A student poses a series of question on based on Friedman's notion that people should pursue their own self-interest. The student points out that he'd read that Friedman had previously come out against disaster aid for victims of a flood in Pennsylvania. Friedman corrected the questioner and noted that he did not come out against private aid for flood victims but instead was against the Federal Government providing discounted flood insurance in advance to home purchasers which motivated people to build houses in areas where they otherwise would not have been able to obtain insurance privately. If not for the discounted insurance, it's likely many of the flooded houses would never have been built in the first place as it wouldn't have been in peoples self-interest.
The student went on to note that it was recently reported that an old man in Ohio died when the electric company turned off his power when he'd failed to pay his electric bill. Was it moral for the company to act in it's own self-interest to do so? Friedman responded by asking what if the electric company never turned off the power for anyone? Who would pay the cost--the people who own or work at the electric company? It would be unjust to impose that responsibility on individuals who are running an honest business of providing electricity. Friedman suggests that the true responsibility lies on the mans neighbors and friends who were not charitable enough to allow him to meet the electric bills.
Finally the student uses the example of Ford deciding not to install a $13 block of plastic which would prevent it's Pinto cars from exploding in a rear-end collision. Ford estimated such a move would cost 200 lives a year at a cost of $200,000 per life lost. They multiplied and found that it wasn't worth it to install the plastic block. He asked if a corporation seeking it's own self-interest was a good thing in this case? Friedman responded by asking, what if it cost $1 billion to save each life, should Ford have put in the block? It's simply not practical to put an infinite value on an individuals life. If it took $1 billion in resources to keep one individual safe, and acquiring those resources meant that a million people must starve, it's a bad deal. Friedman concludes that he doesn't know if the $200,000 number that Ford used was the right number to maximize the overall benefits, but at the end of the day the principle is that we can't simply protect ourselves from everything and impose that cost on others. Friedman posits that the question the student should be raising, is should Ford be required to attach the statement to the car, "we've made this car $13 cheaper, and therefore it is X% more risky for you to buy it".
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Why are "free market" and "capitalism" confused? There is a lot of economic activity that is parasitic. Like gambling, entertainment, porn, excessive speculation, etc.
Milton's point about it works best if everyone acts in their own interest is intriguing. Take the case of a shoal of Sardines or a flock of birds beings attacked by a predator(s). They all swirl around as if one united body evading capture. However, studies showed that actually each fish or bird was acting independently keeping the perfect distance from its fellow so it would not be caught RATHER than all helping each other not get caught. The fact they all got scoffed has never been explained..
not charitable means they do not want to loose money just like the company.what a sad philosophy of liberal democracy everything is cost related now that every one is in the shit let's wait for the invisible hand to come and feed your hungry mouths btw happy christmass
Luckily Ron Paul, the best american politician you possibly have, attacks this bullshit as well.And there are alternatives. Such a currency, that is backed with commodity, or / and amount of labour. (example.:Ithaca hour) Rusting money, with negative rate of interest as well.:Theory of Silvio Gesell (I know, its eccentric, and you are going to have a lot of questions, but read the Natural Economic Order, and the story of Wörgl..)
So true. And structural problems as well. 1.We have to separate the political system from the indivials economical self interest, just like Montesquieu separated the three branch of power. 2.Brand fucking new monetary system.Credit - money system sucks like bloody hell, and it's the main reason of social problems, darwinistic way of life, concentrated economical power, being rich whitout productive activity etc....
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On second thought, they should keep doing it so I have ample sources of humor.
everything is cost related now that every one is in the shit let's wait for the invisible hand to come and feed your hungry mouths btw happy christmass
Such a currency, that is backed with commodity, or / and amount of labour.
(example.:Ithaca hour)
Rusting money, with negative rate of interest as well.:Theory of Silvio Gesell
(I know, its eccentric, and you are going to have a lot of questions, but read the Natural Economic Order, and the story of Wörgl..)
And structural problems as well.
1.We have to separate the political system from the indivials economical self interest, just like Montesquieu separated the three branch of power.
2.Brand fucking new monetary system.Credit - money system sucks like bloody hell, and it's the main reason of social problems, darwinistic way of life, concentrated economical power, being rich whitout productive activity etc....