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If you like Milton Friedman's story, you might also like:
Gary Becker,
George H.W. Bush,
Paul H. Nitze,
John Sexton
and Lech Walesa

Milton Friedman's recommended reading: The Scarlet Plague

Related Links:
Hoover Institution

Milton and Rose D. Friedman Foundation

Nobel Prize

History of Economic Thought

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Milton Friedman
 
Milton Friedman
Profile of Milton Friedman Biography of Milton Friedman Interview with Milton Friedman Milton Friedman Photo Gallery

Milton Friedman Interview

Nobel Prize in Economics

January 31, 1991
Stanford, California

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  Milton Friedman

Let's start by delving a little bit into your early years. When did you first have a sense of what you wanted to do in your life?

Milton Friedman: It's hard to know. I don't think you ever have that sense.


When I went off to college, I knew I liked mathematics, and I was pretty good in mathematics. I was an ignorant boy in a small town, in a family that had never had anybody that had gone to college. I didn't know what you use mathematics for. The only thing that I could find out was that it was used in the insurance industry somehow. So I started to bone up on actuarial work, and I was going to become an actuary. Indeed, there is a thing called the actuarial fellows that you have to pass a series of examinations for in order to become a member. While I was an undergraduate, I took some of those examinations. They are about the hardest examinations in the world, as anybody will tell you, in mathematics, and I failed some and passed some. So that was my original intention. I just wanted to be able to make a living out of math.


But then, when I got into college, I got started getting involved in economics as well as mathematics. It was also a propitious time.


I started college in 1928. And by 1930, when I was a sophomore, the economy had started to go into a decline. By 1931 and '32 it was, of course, a precipitous decline. It became clear that an enormously important problem was what was going to happen to the economy. That seemed [to be] the most dominant thing. But yet, even when I was a senior, I wasn't sure what I was going to do. Partly because I didn't have any money, and I needed to get some help if I was going to go anywhere. As it happened, I applied for and received graduate scholarships. In those days, these weren't fellowships. All this paid for was tuition. And I received two: one from the University of Chicago in economics, and one from Brown University, in mathematics. So I had to make up my mind at that point whether I was going to go in the direction of mathematics or in the direction of economics. What made up my mind for me, of course, was the state of the world. In 1932, with that choice before you, economics seemed most clearly and obviously the most important place where a young man should put his energies.


You thought that was the most compelling public issue?

Milton Friedman Interview Photo
Milton Friedman: No question. No question. Here was this great paradox. Millions of people out of work, millions of people hungry, and you couldn't get the people that needed the goods and services together with the people who were in a position to produce it. When I faced up to that choice, I really didn't have any doubt. If I hadn't gotten a scholarship to Chicago, I would have had to go to Brown. I had worked my way through college. I had a tuition scholarship to Rutgers University when I was an undergraduate, but I earned all the rest of my expenses. Indeed, I graduated with a small kitty, but not enough to have paid even a year's tuition, let alone several years. So I had to go where I could get the help. Fortunately, I got a scholarship at Chicago thanks to one of my teachers at Rutgers, who had been a University of Chicago student and was close to some of the faculty people there.

What did your parents think when you first told them that you were interested in mathematics, or when you started to become interested in economics?

Milton Friedman: That's not as easy a question as you might think.


My father died when I was 13 years old. My mother was a very intelligent, able woman, but she was not an intellectual. My father was not an intellectual, neither one of them had ever gone... well, as a matter of fact, I doubt that either one of them had ever gone through anything beyond elementary. They knew how to read and write. But, they were in small private business. We had a small retail store at the time that my mother ran, that was the source of our livelihood, and also was the source of enormous aggravation, because you were always owing more money than you had funds to pay with. I would say that by today's standards, my parents in the whole of their life never had an income that came anywhere close to what we now regard as a poverty standard. But they did not regard themselves as poor. By no means whatsoever. And they weren't.


In my opinion, the poverty level is a very uncertain and meaningless standard, but if you measured it by that, they never in their whole lives had an income that came anywhere close to the poverty level. And yet...


They never regarded themselves as poor, because they were self-sufficient. They might be in difficult economic straits, we never had any great luxuries or anything, but we always had enough to eat. We always were clothed so that we were not a scandal, or a shame on the community. None of us would have said we were poor. We certainly were not rich. Many a night, early in my life, I heard my mother and father stay up at night worrying about where they would get the money to pay the bills the next day. From time to time they would have to borrow from friends or relatives or something to meet the tab. From time to time they would what's known as "kite checks". That is, write checks for the future, if they didn't have any money to pay on, but they expected to get the money by the time they came around. But at the same time, they were hard-working, independent people, who always made a living in the sense that I mention. But, they were not intellectuals in any way. And it wouldn't have occurred to them to comment on my interest in mathematics or economics, because that wouldn't have been meaningful to them. That was not their realm of discourse.


Remember, I was a first-generation American. I think you will find this same experience in many families. I know it's the same experience my wife and her family, her peers had. Their parents were enormously anxious for them to be educated and schooled. There is no doubt about that. My parents, insofar as they could, would have sacrificed anything to make it possible for me to go to college. My family had one great piece of good fortune during the Depression: my older sister, who worked for Western Union, the telegraph company. She was employed throughout the Depression. She was unmarried and lived at home, with the family, so they had a steady source of income. I was able to earn my own way throughout college, and as I say ended up with a little kitty. The only year I was really in trouble was my first year of graduate study at Chicago. Fortunately, I borrowed money from my mother and my sister that I was later able to repay. A hundred dollars or something like that, not a great amount.

