HARPER’S MARKET CRASH.

Stephen Harper’s last book, A Great Game, written while he was prime minister, was about hockey — and an interesting though not lively book it was. (Did you know the franchise that became the Toronto Maple Leafs was actually the first, vacated franchise of the Montreal Canadiens?) Harper’s new book, Right Here, Right Now, written since he retired from prime ministering and presumably could spend all his time on hockey, is actually about politics and policy, and it’s both interesting and lively.

Hockey does enter into it. In a chapter that reads like a somewhat off-topic, all-purpose speech to CEOS, he quotes what Hall-of-fame coach Scotty Bowman once told him about the uselessness of cultivating the press: “If you are doing well, you don’t need them. If you are doing badly, they won’t help you.”

The book’s message is that the populism we see in the U.S., Britain and elsewhere — though not so much yet in Canada — is real and justified and that conservatives need to respond to it, mainly by ditching the freemarket fundamentalism that many of us small-c conservatives and small-l libertarians have been wed to since the Reagan-thatcher era.

Harper thus buys into the economic interpretation of the Trump vote, which suggests people hurt by globalization provided his winning edge (of three million votes). But after the last month of melodrama surrounding the confirmation of Supreme Court Justice Brett Kavanaugh, a good argument can be made that Trump’s support was mainly about social and cultural values, with a big part of his 63 million votes coming from heartlanders tired of being preached to by bicoastal elites about how their governing world view is narrow and racist.

Harper is an economist, one good enough to quote 1941’s Stolper-samuelson theorem, which states that trade reduces the real return to a country’s scarce factor of production. So, perhaps, it’s not surprising that as an economist he opts for the economic rather than cultural interpretation of Trump. His policy answer is, as he repeatedly says, that we should see markets as a tool, not an end in themselves. The conservative path should be to take an empirical approach, learn from the experience the world delivers us — exploiting the groundedness that is an essential part of conservatism — and use markets where and when they make sense.

There are two problems with that argument. First, markets are more than just a tool. They’re the institutional embodiment of freedom.

That market participants exercise their own judgment, preferences, abilities and so on in the way they see fit is a big plus, no matter what outcome this leads to. By contrast, the infringement of people’s freedom — by regulation, proscription, supply management, or whatever — is itself a cost, quite apart from the misallocation, corruption, and just plain stupidity of many often-well-meaning interventions. This loss of freedom should always weigh heavily in conservatives’ balancing of markets versus other institutions.

But the second, empirical, problem is by what calculus do you decide some markets are working and should be left alone, while others are producing results that could be improved upon by carefully calibrated intervention (assuming that isn’t a contradiction in terms)?

And if you do have information detailed enough for that, maybe you should take a second look at the socialism Harper so roundly decries. The empiricism upon which conservatives do and should rely is not of the kind that says “there’s $300 million of consumer surplus going to waste over here,” or “if prices were 10-per-cent higher, overall welfare would be 15-percent greater.” That’s the stuff of social planning. Rather, it’s time-worn rules of thumb such as “over and over, history shows that regulators get captured by the industries they regulate,” or “where concentrated interests ask for policies whose costs will be spread over tens of millions of people, politicians usually fold.” Such maxims lead to a very strong presumption against intervention. It may be fundamentalist but it’s also, at bottom, empirically based.

Take supply management (please!, as Henny Youngman used to say). Harper says the opposition to freeing up dairy markets isn’t just political, it’s really economic. Producers have bought quota whose value would crash with abolition. And many small towns are built on the local dairy industry. Well, yes and yes. But if supply management didn’t exist, would we really reinvent it? And does it truly make good economic sense that dairy consumers pay inflated prices for milk, cheese, cream and so on all the way to eternity so that 10,000 producers can be spared a capital loss and several dozen small towns can keep avoiding wrenching change? Does careful, detailed empiricism really tell you that makes sense?

If you discount the future with sky-high interest rates, maybe it does. But use any real-world interest rate and it’s a bad deal.

MARKETS ARE MORE THAN JUST A ‘TOOL.’ THEY’RE THE INSTITUTIONAL EMBODIMENT OF FREEDOM.