A 10-Year Energy Plan?

Techno-optimistic environmentalists still stuck with old-fashioned, top-down thinking.

Ronald Bailey | February 5, 2008

In November, I commended techno-optimistic environmentalists Michael Shellenberger and Ted Nordhaus for pointing out the intellectual exhaustion of traditional ideological environmentalism. Shellenberger and Nordhaus outlined their scathing critique of special-interest environmentalism in their new book, Break Through: From the Death of Environmentalism to the Politics of Possibility (2007). They pointed out that environmentalism's doomsday predictions and limits-to-growth policy recommendations are political dead ends.

In a world in which billions of people remain mired in poverty and lack access to modern sources of energy, a positive environmental program stressing technological innovation and economic growth is far more politically viable. However, Shellenberger and Nordhaus argue that the threat of potentially catastrophic man-made climate change can only be addressed by massive government research and development initiatives that aim to create low-carbon energy supplies. How massive? To the tune of $30 billion per year over the next 10 years.

Now in a new New Republic article Shellenberger and Nordhaus are calling out "conservatives" for not supporting such initiatives. They note:

At the libertarian reason magazine, Ronald Bailey endorsed our critique of nature-centered environmentalism--which sees regulation as the best solution--but then concluded, "Shellenberger's and Nordhaus' naïve trust in wise government bureaucrats guiding technological innovation is problematic, to say the least." For conservatives to be taken seriously, they'll need to ditch their knee-jerk opposition to government intervention in the economy and recognize that government has long played a critical role in investing in transformational technologies.

Conservative? No. Opposition, yes. Knee-jerk, hardly. What transformational technologies do Shellenberger and Nordhaus claim that the federal government has brought about? They point to the railways in the 19th century, the Manhattan Project during World War II, the Interstate highway system in 20th century, the Apollo moon shots, and the Internet. Most of the technologies they cite were subsidized by government for military reasons, not for reasons of technological or commercial development, much less out of concern for the environment.

In 1862, Congress justified passing the Pacific Railroad Act as a way to forestall a secessionist movement in California during the Civil War. The government subsidized the Union Pacific and Central Pacific railroads at $16,000 per mile over an easy grade and up to $48,000 in the mountains. In addition, the government offered substantial land grants along the right-of-way. Despite these government subsidies, both companies were bankrupt in the early 1870s.

As an example of how government subsidies distort incentives, both railroad construction crews worked past each other building an extra 200 miles of parallel rail lines grades (and some parallel tracks) instead of linking up so their companies could earn more subsidy payments and land grants. The fact that government subsidies were not necessary for building a transcontinental railroad was proved when James J. Hill built the highly profitable Great Northern Railway from Minnesota to Seattle completely without them or land grants.

The Manhattan Project was launched because President Franklin Roosevelt feared that the Nazis were developing their own atomic weaponry. The project was a great success in developing the technologies needed to produce atomic bombs. In the 1950s, President Dwight Eisenhower promoted the "Atoms for Peace" program which aimed to develop civilian uses for nuclear technologies. Under the Power Demonstration Reactor Program, private/public partnerships to build power-generating nuclear reactors began. In 1957, the first nuclear large-scale power reactor began operation at Shippingport, Pa. Two years later, the first nuclear power station built completely without government funding was fired up in Illinois. Today, 109 nuclear power plants produce about 16 percent of all the electricity used in the United States. On the other hand, no new nuclear power plants have been ordered in the last 30 years. Since 1972, orders for 117 nuclear plants have been cancelled. The growth of nuclear power stopped because of regulation, not technical issues. It may yet turn out to be a great commercial success and part of the answer to abating greenhouse gas emissions, but only if regulatory issues are resolved.

Even the Interstate highway system was justified on national defense grounds. As a young military officer, Eisenhower had led an army convoy of 300 men from Washington, D.C. to the West Coast in 1919. The convoy took 62 days to cross the country. He was also impressed by the German Autobahn system. So in 1956, Eisenhower championed the National Interstate and Defense Highways Act. The Interstate highway system was originally estimated to take 12 years and cost $25 billion to construct. It actually took 35 years and cost $114 billion (over $800 billion in current dollars). Building the Interstate system remains the largest public works project ever undertaken in the United States. By most accounts, Interstate highways lowered transportation costs and boosted American productivity. On the other hand, subsidizing highway construction doesn't seem to be a good analogy to subsidizing energy research and development.

The motivation behind the Apollo moon shot program was largely geopolitical. The Soviets had launched the first artificial satellite in 1957 and orbited the first man around the planet in 1961. As a NASA history explains, "First, and probably most important, the Apollo program was successful in accomplishing the political goals for which it had been created. Kennedy had been dealing with a Cold War crisis in 1961 brought on by several separate factors—the Soviet orbiting of Yuri Gagarin and the disastrous Bay of Pigs invasion only two of them—that Apollo was designed to combat." The Apollo program cost $25.4 billion (about $150 billion in current dollars) to land just 12 astronauts on the moon. It is curious that Shellenberger and Nordhaus cite the Apollo program as an example of transformative technologies since it was basically a technological dead end.

Shellenberger and Nordhaus argue, "The fact that some past public investments in energy failed is no more an argument against public investment than the failure of private firms to deliver cheap, clean energy is an argument against markets. It is true that government has made some lousy investments—but it has also made remarkable ones." In fact, with the possible exception of nuclear power, just where are the "remarkable" government-financed energy production breakthroughs? Consider the case of the Synfuels Corporation, which was authorized to spend up to $88 billion dollars on developing energy sources as alternatives to imported oil. It was supposed to be an energy "Manhattan Project" that would produce the equivalent to 500,000 barrels of oil by 1987. Instead, Congress shut it down in 1986. And that's not to mention one failed public/private partnership after another that were supposed to produce automobiles that run on something besides refined petroleum. Just last week, the Bush Administration pulled the plug on its flagship FutureGen demonstration project for capturing and burying carbon dioxide produced by coal-fired electric power plants.

Shellenberger and Nordhaus of course cite the Defense Advanced Research Projects Agency's (DARPA) famous support for communications technology network research that evolved into the Internet. The ARPANET was established as a way to link the defense research community. In the 1980s, the National Science Foundation funded the NSFNET as a way to increase the linkage among a broader community of scholars. The Internet evolved into an open research and commercial environment. That wasn't the way some technosavants preferred things 20 years ago. Remember the Minitel? Minitels were videotext terminals distributed by the millions by the French national telephone company. "The Minitel craze is one case where government intervention, frequently derided as an obstacle to economic change, seems to have helped technological innovation," declared the Washington Post in December, 1986. By 1992, there were 6 million Minitel terminals offering 1,800 information sources. However, the bottom-up Internet handily beat the top-down Minitel. I suspect that the new government-financed energy research would result in technologies more like Minitel and less like the Internet.

