Professor John H. Cochrane, Myron S. Scholes Professor of Finance at the University of Chicago's Graduate School of Management, beautifully attacks--I believe the preferred word in some quarters is "deconstructs"--the Milton Friedman Institute Protest letter. You'll just have to read it; no excerpt can do it justice.
I will, however, repeat this nugget from Prof. Cochrane:
(By the way, I got the letter from Jodi Cohen, who wrote the Chicago Tribune story. The organizers of this petition carefully did not to send it to faculty at the economics department or business school, nor to the members of the faculty committee on the Friedman Institute. Infer from that action what you will about their actual views of the value of open discussion, listening to other points of view, and professional ethics.)
(Link via Megan McArdle.)