Tape 37 - Monetary Developments, Economic Development, Cost of Anti-Inflation, Production / Property Taxes

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Moderator	Hello, this is instructional dynamics	0:02
	inviting you to another of our bi-weekly interviews	0:05
	with Dr. Milton Friedman, professor of economics	0:07
	at the University of Chicago.	0:10
	Professor Friedman,	0:13
	what are the recent monetary developments?	0:14
Friedman	There is nothing very striking to report.	0:18
	Figures on the quantity of money for the past few years,	0:22
	few weeks, at home in years, for the past few weeks	0:26
	have been going up and down	0:30
	and been fairly erratic.	0:33
	As yet in the figures there are no clear signs	0:36
	of a change in the over restrictionary	0:40
	monetary policy that has been followed	0:45
	for the past four or five months.	0:47
	I indicated in my last tape	0:50
	that I thought there were some signs	0:52
	that the reserve system was getting ready to move	0:55
	and was getting ready to ease up somewhat	0:58
	on that unduly restrictive policy.	1:01
	As I said the statistical figures are ambiguous,	1:04
	they do not show a clear sign,	1:07
	and yet they are not altogether inconsistent with that.	1:09
	While the numbers have been erratic for the past few weeks	1:12
	going up and down, yet they have shown some strength,	1:16
	somewhat rapid rate of expansion,	1:23
	whereas the quantity of money narrowly interpreted	1:26
	had been essentially stable for five months.	1:30
	The latest figure at roughly $200 billion	1:33
	is higher than any figure for quite a number of months back.	1:37
	The fingers are not inconsistent with a turn	1:42
	in monetary policy and I would remain of the same opinion	1:44
	as I was last time, that it is not unlikely	1:49
	that you are at the verge of a turn in monetary policy.	1:52
	Whether that turn will be large enough	1:57
	or sizeable enough remains to be seen.	1:59
	But it is at least a hopeful sign that there is	2:02
	some evidence of a turn.	2:06
Moderator	Do you have any comments	2:08
	on economic developments?	2:10
Friedman	Clear economic developments have been going	2:11
	pretty much according to schedule as one would expect	2:14
	from past episodes of this kind.	2:16
	The indicators that come out week by week, month by month,	2:20
	are of course mixed.	2:24
	Recently, we had a couple that seemed to show	2:25
	an expansionary policy, particularly	2:28
	the not expansionary policy and expansionary	2:30
	behavior of the economy.	2:34
	In particular, the series of leading indicators	2:36
	went up whereas the month before it had gone down.	2:41
	This is a very erratic series however, and I think	2:45
	it would be a mistake to put too much emphasis on it.	2:47
	Viewing the economic indicators as a whole,	2:50
	the general story they tell is have a distinct,	2:54
	slowing down in the face of economic activity	2:57
	of a distinct easing off in the inflationary pressures,	3:02
	an easing off that this year has made negligible impact	3:06
	on the actual rate of price rise,	3:10
	but in my opinion unquestionably will begin to do so	3:13
	to an increasing extent from here on out.	3:16
Moderator	In one of his recent tapes,	3:22
	Professor Samuelson emphasized that the present	3:24
	anti inflationary policy involves or may involve	3:27
	large cost in terms of unemployment.	3:31
	Do you agree with Professor Samuelson?	3:35
Friedman	Yes, and no.	3:37
	I agree with almost everything that he said.	3:38
	But I believe that what he said does not give a thoroughly	3:42
	satisfactory picture because of some things	3:47
	he might have said but didn't.	3:51
	The crucial question that one wants to ask,	3:54
	it seems to me is whether there is an alternative.	3:58
	When one speaks about the cause of the president policy,	4:01
	this implicitly seems to me to imply that there exists	4:07
	some alternative policy which could avoid those costs.	4:11
	And this is the respect in which,	4:14
	with this implicit view,	4:16
	not one, that Professor Samuelson stated explicitly	4:19
	that I would have some question.	4:22
	But let me go back and explain this because I do believe	4:25
	that the point at issue is one of the most important	4:27
	and one that is extremely urgent that the public at large,	4:30
