Politicians all over the world are showing renewed enthusiasm for public ownership of private companies. The methods range from modest government stakes to outright nationalization, but the trend is apparent. Whether driven by concerns about supply-chain resilience, national security, deindustrialization or “profiteering” — often all of the above — the state is taking on a bigger economic role. It’s unlikely to end well.

History shows that public ownership — the most heavy-handed intervention — is almost always a mistake. The stated goals of such takeovers might sometimes be legitimate, but market-friendly, arms-length regulation is a much more reliable way of achieving them. Successive waves of public ownership have typically been followed by disappointment and, in due course, reversal. Evidently this lesson will have to be learned yet again.

The US government has lately taken equity stakes in dozens of companies, in sectors ranging from critical........

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