Milton Friedman’s return to UK economic policy?

An open consultation titled ‘Competition regime: Competition and Markets Authority (CMA) – government’s strategic priorities’ was published today with the goal to seek views on the government’s proposed new strategic steer that will outline the priorities for the CMA during this parliament. Nothing overly exciting, until one looks at the first Annex and its first line that says:

The most important single central fact about a free market is that no exchange takes place unless both parties benefit.” – Milton Friedman

Moreover, the consultation goes on and makes claims like: ‘Throughout history, free and open markets have consistently shown themselves to be far more balanced and effective than anything government can deliver.’

Why is this important? Because according to the document, the steer’s purpose it to provide ‘a clear statement of how the government sees competition fitting with its wider objectives for the economy’ and that the ‘Steer gives a clear mandate to help government design policy interventions and, when necessary, actively challenge any government rules and regulations if they consider they are negatively affecting competition’.

Friedman’s famous quote was said in an interview in the context of the importance of trading despite government limitations on trade, and referring to the mutual benefits of private markets over government coercion. Friedman used his statement to draw attention to situations where natural law overwrites black letter law. A government recognising the importance of Friedman’s quote is already laudable. The question is was the choice of the quote a deliberate hint or only a random coincidence?

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