"History suggests that capitalism is a necessary condition for political freedom. Clearly it is not a sufficient condition."
Milton Friedman (1912–)
The influence of free-market economist Milton Friedman is due to his stature as a leading proponent of the theory of monetarism. The theory holds that business cycles are determined primarily by money supply and interest rates rather than government fiscal policy. His theories first attracted national attention in the 1970s, when the combination of inflation and stagnant economic growth — stagflation — undercut the dominant Keynesian policies of the postwar decades. In recognition of his work on the role of monetary policy in the analysis of the course of business cycles and inflation, Friedman won the 1976 Nobel Prize in economics. An advocate of personal liberty, free markets, deregulation, and reduced government intervention in the economy, he has seen his ideas on issues as Social Security privatization, welfare reform, and school vouchers become part of national political debate. He advised U.S. presidents Nixon and Reagan, and U.K. prime minister Margaret Thatcher, who enthusiastically applied his theories of monetary control and governmental nonintervention to the ailing British economy in the 1980s.