	if possible, understands.	4:34
	The present policy, a policy of slowing down the rate	4:36
	of increase in the quantity of money,	4:40
	of holding down the rate of expansion in aggregate demand	4:42
	by fiscal measures as well,	4:45
	is a policy which will produce	4:47
	and cannot avoid but produce	4:51
	a decline in the rate of output of physical magnitude	4:54
	and some increasing unemployment.	4:58
	As my subscribers know, I am very much concerned	5:01
	that the magnitude of that policy at the moment	5:04
	that the extent to which it has been carried,	5:07
	threatens a more severe decline that is necessary.	5:10
	Professor Samuelson and I am sure would be an agreement	5:16
	that it is desirable to carry out this policy	5:19
	with a minimum cost of this kind.	5:22
	But that there will be some costs even with the most ideal	5:24
	policy carried out of this way,	5:27
	there can be no doubt.	5:28
	The reason there are such costs is because	5:31
	the way in which you stem inflation is by reducing	5:34
	the pressure of aggregate demand,	5:37
	the pressure of purchasing power	5:39
	on the goods and services available.	5:42
	In the first instance, this does not	5:44
	lower the rate of price increase.	5:47
	Those have an inertia of their own that are carried on	5:49
	from earlier, what this does in the first instance	5:52
	is to lower the rate of production	5:55
	the exuberance of production and output	5:57
	then this is what leads to an increase in unemployment.	5:59
	This is a byproduct, not a desirable thing,	6:02
	but a byproduct of this policy.	6:05
	Now, the crucial question is, or is there an alternative?	6:08
	The answer to that depends critically	6:12
	on what time period you have in mind.	6:14
	So far as a particular six month period,	6:17
	any particular six months period, there is an alternative.	6:19
	The alternative is to keep the rate of the quantity	6:23
	of money increasing rapidly,	6:27
	to keep the federal government being	6:29
	expansionary in its fiscal policy.	6:32
	Let me digress for a moment.	6:35
	As my subscribers know, I do not myself believe	6:37
	that what happens to the federal budget	6:40
	has much effect on inflation or expansion provided	6:44
	it does not affect monetary policy,	6:49
	the behavior of the quantity of money.	6:51
	But for the point I'm now making for the issue	6:53
	I am now discussing that is irrelevant.	6:55
	Whether I'm right or wrong on that,	6:57
	the same views would follow.	6:59
	And that is why I keep referring here in order to try	7:01
	to separate issues and keep it to one issue at a time.	7:04
	I keep talking here about both monetary and fiscal policy.	7:08
	Well, to go back, for any given six months,	7:12
	there is an alternative.	7:15
	We could maintain the US,	7:17
	the Federal Reserve Board couldn't maintain	7:20
	a rapid increase in the quantity of money.	7:22
	The rest of the government couldn't maintain	7:28
	an expansionary fiscal policy.	7:30
	Over that six month period that might keep employment	7:33
	from declining, it might hold on employment steady.	7:36
	But it would mean that prices would continue to rise.	7:39
	And if you look beyond the six months	7:43
	you would not have avoided the cost.	7:45
	Why?	7:48
	Because as prices continue to rise	7:49
	people's expectations as everybody is by now aware,	7:52
	adjust to that, they continue to anticipate that	7:55
	prices would rise and a degree of price rise	7:58
	is no longer as expansionary as it was before.	8:01
	What's expansionary is not rising prices,	8:04
	what encourages additions to output and employment	8:06
	of more people is not rising prices,	8:10
	but prices rising faster	8:12
	than people anticipate that they will rise.	8:14
	And thus, if you kept up the most recent rate of price	8:16
	increase, if you kept up a policy	8:20
	which meant the prices rose at five or six percent per year,	8:23
	well, then very quickly,	8:26
	that would lead to higher unemployment too.	8:27
	These costs would have been postponed and not avoided.	8:30
	Well, then we come to the next six months,	8:33
	we can postpone the cost still again.	8:36
	How?	8:38
	By stepping up still more the rate of rising prices,	8:39
	by going from five or six percent rate of inflation	8:42
	to six or seven or eight percent,	8:45
