Why Governments Shouldn't Subsidize Entrepreneurs

Over time the economy moves away from providing goods and services that are in demand to an economy characterized by cronyism and corruption. When a government starts subsidizing businesses or picking winners and losers it weakens the important profit and loss signals in the economy, he says. The Soviets tried to develop integrated circuits or computer chips at the same time as the Americans in the 1950s but the American businesses benefited from the ability to trade internationally.