Power and Market: Government and the Economy

Because of its popularity, we may briefly consider the “traffic-manager analogy”—the doctrine that the government must obviously regulate the economy, “just as traffic must be regulated.” It is high time that this flagrant non sequitur be consigned to oblivion. Every owner necessarily regulates his own property. In the same way, every owner of a road will lay down the rules for the use of his road. Far from being an argument for statism, management is simply the attribute of all ownership. Those who own the roads will regulate their use. In the present day, the government owns most roads and so regulates them. In a purely free-market society, private owners would operate and control their own roads. Obviously, the “traffic-manager analogy” can furnish no argument against the purely free market.