Thirty years ago, as the Carter presidency waned in the malaise-filled days of 1979, and the political world's axis shifted rapidly away from American economic and strategic strength, a young Phil Donahue attempted to agitate economist Milton Friedman in front of a live audience.
It's an interview that remains especially salient now, in an inaugural year of a presidency whose signal achievements include the forced acceptance of federal loans by private financial institutions and the writing of rules by bureaucrats limiting the incentives and awards available for individual enterprise.
Like today's political class in Washington proudly staging klieg-light inquisitions designed to score political points through the public chastisement of executives, Donahue appeared confident he could corner the free-market defender seated in front of him. "When you see around the globe the maldistribution of wealth, the desperate plight of millions of people in underdeveloped countries, when you see so few haves and so many have-nots, when you see the greed and the concentration of power S did you ever have a moment of doubt about capitalism?"
Oops. What Donahue evidently missed regarding the haves v. the have-nots is that, historically, it has been the haves -- monarchies, tyrannies, elites, bureaucracies, statists and central planners of all stripes -- who have had doubts about capitalism, not the other way around. That's why monarchies, tyrannies, elites, bureaucracies,
In prepping for the interview, it's possible Donahue momentarily lapsed and forgot who he was preparing to talk to -- one of the world's preeminent explainers of capitalism's attributes. As if placing an exclamation point on history, Milton Friedman only three years before -- on the 200th anniversary of the American Founding -- had won a Nobel Prize for his economic research and teaching.
Milton Friedman thus nicely positioned Donahue on the very hot seat the interviewer meant for his guest. "The great achievements of civilization have not come from government bureaus," Friedman instructed Donahue. "Einstein didn't construct his theory under order from a bureaucrat. Henry Ford didn't revolutionize the automobile industry that way. In the only cases in which the masses have escaped from the kind of grinding poverty that you're talking about -- the only cases in recorded history -- are where they have had capitalism and largely free trade.
"If you want to know where the masses are worst off, it's exactly in the kinds of societies that depart from that, so that the record of history is absolutely crystal clear: that there is no alternative way, so far discovered, of improving the lot of the ordinary people that can hold a candle to the productive activities that are unleashed by a free enterprise system."
Those words, and the informed conviction behind them, were exactly what American voters in the autumn of 2008 needed to hear, when the outcome of the presidential election was still up for grabs. Instead, the campaign on both sides was dominated by class warfare incitements stoked with incendiary rhetoric blaming "Wall Street greed" as the one-size-fits-all cause of the world's economic ills.
Donahue, as un-persuaded by Friedman's intellectual power and elegance and the force of his simple eloquence in 1979 as Obama and the Democratic-dominated Congress are in 2009, plodded forward, implying that dark clouds of greed and self-interest hold a unique influence over capitalism alone, as opposed to the supposedly benign political forces that seek to regulate it. Capitalism "seems to reward not virtue," Donahue challenged Friedman, "so much as ability to manipulate the system."
Friedman didn't skip a beat. "Is it really true that political self-interest is nobler somehow than economic self-interest? You know, I think you're taking a lot of things for granted. Just tell me where in the world you find these angels who are going to organize society for us."
The original American idea is fully based in trust, a trust that private initiative and private property working together can accomplish what is otherwise impossible -- the continued growth of economic opportunity and wellbeing for continually higher numbers of people. Government simply cannot organize society to economically outperform free, incentivized people.
Or as Friedman said to his urbane and self-impressed host: "I don't even trust you to do that."
Matt Kinnaman of Lee writes his column every week for the Transcript.
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