Milton Friedman on Gambling

Milton Friedman on Gambling

CARD DEALER: Cards are coming out now, high
wager players saying they have…
(poker chips clicking, background conversation)
FRIEDMAN: When the evening started, all of
these players had about the same number of
chips in front of them. But, as the play progressed
they surely didn’t, some won, some lost.
By the end of the evening, some of them will
have a big pile of chips, others will have small
ones. There’ll be big winners, there’ll
be big losers. In the name of equality, should
the winnings be redistributed to the losers,
so that everybody ends up where he started?
That would take all the fun out of the game.
Even the losers wouldn’t like that. They
might like it tonight, but would they come
back again to play if they knew that whatever
happened, they’d end up exactly where they
had started?
(roulette wheel spinning)
(background music and casino noise)
But, what does Las Vegas have to do with the
real world? A great deal more than you might
think. It’s one very important part of our
life in highly concentrated form. Every day,
all of us, are making decisions that involve
gambles, sometimes they’re big gambles as
when we decide what occupation to pursue,
or whom to marry. More often, they’re small
gambles as when we decide whether to cross
the street against the traffic.
But each time, the question is: who shall
make the decision, we or somebody else? We
can make the decision only if we bear the
consequences. That’s the economic system
that has transformed our society in the past
century and more. That’s what gave the Henry
Ford’s, the Thomas Alva Edison’s; the
Christian Barnard’s the incentives to produce
the miracles that have benefited us all. It’s
what gave other people the incentive to provide
them with the finance for their ventures.
Of course, there were lots of losers along
the way. We don’t remember their names,
but remember they went in with their eyes
open, they knew what they were doing, and
win or lose, we society, benefited from their
willingness to take a chance.

9 thoughts on “Milton Friedman on Gambling”

  1. I have a hard time believing that there could be something that is more anti-freedom. Then some government telling people what they can and can't do with their money. Unless they are using their money to hurt innocent people.

  2. To those that may be confused, Friedman did not compare the economy to a casino, but rather point that, like gambling, without wining there is no point in playing. Incentives plays a very important role and free market "harness" these incentives and direct them to the satisfaction of human desire.

  3. Of all this is the best Friedman Video. Nobody can explain libertarianism in such a short and crisp manner. Proud to be a hayekian and a conservative libertarian!!!!!!💐

  4. What about moral luck? There must be some deeper evolutionary reason for socialism/communism? Agree with libertarians but the "reality" is bit different? Medicare, Social Security, Federal Reserve and the Pentagon all seem to be headed toward bankruptcy? 2019, Roll the dices…

  5. I realise he is using it as a illustrative purpose, but to compare Gambling to everyday decisions and making decisions in business is far from correct.
    You get no return from Gambling, if you dont win, you walk away with nothing, its irrationale to spend your money on it. When you make a risky but still rationale business decision you still end up with a asset, or something that you take from it, its rare to spend your money and not get something in return.

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