“Sixteen Nobel Laureates in Physics and sixteen industry leaders have written to President George W. Bush to urge increasing funding for physical sciences, environmental sciences, mathematics, computer science, and engineering.” So starts an article in the American Physical Society newsletter. It goes on to argue that “unless remedied, [the funding problems] will affect our scientific and technological leadership, thereby affecting our economy and national security.” Now let us overlook for the moment the obvious fawning over “national security”. Everything these days affects national security (which means that the government is afraid of everything), hence every petition to the state for cash must mention this important “issue”. Surely, President George W. Bush, the great and powerful man, understands the seriousness of the situation with respect to this no doubt trifling problem of insufficient funding and will fix it as soon as it is brought to his attention. What the wicked bureaucrats have maliciously overlooked, our wise and compassionate God-king will immediately correct.
Very well, but what is the rationale for the state to fund and even initiate its own research and development efforts? The official objections to laissez-faire run as follows.
Objection 1. Suppose that such and such theorem is proven or that such and such discovery is made thanks to government funding. Now the results are available to all, free of charge. Surely, knowledge does not need to be economized, hence the more people are in possession of it, the better. Only the government can ensure that no private individual can selfishly keep some piece of knowledge secret. Let the benefits of scientific exploration be spread far and wide.
It is true, this objection continues, that if all subsidies to science and technology were to cease, that the money thereby freed would be available for other uses. But such spending nevertheless makes us richer, and most people would prefer to live in a society in which the government spends money on physics and math than in one in which it does not.
Objection 2. Further, it may be that the external benefits of a scientific discovery are such that they in some sense outweigh the costs of the subsidy. Such is alleged to be the case with government agencies such as the Centers for Disease Control or with government efforts to develop a car engine that produces lower emissions compared to the internal combustion engine.
Objection 3. Further, the doctrine of Merchantilism posits that protecting domestic industries against foreign competition is the path towards prosperity. If true, then subsidizing R&D is no different than corporate welfare of any other kind and is beneficial to the nation.
On the contrary, It is unjust to take private money by force from those who are not willing to indulge the scientists’ desire to search for abstract knowledge or to produce some amorphous positive externalities.
I answer that, As Murray Rothbard has pointed out in Man, Economy, and State, it is the available capital that determines the rate of economic growth: …the limits at any time on investment and productivity are a scarcity of saved capital, not the state of technological knowledge. In other words, there is always an unused shelf of technological projects available and idle. This is demonstable by the fact that a new invention is not immediately and instantaneously adopted by all firms in the society… [M]ost entrepreneurs are not innovators, but are in the process of investing capital within a large framework of available technological opportunities. Supply of product is limited by supply of capital goods rather than by available technological know-how.
It is probably true that too much research is being produced in physics and math, as it is in economics.
Reply to objection 1. We do not in fact know whether or not having X number of physicists is better for the whole nation than having Y number of physicists because the government cannot engage in economic calculation. It is likely, however, that in physics, like in any other state-subsidized enterprise, there is vast overproduction of research.
Reply to objection 2. Occasionally government discoveries do get picked up by the private sector, but what governments are most interested in are technologies that destroy person and property, control, and imprison. Private individuals have few uses for such machinery.
Murray Rothbard once argued that the government should not be allowed to collect economic statistics so that it becomes blind and incapable of attempting centrally to plan the economy. Why not prevent it from collecting scientific statistics and data as well, including that which comes from biological research? This way we reduce our chances of dying from the state’s biological weapons.
As far as cars are concerned, it should be noted that the government’s preoccupation with lower emissions actually detracts from the task of creating a superior energy source. It is impossible to predict where the next breakthrough comes from. The future car engines may be based on technology whose production of low emissions is merely a small benefit compared to its other virtues, such as greater efficiency or low cost. The resources spent by the government on such research are best left in the hand of private investors and entrepreneurs.
Reply to objection 3. Mercantilism, Ludwig von Mises writes, is the doctrine that “the gain of one man is the damage of another; no man profits but by the loss of others… is entirely wrong with regard to any kind of entrepreneurial profit or loss, whether they emerge in a stationary economy in which the total amount of profits equals the total amount of losses or in a progressing or a retrogressing economy in which these two magnitudes are different” (emphasis removed).
In sum, in a free society freedom ought to extend to scientific research as well.
July 24, 2003
