I think Friedman’s statement about intellectuals needs to be qualified. I assume he is referring to left-wing intellectuals with some grounding in Marx.
What are/were the arguments for central planning? Was it just some idea about a benevolent state, etc? No, Marx correctly observed what he called the anarchy of production under capitalism.
It goes like this: you have a number of producers (for simplification let’s say they sell shoes) who put their goods out on the market. There are only so many people who need shoes and so some of the shoes will not be sold, workers laid off, etc. In addition, if workers are laid off, then they will have no spending power and so this will further add to the crisis because now there would be fewer people to buy the goods the producers are creating. Of course, some of the producers will do well and will invest capital in better technology and lay off more workers and while it may help them in the short run, it further increases the crisis.
It was thought that central planning could do away with the anarchy of the marketplace by having “rational” planned productivity.
Of course, this scheme was first hatched in the 19th century, the hight of mechanistic rationalism. Chaos/complexity theory did not exist yet and nobody thought about the impossibility of being able for a central body to plan every detail of the economy. Of course, when the Soviet Union was born, there was a finally a chance to put the plan into place…Then the problems with central planning became evident.
I post this because a lot of criticism of marxist central planning have this idea of it being based on idealism. It was not. It was based on trying to fit the economy into a rational paradigm (the existing paradigm of that age), when in fact the market is chaotic.