	by keeping the actual rate of inflation	8:47
	higher than anticipated	8:49
	and thus keeping this artificial pressure.	8:51
	Maybe I shouldn't use the word artificial,	8:53
	that seems like begging the question,	8:56
	keeping this pressure on the economy.	8:58
	Now that could be carried on for a fairly long time.	9:01
	One of the fascinating things to me is how long it takes	9:08
	for people to adjust to this kind of a situation.	9:11
	But as things now stand with the experience	9:17
	that the American people have had,	9:21
	with the extended attention that they have paid	9:23
	to inflationary developments,	9:26
	I believe that the period for which you could continue	9:28
	this kind of a policy would be far more limited	9:32
	than it has been in the past.	9:36
	But whether that be true or not,	9:37
	it is clear that the effect of this,	9:39
	would be to embark on a process	9:41
	in which you are committed not to a stable rate	9:44
	of inflation, but to a steadily rising rate of inflation.	9:46
	Now, this in turn, would create all sorts of problems	9:50
	and difficulties, there is little doubt	9:53
	that it's perfect would be an almost irresistible demand	9:55
	for wage and price controls.	10:00
	The wage and price controls themselves would then produce	10:02
	inefficiencies in the economy, which would mean that while	10:05
	employment might be high, output would stop rising,	10:09
	would become lower,	10:12
	at least output, or I shouldn't say low,	10:14
	would would grow at a negligible rate of decline	10:17
	at least output properly measured	10:20
	because of all the inefficiencies	10:22
	and all of the distortions that would be introduced	10:24
	by widespread wage and price controls.	10:26
	Even if you did not have that,	10:29
	if you had an open inflation it is hard to believe	10:31
	that the public at large will not become so fed up	10:34
	with such an inflation	10:36
	that it would demand stringent measures.	10:38
	At that point, you would have to step on the brakes.	10:40
	And when you stepped on the brakes at that point,	10:42
	with that much more severe an inflationary spiral	10:45
	behind you, the costs in terms of the inevitable	10:48
	unemployment and disruption of economy,	10:51
	would be far greater than they need to be now.	10:53
	We're in an early stage of this process.	10:56
	We can bring it to an end now, if we have the will	10:58
	and the skill, we can bring it into an end now	11:01
	with moderate costs.	11:05
	And therefore, going back to Professor Samuelson's	11:08
	main point, he is at right,	11:11
	that a policy of holding down the rate of growth	11:14
	of the quantity of money and holding down the rate	11:19
	of growth of aggregate demand does involve	11:21
	permitting unemployment to rise,	11:24
	does involve costs in these terms.	11:26
	But these are costs that are unavoidable,	11:30
	they are not the consequences of the policy	11:33
	that is being followed now.	11:35
	They are the consequences of the earlier mistake	11:37
	and letting inflation get started.	11:39
	Once that was done, there was no way of avoiding such costs.	11:41
	The only question is, "Do you suffer relatively moderate	11:46
	costs now, or do you postpone the confrontation	11:49
	with the hard facts and suffer	11:55
	much more serious costs later on."	11:58
Moderator	Professor Friedman, we have a question	12:01
	from one of your listeners,	12:04
	it fits directly into your present discussion.	12:05
	Why try to stall economy, is not the best way to combat	12:09
	inflation to increase production?	12:13
Friedman	Well, is a very, very, very	12:16
	fundamental question and does fit in exactly	12:19
	with what we have been speaking about.	12:21
	And one this is a question that has raised	12:23
	over and over again.	12:26
	Clearly, the level of prices depends on two things;	12:28
	the level of final demand,	12:34
	of aggregate demand on the one hand	12:35
	and the amount of production on the other.	12:38
	And it is certainly true that a one percent increase	12:40
	in output will have the same	12:44
	effect in reducing inflammation	12:49
	as a one percent decrease in demand.	12:53
	And so it does seem perfectly natural to ask,	12:57
	if our problem is that prices are too high	13:01
	or rising too much, why not combat it by having a greater	13:04
