The Economists’ Hour

From 1969 to 2008, economists espousing free market theories gained influence in Washington, DC, on Wall Street and around the world.

In the years after World War II, the US economy boomed, and policy makers drew up rules and regulated commerce with little regard for economic theory. However, when the boom subsided, the dismal science came to the forefront of fiscal management. Economists, most famously Milton Friedman and Arthur Laffer, proselytized against government intervention, urging politicians to open up markets, lower taxes and neuter regulations.

That approach bore fruit. With nations trading more freely and goods more readily available, living standards rose across the globe. Infant mortality declined in every nation in the world. But free market acolytes oversold the revolution. The rise of globalization and a harsher economic reality may have been inevitable, but the doctrinaire prescriptions doled out during “the economists’ hour” deepened the pain and accelerated the disruption. Despite America’s embrace of lower taxes and fewer rules, US economic growth has slowed steadily, from...