The word "policy" sounds reasonable, prudent, sober, adult. But it’s dangerous. It suggests that the State should always act, and is competent, and will choose the best policy, and is honest, and would never take a bribe from, say, Eike Batista. The State can solve every problem, like a sweet and all-powerful Daddy.

In my own country people lament "gridlock," when the Congress is controlled by one party and the presidency by another, meaning that little can be done. Sometimes that’s bad—it certainly was in the U.S. and Brazil when a quick reaction to covid 19 was a good idea. But sometimes the best policy is no policy.

For example, the best policy about foreign trade is none. Let people buy where they wish. The Brazilian maker of pesticides or trucks who is hurt by having to compete with cheaper goods from France or Argentina. He wants a policy of protection, protecting himself and damaging all other Brazilians. Not nice. Or again, the best policy for the money supply is none. The State should not have a monopoly over money, no more than over food or housing.

In the year 1681 the chief economic policy maker to Louis XIV asked the businessmen of France what the State could do for them. The immortal reply came, "Laissez nous faire," "Let us do it."

Some economists very fond of policy will tell you that laissez faire faces many "imperfection," such as monopoly or externalities or consumer irrationality or chronic short sightedness. They also say that the State has no such imperfections. The Nobel prize winners in 1970, 2001, and 2017, Paul Samuelson, Joseph Stiglitz, and Richard Thaler, all said so. In the Age of Policy run by economists over the past century, over one hundred imperfections have been proposed. Almost all of them have not been shown to be large enough on the national level to justify large interventions even by a perfect State. Enterprise monopoly, for example, as distinct from the numerous monopolies created by the very State, has not been shown to be large enough to justify ill-advised policies of antitrust.

So grow up,, dears, and stop thinking of the State as Daddy. Some problems can’t be solved. And most solutions are best left to nous.

Deirdre Nansen McCloskey
Distinguished Scholar, Isaiah Berlin Chair in Liberal Thought, Cato Institute

Distinguished Professor Emerita of Economics and of HistoryProfessor Emerita of English, and of Communication
University of Illinois at Chicago