“Beyond the prohibitionist approach”: is smart, rapid regulation of high-risk products possible?

Politique Internationale — Why do you believe it is absolutely essential to promote liberalism today?      

Michael Miguères — Because we are experiencing a form of decline. This is no accident. It is driven by several factors: an economic system that no longer generates growth, deindustrialisation that relocates productive jobs abroad, an abysmal debt burden to plug unsustainable budgets, and barriers to innovation.

 We are experiencing the opposite of the “Trente Glorieuses” post-WWII boom post when the French enjoyed years marked by a much more diluted bureaucracy than today, when public spending did not exceed 30 to 35 per cent, when France was the world champion of industry, and when Georges Pompidou articulated his famous maxim: “Stop annoying the French”.

 Back then, public policy was guided by the economy. In the National Assembly, at the highest levels of government and within the civil service, there were experts in industrial affairs and numerous engineers. Admittedly, at the time, global competition was significantly weaker in terms of labour and financial markets; but there was no system that overwhelms businesses and citizens with standards, taxes, legislation and regulations.

P. I. — One might object that, since then, concern for the climate has skyrocketed. Is this urgency to preserve the planet not a sufficient explanation for the increase in regulations?  

M. M. — An example springs immediately to mind: the advent of the railway in the early 1830s. Admittedly, the railways were heavy coal consumers and, from that time onwards, vast quantities of CO2 were likely already being released into the atmosphere, with dreadful black clouds blanketing the landscape. Nevertheless: should we, for that reason alone, have halted the development of the railways, which were essential to the Industrial Revolution and contributed to life expectancy doubling between 1830 and 1980? Few people would argue that today.

 It is all a matter of trade-offs, with the consequences that this entails. At present, the debates are still the same. In France, we are constantly questioning the ethics of AI; we are wondering how to safeguard data usage; yet we are introducing so many safeguards that compared to other countries, we are widening our technological gap. Ultimately, we are completely dependent on foreign firms; we pay dearly for this, and we use products that do not comply with the standards we pride ourselves on upholding. We are losing out on all fronts.

P. I. — Do you think most French people are in favour of liberal ideas?

M. M. — The indicators are there to prove it. I am drawing on the survey conducted by Ifop for Les Actifs Anonymes (1). It shows, in particular, that the French overwhelmingly support stricter budgetary rules. Three-quarters of them say they are in favour of a rule prohibiting budget deficits becoming part of the Constitution, except in exceptional circumstances. At the same time, 62% believe that the average standard of living for the working population should be higher than that of pensioners. Aligning special pension schemes with the general scheme garners 76% support. Finally, on the subject of work, the picture is quite clear: a majority (57%) believe that compulsory income tax is too high. In short, we can gauge the extent of the room for manoeuvre — with the risk, if nothing is done, of sacrificing an entire generation. This is an exciting time; we need a new social and economic contract.

P. I. — Would this “sacrificed youth” be the heavy price paid for the lack of deregulation?           

M. M. — First and foremost, the reality is that the young are the ones who are being sacrificed. Let us go back to the heart of the Pompidou years and those that followed: back then, it took five years’ worth of the median wage to buy a flat in Paris. Nowadays, nothing is affordable for anyone under twenty-five! This means you have to work five times harder than before for the same standard of living. It is an unspeakable injustice!

 Why this gulf? Firstly, because of the job crisis: access to the labour market has become increasingly difficult, in the wake of deindustrialisation and the loss of competitiveness, and therefore of growth. Growth has been sluggish for the past 15 years, and is driven solely by debt. Debt which, in turn, weighs on interest rates. Let us not forget that interest on the debt now exceeds government spending for Education, Health or the Armed Forces. This is irresponsible. Previous generations were able to prosper in a more liberal system because there was no debt and no budget deficit. This is one of the cruxes of the problem.

 The other major difficulty is the excess of regulations and the reflex to constantly turn to the state for solutions, which creates numerous mechanisms that are regrettable from an economic point of view and quite terrible socially — I am thinking, in particular, of depression, addictions of all kinds and the rising number of suicides among young people. It is as if the adults have given up.

 In this context, one might expect the political class to take action, but, in a somewhat cynical and electioneering manner, many believe that only the baby boomers turn out to vote and that, consequently, policies should not be geared towards young people...

P. I. — Are there countries that are faring better than others when it comes to liberalism?        

M. M. — A striking example in Europe: Poland, which has recorded an annual growth rate of between 3 and 5 per cent for nearly 15 years. The country’s public spending does not exceed 35 per cent, and entrepreneurs are seen as the driving force, with the benefits that this entails. The case of Argentina is also illuminating. President Javier Milei has set out to restore monetary stability and drastically reduce public spending. This shock therapy has notably resulted in a reduction in the number of ministries and accelerated deregulation. More generally, one can take this line of reasoning to the extreme and look at the examples of countries with very low tax rates — Singapore, Monaco, Luxembourg, Switzerland, the United Arab Emirates — which attract significant capital, businesses and investment and boast high per capita GDP.

