In F.A. Hayek’s 1988 book, The Fatal Conceit, the economist explained, “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” Unfortunately, writes Veronique de Rugy, politicians of both parties today imagine they can design quite a lot by successfully managing the nation’s health care, trade, and energy production, among other herculean tasks.
The recent push to centralize more of the economy—think about “Medicare-for-all” or “Buy American” requirements for infrastructure projects—comes even though we are still discovering all the ways in which prior efforts to direct economic activity have backfired. Consider the case of the Public Utility Regulatory Policies Act of 1978. This program within the Federal Energy Regulatory Commission is still causing headaches today.
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