It’s obviously never a happy occasion when someone dies, but I think that when economic historians look back to our era, they’ll say it was a particular tragedy that Milton Friedman died in 2006 and didn’t live to see the 2008 financial crisis. Friedman made a name for himself by arguing that the Federal Reserve deepened and prolonged the Great Depression with excessively tight monetary policy. Then, later in his career, he became a leading advocate for the view that the inflation of the 1970s was due to an excessively loose monetary policy.
These positions are two sides of the same coin. Unfortunately, many more people remember his hawkish work on the 1970s than his dovish work on the 1930s. And because Milton Friedman died two years before the financial crisis hit, he wasn’t around to remind us of that side of his work.
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