21–30 of 73 posts
I'm tired of these articles. Seriously. Government has funded hi-tech through the military for the last 70 years. That's not a secret and we wouldn't have what we have now with out it. The government knows this and the large corporations who benefit from it know it. Corporations are not willing to take on the risk to sink billions of dollars to develop a technology which may or may not pay out. Plus once it does pay…
That is not necessarily true, and in fact is often false. That is called the 'quantity theory of money', and for all its faults even mainstream economics doesn't buy into that anymore... It does appear intuitive - if there is more money in existence then existing money is worth less, right? There's even an identity that 'proves' this, PY = MV. Well, no. For price rises to be the case, the economy must be both at full capacity and full employment. It is also thinking about the problem statically, assuming that the amount of goods and services in the economy does not change to respond to an increase in demand.
In the real world, economies actually have a lot more capacity to absorb extra money than people think (many people are spooked by cases like Zimbabwe and Venezuela, whose problems in reality were caused by completely different factors). And the Austrian mistake of assuming that monetary expansion == price inflation is dangerous, because if implemented the kind of policy leads to effectively controlling inflation by causing unemployment.
I'm tired of these articles. Seriously. Government has funded hi-tech through the military for the last 70 years. That's not a secret and we wouldn't have what we have now with out it. The government knows this and the large corporations who benefit from it know it. Corporations are not willing to take on the risk to sink billions of dollars to develop a technology which may or may not pay out. Plus once it does pay…
Take your pick of any of the major US industries. Chances are the successful players they take a lot in subsidies. None of the Musk companies are really outliers in this, they just get a lot more attention (e.g. GM, Boeing, and GE all take a lot of subsidies).
Interesting that he mentions Elon Musk when his companies are literally kept alive by billions in government subsidies and contracts. I don't like the binary view of "Give all power to corporations, with no government intervention" and "Let the state control all means of research and access" The ideal is clearly in between, where the state should break up monopolies and punish companies that have detrimental external…
There was an article just a few days ago by Farhad Manjoo entitled Google, Not the Government, Is Building the Future (https://www.nytimes.com/2017/05/17/technology/personaltech/g...) that I think captures your viewpoint well. I'd like to spend some time digesting it, after which I'll likely write some thoughts.
> When the government floods the economy with cheap money printed out of thin air, it distorts market indicators, making many unprofitable projects appear profitable. Oh, is that a new one? It's the first time I read someone stating that when VCs get high on drugs and spend their money on stupid ideas, it's because of something the government did.
It's not new at all. It's actually fairly easy to demonstrate. I recommend Murray Rothbard's America's Great Depression[0] from 1963. The quick hit is this: A. US Monetary policy provides large banks with extremely cheap capital B. Large banks competing with each other in the free market must make use of that capital C. Only so many investments are good investments, because in the end, there's only so much consumptio…
His "analysis" harks back to economics of the 1800s, similar to Marx, where you would try to understand the economy by intuition, using nothing more than the english language. It turns out if you don't rigorously test your ideas you can use the english language to make a case for all sorts of loopy theories.
Interesting that he mentions Elon Musk when his companies are literally kept alive by billions in government subsidies and contracts. I don't like the binary view of "Give all power to corporations, with no government intervention" and "Let the state control all means of research and access" The ideal is clearly in between, where the state should break up monopolies and punish companies that have detrimental external…
Government does engage into efforts/projects that end up being wasteful. But, market forces should not be heralded as panacea of there being no-waste. Every private sector bankruptcy is wasteful for its investors. Yahoo, HP, Former Dell, Anderson Ton of examples of failed efforts, pure waste, nepotism, bribery and downright illegal (civil/criminal) behavior in private sector. I look at it this way... The will of the…
People tend to forget that when talking about waste. Almost every project, company, idea will end in failure. Pointing at the successes around us is a case of survivorship bias. Government projects fail all the time. Company projects fail all the time. Personal projects fail all the time.
So, looking at failures is really useless, it tells us nothing. In the end we have to look at return on investment. If the government spends $1 billion and $500 million is completely wasted, yet they get a $700 million return on the other half, that's not a bad deal. It's even better if that is money that private industry would have never invested in said technology.
And private industry is just as apt to chase bubbles leading to massive losses. When it becomes more profitable for private industry to invest in speculation in the short term a bubble occurs almost every time, followed by large economy damaging losses.
This supposes that the only things worth allocating resources to are things which would be successful in the market place. He mentions public goods in this essay so I know that he's aware of them, why does he ignore their existence here?
>Shifting focus from the public sector to the private, the idea that entrepreneurs and corporations are somehow worse at innovating, or don’t invest enough in R&D, is also called into question by many examples to the contrary. Like SpaceX, the aerospace company founded by Elon Musk with the goal of one day colonizing Mars,which recently accepted a $1 billion investment from Google and Fidelity.
Tesla Motors Inc., SolarCity Corp. and Space Exploration Technologies Corp., known as SpaceX, together have benefited from an estimated $4.9 billion in government support, according to data compiled by The Times.
http://www.latimes.com/business/la-fi-hy-musk-subsidies-2015...
Hmm. He also presupposes that public R&D spending will drive out private R&D but that is actually an open economic question. (lots of studies showing them to be complements and lots showing them to be substitutes)
This short survey demonstrates that existing empirical studies do not allow for a definitive conclusion regarding the sign of the relationships between publicly and privately funded R&D. Hence, it is still an open empirical question as to whether public R&D funding increases or decreases privately funded R&D. In order to answer this question, more research with more comprehensive datasets is needed.
http://aei.pitt.edu/6736/1/1195_30.pdf
>As Ludwig von Mises so eloquently put it...
Ah come on, I am so tired of libertarians whose entire economic education comes from reading other libertarian blogs online. Please quote some living economists, maybe even an economist who is still publishing papers. When will we realize this (specific) sort of libertarian for what they are, a utopian. The market can't solve every problem, that's why we have governments in the first place.
I'm tired of these articles. Seriously. Government has funded hi-tech through the military for the last 70 years. That's not a secret and we wouldn't have what we have now with out it. The government knows this and the large corporations who benefit from it know it. Corporations are not willing to take on the risk to sink billions of dollars to develop a technology which may or may not pay out. Plus once it does pay…
Government does engage into efforts/projects that end up being wasteful. But, market forces should not be heralded as panacea of there being no-waste. Every private sector bankruptcy is wasteful for its investors. Yahoo, HP, Former Dell, Anderson Ton of examples of failed efforts, pure waste, nepotism, bribery and downright illegal (civil/criminal) behavior in private sector. I look at it this way... The will of the…