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Milton Friedman on the Combination of Economic and Political Power

The Quote by Milton Friedman on the Combination of Economic and Political Power:

“The combination of economic and political power in the same hands is a sure recipe for tyranny.” -Milton Friedman on the Combination of Economic and Political Power

My Take on Combining Economic and Political Power

As you might expect, I think that this quote by Milton Friedman on the combination of economic and political power is spot-on; it perfectly summarizes why it is so dangerous for the rich to be in charge of politics, or, on the other hand, for politicians to be the wealthiest members of society. The reason why that is dangerous is that it leads to tyranny.

Historical Examples Prove the Veracity of Friedman’s Quotation

Historical examples of that abound. While most of ancient, classical, medieval, and colonial history is testament in proof to that, as you’ll understand if you read any histories of those eras, I’ll stick to more modern examples to show that Friedman’s quote holds true today.

Example 1: The Gilded Age

The first example is the Gilded Age. Although I think that some of the so-called robber barons, namely Vanderbilt, Carnegie, and JP Morgan, are unfairly castigated, it is true that during that era the richest Americans also had the most political power. Whether they had the money or political power first wasn’t particularly important; both types of people became immensely powerful and tyrannical, proving Friedman’s point about the danger of the combination of economic and political power.

On one hand was the Tammany Hall type of person described in The Republic for which It Stands, which is about the Gilded Age. That type of person used their political power to skim money off the budget and became fabulously wealthy through that avenue. Their power quickly became tyrannical as they used their wealth and power to turn cities into bastions of certain political parties.

the combination of economic and political power in the Gilded Age
The Gilded Age: The period when Americans first learned the dangers of combining economic and political power

On the other hand is the type of tycoon and trusts described in Nothing Like It in the World, which is a book about the transcontinental railroads. Those wealthy businessmen used their wealth to buy politicians off, turning some sectors of the American economy into a corporatist, rather than capitalist, ones. As with their kindred spirits in places like Tammany Hall, their power quickly became tyrannical; much the same is happening in India today because of its Gilded Age.

Throughout the Gilded Age, the “little people” were oppressed by a toxic cohort of corrupt and powerful politicians and corrupt, wealthy, and powerful businessmen. The history of that era in our history shows that not only are Big Government and corruption inseparable, but also that Milton Friedman was right. It is a recipe for tyranny if the combination of economic and political power is allowed to take root.

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Example 2: Mexico Under the PRI

A little known fact about the nation to our South is that, up until a few short decades ago, Mexico was a one-party state ruled by the PRI. Politicians and monopolists ruled the nation with an iron hand, oppressing average Mexicans and retarding the country’s growth.

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That happened because of the combination of economic and political power that Milton Friedman identified as a recipe for tyranny. Wealthy Mexicans bribed and paid off already wealthy government officials; while that slowed economic growth, it allowed them to remain prosperous. Average Mexicans, meanwhile, were forced to submit to the tyrannical whims of the state. Wealth and political power combined froze Mexico in an economic state much like America’s Gilded Age, but worse. That history proves Friedman’s point.

Example 3: Every Communist and Socialist Nation

But those two examples of tyranny resulting from the combination of economic and political power are tame compared to the examples that come from communist nations. The goal of communism is for the government to control the means of production. As a result, the people with the most economic and political power are the government officials, the ones who actually benefit from socialism.

Read The Gulag Archipelago, The Case Against Socialism, and Socialism Sucks. If you read those books, you’ll learn a lot about the true history of socialism. That history is a record of horrific tyrannies and crimes against humanity perpetrated by the government. Subjects were slaughtered en masse, huge swathes of the population were displaced or sent to prison camps, and liberty was non-existent.

What allowed those evils to happen? The combination of economic and political power. Bureaucrats, empowered by their ability to control every aspect of the lives of their subjects, crushed dissent by wielding their economic power and monopoly on violence. Dissenting workers were kicked out of their factory jobs (or other jobs) and not allowed to work again. Prominent political dissenters were locked up and tortured. Suspected enemies of the state were unable to work if the state didn’t just murder them outright. That is the history of socialism and the combination of economic and political power allowed under it; that combination is the road to serfdom.

Conclusion: The Combination of Economic and Political Power Must not be Allowed to Happen Here

If you want to know the antidote to the problem of the combination of economic and political power, read Capitalism and Freedom by Milton Friedman. Allowing free markets to thrive, rather than a socialist or corporatist system, does away with the potential for tyranny. The rich can’t become overly powerful because politicians can’t use their political power to grow wealthy.

Unfortunately, that isn’t really the case in America right now. Hugely wealthy tech CEOs are able to use their economic power to pressure or buy off politicians. So are CEOs from major industries, especially the oil, green energy, healthcare, and defense industries. While that power has not translated into tyranny yet, it could very well become tyrannical in the future.

We’re already seeing that in the tech space, where Congress’s lack of will to constrain the power of the tech industry means that the social media giants have influenced the election and are constraining free speech. Similarly, with the Biden Crime Family and the evidence about it in Hunter Biden’s emails, we’ve seen how politicians use their power to become immensely wealthy.

So, to limit the threat posed by the combination of economic and political power, we need to both limit the power of the government and limit its ability to be corrupt, as the recent oligarchic strike against populism has shown.

Big businesses will always try to buy favors from the government. That has been the case for a long time and won’t change anytime soon. But, if we always investigate and prosecute corruption, then the threat posed by it can be limited.

Similarly, what makes the combination of economic and political power dangerous is that the government has so many avenues of action and oppression in its toolkit. If we limit its ability to act and oppress us, then it doesn’t really matter if big business and wealthy individuals want to buy favors; those favors can’t really buy anything.

By: Gen Z Conservative

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