Planning an economy of 217 million people is impossible.

So I claim, along with the small number of sensible economists, such as Adam Smith, Milton Friedman, William Easterly, Thomas Hazlett, Ryan Bourne, and a few others.

Most economists have adopted instead the premise, more and more popular since the 1920s, that the job of an economist is to think up new ways for the state to intervene. Subsidize industry X. Regulate wages for employee Y. And on and on. Most economists suppose that such interventions will fix a predictable problem, without causing even more problems.

But prediction sufficient to divert even some of the bigger events in your future is impossible even in your own life, as you as an adult surely have noticed. Does it seem plausible that someone with a PhD in economics, or even a Nobel prize, such as Daron Acemoglu or Joseph Stiglitz or Paul Samuelson, can predict future innovations in, say, finance or agriculture or personal services? Samuelson himself showed mathematically in the 1950s why it is impossible in the stock market. And if an economist such as Marina Mazzucato claims she can predict, as I’ve told you before, why doesn’t she instead set up a bank or farm or beauty salon to take personal advantage of her amazing ability?

Economics can tell us what is foolish as policy, such as a minimum wage or industrial policy or high tariffs on international trade or explosions in the supply of reals. But beyond such sensible recommendations for laissez-faire, it can’t guide a project of economic engineering for 217 million people, no more than you can lay down your future in detail. The attempts at such engineering fails and fails and fails.

Look at the performance of the Brazilian central bank, or for that matter the performance of economic policy in Brazil generally. You don’t need to be a brilliant economist to realize that while your economists have mostly been advising the state to intervene more and more, Brazilian real income has stagnated. There is no reason except foolish economic policy why Brazilians should bump along at a GDP per head that is now matched by, for Lord’s sake, the Chinese! If you simply ignored your economists, and especially your professors of economics in Brazilian state universities, who are mostly Marxists, and listened to me and Adam Smith, there’s no reason why Brazil could not achieve prosperity at, say, Swiss or U.S. standards. In two generations, as for example, Hong Kong did.

Javier Milei in Argentina is doing it right. For example, he ended controls on rents of apartments, which more or less immediately improved the rental market, even for poor people. He proposes to abolish the central bank and tie the currency to the dollar. Go, Javier!

And in my own country, whose election I spectacularly failed to predict correctly, some of the unethical lunatics such as Elon Musk that Trump loves have some good ideas about deregulation. True, they also have fascist proposals to socialize women’s wombs and deport hard-working non-citizens. Pray for us.

Meanwhile, vote liberal.

Weekly column in Folha de São Paulo, Brazil
Translated into Portuguese for the newspaper.