In his Sunday letter to the editor, headlined “Without profit motive, all endeavors fail,” Bob Jack wrote: “Profit is the expected result of risk that investors take when they buy into development of technology and systems for a given activity, health care included. One cannot separate the delivery of health care from new medical technologies, including breakthrough drugs, that are part of the innovation cycle needed to advance the quality and effectiveness of health care.”
The reality, however, is that few private corporations in this country perform the necessary research and development to create the technologies that have largely been responsible for our high (but dramatically slipping) standard of living. It is the U.S. government — via the Energy and Defense departments, the National Institutes of Health, and the Small Business Innovation Research and Small Business Technology Transfer programs — that provides money to support research and development in government-funded national labs, at universities and in industry that are largely the driving forces for our nation’s innovation.
At one time, large-scale research was supported by great corporations such as AT&T that resulted, for example, in the development of the transistor and high-speed optical computers. But most U.S. companies no longer perform significant research or do so in an extremely limited capacity because of their short-term and myopic profit-making outlook, and the ball is dropped on the need for long-term investment to develop and improve technologies that may require decades to succeed.
Our government is shouldering much of the risk to continue our unprecedented success in science and engineering that mostly drives our economy, well-being and national security. Let the U.S. taxpayers shoulder the risks and costs of developing new technologies (just as they have done to rescue irresponsible and greedy banks) and then let corporations profit from them! What a deal!
The writer is an associate professor of physics at UNLV.
"Let the U.S. taxpayers shoulder the risks and costs of developing new technologies"
And how does the government pick winners and losers
I would certainly like to see where you got your facts for the above. Companies like General Electric spend millions of dollars every year on R & D which leads to inventions and new products. The drug companies do the same thing. Innovation is the key to progress in a company. Without invention or innovation, a company cannot produce new products, but just keeps trying to sell the "old" model to a shrinking customer base. Based on your thinking above, we would all still be riding horses or driving Model T's and your life expectancy would be about 45 years, if you were lucky. So, please tell me how the gov't has paid for all this innovation. Gov't mandates have led to business innovation in order to stay in business and meet those mandates. The gov't certainly did not supply cash, for example, to meet clean air standards, just do it or go out of business. Business had to innovate in order to survive and continues to today. You need to check your info source.
A government mandate is, well a government push on invovation. Yes, cars would have gone faster, but they would have been less safe. Government has a big role in directing [and therefore causing] invovation. It's true drug companies developed Viagra on their own, but HIV medicines and polio vaccines and those that help with other diseases tend to have government seed money behind them. Vaccine technology improves because the government buy and subsidized a large percentage of them. The success of Viagra? well, it lead to the invention of Cialis. And, a time released version..
Join the real world professor. The heavy lifting in innovation and investment always comes from the private sector. The government limits it funding to projects where the ROI is light or nonexistent but where some societal benefit is perceived. How many new oil fields
have been discovered by government. How many break-through drugs have been invented by the government. The government's policy , including the NSF, has always been to limit it's funding to areas where the private sector has little or no profit incentive. Free enterprise and free enterprise ideals have powered this nation since the beginning. The profit motive is the engine of investment and innovation which has lifted this nation over the years. This is a free enterprise nation. It will remain that way. Private enterprise builds our roads, our power plants, our houses, our military weapons and systems, our cars, our clothes, food,--look around you and see how few things are the products of government. Next time you have an MRI look at the label on the machine. Any medical device, drugs, all health care equipment, the doctor's office,on and on. Private enterprise is at the heart and core of our survival. Not government.
B.S.
BarryS--that's like saying that because your wife decides where you take a drive, that she has invented the car.
I am not sure what planet the writer lives on but the bulk of new technology breakthroughs still come from the private sector.
That is true for healthcare.
That is true for aircraft.
That is true for computer hardware and networking.
That is true for software.
That is true for construction.
That is true for manfacturing.
Tha is true for tourist industry.
That is true for ship building.
That is true for car manfacturing.
It is true that the goverment, including Nevada, spend mega-bucks on research and development.
