Milton Friedman vs Ludwig von Mises

friedman believed in govt control of the money supply and the growth should be constant

mises belived that the money supply should be controlled by the market - thus grow and shrink with the economy

my source for my high level understanding is "the creature from jekyll island" by g. edward griffin. i can't give you a page # as i don't have the book in front of me.

Neither believed in fractional reserve banking

Mises wanted no government control of money, basically monetary anarchy

Friedman wanted a government-issued fiat currency where issuance was based on a computer-formula to increase the money supply as the economy grew, along with the free circulation of gold and silver

As with everything from the Austrian side, money is viewed as a creation of the market, a creation that the government overtakes.

On the Monetarist side, they start with the given that government prints money, start with central banking, ...

Monetarism was good but the VELOCITY of money being a constant was incorrect. Instead, the velocity of money is in constant flux, wild swings, and thus makes monetarist models all useless predictors of inflation.

The monetarist side is grounded in the "IS" side of science, that is it will not make normative judgments and keep itself testable, verifiable.

The Austrian side is not grounded in modern science and is an "OUGHT" based science, not testable, no predictions made in a scientific way through models, etc, and makes itself useless as predictors of inflation.

In my humble opinion, real science of neuropsychology, sociobiology, anthropology, will overtake the softer sciences and overtake economics and reformulate economics into a new cohesive whole. Steven Pinker in the Blank Slate shows the way, so too does libertarian economist Paul Rubin with his book Darwinian Politics. One of the more interesting books has been one that looked at our human nature of morals and how those morals effects economic choices...see: Moral Minds: How Nature Design Our Universal Sense of Right & Wrong, by Marc Hauser. My point here is that a NEW ECONOMICS, that is one fuller, more robust and filled with the good work from these sciences will for the first time ground Economics into a naturalist notion of Human Nature.

Which is all very funny. Once science catches up understanding Mankind as he is, it will suddenly fall behind as the Singularity is very near....http://singularity.com/ and Mankind finds (in our lifetimes) that just one computer is as smart as the smartest person, then in a quick leap forward and soon after, one computer will be as smart as the entire Human Race, then.....who knows...I for one fall into the belief that half or more of Mankind will choose ....CHOOSE FREELY ... to "borg" with "smart machines".

Like any other advance, we will do it in baby steps. We will "integrate" smart chips or computers into our bodies, even from a prenatal stage.
Who among you, once you lost your sight, would not accept a robotic eye? How many among you, when the doctor turns to you and asks "what eye color do you want for your baby?" would not answer "blue"?. That and many more choices means, the Human Race will be "Consciously Self Selecting Itself". In the highly underrated sci-fi thriller, http://www.youtube.com/watch?v=o7OYCmynrRU Ethan Hawke bucks the system...

In peace and liberty,
Treg

friedman was pro-gov. he was the only that proposed your income tax be withheld pay-check to pay-check as opposed to a lump sum at the end of the year to obfuscate the horror of the federal-income tax.

I think I have a decent grasp of the differences.

Chicago school uses empiricism and experimentation, Austrian school uses deductive logic. I side with Chicago on this one but I have a healthy dose of Austrian skepticism.

Chicago school is largely against the Gold standard(although Friedman came around to it at the end of his life), Austrians usually support the gold standard. I'm all with the Austrians here.

Mises actually admitted that there could be monopolies, as did Friedman, but Friedman near the end said that in fact they had never occurred outside of government intervention in history.

Both schools are mostly minarchist and make allowances for some limited government intervention. I like both Mises and Freidman's takes on these issues, but side more with the more radical Mises(Friedman invented the witholding tax and had a lot of decent but unnecessary compromises). Unfortunately, the Mises institute has almost nothing to do with Mises these days and is totally dominated by Rothbardian anarchists and politics rather than pure economics. On the other hand, the Cbicago school is basically keynesian today.

I think I have a decent grasp of the differences.

Chicago school uses empiricism and experimentation, Austrian school uses deductive logic. I side with Chicago on this one but I have a healthy dose of Austrian skepticism.

Chicago school is largely against the Gold standard(although Friedman came around to it at the end of his life), Austrians usually support the gold standard. I'm all with the Austrians here.

Mises actually admitted that there could be monopolies, as did Friedman, but Friedman near the end said that in fact they had never occurred outside of government intervention in history.

Both schools are mostly minarchist and make allowances for some limited government intervention. I like both Mises and Freidman's takes on these issues, but side more with the more radical Mises(Friedman invented the witholding tax and had a lot of decent but unnecessary compromises). Unfortunately, the Mises institute has almost nothing to do with Mises these days and is totally dominated by Rothbardian anarchists and politics rather than pure economics.

to interest rates.

Mises was for some gov't intervention in highways and military -- as is Ron Paul.

Rothbard-Rockwell (the current philosophy of the Mises Institute) is for zero intervention of any kind -- they are hardcore market-anarchists.

The latter supports Ron Paul because RPs model is 88-93% tax-free (nearly anarchist) on military and highways and 100% tax-free (intervention free) on currencies and all private markets.

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