I fully support the entrepreneurial spirit of this nation. However I note that many individuals who tout the values of “free markets” often forget that their success may not be entirely attributed to their ego-driven self-made assertions. The fact is much of the business success by smart, motivated, innovative people, was achieved by standing on the shoulders of others who laid the groundwork before them – this includes significant benefactions made possible through government investment.
It is a fact that many successful commercial enterprises would not exist today without the initial investment of government projects. Some undertakings were simply too large, excessively complex or otherwise beyond the scope, abilities or resources of the private sector. Government instigated projects have been essential in fostering many private commercial industries existing today. Let me offer a few examples:
The Railroad System
In 1862 President Lincoln signed the Pacific Railroad Act (1) authorizing congress to issue to the privately held Southern Pacific and Central Pacific railroads, 6,400 acres of FREE land (later doubled to 12,800) and $48,000 in government bonds for every mile of track built. The railroads then sold portions of their land to arriving settlers at huge profits.
Today Congress still authorizes funds to support Amtrak passenger service, funding the upgrade of track and infrastructure to private railroad companies which also benefits the railroad’s primary source of income: freight revenues.
Interstate Highway System
The Dwight D. Eisenhower National System of Interstate and Defense Highways otherwise known as the Interstate Highway system, was authorized by the Federal Aid Highway Act of 1956. The cost of construction has been estimated at $425 billion (in 2006 dollars), making it the largest public works project in history.(2) Interstate commerce, in the form of commercial trucking, depends almost entirely on the highway system.
Dams and Irrigation
The Federal Power Commission in 1920 enabled construction of federal dams on the Colorado and Columbia rivers, leading directly to public/private competition for production and sale of power.(3) The Columbia Basin Project of irrigation canals and aqueducts which directly supports commercial agriculture is estimated to have cost $1,687,000,000 alone.
Space program
Far too risky for most private companies to venture, the US Space program has resulted in monumental economic, scientific and technological returns, far exceeding the initial investment. The space program represents significant revenue for American corporations such as Honeywell, Northrup, Locheed, Douglass and a long list of other technical and engineering companies. It is estimated that for every dollar spent on the space program, the U.S. economy receives about $8 of economic benefit.(5)
The Internet
The Internet we know today (not invented by Al Gore) started out as The Advanced Research Projects Agency Network (ARPANET). The network was funded by the Defense Advanced Research Projects Agency (DARPA) of the United States Department of Defense for use by its projects at universities and research laboratories in the US.(4) Today thousands of private companies, large and small, depend on the Internet for their existence.
Nuclear Power
Privately operated nuclear utility power plants would not have been able to develop the nuclear fuel in use today were it not for the Manhattan Project.
The list continues: the Panama Canal, the San Francisco-Oakland Bay Bridge as well as government agencies which directly support commerce such as the National Weather Service, the U. S. Postal Service and the Federal Aviation Administration.
So when we ask, what has the government ever done for us? Well, there's the aqueduct...
References:
1. Wikipedia: Pacific Railroad Act
2. Wikipedia: Interstate Highway System
3. University of Washington Library: "Grand Coulee: Harnessing a Dream" (book excerpt)
4. Wikipedia: ARAPANET
5. Freakonomics.com: "Is space exploration worth the cost?"
16 comments:
Great post! I have absolutely no idea where conservatives believe all our infrastructure came from. With their hatred of government I have to guess they think our roads, bridges, water systems, schools, electrical grid, and everything else used to make us a first world nation came from magic fairies.
A few times I have heard it mentioned that this attitude comes from aging baby boomers who feel the Grim Reaper drawing near and want to protect their property in their old age. They feel anything that does not immediately provide them direct comfort is wasteful.
My in-laws hold that view in spades.
The general idea is that this insane hyper-conservative belief will not change until the baby boomers pass on.
On a related note, the Romans knew how to build things, too! Their stadium has lasted nearly 2000 years with little maintenance. We can't build one in Minnesota for any amount of money that lasts more than 30 years. Maybe we could learn a few things from the Romans.
and the sanitation...
Cute video.
And great post.
I'll admit it. I've always been for big government. It seems today's elite don't care anything for the masses and although big government messes up a lot it doesn't have to be that way.
BeachBum Well I am a Baby Boomer; I've spend a lifetime paying into the system, so I am not going to be very sympathetic if I am told at the end of the game that what I paid for isn't there when I need it.
But yes, there is a general myopia about government programs; people tend to view the one's they don't depend on as discretionary - keep MY program, the other guy's... well suck it up.
