Daily Literature of Revolution

• Via Cafehayek comes this link to Dierdre’s McCloskey’s review of Michael J. Sandel’s What Money Can’t Buy:  The Moral Limits of Markets.  McCloskey, like Sandel, is interested in the moral dimension of commercial society.  However, she presents a very different view of morality in our modern marketplace.  In a projected pentad, McCloskey will show that when it comes to the seven virtues, free market capitalism delivers the goods.  (She’s finished two; I’ve read the first one and it is impressive).  For an aperitif, her website contains links to shorter essays on the topic.  McCloskey’s apologia for the market is aretaic—meeting people like Sandel on his alleged home-turf.  For a utilitarian analysis, I’ve always enjoyed Richard Epstein’s essay “Libertarianism and Character.”  

• Meanwhile, London has some bad news for Cameroon, a country that has yet to embrace capitalism or individual rights.  Via Reason’s 24/7 Newsfeed:  7 Cameroonian athletes have fled the Olympic Village.  The BBC tentatively notes the most logical explanation—namely, that the competitors are determined to remain in the relatively greener pastures of Europe.  Last week, the New York Times had a short article on asylum-seeking athletes.  In the Olympic’s vainglorious haze, these stories of human desperation crop up fairly often.  At least one dash for freedom has led to political asylum.  I’ll try to stay updated on this story, including any compelling legal aspects.  

• If you are a state-sanctioned medical marijuana dispensary (MMD), the Feds may or may not arrest you, but they certainly will take your money.  Illegal income is taxable; this much is well-established law.  Last Thursday, though, the tax code became medical marijuana’s fully loaded lethal enemy.  Here’s the rub for dispensary owners:  section 280E maintains that a taxpayer may not deduct expenses incurred in the trafficking of controlled substances, including medical marijuana.  Applied literally and stringently, this could leave MMDs paying taxes on their entire gross income, an untenable proposition for most any business. Previously, in Californians Helping to Alleviate Medical Problems, Inc. v. Commissioner (CHAMPS), the Tax Court fashioned a reasonable compromise by separating a dispensary’s caregiving expenses (deductible) and it’s pot-selling expenses (non-deductible).  But with the Vapor Room’s case (Olive) last week, the Tax Court hath taken away (or severely limited) this minor solace.  Now MMDs must pass a high standard in showing that they maintain a second business (one that is not pot trafficking).  In Olive, the Court found that the Vapor Room was solely engaged in marijuana selling.  (p. 33, Olive).  In turn, the court declined to bifurcate the expenses, sticking the Vapor Room with all their operating costs.  (p. 39, Olive).  They can’t deduct wages, salaries, rent, payroll tax, repairs, security, utilities…nothing!  MMDs may still deduct the Cost of Goods Sold (yes, even their pot), but their sales record will be thoroughly scrutinized.  Reading through the Olive opinion, you get a sense that the Court regarded the Vapor Room as a lackadaisical outfit; whereas, in the CHAMPS case, the Court seemed impressed by the dispensary’s staid and conventional directors (note p. 20-1, CHAMPS).  Whether you’re on the left or right, this case should cast light on the Federal government’s incorrigible tentacles.  On a lighter note, the Tax Court does seem favorable to MMDs renting out extra space and offering yoga classes for its customers (p. 6, CHAMPS case).     

A New Segment: Daily Literature of Revolution

In order to induce more consistent blogging, I’ve planned this recurring section called Daily Literature of Revolution.  Shamelessly copying many other blogs, there will be a list of recent items from the news or the blogosphere.  I will then relate the primary item to its larger theme with links to books, academic scholarship, studies, court cases, white papers, etc.

The installment’s name comes from the first chapter of Bernard Bailyn’s The Ideological Origins of the American Revolution ("The Literature of the Revolution").  I'll now gratuitously quote Mr. Bailyn to explain why I'm using his words for my title.  First, of course, the wonderful John Adams epigraph:

What do we mean by the Revolution?  The war?  That was no part of the Revolution; it was only an effect and consequence of it.  The Revolution was in the minds of the people, and this was [effected], from 1760 to 1775, in the course of fifteen years before a drop of blood was shed at Lexington.  The records of thirteen legislatures, the pamphlets, newspapers in all the colonies, ought to be consulted during that period to ascertain the steps by which the public opinion was enlightened and informed concerning the authority of Parliament over the Colonies.

