When it comes to allocating resources, however, the private sector simply does a better job than the government.
There may be reasons to have less government intervention, but it does not inevitably follow that it will bring prosperity or efficiency.

New Zealand is a glaring example of a country that tried to do everything right and failed. In the 1980s New Zealand privatized all of its basic public services, even the post office, yet its growth has been the slowest in the developed world, at less than half the Organization for Economic Cooperation and Development average.

New Zealand’s downfall was that it did not identify a competitive advantage in the marketplace. By contrast, consider those alleged epitomes of free markets, Hong Kong and Singapore. Both established comparative advantage: Hong Kong had the geographic good fortune to be the gateway to China, while in Singapore the government built the best infrastructure in the region, perhaps in the world. The fact that Hong Kong and Singapore both have systems that allow private sector companies to grow unimpeded has led to a myth that these are places where market forces reign. In reality there is no other country in the world where the government is more involved in economic planning than Singapore; some people describe the economy as socialism done right. In Hong Kong, the government owns the land, and a large percentage of the population—at one point 80 percent—live in government housing.