I am confident if there was a non-bais study of payback and returns that the private R-n-D has a far far far better return than the public R-n-D.
SgtRock:
All of the advances you mention were developed before the globalist, profit-is-our-only-motive era when industry DID support research and development. We are currently coasting on our achievements made in the 1950s and 1960s and 1970s during the Sputnik era when the Soviets surpassed the US in aerospace by sending an astronaut into space. From this fear of the Soviets, President Kennedy made a commitment to fund scientific research which resulted much of today's technology (satellite, high speed communications, lasers, high strength materials such as Kevlar), etc. Read about Vannevar Bush and you may better comprehend what is obviously being missed here.
Houstonjac:
I have five ideas that might bring in millions if not billions of dollars to this country. I can't sell them to big corporations because they don't want to support any risky ideas that might not pay off. Our companies are struggling precisely because they have forgotten what made this country great - the spirit of innovation. Instead, they have chosen to outsource their labor to cheaper labor pools in India, China and elsewhere, play games with their stocks and play up hype instead of substance and quality with their products. The spirit of innovation and the chutzpah to go the distance to develop novel technologies is waning. I'm sorry but that is the reality which I would like to see change.
Houstonjac:
One more thing. Much of the technology to find oil: NMR, neutron and gamma ray detection, high strength drill bits, sonar, x-rays, radiofrequency mapping etc. etc. etc. utilized by such firms as Schlumberger were developed with basic research that was performed in Universities which WAS supported by government funding. My point stands.
brownln4:
GE does not spend what it used to on research. MRI machines came out of fundamental research that resulted in the discovery of nuclear magnet resonance (NMR) at Harvard and Stanford which was spurred from developments at the Radiation labs at MIT during WWII. Bell labs at Murray Hill has been practically shut down. IBM is a semblance of its former self in terms of research and development. How do I know? I know many of the scientists and engineers, directors of research programs, and other specialists who were let go when these companies were downsized when the CEOs of many of our most productive tech-based corporations didn't even have bachelors degrees in the fields that their companies had expertise in but had/have only MBAs and are now destroying our industrial base via outsourcing and not understanding what is necessary to maintain competitiveness and innovation.
Relax, everyone. This guy's a professor at UNLV.
All you need to get that job is a stinky suit jacket with patches on the elbows. Oh, and you also have to be a stinking Socialist riddled with guilt for being American and White.
Future:
Picking "winners and losers" is usually done via peer review which is not foolproof. But that's part of the breaks of performing research - sometimes it pays off and sometimes it doesn't. Though there is alot of politics involved in the process for funding research, at least, there is some level of professional examination of the proposals to ensure that no perpetual motion machines are being created. Considering the tremendous waste that our corporations engender with excessive and unearned bonuses for their white collar workers, as well as poorly-thought-out strategies (e.g. GM building a plant to manufacture cars in China which ended up being blatantly copied by the Chinese), our government's support for research has been the best investment our nation could ever make.
judgesmales:
Keep up the barbaric anti-intellectual vitriol. It's destroying our democracy and is going to turn us into a socialist third-world country before you know it. And, I'm not a socialist.
For the uneducated and anti-government, laissez faire folks here who are having difficulty grasping my argument, there is a book that has been published detailing the current crisis in lack of support for innovation. The book's title is: "Rising above the gathering storm" that I would strongly encourage you to read. A link to this text can be found at:
http://www.nap.edu/html/11463/11463_revi....
I wrote about these issues some time ago:
http://www.washingtontimes.com/news/2007...
Then, let's really debate not just namecall, stereotype, and discuss nothing of substance.
Michael - Your perspective is just a bit off.
"It is the U.S. government -- that provides money to support research and development"
The government doesn't have any of it's own money - it is the taxpayer's money - MY MONEY!
"Our government is shouldering much of the risk"
The government doesn't shoulder any risk - when they run out of money the take more from us.
You are an educator? How sad.
Larry5:
Government is of the people, by the people and for the people - at least in theory. Yes, the money the government spends on research IS taxpayers money. Look at the last sentence of the letter. That's why it's important that taxpayers understand the benefits to our society from scientific research.
