Notes on Freedom: Part 3

We met on Monday 21st January to continue our discussion of Economic Freedom, with a speech from Milton Friedman and the second part of Adam Curtis’ The Trap.


  • A definition of Keynesianism, which represented a shift towards government responsibility for the economy.
  • How this theory was tried during the stagflation and oil crises of the 70s. High and rising unemployment combined with high and rising inflation, which Keynesian theory said should have been treated by both expansionary (anti-recession) and contractionary (anti-inflation) measures at once.
  • How this apparent failure of Keynesian thinking) led to the ascent of economists like Friedman, who argued that past a certain point, increasing the money supply would only increase inflation.
  • Friedman’s natural rate hypothesis which states that employment (and possibly growth) is determined by factors outside of the control of the government.
  • How monetarism relates to liberalism (Friedman is both). Some felt that these are inextricably entwined, others that they were relatively independent.
  • The surprising fact that Friedman supported a negative income tax.

From here we discussed bubbles, Bitcoin, and the housing market. There was a debate over whether net migration to London, assuming it is occurring, should indicate that housing prices could still increase. On the other hand it was argued that London’s population has not drastically changed over the past decade, or not in a way commensurate with the rise in housing prices. It’s quite difficult to find figures for either of these arguments, though there are some ending 2015 here which seem to suggest net international immigration, but domestic emigration. (Please comment if you have better figures!)

We also covered the 2008 crisis, and the question of why banks’ capital requirements were not increased more than they were, when there was an opportunity to do so, and whether raising them now would cause them not to lend to consumers or to businesses.

There was a brief discussion of the extent to which people could assess their own usefulness to the economy, in response to David Graeber’s article and book on “bullshit jobs”.


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