IT’S BEEN ONE OF THE MANTRAS of economic policy since I was a kid: the government shouldn’t try to “pick winners” but leave the fate of industries and firms to the market. Anyone who has unthinkingly accepted the free market dogma that has dominated economics for the last 35 years might think this is one of the founding laws of the discipline, rather than a Thatcherite political slogan dreamt up in the 1970s. You even hear left-wingers reciting it, especially when they’re trying to show how “serious” they are.
Writing in the Guardian last Friday, Martin Kettle (hardly the most left-wing hack on that paper) has challenged this dogma using the example of Team GB’s remarkable success at the Rio Olympics. Almost everyone accepts this was largely down to the investment of public money, mainly but not exclusively from the national lottery. This money wasn’t spent on just anyone, nor was it left to the market. Public money was invested in the athletes that experts thought had a good chance of winning. We tried to pick winners, and in many cases, it seems we picked right.