	rate of increase now?	13:08
	But and in particular the question comes up,	13:09
	is it not perverse, is it not absurd to combat it	13:11
	by reducing by a policy which will have the indirect	13:15
	on it perhaps undesired but nonetheless inevitable	13:18
	effect of reducing production?	13:21
	So then I have a great deal of sympathy with that question.	13:23
	And it is not easy	13:26
	to explain in full why there is no feasible	13:30
	way of stopping inflation	13:38
	by increasing production in the short run over brief period.	13:39
	But let me try to indicate some of the elements	13:43
	that add in to that answer.	13:45
	First one must have a sense of magnitude and the proportion.	13:48
	There is a very large difference in the possibilities	13:55
	of changing the rate of increase of production	13:59
	on the one hand, while the increase in aggregate demand	14:01
	through changing the monetary expansion on the other.	14:05
	Production is limited by physical possibilities.	14:11
	It's true that a one percent increase in production	14:16
	would have the same effect as a one percent lower rate.	14:18
	Let me put it in more precise term.	14:22
	That if production over the course of the year were	14:26
	to arise, and an annual rate of one percentage	14:29
	point higher would arise by let's say, four percentage	14:32
	points instead of three percentage points,	14:37
	or five instead of four.	14:38
	That that would have exactly the same effect	14:39
	on the cost of prices.	14:41
	As if aggregate demand would rise	14:42
	at a rate one percentage point lower.	14:44
	But considering the possibilities,	14:48
	what we can do in the way of physical production	14:50
	it's physically limited.	14:52
	It's determined by our capital equipment,	14:55
	by the skills of people by the organization of society.	14:57
	It is a major test to change the long run rate of growth	15:00
	from four percent to five, or six percent	15:04
	or from three percent to four percent.	15:07
	Over the course of our long run history,	15:10
	we've tended to increase output at the rate of something	15:12
	like three to four percent,	15:15
	and that's about the range it's feasible.	15:16
	Within the business cycle, that is to say,	15:19
	within short period, the periods when changes in the rate	15:23
	of output reflect changes in the level of employment,	15:26
	you can get much larger changes.	15:29
	But given that you are at already starting a level	15:32
	where you have reasonably full employment,	15:35
	it is almost inconceivable that you're gonna have any change	15:38
	in the organization of production,	15:44
	which from a purely physical point of view	15:47
	would enable you to increase the rate of output,	15:49
	given that you've exhausted the unemployed resources	15:53
	by more than one or two percentage points a year.	15:56
	On the other hand, the rate of growth of aggregate demand	16:00
	is a monetary phenomenon.	16:03
	There is no limit to the number of pieces of paper	16:05
	that can be printed,	16:08
	there is no limit to the number at the rate at which dollars	16:10
	offered can be increased.	16:12
	We have had fluctuations in the rate of expansion	16:16
	of the quantity of money that have gone from negative	16:19
	number two plus 10, 12% a year.	16:21
	And there is no technical reason why	16:24
	it can't go by plus 50, 75 or 80% a year,	16:26
	as it has in some South American countries, for example.	16:28
	And therefore, as a matter of magnitude,	16:33
	you're looking at to magnitudes that have all together	16:35
	different possibilities.	16:38
	The rate of expansion of monetary demand expressed	16:40
	in dollars is capable of being varied over a considerable	16:44
	range, the other is not, the other physical output is not.	16:47
	So that's the first reason.	16:51
	You do not have the same possibility.	16:52
	The reason for our inflation has not been in fact,	16:55
	if you look back the reason for inflation has not been	16:59
	that output has been growing too slowly.	17:02
	It has an output, it's been growing at a reasonably rapid	17:03
	rate over the last 10 years.	17:07
	The reason for the inflation is that the other component	17:11
	of it, the monetary demand, has been growing too rapidly	17:14
	at a much more rapid rate, and the discrepancy has recently	17:18