Shellenberger and Nordhaus's techno-optimistic environmentalism is still shackled by old style top-down thinking when it comes to technological development. Energy production, especially electricity generation, is one of the least technologically innovative industrial sectors, not least because it is one of the most heavily regulated sectors. The way forward is to encourage bottom up distributed creativity, not top down bureaucratic management. To give them their due, Shellenberger and Nordhaus recognize that throwing government money at energy research and development does not guarantee success. "To be sure, many of these technologies will fail," they write. "But any venture capitalist will tell you that multiple failures are required to reap a single success, and that you can't win if you don't play." The problem with Manhattan or Apollo Projects is that they were "silver bullet" programs aimed at a single technically difficult goal. The problem of developing low-carbon energy is a far more diffuse problem.

Since the problem is diffuse, a far better strategy would be to encourage venture capitalists and other entrepreneurs to finance new low-carbon energy development, rather than a centralized top-down crash research program directed by Department of Energy bureaucrats. One promising technique is to offer substantial prizes for energy production or utilization breakthroughs. A private example of how such prizes might work is the $10 million Automotive X Prize, which aims to promote the development of production-ready vehicles that get 100 miles per gallon of gas. One can imagine big government-financed prizes for various clean energy technologies such as long-lasting powerful rechargeable batteries, super-efficient solar power systems, or bacteria that eat sewage and excrete gasoline. However, the more narrowly the goal of a prize is defined, the more it will constrain the ingenuity of future innovators. In other words, bureaucrats could so narrowly define prizes that they would be engaging in top-down research management by other means.

Shellenberger and Nordhaus are absolutely right in a major way: People simply will not accept limits to growth. So the question is how best to harness human creativity to address the problem of man-made global warming? The simplest and best way to encourage the development of low-carbon energy technologies is to set a price on carbon emissions. Thousands of inventors and entrepreneurs would then have a huge incentive to develop cheap low-carbon energy technologies. The history of government-financed research and development, especially in the area of energy production, is not at all promising. Although Shellenberger and Nordhaus dismiss setting a price on carbon emissions as "a tired old trope," it's a lot less tired than yet another call for a "new Manhattan Project." What's next, an energy policy that's the "moral equivalent of war"?

Ronald Bailey is reason's science correspondent. His most recent book, Liberation Biology: The Scientific and Moral Case for the Biotech Revolution, is available from Prometheus Books.

Comments

Geotpf|2.5.08 @ 3:24PM|#

Bailey misunderstands the point of Minitel. Minitel was an example of a monopoly (the French phone company) actually being very efficient. Basically, they did the math, and figured out that giving everybody who owned a phone a Minitel terminal for free was cheaper than giving them a new phone book every year. This is something that no other phone company in the world figured out.

Being an electronic phone directory was therefore the main point of Minitel. All the Internet-like services (stock market tracking, chat lines, etc.) were just gravy.

|2.5.08 @ 3:38PM|#

Highways as an example of revolutionary new technology? Really?

kinnath|2.5.08 @ 4:01PM|#

The Apollo program cost $25.4 billion (about $150 billion in current dollars) to land just 12 astronauts on the moon. It is curious that Shellenberger and Nordhaus cite the Apollo program as an example of transformative technologies since it was basically a technological dead end.

It's my understanding that desktop computers and remote monitoring systems in medical facilities are mostly direct fall-outs from the commercialization of research done during the space program. And of course GPS-based consumer devices are ubiquitous now.

I've always believed that there is a role for government to play in large scale developments that most likely exceed the risk tolerance of even the largest corporations. But the useful stuff is almost always a derivative of the output of government sponsored development, not the direct output.

That being said, I can't see any kind of government program that could directly or indirectly effect the major drivers of global warming.

CrackerBarrel|2.5.08 @ 4:09PM|#

Not to put too fine a point on it, but ...

I visited the Golden Spike National Historic Site last Year (Techie bonus: To get there from SLC, you drive past the manufacturing site for Space Shuttle solid fuel booster rockets). It's true that parallel roadbeds were surveyed and graded. You can drive along one abandoned grade today in plain sight of the other. But I don't believe that track was actually laid upon most of the 200 miles of overlapping routes.

I support less regulation of the nuclear power industry, and I hope for its re-development in the near future. But I wonder if the industry would have gotten as far as it did before Three Mile Island if it weren't for government caps on liability of plants in case of accidents (Price Anderson Act).

CB.

CrackerBarrel|2.5.08 @ 4:14PM|#

Oops. Kinnath's post reminds me that I forgot to add: As cool as the Space Shuttle, a nuclear power plant or a transcontinental railroad may be, I don't think the government has any role to play in getting them done, except maybe to help enforce contracts and the like.

CB.

|2.5.08 @ 4:14PM|#

Tang, bitches!

Sorry! I forgot. I meant to say:

Tang, fatties!

|2.5.08 @ 4:20PM|#

de stijl: Not even Tang.

|2.5.08 @ 4:30PM|#

CrackerBarrel: Thanks very much for the info on parallel lines vs. grades. According to an online Utah history to which I have now linked in the article, they did build some parallel track though.

Paul|2.5.08 @ 4:34PM|#

And of course GPS-based consumer devices are ubiquitous now.

I've always believed that there is a role for government to play in large scale developments that most likely exceed the risk tolerance of even the largest corporations.

Absolutely, especially in the realm of defense spending. See: GPS.

What I think works so well with defense spending spinoffs, is that the defense department isn't trying to jumpstart technology for the sake of technology, they're trying to solve a specific need or problem, and hire private sector companies to meet that need. If the technology meets the need, that is the test, and then because it was paid for by public monies, the rest of the market can evaluate such technologies and eventually incorporate them into peacetime civilian products.

|2.5.08 @ 4:41PM|#

The only way I can this being beneficial is akin to the X Project prize set-up.

Define some parameters for the prize like cost per kW with all associated carbon output below n.

de stijl: Not even Tang.

Okay, how about Teflon, smarty-pants? Is Velcro too good for you?

kinnath|2.5.08 @ 4:41PM|#

I don't think the government has any role to play in getting them done, except maybe to help enforce contracts and the like.

Tom Tom wouldn't exist if the US Government didn't have a need to drop ordinance with pin-point precision.

I have no problem with civilians exploiting military infrastructure for profit. I have serious problems with the government trying to provide services and infrastructures for civilian use that can be supplied more efficiently by the market.

CrackerBarrel|2.5.08 @ 4:57PM|#

kinnath,

You're probably right re Tom Tom and the rest. I have no problem with commercial spin-offs of military technology either, so long as said technology is really necessary to defense, and not just done for purposes of fostering such spin-offs.

We share the "serious problems" referred to in your last paragraph, but efficiency has nothing to do with it. IMHO, Government should be limited in its scope to protection of rights through defense, courts, and the legislative & executive support for those.

