LAST time I wrote about some of the issues raised in Dieter Helm’s 2024 book, ‘Legacy: How to Build the Sustainable Economy’.

In the course of his argument, Helm reminds readers of the extent of our ignorance. We do not know what the climate will be like a few decades ahead, nor how much biodiversity will have been lost, nor how much damage will have been done by pollution.

We do not know what technologies will be developed over the coming decades, nor do we know, where there is a choice, which will be popular with the public.

Will heat pumps be the best solution for domestic heating? Are lithium-ion batteries going to be the best sources of power for cars and other transport? What will be the best technology for keeping the lights on when the wind doesn’t blow and the sun doesn’t shine? Will hydrogen technologies make a contribution in these situations? Will there be a role for tidal and wave power? Will nuclear fusion become a source of power in the next twenty or thirty years?

‘The sustainable economy’, Helm writes, ‘assumes that we are profoundly ignorant about the lives of future people and the environment they will inherit’.

In situations of uncertainty, government planning is, at best, a guess about probabilities. When a guess becomes a government plan, it can become resistant to change.

The private sector, on the other hand, can respond to change, keeping abreast of the latest technological research and development, keeping an eye on the market and the volatility of customer preferences, and applying entrepreneurial expertise, with the flexibility to react to developing situations, to find out what works best.

The role of government is to create the environment in which this destructive entrepreneurialism can flourish.

Henry Haslam is the author of ‘The Earth and Us’.