Dr. Samuel Gregg is a distinguished fellow in political economy and senior research faculty at the American Institute for Economic Research. He recently wrote a book called The Next American Economy: Nation, State, and Markets in an Uncertain World.

We talk about the current consensus about the American economy and how it’s changed over time. He explains to us the renewal of enthusiasm for industrial policy, and what classical liberals can do to better the defense of free markets.




Want to explore more?
Kevin Lavery's Great Antidote Extra on Samuel Gregg on The Next American Economy
Brent Orrell and David Veldran review The Next American Economy at Econlib.
Samuel Gregg, Trade, Nations, and War in an Enlightened Age, at Law & Liberty
Is Globalization in Retreat? A Conversation with Samuel Gregg at Law & Liberty
Murray Rothbard, Free Market, in the Concise Encyclopedia of Economics

Juliette Sellgren 

Science is the great antidote to the poison of enthusiasm and superstition. Hi, I'm Juliet Srin, and this is my podcast, the great antidote names for Adam Smith, brought to you by Liberty Fund. To learn more, visit www.adamsmithworks.org. Welcome back. Today on April 6th, 2023. I'm delighted to once again invite Dr. Samuel Greg, a distinguished fellow in political economy, and a senior research faculty at the American Institute for Economic Research. Last time he came on this podcast, we explored liberalism and Christianity, but today we're going to be talking about his most recent book, the Next American Economy. Welcome back to the podcast,

Juliette, It's great to be with you. Thanks for having me on again.

So, The Next American Economy, that's, it's a big statement, but before we get into that, what is the most important thing that people my age or my generation should know that we don't?

I think maybe the most important thing that people of your generation should know is that no intellectual discipline stands alone. That it's really important, even though specialization is a significant part of learning today, especially when it comes to equipping yourself for a job, for example, I can't emphasize enough the worth of understanding how different disciplines relate to each other, reinforce each other and reveal new forms of knowledge that wouldn't happen if interdisciplinary work was not being undertaken. So if you are studying something like economics or political science or philosophy, it's good to know that these disciplines don't exist in silos. They have their own significance, they have their own competence, but it's nonetheless important to understand that in different ways they do and should draw upon each other. If we're seriously interested in knowing more about the truth.

Shout out to the liberal arts education!

Liberal arts education, but really anyone who's, who's, who's in college, I, I would encourage them. Obviously specialization is going to come at some point. People have to declare majors, or if they go on and do graduate work and doctoral work, they have to make choices about relatively narrowly defined topics that they're going to pursue. But none of that's a reason for giving up on learning about other things. And it's one of the problems at the academy today is that you have a lot of people, you know, an enormous amount of information about a very small piece of intellectual inquiry and nothing about anything else. And that's a problem.

This is a problem that I've been running into because obviously if I wanna go to grad school, I have to choose something. But yes, I don't really want to <laugh>. I kind of want a PhD in everything.

<laugh>. Well, uh, such things except Physics, <laugh>, such things are not quite what, uh, that type of study designed to, to elicit. But you can go on and do higher degree studies and nonetheless continue to learn about things that often have very little to do with whatever your particular narrowly defined field of inquiry is. In fact, when I was at college, when I was doing my doctorate, I made a point of going to lectures and seminars that had nothing to do with my own particular area of inquiry. And that was partly because I needed to be stimulated to think about other things and my doctoral thesis. But also it was just an opportunity that often doesn't come along in life to learn from some very intelligent people about areas of inquiry that you perhaps don't know very much about.

I should act on this more frequently than I do <laugh>. Thank you for that advice. It's good. Um, alright, so industrial policy. Why did you feel it was so important to write a book about industrial policy challenges to free trade, end of free markets now?

Well, I begin the book by talking about how I was at a conference in London in 2016, just after the election of Donald Trump as United States President. And that election made it very clear that many assumptions about things like trade or industrial policy that seemed to have achieved the status of an Orthodox scene on the political right, but also on parts of the political left were no longer orthodoxies. And in fact, I was on a panel with, uh, a number of people and I was sitting next to a French economist who happened to be who happens to be your mother. And she turned to me and she said, well, I guess free trade. I thought free trade was a done deal. Turns out that it's not. And from there on, we saw an acceleration of skepticism on the left, but also on significant parts of the right about what had been commitments across the political spectrum, really from the 1980s onwards to the power of markets and acknowledgement that governments were not always good at doing lots of different things.