CB.

|2.5.08 @ 4:58PM|#

Seems to me the NIH is a pretty successful example of a distributed large scale government research program--many many grants handed out in relatively small packets to folks with individual initiative in a competitive, peer-reviewed system. Lord knows it's got its problems, but to me this is the model to emulate. Many of us (yes, I am an NIH funded researcher, caveat emptor) work on subjects that would not be funded by big pharma, but result in important marketable products nonetheless.

|2.5.08 @ 5:10PM|#

de stijl: Not Teflon (1938) nor Velcro (1948).

|2.5.08 @ 5:41PM|#

tsk tsk de stijl, no one calls Ron a smarty pants and gets away unscathed.

Jed Rothwell|2.5.08 @ 6:40PM|#

The U.S. and British governments have made vital contributions to just about every major technology developed since 1800, such as:

Canals, roads and road-building technology.

Telegraphs, undersea telegraphs, telephones, radio and television. The government invested in these technologies and also regulated and encouraged them.

Steam engines, steamships. You listed railroads, but you did not say that government took an active role not just in building railroads but in setting technology standards, rules, and many other aspects of railroads to make unprecedented progress. Steamships were built with government subsidies despite bitter opposition from the sailing ship industry.

Starting in the mid 19th century, governments have set detailed safety and performance standards for boilers, railroads, ships, pipelines and countless other technology.

The government, especially Herbert Hoover when he was secretary of commerce, set thousands of industrial standards for everything from screws and bed mattresses to heavy equipment. Industrial mass production would be impossible without this.

Airplanes, airports and every other aspect of aviation.

Computers, (the Internet you mentioned)

Transistors and integrated circuits -- developed by Bell Labs, but government purchases and support quickly brought the technology to maturity.

The maser and laser -- both paid for in full by Uncle Sam.

Countless weapons systems ranging from small arms to submarines -- not just nuclear bombs.

Nuclear power plants.

Space exploration, space based weather forecasting and GPS.

Most medical breakthroughs of the 20th century, such as antibiotics.

Automobile safety, and other product safety standards that have saved hundreds of thousands of lives in the last 50 years.

The human genome project and countless other basic research projects in every scientific discipline.

Cold fusion. Discovered with government money. Confirmed with $5 million from the state of Utah. Since 1989, tremendous progress has been made, thousands of papers have been published, and almost all of it in government laboratories such as Los Alamos, the Italian National Nuclear labs, BARC and in the U.S. Navy. Mitsubishi, Toyota, Shell Oil and Amoco and a few other corporations have made important contributions but most industrial corporations have not.

I could come with dozens of other examples.

There is a lot wrong with the government, but it has done a magnificent job supporting technology from the time of the Erie Canal to the present. Perhaps things would have turned out differently if it had not. Looking at nations in which government played a less active role in technology, I think we would be poorer. Like it or not, you cannot rewrite history and pretend that government contributions to technology are unimportant.

|2.5.08 @ 6:41PM|#

Ron, you fail to mention the most glaringly obvious hole in Nordhaus' argument: it was government intervention in the transportation industry that got us where we are today! About half of America's carbon emissions come from cars and trucks, and who knows how much more come from heating millions of disparate large suburban houses and buildings as opposed to more energy-efficient and smaller city apartments. With the highway system, local spending on roads (which is never financed only out of gas taxes), zoning rules that proscribe anything other than low density development, and eminent domain, the American government has hobbled every other form of transit other than the personal automobile. Reasonoids are quick to condemn liberals when they advocate for more public mass transit, but they are silent about the rules that make private mass transit seem like such a ridiculous concept. It was the American government's massive intervention that that is forcing us now to look to another massive intervention. I'm really disappointed in Reason for never addressing this obvious cause of global warming and environmental degradation...as if it was somehow the free market that got us where we are today! I think a lot of libertarians wouldn't need to lean on the "well, maybe global warming isn't as bad as they say!" crutch if they just understood that it was government intervention that indeed caused the problem to begin with.

MattXIV|2.5.08 @ 7:08PM|#

Beyond the perenial problem of the government throwing money at projects that aren't inherently viable, subsidizing one technology over another generates a substantial risk of encouraging lock-in of a suboptimal technology.

Infrastructure normally involves network effects, so the technology that grows the fastest initially will often become locked in, since the main concern middle to late adopters will have is that they may be installing infrastructure that they'll have to tear out to replace with something else later. Thus, it is very important that the technologies are competing on a level playing field initially when the network effects are minor, so the less effective technologies get shaken out in the initial consolidation.

The disbusement of the R&D subsidies, on the other hand, is generally a highly politically influenced process - which explains why probable dead-ends like "clean coal" and corn ethanol keep raking in the dollars. It also means that the distribution of subsidies for developing viable alternative technologies will be determined in large part by political pressures. If a suboptimal technology recieves a disproportionate amount of subsidy initially, it can result in an advantage that allows it to build up an "escape velocity" worth of network effects and become the dominant solution despite being inferior to the alternatives.

|2.5.08 @ 7:28PM|#

About half of America's carbon emissions come from cars and trucks

If by "half", you mean 20%, you might have a point.

With the highway system, local spending on roads (which is never financed only out of gas taxes)

If by "never", you mean 80%, you might have a point.

As for the rest of your comment... Do you really think that a gas tax that is, say, 10 cents higher to cover the difference between today's gas tax and the actual spending for roads would suddenly eliminate suburbs?

And I assure you, as much as I dislike zoning, it is not done by "the American government." It is mostly done by local governments at the behest of busybody neighbors.

In short, while you are correct that private mechanisms would have yielded better and more efficient outcomes than those we have presently, they would not look anything like the carbon-free, public-transit urban utopia you seem to want.

|2.5.08 @ 7:41PM|#

I could come with dozens of other examples.

Almost all of your examples -- especially the older ones -- are of government intrusion into purely private goods. As such, private interests would have discovered the superior technologies in due time as their costs and benefits warranted.

Let's take one example...

Steamships were built with government subsidies despite bitter opposition from the sailing ship industry.

Can you possibly tell me why this is a good thing? Long term investments in expensive shipping capital rushed to depreciation because the government is giving money to your competitor? Why in heaven's name is this desirable?

If steamships are indeed superior, they will be chosen in due course by those enterprises that find them of most value when it makes economic sense for them to do so. How can subsidies possibly improve this situation?

|2.5.08 @ 8:05PM|#

If by "half", you mean 20%, you might have a point.

No, I mean half. And according to this study it's worse than I portrayed it - it's not half of America's emissions, but rather half of all emissions!
http://www.washingtonpost.com/wp-dyn/content/article/2006/06/27/AR2006062701757.html

If by "never", you mean 80%, you might have a point.

More like 60% - straight from the horse's mouth. That amounts to an other 50% subsidy (if spending is $100, then the revenues are only $60, and $40 is over half of that). Don't be a snarky asshole, especially when you're wrong.
http://moderntransit.org/letters/budget.html

As for the rest of your comment... Do you really think that a gas tax that is, say, 10 cents higher to cover the difference between today's gas tax and the actual spending for roads would suddenly eliminate suburbs?

