50 Years of Blaming Milton Friedman. Here’s Another Idea.

By Binyamin Appelbaum, The New York Times

Liberals love to blame Milton Friedman for the misbehavior of American corporations.

Friedman, a free-market ideologue, published an essay 50 years ago this week in TheTimes Magazine in which he argued that corporations should not go beyond the letter of the law to combat discrimination or reduce pollution or maintain community institutions. Corporations, he said, have no social responsibilities except the sacred responsibility to make money.

The essay was a big hit with the executive class. Rich people were only too delighted to see selfishness portrayed as a principled stand. Friedman’s creed became the standard justification for corporate callousness. The Business Roundtable, a leading lobby for large companies, declared in 1997 that maximizing profit was the purpose of a corporation.

Critics have been fighting ever since to get corporations to acknowledge broader responsibilities.

It’s the wrong battle. Instead of redefining the role of the corporation, we need to redefine the role of the state.

Friedman’s essay was part of his broader campaign to revive faith in the power of markets. He and his intellectual allies argued that if corporations focused on making money, and government got out of the way, the economy would grow and everyone would benefit.

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