As numerous commentators will point out today, Milton Friedman, who just passed away, was probably one of the two most influential economists of the last century, along with Keynes. Along with F.A. Hayek, Friedman also played a key role in rescuing libertarian and classical liberal political thought from the intellectual oblivion that threatened to engulf it in the period from roughly 1932 to the late 60s. Without Friedman and the scholars he influenced, it is possible that big government conservatism would have become the only intellectually respectable alternative to the left in the wake of the Great Depression and World War II.
In addition to his more technical scholarship in economics, Friedman also invented an impressive range of public policy proposals, many of which remain relevant today. For example, his 1955 essay "The Role of Government in Education" introduced the idea of school vouchers, which recent studies show provide far greater benefits to poor and minority students than any other potential education policy reforms. Friedman was also a longtime proponent of the volunteer military on both economic and individual rights grounds. The abolition of the draft in 1971 was partially a result of his advocacy and its influence on political conservatives (most of whom previously were inclined to support conscription). Other influential Friedman policy ideas include the negative income tax (on which today's earned income tax credit is partly based), and - of course -the monetary rule. Somewhat unfortunately, Friedman (at that time still a left-winger) also invented the idea of income tax withholding while working as an economist for the the Treasury Department during World War II. Although Friedman intended it to be a temporary wartime measure, it soon turned into a permanent expansion of government power - a result that the later, libertarian Friedman would surely have predicted:)!
On a more personal note, reading Friedman's book Capitalism and Freedom when I was 14 (recommended by my father) was one of the key influences that led me to become a libertarian. Along with Friedman's later book Free to Choose, it remains the best introduction to libertarianism written for a general audience. Even 45 years after initial publication, it is still highly relevant, with very few sections that today seem dated.