Radical Markets: Uprooting Capitalism and Democracy for a Just Society. By Eric Posner and E. Glen Weyl. Princeton University Press; 368 pages; $29.95 and £24.95.

ACCORDING to its detractors, and even some of its acolytes, the philosophy of liberalism has run its course. Populist critics of capitalism and democracy have been emboldened by the financial crisis and amplified by social media. Liberals have struggled to respond. Many are insecure about their intellectual—or geographical—blind spots, apparently exposed by Donald Trump’s election victory and the Brexit referendum. They feel like conductors of a train that has veered off the tracks. Amid this disorientation, an important possibility may have been overlooked: that the rich world’s problems do not stem from an overdose of liberal principles, but from their insufficiently bold application.

In “Radical Markets” Glen Weyl, an economist at Microsoft, and Eric Posner, a law professor at the University of Chicago, argue that the ideals of thinkers such as Adam Smith, John Stuart Mill and Henry George can still inspire radical change. Such luminaries were unafraid of challenging the status quo. Following suit, Mr Posner and Mr Weyl want to expand and refine markets, putting them to work for society as a whole.

In truth, the policies they advocate are so radical that they are unlikely ever to be adopted. But they may help jolt liberals out of their hand-wringing, and shape a new line of market-oriented thinking, as Milton Friedman’s “Capitalism and Freedom” did almost six decades ago. That too was an idealistically pro-market book, unconcerned with the feasibility of its proposals. The authors of “Radical Markets” open with a Friedman quote.

Yet they distance themselves from the “market fundamentalism” inspired by him, Friedrich Hayek and George Stigler. Such thinking is more concerned with protecting property rights than with correcting market failure. By contrast, their primary concern is to mount an onslaught against market power. That does not just mean the overweening clout of the tech titan or the oil baron. It includes the power intrinsic to the very property rights that market fundamentalists often defend. This power, the authors say, prevents markets themselves from being truly free.

Mi casa, su casa

Take land. An owner of a valuable plot in, say, the Bay Area of California is inherently a monopolist. Should an entrepreneur need a lot of space to build an office block or houses, the owner of a single parcel can hold her to ransom. Property may not be theft, but it is monopoly.

The authors think this applies to all property, not just land. Their solution is a new wealth tax. Every individual would put a value on each item she owned, down to the last pencil (potentially a laborious exercise), and would be taxed on her total declared wealth. The twist: she must stand ready to sell any item at its declared value, should a buyer emerge. To see off interested purchasers, she would have to set the value high, and thus incur a hefty tax that would compensate society. If she set the price low, to minimise her tax burden, her assets would be bought up.

The tax would enable property to be put to its most profitable use, while raising revenue efficiently, perhaps to fund a universal basic income. Because rich people own the most stuff, it would be drastically redistributive. Most important, people would come to see property as rented from society, rather than as conferring exclusive ownership. Radical collectivism would replace property-owning democracy. The authors are ready with responses (some more convincing than others) to obvious objections, such as the notion that the poor would live in fear of the rich stripping them of their assets. Still, the scheme will baffle anyone who sees property rights as the foundation of law, even of civilisation, and as crucial to individual flourishing.

Rethinking property rights from scratch might seem sufficiently ambitious for one book. But it is just one of several big ideas. The next is to overhaul electoral systems. Democracy, the authors argue, has never found the right balance between conflicting aims. Minority rights must be protected from tyrannical majorities. But this introduces the same hold-out problem—where small groups can exert undue influence—as bedevils property markets. Policies with diffuse benefits and concentrated costs, such as environmental regulation, are hard to implement in systems that erect too many hurdles to legislation.

Their solution is to import market principles to the ballot box. They would scrap “one person one vote”. In its place, everyone would get an income of credits, to be used to buy votes in elections or referendums. The more influence voters exerted over any single issue, the less they would be able to wield elsewhere. Crucially, the price of a vote in any given election would be the square of the number bought. One vote would cost one credit; two votes would cost four; three votes, nine. Minorities which cared a lot about a particular issue, or feared their rights were under threat, could decide to spend their credits heavily to face down a majority. But it would be expensive. That would make it harder for hobbyhorses to stand in the way of social progress.

Prophets in the wilderness

The authors say their book is intended to refresh liberalism. But their animating philosophy is really utilitarianism: the idea that doing good means maximising the overall level of happiness. They seem relatively unconcerned with individual rights. At the end of the book, they suggest that the logical extension of their property tax would be to apply it to human capital—ie, to require citizens to declare a wage at which they would work, tax them on the basis of that number, and force them to accept any job offers that materialised. They shy away from this idea not because it resembles the enslavement of individuals to society, but because it is impractical.

In another chapter they argue that every citizen should be given the chance to sell a visa directly to an immigrant, whom they would house and help find low-wage work. They say the economic gains to all would be worth the inequality and power imbalances this would produce. At the end of their chapter on voting, they calculate that their proposed electoral reforms could boost GDP by 20%—as if that, rather than the fair allocation of power, is what matters in electoral systems.

“Radical Markets” is refreshing and welcome in its willingness to question received wisdom. Yet it will do little to mollify those who say liberal capitalism has neglected human needs beyond the yen for economic advancement—for community, say, or a sense of wider belonging. Such critics will understandably protest that market principles would sully institutions, such as property rights and elections, that confer dignity on individuals.

Readers who suspect that economic progress cures most ills will be more sympathetic. But even they may view Mr Posner and Mr Weyl in the way radicals are often perceived: as somewhat eccentric. Still, liberals must find some antidote to populism and protectionism. A little outlandishness may be necessary.