Naomi Oreskes and Erik M. Conway’s The Big Myth: How American Business Taught Us to Loathe Government and Love the Free Market (2023) challenges the assumption that U.S. commitment to free-market fundamentalism is natural or inevitable, arguing instead that it is the product of a sustained, century-long ideological campaign aimed at undermining public confidence in government while elevating private enterprise. In the context of intensifying U.S.–China technological competition, this critique raises a pressing question: given the historical success of American mixed-economy initiatives—from wartime mobilization to postwar industrial policy—can U.S. society collectively move beyond free-market fundamentalism and re-embrace a pragmatic model that strategically integrates state capacity with market forces?
When State and Market Align: Historical Evidence of American Success
American economic and technological leadership has rarely emerged from unfettered markets alone. Instead, the historical record shows that the United States has been most successful when public institutions and private enterprise have worked in concert, combining state capacity with market dynamism. This mixed-economy approach—often downplayed in popular narratives—has repeatedly enabled breakthroughs that free markets, operating in isolation, would have struggled to achieve.
During World War II, the federal government played a decisive coordinating role through the Office of Scientific Research and Development (OSRD). By directing large-scale public funding and aligning academic, industrial, and military research, the OSRD accelerated the development and mass production of transformative technologies such as radar, jet propulsion, and penicillin. These advances were not spontaneous market outcomes but the result of deliberate state-led mobilization that reduced risk and set clear national priorities.
A similar pattern defined the Apollo Program. While private contractors such as Boeing and Lockheed built key components, it was NASA that designed the mission architecture, absorbed enormous financial and technical risk, and sustained long-term investment. The program’s technological spillovers—advances in computing, materials science, and systems engineering—illustrate how government direction can catalyze innovation well beyond its immediate objectives.
More recently, Operation Warp Speed demonstrated the continuing relevance of this model. Faced with a global pandemic, the federal government guaranteed funding, coordinated supply chains, and streamlined regulatory processes, enabling pharmaceutical firms to develop and distribute COVID-19 vaccines at unprecedented speed. Once again, public intervention created the conditions under which private ingenuity could operate effectively.
These cases are not anomalies. The New Deal’s public works programs laid foundational infrastructure, the Interstate Highway System reshaped national commerce, and DARPA’s early investments produced the internet. In the 2020s, renewed government engagement in green energy and semiconductor manufacturing reflects the same logic: public institutions provide basic research, infrastructure, and risk absorption, while private firms scale and commercialize innovation.
Yet this history is often obscured by a persistent free-market myth that credits private enterprise alone for collective achievements while portraying government as inefficient or incidental. A clearer understanding of America’s past suggests the opposite. Time and again, the United States has succeeded not by choosing between state and market, but by deliberately integrating the strengths of both.
The Enduring Power of Free-Market Orthodoxy in the United States
Despite abundant historical evidence of successful state–market collaboration, free-market fundamentalism remains deeply entrenched in American political culture. As Naomi Oreskes and Erik M. Conway argue, this persistence is not accidental but the result of a long-term, organized effort to shape how Americans understand the relationship between government, markets, and freedom.
Central to this endurance has been the strategic promotion of market ideology by powerful business interests. Through sustained investment in think tanks, academic programs, media outlets, and policy networks, these actors have cultivated an intellectual environment in which market solutions are treated as neutral or natural, while government intervention is framed as suspect or inherently inefficient. Over time, these narratives have become embedded in mainstream economic and political discourse.
Equally important is the rhetorical reframing of free markets as synonymous with individual liberty. By casting market outcomes as expressions of freedom rather than as the result of policy choices, advocates have made alternative economic arrangements appear un-American or even authoritarian. This framing narrows the space for legitimate debate, transforming pragmatic policy disagreements into moral or ideological conflicts.
Finally, free-market fundamentalism is reinforced by a form of historical amnesia. Episodes of successful federal coordination—such as wartime industrial mobilization, the Apollo program, and Operation Warp Speed—are commonly remembered as triumphs of private enterprise, with the government’s central role minimized or forgotten. As a result, Americans have not abandoned the mixed-economy model in practice, but they have lost the confidence and conceptual language needed to defend it openly.
