<p>In the early days of the deputy prime minister’s preoccupation with MMC, I had the temerity to suggest to a senior civil servant that the government had no place telling housebuilders how to build. His response stunned me: “Yes they can, they are the government, they can do anything they like.” At one level he is right. Governments, especially in British-style democracies where the winning party takes all, can “do”almost anything they want, especially if they have a large majority. But doing something is not the same as achieving something. In a liberal democracy, with a market economy, while there are no limits to the policies a government can devise, there are severe limits to what these policies can achieve. </p> <p>Policy must be designed around the way the world is, not the way ministers or civil servants would like it to be. I would like to think my civil service colleague was uniquely misguided, that ministers and officials are all too aware of the limits of policy and always mindful of the role of markets and the private sector. But 18 words buried away in a new government document that few citizens will read, or even be aware of, …