My wife's brother, who became a very important economist, Aaron Director, was himself an immigrant to this country. One of these remarkable stories, like Arthur Burns. Arthur Burns came over to the United States at the age of 12, I think, from Austria, not speaking a word of English of course. By the time he was 23, he had gone through elementary school, high school, graduated from college, and was a member of Phi Beta Kappa, and so on. The same thing with my brother-in-law, Aaron. He came at about the age of twelve, not speaking a word of English, and in ten years, he was a graduate of Yale. His mother would occasionally send him five or ten dollars, because that's all she could scrape up, but the rest of it he had to earn on his own. And so did I.


This idea that's present now, that somehow or other it is necessary to have great government subsidies to enable people to go to college is not true. At no time, and our own experience show it, has it been impossible for people who had the requisite desire and ambition, who are willing to work hard -- at no time was it impossible for them to get through college. Scholarships for tuition, for paying the cost, those all are very helpful and I think are very desirable. But, I think our present arrangements under which we subsidize -- so extensively -- people on an across-the-board basis, without a question of merit or anything or a need, are very undesirable.


Anyway, that's a separate question. But to go back to your question, people like me were of a new generation, and we were in a different world. It wasn't our parents' world. The world they had grown up in had been an altogether different world. So if I had said to my mother, "I'm going to be interested in mathematics," she would have said "What's that?" Let me emphasize, it was not because they were uninterested, or unwilling to make sacrifices. Not because they didn't value intellectual activities very highly, but because they were not sophisticated.

But they were willing to support you in what you wanted to do?

Milton Friedman: Yes, whatever you wanted to do. Because they trusted your judgment in those areas far more than they did their own.

What about your interests as a young person. Were you a big reader?

Milton Friedman: Of course. I read everything. I grew up in a small town, Rahway, New Jersey. I had a small library, the Rahway public library, and I exhausted whatever they had on their shelves. I read through the Rahway library from beginning to end.

Was there one author or subject matter that just grabbed you?

Milton Friedman: No, I can't say there was. Very early I got interested in mathematics, and I've always had a strong interest in mathematics. But beyond that, when I was growing up I read novels all over the place. Mostly fiction. That's what I think young people, between six and 16, are inclined to read mostly. I read all kinds of fiction. There were quite a number of things that caught my attention. What really impressed me was a series of books by a western writer who wrote The Call of the Wild, Jack London.


Jack London wrote a marvelous book called The Scarlet Plague, which I must say for some reason is the one book I remember best out of that period. The Scarlet Plague is a novel, and it has to do with an illness, the scarlet plague, that comes to the country. People die out all over the world, all over the United States, except for small isolated colonies that are left. Advanced civilization collapses, the buildings in New York are empty, and so on. Here is a boy who is suddenly growing up -- in the wilderness of California as it happens -- and he stumbles over a railroad track, which has by now been almost buried in the dirt. He asks his grandfather or his father about that, and then you hear the story about this plague that wiped out mankind, and how in isolated places they are gradually coming back. I don't know why that one stuck in my mind so much, but it did.


Perhaps it came back to you during the Depression, when things seemed so bleak.

Milton Friedman: I think that's very likely the case. At the time I read it, it would have been in the '20s, when there was not that kind of thing going on. I also read all of the Rover Boys books, and all the other books of the time. I read almost anything that I could get my hands on.

Was it just a natural curiosity, or was there something that had to do with stimulating your imagination?

Milton Friedman: At this stage I couldn't answer that question. All I know is, I enjoyed reading.

What experience or event inspired you most as a young man?

Milton Friedman: That's a very hard thing to say, especially when you say "inspired." If you ask what events I can look back on as defining events, there were several of them. One of them was an early conflict over religious beliefs. Internally, not externally.


My parents were Orthodox Jews, but they weren't fanatic about it. They observed the dietary laws and so on, but there was nothing fanatical about it. They weren't, but I was. In my early years, I was fanatic about it. If this was right, this was the religion, you should do what you had to do, and so I was scrupulous, at about the age of 11 or 12, maybe 13. Not quite 13, I guess. Ten, 11 or 12. I was an enormously observant Jew. I remember once going on a joint Boy Scout trip, a trip with a number of Boy Scout troops, in which they were going to have hot dogs for lunch. They were not Kosher hot dogs, so I ran away, because I didn't have the courage to stand up and say I wasn't going to eat them. That was a defect in my character, and I simply ran away. But then, somehow or another, and I don't know where, I began to question it. When I finally decided that there was no fundamental basis for it, that all of this was mostly myths and prejudice, then I went the other way. My wife will tell you that I became fanatically anti-religious.


So that was one set of defining events, which certainly had a very great impact on me. There was a very different set at another time, that I can tell you very quickly.


I had a teacher in high school who was really somehow -- I think he taught government or political science, something like that, whatever you call it in high school -- but he also taught Euclidian geometry, plane geometry, simply because he liked it as such a beautiful, intellectual discipline. And I took his course, and one point or another, he got rhapsodizing about the beauty of geometry, and he quoted the last lines of Keats's "Ode on a Grecian Urn." "Truth is beauty, beauty is truth. That is all you know, and all you need to know." And those two lines stuck with me. I was about, probably 12 or 13 at the time. And they have stuck with me ever since, because they so much reflected the sort of feeling I had about the geometry, as well, and about mathematics in general, that its appeal is one of beauty, kind of an intellectual purity and beauty. And now, I'm sure that was what drove me into the direction of thinking I wanted to make mathematics my lifetime work.

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