Strategic Rivalry as a Forcing Function for American Economic Rethinking
The intensifying technological competition between China and the United States has exposed the limits of rigid free-market ideology and created new pressure for strategic adaptation. China’s state-capitalist model makes explicit what the United States has often practiced implicitly: sustained government involvement in shaping markets, directing investment, and aligning technological development with national objectives. This contrast has turned bilateral competition into a catalyst for reexamining long-standing American assumptions about economic governance.
China’s approach is characterized by long-term industrial planning and large-scale state support in critical sectors such as semiconductors, electric vehicles, artificial intelligence, and battery technology. By coordinating subsidies, infrastructure, and regulatory priorities, the Chinese state enables firms to scale rapidly and integrate tightly controlled supply chains. Crucially, the government absorbs much of the financial and technological risk associated with frontier innovation, allowing private firms to pursue ambitious projects that might otherwise be commercially prohibitive.
The United States, in practice, has begun to respond in similar ways. Legislation such as the CHIPS and Science Act and the Inflation Reduction Act, along with continued DARPA-style funding mechanisms, reflects a renewed willingness to use public power to shape technological outcomes. These initiatives recognize that strategic industries require long-term investment, risk-sharing, and coordination beyond what market forces alone can provide.
Yet these policies are often framed as temporary exceptions rather than as expressions of a coherent economic strategy. Deep-seated ideological resistance to overt industrial policy makes proactive and systematic adoption politically contentious, even when strategic necessity is widely acknowledged. As a result, U.S.–China tech competition does not merely challenge American technological leadership; it forces a broader confrontation with the ideological constraints that have long limited how openly and confidently the United States can employ the mixed-economy tools it already possesses.
Enabling a Societal Turn Toward Pragmatic Economic Governance
A collective shift in the United States away from free-market fundamentalism is possible, but it is unlikely to occur spontaneously. History suggests that such transformations require deliberate changes in narrative, policy practice, and public perception, often triggered by external pressures that expose the limits of ideological rigidity.
Crisis has repeatedly served as the primary catalyst for overriding entrenched dogma. During World War II, the Cold War, and the COVID-19 pandemic, Americans accepted levels of government coordination and intervention that would have been politically unthinkable under normal circumstances. Today, intensifying technological competition with China functions as a comparable inflection point—a modern “Sputnik moment” that legitimizes industrial policy, strategic investment, and long-term planning in the name of national security and economic resilience.
Narrative reframing is equally essential. Decades of anti-government rhetoric have conditioned Americans to view state involvement as inherently oppositional to markets. Recasting the relationship as one of public purpose combined with private capacity—emphasizing coordination over intervention and national capability over industrial policy—can normalize state–market collaboration. Elevating well-documented successes in vaccine development, semiconductor manufacturing, and clean energy helps reconnect policy language with lived experience.
Visible and credible success further accelerates ideological change. Programs such as Operation Warp Speed and early CHIPS Act investments demonstrate that government-led initiatives can operate with speed, efficiency, and strategic clarity. Likewise, the Inflation Reduction Act’s expansion of clean-energy employment provides tangible economic and environmental returns. These outcomes generate a reinforcing cycle in which concrete results build public confidence, enabling broader acceptance of similar approaches.
The social foundations for change are already forming. Survey data indicate growing public support for a strong governmental role in healthcare, education, infrastructure, and innovation, with approval rising sharply when policies are framed in terms of national competitiveness or security. Generational shifts further strengthen this trend, as younger Americans show greater openness to active government engagement in addressing inequality and climate change. Together, these conditions suggest that a collective reorientation toward a pragmatic mixed-economy model is not only possible but increasingly plausible.
Barriers to Reorienting American Economic Thinking
Even if a shift away from free-market fundamentalism is feasible, significant obstacles continue to impede changes in public and political mindsets. These challenges are deeply embedded in the United States’ ideological landscape and institutional structures, shaping how economic policy is debated and evaluated.
Political polarization remains a central barrier. Conservative think tanks, advocacy organizations, and lobbying groups frequently frame interventionist policies as inherently “socialist,” regardless of their historical precedent or strategic rationale. This reflexive opposition narrows the policy discourse and discourages bipartisan support, even for initiatives grounded in national security or economic competitiveness.
