The Involvement in World War 2

“We have a system that increasingly taxes work and subsidizes nonwork ''. The United States Government collects income taxes and gives it Social Security for disability, retirement, spouse and government pensions offsets, trust funds, medicare, and others. This quote was from Milton Friedman as he expressed beliefs against a welfare structured state. Milton Friedman who often described himself as an agnostic, and was known to be a modern-day libertarian economist. From being born into a working-class family of Jewish immigrants in America to becoming a Nobel Peace Prize winner, and working for President Regan, Milton Friedman had to overcome many obstacles in his lifetime.

Milton Friedman was born on July 31, 1912. He was born in Brooklyn, New York in the United States. Right before he was born his family relocated to Rahway, New Jersey. While he attended Rahway High school he was a very successful student receiving a competitive scholarship to Rutgers University. He quickly graduated at the age of 15 from Rahway High School in 1928. His Parents Sára Ethel and Jen? Saul Friedman who were both Jewish immigrants from Beregszász in Carpathian Ruthenia, Kingdom of Hungary which is now Berehove, Ukraine. Both his mother and father worked at a dry goods merchant.

Milton Friedman had a very extensive and long history when it comes to school as he went through some sort of the education system all his life. Early in Milton Friedman's academic career, he was accepted into a position at the University of Wisconsin in Madison in 1940. Soon after this Friedman left the University of Wisconsin because he had different views of the involvement in World War 2. Friedman had very strong views regarding the war, Friedman strongly believed that the United States of America should fully be involved in the war and they should enter it immediately

“If a very large fraction of the young men of the relevant age groups are required–or will be used whether required or not–in the military services, the advantages of a volunteer army become very small. It would still be technically possible to have a volunteer army, and there would still be some advantages since it is doubtful that literally 100 percent of the potential candidates will, in fact, be drawn into the army; but if nearly everyone who is physically capable will serve anyway, there is little room for free choice, the avoidance of uncertainty, and so on. To rely on volunteers under such conditions would then require very high pay in the armed services, and very high burdens on those who do not serve, in order to attract a sufficient number into the armed forces. This would involve serious political and administrative problems. To put it differently, and in terms that will become fully clear to non-economists only later, it might turn out under these special circumstances that the implicit tax of forced service is less bad than the alternative taxes that would have to be used to finance a volunteer army.

Hence, for a major war, a strong case can be made for compulsory service. And indeed, compulsory service has been introduced in the United States only under such conditions–in the Civil War, World War I, and World War II. It is hardly conceivable that it could have been introduced afresh in, say, 1950 if a system of compulsory service had not so recently been in full swing. As it was, the easiest thing to do when military needs for manpower rose was to reactivate the recent wartime technique.” (Milton Friedman, 1967)

