Frank is at his best when describing the free market’s imperfections, which pro-market economists sometimes prove reluctant to acknowledge. He is at his worst when he idealizes government: all of his proposed solutions rely on the supposed efficiency and neutrality of the state. The “common sense” that he appeals to ought to tell him that this is an unbalanced view. Deregulation may indeed generate some negative outcomes, for instance, but regulation has brought plenty of unintended negative consequences as well. Starting in the late 1970s, the U.S. opted for deregulation because regulation was suffocating the national economy. ...
Are Europeans happier than Americans? When Frank visits France, he told me, he enjoys the public transit and nearly free health care. Being an economist, he should know better: the collective services he uses when he visits France are paid for (heavily) by French taxpayers. As a consequence of high taxes, the French get their high-speed trains—along with slow economic growth and a level of unemployment unheard of in the U.S. In the end, economics always imposes trade-offs. To pretend that one can have socialized benefits and economic freedom, and be happy on top of it all, is naive liberalism—or an ideological construction.
Tuesday, June 16, 2009
Sorman explains how Frank gets it wrong in this City Journal article. Here's an extract: