I'd say that, in reality, open borders do require action by the state; just like deregulation, it's something that is often portrayed as 'inaction', but actually ends up quite complex in practice. The EU/ Schengen zone, for example, needs to harmonise residency policies and external borders, develop cross-border policing and justice coordination between nations, harmonise workers' rights and healthcare, all without a common language or a common defence force. Especially as most laws are designed for a world with borders, you would need to change a lot to implement open borders. Of course, you could just completely scrap the border police, visas, and any border checks and see what happens, but I doubt that anyone is seriously suggesting that.
I'm not arguing that we should always invoke a strict precautionary principle based on the status quo, although a mild 'Chesterton's Fence' precautionary principle until we understand the facts on the ground is always prudent. Either way, any change we want to make or campaign for will be marginal, based on a country's specific circumstances (imagine Canada vs. Israel). I presume you agree that it's a bit ridiculous to have a hard border between the US and Canada, but I presume you wouldn't recommend that Israel opens her gates freely to the Arab world.
As for the 'policy paralysis' idea, any policy I would suggest or campaign for would be at a far, far smaller scale than open borders. This is both for practical reasons, and out of a precautionary principle. I think it would probably be more ethical if the UK spent 2+% of its budget on foreign aid, for example, but I think that's both politically impossible and could possibly have adverse consequences (if we cut other parts of the budget), but I've contributed to an (unsuccessful) campaign to keep the aid budget from going down from 0.7%, which I'm very confident is the ethically superior choice, and whose adverse consequences would be much smaller.
With migration, we all have a basic understanding of how migration can work and how it can cause harm, therefore any intervention I'd propose would try to harness these benefits and mitigate the harm based on this model. I might dedicate some time or effort to loosening restrictions concerning a certain population (I would be in favour of post-Brexit free movement to the UK by Aussies and Kiwis, for example), but I might also support restricting certain kinds of migration. I've read Caplan's book and a lot of migration literature, and while I'm generally pro- migration at the margins, I don't think we have anything like good evidence that open borders work, largely because all the evidence is theoretical and/ or based on controlled migration (or migration within a group of similar income countries etc.).
Great review, I agree very strongly with the America-centric nature of the book being annoying and misleading, but I have a few niggling points:
I don't think your claim that 'the intervention is closed borders' is quite right. The status quo is differing levels of restriction of movement between regions and nations that have developed as a result of long historical processes. As the EU demonstrates, it can be as difficult to manage (relatively) open borders as it is to manage (relatively) closed borders. The status quo is that countries and regions choose different levels of migration, and different kinds of migration, to suit their values and needs, therefore the UK, the EU, the US, Canada, China, the Gulf Countries and Australia have all developed hugely different migration policies, while all remaining largely successful as nations over the last few decades.
Arguing for '100% closed vs. 100% open borders' gets very abstract and it's difficult to argue from the facts rather than ideology, because fully open or closed borders are so rare. Although it can be useful to try and nudge the Overton window, the intervention is always going to be a marginal shift in the status quo, but even then, we should be humble about the downsides of marginal shifts either way.