Five Milton Friedman Ideas Every Student and Parent Should Know

As soon as July rolls around, we are reminded of the birthday of a man whose ideas continue to shape the world (especially when it comes to education and freedom), and that man is Milton Friedman.

A Nobel Prize-winning economist and public advocate of groundbreaking ideals, Friedman helped to reshape how we think about freedom, education, and the role of government in our lives. For an increasing number of students today, his ideas aren’t just embedded in economic textbooks but also in the very fabric of their education.

In honor of what would have been Milton Friedman’s 113th birthday, here are five of his core ideas that continue to shape our understanding of education and liberty. 

Idea #1: School Choice and Vouchers

Milton Friedman believed that families, rather than the government, should decide where their children attend school. In the paper “The Role of Government in Education” first published in 1955, he outlined what such a system might look like. Families could receive vouchers to utilize all or part of the public funding allocated for a child’s education. The funds that would be typically spent by a school district would instead be allocated to the participating family to help pay for their child’s private school education. School vouchers would give parents the freedom to choose a private education for their child without having to pay twice for it (paying taxes for the public-school education and paying the private school tuition). Milton believed that this would enable lower-income families to enroll in private schools, creating competition, increasing diversity, and driving innovation in the education system, ultimately leading to its improvement.

This year, there were 81 choice programs in 33 states (plus Washington, D.C., and Puerto Rico) serving approximately 1.2 million students, thanks to Friedman’s groundbreaking ideas.

Idea #2: Government Should Fund–Not Run–Schools

Friedman believed that funding of education (particularly basic or primary education) is a crucial role of the government because education doesn’t just benefit the individual, it benefits society as a whole. He viewed education as a positive externality (when a good is produced or consumed and benefits a third party without compensation to the producer/consumer). Friedman said, “A stable and democratic society is impossible without a minimum degree of literacy and knowledge on the part of most citizens and without widespread acceptance of some common set of values. Education can contribute to both. In consequence, the gain from the education of a child accrues not only to the child or to his parents but also to other members of the society”. Friedman believed that others benefit from someone being educated.  An educated person is more likely to participate in civil life, obey laws and respect rights, maintain a stable democratic society, and contribute to economic growth.

While Friedman supported public financing of education, he was against the government running schools. Friedman said, “Schools are now run by professional bureaucrats. Monopoly and uniformity have replaced competition and diversity. Consumers of schooling have little to say”. He believed government-run schools lead to monopolies, resulting in little competition, low responsiveness to families, and a lack of innovation. Government control would deny families choice and limit school diversity, creating a one-size-fits-all approach that couldn’t meet individual needs.

Idea #3: Education Should Fit the Student

Friedman said, “A centralized system cannot possibly have that degree of personal concern for each individual child that we have as parents”. He believed that all students are unique and that education should reflect that. Students speak different languages, develop at varying rates, have diverse interests and passions, require different levels of support, and come from diverse home lives. Friedman thought that this difference should be reflected in the education system, and families should have options for schools that best fit their children’s needs. The one-size-fits-all approach may work for baseball caps, but it doesn’t work for educating the next generation. School choice allows families to send their kids to the schools that best fit their needs not the needs that the government decides.

Idea #4: Free Markets Can Improve Schools 

Friedman believed in free markets. He believed in allowing supply and demand to determine the prices of goods and services in society with little to no government intervention. He argued that this system promotes competition and innovation as businesses and organizations are incentivized to respond to consumer preferences. He took this way of thinking to his educational work as well. The free market system creates efficiency equally, regardless of the differences that often lead to biases and unfair systems.  Friedman said, “The most important single central fact about a free market is that no exchange takes place unless both parties benefit”. If a school produces an education that is beneficial for students, then students will attend; if a school does not produce an education that is beneficial, then the students will leave.  Limited government intervention in the schooling system allows schools to compete against each other, fostering innovation and improvement through competition.

Idea #5: Economic Freedom Supports Personal Freedom

Friedman’s economic philosophy placed personal freedom on a pedestal. He believed that giving people more control over their economic decisions would allow for greater personal responsibility and independence. Through this way of thought, he saw a direct connection between economic freedom and personal freedom. He often applied his economic ideals to other aspects of his life, like education.

Friedman believed there were four ways to spend money. When a person spends their own money to buy something for themself, they are cautious about the amount they spend and what they are spending it on. When a person uses their own money to buy something for someone else, they are still careful about how much they spend, but somewhat less careful about what they are spending it on. When a person spends someone else’s money on themself, they are careful about what they are spending it on but are not as concerned with how much they are spending. When a person spends someone else’s money on something for someone else, they don’t care about how much they spend or care about what it’s being spent on.

When it comes to education, the government spends taxpayer dollars on the children of the taxpayers. They are not concerned with how much they are spending or what is being spent on. When the parent spends their dollars on their child’s education, they are both concerned about how much they are spending and what it’s being spent on. Giving parents and students the freedom to choose a school creates a more thoughtful system of how much the family is spending on education and how the money is being used. Friedman’s ideas remind us that freedom in one area of life can foster freedom in others, such as education, helping to shape responsible and independent individuals.

Why Friedman’s Ideas Matter Today

Milton Friedman’s economic and educational ideals continue to shape debates on school choice and educational reform. His passion for empowering families and creating competition in different markets challenges us to reevaluate how the school system can better serve students. As we look back on Friedman’s legacy, his ideas should inspire us to challenge the current system, ensuring that every student has the same opportunity to succeed in their K–12 experience.