Is There a Crisis in the Tax Code?

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Every system is designed to produce the outcomes that this system is producing. So I would say getting rid of all industrial policies and just recognizing that the Robert Pindyke did a B con talk not long ago where he advocated for carbon tax. However, if you have something like a carbon tax as imperfect as it is, at least then contingent on that, you're relying on a set of profit and loss signals to tell us which of these alternative energies is best.

Economist and political scientist Michael Munger of Duke University talks about industrial policy with EconTalk host Russ Roberts. Munger argues that in a democracy, the default outcome for industrial policy is crony capitalism--attempts to improve on that outcome either by appointing experts or eliminating cronyism are going to fail for political reasons. The conversation concludes with a discussion of the reliability of Munger's claim and what options are left for dissatisfied reformers.