These orthodoxies were now under siege in America and around the world, and that a lot of people who describe themselves as free marketers or classical liberals or limited government conservatives were struggling to provide answers because the answers that were required were partly economic. But they also needed to go beyond economics because many of the questions, many of the doubts that were driving the skepticism about markets and limited government and these sorts of things, they weren't just being driven by economic dissatisfaction. They were being driven by cultural dissatisfaction, concerns about particular elements of foreign policy concerns that parts of America were being neglected, that particular social groups had not benefited from expansion of markets, economic globalization, the relative pushback on things like welfare states, et cetera. And so that had been going on for quite some time. And I found actually really before, um, Trump was elected president basically in 2015, I found myself being pulled into these debates partly because a lot of free marketers in my experience, struggled to provide answers that went beyond economics.

And part of the answers to these questions are economic, but they also require reflection on culture, deeper ethical matters that require addressing. And economics in itself can't do that. You need political economy to answer those sorts of questions. So that's why I thought it was very important to write this book, which in many respects summarizes many of the thoughts I've had about these subjects for quite some time. But I also wanted to make it clear that free marketers needed to repackage their arguments that we're not living in the 1980s anymore. We're living in the 2020s. Some of the foreign policy challenges are different, the economic context is different. Some of the domestic cultural and political challenges we face are different. And free marketers need to articulate the same truths that they have been articulating for a long time, but packaged in a different way and cognizant that if you're going to persuade people that protectionism is bad or industrial policy is wrong, or things like stakeholder capitalism are not really good options for America, then you needed to show people why these things were good for America.

Because I think much of the free market argument got wrapped up in arguments about sort of one world global community. Some of these arguments were wrapped up in, uh, a type of disdain for nations and nation states. And all those things are very counterproductive today if you're trying to embrace and promote the case or markets. As I said, it doesn't mean giving up on the economic truths or the political truths or any of these things associated with the classical liberal free market, limited government agenda. But if you are selling these messages, you need to know where your audiences are. And the audiences today are not in the same place that they were in the 1980s and 1990s.

So can we talk about the title for a minute? I mean, the American economy, I mean, we'll get into talking about that, but it's delivered a remarkable growth and innovation and wealth to Americans. Um, and while it hasn't performed as much as we may have liked it to, we can point to cronyism. So what's the next American economy?

Well, my book basically argues that we have two paths that we can broadly follow. One path, which I'm not in favor of, is the expansion of state power into the economy with the objective being to use state power, whether it's through tariffs, whether it's through particular types of regulations, whether it's industrial policy, using the government to try and deliver different outcomes in particular segments of the economy than would otherwise be delivered by markets. That implies a type of top-down direction of particular segments of the economy. That implies trusting the federal government to do certain things and the way that they say they're going to do certain things. That implies accepting that you're going to have significant diminution of liberty, not just economic liberty, but other forms of economic liberty.

And that's one path. And there's a significant number of people on the right and on the left want America to go down that path in terms of its economic future. Political representatives of these positions would be people like Senator Elizabeth Warren from Massachusetts, liberal Democrat, but also Senator Marco Rubio, conservative Republican from Florida. If you look at some of their economic ideas and preferred policies, despite the fact they disagree about lots of things, they are getting close to being on the same page when it comes to their economic vision of the future. So that's one path that I think is open to America, and that's certainly the path we're drifting down now, drifting, but also being nudged as well. The other path is for America to re-embrace a commitment to dynamic entrepreneurship, competitive markets, free trade that's cognizant of geopolitical realities of our time, all of which I think needs to be wrapped up in a particular normative message of what America is supposed to be.

And that is the part I think America should pursue. And I try and show in the book why this is not just economically better, but why it's also a question of America and Americans being faithful to its roots and to who we are as Americans and who we are as Americans. I think it's very much wrapped up in the ideas and documents and figures of the American founding, and that I think is the way that you legitimize markets, dynamic markets, very competitive markets and dynamic entrepreneurship and a very positive view of free trade. That's the normative message I think these things need to be dressed up in, and that is not the path we're going down right now, but it's the path I think America should take when it comes to what America's economic future is going to be.

