Milton Friedman views inflation as a government-created disaster

Milton Friedman, a prominent economist, consistently emphasised that inflation results primarily from government actions, particularly the excessive creation of money without corresponding increases in production. 

He famously stated that "inflation is always and everywhere a monetary phenomenon," underscoring that it stems directly from government mismanagement.

In a 1974 keynote speech, Friedman argued that governments often shift blame for inflation onto external factors like greedy businessmen, trade unions, and consumer behavior. 

However, he contended that these entities cannot cause inflation because they do not control the money supply. 

According to Friedman, the government's ability to print money is the true source of inflation, making it a problem of governmental origin.

Friedman also criticised price controls as an ineffective solution to inflation, describing them as popular but ultimately harmful policies that worsen economic issues. 

He pointed out that price ceilings lead to shortages by making it unprofitable for producers to sell goods, thereby reducing supply and creating inefficiencies. 

Historical examples, such as the U.S. government's attempt to control oil prices in the 1970s, led to gas shortages and long lines, demonstrating the failure of such interventions.

Additionally, Friedman highlighted the disastrous effects of price controls in socialist countries, where these measures contributed to hyperinflation and severe shortages. 

He argued that the free market is the best mechanism for setting prices, as it allows for adjustments based on supply and demand, ensuring efficient resource allocation. 

Government-imposed price controls disrupt this natural process, leading to economic downturns and harming the most vulnerable populations.

Friedman's theories suggest that inflation is a government-created issue and that efforts to control prices are counterproductive. 

He warned that policies like those proposed by Vice President Kamala Harris could lead to economic instability, shortages, and inefficiencies, similar to what has been observed in other nations with similar strategies. 

According to Friedman, the solution lies in reducing the government's role in the economy rather than trying to control prices.