After Milton Friedman left the University of Wisconsin, he joined the division of War Research at Columbia University. This is where Friedman spent the rest of World War 2 in 1943, he worked as a mathematical statistician and was focusing on problems like weapon designs, certain military tactics as what would work best, and metallurgical experiments. While he was there he worked on a jet engine, Friedman's job was determining the best alloy that would have the greatest strength under high temperatures. He would often have to see how long it would take the blade to rupture at what given temperature. After this he wrote a book and published this book in 1945, this book was titled Incomes from Independent Professional Practice. This book went over five different types of professions. These were used as a case study, it studied the factors that determine the income that individuals receive for the work that they do. The book goes on to talk about incomes individuals receive and how the government regulates the resources by different uses, and how its distributed and measures the effectiveness in regulating the resources towards the citizens. The book continues to go on discussing if every individual was entirely allowed to choose their occupation the advantages and disadvantages, emphasizing the different types of occupations that would lead towards equality for people with similar abilities. After Friedman published his book in 1945, he continued his doctoral dissertation at Columbia University. The University then went on in 1946 to award him his Ph.D. After this Friedman spent the rest of 1945-1946 academic year teaching in Minnesota. Friedman taught in the fields of analyzing consumption, the history of monetary and theory. He also demonstrated the complexity of stabilization policy. Friedman saw that the rate of growth of the supply of money could be an important factor for a “boom and bust cycle”. He offered that the banks should stabilize the money rate of growth, and keep it at that number forever. During this time at the University of Minnesota his son, David Friedman was born. At the beginning of 1946, Friedman was offered a job at the University of Chicago. Friedman accepted this job at the University of Chicago and began teaching economic theory. This position was opened to him by his former professor Jacob Viner as he went to Princeton University. Friedman worked at this University for the next 30 years. While he was at this University he was able to teach a number of Nobel Prize Winners, as this was under the Chicago school of economics. The Chicago school of economics has around 28 winners out of 74 of the people who have won over the years. Soon after this the United States Government more specifically the National Bureau of Economic Research asked Milton Friedman to rejoin the National Bureau of Economics, after this he soon accepted the invitation, and he went on to take the role of the Bureau’s inquiry into the role of money and how it cycles in the business world. After this Friedman set out and made a workshop, called the “Chicago Workshop” or the “Workshop in Money and Banking” where its main goal was to start monetary studies once again. Farther in the 40s Friedman met Anna Schwartz who was an economic historian at the National Bureau of Economic Research. Anna Schwartz and Friedman later in the ’60s went on to publish a book titled “A Monetary History of the United States”. A Monetary History of the United States was and is still highly regarded by Economists. The book uses a historical timeline and analyzes the change in money supply and how it influenced the United States economy mainly towards economic fluctuations. They would go on to learn that the changes in the money supply would have unintended effects and that normal sound monetary policies would be necessary for economic stability. After this Friedman spent the next year of his academic year as a Fulbright where he would visit Gonville and Caius College, Cambridge. While Friedman was attending Cambridge in England the economic department was mostly in a Keynesian majority, and the rest of the individuals were anti-Keynesian. Friedman often thought that the reason he was invited into this organization is that he didn’t necessarily believe in Keynesian economics. Friedman himself often was quoted on separate occasions saying that “in one sense, we are all Keynesians now; in another one is a Keynesian any longer”. He would further elaborate on this saying that “We all use the Keynesian language and apparatus; none of us any longer accepts the initial Keynesian conclusions”.(Friedman, 1968) Although Friedman was the main advocate for opposing Keynesian government policies. He would suggest an alternative such as monetarism that he took under his wing, and argued that a steady and small expansion of the money supply was the best type of policy. This would allow the United States government to print the same low rate of money each year, rather than various amounts of money the next year.

The biggest event for Milton Friedman that impacted the individual that he would go onto be would be that Friedman was able to compete for a scholarship at Rutgers University. Because Friedman attended Rutgers University he specialized in mathematics and economics. Friedman was widely influenced by two different economic professors. These professors were named Arthur Burns and Homer Jones. Arthur Burns taught and did research at Columbia University, Rutgers University, and the National Bureau of Economic Research. Burns was the main individual who convinced Friedman that modern economics could end the Great Depression. The other professor Homer Jones also taught at the Rutgers University, The Brookings Institution, the University of Chicago, and the Federal Deposit Insurance Corporation. Jones was best known for being the research director at the Federal Reserve Bank of St. Louis. Friedman often credited Homer Jones for the reason he went on to become an economist.

Milton moved in 1935 to Washington DC. His job was to help assist with a consumer budget study with the Natural Resources Committee. The study at its core was to provide basic budget info for the Consumer Price Index. Two years later after this job Friedman was offered a job at the National Bureau of Economic Research in New York, he ended up taking this job. He joined Simon Kuznets for the studies of income and wealth distribution. This study was focused on the distribution of wealth for professional incomes. Friedman found that there were many barriers to entry jobs maintained by the American Medical Association. Because of this Friedman explained that this was the reason for much higher income levels of physicians relating to other comparable professions. This was the source of a lot of controversy when it was published by Friedman. Which led Friedman to believe in abolishing medical license. Friedman believed this would help “reduce and eliminate the monopoly power of the American Medical Association”. (Friedman Mayo Clinic speech, 1978) In the early years of World War 2, Friedman began working at the Department of the Treasury, more specifically in the Division of Tax Research, then soon later at the Statistical Research Group at Columbia University, where Friedman was a member of a group that used statistical analysis for war research. Friedman would then go on to teach at the University of Wisconsin and the University of Minnesota. In 1946, when Friedman's life truly came together, he accepted a position at the University of Chicago in the economics departmentn inspiration to many future and present economists, as well as everyday people for the work and studies/research he led and was apart of.

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