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His political philosophy extolled the virtues of a free market economic system with minimal intervention. were Jewish immigrants from Beregszász in Carpathian Ruthenia, Kingdom of Hungary (now Berehove in Ukraine). Shortly after Milton's birth, the family relocated to Rahway, New Jersey.
In his early teens, Friedman was injured in a car accident, which scarred his upper lip.
Later, Friedman and his colleague Anna Schwartz wrote A Monetary History of the United States, 1867–1960, which argued that the Great Depression was caused by a severe monetary contraction due to banking crises and poor policy on the part of the Federal Reserve.
He helped to invent the payroll withholding tax system, since the federal government badly needed money in order to fight the war.