You raised some excellent points in your letter Dr. Pravica -- but it's a waste of effort attempting to engage in a real debate with most of this crowd. No matter how many unassailable facts you present, you'll never convince them to abandon their libertarian proselytizing. They believe, as articles of faith, that governmental action of any kind is inherently bad. You'll never convince them otherwise.
I wonder how much of Mr. Pravica's income is dependent on getting government research grants. Mostly these are worthless projects designed to give an income to overeducated idiots. UNLY is not regarded as a respected institution of higher learning but as a place where the bottom of the barrel goes for employment when they are incapable of getting a real job.
Regarding jlb101's immature post: UNLV is a highly regarded "up and coming" institution. Most of my income comes from the State and I work very hard to educate our students in physics and be able to solve read world problems as many of them will be our future doctors, dentists, architects, as well as scientists and engineers. With regards to the government funding I have, I wouldn't call issues pertaining to our national security "worthless projects." jlb101: Do you have any education in the sciences or math at all?
One more point for jlb101:
One of my former students is now a graduate student at Princeton University studying energetic materials with ultrafast lasers using quantum control techniques. He also won a "SMART" fellowship from the Army for his academic excellence here at UNLV. I wouldn't call UNLV students "bottom of the barrel" if I were you. Did you ever get a college degree and if so where?
"Overeducated idiots" sounds oxymoronic, doesn't it? I guess that in jlb101's world, we should all be undereducated fools that get tricked out of our money and freedom by wealthy masters who want merely to maintain the status quo of haves and have nots and turn us into slaves.
Stick with the physics and avoid the economics. The government DOES NOT sponsor the bulk of innovation in America...not even close.
The bulk of R&D sponsored by the Government DOES NOT benefit the American people, its intended to benefit the government - ie weapons.
Weapons for the military do NOT improve the living standard for the American people.
Furthermore, government R&D may make up for a lack of private R&D in certain areas, but every dollar of government R&D crowds out a dollar of private R&D somewhere else.
Pravica,
I'm not saying that jlb101 is correct, but one anecdotal student does not prove him wrong.
Academic exellence at UNLV is an oxymoron. Nothing is excellent at UNLV.
Yes I have a B.S. in Business Administration from California State University Sacramento which in spite of it's diversity requirement is a very good business school. I also had a very successful career in the business world, which by the way was not subject to government grants or handouts, but I succeeded through hard and intelligent work. I did well enough that I no longer have to work and can enjoy a very leisurely retirement.
If you buy into the foolish crap that Obama gives you, you will be turned into both, a have not and a slave.
Pravica
Also, our "slipping" standard of living is due to poor US government economic policy, not the private sector. The bank bailout was a very bad government idea and we'll be stuck with the bill for years.
Furthermore, while you acknowledge market failures your entire article attacks the letter writer for acknowledging nonmarket failures.
Market failures occur when the private sector under provides a service/good -- usually because it is classified as a public good (non excludable , non-rivaled) which means people can benefit by it without having to pay any cost. To avoid paying for other people to benefit from their actions private actors will likely under invest. In this instance government action is likely very good.
But government suffers from some very big nonmarket failures. These mainly stem from the lack of a profit motive. Having no incentive to provide high quality, cost saving, efficient service to their customers (because government simply takes what it wants, when it wants it) government tends to over provide a very costly service that has questionable tangible benefits to the people. Government sponsored research may result in some really great life saving drug but it may also result in billions of dollars wasted on energy research that had no impact on consumption or energy savings.
You can't criticize the private sectors failings while ignoring the governments own failings. Eitherway, you can't claim the government is the primary engine of the American economy. That is just a false statement"perhaps coming from a myopic insider benefiting from government grants?
pravica: Don't waste your time on this board. It's only meaningful purpose is to aggravate the uninformed "Dittoheads".