Implementation risks further reinforce skepticism. Highly publicized policy failures—such as the collapse of Solyndra—are often treated as emblematic of government incompetence, while private-sector failures receive comparatively less scrutiny. These episodes, though relatively rare, disproportionately shape public perception and are repeatedly invoked to undermine confidence in state-led initiatives.
Underlying these dynamics is a powerful form of cultural inertia. Decades of Reagan-era rhetoric have normalized suspicion toward government action, embedding distrust into political language and civic identity. As a result, the principal barriers to change are not technical capacity or policy design, but ideological conditioning and institutional resistance. Overcoming them will require sustained narrative engagement and demonstrably effective, results-oriented governance capable of rebuilding public trust.
From Ideological Impasse to Practical Renewal
As Naomi Oreskes and Erik M. Conway observe, ideologies rarely collapse because they are disproven; they erode when they no longer function in practice. Applied to economic governance, this insight suggests that free-market fundamentalism will weaken not through abstract critique, but through repeated demonstrations that alternative arrangements work better under contemporary conditions.
Crisis-driven momentum offers the most immediate pathway. Intensifying U.S.–China technological rivalry has the potential to generate bipartisan support for industrial policy by reframing state intervention as a matter of national security and strategic competitiveness rather than ideological preference. In this context, pragmatic coordination becomes a necessity rather than a deviation from principle.
Normalization through incremental success is equally important. Programs such as Operation Warp Speed, the CHIPS and Science Act, and large-scale green energy initiatives build public familiarity with effective state–market collaboration. As these efforts deliver visible results, they help re-anchor public understanding of government action as competent, purposeful, and complementary to private enterprise.
Sustaining this shift requires broader coalitions and institutional innovation. Private firms that benefit from public investment can become advocates for stable, long-term intervention, countering narratives that portray government involvement as inherently hostile to business. At the same time, new forms of mission-oriented capitalism—such as public venture funds and sectoral coordination councils—can embed democratic accountability into economic planning while preserving market efficiency. Together, these pathways point toward a gradual but durable reconfiguration of American economic ideology grounded in practical success rather than doctrinal purity.
Reclaiming the Mixed Economy as a Strategic Necessity
The United States already operates, in practice, within a mixed-economy framework, though often inconsistently and under persistent ideological denial. Government coordination, public investment, and risk-sharing remain central to competitiveness in technology, infrastructure, and national defense. The core challenge, therefore, is not institutional capacity but ideological resolve: the willingness to acknowledge openly that state-led coordination is an essential pillar of innovation, economic strength, and national security.
Clinging to free-market fundamentalism carries tangible strategic risks. In an era of intensifying global competition, particularly with China, doctrinal resistance to industrial policy threatens to undermine U.S. leadership in critical sectors such as artificial intelligence, biotechnology, electric vehicles, and clean energy. Markets alone cannot reliably mobilize the scale, speed, or long-term investment required in these domains.
By contrast, a deliberate reclamation of the mixed-economy tradition offers a viable path forward. Crisis-driven initiatives, sustained narrative reframing, and the accumulation of visible policy successes can gradually normalize state–private collaboration as a defining feature of American innovation rather than an ideological exception. Embracing this pragmatic model is not a departure from U.S. tradition, but a return to the strategic practices that have repeatedly underpinned national success.
Key Takeaways
A collective shift away from free-market fundamentalism is both plausible and historically grounded. The American experience demonstrates that state–market collaboration gains broad acceptance when presented as pragmatic, results-oriented, and aligned with national purpose. Today’s geopolitical pressures, growing public receptivity, and existing policy initiatives provide unusually favorable conditions for such a transition.
The central obstacle is not feasibility but ideology: a deeply entrenched myth that treats markets as infallible and government as inherently defective. Overcoming this legacy will require sustained narrative clarity, demonstrable policy successes, institutional competence, and political leadership willing to articulate a simple truth—America succeeds most reliably when public authority and private enterprise operate in deliberate partnership.
References
- The Big Myth: How American Business Taught Us to Loathe Government and Love the Free Market. Naomi Oreskes and Erik M. Conway. 2023.