The Entrepreneurial State: how the "free market" stalls without government-funded innovation


#1

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#2

“She points out that the United States owes its rise as an economic powerhouse to high-risk investments that the private sector would never back, such as the development of the Internet and a huge host of pharmaceuticals.”

The United States … owes its rise to … the Internet? Pharmaceuticals?


#3

How about the interstate highway system and Apollo? I agree that those examples where not what I expected at the end of that sentence.


#4

World War 2, I’d say. And then, just a bit less so, the Cold War.


#5

The New Deal, World War II and the Cold War made America a superpower that could afford guns and butter. the US didn’t have to rebuild or repay after WWI, giving us a leg up on the old world empires. we came through the Great Depression with a rebuilt infrastructure and without a civil war or even major regime change. We fought much of WWII as the factory and breadbasket of the allies. We emerged from WWII with our population and means of production mostly intact. We then immediately entered the Cold War and spent rocketships of money on research in outrageously obscure and cutting edge fields like nuclear physics and space travel. And this gave us so many unintended inventions that it fueled our economy for 60 years, changing America from a nation of producers to a nation of consumers.

It was during this time that the nature of business changed, and business became much more political and profit hungry, eating it’s own legs from the early 1970’s on. Business got greedy and saw the money spent on the people as just more money that could be spent on it. and so it changed politics to be businesses vs the people, and the people lost.

And now Businesses don’t want their government to invest in big ideas that will grow everyone, because some of the money will go to their competitors, so they starve the government, after feeding from it for so long that they can no longer see where they came from.


#6

It’s unfortunate to use only illustrations from the past decade, but really, who even remembers the twentieth century?

Going further back, I’d throw in the TVA and even the post office as other good examples.


#7

It ought to be pretty obvious to anyone who looks at history that the big developments were made because of government funding. Those solar panel rebates and tax credits did a lot to get PV panels onto a million(?) rooftops, and the development of the integrated circuit was funded entirely by NASA and Air Force early adoption.

Oh, and Tang.


#8

Wow. Nailed it in 3 paragraphs! Well done sir! (No snark intended!)


#9

Jurgen Habermas approves this argument!


#10

You probably already know this, but Tang had been around quite a few years before the Apollo program. Tang just latched onto NASA’s coattails after the fact.


#11

Yeah, I shoud have used the Parker pressurized ballpoint pen that writes in space as my facetious example.


#12

Yeah I agree, the earlier stuff was seminal, the author was maybe trying to say, or wanted to say or could have more accurately said that the internet and Big Pharma, both heavily govt subsidized, were the latest things to secure the dominance achieved early on.

Whether by continuing technological advancement… or placating the masses with pills, distraction and Doritos, but most likely both since we see both, internet and Big Pharma definitely do both, thank goodness. Where are my pills anyway?


#13

Uh…lots of us?


#14

Guns, germs and steel?
A heavily forested, inadequately defended landmass with an intact soil-food web and largely unexploited natural resources?

It took a long time to save our nickels and dimes for that project. Planning. Long-range planning, starting just after World War I.


#15

Maybe the US doesn’t owe its rise to the internet and pharmaceuticals, but the US government has backed speculative research and development ever since Eli Whitney scammed the Continental Congress with his crackpot idea for manufacturing muskets with interchangeable parts. That’s before there even was a US. It took another 40-50 years before his scheme was validated.

It isn’t so much the internet and pharmaceuticals in particular, but the willingness to piss money down a tube to develop new technologies and industries that has made the US what it is. It wasn’t WWII, but what we went into WWII with that let us come out as one of the great superpowers.


#16

I’m going to come back later and mine this thread for quotes. Thanks, @kaleberg7, @Dragonbait1!


#17

The Interstate Highway System is an environmental disaster. It was a big subsidy to land owners, the automobile industry, and the oil industry. We had a very efficient network of railways, mostly paid for without soaking the taxpayer, which was forced into ruin. The IHS encourages inefficient use of land, oil, and other resources.


#18

I seem to recall from my dim memory of the late 1800s that the rail system had a plague of “robber barons” who were after the same government handout for private profit that plagues the economic system of today. Back then, though, there was plenty of land to be taken with no ill consequence.


#19

Eh, not really… there was a lot of soaking going on, it just had less governmental strong-arming at the national level involved. The robber barons lied, cheated, and stole from all the communities in their paths in order to build the railroads.

At this time - and indeed ever since it was built - this is very true. HOV lanes and Tesla Supercharger stations being small moves towards efficiency and sustainability, respectively.

The conversion of American communities into impermeable hardscapes and the clearing of snow from roads are worse things, environmentally, but I guess that’s somewhat off-topic.

The IHS system was built for national defense and serves that function extremely well. It also provides a path for additional infrastructure (as did the rail corridors) that could conceivably generate more value over time than the cost of the IHS.

History puts vaseline on the lens, I guess… my friend Red’s grandmother used to say it was perfectly all right for Europeans to take the land from the Indians, because “they weren’t doing anything with it.”


#20

And yes, I know it wasn’t a NASA development. Fisher, like Tang, saw a marketing opportunity.