If he still lived, Tuesday July 31st would have marked the 100th birthday of Professor Milton Friedman. The Brooklyn-born son of immigrants, Friedman established himself as one of the world’s foremost economists, culminating in 1976 with the Nobel Prize for Economics. But if Dr. Friedman were able to celebrate his birthday in Connecticut this year, he may well have taken the opportunity to chide the state’s leaders for the cronyism that now masquerades as “economic development”.

Dr. Friedman’s 1978 book “Free to Choose” was turned into a ten part series of the same name by PBS in 1980. Interested viewers can watch the entire program via YouTube. Each episode starts with a 30 minute video narrated by Dr. Friedman highlighting examples and case studies to prove his views on markets and the economy and then moves to a half-hour discussion with Friedman and an assembly of guests debating the points presented in the video.

These debates, marked by unfailing politeness amid sharp disagreement, stand in stark contrast to what passes for debate in the current political context.

Amid an exchange in the first episode, entitled the Power of the Market, Friedman speaks about opposition to free markets from the business community: “The businessmen are very different. Every businessman wants freedom for somebody else. But he wants special privilege for himself. He wants a tariff from Congress and the Congressman, well the way in which the Congressman gets elected is by performing favors for constituents.”

Though spoken more than three decades ago, the words seem equally appropriate today. While Friedman’s students and supporters around the world gathered at one of 123 events in his honor this week, Connecticut’s leaders spent it heralding the latest economic development news.

Gov. Dan Malloy announced this week that Deloitte LLP will be the seventh company receiving government subsidies in exchange for expanding in Connecticut. Through funds offered under Malloy’s “First Five” program, the company will receive between $9 million and $14.5 million in state funds if they meet job creation benchmarks over the next six years.

That announcement came close on the heels of a similar one last week in which the retail giant Dollar Tree, Inc unveiled a plan to locate a distribution center in Windsor. The state incentive package on the deal could cost up to $27.5 million.

Concomitant with these announcements is the still unraveling Speaker Chris Donovan influence peddling scandal in which eight arrests have already been made. Donors seeking special privileges from the legislature for the roll your own tobacco industry are purported to have organized straw donors to Mr. Donovan’s campaign for U.S. Congress in exchange for his help. The Donovan for Congress campaign is alleged to have received more than $27,000 in illegal contributions and has since handed those contributions back to the federal government.

Similarly, there can be little doubt that companies coaxed to Connecticut by Gov. Malloy will be nothing if not vigorous in their support for the Governor when he seeks re-election in 2014. Though Malloy’s government-funded campaign will hold itself up as a model of cleanliness, the ability of SuperPACs to play in state politics assured by American Traditions Partnership, LLC v. Bullock means that the debt will be repaid one way or another.

The result will be the worst of all possible worlds for taxpayers as they both pay for a government-funded campaign system and the cronyism that facilitates the unsavory aspects of the private-funded system.

As noted by Dr. David R. Henderson in his paper The Economics and History of Cronyism: ‘There is only one way to end, or at least to reduce, the amount of cronyism, and that is to reduce government power.”# Similarly, Milton Friedman viewed his role as an agent of change, hoping to persuade people that their interest was better served by expanding individual liberty and curtailing the insidious alliance government and business.

The effort must continue.

Heath W. Fahle is the Policy Director of the Yankee Institute for Public Policy and a former Executive Director of the Connecticut Republican Party. Contact Heath about this article by visiting www.heathwfahle.com

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