-John Adams to Jefferson, 1815

Describing the leaders of this thought revolution, Bailyn remarks:

They wrote easily and amply, and turned out…a rich literature of theory argument, opinion and polemic.  Every medium of written expression was put to use.  The newspaper…were crowded with columns of arguments and counter-arguments appearing as letters, official documents, extracts of speeches, and sermons.  Broadsides…appeared everywhere; they could be found posted or passing from hand to hand in the towns of every colony. (p. 1).

These were not literary masterpieces.  The colonists had their Thomas Paine’s, but most of the pamphleteers were “amateurish."  Nonetheless, they compensated for “practiced technique” with great passion and purpose.  

Above all else, the Revolutionary writers aimed for “the communication of understanding”.  (p. 19).  They responded to the political and social “disturbances of the 1760s” by taking to their pens and presses; there they “sought to apply advanced principles of society and politics to their own immediate problems.”  (p. 20).  Bailyn praises this pre-Declaration of Independence period as the most radical, creative, and foundational of the American Revolution. (p. 21).

Simply put, waves of people used every resource possible to produce their own jeremiads against tyranny.  Simply put, no monolithic group designed the recipe for 1776.  It was a bottom-up, well-reasoned, pluralistic analysis of society.  And it just so happened to lead more and more people to the cause of liberty.

The circumstances of 20^th century media made this type of pamphleteering unfeasible.  (see FN 3, p. 2).  Today, the single-minded orthodoxy is crumbling.  Bloggers, fact-checkers, and independent reporters stalk the Internet.  Moreover, academic literature is easily accessible outside the Ivory Towers.  You don’t have to be in D.C. to watch the Cato Institute or Brookings’ latest conference.  And so on.  

Today, conditions are ripe for another multifarious discussion of society.  Soul-searching with references and citations.  Let the chips fall where they may.      

Honoring and Resolving Milton Friedman's Legacy

In 7th grade, I had an unforeseen life changing moments.  Seated at the dinner table with my Mom, Dad, Sister, and closest extended family, my favorite family member (that is, until I met my wife) resolutely broke in, “I do believe you’re ready.  I’m giving you some books tomorrow.”

The next day, my beloved Grandmother showed up at my door proffering two tomes and a bit of advice.  “These authors set me on an intellectual path that has enriched my life.  I’ve always wanted to share these with you."  She said I would be rewarded with the consummate judgment contained therein.   She warned that this sort of stuff was uncommon, even neglected, especially in public school curriculum.  My Grandmother was a sharp woman.  I remember her for many reasons, but nothing reminds me more of her than these books.          

One was Ayn Rand’s Atlas Shrugged.  The other was Milton and Rose Friedman's Free to Choose.  I finished both of them, and dove into many other books of the libertarian oeuvre.  As a 13 year old, Rand’s brazen, never-compromise attitude—not to mention her staunch defense of individualism—was quite alluring.  Of course, every operative part of that sentence is an understatement.  Rand’s M.O. was to bulldoze the false edifice of collectivism with the brute force of her mind.  A bit of a scattershot, she left plenty of collateral demolition in her wake. 

Right off, I sought to emulate her style.  When a person hinted at some collectivist assumption, I would gladly dismantle their utterly defective world-view.  Suffice it to say, I chalk this up as one of my many  teenage shortcomings.  

A Kinder, Gentler Libertarian Ethos

As I finished high school, I acknowledged Mr. Friedman’s different tact—namely, he had it in spades.  He was magnanimous with those he disagreed and never lost his cool.  How does one foster these skills?  I believe this quote by Nick Gillespie reveals much about Mr. Friedman’s impeccable demeanor:  “Milton Friedman gave us something much better than revealed truth:  He showed us the process by which we might continue to indefinitely learn about our world and the human condition.”  This commitment to learning as a continual process requires respect for your fellow travelers regardless of where they stand.

Sometime after high school, I sensed that being cordial was of particular importance for libertarians.  Bryan Caplan affirms my intuition with an astute observation:  “All radical critiques of the status quo are fundamentally not humble.  After all, most people oppose major changes in the status quo.  So you can’t really advocate big changes unless you think, ‘I’m right and almost everybody else is wrong.’”  As Mr. Caplan notes, this means libertarians need “friendliness”, and he and I agree that Mr. Friedman exuded graciousness.  Call it graciousness under radical convictions.  

