I regard the basic human value that underlies my own beliefs as tolerance, based on humility. I have no right to coerce someone else, because I cannot be sure that I am right and he is wrong….no simple (practical) principle is really adequate. We do not have all the answers, and there is no simple formula that will give us all the answers. That's why humility, tolerance, is so basic, so fundamental. Milton Friedman (1990) "Say "NO" to intolerance"" Liberty, July 1991,Volume 4(6): 17.) [HT: David M. Levy]
That philosophy [Von Mises's praxeology—ES] converts an asserted body of substantive conclusions into a religion. They do not constitute a set of scientific propositions that you can argue about in terms of empirical evidence. Suppose two people who share von Mises's praxeological view come to contradictory conclusions about anything. How can they reconcile their difference? The only way they can do so is by a purely logical argument. One has to say to the other, "You made a mistake in reasoning." And the other has to say, "No you made a mistake in reasoning." Suppose neither believes he has made a mistake in reasoning. There's only one thing left to do: fight. Karl Popper…takes a different approach. If we disagree, we can say to one another, "You tell me what fact, if any, they [sic] were observed, you would regard as sufficient to contradict your view." And vice versa. Then we can go out and see which, if either, conclusion, the evidence contradicts. The virtue of this modern scientific approach, as proposed by Popper, is that it provides a way in which, at least in principle, we can resolve disagreements without a conflict." (Friedman, 18)
Let me take a real example. How many times have you heard someone say that the answer to a problem is that you simply have to make it private property. But is private property such an obvious notion? Does it come out of the soul?...So simply saying "private property" is a mantra, not an answer. Simply saying "use the market" is not an answer." (18-9)
The passages quoted from Milton Friedman are from a short speech delivered to a Libertarian audience in which he criticizes Von Mises and Ayn Rand on a number of issues calling them "both extremely intolerant." (18) While he mentions their personal intolerance, he is especially keen to emphasize their methodological intolerance. (Unsurprisingly, his analysis has been met with considerable irritation; see here and here for more online responses.) Here I focus on what these passages reveal about Friedman's commitments. I focus on four issues.
First, when faced with the transition problem, that is, how to move from – let's stipulate -- a misguided status quo to a just outcome, Friedman does not embrace what has become known as 'shock-therapy' in a general sense. He rejects it for moral and economic (or technocratic) reasons. Rather, he prefers (a) non-violent, (b) technocratic solutions (he mentions two of his signature examples: school vouchers and negative income tax) or mechanisms that (i) leave most background institutions intact, and (ii) produce – again let's stipulate – imperfect albeit more just and efficient outcomes and (iii) that are defeasible policy-interventions in light of further "experience." I would argue that (i) and (iii) are deviations from shock therapy. But the deviation is not total because his stance is compatible with gradualist and non-gradualist approaches. Sometimes Friedman is willing to advocate non-gradualist approaches; the most famous case is Chile, of course. But (in addition to military rule and other political turmoil), Chile was suffering from hyperinflation, and so Friedman's monetary shock therapy was a response to a clear economic challenge not a template for all policy.
I noted that his argument for his approach to the transition problem is, in part, moral because of Friedman's emphasis on "the responsibilities that we have." This ('we') is a theorist's responsibility for it covers those that advocate/theorize about a just social outcome (or "utopia"). He writes:
You can simply describe the utopian solution, and leave it to somebody else how we get from here to there. That's not only a practical problem. It's a problem of the responsibilities that we have….You have to have some mechanism of going from here to there….We may very well agree on the direction we want to go in, but just how we're going to go there and how far we're going to go, that's a much more difficult problem. (19)
So, it is misleading to think that Friedman always advocated shock therapy and argued to let the market simply take care of itself.
Second, Friedman understands (Popperian) science as a conflict-resolution-mechanism. Strikingly, for Friedman it seems that all major conflicts are generated not by disagreement over values (as one might expect), but rather over different factual interpretations. It's this commitment that opens the door to Friedman's technocratic conception of politics (recall and here, here) He assumes that all issues worth disagreeing about can be translated into an empirical question. In context, one of his targets, Von Mises, had insisted that central parts of economics were a priori. Friedman essentially denies that any substantive part of economics can really remain a priori. As I have explained, elsewhere Friedman allows that some of the mathematical parts of economic theory are not empirical, but he treats them as lacking substance. (To the best of my knowledge he never mentions Quine's criticism of analyticity.)
Of course, critics of Friedman have pointed out that "not all issues are empirical." Friedman does not simply overlook the normative entirely. For, third, Friedman's embrace of epistemic humility is a consequence of skepticism about the possibility of knowing a practical principle. I doubt Friedman means exactly what Kant meant by a 'practical principle,' but I think what Friedman is trying to claim is reasonably clear. Friedman's tolerance, which he understands as not imposing one's morality on another by force, is not a consequence of his embrace of value pluralism, but rather a consequence of his recognizing that folk will differ about the relevant means of implementing the demands of morality (the content of which he assumes people are in basic agreement over). These means are not just instrumental rationality (of the sort that economists are experts in), but also the ways in which moral maxims are concretely understood and interpreted in different local decision contexts. This is pretty clear from his treatment of some moral thought experiments he discusses in his lecture. (His analysis of these thought experiments is not fully developed, and it is not obvious his conclusions from them can survive extensive scrutiny.)
Finally, Friedman allows markets and science to be conflict resolution mechanisms. But he seems to think that if these cannot do their work, there are few other options to avoid 'fight'. In particular, he does not quite confront the fact that modern liberal democracies have all kinds of (let's call them) conflict postponement mechanisms that do not really settle anything, let alone conflicts, forever, but have (for all their obvious imperfections) a reasonable track-record in systematically postponing civil war in virtue, perhaps, of merely keeping discussions going. Despite what many critics believe Friedman was no enemy of democracy (nor the state: the lecture closes with him quoting Mises approvingly that government is the "most necessary and beneficial institution"); even so he also underestimated democracy's resources. I suspect it is common enough fallacy, even among democracy's purported friends.
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