So, I mean, I haven't been alive for that long, big, big whoop. But, from what I've read, from what I've heard from what everyone is saying, even though for my whole life there has been basically no consensus about anything except for maybe the fact that the economy isn't delivering and that we need the state to fix it, there seems to have been a point in time when at least some people believed that the economy was delivering and there was some idea that the American economy did actually produce results we liked. So I guess what caused this shift and when did it happen?

Well, I think it's fair to say that after the Second World War, the world goes down. Um, certainly the western world goes down more or less a Keynesian path in terms of its thinking about economic policy, but also it's thinking about political economy, the types of values that people thought the economy in economic life and generally should reflect. And of course, the Keynesian model, the Keynesian ideas presuppositions and value commitments started to come under questions, severe question in the 1917s, partly because it was just obvious that these, this, these arrangements were not delivering. We had high unemployment, we had high inflation, we had stagflation, and there was a lot of disenchantment where the, the idea that the state can be used to deliver economically in the 1980s, there's a major shift certainly at the level of rhetoric and even to a certain degree in terms of policy through throughout the western world.

There's a turn towards markets different ways and to different degrees, but even many center left governments were embracing the idea that there were limits to what the state could do, that maybe Keynes had got some things wrong, and certainly his disciples had got even more things wrong. And as a consequence of this shift towards markets and away from more or less Keynesian arrangements, we saw considerable economic growth taking off across the world. And as the world started to become more integrated economically, especially as protectionism faded in importance and its application to so many major economies around the world, there was tremendous optimism in the 1980s and 1990s that the economic argument was over, that free markets had triumph, that growth was going to continue at much higher levels, that inflation was going to be under control, that unemployment would be dropping in those countries that had embraced these things.

And that was a very powerful and successful set of circumstances. I I, I was a child in the 1970s, I remember as a very little boy being told about my parents by my parents how bad inflation was and what it was doing to the economy. And then in the 1980s and 1990s when in school and then in college, there was definitely a sense that things had changed for the better. So this is before your time, but it was a very different time. People were very optimistic, economically optimistic about the world. And this positive view of markets and positive view of economic liberty wasn't just something that was articulated by the political right. There were plenty of people on the political left who had very similar views. People like Tony Blair or Bill Clinton were what we would, what would be described today in derogatory terms as having a very quote unquote neoliberal view of economic life.

And I think that was a vision that that pervaded despite the fact that there were recessions at different points in the western world during this period. But I think what really started the process of damaging the case for markets and generating skepticism and doubt about the benefits of markets was the 2008 Financial Crisis. Now, I could give you, and anyone who's listening thousands of reasons why I think the financial crisis was for the most part a consequence of government meddling in the housing market, excessively low interest rates set by central banks as well as severe mistakes made in banking regulation. And by which I mean too much regulation. But unfortunately, those of us who were free marketers, we lost that argument at the level of rhetoric and in the public consciousness. And that's when you start to see, I think much more skepticism starting to develop because this was portrayed as a failure of financial markets, a failure of the market economy, a failure of capitalism.

And of course a lot of people, including people of your age, have grown up in a period of time in which this skepticism and negativity about markets has only gotten worse. So I think that's, there was a period of optimism, and I try and explain in my book why I think that optimism ultimately fell apart when it came to markets. And here we are now, we, uh, western world has turned very much back to the state on the right and on the left when it comes to economic policy and how we think about the relationship between values, beliefs, political systems, and the economy that we all wrap up and call this area of political economy.

And in the book you present and criticize what you call state capitalism. Can you explain what it is and how it's different from what existed in the Soviet Union, a full-on central planning scheme?

Sure. So the phrase state capitalism has been used to describe many realities, and that ranges from the type of economic systems of a sort of social democratic nature that prevailed in Western Europe after the Second World War. Two things like that. Very short period of time in the Soviet Union when Lenin, realizing he needed to boost economic growth, allowed some degree of private ownership and competition in the economy while the state controlled the commanding heights of economic life. It's also been used to describe the type of economic arrangements that that operated in different parts of East Asia. But in the context of my book and the specific challenges facing the American economy, state capitalism is not socialism, state capitalism is not a planned economy in the way that that is commonly understood. State capitalism rather is the idea. You keep private property, you allow some degree of competition, you have a certain degree of economic freedom, but you also use the state to try and deliver different economic outcomes in particular sectors of the economy than would otherwise be delivered by markets.

