‘You can't tax businesses’: Elon Musk shares economist Milton Friedman's ‘wise words’

Tech billionaire Elon Musk, who is set to join Donald Trump's administration, recently shared a video of late Nobel Prize laureate Milton Friedman discussing America's social security program.

The Tesla CEO shared the video with the caption, “Wise words from a true genius.”

Friedman touched upon various topics in the video, from the government taxation system to its impact on inflation. He also made a few references to the impact of government social security plans on the public.

“Government is a fiction where everybody believes that he can live at the expense of everybody else. And that is the free lunch myth. The myth that somehow or other government can provide goods and services can spend money at nobody's expense,” Friedman said in the video shared by Elon Musk.

"Can you tax business? What's business? There's no business to be taxed. There are people. Only people can pay taxes, can I tax this floor can I tax the building. The building can't pay taxes. Only people can pay taxes. So when you talk about a tax on business, it has to be paid by somebody. Either it's paid by the stockholder or it's paid by the customer or it's paid by the worker. There's no other way it can come from. No, there's no Santa Claus. No tooth Fairy,” Friedman added.

Milton Friedman's Free Lunch Myth theory

Milton Friedman's “free lunch myth” is also mentioned in several of his books, where he criticised the idea that government programs or policies can provide benefits without any cost.

Just like in the video shared by Musk, Friedman had earlier used the phrase “There’s no such thing as a free lunch” to explain his idea. Friedman used the phrase to highlight that every benefit or resource which is provided “for free” comes with a hidden cost, which is often born by someone, in the form of taxes, inflation, or reduced economic efficiency.

It is not the first time when Musk has shared Friedman's video to prove his stance on free-market principles, deregulation, and privatisation. Earlier, he had shared another video of the famous economist's video in which he was blaming inflation on ‘too much government spending.’ Friedman was a staunch supporter of free-market policies, capitalisation, market deregulation, etc.