Today, march 1st 2010 I am reading an article in the "breaking news" section of Chicago Tribune. The article is called "Personal spending jumps, but incomes stuck." It is very important to understand that the issue we are presented with relates to economic freedom. According to the article, personal spending jumped in january more than expected for Americans, and this poses a problem because income has been almost unchanged. If income would increase, then people would be able to buy more products, and the personal spending budget would increase. This is what social economic freedom represents. The power to buy things because of your economic independence, and financial self-sufficiency.
You may be asking how this relates to Friendman and his theories discussed in class. Well, Friedman presents the issue as economic freedom leading to total freedom from a "state" point of view. But from a personal point of view, we can see that economic freedom leads to more choices and less worries about the spending budget, therefore more freedom. Now if economic freedom leads to TOTAL freedom, that is another matter.
By analyzing the meaning of "total freedom" I have come to the conlcusion that economic freedom can lead to total freedom when it comes to the well-being of a country. But when talking about individual human beings, economic freedom becomes simply a tool or an instrument in achieving total freedom.
So could "economic freedom" be understood as a self-sufficient independent status of a country? What about when it comes down to population, which constitutes a big part of the country? Is the meaning of "economic freedom" the same for individual people as it is for a country?
Here is the link to the article:
http://www.chicagobreakingbusiness.com/2010/03/personal-spending-jumps-but-incomes-stucks.html
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This is an interesting article, however it is confusing in your post as to what you think Friedman would say about this. I think that since economic freedom is a major part of total freedom in the eyes of Friedman, he would say that this would be a time that the government would need to step in to ensure the freedom of the nation. It is interesting that you mentioned the difference between individual freedom and the freedom of a country.
ReplyDeleteI agree with Daniel, the more economic freedom we have the more we can save and spend therefore we can strive for the welfare of all and the economy too. But in order to do so the government has to stay out of private businesses, that way they can only enforce the rules of the economic game instead of taking part in it. The government is restricting citizen’s from perusing their goals and making profits by not privatizing entities. I agree with Friedman too, because in order for us to get more opportunities and save more, not only spend more, the government needs to get involved into privatization more often.
ReplyDeleteThe entire topic you are discussing is just the smaller picture of what economic freedom is. Economic freedom is the right to work where you want. From this ability comes capital, and from this comes the ability to spend. I wan't really sure where you were trying to go with, with this article, but people can only be able to spend what they make, and government shouldnt really try to do anything to change how much they make.
ReplyDeleteThe relationship you made between American's spending habits and economic freedom is one I would not have picked up. It makes for an interesting thought. Milton Friedman sees economic freedom as a part of total freedom is necessary but not sufficient. As a whole, American's may be spending more than their earnings due to neglegence and poor spending habits.
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