No - the whole idea of letting some local planning board decide how the money should be doled out is itself antithetical to market incentives. I'm just showing that even if you consider the gas tax a perfect market approximation, the roads are still heavily subsidized.

And I assure you, as much as I dislike zoning, it is not done by "the American government." It is mostly done by local governments at the behest of busybody neighbors.

While the proximate cause is local governments, they were enabled by Supreme Court rulings.

In short, while you are correct that private mechanisms would have yielded better and more efficient outcomes than those we have presently, they would not look anything like the carbon-free, public-transit urban utopia you seem to want.

Are you sure about that? You've been wrong about everything else...

|2.5.08 @ 8:29PM|#

No, I mean half. And according to this study it's worse than I portrayed it - it's not half of America's emissions, but rather half of all emissions!

That article is extremely poorly written. (It's about global warming: How can it not be!) If you look at the graphic, you see what they are measuring...

All U.S. automakers account for 45 percent of the world's greenhouse gas emissions from light vehicles.

The EIA has better numbers, presumably biased by neither the Environmental Defense Fund nor the Washington Post.

For 2005, motor gasoline CO2 emissions in the US were 1.1822 billion tonnes. The total CO2 emissions in the US were 6.0450 billion tonnes.

So the percentage of America's carbon emissions from cars and trucks is 19.56%.

I originally quoted 20% because that is the standard well-known fraction for worldwide transportation emissions. I must admit it is an accident that emissions from cars and trucks turns out to be exactly 20% of emissions in the US.

|2.5.08 @ 9:01PM|#

Hm, it seems you're right about that 45% being a bad number. However, your own math is a little off. You have to consider both motor gasoline and distillate fuel (which, I believe, is diesel - used in large freight trucks). Once you do, the total CO2 emissions linked directly to the roads is about 27%. And this doesn't take into account indirect fuel emissions enabled by auto-related subsidies: suburban single-family homes are bigger, on average, than a city-dweller's home (and thus need more materials to produce them, and more fuel to heat them). They are also not stacked on top of each other, and thus the fuel to heat one house does nothing for the houses near it. Same goes for commercial establishments - they're bigger than they otherwise would be, and more spread out than they otherwise would be, and therefore involve more energy than they otherwise would. Furthermore, some of the jet fuel emissions could be said to be caused by American transportation policy, as a lot of those trips are trips that could be made just as easily and just as quickly by rail, except for the fact that we've destroyed any chance of profitable land-based mass transit faster than the bus. The ramifications are tough to get your mind across, since transportation is essentially a complement good for every good (and a lot of services) produced in the market.

So basically, you have 50% subsidies on the roads (an important complement good to an automobile), laws that encourage low-density growth, tax-funded police patrolling the roads (I once read that about 40% of all police resources go into enforcing traffic laws), and government policies that instinctively favor auto producers. This industry alone accounts directly for over a quarter of all carbon emissions, and likely about another quarter in indirect effects. And that's to say nothing of the detrimental environmental impact of creeping suburbanization. And you're trying to tell me that our society isn't much different from what it would otherwise be??

|2.5.08 @ 9:03PM|#

You appear to be right about your 60% versus my 80%. Looking back, I now recall joe calling me on the 80% number that I put together and noting that it was operations costs alone and did not include capital costs. My apologies.

I'm just showing that even if you consider the gas tax a perfect market approximation, the roads are still heavily subsidized.

And I am saying that if you really did charge users what the roads cost, they'd be paying another 10 20 cents per gallon in gas tax. That cost is simply not remotely high enough to dissuade people from building and living in suburbs.

|2.5.08 @ 9:11PM|#

However, your own math is a little off. You have to consider both motor gasoline and distillate fuel (which, I believe, is diesel - used in large freight trucks). Once you do, the total CO2 emissions linked directly to the roads is about 27%.

I'll buy that. I recall that diesel comprises 30% of road fuel consumption.

And this doesn't take into account indirect fuel emissions enabled by auto-related subsidies: suburban single-family homes are bigger, on average, than a city-dweller's home (and thus need more materials to produce them, and more fuel to heat them).

And all of these -- except the CO2 emissions themselves -- have costs that are fully internalized. They're all private goods. And people willingly pay for them.

And you're trying to tell me that our society isn't much different from what it would otherwise be??

That's exactly what I'm trying to tell you.

|2.5.08 @ 9:28PM|#

They're all private goods. And people willingly pay for them.

People willingly pay for them at current rates, but people sure as hell don't willingly produce them! Not without huge subsidies, at least. I don't think I need to outline for you all the ways in which energy production itself (both energy for cars - mainly petroleum - and energy for heating buildings and building the constituent parts) is highly subsidized and the market is highly distorted.

And I am saying that if you really did charge users what the roads cost, they'd be paying another 10 20 cents per gallon in gas tax. That cost is simply not remotely high enough to dissuade people from building and living in suburbs.

But what about the other thing I said - that even if gas taxes account for 100% of costs, the allocation mechanism still isn't market-based?

And anyway, even when you're done crunching all the numbers and calculating all the subsidies, there's still the unquantifiable effect of zoning laws and height restrictions that make the kind of density necessary to sustain profitable private mass transit impossible. Hell, in DC you can't even build higher than the Washington Monument! Not to mention the explicit laws banning competition with local governments' transit monopolies.

|2.5.08 @ 9:46PM|#

I agree that allocation is not market-based, and I would rather it were.

In fact, if road building and maintenance were paid for directly by road users via toll or transponder, I think we would see many more miles of roads and much more efficient use of them, allowing for even more effective sprawl. You probably don't.

I do concur that, absent zoning, we would see an uptick in high rises and opportunities for carless living. But I think it would be a mild uptick.

The majority of people would still look to live in a single-family detached dwelling away from the city center. It is simply worth it to them. If paying actual market rates and facing actual market allocations meant they would have to live in 2000 square foot homes instead of 2400 square foot homes, that is a small price and a difference in degree -- not a difference in kind.

Mike Laursen|2.5.08 @ 11:14PM|#

The U.S. and British governments have made vital contributions to just about every major technology developed since 1800...

It's hard to say, isn't it, how these major technologies would have developed with no government involvement, since the government did get involved in them.

You go too far in saying that industrial standardization would be impossible without government setting the standards. We have lots of counterexamples in the modern software industry, where standards have been adopted voluntarily for the mutual benefit of the companies involved.

|2.6.08 @ 12:45AM|#

Read the article. My knee jerk reaction to the title was my usual annoyance at the apparent love Climate Contrarians have for the heavily protected centralized nuke and coal power utilities. And then I thought of all the nifty small scale freedom giving freemarket micro-power and/or off-grid technologies discussed at enviro sites such as treehugger.com

sheesh.

fortunately the article is better. Thanks Ron.

alisa|2.6.08 @ 9:02AM|#

One thing that hasn't been discussed much so far is basic research. Outside medicine, most academic science is funded by the NSF, not to mention the work done at national labs. What kind of processors and plastics would we have without the materials science work at Argonne? It's arguable that industry can fund enough of its own R&D -- though perhaps climate change is a special case since the consequences are decades away. But fundamental research is pretty much a pure public good.

|2.6.08 @ 11:13AM|#

"In a world in which billions of people remain mired in poverty and lack access to modern sources of energy, a positive environmental program stressing technological innovation and economic growth is far more politically viable."
There is a strong odor of "I'm from the government and I'm here to help." in this statement.
First we define who the poor are, then we decide that their living conditions need to be improved, and finally we decide how this is to be done. Can you spell arrogance?