We call that industrial policy in very, so you are basically trying to use the state to deliver different outcomes, but also even reshape the sectorial division of a given economy so that you shift workers capital towards particular sectors of the economy, even particular regions of the United States without completely abolishing private property, competition, trade, all these sorts of things. So it's not, as I said, it's not socialism. It, it could be described I suppose as a mild form of social democracy. And I think if you look at the United States economy today, we do have state capitalism, we have lots of industrial policy, there's lots of protection. Some, there are many people who look to the federal government in particular to try and shape the economy in particular ways that will benefit what they see as groups who have lost out in the globalization period that we underwent from the 1980s up until relatively recently.

So that's what I mean by state capitalism in an American context. And I mean, you can even go back further and say that this really started with the progressive era when you had, uh, Republicans and Democrats who very much wanted to use this state and the administrative state to reshape social life, but also economic life. It also reflects the state capitalism in America today reflects the legacy of the New Deal. It also reflects the legacy of the Great Society programs, all of which more or less conform to this model of state capitalism that I suggest is where America more or less is and where we are continuing to drift in which I think in the long term is not good for the United States economy, not good for America as a country, and represents a repudiation of the best economic instincts and outlooks and insights that we find in the American founding.

Well, it's interesting because it's almost, it's not a contradiction necessarily, but it's like an unstable equilibrium. I think. Like if you believe in private property and we all produce and have our private property, but the state knows how to do it better, I, it just doesn't seem like a sustainable idea. Like why don't you give everyone their private property or just take it all I <laugh>

I guess like, well, it's not sustainable because you are quite right. It's not sustainable because state capitalism produces even mild forms of state capitalism produces massive mis allocations of capital throughout the economy. It also means that the economy is not being driven by consumer needs and wants. It's increasingly driven by political considerations which don't conform or reflect market demand by definition. So you get dysfunctionalities starting to develop, you start to see as a, as I said, these massive dis misallocations of capital. You see economic efficiency inefficiencies start to develop throughout all different sectors of the economy. And you, you basically end up with what I call political markets whereby you maintain things like private property and competition and exchange and things like that. But everything is increasingly driven not by consumer wants and needs, but by political priorities. The problem with that is that political priorities at some point are going to introduce these types of inefficiencies into the economy, and we can, we can already see that happening in the United States today.

I would argue that it's, it's, it's a major drag on growth, for example. It also means we're encouraging people to go into forms of employment that basically rely upon the state propping up certain types, parts of the economy that, that no matter how much the state tries to prop 'em up, at some point they're going to become deeply uncompetitive. It means shutting down or trying to ignore comparative advantage. It means pretending that there aren't such things. It's trade-offs. It means that entrepreneurial instincts get shifted away from trying to produce new goods and services or revised and reformed or goods and services by entrepreneurs. Instead, entrepreneurs start thinking about how do I extract wealth from other people, what we call rent seeking. And that's all of those things taken together, lend themselves over time to deeply unhealthy economic arrangements. And the real, the other problem is, is the more we dig ourselves into that, the harder and harder it is to dig ourselves out because there are so many established interests now that have no interest in changing anything about the state capitalist status quo. That is becoming more and more an American reality today.

As Milton Friedman once said, the externality of government intervention is more government <laugh>.

It is, and

It's also something along the lines of that. 

Yes. And it's also the fact that what, what it also means is that the state gets distracted from performing those key responsibilities that say someone like Adam Smith said, were a responsibility of government such as protecting private property, right? Or maintaining rule of law, or doing what governments inevitably have to do when it comes to national security. The more they get involved in all these other things, the less proficient they become at performing these very, this small number, but nonetheless core responsibilities that people like Smith and others would say, yes, the state does need to do these things because these are, these are a type of public good that need to be secured by political action, but the more the government gets involved in all these other things that we've talked about, the less well it performs some of these other small number of other, but nonetheless important functions.

So then what are some of the best arguments you heard for protectionism and industrial policy and tariffs and what are your responses to them?