	been of the order of six, seven, eight percent,	17:22
	which is far more than it is feasible for a change	17:24
	in physical output to take care of it.	17:27
	That's the first question.	17:29
	But a second level is let's not look at just these numerical	17:31
	possibilities, let's ask ourselves	17:36
	the more important question how.	17:38
	Suppose you wanted to follow a policy of combating inflation	17:41
	by increasing production, how would you go about it?	17:45
	We have a predominantly free enterprise society,	17:49
	in which individuals engage in production and response	17:52
	to market demand in response to the incentives offered	17:55
	by final product prices on the market,	17:58
	by costs of production and so on.	18:01
	How in such a system,	18:05
	what are the policies in such a system?	18:07
	What are the feasible courses of action in such a system,	18:10
	Which can produce an increase in production	18:13
	or in the rate of production sufficient	18:17
	to offset inflation.	18:19
	iI we don't even think of our system,	18:22
	if we think even of alternative systems,	18:25
	collectivist, socialist, there is no system	18:28
	that has been able to produce temporary or increases	18:31
	in production by any method except one,	18:37
	and that method is to offer greater inducements to people.	18:41
	The way in which, if it is really urgent to try to get	18:47
	a greater rate of physical production of utilization	18:51
	of resources for production of goods,	18:54
	the only technique that in any society I know of	18:58
	has been effective has been to raise the prices	19:01
	that are offered for the final product,	19:03
	to give people an increase in incentive to produce.	19:05
	But that promotes inflation, not the opposite.	19:08
	And so in order to use increases in production	19:11
	as a device to offset inflation is necessary to have some	19:15
	method of increasing production	19:19
	by ways other than raising prices.	19:24
	By ways other than giving incentives,	19:29
	what are those other ways conceivably?	19:32
	They would have to be connected with improving	19:35
	the efficiency of production with lowering costs,	19:38
	because that would be the other side of the picture.	19:42
	You can make the incentive to produce more higher,	19:46
	either by increasing the prices paid or by reducing	19:48
	the cost, and from a purely physical point of view,	19:53
	you can have total production higher only in the second way.	19:55
	The only way which is physically feasible,	19:59
	the rate of higher total production,	20:01
	is to enable the same resources,	20:03
	the same number of man hours,	20:05
	the same capital equipment,	20:06
	the same goods and the same intermediate goods	20:08
	to produce a larger total output.	20:11
	Now far be it from me to deny that there are enormous	20:13
	opportunities in the United States for increased efficiency,	20:16
	for an increased inefficiency.	20:19
	We have great waste.	20:23
	In my opinion, the major part of this waste as a result	20:26
	of a bad government policy.	20:30
	We have government policies which essentially command	20:33
	us to use our resources in an inefficient way.	20:37
	I think it is extremely important from a long run point	20:41
	of view that we eliminate these interferences	20:44
	with efficient production.	20:47
	I will come back and name some of them in a moment.	20:49
	But the point I want to make now is a very different one.	20:51
	Well, I am in favor of such actions it is inconceivable	20:55
	that they can have significant effects within the so brief	20:58
	a period of time as as relevant	21:02
	for the problem of inflation.	21:04
	If we move in the direction of eliminating barriers	21:07
	to efficiency or promoting the efficiency,	21:11
	this conceivably could operate at a pace	21:13
	at which our rate of growth of output would	21:17
	be one or two percentage points higher per year,	21:20
	instead of being three percent per year,	21:23
	it might be four or five percent per year.	21:25
	But that is not the order of magnitude that is relevant	21:27
	to stopping and holding an inflation,	21:31
	which threatens to proceed at the rate of six,	21:33
	seven percent a year.	21:35
	Now, what are some of these sources of inefficiencies?	21:37
