The Arrogance of Centralised Knowledge

Warwick Grey

October 19, 2025

4 min read

History’s worst failures began with the belief that a few people could plan life for everyone else. As Thomas Sowell warned, knowledge is local, not central. Freedom and markets succeed because they trust ordinary people to decide better than distant experts ever can.
The Arrogance of Centralised Knowledge
Image by Heritage Images - Getty Images

History shows that many failures start with the same mistake: believing that a small group of people know enough to plan everyone else’s lives. From Soviet central planning to modern digital ID schemes, the idea of top-down control always promises order but delivers chaos.

Economist Thomas Sowell warned about this more than forty years ago in Knowledge and Decisions. He argued that societies fail not because people are stupid, but because intelligent people forget how little they know. It was, in his words: “the fatal misstep...to confuse intelligence with knowledge and to assume that those who are more intelligent are therefore more knowledgeable.” Real knowledge, he said, is spread among millions of people who understand their own circumstances better than any official ever could.

When power is centralised, that scattered knowledge gets ignored. During COVID, governments relied on a narrow set of experts and computer models, shutting out the everyday experience of teachers, shop owners, and workers. The result was policies that looked scientific but often made little practical sense.

Sowell’s answer was decentralisation. Markets and local decision-making work because they use real-time knowledge from the ground up. Prices, for example, tell farmers when to plant or consumers when to save. No one person has to understand everything; information flows naturally through millions of choices.

Central planners, by contrast, make decisions without paying the cost of being wrong. Their mistakes persist because failure brings no penalty. The global rush toward unreliable energy systems is a case in point: policies made by distant officials ignored the warnings of engineers and consumers. When the lights went out, they blamed “unexpected conditions.”

The modern world has replaced kings with experts, but the danger is the same: power without humility. Expertise matters, but it should guide, not rule. Governments should set fair rules and let people make their own choices.

Freedom works because it accepts a simple truth: no one knows enough to run the world from the centre.

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