There is often a confusion of ideas that occurs when people advocate free-markets as well as advocating small government. While the two often go together like peas in a pod they most certainly aren’t the same thing and unfortunately many of our politicians that advocate economic liberalism seem to think you can’t have one without the other.

To conflate small government with free-markets is to labour under the misapprehension that government is exempt from market forces.

Kelly O’Dwyer’s article in the AFR is an excellent example of this phenomenon and I intend to pick it apart to demonstrate where her reasoning falls down.

O’Dwyer seems to be trying to make a common sense argument that Government should ensure that it gets good value for money for it’s programs. She then goes on to use that premise as a justification to defund policies that her political opponents support. The problem is that the examples she chose were particularly poor examples since they are all decent examples of where deregulation and privatization would not only fail to achieve the stated goals of her party but in fact make matters worse.

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