Lord save me from those who want to save me.

Neu Mejican|2.6.08 @ 11:25AM|#

A source of technology that has benefited your life...
http://www.sandia.gov/

Aspects of this reseach
http://www.sandia.gov/Renewable_Energy/renewable.htm

are seen in the currently available products in the industry.

Neu Mejican|2.6.08 @ 11:25AM|#

And it will form the basis for many future products.

Neu Mejican|2.6.08 @ 11:26AM|#

More tech produced as a result of government research

http://www.sandia.gov/mstc/

Neu Mejican|2.6.08 @ 11:28AM|#

Tiny advances funded with government dollars.

http://mems.sandia.gov/scripts/images.asp

Neu Mejican|2.6.08 @ 11:33AM|#

Much of the technology needed to extract all that oil from Canadian soil comes from research done at Sandia in the 70's during the last energy crunch.

Neu Mejican|2.6.08 @ 11:45AM|#

Government supported technology development...

http://www.motorwavegroup.com/new/motorwind/

check out, in particular, the lowcost mircoturbines.

Jed Rothwell|2.6.08 @ 12:33PM|#

MikeP wrote:

"'Let's take one example...

Steamships were built with government subsidies despite bitter opposition from the sailing ship industry.'

Can you possibly tell me why this is a good thing? Long term investments in expensive shipping capital rushed to depreciation because the government is giving money to your competitor? Why in heaven's name is this desirable?"

Because it worked. Sailing ships were displaced, although it took 30 years, and the U.S. and U.K. became the world's leaders in the technology. The technology also had vital military applications. The U.S. won the Civil War in part because it had superior steamship and naval capacity, which it would not have had if ocean-going steamship technology had not been subsidized in the 1840s.


"If steamships are indeed superior, they will be chosen in due course by those enterprises that find them of most value when it makes economic sense for them to do so."

Perhaps you could prove this in a parallel universe, but that is not how things worked out in actual history. "In due course" in this case might have been after the French or Germans developed the technology and the Confederates won the war. Steamships were superior, but capitalism does not always work perfectly, because of monopolies and stupidity, and sometimes it takes an outside force such as government to correct a market aberration. Anyone who thinks that markets always work perfectly should look at Toyota versus General Motors and Ford. If the U.S. federal government does not soon force U.S. automakers to produce fuel-efficient cars such as plug-in hybrids, the U.S. will not have any domestic automakers 10 or 20 years from now.

Mike Laursen wrote:

"You go too far in saying that industrial standardization would be impossible without government setting the standards. We have lots of counterexamples in the modern software industry, where standards have been adopted voluntarily for the mutual benefit of the companies involved."

1. It is much easier to set standards in modern software than it was in the 1920s to standardize things like machine tools and bed mattress sizes. The cost of making new machines was much higher. Adjustments for the new standards had to be enforcer fairly and impartially, which could only be done the government.

2. By the 1990s, when the software industry did this, there was already a strong tradition of standardization in industry, which was founded, funded and led by the federal government.

3. The government itself invented and enforced many software standards, especially in the early years of computers. For example, a government researcher (Hopper) invented COBOL. COBOL remains one of the most widely used programming languages.

4. Organizations such as ANSI are a combination of government and private industry, unique to the U.S. Countries such as Japan have less cooperation and open collaboration of this model, and it hurts their industries. (The Japanese government did do a good job enforcing fuel efficiency standards and safety standards, which is why Toyota is eating GM's lunch, and why Japanese automobile deaths and injuries reached a 54 year low in 2007.)

In short, modern technology is complex and it requires close cooperation and investment by both the public and private sector. Countries where this does not happen are not wealthy. Countries where it happens best are the most wealthy. Perhaps, in theory, pure private capitalism works best, but not in practice.

|2.6.08 @ 1:06PM|#

The U.S. won the Civil War in part because it had superior steamship and naval capacity, which it would not have had if ocean-going steamship technology had not been subsidized in the 1840s.

This is beyond parody. Tax your fellow citizen to pay for technology that you can use to beat the daylights out of him twenty years hence.

That's quite an argument for the goodness of subsidies.

"In due course" in this case might have been after the French or Germans developed the technology and the Confederates won the war.

And if the steamship subsidies had gone to enterprises in New Orleans and Mobile rather than Connecticut or other points north, the Confederates would have been the ones beating the daylights out of the Union with their own parents tax dollars.

In this slightly alternate reality -- based perhaps on little more than what state happened to have an important Senate committee chair -- would you be arguing for the goodness of technology subsidies because without them the Union might have won the war?

Anyone who thinks that markets always work perfectly should look at Toyota versus General Motors and Ford. If the U.S. federal government does not soon force U.S. automakers to produce fuel-efficient cars such as plug-in hybrids, the U.S. will not have any domestic automakers 10 or 20 years from now.

And...? I eagerly await the problem you claim to ascribe to markets in this example.

If you are basing your arguments on national greatness mercantilism or the like, well... I am not.

But I will agree that government expenditures to advance technology for the explicit purpose of national defense are warranted. The majority of your examples are nothing of the sort.

Mike Laursen|2.6.08 @ 1:20PM|#

Perhaps you could prove this in a parallel universe...

Exactly. For the same reason we can't disprove your assertions because it is impossible for us to create a parallel universe, you cannot prove your assertions. All your arguments bet the question -- all of these technological advances happened with government subsidy, therefore government subsidies were necessary.

It's exactly the same reasoning as the guy who puts an elephant repelling device on his front lawn, and then points out that it must be working because he hasn't seen any elephants.

Jed Rothwell|2.6.08 @ 1:32PM|#

MikeP wrote:

"And if the steamship subsidies had gone to enterprises in New Orleans and Mobile rather than Connecticut or other points north, the Confederates would have been the ones beating the daylights out of the Union with their own parents tax dollars."

That is correct. That is why it is a good thing the Northern states were more technologically advanced than the Southern states. The southerners did buy state-of-the-art maritime steamships, from the British, especially The Alabama, which caused great harm to the Union. Fortunately the U.S. has Kearsarge and other ships, and on the coast it had ironclads.


"In this slightly alternate reality -- based perhaps on little more than what state happened to have an important Senate committee chair -- would you be arguing for the goodness of technology subsidies because without them the Union might have won the war?"

