Right Thinking From The Left Coast
The price of anything is the amount of life you exchange for it - Henry David Thoreau

Thursday, October 28, 2010

Delusional Joe

Joe Biden:

Every single great idea that has marked the 21st century, the 20th century and the 19th century has required government vision and government incentive,” he said. “In the middle of the Civil War you had a guy named Lincoln paying people $16,000 for every 40 miles of track they laid across the continental United States. … No private enterprise would have done that for another 35 years.

This is the exact opposite of true.  Cato takes apart the specific example:

Early American railroads were built almost entirely with private funds. These railroads provided such superior transportation that by 1850 they had put most toll roads and canals out of business. Individual states still competed with one another for business—and may have offered various favors to the railroads serving those states…. For the most part, however, no federal and few state subsidies went to railroads in the eastern United States.

Read the whole thing, which cites numerous Cato scholars on the subject of railroads.  The subsidies and incentives Lincoln put in place spawned decades of corruption and bankruptcy.

But we don’t need to go that far back.  The communications explosion of the last couple of decades was created by deregulation of the telecom industry. Yes, the government created ARPANET.  But almost everything that has come since has been from private industry. What government flunky though of the iphone?  What political hack forced industry to developed hard drives that fit into the palm of your hand?  (Just this moment, my wife is ransacking the house looking for a data card that is small enough to get lost and spacious enough to contain thousands of digital pictures).

What about HDTV?  During the Bush I years, industry demanded subsidies to develop HDTV.  Bush refused.  I don’t know if you’ve been to a Best Buy lately, but HDTV seems to be doing just fine.

And don’t even get me started on energy policy.  This administration is an avid and vocal supporter of energy-consuming, sky-polluting, planet-warming, poor-people-starving ethanol fuel—the Mother of All Boondoggles that would simply not exist without government subsidies and mandates.  Our economy and the planet would be better off if we simply burned money in our fuel tanks instead of corn ethanol.  Then there is the long ugly history of the Synthetic Fuels Corporation.

Now all lies contain some truth in them and there is something to what Biden is trying, in his ham-fisted, mealy-mouthed way, to say (funny how much less articulate he gets when he can’t plagiarize).  As Adam Smith noted, there is a role for government in funding things that benefit the public generally but are not narrow enough to benefit an interest specifically.  Roads and railroads, for example (to some extent).  General science funding—controlled by peer-review and not by Congress—has helped make this country the world leader in science (necessary disclosure: I am paid out of federal science grants).  NASA spending has stimulated enormous technological breakthroughs. NIH funding has helped uncovered genetic markers of disease and lay down the basics of the discoveries the pharmaceutical industry then turns into practical treatment.  And, as I noted, ARPANET was what the internet was built on.  But all of the big breakthroughs—except NASA—came when government simply put up the money and let scientists and engineers figure out what to do.  Very very little has ever come from politicians issuing edicts and trying to rewrite the laws of physics.

So there is a role for government.  But that role is limited and consists mainly of the economy of scale—of being able to bring large sums of money to bear on specific limited problems or providing apolitical funding to science and technology.  But the idea that “every single great idea” has come from government is sheer poppycock.  Government creates the conditions necessary for success; it does not create success.

Posted by Hal_10000 on 10/28/10 at 07:43 AM in Left Wing Idiocy  • (0) TrackbacksPermalink
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