Friedman Debunked the Gospel of Keynes

With his wife, Rose, he wrote a regular column for Newsweek, churned out books in simple English and produced a television series for PBS. And over the years, he provided a steady stream of influential advice to politicians and policymakers, beginning with Barry Goldwater and Richard Nixon, and extending through Ronald Reagan, Margaret Thatcher and Alan Greenspan.

Friedman wasn't always right. His dogmatic monetarism clouded his economic predictions during the 1980s and '90s, in part because of globalization and new financial instruments that made it difficult to measure the money supply, let alone control it. And after the success of the Greenspan era at the Federal Reserve, Friedman was forced to acknowledge that maybe humans could do a better job managing monetary policy than the computer he once recommended.

Friedman's abiding distrust of government action also blinded him to its successes. But it would be wrong to confuse his libertarian instincts with lack of human sympathy. He was an early proponent of the negative income tax, now known as the earned income tax credit -- which supplements the wages of millions of low-income workers. And while he opposed rent control, public education and Social Security, he promoted government vouchers to help people buy housing, education and medical care.

Whether he was right or wrong, whether you agreed with him or not, it is certainly true, as Summers noted yesterday, that Friedman improved the quality of thinking in every debate he entered. The same might be said of his friend John Kenneth Galbraith, who was as energetic in defending the Keynesian view as Friedman was in discarding it -- and who also died this year.

Many of Friedman's ideas have become so fundamental to modern economic thinking, it's easy to forget how unconventional they once were. Federal Reserve Chairman Ben S. Bernanke put it nicely in 2003, at a conference organized by the Dallas Fed to celebrate Friedman's life and work.

"I am reminded," Bernanke said, "of the student first exposed to Shakespeare, who complained to the professor: 'I don't see what's so great about him. He was hardly original at all. All he did was string together a bunch of well-known quotations.'"

Steven Pearlstein can be reached atpearlsteins@washpost.com.