A Little on Friedman's Scholarship (and a necessary exegesis of one particular paper)

His technical achievements are remarkable.  To this libertarian mind, his first big achievement was lamentably in wartime tax policy, helping to create the withholding tax.[i]

But the yeoman work that must have gone into A Monetary History of the United States, 1867-1960 (co-authored with Anna Schwartz) is astounding.  The book is rewarding to both the educated novice and expert (this much I infer), assuming they have the corresponding 93 years to read about “the stock of money in the United States” through that pivotal time period.

Prominent libertarian economists have different takes on monetary policy, but it is puzzling to see a journalist (Mr. Wapshott) attempt to caste doubt on Mr. Friedman’s limited government bona fides.[ii]  In his article, Mr. Wapshott quotes from a Friedman essay (titled John Maynard Keynes) and then suggests that Mr. Friedman’s followers should be “rooting out corrupt officials” rather than “[railing] against the size of the state”. 

Yes, in big, bold type, we are told that Mr. Friedman believed that "where government was administered with integrity and honesty, governments have grown large without endangering the public good."  

How can this be so?  In fine classical liberal form, Mr. Friedman consistently advocated curtailing the size and scope of government.[iii]  Placing that elephant to one side, Mr. Wapshoot uses the following quote as evidence that Friedman believed better public officials are the key to an improved state: 

Britain retains an aristocratic structure, one in which noblesse oblige was more than a meaningless catchword.  Britain’s nineteenth-century laissez-faire policy produced a largely incorruptible civil service, with limited scope for action, but with great powers of decision within those limits.  It also produced a law-obedient citizenry that was responsive to the actions of the elected officials operating in turn under the influence of the civil service.[iv]

Without context, not much stewing there, right?  Earlier in the essay, Mr. Friedman states that, “Keynes was exceedingly effective in persuading a broad group…that all will be well if only good men are in power.”[v] 


This is the “moral authority” viewpoint.  It assumes government can solve anything with enough moral authority—Mr Wapshott holds this view, Lord Keynes held this view, the status quo of both left and right hold this view.  But it is clear, even from this very essay, that Mr. Friedman withheld his assent.  I believe it was Aristotle who said:  "It is the mark of an educated man to be able to entertain a thought without accepting it."  Mr. Wapshott sees attestation where there is only consideration.     


In the paragraph before Mr. Wapshott’s excerpt, Friedman makes clear that if an approach assumes that politicians will act in a morally benevolent fashion, it “is bound to contribute to an expansion in governmental intervention in the economy.”[vi]   We can agree that Mr. Friedman disliked such a tendency. 

Moreover, it is a well-trodden assumption that Britain’s nineteenth-century aristocracy maintained a certain moral vigor in administering public affairs.[vii]  However, Mr. Friedman did not imply that the “noblesse oblige” of the ruling class was sufficient for a well-administered state.  Rather, Mr. Friedman found that “Britain’s nineteenth-century laissez-faire policy produced a largely incorruptible civil service” and a properly functioning state.[viii]  [emphasis mine].  The limited government message is in plain sight.  

On top of that, in the sentence following Wapshott’s excerpt, Friedman asserts that “the welfare state of the twentieth century has almost completely eroded both elements of this heritage.”[ix] This is copacetic with Mr. Friedman’s oft-stated (and written) opinion that government expenditures are prone to miss their mark because “spending other people’s money on other people” is the least desired way to get something accomplished.

I agree with Mr. Wapshott that Friedman expresses some nuanced views in the essay, but they do not accord with the idea that better public officials are a sufficient (or even necessary) component of a better state.  Instead, this idea represents, as Friedman put it, Keynes’s “political bequest”.[x]  The essay's denouement makes clear Mr. Friedman's feelings on this subject: “I conclude that Keynes’s political bequest has done far more harm than his economic bequest”.[xi]  When it came to the state, Mr. Friedman wanted to scrap or rectify most parts of the system; he did not think the system could be fixed by better politicians.  

A Public Intellectual for the Ages

Mr. Friedman was a clear, convincing, and friendly diplomat for freedom and liberty.  He was able to take Mont Pelerin ideas and share them with the masses through his books and television series.  At least two generations of people have been inspired watching Mr. Friedman speak truth to power (his legacy is illustrated in a homey way by his son and grandson).  The movement for freedom is stronger—far, far stronger—because of his efforts and fortitude (and genes).

