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A public good, the public good

In the beginning, there were public goods. The deer killed by the hunter – was not his individual property. The mushrooms and hazelnuts gathered by the women – were not their individual property. Individual property of tradeable goods did hardly exist. Nowadays it sometimes seems (DSGE models!) as if public goods hardly exist. Via June Sekera some news about a new journal, The Public Goods Post. It’s about public goods.

June

To begin with…

How do we talk about the loss of public goods – clean drinking water, affordable college education, public libraries, safe bridges all across America?

How can people even see the multitude of essential products and services they get from the public economy, since those things are often invisible, or unrecognized until they are taken away, or are veiled by free market proselytizers and privatizers? What name can we give to all those essential public products that come from what we call “government,” now so maligned?

At the Public Goods Institute we are launching the Public Goods Post to address the question of public messaging, the problem of invisibility, and the degradation of our common wealth.

Go here to read About Public Goods and what they are. Go to our Website to find news and information about public goods. Read below for our first issue of the Public Goods Post.

 

Debunking the Narrative of Silicon Valley’s Innovation Myth
Forbes | Bruce Upbin 

“The real innovation engine in the global economy is not the entrepreneurial class blazing capitalist trails through the thicket of government red tape and taxation. No. The real engine of innovation is government.” Sussex University economist Mariana Mazzucato’s “case study for myth-debunking is the iPhone, that icon of American corporate innovation. Each of its core technologies–capacitive sensors, solid-state memory, the click wheel, GPS, internet, cellular communications, Siri, microchips, touchscreen—came from research efforts and funding support of the U.S. government and military. Did the public see an iPhone dividend? Not really.”
The High Return on Investment for Publicly Funded Research
Center for American Progress | Sean Pool and Jennifer Erickson
In order for the U.S. to maintain its role as an innovation-driven economy, “government must provide three key public-good inputs that allow innovation to blossom: investments in human capital, infrastructure, and research.” The authors cite and summarize the contributions of influential research funded by the U.S. Government through the Dept. of Energy Labs, The National Science Foundation, The Human Genome Project, The Defense Advanced Research Projects Agency and the Apollo Space Program.

Markets, States, and the Green Transition
The American Prospect | Fred Block 
“… [U]nder-appreciated state involvement is true of many new technologies and sectors, but it emphatically describes the necessary transition to renewable energy. Private entrepreneurs contemplating investment in green energy face a chicken-and-egg problem. Technologies either do not yet exist, or they do not exist at a competitive price … Unless government intervenes on the supply side—to promote the innovation that is too risky for private entrepreneurs—and on the demand side—to accelerate creation of mass markets for green sources of energy—private industry cannot get the job done.”

Innovation: let the good risk-takers get their reward
The Guardian | Mariana Mazzucato and William Lazonick 
Mazzucato and Lazonick write that, “the advanced economies of the west are in deep trouble. Growth is slow or non-existent, income distribution is highly unequal … [and] the crucial question is how to reform policy so that the relationship between risk and reward is one that supports long-run growth rather than undermining it.” They point out that taxpayers are the real venture capitalists; taxpayers fund the riskiest investments in the “knowledge economy,” but it is shareholders who receive recognition and profit for reputedly bearing the risk.

The Seeds That Federal Money Can Plant
The New York Times | Steve Lohr
“Government support plays a vital role in incubating new ideas that are harvested by the private sector, sometimes many years later, creating companies and jobs.” The author cites a report from the National Research Council that finds nearly $500 billion a year of revenue at “30 well-known corporations … [can] be traced back to the seed research backed by government agencies.”

Why Steve Jobs Might Have Failed at Government Innovation
Governing | Ron Littlefield
“[One] of the biggest differences in the private and public sectors when it comes to innovation is this: While failure followed by a surprising climb to success is the subject of legend in private enterprise, government leaders are typically not given such latitude … [they] must dream big and then act boldly with the clear knowledge and understanding that failure is not without repercussions … Public servants stake their livelihoods on outcomes, and must be prepared to live with the consequences if the outcome is less than expected … [W]e should ask ourselves the question: Would Jobs or others who failed at their initial goals have been given the chance to succeed and be innovative if that initial failure had occurred in government?”

Imagine spending a day without the Internet and GPS
Continuing Innovation in Information Technology | National Research Council
The internet and GPS (a U.S.-owned utility) are among many innovations that have been funded by the U.S. Government.  The authors of Continuing Innovation in Information Technology write, “fundamental research in IT, conducted in industry and universities, has led to the introduction of entirely new producer categories that ultimately became billion-dollar industries.” Underscoring the impact of government’s outsized role in creating the dominant technologies of the 21st century, the authors of this report ask readers to imagine a day without information technology. “This would be a day without the Internet and all that it enables … A day without digital media … A day during which aircraft could not fly, travelers had to navigate without benefit of the Global Positioning System (GPS), weather forecasters had no models, [and] banks and merchants could not transfer funds electronically…”

In Depth
Fred Block
Fred Block is a Research Professor of Sociology at the University of California at Davis. His recent work has focused on documenting the substantial role that the federal government plays in technology development across the United States economy.
His landmark book, State of Innovation : The U.S.  Government’s Role in Technology Development, co-edited with Matthew R. Keller, contains a series of case studies that describe this innovation system.
Mariana Mazzucato
Mariana Mazzucato, Professor of Economics at The University of Sussex, is a leading documenter of the federal government’s role in innovation.
She has published an open source e-book, The Entrepreneurial State  and has been an active public speaker on the topic. See the link for her TED Talk below.

The Public Goods Post has been created and organized by June Sekera, Founder and Director of the Public Goods Institute; and Research Fellow at the Global Development And Environment Institute, Tufts University.

  1. March 15, 2016 at 4:31 am

    To paraphrase Margaret Thatcher, ‘how can there be public goods when there is no society to create or display them?’ Was ever a dumber thought ever thought? Anthropologists and historians both have warned for years that by destroying public life (and thereby public goods and services) human collective life is harmed or even extinguished. The answer back from economists and “policy makers” has always been the same – real creativity and invention only comes from individuals pursuing their own dreams (or nightmares) without public (read government) interference. Government’s primary, some say only job (reverse interference, if you like) is to protect and support these “entrepreneurs” and those who invest in their works. Even dumber thoughts! As George Herbert Mead and other social psychologists pointed out years ago (something historians have emphasized for 4,000 years) humans exist only “in relation to …” The isolated human is a fiction, and used as Thatcher and others like her used it a dangerous fiction. We are on the cusp of creating such dysfunction in human relationships as to make collective life difficult to sustain in any form other than “buy/sell” and “superior/inferior.” In that democracy and equality have no place. Humans have no place.

    Ripley: What was your special order?
    Ash: You read it. I thought it was clear.
    Ripley: What was it?
    Ash: Bring back life form. Priority One. All other priorities rescinded.
    Parker: The damn company. What about our lives, you son of a bitch?
    Ash: I repeat, all other priorities are rescinded.

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