It is true, of course, that any functioning market system needs rules if it is to function efficiently, as the recent financial meltdown proved. And it needs the government to act as referee, especially to prevent powerful incumbent firms from strangling threatening newcomers at birth. But in present-day Britain, after the recent upheaval in the financial sector and the rules it has spawned, the danger of too much regulation far exceeds the risk of not enough. The voices calling for more regulation of business are out — shouting the few calling for less. So the risk of too much exceeds the risk of too little. Which suggests that nothing short of a regulatory moratorium will get the regulators to cap their pens. Yes, it would be better if the government could make the programme to test the costs of new regulations against their benefits work, but neither its predecessor, which probably had no taste for that chore in the first place, nor the existing lot can manage that.

Unfortunately, the stabilisation of the macroeconomic environment and removal of uncertainty created by the Treasury's ability to make the rules up as it goes along, and to ratchet up enforcement when it is feeling poorer than it would like to be are only part of a growth strategy.

Another part is removing the Treasury from its key role in economic policy-making, and confining it to implementing clearly articulated policies. With Treasury in the lead, policy-making is decidedly anti-growth, no matter the wishes of the incumbent Chancellor. For the mandarins at the Treasury, growth is a bother, which explains their eagerness to manage decline before Margaret Thatcher took control of policy-making and set Britain on a new path to growth. Growth means new companies, headed by, you know, arrivistes who are inclined to push the envelope on tax avoidance, whom the mandarins have never met and therefore cannot comfortably ring up to get this or that done, whose entire existence depends on their ability to undermine the incumbent firms that make up such organisations as the CBI, with which the Treasury comfortably negotiates when there is a fuss about some tax issue or other. 

There is worse. No dynamic accounting for the Treasury. Lower a tax, and they see only short-term revenue losses; raise a tax, and they see gains. Never mind the long-term effect of tax policy, the impact of tax increases on the willingness of fledgling entrepreneurs to take risks and, in the case of working people, to put in that extra overtime. Or the possibility that tax cuts — not all, but some — might just produce long-term gains that offset short-term revenue losses.  

If Britain is to grow, control over policy must be shifted to the Prime Minister's office. Not that he is necessarily cleverer than the Treasury bureaucracy. Rather, it is that he has a greater incentive to pursue a pro-growth policy, since his ability to retain his job very much depends on it.