Well, in the book, one of the things I try to do, and in fact a number of reviewers have mentioned this, is that I try to give the best case for things like industrial policy or the best case for things like protectionism. And what's interesting about that is that the more you dig into the arguments that are being offered, you realize that not only are they trying to deny some economic truths that are well established through good economic theory, but also <laugh> careful attention to economic history and the lessons that we've learned from economic history, you quickly realize that something like industrial policy, which is usually presented in terms of we need this because this is a matter of national security, or we need this because we can't abandon particular segments of the population to decrepitude, et cetera. And that's how these arguments are usually presented.

They're presented in terms of this is necessary for the wellbeing of the country or the common good or the general welfare. Now, I don't doubt that there are some people who genuinely believe that, that these things are necessary for the common, so to speak. But the more you look at economic evidence and the more you look at good economic theory and the more that you pay attention to the lessons of economic history, it becomes very apparent that most of these things are not driven by a concern for the common go or the welfare of the United States or any, or even national security. I like to say behind every industrial policy, there is a small group of rent seekers who have managed to persuade or, uh, corrupt people into believing that somehow they need to be exempt from market competition. And I think one of the things one does in pushing back against protectionism industrial policy and all these ideas is to show that they one, don't achieve the ends that they purport to try and achieve.

Secondly, that they are driven by sectorial interest rather than a genuine concern for the wellbeing of the country. Uh, and thirdly that they do ignore important historical lessons about the folly of the government getting involved in the economy beyond these very basic functions that I just, uh, described. And it's very important, I think, to acknowledge that the United States does have some significant cultural problems right now, whether it's drug abuse, whether it's social dysfunctionalities that have been around for a while, which I would argue were actually exacerbated by things like Johnson, Lyndon Johnson's Creative Society program. It's important to acknowledge that these are not made up things. These are real things, but a tariff is not gonna get people off drugs. Industrial policy is not going to encourage people to get married and stay married <laugh>. Um, in other words, they're often arguing for economic solutions delivered by government programs to problems that actually have very, very little to do with the economy and have much more to do with deeper cultural and social dysfunctionalities that don't lend themselves to economic solutions.

So I guess, do you think that even though maybe they're misguided, maybe they've been persuaded by people with other interests that the renewed enthusiasm for industrial policy kind of points out some, some problems with the way that classical liberals have behaved and the way that we've defended free markets?

Yes. I, I, and I make that point in the book, right at the beginning, that it's not a question of free marketers giving up any of the truth claims that we make about the most optimal economic arrangements that maximize our opportunities for growth, the growth that feed so many other good things in America, including a lot of non-economic things, and that we don't give up the case for liberty, the case for limited government, the case for constitutionally constraining government. We don't need to give up any of those things. We shouldn't be giving up any of those things. But it does seem to me that free marketers did make some mistakes, not at the level of ideas, but certainly in the way that they talked about certain things. So for example, in the 1990s, the case from markets, for better or worse, got associated with these type of end of history arguments that we've heard being articulated by people like Francis Fukuyama and his book, The End of History, which sort of says that inevitably we're gonna end up with liberal democracy and free markets.

And it's really just a question of how we all get there. And I think that was a mistake. Cause that's a very deterministic argument. And I'm not a determinist. I do think that people, people, whether it's individuals or communities or even governments, can make decisions, choices, free choices for particular futures for particular goods. And you may not, you may disagree with the decision, you may think it's a bad decision, but, but people nonetheless do make choices. This is part of the quality and the benefits and the challenges of being free by nature, which I think human beings are. We can make free choices, no other creature can, we can know. And I think that when you go into the deterministic path, when you embrace these types of arguments, then I think you get lazy about making not just the economic case, but also the normative arguments for the free society and free economies as well.

And I think that was a mistake. I think we, a lot of free marketers for the inevitability thesis, and I don't think free markets are inevitable. I do think that governments and individuals can make choices for better or worse, for or against markets. I think also, a lot of free marketers were reluctant to engage some of the cultural issues that particularly many conservatives were getting worked up about and are still worked up about sometimes with good reason to be worked up about. And I think many free marketers, more or less adopted the position that they had nothing to say about some of these things. And I think in many cases they had many good things to say. And I'm surprised and still surprised that they didn't get involved in talking about some of these questions in a way that I think would have disarmed some of the conservative critiques that we're encountering now of the workings of markets.