	Well, there are some obvious ones.	21:42
	The construction industry at the moment is very much	21:43
	in the public eye.	21:45
	There's all of a sudden the great spate of articles	21:46
	about how we are not producing enough housing	21:50
	for our growing population and so on.	21:52
	There is one industry in which we unquestionably	21:56
	have delivered governmental policies directed	22:00
	at making the production of housing an efficient activity.	22:02
	If you consider city building codes and requirements,	22:05
	most of which are the product of the collusion,	22:09
	I don't mean to use that in any in various sense,	22:15
	but as a descriptive sense, let me say the cooperation	22:18
	in order to avoid a bad term.	22:21
	Cooperation between skilled crafts unions	22:23
	the building trade union is on one hand,	22:26
	building contractors and local officials on the other	22:28
	to establish standards for building codes	22:32
	that will have the effect of maintaining the demand	22:34
	for the services of the skilled workers,	22:37
	are our ingenious.	22:40
	Free enterprise system is working its way around	22:43
	this to some extent through the mobile home industry.	22:45
	And the industry of producing components,	22:49
	factory built components.	22:52
	In this way, we're trying to bypass the barrier to efficient	22:54
	production introduced by the local buildings codes,	22:57
	and the local trade unions.	23:00
	But here you could very greatly increase the efficiency	23:02
	of the construction industry,	23:07
	if it were possible to reduce the monopoly power	23:08
	which the skilled craft unions have	23:12
	in the various local communities.	23:14
	But that is not going to be done overnight.	23:16
	That's not going to be something which will double	23:18
	your efficiency, it's something which will increase slowly.	23:20
	Again, are tariff legislation,	23:27
	our so called protective legislation,	23:29
	which restricts imports,	23:32
	which says that we should produce things at home even though	23:36
	you could produce them more efficiently,	23:40
	or your get them more efficiently abroad,	23:42
	is a false which unquestionably makes in my opinion,	23:44
	for a less efficient use of our resources.	23:51
	And we can have we are using resources to produce things	23:53
	which you will be much more efficient to get	23:57
	by producing other things, selling them abroad	23:59
	and buying the goods abroad.	24:01
	But again, that's not something that's going	24:02
	to produce results overnight.	24:05
	I could go on and on and on.	24:07
	But that would get me too far off from the topic.	24:08
	Let me only mentioned some of what I regard as the other	24:11
	major sources of inefficiencies in an efficient production.	24:13
	Government regulation, through ICC, FTC, FCC, and so on.	24:17
	The whole lot of the regulatory agencies,	24:22
	which tend to shore up existing producers and to reduce	24:25
	the extent of competition.	24:30
	Again our tax legislation,	24:32
	which encourages wasteful investment	24:34
	by giving enterprises a greater incentive to plow back	24:38
	earnings into distributed	24:42
	which encourages expenditures in ways that can get around	24:44
	taxes rather than otherwise.	24:47
	On that score, the fact that a very large number	24:50
	of enormously able, enormously ingenious people devote their	24:53
	entire energy to figuring ways to get around the income tax	24:59
	law instead of doing something which would	25:02
	be socially productive.	25:04
	But as you can see, I'm really going off into	25:05
	a wholly different area.	25:08
	None of these are effective ways of offsetting inflation.	25:09
	Now, one final comment on this,	25:13
	one of the things that to some extent is that extremely	25:15
	depressing, is how difficult it is for people	25:17
	to learn from experience.	25:20
	Inflation is not a new thing.	25:22
	It has occurred over and over again, through history,	25:25
	we have hundreds of years of it.	25:27
	There has never been an inflationary period that I know of	25:30
	in which there has not been	25:37
	a substantial pressure for particular kinds of measures	25:40
	to combat inflation consisting on the one hand	25:45
	of wage and price controls.	25:47
	That's the first thing people think of,	25:49