But he did not rest on inspirational speeches about what government could or should look like.  Where government exercised too much power, he assiduously carved out spaces for individual liberty and choice.


What does one do with a static behemoth of an educational system?  Milton Friedman pioneered the voucher system to induce a little competition and consumer/parental choice.  What about wars of choice with conscripted soldier-slaves?  Mr. Friedman did whatever he could to help end the draft and keep it at bay.[xii]  These accomplishments alone are enough to fill a few centuries, but his track record keeps going.

Milton has saved lives and let us live those lives more to our own liking.  What more could we ask of a public intellectual/economist?  Many others try to do the same and come up short.  Mr. Friedman’s secret was that he asked government for less (never letting his soft heart turn into a soft mind), and he maintained his inviting joie de vivre even when debating the most consequential of topics.  In an unforeseen side-effect, he taught me how to be a better person and a better advocate for freedom.  Happy birthday Milton!

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[i] Friedman has offered rationales and apologies for his gift to big government.  He has never been contradictory in his statements, though—always mentioning that he wished it no longer existed.   Nevertheless, the withholding tax spread to other countries and states, and appears to be with us for the long haul.

[ii] I concede that Mr. Wapshott takes the time to note the obvious: that Friedman often “trumpeted the virtues of free enterprise” and that he often debated Keynesian economists.    

[iii] What was Milton Friedman all about anyways?  Let’s go to the Friedmans directly (via the Master Resource blog):  “Our central theme in public advocacy has been the promotion of human freedom…[It underlies our opposition to rent control and general wage and price controls, our support for educational choice, privatizing radio and television controls, our support for educational choice, privatizing radio and television channels, an all-volunteer army, limitation of government spending, legalization of drugs, privatizing social security, free trade, and the deregulation of industry and private life to the fullest extent possible.”  (quote from Two Lucky People, Milton and Rose Friedman (1998), p. 588).  Every single one of these goals aims to either take away a government power or limit the scope of a government program. 

[iv] Quote appears in the third to last paragraph of Wapshott’s article, and p. 21 of Friedman’s John Maynard Keynes (JMK) essay.

[v] p. 20, JMK

[vi] p. 21, JMK

[vii] Deirdre McCloskey’s briefly describes this alleged phenomena in The Bourgeois Virtues: Ethics for an Age of Commerce:  “The English aristocracy defended itself in a democratic age as a service class, going to Eton the better to serve king and country.  Dedicated to loving England, and incidentally getting employment in politics and the empire.”  (Chapter 8, toward the beginning of the 2^nd section; Location 1824 in the Kindle eBook edition). 

[viii] This appears at p. 21, JMK.  It is also the middle sentence in Wapshott’s excerpt.  However, Mr. Wapshott ignores the fact that Mr. Friedman is indicating causation between “Britain’s laissez-faire policy” and the “largely incorruptible civil service”.  Many libertarians (and I’d include Milton Friedman in this group) believe that an increase in government’s economic power tends to increase the favors dished out by government (see this LearnLiberty video for a basic explanation). 

[ix] p. 21-2, JMK.  It isn’t 100% clear which two elements Friedman means here.  It could be a) the “aristocratic structure”, b) the “laissez-faire policy”, or c) the “incorruptible civil service”.  By my reading, he means b and c.  But even assuming it is a and c, this means that Mr. Friedman conceives that even an incorruptible, aristocratic civil service cannot withstand the emergence of a welfare state (i.e. bigger government). 

[x] p. 20, JMK.  In the second paragraph on p. 20, Milton Friedman signifies his attempt to synthesize “Keynes bequest to politics”.  At the bottom of the page, Friedman describes Keynes political bequest as twofold: one being the “public interest concept of government” and the second that “all will be well if only good men are in power.” [my emphasis.]  It is primarily this second concept that we are dealing with here.

[xi] p. 22, JMK.  Unless Mr. Wapshott sees something I do not, it appears that Mr. Friedman is very clearly distancing himself from the idea that a big government is benign so long as it is strive for more virtuous politicians. 

[xii] David Henderson relates Milton Friedman’s tireless and fruitful efforts to fight conscription in this article at Antiwar.com.  Perhaps the best story on this topic is related in the epigraph to the article.