Perhaps someone else would, but I doubt it would be me. People do argue that the south deserved to win, even though it lost, so I suppose people would argue the other way around in a parallel universe. I have met some Japanese people who think they deserved to win WWII, although I have never met a German who wishes they had won (or who will say it aloud).


"But I will agree that government expenditures to advance technology for the explicit purpose of national defense are warranted."

This is quite impossible, because of the nature of modern technology. You can NEVER predict which technology will have vital military applications. Nearly all discoveries of the last 200 years have had both military and civilian applications. Every war since 1860 was won or lost mainly with civilian technology, such as railroads, sewing machines, and precision machines tools. As Gen. Eisenhower wrote:

". . . four other pieces of equipment that most senior officers came to regard as among the most vital to our success in Africa and Europe were the bulldozer, the jeep, the 2 1/2 ton truck, and the C-47 [DC-3] airplane. Curiously, none of these is designed for combat."


"The majority of your examples are nothing of the sort."

On the contrary, most of the examples I listed have played a vital role in war. The human Genome project has not, yet, but I can easily imagine that it might in the future, in some new horror yet to be unleashed.

Jed Rothwell|2.6.08 @ 1:51PM|#

Mike Laursen wrote:

"'Perhaps you could prove this in a parallel universe...'

Exactly. For the same reason we can't disprove your assertions because it is impossible for us to create a parallel universe, you cannot prove your assertions. All your arguments bet the question -- all of these technological advances happened with government subsidy, therefore government subsidies were necessary."

You misunderstand. You can only prove your hypothesis in a parallel universe, whereas I can point to the real world to prove that I am right. The U.S. and the U.K. took the lead in most technologies from 1800 on because they subsidized research and force-fed industry with things like steamships. Countries with weak governments that did not do this are poor. We are rich. Perhaps if you could change human nature and re-run history things would come out differently. For that matter, pure communism might work too, but here in the real world ideology-based systems that do not take into account facts-on-the-ground and common sense do not work.

The sailing ship industry fought to prevent steamships, but the government pushed it aside. The stagecoach and wagon industry in California actually tried to prevent the railroads from coming in, but the government pushed them aside. Some manufacturers tried to prevent industrial standardization, but they lost. The railroads tried to stymie the development safety standards and airbrakes, but the Congress insisted. The railroads tried to block the development of automobiles and airlines . . . but the government pushed them aside. There are hundreds of similar examples.

Today, the coal companies are doing their best to sabotage the development of wind turbines. The spread rumors, they deny global warming, they broadcast absurd advertisements. The Representative from Big Coal (D. WVa) introduced a measure that would essentially outlaw wind turbines ostensibly because the turbines kill birds. (He doesn't acknowledge the fact that coal kills ~20,000 people, and millions of birds.) Industries such as coal have enormous economic power, and clout. Without a strong government to counter-balance their power, they WILL squelch progress and prevent competition.

Of course I am not suggesting that government is perfect, or that it has caused no harm. But the U.S. and British systems work better than any other country's, and our two governments have always played a strong, central, active role in developing, subsidizing and promoting technology.

|2.6.08 @ 1:54PM|#

Every war since 1860 was won or lost mainly with civilian technology, such as railroads, sewing machines, and precision machines tools.

Exactly. And that is why government should not choose or subsidize industries for private goods. The economy is most efficient when its private interests take the risks and reap the rewards of their own choices and investments.

The nation will have more and better civilian technologies, not less -- not to mention more capital and wealth to deploy them militarily if needed -- if the government does not subsidize particular industries.

On the contrary, most of the examples I listed have played a vital role in war.

When I said "nothing of the sort," I meant that most of your examples were not "government expenditures to advance technology for the explicit purpose of national defense."

A technology developed for civilian ends that turns out to play a vital role in war does not qualify.

|2.6.08 @ 2:01PM|#

The U.S. and the U.K. took the lead in most technologies from 1800 on because they subsidized research and force-fed industry with things like steamships.

The US and UK took the lead in most technologies from 1800 on because they were the two freest economies in the world in the 1800s. Exactly the opposite of your belief.

Countries with weak governments that did not do this are poor. We are rich.

Perhaps you could cite examples of nations with free markets that ended up worse off than the US and UK because they didn't subsidize industry sufficiently.

Jed Rothwell|2.6.08 @ 2:26PM|#

MikeP wrote:

"'The U.S. and the U.K. took the lead in most technologies from 1800 on because they subsidized research and force-fed industry with things like steamships.'

The US and UK took the lead in most technologies from 1800 on because they were the two freest economies in the world in the 1800s. Exactly the opposite of your belief."

These two conditions are not opposites. A nation can have both a free economy AND also strong government support for R&D and promoting technology. That's what we have.


"Perhaps you could cite examples of nations with free markets that ended up worse off than the US and UK because they didn't subsidize industry sufficiently."

Subsidies alone are not sufficient. You must also have a government that can stand up to powerful monopolies as they emerge, and punish wrongdoers who take advantage of newly emerging, unregulated industries. The anti-trust laws were The Businessman's Bill of Rights. Unless they are vigorously enforced, small, innovative businesses will be crushed by established businesses, as often happens in Japan.

Our economic rivals in the 19th century had either weak governments or weak industry. That's why they lost out. You need both. The Confederacy lost because it had weak industry and insufficient strong central government unity.

Today, Japan has a bossy government that often interferes with the market, and unfairly promotes one technology over another, but seldom does anything to counterbalance powerful corporations. There are few anti-trust enforcers, bank regulators or health and safety inspectors. In the 1950s the Japanese government tried to stop Sony from developing transistors, whereas the U.S. government was a tremendous help to Bell Labs and others who rapidly developing transistors and later ICs. There is little serious economic competition within Japan, and widespread corporate corruption and incompetence, consumer fraud, insurance fraud, and so on. Read "Dogs and Demons" or read the Japanese headlines anytime. The 2007 Word of the Year was "[consumer] fraud." (Note that I translate Japanese into English, so I happen to know a lot about this.)

China has weak to non-existent government regulation and unregulated chaos in the marketplace. Their economy seems to be growing like the dickens, but the benefits are not reaching the broader society, pollution is out of control, there is no sign that political freedom is developing, and the situation is unstable and could lead to civil war or other extreme violence.

Jed Rothwell|2.6.08 @ 2:46PM|#

MikeP wrote:

Every war since 1860 was won or lost mainly with civilian technology, such as railroads, sewing machines, and precision machines tools.

"Exactly. And that is why government should not choose or subsidize industries for private goods."

Do you want to lose the next war?!? You want to abandon a system that has worked splendidly since 1800, in favor of an economic theory. You are bold -- or blinded by a beautiful idea.


"The economy is most efficient when its private interests take the risks and reap the rewards of their own choices and investments."

This may be true in theory -- your theory anyway. But in real life the economy is most efficient when the government vigorously promotes technology and enforces anti-trust laws, health and safety regulations. Of course free market competition, risk taking, wealth and so on are also essential! But you can't have a free market without a strong government. The winners crush the competition in the first round, and the game is over.

