Milton Friedman on Self-Interest and the Profit Motive 1of2
Sign in to YouTube
Sign in to YouTube
Sign in to YouTube
Uploaded on Dec 2, 2007
This clip is from the 15-part lecture series, "Milton Friedman Speaks"
Transcript available via FreedomChannel: http://freedomchannel.blogspot.com/20...
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".
Free to Choose - All 15 episodes streaming online for free
A history of Free to Choose
Standard YouTube License
- 6:55 Milton Friedman on Self-Interest and the Profit Motive 2of2by Sidewinder77128,916 views
- 8:43 Milton Friedman on Slavery and Colonizationby Sidewinder77294,627 views
- 9:38 Milton Friedman - Socialized Medicineby LibertyPen250,550 views
- 9:03 Milton Friedman - Health Care in a Free Marketby LibertyPen129,146 views
- 6:39 Milton Friedman - Socialism is Forceby LibertyPen151,137 views
- 13 videos Play all Built Ford Cheapby chevyguy1959
- 5:45 Responsibility to the Poorby brittle13336,914 views
- 9:56 Milton Friedman - The Robin Hood Mythby LibertyPen208,247 views
- 10:00 Milton Friedman - Lesson of the Pencilby LibertyPen99,101 views
- 7:12 Milton Friedman Crushes Man's 3 Questions like Dixie Cupsby FreeToChooseNetwork215,745 views
- 8:14 Milton Friedman - Collectivismby LibertyPen74,777 views
- 4:22 Milton Friedman - Redistribution of Wealthby LibertyPen314,916 views
- 10:00 Milton Friedman - The Robber Baron Mythby LibertyPen85,515 views
- 3:15 The 4 Ways to Spend Money by Milton Friedmanby Sidewinder77179,989 views
- 5:54 Milton Friedman - Incentives for Immoral Behaviorby LibertyPen81,732 views
- 9:56 Milton Friedman - The Social Security Mythby LibertyPen137,828 views
- 2:52 The Most Persistent Economic Fallacy of All Time!by brittle13262,127 views
- 6:57 Milton Friedman Puts A Young Michael Moore In His Placeby pplholdthepower29,396 views
- 5:28 Milton Friedman - Illegal Immigration - PT 1by LibertyPen97,094 views
- 9:44 Milton Friedman - Self-Interest & Self-Ownershipby LibertyPen14,803 views