The problem of social organization is how to set up an arrangement under which greed will do the least harm, capitalism is that kind of a system.
Interpretation
Friedman argues that capitalism minimizes the negative effects of greed in society.
In this quote, Milton Friedman emphasizes the inherent challenge of structuring society in a way that mitigates the adverse outcomes associated with human greed. He suggests that capitalism, with its market mechanisms and competitive nature, provides a framework where individuals can pursue their self-interest while simultaneously contributing to societal welfare, thereby reducing the harm that greed can inflict on social organization.
In practice
This quote could be referenced during a debate about economic systems in a political discussion.
The economic miracle that has been the United States was not produced by socialized enterprises, by government-unon-industry cartels or by centralized economic planning. It was produced by private enterprises in a profit-and-loss system. And losses were at least as important in weeding out failures, as profits in fostering successes. Let government succor failures, and we shall be headed for stagnation and decline.
Universities exist to transmit knowledge and understanding of ideas and values to students not to provide entertainment for spectators or employment for athletes.
There is no place for government to prohibit consumers from buying products the effect of which will be to harm themselves.
There is one and only one social responsibility of business - to use it resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.
The great danger to the consumer is the monopoly -whether private or governmental. His most effective protection is free competition at home and free trade throughout the world. The consumer is protected from being exploited by one seller by the existence of another seller from whom he can buy and who is eager to sell to him. Alternative sources of supply protect the consumer far more effectively than all the Ralph Naders of the world.
The strongest argument for free enterprise is that it prevents anybody from having too much power. Whether that person is a government official, a trade union official, or a business executive. If forces them to put up or shut up. They either have to deliver the goods, produce something that people are willing to pay for, are willing to buy, or else they have to go into a different business.
Industry entirely left to itself, would soon fall to ruin, and a nation letting everything alone would commit suicide.
Our economy is the result of millions of decisions we all make every day about producing, earning, saving, investing, and spending.
We've used up a lot of bullets. And we talk about stimulus. But the truth is, we're running a federal deficit that's 9 percent of GDP. That is stimulative as all get out. It's more stimulative than any policy we've followed since World War II.
Never in the history of human credit has so much been owed.
Credit markets were originally created to serve human needs; to provide businesses and individuals with capital to start or expand businesses or fulfill other financial needs.
We need to keep in mind the well-established fact that the full effects of monetary policy are felt only after long lags. This means that policy makers cannot wait until they have achieved their objectives to begin adjusting policy.
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