPen, thank you for your response. Do you have more videos on Social Security? I am currently working on a paper about Social Security for one of my Econ courses. It would be of great help
How did it go cuz rn its a gold mine of things to write
@@epsilon3821 lol ! I do not remember.
@@78g476 holy shit ur still alive
Any retrospective since then?
GOODNESS GRACIOUS! WHAT A FIERCE INTELLECTUAL
let's just ignore the community reinvestment act and it's contribution to risk in the derivatives market to make it fit your nebulous point.
Friedman was right on all of the points in this video- and it applies to the housing market and financial collapse perfectly.
This video is 12 years old and all he says here is playing out today, probably in the USA and most certainly in Australia. We are heavily taxed on income, the more you earn, the more hours you work, the harder you work, the more you pay. If the welfare paid for child care in Australia was classed as welfare, which it is but it isn't classed as welfare, the total welfare payments would be enormous. A man works in in mining, away from home two or three weeks at a time, misses out on many important family occasions, earns good money on 12 hour days, often quite dangerous work, he pays enormous sums of taxes. He may have 2, 3, or 4 children but gets no child support because his income before tax is high. So he works his guts out to enable a two income family to receives big benefits (welfare) for strangers to look after their children. The taxation and welfare system stinks to high heaven.
He literally described Obamacare in the last minute.
I guess I'm still clueless to all those "cures for cancer."
There's still that little problem of tens of millions of people dying from the disease every year...
It is true that the percentage of GDP paid in taxes has remained fairly constant.
What is different is the progressivity of the income taxes system, where - despite tax breaks - wealthy individuals and corporations paid far more in taxes during the post war era than they do today.
@isaacasimov054 you could learn a lot from both spell check and Milton Friedman.
Milton Friedman is the ultimate badass!
I wasn't aware that empirical fact was "pure static". There are no "successes" of socialism to break down, but then no one ever went broke underestimating the intelligence of the electorate.
I forgot nothing. That a private entity would unquestionably be more efficient and successful than the government, it doesn't make the oil any less valuable.
And the poverty stats from those organizations are set at a factor of the living standard and are, again, not directly comparable.
Nope, I'm from Perth, Australia. And people who come to the US from Australia for heathcare only do so for treatments which are either 1) discredited by medical science, so the Australian health system does not provide them or 2) cosmetic or unnecessary procedures, because the government doesn't use taxpayer money for treatments which aren't related to health. Things like plastic surgery are much more expensive in Australia because the training standards for doctors and nurses are quite high.
If only he were born in 1922 instead, Friedman and Hitchens would do much to ease my mind and bring perspective to the events unfolding today. Instead I sit here and try to glean what information I can from a speech delivered when I was one year old.
@432ps1 Exactly. I don't have to be told or coerced into saving for my retirement. I, like most people, have the foresight to do it on my own, and I can do it far more efficiently.
If I fail? I accept the responsibility for my failures, and can then plan on working till I die.
"My way, or the highway, understood?"
The highway.
@NJpanther05
Canada has an economist as Prime Minister, and we have been outperforming the US ever since he was elected.
An observation made without anger, can take place now and then,
@abbadabbadolittle
From what I know of Chile it's leaders did make changes after Pinochet but they did maintain a market oriented economy in comparison to it's neighbors in Latin America. Chile from what I've read still has Latin America's best performing economy largely as the results of these market reforms that are rooted in Friedman's Chicago Boys.
the most prominent negative to mandated national social healthcare in the u.s., which I find is always overlooked, is the logistical impossibility of cost effective administraton of a program involving 311 million people. There are only 22 million people in Australia.
The basics are pretty easy to learn without instruction. Advanced Macro- and microeconomics and econometrics are where it gets tricky.
"The underlying economic system is irrelevant," is flatly wrong when compared to empirical data.
First off, tuition is only so high in price because Government programs insuring it for a lot of minority groups (People with single parents, Native American, first person in the family to go to college, etc.). Therefor the burden for that gets made up by the families who can't qualify and it hurts the middle class the most.
Most colleges used to be affordable with a part time job year round or a full time job in the summer. Maybe not major universities, but you could still save up if you wanted
It is really sad that he gave these speech's more than 30 years ago, but in that time nothing has changed or improved in any way. One has to wonder when we will finally meet and then pass the tipping point, or indeed, have we already done so?
Don't wanna pay Social Security? Let grandpa move in with you.
What I mean is market forces cause quality to up and prices to go down. That has been the course of history in any society that has any type of free product and/or capital markets.
If there was no risk to the lenders, why did every major bank need a bailout to stop them from going bankrupt? Because there was huge risk in the government-free derivatives market .
But let's just ignore what happened without governmnet interference in derivatives markets to make it fit Friedman's philosophy.
For what its worth, both of my parents were born prior to the Depression. And I was politically active in the 1980's and remember them quite well.
@katakisLives I understand helping those in need; I support such a cause. It is through the love and caring of others that we can find new love and care within ourselves. To paint this dystopia and tear it apart as if it were my argument does not make sense to me since you and I can both obviously agree we don't want a limited island of paradise for very few and obscene poverty for the masses. Care for others must come from a personal choice to do so; not a law that forces those to give.
On the contrary.... What happened to 2008 was in large part the decade of government telling banks they needed to be giving out more risky loans and mortgages which in turn didn't get paid for. I have another theory about 2008 as well, it's very close in relation to what happened on November 7th 2012 (The day after the election)
the free market are people.
You and me are part of the free market.
We don't use force like a government would.
Because once you use force in a free market it means it would not happen naturally and therefore a waste of resources.
it's easy to say social security should be gotten rid of, when u're in good shape and u don't need it. if you're in bad shape and you can't work, then you're not so eager to see social security disappear.
