Milton Friedman’s critique of JFK’s “Ask not what your country can do for you – ask what you can do for your country”

25 12 2012

Ask not what your country can do for you – ask what you can do for your country.” John F. Kennedy, Inaugural address, Friday, January 20, 1961. (see further info on JFK’s inaugural address here: http://www.presidency.ucsb.edu/ws/index.php?pid=8032 )

President John F. Kennedy’s Inaugural Address, January 20, 1961

Americans of all political and personal persuasions need to sincerely appreciate the work and service and sacrifice of former U.S. President John F. Kennedy.  That said, in the introduction on pages 1-2 to “Capitalism and Freedom” (1962), Economist Milton Friedman gave his thoughts and constructive critique on how a free man in a free society should respond to former President John F. Kennedy’s famous quote in his 1961 inaugural address.

No disrespect is meant here regarding the statements of President Kennedy or his contributions to our country. But rather the ideas and thoughts of Milton Friedman regarding this famous statement are particularly relevant to the role of the individual citizen in relation to the government in the United States today (emphasis in terms of bold, underlined, or italicized text are mine)

   “In a much quoted passage in his inaugural address, President Kennedy said, ‘Ask not what your country can do for you – ask what you can do for your country.’  It is a striking sign of the temper of our times that the controversy about this passage centered on its origin and not its content.  Neither half of the statement expresses a relation between the citizen and his government that is worthy of the ideals of free men in a free society.”

“The paternalistic “what your country can do for you” implies that government is the patron – the citizen, the ward, a view that is at odds with the free man’s belief in his own responsibility for his own destiny.  The organismic, “what you can do for your country” implies that government is the master or dietythe citizen, the servant or votary.” 

To the free man, the country is the collection of individuals who compose it, not over and above them. He is proud of the common heritage and loyal to common traditions, but regards government as a means, an instrumentality – neither a grantor of favors and gifts, nor a master or god to be blindly worshipped and served.  He recognizes no national goal except as it is the consensus of the goals that the citizens severally serve.  He recognizes no national purpose except as it is the consensus of the purposes for which the citizens severally strive.”

The free man will ask neither what his country can do for him nor what he can do for his country. He will ask rather “What can I and my compatriots do through government” to help us achieve our several goals and purposes, and above all, to protect our freedom?” 

And he will accompany this question with another: “How can we keep the government we create from becoming a ‘Frankenstein’ that will destroy the very freedom we establish it to protect?“”

“Freedom is a rare and delicate plant. Our minds tell us, and history confirms, that the great threat to freedom is the concentration of power.  Government is necessary to preserve our freedom – it is an instrument through which we can exercise our freedom; yet by concentrating power in political hands, it is also a threat to freedom. Even though the men who wield this power initially be of good will and even though they be not corrupted by the power they exercise, the power will both attract and form men of a different stamp.”

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Source: Africanliberty.org

President Kennedy’s words were no doubt intended to call, inspire, and challenge we as Americans to more selfless service to our fellow citizens – and he and his legacy are to be commended for them.  However, here Milton Friedman provided a wary warning about the leeway that Kennedy’s words of challenge and inspiration allow for the misuse of concentrated government power in inhibiting and limiting the economic and political freedoms of free people in free societies – such as is the United States.

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“U.S. Unemployment Rates and FED/Central Bank Policy (Becker on “Becker-Posner” Blog)

22 12 2012

The Becker-Posner Blog (http://www.becker-posner-blog.com/) features the economic point-counter point discussions of Gary Becker and Richard A. Posner.

Gary Becker is University Professor Department of Economics and Sociology Professor, Graduate School of Business at the University of Chicago.  He was awarded the Nobel Memorial Prize in Economic Sciences in 1992 and received the United States Presidential Medal of Freedom in 2007. He is currently a Rose-Marie and Jack R. Anderson senior fellow at Stanford University’s Hoover Institution.  His homepage is found here.

Richard A. Posner is a legal scholar and Federal Judge on the United States Seventh Circuit Court of Appeals, and Senior Lecturer, University of Chicago Law School.  His home page is found here.

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Following is and excerpt from Gary Becker’s latest post (12/16/2012) on “The Unemployment Rate and Central Bank Policy“, posted at the following web address:

http://www.becker-posner-blog.com/2012/12/the-unemployment-rate-and-central-bank-policy-becker.html

The Unemployment Rate and Central Bank Policy-Becker

Low inflation and “full” employment have been statutory goals of the Federal Reserve for the past 35 years. Often, however, inflation received the most attention, as when former Fed chairman Paul Volcker in the early 1980s sharply raised interest rates and put the economy in recession in order to wring inflationary expectations out of the system.

