Op/ed: Government Has Always Picked Winners and Losers

The recent passage of the American Rescue Plan, a $1.9 trillion stimulus law to help the nation through the pandemic, was broadly popular but faced significant political hurdles, writes Associate History Professor David M.P. Freund in an essay in The Washington Post.

Critics on the right and centrist Democrats alike say an “activist” government will stifle the economy and hinder growth, and that the true goal of government is to protect free markets—arguments that ignore fundamental historical realities, he writes:

Throughout American history, public power has been a precondition of our markets, essential to their design and operations. Acts of governance and the exercise of public authority have always structured growth—and shaped the allocation of its rewards. More simply put, public power made our markets and regularly picks winners and losers. In fact, many of the goals being pursued by the Biden administration and promoted by the left aim to redress inequities created in no small part by past government action—government action that defenders of the status quo and critics of redistributive efforts would rather remain invisible.

Control of property has always been key to building wealth in the United States. Yet, the government’s choices dating to before the Constitution have determined who can claim land and share in its benefits. In 1787, Congress enacted the Northwest Ordinance, setting the terms of governance and settlement in newly conquered and purchased Western territories. It carved land into one-mile square lots, then tasked federal officials with granting or selling it. Affluent and, often, politically connected Americans quickly monopolized markets for property.

Read the rest in The Washington Post