Thank you Patrick, kind words. Saw an story on the TV news the other night where they were interviewing a new college graduate who just left college with a degree in English. He was complaining that he had no job offers and neither had any of his English major friends who graduated with him and they were unsure of what they were going to do. Sell shoes maybe. This is an example of an overeducated idiot. I am quite sure a degree in physics is not much better. If you cannot teach there are few opportunities for employment. The best majors right now are engineers of all kinds who get top bucks and many job offers. Accountants and IT are also in there too. Before you become unemployed, check into the job market and make sure you're going to be in demand.
I don't think these kids are idiots at all. I think they've been oversold the benefits of a college education. I know I was.
I was told that all I had to do was get a college degree and people would throw jobs may way. That seemed like the case when I first started interviewing for jobs, but a sour economy quickly dispelled that myth.
I learned that college CAN educate you and provide you with marketable skills. If you choose the majors that make it possible.
I think a lot of kids have been misinformed by people who mean well. Government subsidies also distort our pay off matrix as we may forgo immediate employment and training opportunities to go to college which is paid in part by someone else. For many kids going to college ends up as a wash. For some unlucky few going to college was a waste of time and money as they would have been better off developing skills in the market.
Unfortunately, it seems to me, in the effort to expand operations and increase revenue, colleges have been actively recruiting students who are not prepared to succeed in college.
In reading the above comments I can't believe the hostility. My parents were raised under the Nazi regime and worked under Hitler. The weapons research that was going on at that time was so sophisticated Hitler was on the brink of developing weapons that would have flattened the US like a pancake. Without a strong government and powerful military complex we would either be dead or doing the goose step. Many german scientists worked in US funded programs during and after the war. These programs led to some of the greatest scientific break throughs in history........just a thought relax everyone
If it wasn't for a Senator by the name of Al Gore, plus a an old classmate of mine at Caltech, plus big bad old government run DARPA, we wouldn't be having this conversation. No, wrong terminology. We couldn't be having this conversation.
No, don't get your blood pressure up, Gore didn't "invent" the internet. But when the early concept of sharing computer data across the telephone line, so that researchers in various government labs was brought to his attention, he saw a little of its potential and got the program funded.
Did I say government labs? Did you know that is where all those really neat airplanes come from? You know, like the ones that fly a kazillion miles an hour an inch above the ground and are invisible to radar. And that great video game, the Predator, that takes out automobiles and people even though the "pilot" is someplace safe in the Andromeda Galaxy ... yep, darn ol' incompetent government lab again. Imagine what great stuff we could have if only some private company invented it.
Do you have any idea what Hubble has accomplished? I mean besides the magnificent pictures? Any idea how difficult it was to build that thing?
You probably think the government effort to put a man on the moon (assuming you aren't a "birther" descendant of conspiracy nuts and "know" the whole thing was a hoax) resulted in nothing that benefits you directly.
Too bad you don't. With the miracle of the internet and broadband you have the tools at your fingertips, literally, to learn something. Use it.
zippet,
Realize one thing. Governments are very good at single minded pursuits like warfare. Destroying and killing is easy to manage. Managing 300 million independent minds with diverse wants and needs is impossible.
Many people make the fallacy that if government is good at making war it must be good at managing people. They are two very separate things.
Stan G,
Yes, yes we most likely would be having this conversation. There is no evidence to suggest we wouldn't. The internet may have come later, but it would have been developed. Furthermore, the government hasn't directed much of the internet's evolution much at all since it originally created it decades ago. This organic growth has been all private sector.
Shh, government invented twitter too. It's all a conspiracy to make right wingers think it was all developed by individuals.
Stan, Roughly 80% of federal tax revenues go for social security, medicare, medicaid and defense. If you throw in interest on the debt you are almost at 90%. What is going on is a battle between young and old, rich and poor. It has nothing to do with 300 million minds or managing people. The young don't want taxes and the old need safety nets so they don't starve. Most of my family still lives in Europe and these debates are going on all over because of the aging of the industrialized world.