On December 12th, Ben Bernanke, the chairman of the Fed, indicated that the Fed would pursue what one might think is simply a variant of the full employment target by keeping nominal interest rates close to zero until the US unemployment rate dips below 6.5%-it is currently 7.7%- or until inflation is forecast to exceed 2.5%. The challenge facing this proposal is that while an unemployment rate target may seem to be just the flip side of the full employment target, unemployment can be nudged by other government policies in ways that have little effect on employment.

The present high level of unemployment in the US in good measure reflects the slow rate of recovery of real GDP and employment from its recession levels. According to “Okun’s Law”, the recovery in employment from a recession is simply related to the recovery in real GDP (see the discussion of Okun’s Law in my blog post on 11/4/2012). Okun’s Law implies that a central bank can use the recovery in real GDP as a proxy for the recovery in employment toward a full employment goal.

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The complication is that changes in unemployment rates during business cycles are not just mirror images of changes in employment rates. This has been especially the case during the Great Recession. By definition, the unemployed equals the difference between the number of persons in the labor force and the number of persons working. The unemployment rate is then defined as the number of individuals who are unemployed as a fraction of the labor force. It follows from the definition of unemployment that the unemployment rate equals one minus the employment rate (the ratio of the number of persons employed to the number of persons in the labor force). This relation shows that changes in the unemployment rate would be equal to but opposite in sign to changes in the employment rate only as long as the labor force remained fixed.

During business cycles, the employment rate and the unemployment rate do move in opposite directions, but the relation is far from one to one, especially during severe recessions. The reason is that the labor force also changes over the course of a business cycle. Especially during severe recessions, some workers get discouraged about finding jobs and leave the labor force. This would tend artificially to reduce the unemployment rate even when both employment and unemployment did not change. This is why the official unemployment rate is usually supplemented with measures of the “total” unemployment rate that include both individuals who got discouraged and withdraw from the labor force, as well as those working part time because they could not find full time jobs. This total unemployment rate now stands at 14.4%, much above the 7.7% official rate.

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The unemployment rate is also affected by policies that affect eligibility for unemployment compensation, such as the extension of unemployment benefits during this recession to 99 weeks. Such an extension increases unemployment because it encourages individuals to become or remain unemployed in order to collect unemployment benefits for a longer time. The net effect of extensions in unemployment benefits is to increase the unemployment rate differently from any decline in the employment rate.

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A major risk of trying to implement an unemployment target through present Fed policies is that the inflation rate could increase in a futile attempt to bring down further the unemployment rate to a targeted rate, as happened in the 1970s. To its credit, the Fed protected against this possibility by setting its target at a relatively high unemployment rate of 6.5%, even though the rate prior to the onset of the recession in 2007 was well under 5%. The Fed also directly faced the risk of creating excessive inflation by setting its target as no more than 6.5% unemployment only as long as the inflation rate does not rise about 2.5%, a modest rate of inflation.





“God’s Grace as a Rule of Life” (Chafer and Walvoord, 1974)

3 12 2012

In the classic book “Major Bible Themes” (Zondervan Publishing House, Grand Rapids, Michigan – 1974) (click here), author John Walvoord (updating the original work of Lewis Sperry Chafer published in 1923 and 1956) discusses the Grace of God as a Rule of Life (Chapter 29, pages 192-193-71).  Walvoord presents an “operative” view of the grace of God that is accessible, applicable and helpful to born again believers like you and I today.

File:Sunrise, Manaslu.jpg Manaslu (also known as Kutang) is the eighth highest mountain in the world, part of the Nepalese Himalayas.  Its name, which means “Mountain of the Spirit”, comes from the Sanskrit word Manasa, meaning “intellect” or “soul”. Manaslu is 8,156 metres (26,759 ft) above mean sea level (source: Wikipedia)

Following are some quotations from Walvoord/Chafer in regards to the grace of God as a rule of life for us…..

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“For the child of God under grace, every aspect of the law is now done away with.

1. The legal commands of the Mosaic system and the commands which are to govern the kingdom are not now the guiding principles of the Christian.  They have been superseded by a new and gracious rule of conduct which includes in itself all that is vital in the law, but restates it under the peculiar order and character of grace.

2. The child of God under grace has been delivered from the burden of a covenant of works.  He is not now striving to be accepted, but rather is free to live as one who is accepted in Christ.

3. The child of God is not now called upon to live by the energy of his own flesh.  He has been delivered from the feature of the law and may live in the power of the indwelling Spirit. Since the written law was delivered to Israel, she alone could be delivered from the written commandments of Moses by the death of Christ.  However, both Jew and Gentile were delivered by that death from the hopeless principle of human merit and from the useless struggle of the flesh.

4. In contrast with law, the word “grace” refers to the unmerited favor which represents the divine method of dealing with mans that was introduced by Adam.  Under grace, God does not treat men as they deserve, but He treats them in infinite mercy and grace without reference to their desserts.  This He is free to do on the ground that the righteous punishment for sin, which His holiness would otherwise impose upon sinners as the just dessert, was borne for the sinner by the Son of God (i.e., by Jesus Christ in his atoning death on the Cross of Calvary – blogger’s note).