Uh, another thing I think we, we, we free marketers needed to say more about, and what my book tries to say more about is that free marketers need to engage the political economy arguments more closely. Now there have always been, uh, free marketers who have done, but I think it's fair to say that a lot of free marketers drifted down the quantitative path, uh, and ceased to engage these questions in a serious and lasting way about these relationships between particular value sets and particular value commitments and the role of government and the nature of economic life that we think is good for people. And even using that word good, this is good for people not just in material terms, but it's good in non-material terms, in normative terms as well. And I think many free marketers, more or less abandoned that it didn't mean that they were, they'd become relativists.

It didn't mean that they had sort of ceased to believe that there is good and evil and there are normatively good things that we should do. And there are normative really bad things we should not do. It's more like they just sort of not stop talking about a lot of these questions. And if you go back to an older generation of free marketers, if you look at people like F A Hayek, and many of the people who were involved in the beginnings of the Mont Pelerin Society, they engage these types of normative questions at a great, uh, level of detail. That doesn't mean that they got everything right. I think in some cases, I think some of their, the type of philosophical arguments that they were bringing were not particularly good arguments, but they were engaging these arguments in a way that became less apparent.

I would argue in the 1990s and early two thousands. And even today, I think a lot of free marketers are reluctant to go beyond the strict disciplines of modern economics to talk about the ways in which political economy is in some respects, antecedent to some of these economic policy debates. So I, I suppose I'm arguing we need, we need more Adam Smith type thinking. Free marketers need to engage that type of thinking. Cause Smith certainly understood that making this case for the, for what he, what you might call the society of the civilization of natural liberty, has to go beyond economics. Smith was very good at that. A lot of free market thinkers in the 19th century and early 20th century were very good at that. That became a lot less apparent, I would argue, in the seventies, eighties, and nineties. And we're still, I think, playing catch up in that regard.

What's interesting to me is that as much as I love Adam Smith, obviously, um, I talk about Adam Smith a lot. I interview a lot of people about Adam Smith. The podcast is named for Adam Smith. I mean, first he was great, right? But it's funny that in a way he's still the image of what the political economist should be, um, and that we haven't really had an Adam Smith type or someone that argues in a way, the way that he does or builds an understanding and a diagnosis of the world around him the way that he did. Right. And you'd mentioned this earlier, and you talk about this in the book, that classical liberals need to develop arguments for the 2020s mm-hmm. <affirmative> that kind of look more like that than what we have been doing. So I guess, what does that look like?

Well, uh, Smith is obviously the model that a lot of us look to, but there are other people. So Hayek, I think, uh, was very much a political economist along these types of lines. And again, it doesn't mean that you necessarily agree with everything Smith or Hayek said about, uh, some of these issues, but they nonetheless understood the importance of, of doing that. So what does it look like today? Well, I think in the one level it involves noting the limits of economic policy, not in terms of its importance. It's obviously crucially important, but there are limits to which it can make the case for a society that takes liberty, rule of law, limited government. Seriously, it can do a lot, but it can't do the whole thing, which means I think we need to be making the case for why liberty is important in a way that goes beyond choice for the sake of choice, which is what I sometimes see in some parts of the free market world.

Choice is very important, but it's really important what you choose as well. I think another thing we need to talk about when it comes to things like rule of law, we need to show why this is not just lending itself to more efficient markets, but why rule of law reflects the higher lights of who we are as human beings. That we have these rules and these rules reflect commitments to certain goods that are always good for human beings. One being that we behave reasonably rather than behave in an arbitrary manner, or that we, we think that it's possible to identify principles of justice that we want rule of law to embody and reflect. Or when it comes to things like trade questions or the, the whole issue of trade liberalization that yes, it's materially beneficial for countries that go down this path, but we should also see this as extending the civilization of natural liberty, uh, throughout certainly western countries and hopefully more generally as a whole.

