Posts from January 2004

Mike Puckett argues that…

Mike Puckett argues that Tommy Gibb was correct to attribute the existence of my personal computer to the space program—not because the space program invented computers, exactly (it didn’t) or even because it invented the integrated circuit (IC), which eventually made small, personal computer systems practical (it didn’t invent that either), but rather because the federal government acted as an anchor customer for the first several generations of integrated circuits until the industry was well-established enough that it could begin to produce ICs for applications other than guidance systems for missiles and for the space program. That much is true; but so what? Does Mr. Puckett think that ICs never would have reached the mass market if the government had not bought early, expensive ICs? If he does think this, then he must also think that there is some market reason why it would not have been efficient to bring ICs into large scale production—i.e., that individuals would have freely decided that the money was better spent elsewhere. But if individuals decided that, then what good argument is there for taking people’s money in taxes, and using it to push ICs onto the market before they do people any good? Wouldn’t the money be better spent on whatever goods and services the firms and individuals in the market determine to be more important than propping up an immature and costly technology?

If, on the other hand, Mr. Puckett thinks (as I do) that there would have been a market for ICs in numerous burgeoning fields — such as the developing field of consumer electronics, or, for that matter, in a private space exploration program (!) — then wouldn’t rational entrepreneurs invest in the capital (i.e., large scale fab plants) necessary to produce ICs at a low enough cost to be feasible on the private market? And in that case, wouldn’t they have been more likely to begin producing ICs at a low cost and a high quality of work sooner than they did—since firms and individuals on the free market have to economize their purchases, and therefore will only buy ICs, and goods using ICs, that deliver superior quality at a low price?

This is a small part of the application of a general principle. It is a principle that people on the Right used to acknowledge, sometimes: that markets work, and government bureaucracy doesn’t. Of course, government agencies can end up producing something or another useful, given billions and billions of dollars to burn through. But think of how much could have been produced if those billions were in the hands of individual consumers and entrepreneurs whose living depends on making the lives of those consumers better! Think of how much sooner and better technological advances come when the people who are doing the R&D are focused on quality of life for the consumer rather than sweetheart government contracts.

If free markets and peaceful private enterprise are Leftist principles, then sing me the Internationale! Government programs may be good at blowing things up, but if you want to build things, you’d best stick with the free market.

Mr. Puckett goes on to point out that Mr. Mackey’s article contained factual errors (among them, that Bush did not mention his plans for the expansion of the space program in the State of the Union address). Fine; Mr. Puckett is quite right to argue that Mr. Mackey should be more careful when he writes an Op-Ed column. But what has that got to do with whether or not the space program should be privatized, and whether or not Mr. Bush’s electioneering with billions of your hard-earned dollars and mine is justified? I cannot see anywhere that Mr. Puckett argues that point — although he does dismiss the point by saying “this article was typical leftist Bush hating, America hating dreck.” But let’s set the dime-store psychoanalysis of Mr. Mackey’s motives aside. The relevant question here is whether he is right or wrong. Is the space program Constitutional? If so, what article or amendment authorizes it? Is a government-funded space program more beneficial than free spending and investment on the free market? If so, why is taking people’s money and shoving it into a government space program more effective than allowing people to choose how to spend their own money, and to set up (subject to market constraints!) freely funded space exploration projects on their own, if they so decide? Is the broken window fallacy not a fallacy when very large rockets are involved? If not, why?

These are substantive issues raised by Mr. Mackey’s column that deserve to be addressed—not brushed off by appeal to some weird Right-wing identity politics. If someone gives an argument that George W. Bush (or the American government as a whole) is doing something bad, that argument is not adequately refuted just by pointing out that it does have a negative conclusion. Negative conclusions may be the result of unreasoned hatred; or they may be the result of reasoned argument. If you think the argument is a good argument, then isn’t that a reason to endorse the conclusion, rather than darkly speculating on the motives of the person giving the argument? If, on the other hand, you think it’s a bad argument, then why not skip the speculation about motives and just show that it’s a bad argument by addressing it? Either way, it seems, the argumentum ad hominem is entirely beside the point.

Charles Johnson
cwj2@eskimo.com
Freelance Academic, Auburn alumnus
http://radgeek.com/

Several of the respondents…

Several of the respondents to Mr. Mackey’s article could benefit from a better understanding of politics and economics.

There is, for example, “Bubba Roby,” who apparently thinks that columns by Lew Rockwell (a capitalist libertarian who runs the Ludwig von Mises Institute in Auburn, and the web site www.lewrockwell.com) frequently appear on the DNC website, and that Democrats often make arguments based on bashing John F. Kennedy’s government spending; or Matt McCay, who apparently thinks that the Tenth Amendment is a bunch of “liberal crap” (it is a “liberal” amendment, I suppose, in the sense that George Washington, James Madison, Thomas Jefferson, etc. were all “liberals”—that is, it comes directly out of the classical liberal tradition of liberty and limited government—a tradition which both Right-wing conservatives and welfare state “liberals” discard today.)

There are also the arguments by Tommy Gibb, Space Cowboy, and others that funding space exploration through tax dollars and government bureaucracy has led to great innovation. Of course, the space program has led to great innovation (although some of the claims—such as Mr. Gibb’s claim that electronic computers, which were invented in the mid-1940s, were due to the American space program, which was initiated in 1958—cannot be taken entirely seriously). But a more fundamental point needs to be made: as Frederic Bastiat pointed out in his essay “What is Seen and What is Not Seen,” government expenditures are frequently defended by the following specious logic: of course, when the government takes billions of dollars from group A and gives them to group B, group B (in this case, NASA) is probably going to be able to do some worthwhile things with it. But what is NOT seen are the hidden costs of the transfer: all of the things that group A could have done with the money if it had not been taken from them. Think of how many technological advancements would have been possible if those billions of dollars were not taken for NASA, but rather freely spent and invested in technological efforts where success is determined by market efficiencies rather than bureaucratic say-so. Would that have produced a greater level of technological achievement and a better quality of life than the government transfer program? Well, of course we don’t know for sure — the redistribution prevents us from ever finding out. But history and economics certainly furnish us with plenty of reasons to think that markets are efficient and responsive to the needs of the people participating in them; it furnishes us with very few reasons to think the same of government bureaucracies.

One special case of this sort of specious reasoning is the Keynsian fallacy endorsed by “Space Cowboy,” who claims that taking massive amounts of money to spend on NASA will actually grow the economy “Oh, the waste! All that cash…billions…to be deposited on the face of Mars. Actually, it’ll all be spent here on Earth…mortgage payments, college tuition, investments in communities…but, I digress…” Of course, it is true that the money will be spent on Earth (that is why it is called transferring money rather than burning it up). But the mere fact that money is moving around does not mean any sort of real economic growth. (Imagine a government program in which billions and billions of dollars were taken from individuals in order to fund a vast make-work program in which people make mud-pies for $100/hr. Of course, there would be tremendous amounts of money moving around in the economy as a result of this transfer—and mud-pie makers would have lots of money to spend on cars, houses, college, etc. But the people from whom the money was taken could have used it for all of those tasks without the government taking the money and giving it to the mud-pie makers. And the mud-pie makers will have spent their time making a huge pile of mud-pies rather than working for firms on the market that produce things that consumers want. In the end, then, billions of dollars have been moved around, and untold man-hours have been used that can never be gotten back, and all for what? A big pile of mud-pies. Suffice it to say that this doesn’t strike me as the best way to go about growing wealth in a society.

Charles Johnson
cwj2@eskimo.com
Freelance Academic, Auburn alumnus
http://radgeek.com/