Nobel laureate, Milton Friedman, guiding force of global economic conservatism, more commonly identified as the 'Chicago School' of monetarism, passed away last night at age 94. His demise comes just six months after the passing away of his equally famous and influential contemporary and ideological rival, John Kenneth Galbraith.
An ardent protagonist of monetarism Friedman preached that money supply was the key factor in economic growth and inflation. His ideas of minimal government intervention, clashed with Galbraith's liberal views of government activism, gained popularity in the 1980s when they influenced the policies of political leaders and ideological peers such as Margaret Thatcher in the UK and Ronald Reagan in the US.
Born to Jewish immigrant parents on 31 July, 1912, in Brooklyn, New York, Friedman had to work to pay for his university education. Following his economics degree in 1932, he spent three years on a graduate scholarship at the University of Chicago.
After earning a doctorate from Columbia University in 1946, Friedman taught at the University of Chicago until 1976, the year he won the Nobel Prize for economics for his work in the field of consumption analysis. After his retirement in 1977, he became senior research fellow in the Hoover Institution at Stanford University in California.
Friedman was highly regarded as a key advocate of deregulation and privatisation. All through his three decades at the university of Chicago as professor of economics he advocated free market economics and deregulation, which resulted in his being crowned as the high priest of monetarism.
A leading exponent of the Chicago school, which held that money supply was the key determinant to economic growth and the rate of inflation, he argued that money supply should be kept strictly under control and also government spending, as excessive spending to curb unemployment fuels inflation. The source of inflation, he insisted, was the government.
The essence of his economic views that markets work best with minimal government interference, attracted fierce debate and criticism from welfare economists who favoured government intervention.
By the '80s his views on deregulation and free markets came to guide economic policy in many developing countries, especially in Latin America. However, a series of economic crises in the region in the 1990s led to an avalanche of criticism of the economic philosophy of the Chicago school, particularly with regard to privatisation.
Even Margaret Thatcher, who adopted many of his prescriptions when she first came to power in 1979, found it harder to control money supply.
Friedman's views influenced policy makers and government leaders often sought his counsel. He served as economics advisor during several presidential campaigns, including those of Senator Barry Goldwater's failed bid for the White House in 1964, and the successful campaigns by Richard Nixon in 1968 and Ronald Reagan in 1980, to both of whom Friedman was an advisor during their terms in office.
He authored or co authored around 20 books of which the best-known one, Monetary History of the United States 1867-1960. co authored with Anna Schwartz, was first published in 1963. Among his other well-known works are A Theory of the Consumption Function, Tyranny of the Status Quo and Free To Choose, co authored with his economist wife Rose in 1979.
However, his work was not just limited to economics. He was also a libertarian who campaigned for the decriminalisation of drugs and prostitution, and advocated the abolition of the military draft in the US after the Vietnam War, which he regarded as among his proudest achievements.
The Washington-based free market think tank, Cato Institute, to which Friedman was an advisor, in a statement to wire agency AFP, said, "If (John Maynard) Keynes dominated economic thinking in the mid-20th century, Friedman dominates economic thinking at the end of the century, and well into this century."