We know this because in countries where government is weak (such as Japan today), and in times such as the present era -- when the government is passive and allows powerful corporations to run roughshod over the competition -- the economy suffers, the gap between rich and poor widens, and things go downhill.

You base your ideas on economic theory. I base my ideas on pragmatic real-world experience and history.

I say we should do whatever works best. I don't give a fig if that happens to be a combination of capitalism and government subsidized socialism.

Pure capitalist ideology does not work, any more than communism does. People are complicated and they have history and customs and foibles. The economic system must take actual human nature into account.

Neu Mejican|2.6.08 @ 3:48PM|#

MikeP/Jed,

Ain't it all about matters of degree?
Balancing of important factors in the complex system that result in different outcomes. No single factor is the sole determiner of a societies economic success.

Stable institutions of education are at least as important as any other factor, but will not, on their own, lead to greater wealth. Same goes with the degree of government involvement of technology. There is such a thing as too much meddling, and too little.

It is not an all or nothing question.

imho.

Jed Rothwell|2.6.08 @ 3:59PM|#

Neu Mejican wrote:

"Balancing of important factors in the complex system that result in different outcomes. No single factor is the sole determiner of a societies economic success."

I agree completely! Plus, the system is so complex, no one can understand it, so to a large extent we must use trial and error. Most decisions should be left to the free market.


"Stable institutions of education are at least as important as any other factor . . ."

Right! Education is vital. Especially the education of poor people, to open up opportunity to everyone. This is difficult to achieve with a pure free-market approach.


"There is such a thing as too much meddling, and too little.

It is not an all or nothing question."

Right and right. Ethanol is the result of too much meddling, and the slow progress in cold fusion is what happens when you don't have enough meddling. Cold fusion is still at the level of fundamental physics research. You can't patent a force of nature, so there is no incentive to figure it out. Fortunately, DARPA, the Navy and the Italian government are still at it, and we may see major government support again in India, according to Nature magazine (Indian edition). See:

http://lenr-canr.org/News

Mike Laursen|2.6.08 @ 8:58PM|#

It is much easier to set standards in modern software than it was in the 1920s to standardize things like machine tools and bed mattress sizes.

Not true. Establishing software standards is an expensive, tedious process, orders of magnitude more complicated than deciding on a few standard mattress sizes.

Neu Mejican|2.7.08 @ 1:11AM|#

Most decisions should be left to the free market.

I've said it before...but here we go.

In the beginning was anarchy = no government = totally free market.

The free market tries out all kinds of innovations.

The ones that work proliferate.

One of the most successful innovations of the free market was the state, a market innovation that was successful enough to become the norm, transforming the market into the dynamo we all know and love.

As much as I respect MikeP...it shows little faith in distrubuted trial and error solutions to problems to dismiss the regulatory systems that the complex adaptive market has created for itself. These regulatory systems were created by the market, for the market, to improve the market...the same processes that created them also reign them in when they get out of hand.

Jed Rothwell|2.7.08 @ 10:17AM|#

Mike Laursen wrote:

"Not true. Establishing software standards is an expensive, tedious process, orders of magnitude more complicated than deciding on a few standard mattress sizes."

DECIDING on a few standard sizes is easy, as you say. The hard part is scrapping or rebuilding millions of dollars of equipment that was used to make the non-standard mattresses. It is also very difficult to decide on and enforce standards fairly when those standards threaten to bankrupt one manufacturer while they produce a windfall for another.

Mike Laursen|2.7.08 @ 10:53AM|#

It's strange that we're focusing on your example of mattress size standardization, since it's the least compelling of all your examples. So, it's a boon for the government to drive mattress manufacturers out of business over standardization that wasn't even driven by consumer demand. Got it. That's just dumb and wasteful, and with all your touted standardization, we still have California King and Eastern King mattresses.

Jed Rothwell|2.7.08 @ 11:29AM|#

Mike Laursen wrote:

"It's strange that we're focusing on your example of mattress size standardization, since it's the least compelling of all your examples."

There were thousands of others examples at the turn of the 20th century. I just picked that one because we are all familiar with standard mattress and sheet sizes. These standards did not fall out of heaven. They did not come about magically thanks to market forces. They were the result of careful decision making by federal officials and industry experts working together, and they cost a lot of money at first. Millions and millions of other deliberate decisions and regulations have made countless products safer, cheaper and better. Market forces alone did not do as well, which is why the market invented regulation, as Neu Mejican points out.

Of course we have had regulations for as long as civilization has existed. Houses and barns built in 1800 in Pennsylvania had to meet building standards as strict as those we have today. Codes and inspections were strict and restrictive, and builders who did not meet them were driven out of the county. (I know a great deal about that -- more than I wish I do, because I had to repair a barn built in 1790.)


"So, it's a boon for the government to drive mattress manufacturers out of business over standardization that wasn't even driven by consumer demand."

You are missing the point. They did this sort of thing without driving manufacturers out of business whenever possible. That's one of the reasons it was difficult, and why it took technical and political acumen.

Herbert Hoover had many faults, but he was not the kind of person who would use government power to arbitrarily drive corporations out of business for no reason. He was pro-business, you may recall. What customers demand are low costs and high quality. In the 1920s, the lack of industrial standards were keeping costs high and efficiency low. So Hoover stepped in and fixed the problem, with the cooperation of industry.

Hoover also did a fantastic job distributing food in Europe after WWI. He was a genius in many ways, and a great humanitarian, but he was not able to cope with the Great Depression. His memoirs reveal that he never grasped how bad the situation was.

Mike Laursen|2.7.08 @ 11:53AM|#

They did not come about magically thanks to market forces.

Nothing magical about it. The market is directed by what consumers are willing to buy.

They were the result of careful decision making by federal officials and industry experts working together, and they cost a lot of money at first.

And, of course, this process was all on the up-and-up with no industry experts vying for the standards that favored their own business interests. What exact expertise would one need to have to choose standard mattress sizes? Let's see, I already have a mattress factory that makes 39" x 75" mattresses and my competitor doesn't -- I think the government should declare twin mattresses to be one of the standard sizes.

Jed Rothwell|2.7.08 @ 12:27PM|#

Mike Laursen wrote:

"And, of course, this process was all on the up-and-up with no industry experts vying for the standards that favored their own business interests."

Nonsense. Of course they vie for favors. That is why you need impartial experts from government and from industry organizations to resolve conflicts fairly.

You seem to think that under pure, unregulated free market capitalism people do not vie for favors. They game the system, pay off salesmen, set up cartels, or do a thousand other things that regulations now prevent.


"What exact expertise would one need to have to choose standard mattress sizes? Let's see, I already have a mattress factory that makes 39" x 75" mattresses and my competitor doesn't -- I think the government should declare twin mattresses to be one of the standard sizes."