The government has never designed or built any significant airplane. The government draws up some specifications and it goes to private companies for bids. For example:
F-14 Grumman Aircraft
F-16 Lockheed/Martin
F-22 Lockheed/Boeing
Space Shuttle Rockwell/Boeing
Could you see an aircraft that Barney Frank, Chris Dud and Harry Reid had a hand in designing. It would never get off the ground.
Emthree and WillieTanner:
Thank you for your words of support. Tragically, there is so much ignorance of how our country really works and the crisis that we are only beginning to enter that I feel I must try to educate those who no not how to debate but also hide behind anonymous names if only so that they don't intimidate those who dare to write, speak, ad otherwise participate in true debate. The problem is that many Americans have forgotten just what it was that made this country the greatest nation on Earth and I'm afraid that we're rapidly losing our ability to remain that way. We also need to require more science and mathematics in our schools so that the kind of ignorance I'm seeing posted here is not allowed to fester.
jlb101:
It's nice to know that you have the capability within you to actually conduct a civilized discussion occasionally. But Cal State Sacramento? Better than UNLV? I don't think so not that I intend to knock down schools as you have done but I guess I can assume that you didn't take much physics. My students never have a problem getting a job when they graduate in physics. We have students at Caltech, Princeton, and in real jobs such as Acton Research, etc. And I have a nice track record of getting my students great jobs. I also have trained a number of nonphysics majors who are now doctors (who may someday have to treat you in your "leisurely retirement") as well as pharmacists, architects, and many others. But obviously, you don't know who and what hires physicists and why (or you wouldn't have made such a ridiculous comment as you did about students being unable to find jobs) so I will excuse you for this. However, I will just say that UNLV has alot of famous and powerful alums, many of whom are integral to our city.
BTW jlb101:
I am not a supporter of any of the mainstream parties in this country being one of the millions of disenfranchised voters who really have no choice in our "democracy." So I don't "buy" into what Obama or George Bush, or Bill Clinton, or any of our corporate-sponsored "elites" who realistically differ little from one another say. Ron Paul seems to have the most sanity and logical ability to break us free from the enslaving globalist Oligarchs who are destroying and exploiting our nation. But it clear that restoring our Republic is not going to be easy.
Jlb101:
I guess you still haven't read and understood my letter. Who commissioned Northrup Gruman, Honeywell, Lockheed Martin, Raytheon, Boeing, etc.etc.etc. to make the aircraft and high tech parts? The US government. They paid for the research and development.
Patrick_R_Gibbons:
Many of the military developments made in WWI are still with us as civilian benefits (e.g. the Haber process to take convert nitrogen gas into ammonia). During WWII, advances were made in radar (e.g. landing of planes), synthetic rubber, synthetic gasoline, microwave technology. And then, post WWII with people such as Vannevar Bush, the US government funded research projects that created the laser, NMR/MRI, high strength materials (e.g. carbon fibers), the internet, nuclear energy, etc. etc. etc. Industry was a very valuable partner and innovator as well. Many projects were joint between the government and industry. However, in the 1980's and beyond, there was a noticeable shift in corporate priorities which was becoming "globalized" away from research and development - especially fundamental research - and more toward fluff - high bonuses for people with the golden "MBA" who had the gift for gab and making friends at the gold course but who knew little else especially about the need to support research and development and who, as a result, ended up destroying companies that had decades of competitive expertise. And now, third-world countries are catching up and even stealing our technological know-how. As fewer and fewer Americans are pursuing science, engineering, and math degrees, the future of our ability to innovate and compete and thus the future of our economy is in serious doubt. Many of the drugs created today that e.g. fight cancer were developed with funds from the NIH. That's a fact. Having a physics degree isn't just useful for getting a job in physics but for having demonstrated ability to solve some of the most difficult problems that exist and having the intellectual fortitude, discipline, and confidence to patiently learn and not fear the unknown.
StanG:
I have no idea what you are trying to say in your last meandering comment about the Predator and other aircraft and am not sure if it was directed at me. Nevertheless, WHO PAID FOR ALL OF THIS RESEARCH AND DEVELOPMENT YOU DESCRIBED???? Please read and digest fully my letter before you respond to it.
