My take on the Reich/Schelling contretemps described above is that they are both wrong. Reich for assuming that the “after-the-bridge” Pareto optimum would include the bridge and Schelling for assuming that the pareto optimum coul;d never include the bridge.

One would like to see a replay of history with the economists, especially Lord Keynes, following the advice and the example of Bill Hutt. In Politically Impossible: An Essay on the Supposed Electoral Obstacles Impeding the Translation of Economic Analysis into Policy he proposed a “dual formula” for economists to deal with the problem of unpopular policies. He quoted Milton Friedman on the duty of economists to prescribe what should be done, without courting political approval. He then noted that Friedman had departed from his own advice on occasions.
“Friedman’s maxim implies that the economist’s role is to do this (the ideal) and not to do that (the expedient). I suggest it is the economist’s role and duty (in public policy discussions) to do both. Why should not advice proferred typically take the form of saying to the politicians (and indirectly to electorates) with complete candour, something like the following?”

‘In our judgement, the best you will be able to get away with is programme A along the following lines; but if you could find a convincing way of really explaining the issues to the electorate, our advice would have to be quite different. We should have to recommend programme B along the following lines’.”

“I am not suggesting that economists ought ever close their eyes to political realities. On the contrary, when they are concerned with the practical applications of their science, they ought in every instance to bring voting prospects into the picture - but explicitly.”

As Murray Rothbard put it: “[W]here is this alleged tradition of requiring economic theorists to take up the monkish cowl and abstain from all thoughts or implications of their work, let alone take direct posts in government? . . . [T]he call for political abstinence is almost always directed to economists outside the mainstream politics of the day. If economists advocate generally accepted policies, this is somehow subsumed under the rubric of “value-neutrality”; only adhering to policies opposed to the conventions of the day is decried as an intrusion of unclean political considerations into the virtuous realm of economic science.”