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Taxmageddon and Obamacare: What Would Milton Friedman Say?

Posted By Rich Tucker On July 31, 2012 @ 12:18 pm In Featured,First Principles,Obamacare | Comments Disabled

“I am in favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it’s possible,” economist Milton Friedman once said [1]. So the Nobel Prize winner would undoubtedly be concerned this year as Taxmageddon, [2] the one-year $494 billion tax increase that is poised to strike the economy in January approaches.

Friedman’s opposition to taxes was based on the idea that governments were inefficient in everything they did. “If you put the federal government in charge of the Sahara Desert, in five years there’d be a shortage of sand,” he quipped. By limiting government resources, he hoped to limit the size and scope of government [3].

Instead, the coming of Taxmageddon would make the federal government even more intrusive and influential. As such, it’s already slowing job creation, generating economic uncertainty, and reducing productive investment.

Friedman would also warn us about the dangers of Obamacare.

“The great achievements of civilization have not come from government bureaus,” he explained [4]. “There is no alternative way so far discovered at improving the lot of ordinary people that can hold a candle to the productive activities that are unleashed by a free enterprise system.”

Yet Obamacare takes our health care system in exactly the wrong direction. Instead of putting people in charge of their own health care decisions, “it imposes several costly new mandates and restrictions on health insurers and providers that will raise health care costs and therefore premiums.” [5] Further, “Obamacare raises taxes and adds 17 new taxes or penalties that will affect all Americans.” [6]

Friedman warned [7] that government involvement would lead to socialized medicine and that it would be “very much against the interests of patients, of physicians, and of other health care personnel.” Why? Because “you invariably get lower quality and a lower quantity of medical care.”

In one of his most famous quotes, Friedman pointed out [8] that “there’s no free lunch.” Every government “benefit” is paid for by somebody.

Friedman would have been 100 years old today [9]. His wise counsel is missed, but the lessons he taught apply just as much to today’s debates as they did during his lifetime.


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URL to article: http://blog.heritage.org/2012/07/31/taxmageddon-and-obamacare-what-would-milton-friedman-say/

URLs in this post:

[1] once said: http://townhall.com/columnists/johnhawkins/2011/11/29/10_of_the_best_economics_quotes_from_milton_friedman

[2] Taxmageddon,: http://www.heritage.org/research/reports/2012/07/top-5-reasons-taxmageddon-is-destroying-jobs

[3] size and scope of government: http://www.rightwingnews.com/interviews/friedman.php

[4] he explained: http://www.youtube.com/watch?v=RWsx1X8PV_A

[5] “it imposes several costly new mandates and restrictions on health insurers and providers that will raise health care costs and therefore premiums.”: http://www.heritage.org/research/reports/2010/09/obamacare-increases-health-insurance-premiums

[6] “Obamacare raises taxes and adds 17 new taxes or penalties that will affect all Americans.”: http://blog.heritage.org../../../../../wp-content/uploads/obamacaretaxes120702.jpg

[7] warned: http://www.youtube.com/watch?v=VPADFNKDhGM

[8] Friedman pointed out: http://www.youtube.com/watch?v=YmqoCHR14n8

[9] 100 years old today: http://www.heritage.org/research/reports/2012/07/commemorating-milton-friedmans-100th-birthday-with-the-index-of-economic-freedom

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