	the prices are going up stop them from rising.	25:50
	And then the second part of the discussion	25:53
	about the desirability of increasing production.	25:55
	These are legit solutions,	25:58
	have been suggested every time or almost every time	26:02
	there has been an inflation.	26:06
	They have often been tried	26:09
	particularly the wage and price controls.	26:12
	There is not a single documented example that I know	26:14
	of a success and applying this.	26:17
	On the other side of the picture,	26:19
	inflations have often been stopped.	26:22
	And they have been stopped in one way,	26:24
	and one way only, by slowing down the growth of aggregate	26:26
	demand and in almost invariably by something	26:29
	or other which is reduced the rate of growth	26:32
	of the quantity of money.	26:34
	On this broad issue of which of these two directions	26:37
	is a feasible way for slowing down in inflation	26:40
	I believe the historical evidence	26:45
	is overwhelmingly decisive.	26:47
	And yet each time we have the same false remedies	26:49
	proposed and the same false analysis of the situation.	26:55
	Now that's perhaps an over pessimistic account.	26:59
	But nonetheless, it is a very depressing commentary.	27:03
Moderator	One final brief question.	27:08
	What do you think of property taxes?	27:10
	Wouldn't an income tax be a more equitable method	27:12
	for local governmental units to raise revenues?	27:15
Friedman	That is a brief question but not necessarily	27:20
	a brief answer, but I will try to keep it short.	27:23
	One must distinguish between property taxes	27:28
	have two kinds; property taxes on land per se,	27:30
	and property taxes on improvements.	27:34
	With respect to property taxes on land,	27:36
	their effect has already been born when the taxes	27:39
	were initially imposed.	27:45
	Their effect on people now involved is to make the price	27:47
	of land lower than it otherwise would be.	27:50
	The effect of such a property tax	27:53
	it doesn't affect the quantity of land that there is	27:55
	but what it does affect is the price people are willing	27:58
	to pay because the price people are willing to pay for land	28:02
	depends on the return from it less the costs	28:05
	including the taxes.	28:07
	Now there have been real problems about these property	28:10
	taxes they have tended to be discriminatory,	28:12
	to be higher on occupied unoccupied land and so on.	28:15
	But to put it in very brief term,	28:19
	there is no tax that I know of	28:22
	which has less adverse effects on anything,	28:24
	than taxes on a pure land.	28:28
	This is the element of truth	28:30
	in Henry George's single tax argument.	28:32
	With respect to taxes on improvements,	28:34
	that becomes a more complicated problem,	28:36
	and it's by no means so clear.	28:38
	I do in general, aside from property taxes,	28:41
	I've always believed that a flat rate income tax	28:45
	and income tax above an exemption is probably	28:47
	the least undesirable way in which a government	28:50
	can raise its revenue.	28:53
Moderator	Thanks very much Professor Friedman.	28:54
	Remember subscribers, if you have any questions or comments	28:57
	comments for topics you would like to hear discussed	29:00
	in this series, please send them	29:02
	to Instructional Dynamics Incorporated,	29:04
	one, six, six Superior street Chicago, Illinois	29:07
	six, O, six, one, one.	29:10
	Dr. Friedman will be visiting with you again in two weeks.	29:12

Item Info

Title:

Tape 37 - Monetary Developments, Economic Development, Cost of Anti-Inflation, Production / Property Taxes

Date:

1969

Contributor:

Friedman, Milton, 1912-2006

Subject:

Format:

audiocassettes

Language:

English

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Paul A. Samuelson papers, 1933-2010 and undated

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Paul A. Samuelson papers, 1933-2010

Series:

Economics Cassette Series: Milton Friedman

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ref2598_dx8
samuelsonpaul
duke:325252
pstau001229
ark:/87924/r4mk65r2p
18ecdaf4-6be0-4b09-895a-552295a5701a

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Tape 37 - Monetary Developments, Economic Development, Cost of Anti-Inflation, Production / Property Taxes

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