The Practical Milton Friedman

Monday, October 30, 2006
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We all feel the profound influence of Milton Friedman. That influence comes from his writing and research, from his teaching, from his work with his wife Rose on Free to Choose (as a book and a documentary TV series), and, of course, from his impact on people with whom he had contact, directly and indirectly. Some of those people were formally labeled “students” and some others were fellow faculty members. I fell in the latter group, but I really belonged in the former. Milton was a great teacher, and I found his ideas to be of tremendous applicability when I worked in government, particularly as secretary of the Treasury. So this story revolves around Milton’s argumentation for flexible exchange rates and his wonderfully helpful—and little known—suggestions for a plan to get there from the sense of crisis that emerged after the United States closed the gold window in August 1971.