1. People are inifinitely wise on how to manipulate people all the way from infant formula to houses and cars. Justice systems would also have to infinately knowledged on how to inform consumers and execute laws to protect people. Justice systems would therfore be a form of government to a certain size which would require a tax to fund it for people's good. 2. How does the money supply increase? because people borrow it when they cave into market pressure to purchase something they don't need.
It also discourages private savings which could lead to generational wealth building.
Yes, it's nice that they've "improved," Fletch.
Of course, they HAVEN'T with regards to hunger and malnutrition, which according to the UN World Food Programme, has increased almost 10% since 2004.
Of course, as an "economist," I'm sure you TOTALLY study things that actually affect people's lives, not just the corporate profits.
that healthcare bit at the end u_u
It is almost exactly the opposite if you look at the data.
The sad drive to keep down costs of health care - like every other nation does. US private industry health insurance is the most expensive in the world, in spite of Friedman claiming the opposite would occur.
@FoolishDeamon Yeah, Friedman pushed vouchers as a stop gap to "get from here to there." The main issue happened after 1965, when the teacher's unions became binding. All declines can be traced back to that decision.
what about Congress "borrowing" money from social security?
Friedman's great talent was for understanding both the cultural despair and gullibility of his audience. Disseminating an ideology that flattered as it deceived, promising prosperity to wage earners even as he defended the upward redistribution of wealth that kept wages stagnant and permitted industrialists to accumulate the capital that enabled the transfer of American manufacturing jobs to the third world, resulting in the permanent deindustrialization of the US economy. One consequence of this development was the vast expansion of a predatory finance sector that preyed on insecurely employed and underpaid American workers who could no longer make ends meet. As the pied-piper of deregulation and tax breaks for big business Friedman, like fellow cult guru Reverend Jim Jones invited listeners to reject democracy, turn inward and in effect, commit political suicide together in the name of inverted visions of Utopia that would in both cases, end tragically.
lol
The genesis for off-shoring skilled jobs was much more the result of increased wages, not stagnated wages. Every economic class saw an increased standard of living (inflation adjusted) from the 60s through the millennium (though yes, the rich became richer-er.)
Less expensive labor from emerging countries made the de-industrialization of the US an inevitability for most types of manufacturing. Many US companies that didn't utilize labor from abroad lost out to global competitors who did (for example, our steel industry.)
Take a peek at the Fed's interest rate when this off-shoring of jobs really kicked in. There is a very cogent argument that Alan Greenspan intentionally initiated a housing boom to offset the negative effects of jobs going away. Magnify those lowered interest rates with political moves designed to get more people into houses (deregulation of loan process, bundling and other incentives for sub prime lending,) crooked mortgage brokers and home-buyers happy to lie on applications, and financial groups that could make a killing by buying and selling these bundles and voila-- mass loan defaults and our current recession.
Your post was very prosaic- even poetic- but I think its inaccurate.
The fictitious world your post refers to is already familiar. "Every economic class saw an increased standard of living,... from the 60's thru the millennium." You deftly construct society as a set defined by economic class. Economic class as a category apparently eliminates, 2.5 million prisoners, some +20 million unemployed, single mothers with dependent children, recent veterans, children living in poverty, the underemployed who work one or more jobs but without sufficient income to obtain basic necessities, students who have left school as they can no longer afford to remain enrolled, farmers in bankruptcy, Native Americans on reservations, black men under the age of 30 and so on. When you speak of class presuming to include everyone, the evidence I can see suggests your category "classes" includes almost no one. But you have a point. Once the resources of a society are reduced to merchandise and their private ownership legitimized, the public agenda collapses into competing private agendas answering to a minority with the means to buy political influence and often thru it hold a majority interest in the "economy". In this regard Friedman plays the classic capitalist utopian with a vision for an ideal society that demands the total elimination of democratic oversight of what he deems a free market with clear implications for any other institution that is not controlled by that market. Creative destruction spreads poverty and unemployment as it constructs the reality of concentrated economic power behind the appearance of growth and prosperity. .
gary morrison That's a whole lot of words to say you disagreed with the man. He spoke many times about the regressive nature of the FICA tax system and supported the concept of a negative tax rate for the lowest incomes to untax them. Just because he didn't support the convoluted govt bureaucracies that you seem convinced actually help the poor does not mean he was a corporatist. Think about it, does the convolution of our current tax code serve the best interest of the poor or the best interest of those who can afford to hire tax accountants and attorneys to find the loopholes?
oterj0 It must be comforting to believe that Friedman, patron saint of Laissez-Faire and apostle of inequality, is free to enjoy a moral exception, on the grounds that he once endorsed a government bureaucracy. I am sure the death squads of General Pinochet were chastened by Milton's rhetorical laps into big government interventionism.
Private property (and I'm talking about land, not goods) has existed going back 12,000 years, not 30,000.
Hayek himself understood that for tens of thousands of years, humans evolved in cooperative societies where goods and services were largely shared. This actually bothered him quite a bit, and he said that modern socialists were, in fact, a throwback to those days in early human evolution.
I'm sorry if that offends your attempt to re-write history,
@VandalayProductions That the government has decided to abandon everything that Friedman advocated and instead go on a decade long spending spree (that took our debt level from below that of Sweden to far above it) so that we could abandon the steady improvement relative to Sweden over the preceding decades hardly makes those who listen to Friedman look bad.
@fzqlcs Most economists, except a few conservative ones employed by such Koch-brother funded institutes as Heritage Foundation, advised that in this time of joblessness government funding to provide projects and jobs is in fact a wise investment. For each dollar spent, the return in recycled spending within the economy is a net gain. Europe rejected this principle taking the conservative austerity route you prefer and the results have been devastating, requiring far costlier bailouts.