Now, that doesn't mean I think that free trade leads to heaven on earth. I'm, I'm not even sure I, I, in fact, I tend to be skeptical of the argument that free trade necessarily leads to more a more peaceful world. I think there's good evidence that that is not always the case, but that we need to create this sense that the case for markets in good economic market orientated economic policy forms part of a wider civilizational endeavor. And we need to use words like and expressions like civilization, an expression, a civilizational agenda and endeavor that is reflective of the fact that human beings are capable of great depravity, but also great, uh, great achievement and even moral greatness. And that I think is part of what those of us who believe in markets need to reintroduce into the discussion because we effectively concede, I think in many cases a lot of that ground at the moment to those parts of the right who have, who have gone down this sort of postliberal market skeptical approach, but also the left who have successfully managed to persuade a lot of people, including people of your age, that if you're a good person, you really should be on the layers.

So that I think is part of the challenge for free marketers to build up this type of broader case for markets that's not afraid to see this as part of a civilizational agenda.

Things like the type of agenda that the Scottish Enlightenment had for not just Britain, but the world more generally, making a more humane society that's reflective of who human beings are meant to be. And we are not meant to be simply beings who consume and buy trade and barter. That's part of who we are. That's a very important, important part of who we are. But certainly people like Adam Smith and I think those type of classical liberal thinkers have always had this broader civilization or agenda at the forefront of the way they think about the world and the way they talk about the case for markets. And I think we need a lot more of that.

You mean it's not just Homo Economicus all the time,

<laugh>? Well, I think homo economicus, it could, it economical of course, um, was something that was a phrase that came to be used to describe the economic way of thinking. And it, it tried to isolate certain types of human behavior and certain realities about human beings that it was possible to model that was possible to replicate. It was, I suppose important in it was possible to, uh, apply, to solve any number of economic problems. But homo economicus is not the full reality of who we are as human beings. Homo economy course does not love homo economius, doesn't go to the museum to admire great beauty homo economicus, sees children as more than just people who are going to support me in my older age, et cetera. So I, I do think it's certainly in, certainly in free market circles, I think there, there has been for quite some time some recognition that homo economy course has severe limits and that we need to take into account other dimensions of the human person to get a fuller sense of who human beings are. Cause with that fullest sense of who human beings are, we can say even more interesting things about the nature of economic life.

That's a good point. Um, I wish we could keep talking about this forever and ever. I will say, I think your book is the first step towards the next American economy. And listeners, I wish you please, please check it out. Um, I learned so much from this interview and from the book itself, so go give it a read. I have one last question for you. What is one thing that you believed at one time in your life that you later changed your position on and why?

Oh, well, I'll start by saying I was never on the left. I never went through a stage of thinking that the good people were all on the left and the evil people are on the right <laugh>. I I, I was ne remember what is the Churchills saying about when I was young, I was a, and I, uh, I followed my heart and I was a socialist, and then I grew up and I followed my brain, which made me into a conservative or a free marketer. I was always, I was never on the left, never, ever, ever.

Yeah, yeah. I mean me either <laugh>.

So I mean, but I think there's more of us like that than, than perhaps we, we often realize, I suppose the thing that I've changed my mind about is that persuading people to embrace good ideas is a lot harder than I would've thought, say 20 years ago. I think when you are younger, you tend to be very optimistic about people's capacity to change, to entertain new ideas, to embrace different possibilities. But I've come to see over time that the capacity of human beings to clean the particular notions about whether it's the economy or the way that politics works or what they think is important, uh, they, our capacity to change is more limited. I don't mean it's impossible, it's absolutely possible. But what I've come to conclude is that the business of persuading people, particularly when it comes to embracing, say, pre-market ideas or limited government ideas, it's a lot harder than I think we often realize.

I think a lot of people by the age of 25, they're more or less set in the way that they view their world. And once things change, when things change around them, whether it's bad economic conditions, et cetera, you'd think you'd like to think, okay, well you, now you understand why socialism doesn't work or why industrial policy is a bad idea. But I've come to conclude that, that even gross failures of that nature won't necessarily encourage people to consider more liberty orientated alternatives. And that's not an argument for giving up on all those things. But it is an argument for expanding the scope and depths of the types of arguments that we bring because we don't do that. Uh, I think we will lose the case for markets and the free society more generally in ways that we don't have to.

Once again, I'd like to thank my guest for their time and insight, and I'd like to thank you for listening to the Great Antidote podcast. The Great Antidote is sound engineered by Rich Goyette. If you have any questions, any guests or topic recommendations, please feel free to reach out to me at greatantidote@libertyfund.org. Thank you.