P. I. — When it comes to public health, is the liberal approach really appropriate?

M. M. — In 2000, France had the best healthcare system in the world. Twenty-five years later, and despite the billions added to existing budgets, we have fallen by more than 20 places and there are no more hospital beds. Why? Because the bulk of the funds have been swallowed up by bureaucracy; this is unsatisfactory for everyone. The liberal approach is a question of method: how can we best organise healthcare policy for patients? The challenges are numerous and insurmountable within the current system. We must therefore explore new, less bureaucratic approaches that make better use of our expertise and infrastructure, with less rigidity and more flexibility to provide the best possible care for our fellow citizens. During the Covid pandemic, we saw China build hospitals in nine days. We must aim for the same agility and the same capacity for decisive action on the part of the state. The aim of a progressive health policy is to improve everyone’s health, and thus to minimise anything harmful to the human body. Liberal methods are to be contrasted here with collectivist or bureaucratic methods, which fail to deliver the desired results. On such matters, therefore, there is no fundamental disagreement, but rather a difference in approach. We observe that certain products are subject to strict restrictions, such as cigarettes, whilst others are proliferating in a completely uncontrolled manner, such as hard drugs, and that at the same time, many obstacles are being placed in the way of alternative options.

P. I. — Among the bans and restrictions are those concerning the use of cigarettes. What is your position on this issue?

M. M. — It is an interesting subject because it highlights the limitations of liberal and libertarian approaches in public opinion, but also the intrinsic limitations of overly restrictive systems.

I believe that no one disputes the harmful effects of cigarettes and that we can only be glad to live in an era where people no longer smoke on planes, trains or in public places. Does this mean that government action is necessarily the most effective? The structure of government action in this area resembles the logic applied during the American Prohibition era, which led to the emergence of parallel markets and unregulated alternatives over which the state struggles to exert influence. One does not get the impression that we are as strict with certain drugs as we are with tobacco, and we are seeing an increase in the consumption of cannabis and cocaine in France, which is a real cause for concern. If we were to apply a liberal approach to combating tobacco — far removed from the caricature promoted by certain libertarians, or rather libertarians, who would like to let people ruin their health if they so wish — we could achieve a more effective policy in certain respects. 

P. I. — What would be an effective alternative policy regarding cigarettes?

M. M. — Having explored this issue with liberal economists, we have come to the conclusion that an effective alternative policy would not consist of yet another ban on cigarettes themselves, but rather a break with the current prohibitionist approach in favour of a comprehensive and consistent harm reduction strategy. Smoking tobacco remains the main factor in its harmfulness (tar, carbon monoxide, toxic substances). Smokeless products (vaping, heated tobacco, nicotine pouches) are not harmless, but they fundamentally alter the risk equation by eliminating combustion from the equation or reducing it. Blindly banning or equating these alternatives with combustible tobacco would be counterproductive: it would keep smokers hooked on the most dangerous product, shift demand towards less regulated illegal channels, and deprive adults of riskreduction tools.

 We will soon be publishing a paper on the perverse effects of prohibition, which explicitly criticises this conflation of nicotine, addiction and combustion, and denounces a binary logic (“permitted or prohibited”) that ignores relative risks. The aim should rather be to shift the consumption of combustible cigarettes, not by banning them by decree — which would not eliminate demand, as the economics. of prohibition show — but by gradually replacing them with betterregulated alternative options, whilst strictly protecting minors and informing adults. And, above all, we must leave it to manufacturers to develop alternative approaches and innovations in this area, so as not to repeat the same mistakes made with deindustrialisation or the famous solar panels that we are forced to import from China, since we are crushed under our own standards. 

P. I. — Do you think it will take a long time to implement this approach?

M. M. — It all depends on political will. Some things could happen quickly, others would take longer. The obstacles are not technical or time-related, but cultural and doctrinal: it is a matter of moving from a paralysing precautionary approach and an ineffective “nanny state” to a framework of acceptable risk, adult responsibility and controlled innovation.

 The paper we are working on highlights that the longer we wait, the more industrial, fiscal and health opportunities evaporate and the stronger the black markets become. A shock therapy approach is specifically designed to break quickly with the prohibitionist reflex. Advances in behavioural economics could also be utilised. Continuing to ban alternative options amounts to indirectly protecting traditional cigarettes, whereas smart and swift regulation of reduced-risk products would yield far better health outcomes.