A Confused Review of Sam Gregg’s ‘Next American Economy’

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This letter to the Claremont Review of Books is the first of two that I will write. Pilkington’s review is a whirlpool of confusion.

Editor:

Philip Pilkington’s review (“Protecting the Free Market,” Spring 2023) of Samuel Gregg’s The Next American Economy is confused and confusing. For example, some readers of the review will take Mr. Pilkington to believe that Mr. Gregg, by recognizing a national-security exception to the case for free trade, is insufficiently aware that politicians will inevitably abuse their powers to impose protectionist measures. Other readers will be left with the sense that Mr. Pilkington thinks that Mr. Gregg, by refusing to abandon free trade in favor of industrial policy, is insufficiently aware of the wonders that can be worked by politicians who are given more power to impose protectionist measures.

Having myself read The Next American Economy, I can attest that Mr. Gregg is not naïve about the former, and perfectly justified about the latter.

Mr. Pilkington’s own case for industrial policy is ironic. Inaccurately suggesting that Mr. Gregg’s case for free trade is grounded in unrealistic “island fantasies” – that is, simplifying assumptions about Robinson Crusoe and Friday – Mr. Pilkington himself falls for the fantasy that politicians will have both the incentives and the knowledge necessary to impose tariffs and dispense subsidies in ways that will improve America’s economy.

I challenge Mr. Pilkington to explain why the same politicians who he correctly recognizes cannot be trusted with power to impose protective tariffs for national-security purposes can be trusted with this power for other purposes. I challenge him also to explain how politicians and their bureaucratic minions will get the detailed knowledge they would need in order for their industrial policy to work as fantasized.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030

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