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University's Plans for Milton Friedman Institute Spark Outcry

By Kari Lydersen
Washington Post Staff Writer
Thursday, August 28, 2008

CHICAGO, Aug. 27 -- Plans by the University of Chicago to establish a research institute named after legendary free-market economist Milton Friedman have caused an uproar at the school on the city's South Side.

More than 100 tenured faculty members have signed letters and a petition opposing the institute, which would be paid for by private donations and would conduct research in economics, medicine, public policy and law. Critics say that they are concerned the institute will be a partisan, elitist organization and that it shouldn't be under the auspices of a university.

"There are a lot of aspects that look like a right-wing think tank. I'm very worried about that possibility," said Bruce Lincoln, a professor of the history of religions who helped draft the letters and petition. "People are concerned about the blurring of the line between Friedman's technical work in economics and his fairly well-known persona as a political advocate of a very pure, free-market conservative or neoliberal position, where the market is the solution to everything."

The institute was launched this summer with about half a million dollars in university seed money and is seeking $200 million in private donations of $1 million or more.

The opponents' petition voices concerns that wealthy donors would have inordinate influence over the institute's research. The petition also said that Friedman-esque positions, such as privatization of Social Security, would be foregone conclusions, and that the state and nongovernmental organizations would be regarded with "distinct suspicion."

University Provost Thomas Rosenbaum said such fears are unfounded.

"Donors will receive reports and attend lectures, but they won't belong to the institute," he said. "They will have nothing to do with its direction, and no economist worth their salt would take that kind of direction anyway. We will bring in people from all over the world with all different approaches."

The institute was proposed by the economics faculty last year and approved by various faculty committees, Rosenbaum said. But, in June, faculty members from a variety of disciplines sent a letter to the university asking for a meeting. After a summer meeting with the university's president, Robert J. Zimmer, which Lincoln described as "unsatisfactory," they demanded that the issue be aired in a meeting of the faculty senate.

Zimmer agreed to convene the senate in the fall, for the first time since 1998. Rosenbaum said the senate meeting won't necessarily result in concrete changes to the institute but will involve "talking more broadly about the intellectual portfolio of the university." The senate is made up of all faculty members.

In some ways, the fight over the institute is fitting. Friedman, a longtime professor at the university's economics department who was awarded a Nobel Prize in 1976 and died in 2006, was always a lightning rod. His laissez-faire philosophy prompted him to describe as unjustified such government actions as rent controls, Social Security, minimum-wage laws and the military draft.

Critics say Friedman's theories, championed by conservative and libertarian politicians, caused increasing polarization of wealth worldwide. His detractors also faulted him for participating in authoritarian impositions of these policies, including in Chile during the Pinochet dictatorship.

Although the "Chicago School" is best known for Friedman's free-market policies, the university's Web site says it also should be seen as home of ideas such as "the economic theory of socialism," "general equilibrium models of foreign trade," "the economics of the household" and "the rationality of peasants in poor countries."

Twenty-five faculty members, researchers and alumni from the university have won the Nobel Prize in economics, many of them taught by Friedman. Three Nobel winners, Gary S. Becker, Robert E. Lucas Jr. and James J. Heckman, sit on the seven-member committee overseeing the institute.

Becker, an economics professor in the Graduate School of Business, said the institute is a way the university can "compete much more effectively against Princeton, Harvard and Stanford -- schools much better endowed than we are."

But critics see the institute as a disproportionate investment in one academic area.

Theology professor William Schweiker said that he has no problem with the economics department creating a research institute honoring Friedman, but that such large-scale investment by the university could be better utilized by spreading it among a range of disciplines.

"It's clear that not only economic forces are important in our time, but also cultural forces," he said. "The religions, for example, are exerting massive forces of good and ill around the world. We need to study them."

Becker, a former student and close friend of Friedman's, said that if the economist were alive, he would be proud of the institute and would take the controversy in stride.

"No one likes to be accused of things, but he was very single-mindedly devoted to doing the best he could to get at the truth," Becker said. "He could take controversy; he was tough."

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