Thank you!
Patrick_R_Gibbons:
At this tragic moment in our nation's history, is there really any difference between government and big business as our government leaders seem to be mostly in the employ of "special interests" many of which are organized by our corporate and other "elites?" Yes, our government needs total overhaul as does our "private enterprise" system which encourages the laws of the jungle where sharks eat the guppies (including stealing their intellectual property) and financial theft continues with people like "Mad(e)off" causing misery to millions of people. My point is that there is a nasty trend with our business leaders who have no problem making billions in virtual profit, evading their tax responsibilities like traitors by setting up their headquarters in the Bahamas, but then expecting the taxpayer to bail them out when times are not going to well. It is these same greedy good-for-nothing business "leaders" who are too cheap to support research and development to maintain their competitiveness but (like the case of MCI), just benefit from the hard research of AT&T to make their enormous profits. This has got to change for the future of our nation!
Thank you, Professor Pravica, for your great letter and insightful comments. I hope you will
comment more on this site.
Thank you, teamster! I will!
pravica: I'll reassess my opinion that you're wasting time on this BB. Your comments might intimidate the Jerry Springer and Glenn Beck supporters off the site and thereby upgrade the level of intelligence to where real debate can take place.
Thanks.
WillieTanner:
Thanks for the vote of support. Many Americans (especially those we have seen on this BB) have forgotten how to debate and instead insult, scream, distract, distort, among many other bad habits which contributes nothing to debate but instead polarizes people further. This is also what we typically see in the mainstream media and that's exactly what some of our "elites" want - polarized/divided, angry, arguing, stressed-out plebian masses ("rabble" in the words of a bank executive) who blame anything under the sun but the real causes for our current predicament. For the sake of our future, this has to stop and I would like to try to change this in any small way possible - one person at a time.
Have a great day!
Pravica
You've got most of it wrong. You see corporations as the enemy, and maybe it is because you're a myopic insider you accuse other people of being. And its not that politicians are just responsive to the needs of big business, politicians regularly engage in shakedowns against corporations in order to blow more money on pet projects for politicians to increase the likelihood they get re-elected. And its not like corporations all hate big government either, some of them love it because government is the best weapon at destroying their competition.
1) Madoff was investigated by the government more than a dozen times and government found him innocent until Madoff's own son brought them the evidence. Government failed.
2) I already told you about nonmarket failures which you seem ignore. Government wastes money and there is no bones about that. Companies find tax shelters (The US is the biggest on the planet by the way) so they can increase their profits. Profits don't just mean more bonus money for CEOs they mean more income to hire workers, pay workers more, pay investors, or return investments back into the company to improve their products. If you don't innovate someone else will and they will put you out of business -- that is of course unless government steps in to protect.
3) Big government kills. It's no surprise that the nations socialist countries have seen hundreds of millions of their citizens killed by famine or died unnecessarily. The more intrusion into the economy the less wealth can be created. Less wealth means a lower quality of life. It means fewer dollars to spend on innovation.
If the government spent $100 billion on a product that saved 10,000 lives a year you would undoubtedly cheer.
Maybe you would point to the greedy private sector which spent just $10 billion in the same year, creating a product which saves just 5,000 lives.
But more than likely you wouldn't notice that it cost the government $10 million per life saved while the private sector did it for $2 million per life saved.
It is very difficult for government to provide accurate cost benefit analysis on the research they fund (let alone any government program). Even when the cost benefit is known it is unlikely the government will shut down wasteful programs.
The more dollars that are wasted are more dollars that can't be invested elsewhere in the economy. Dollars are merely a representation of time and skill - they are scarce resources. Becoming wealthy and prosperous means you have to conserve scarce resources by making as much as possible from as little as possible.
Wasting scarce resources means you increase poverty and decrease the likelihood that you may solve future or unseen problems.
You also probably don't realize that by taxing and regulating everything you can get your hands on you drive away private sector innovation by driving up the cost.
FDA drastically increases the cost of developing new drugs. (even with the subsidies the cost is high but the subsidies provide an incentive for private companies to care less about the cost).
