Institute Controversy
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** Consider signing the petition in support of the Milton Friedman Institute. **
What is the Milton Friedman Institute?
Proposed in early 2008 by the faculty, the Milton Friedman Institute (MFI) is a collaboration between the University of Chicago’s Law School, Business School, and Department of Economics. The interdisciplinary institute would include student and faculty support, resources for visiting scholars, and collaborative workshops and seminars, all funded by individual donors. It is intended to serve a similar function as University research centers at other top-ranked institutions.
What research centers would MFI be modeled after?
The institute’s proposal names several model academic centers, specifically: SIEPR at Stanford, Cowles at Yale, Institute for Fiscal Studies at University College at London, and NBER near Harvard at MIT. Although the University of Chicago has more economics Nobel Prize and John Bates Clark Medal winners than any other university, right now it oddly lacks an economic research institute.
What will be the institute’s focus?
As this is the University of Chicago, the institute proposal naturally states that their research would use the Chicago School as a focus:
The intellectual focus of the institute would reflect the traditions of the Chicago School and typify some of Milton Friedman’s most interesting academic work, including his seminal work on the permanent income theory of consumption, his critical analysis of monetary policy, and his advocacy for market alternatives to ill conceived policy initiatives.
Who opposes MFI, and why?
In June, a group of Chicago faculty published a petition opposing the MFI, citing concerns about the Chicago School’s academic credibility and that MFI would push this agenda. They state that liberalizing economies, as recommended by the Chicago School, was:
negative for much of the world’s population, leading to the weakening of a number of struggling local economies in the service of globalized capital, and many would question the substitution of monetization for democratization under the banner of “market democracy.”
Although rather vague, these are still are heavy allegations. We feel that the historical record is exactly the reverse, and encourage you to read more and decide for yourself.
What does the Chicago School say?
We certainly cannot speak for the entire diverse Chicago school of economics. Again, we encourage you to learn what this is, what it proposes, and read about its historical record for yourself.
Will MFI promote the Chicago School?
Milton Friedman was a rigorous economist and statistician. His work on price theory, the consumption function and his permanent income hypothesis, his discoveries in statistics including the Friedman Test and sequential sampling, along with his investigations into economic history, forever changed the fields of economics and statistics. His work was ground-breaking and revolutionary. And not necessarily ideological. Many scholars of various political stripes work on the various fertile topics he and his Chicago School colleagues created. The Chicago School is a methodology, a lens through which to analyze phenomenon, not a set ideological agenda to be “promoted.”
It should be noted that researching a topic’s efficacy, and professing ideological commitment to that topic, are very different things. Indeed, the institute’s founding committee and the University President have publicly made clear, in writing, that the institute will not pursue an ideological agenda.
Would MFI stifle debate on campus?
On the contrary. MFI will bring renowned visiting scholars from around the world to enhance the academic environment. Its seminars and workshops, which would be open to anyone interested, would bring new and diverse ideas to campus.
We encourage you to read this report on academic diversity (PDF), which indicates that on average liberals outnumber conservatives 15 to 1 in academic departments. The number is higher in some departments, such as 30 to 1 in anthropology and 28 to 1 in sociology. So, even if CORES were correct that MFI is a veil for promoting conservative ideas – which seems incorrect – would that not enhance diversity?
Won’t the MFI take funds away from other projects on campus?
According to the University of Chicago’s press release on the Institute:
The University’s investment in the Institute will be about $200 million, with half of that amount establishing an operating endowment and the remainder allocated for facilities and other start-up costs. The majority of the funds will be raised in donations from alumni and business leaders around the world.”
It’s true that half of initial investment will come from the University, which boasts a more than 6 billion dollar endowment. The other half of the start up funds, will come from donations specifically for MFI. Importantly, donations that would not come in otherwise.
Couldn’t that $100 million be better used elsewhere?
The Friedman Institute is expected to bring in a great deal of investment from donors, money that would not come to the University otherwise. Without MFI, there wouldn’t be anywhere near the millions that will be raised to do anything with. Other departments will likely benefit monetarily from this initial fundraising effort; that is the way these things usually work. However, without MFI, there won’t be all that money to spread around. The same likely goes for future MFI fundraising efforts.
Won’t Friedman’s bad reputation harm liberal-leaning fundraising efforts at the U of C?
CORES has suggested this. We should first point out that Milton Friedman’s reputation is generally favorable, rather than universally “bad.” Second, most educated guesses about how Friedman’s reputation will impact fundraising are positive.
In fact, it may just as easily increase donations directly to the concerned liberal-leaning departments, which could be done easily by telling donors how needed departments such as anthropology or sociology are now on campus. In addition, if they can raise the money the University would heartily welcome other research centers. In fact, President Zimmer has encouraged this idea in a response letter to CORES.
The effects of other institutes, such as the Hoover Institution at Stanford University, may be illuminating. As Hoover is rather ideological, and MFI claims it will not be, one would project more drastic difficulty on the part of Stanford’s liberal-leaning departments to recruit donors than we could predict with MFI. Yet Stanford, it seems, is thriving and certainly not marred by Hoover. That is good news for both sides of this debate.
