|Milton Friedman in 1977, a year after he won the Nobel Prize in economic sciences|
Economists rarely shape policy to the extent that Milton Friedman did.
He died on November sixteenth in San Francisco, California, at the age of ninety-four.
Milton Friedman is best known for his work on the idea that governments can slow inflation by shrinking the money supply. He expanded on this theory, known as monetarism, by studying years of American monetary policy.
He argued against the advice of John Maynard Keynes. The British economist was a major influence from the nineteen thirties to the sixties. His answer to recession and high unemployment was government spending on public works, and printing more money to pay for it.
This increase in the money supply fed inflation. But policymakers at that time generally accepted that job growth meant high inflation rates.
Milton Friedman showed that inflation hurt job growth. He argued that governments should control the money supply to keep prices from rising, or falling, too much. But he thought they should not intervene in markets or job creation.
His ideas in the nineteen fifties and sixties were not popular at the time. But in the early seventies the United States had both high inflation and high unemployment. Policymakers started to listen. He won a Nobel Prize in economics in nineteen seventy-six.
His advice to cut taxes and control inflation influenced the policies of President Ronald Reagan and British Prime Minister Margaret Thatcher. He brought his ideas to the public by writing for magazines like Newsweek and appearing on television.
But some critics blame his strong support of tax cuts for increased budget deficits in the United States. And he was criticized for dealing with the military government of Chilean dictator Augusto Pinochet. That government overthrew a democratically elected president in nineteen seventy-three. But, as Milton Friedman noted, it was also willing to make economic reforms.
Today, changes in financial markets have made it much harder to control money supplies the way he advised. But his belief in small government and free markets is still popular with economic conservatives and libertarians.
He believed deeply in individual choice. Last year, he told public television's Charlie Rose that he wanted to be remembered as someone who helped increase human freedom.
Survivors include his wife, Rose, an economist with whom he wrote many of his books.
And that's the VOA Special English Economics Report, written by Mario Ritter. I'm Bob Doughty.