Capitalism and Freedom (1960) - Day 1a

Page vii - x, Preface, 2002

1. 1960, total federal, state, and local government spending was 26% of GNI. (Non-defense spending was 12% of GNI, Defense was 14% of GNI.) The book's ideas were widely ignored.
2. 1982, total governmental spending was 39% of GNI (Non-defense was 31% of GNI, Defense was 8% of GNI). The results of this massive increase in government spending changed people's opinions and got Reagan and Thatcher elected.
3. 2000, total spending = 36%
4. 2006 total spending = 43%. (Source: Grandfather Economic Report)

1. Opinions of the book's ideas also were boosted by a posteriori results:
1. The end of a 70-year experiment (Berlin Wall fell in 1989, Soviet Union collapsed in 1992)
1. Top down vs. Bottom Up
1. Central Planning and Control vs. Private Markets
1. Socialism vs. Capitalism
2. Smaller Scale Examples of Capitalism beating Socialism
   
1. Hong Kong and Taiwan vs. China
2. West Germany vs. East Germany
3. South Korea vs. North Korea
3. China: 1970's Deng Xiaoping privatized agriculture (Socialism with Chinese Characteristics) which increased productivity.
1. All this gave credence to Friedrich A. Hayek's Road To Serfdom (1944)
4. Other Countries
1. After World War II, everybody thought development in the third world requried central planning plus massive foreign aid. This failed and was pointed out in Peter Bauer's Equality, the Third World, and Economic Delusion.
   
2. East Asia Tigers
1. Hong Kong
2. Singapore (an island city-state at the tip of the Malay peninsula)
   
3. Taiwan
   
4. South Korea
3. Latin American countries
   
4. Countries in Africa, after adopting free markets, increased prosperity.
   
5. Eastern European Countries: the ones that went towards free-markets saw increased economic prosperity.

Read up on which and the impact of Latin American, African and Eastern European countries adopting free-market policies. Aren't Socialists just plain-old, flat-out, straight-up, evil if they aren't willing to accept that poorer people, while not as well off as the wealthy in these societies, are infinitely better off under Capitalism than not?

I'm curious how Friedman explains why, despite the ubiquitous failure of Socialism the world over and the movement towards free-markets, that total U.S. governmental spending as a percentage of GNP has continued to increase. (John says see: Larry Niven and Larry Pornelle)