A long-time and very astute correspondent, Felix Finch, was inspired by my recent post on the folly of retaliatory industrial policy to send to me the following e-mail (that I share with his kind permission):
This new penicillin sure is great, but the other hospitals are still using sulfa powder. We must switch back to stay competitive!
Our new Boeing 707 jets cross the Atlantic faster than ever before, but our competitors still use Douglas DC-7 prop planes. We must switch back ourselves!
These Arabic numerals sure make calculations easier, but the bank across the street is still using Roman numerals. We must switch back!
Although industrial policy – the empowering of politicians and bureaucrats, and the ‘experts’ who are consulted, to coercively override the peaceful commercials choices of millions of individuals spending and investing their own money – is widely regarded as “progressive” and ‘scientific,’ the reality is that industrial-policy proponents are no more enlightened than are believers in voodoo and faith healing. Industrial policy is regressive.