Jono We did, concrete was developed by the Romans. I think stuff we build is designed to have a limited effective lifetime, though. How does one engineer for the distant future? The SFO Bay Bridge is a good example; at it's time it was thought to provide adequate capacity for future generations. Earthquakes provided us a wake-up call.
Rubye I've worked in private business and in government and had my mythologies about both dashed by experience. I like to quip: "I've never met a poor or unemployed Libertarian".
And yet...
We made very little progress between Ancient Rome and the Victorian Age. Then, suddenly, the world erupted with progress. Most historians attribute this not to the scientific revolution, which happened 200 years earlier, but to capitalism.
Sure, some government projects work very, very well. And then there's the post office.
Don't forget that NASA is essentially on the cut list now. The whims of the populace can make progress difficult.
and now businesses demand concessions and subsidies to set up shop in a new jurisdiction and governments are only too happy to meet the demands.
and if the demands aren't met it's off to china or some country with a cheap labor force and no safety regulations.
Doc I think that Capitalism and scientific advancements are tied to one another is a good thing.
I'm not that critical of the Post Office, actually. I've never had a piece of mail lost, and when you think of the millions of physical items they get from point A to point B a day, it is still a remarkable achievement. I've had lots of e-mails never make it to their destination.
And yes, I posted recently about the hangaring of our Space Program. We have essentially publicly abdicated our position in the world as a leader in technology and innovation. We are too busy worrying about the sex lives of our fellow citizens. The USA will be relegated to the dustbin of history as the rest of the world world passes us by.
Billy I read somewhere that in most communities where Wal-Mart has been established, though they collect sales taxes from their customers, they KEEP the tax as part of their revenue... an arrangement made possible by eager local governments to attract business.
I find it telling that the people who cry the loudest against "Big Government" are the same folks who want the government to control female reproduction, define marriage, and require invasive vaginal ultrasounds. I can't imagine any government bigger than the one that regulates and controls its citizens' most private lives.
But when government forces companies to comply with environmental regulations that, say, require them to not pump carcinogens into ground water that people drink, they cry foul.
"Big Government" is, apparently, all relative.
Great post!
Dissenter I find the same hypocrisy; no cry of Big Government when huge subsidies go to the oil industry or subsidies to land owners to NOT develop, farm or otherwise make their land productive.
Big gov't is quite a necessity to keep our massive numbers moving forward. No idea why some toil with the notion of downsizing it because it gets in their way.
Cognitive Dissenter has it right on the money. So many anti-big government folks want government to be in charge of the most personal and private areas of our lives, but only in ways that THEY believe are appropriate. I support government investment in infrastructure, but I believe that private businesses which benefit from this should be made partners with government. We as taxpayers should have some ownership interest in these projects that we have provided for the business. As Jono mentioned, here we are having a huge fight over a stadium, with millionaire players, multi-millionaire team owners, and billionaire businesses (the NFL) showing up in private jets to beg for taxpayer money to build them a stadium.....or they will leave. Surprising to me, but I agree with the anti-tax folks on that one.
Heidrun It gets in the way of unlimited profits. I sometimes wonder if corporations wouldn't market rat poison as baby food if they thought they could make a profit doing it... or government didn't prevent them.
BackRow I'm with you on the municipally supported sports arenas... just look at the Roman Colosseum today. Who pays for that? The tax payer, but think you can get a season ticket? [laugh]
Europe, Japan, China have found a way to create supportive government-private partnerships. But then they do it for the benefit of the society; a concept that is "foreign" to us.
I do get tired of people who carp about the government endlessly. As if the country could magically run itself.
SecretAgent But this is precisely what the Libertarian stance is, government not only is not required, it gets in the way - the Market will decide.
It works like this: a child is horribly killed because of defective tires; so the word gets out not to buy that brand of tires. The only problem is, what if it's not someone else's nameless child but instead it's YOUR child who gets killed?
Libertarians seem to be unable to develop that level of empathy outside their own comfort zone. It's why I say I have never met an impoverished Libertarian.
It's why I say I have never met an impoverished Libertarian.
Well, the ones I've met who aren't that well off financially seem to labor under the delusion that they would be wealthy by now if it weren't for those darned big government liberals over taxing and over regulating them. What Bill Maher called the "Joe the Plumber syndrome."
I try not to listen to rhetorical nonsense.
Too much science is heading into the private sector. Science that I believe should remain in the public domain.
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