Getting rid of the FDA would most likely drastically increase private sector medical research
But you want to have it "both ways" heavy regulation, heavy taxation and heavy subsidies.
Of course this might not bother you, since you are the direct beneficiary of such subsidies.
Your policy preferences probably don't achieve the same result (I bet we'd have more innovations and advances with less government). I do know that your policy preferences leave everyone else worse off with less income.
Patrick_R_Gibbons:
You've written alot in your last three posts but said little. You are obviously anti-government but you are being myopic in not recognizing the deep corruption both in business and government that honestly make the two entities differ little. To suggest abolishing the FDA is unbelievable! In China, private industry has run amok and even Americans are suffering from Chinese products (melamine, contaminated drywall, medicines) with very little regulation. Without the FDA, EPA and other regulatory organizations, Americans would be perishing in droves from pollution (e.g. Love Canal), snakeoil "remedies," and contaminated food (e.g. beef with Mad Cow disease). Business has only one motive: maximizing profit. Government (at least in theory) if of the people, by the people, and for th people. Government is supposed to look out for the people's best interest. Does it always? No because of the lobbyists, special interests, etc. But is that something we Americans should ceaselessly remind our elected officials and strive for? YES. There was a recent news story that I include a link to that perfectly illustrates the points brought up in my original letter:
http://www.dailybreeze.com/latestnews/ci...
Patrick_R_Gibbons:
One more thing: to attempt defend someone as evil as Bernie Madoff is deeply disturbing. He was convicted of swindling investors out of billions of dollars. There was a Greek-American I think employed by the SEC who tried to alert his superiors and they neglected his pleas. So what? That case demonstrates that government doesn't regulate enough. Just as prior to the Great Depression, that is precisely why everything is so messed up - lack of regulation. If government won't police big business (where some business's have the annual profits greater than the GDP of some nations), WHO WILL? The globalists? The Libertarians? Give me a break! The point here that is totally missed is that we need a healthy balance between taxation, regulation, and personal freedoms. Pure hyper/globalist-capitalism doesn't work and neither does pure socialism. We need a mix like in Japan or Sweden. Our nation is so divided at the moment that we're unable to achieve this balance.
Pravica,
You simply don't get it. You are reading, but not comprehending what is being said.
I've already discussed the problems with the market and I've talked about the problems with the government.
You are still unwilling to way the benefits against the costs. There is ample evidence to suggest that the FDA kills far more people than it saves. It gives you piece-of-mind to think that they are protecting you from bad drugs, but the regulatory process not only slows and drastically increases the cost of producing innovative medicine, it literally kills people.
I suggest you look into this (while also looking up the definition of myopic).
PS, I never defended him. Again this seems to be part of your reading comprehension problem. I said the US investigated him a dozen times and FOUND NOTHING. He was doing wrong, the government's extensive regulatory framework failed to find the evidence even though the private sector had been collecting data and sending on the SEC for years. We've got a massive regulatory framework and you seem to think that because Madoff did what he did for years that we had none. This is simply a massive factual error on your part.
PS, Japan has been in a 20 year economic funk. And Americans have 30 percent more wealth than the average Swede and 38 percent more than the average Japanese person.
Pick again.
We've also never had an unregulated capitalist system. The closest we ever had was a 20 year period in the late 1880s that saw a rapid increase in the standard of living, a decrease in poverty, rising wages, and decreasing prices.
PS, yet again, if you don't want special interests taking over, stop advocating big government. The more power you give the government to take or regulate the more you're going to get special interests lobbying to grab a piece of the pie.
great thread! Mr. Gibbons is missing an important point in his global economic analysis. Japan has the oldest population on earth and no immigration. The US has nearly 80 million aging baby boomers. The cost of taking care of these elderly folks is the main cause of the worlds deficits and reduced productivity.Half the federal budget goes to the elderly. The emerging battle isn't ideological. Old folks want safety nets so they don't starve and young people don't want high taxes. Government is stuck in the middle.