5. In contrast with law, grace is revealed in three different aspects: (a) salvation by grace, (b) safekeeping by grace, and (c) grace as a rule of life for the saved.

Approaching the Manaslu Mountain Summit

5a) Salvation by grace: God saves sinners by grace, and there is no other way of salvation offered to men.

Acts 4:12: “And there is salvation in no one else; for there is no other name under heaven that has been given among men by which we must be saved.” (NASB)

Saving grace is the limitless, unrestrained love of God for the lost acting in compliance with the exact and unchangeable demands of His own righteousness through the  sacrificial death of Christ. Grace is more than love; is it love set free and made to be a triumphant victor over the righteous judgments of God against the sinner.

When He saves a sinner by grace, it is necessary that God shall deal with every sin, for they would otherwise demand judgment and thus hinder His grace.  This He has wrought in the death of His Son.  It is also necessary that every obligation shall be canceled, and to this end salvation has been made an absolute gift from God.

John 10:28: “and I give eternal life to them, and they will never perish; and no one will snatch them out of My hand.” (NASB)

Likewise, it is necessary that every human merit shall be set aside, lest the thing which God accomplishes be in any measure based on the merit of men and not on His sovereign grace aloneSince every human element is excluded, the gospel of grace is the proclamation of the mighty, redeeming, transforming grace of God, which offers eternal life and eternal glory to all who believe.

Galations 3:22 “But the Scripture has shut up everyone under sin, so that the promise by faith in Jesus Christ might be given to those who believe.” (NASB) 

5b) Safekeeping through grace: The divine program of safekeeping through grace demonstrates that through grace alone God keeps those who are saved.  Having provided a way whereby He can act in freedom from His own righteous demands against sin, having disposed of every human obligation for payment, and having set aside eternally every human merit, God has only to continue the exercise of grace toward the saved one to secure his safekeeping forever.  This He does, and the child of God is said to stand in grace.

Romans 5:2 “through whom also we have obtained our introduction by faith into this grace in which we stand; and we exult in hope of the glory of God.” (NASB)

5c) Grace as a rule of rule of life for the saved: God provides also a rule of life for the saved based on the grace principle.  God teaches those who are saved and kept how they should live in grace and how they may live to His eternal glory.  As the law provided a complete rule of conduct for Israel, so God has provided a complete rule of conduct for the Christian.  Since all rules of life which are presented in the Bible are complete in themselves, it is not necessary that they be combined.  Therefore the child of God is not under law as a rule of life, but he is under the counsels of grace.  What he does under grace is not done to secure the favor of God, but it is done because he is already accepted in the Beloved (i.e., accepted by saving grace through faith in Jesus Christ).  It is not undertaken in the energy of the flesh, but is is the outliving and manifestation of the power of the indwelling Spirit.  It is a life which is lived on the principle of faith.

Habakkuk 2:4 “Behold, as for the proud one, His soul is not right within him; But the righteous will live by his faith.”  (NASB)

Hebrews 10:38 “But My righteous one shall live by faith; And if he shrinks back, My soul has no pleasure in him.” (NASB)

Mount Manaslu Mount Manaslu

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Blogger’s Comments….

We are saved only by grace through faith in the atoning work of Jesus Christ on the cross in payment for our sins.  Concerning the way and means of salvation, God says in His Word in Romans 10:5-17…

For Moses writes that the man who practices the righteousness which is based on law shall live by that righteousness. But the righteousness based on faith speaks as follows: “Do not say in your heart, ‘Who will ascend into heaven?’ (that is, to bring Christ down), or ‘Who will descend into the abyss?’ (that is, to bring Christ up from the dead).” But what does it say? “The word is near you, in your mouth and in your heart”—that is, the word of faith which we are preaching, that if you confess with your mouth Jesus as Lord, and believe in your heart that God raised Him from the dead, you will be saved; 10 for with the heart a person believes, resulting in righteousness, and with the mouth he confesses, resulting in salvation. 11 For the Scripture says, “Whoever believes in Him will not be disappointed.” 12 For there is no distinction between Jew and Greek; for the same Lord is Lord of all, abounding in riches for all who call on Him; 13 for “Whoever will call on the name of the Lord will be saved.”

14 How then will they call on Him in whom they have not believed? How will they believe in Him whom they have not heard? And how will they hear without a preacher? 15 How will they preach unless they are sent? Just as it is written, “How beautiful are the feet of those who bring good news of good things!”

16 However, they did not all heed the good news; for Isaiah says, “Lord, who has believed our report?” 17 So faith comes from hearing, and hearing by the word of Christ.

Mount Manaslu