If that is how how regulations were decided, they would be unenforceable. The corporations that lose the negotiations would never agree to go along. That's how we ended up with HDVD and BluRay.

It takes expertise because you have to be fair, you have to take into account all points of view, and you have to come up with a cost effective set of standards.

Mike Laursen|2.7.08 @ 12:58PM|#

You seem to think that under pure, unregulated free market capitalism people do not vie for favors. They game the system, pay off salesmen, set up cartels, or do a thousand other things that regulations now prevent.

I think no such thing. Of course, they try to get whatever advantage they can, regulations often assisting them in doing so.

But we're straying from your assertion that government must get involved in setting standards for everything from mattress sizes to heavy equipment. I am right that it is impossible to prove your assertion one way or another by looking at the history of the United States and Britain, unless one could create alternative realities. You have a good point that evidence in favor of your position can be gleaned from comparing the history of the United States and Britain with other countries. Others on this blog have made a good point that such historical comparisons are difficult, with multiple variables that have to be considered.

In the end, you're position that your opinions are firmly grounded in objectivity are shaky. You're essential argument still boils down to government must be involved in setting standards because it has always been involved in setting standards, and I think that it should be that way.

Jed Rothwell|2.7.08 @ 4:15PM|#

Mike Laursen wrote:

"But we're straying from your assertion that government must get involved in setting standards for everything from mattress sizes to heavy equipment."

That isn't quite what I assert. Close, but, what I am saying is that experience and common sense taught people like Herbert Hoover that standards and regulations are a good idea. When they are used carefully and sparingly, they work better than pure, unregulated capitalism.


"I am right that it is impossible to prove your assertion one way or another by looking at the history of the United States and Britain, unless one could create alternative realities. You have a good point that evidence in favor of your position can be gleaned from comparing the history of the United States and Britain with other countries."

We can make other fruitful comparisons. We can compare industries before and after they are regulated; or industries that are regulated with those that are less so; or we can compare present day Japanese regulations which are weak and controlled by cartels to those of the U.S. and Europe where government plays a bigger role; or at the other extreme, we can look at China where there are virtually no regulations. (There are regulations, just as there are income taxes, but you pay a small bribe and they vanish. No one earning more than $25,000 a year bothers to pay taxes, I have heard.)

I think when you make these comparisons, you find that regulations and standards generally improve economic performance for everyone. But of course there are exceptions and standards sometimes becomes obsolete and must be changed or abolished.


"Others on this blog have made a good point that such historical comparisons are difficult, with multiple variables that have to be considered."

Very difficult indeed. No one denies that. And good regulations are difficult too. They must be used sparingly. But not to use them at all is somewhat analogous to saying that because we usually recover from illness naturally we should never go a doctor. Yes, 99.99% of good health is natural, and a sensible person does not overuse drugs. And yes, the free market naturally unimpeded usually does the best job. But intelligent intervention is sometimes a very good idea. There is no point to dying from appendicitis.


"In the end, you're position that your opinions are firmly grounded in objectivity are shaky. You're essential argument still boils down to government must be involved in setting standards because it has always been involved in setting standards, and I think that it should be that way."

Not quite. That would be an "Appeal to Tradition" logical fallacy. My argument is that our ancestors lived in a world without regulations, and they discovered, over time, by trial and error, that a reasonable level of regulation is beneficial. We should not ignore the lessons of history. Our grandparents and people like Hoover were not fools. I am conservative in that respect. I do not fix institutions that are not broken. The U.S. has been vigorously promoting technology since the Erie Canal, and we done extremely well, so I think we should continue with this tradition.

To take another example along the same lines, I would not end the prohibition of cocaine and heroin overnight. Before these substances were prohibited, they caused enormous harm. Obviously, the present set of laws and prohibitions are not working and must be adjusted. We need more treatment and less whack-a-mole. But our ancestors were not fools, and they banned these things for good reasons. We should think carefully before tossing out the laws they put in place.

Jed Rothwell|2.7.08 @ 4:35PM|#

Mike Laursen wrote:

"'. . . They game the system, pay off salesmen, set up cartels, or do a thousand other things that regulations now prevent.'

I think no such thing. Of course, they try to get whatever advantage they can, regulations often assisting them in doing so."

Regulations do often assist people who game the system. These regulations are often written by corrupt government officials for that purpose. That problem is far worse in Japan than in the U.S. Established industry cartels there write the regs to squash competition, prevent effective oversight, and rob the consumers.

Such regulations should be abolished. The public and the voters have to pay attention to these issues, and see to that regulations are fair, and applied intelligently. That's called governing and it is what we must do. We can do it well, or badly, but we cannot escape the responsibility, or pretend that unfettered free markets will always do the the job for us. As I said, that's like asserting that most illness gets better naturally, so why bother having doctors and hospitals?

Of course the economy is far too big and complex for anyone to micromanage effectively. But some goals are far too urgent and important to be left to the free market. For example, we need to stop using oil, now, immediately, because terrorists use oil money to kill us, and global warming threatens our survival. Yes, the market will gradually adjust as oil runs out over the next 120 years or so, but that's not good enough. Government and industry should have collaborated to build plug-in hybrid cars that get over 100 mpg (of gasoline, plus electricity). They should have done that the day after 9/11. CAFE standards should be 50 mpg now, and 300 mpg by 2015. This is a national emergency no time to worry about economic theory. Just do it.

|2.7.08 @ 5:22PM|#

Ye gods.

Jed Rothwell|2.7.08 @ 5:47PM|#

MikeP wrote:

"Ye gods"

Yes? How can we help you? For English, press 1 . . .

eq|2.10.08 @ 11:22AM|#

This guy is a "cold fusion" quack. Just forget him. He just doesn't get intellectual process straight. Just emotional.

Jed Rothwell|2.11.08 @ 2:34PM|#

eq wrote:

"This guy is a 'cold fusion' quack. Just forget him. He just doesn't get intellectual process straight. Just emotional."

I am a cold fusion librarian. The people doing cold fusion are all professional scientists. You apparently think they are quacks, but you are wrong. As I have pointed out elsewhere, they include The Director of the Max Planck Institute for Physical Chemistry in Berlin; two Nobel laureates in physics; the director of BARC (India's premier nuclear physics laboratory) and later chairman of the Indian Atomic Energy Commission; Bockris, Fleischmann and other authors of the leading textbooks on electrochemistry; several Distinguished Professors and Fellows of the U.S. Navy, the Electrochemical Society, NATO and other prestigious organizations; three editors of major plasma fusion and physics journals, and a retired member of the French Atomic Energy Commission.

They include researchers at over 200 world-class labs such as Los Alamos, Mitsubishi and Amoco.

They have published about a thousand papers in peer-reviewed, mainstream journals of physics and chemistry.

You will find papers from all the people and institutions above at our web site:

http://lenr-canr.org/

If you insist that all of these distinguished scientists "don't get intellectual process straight" and they are "just emotional" and should be ignored . . . then you have screw loose. Not me -- you.