Another Business Myth

I’m getting more than a little tired of the right-wing propaganda about how everything would be better if business did it.  While I’ll happily admit that sometimes government does get in the way, more often than not the reason it gets in the way is because lots of people get tired of powerful businesses running over people, the environment, and public health in general in pursuit of power and money. Government may indeed go too far at times, but the motivations behind those acts are spurred by the excesses of business.

As for the myth of “business creativity,” as pointed out in Mariana Mazzacuto’s book, The Entrepreneurial State, the basis for a great many vital corporations, particularly in the United States, was created by government funding on research and development. The U.S. armed forces pioneered the internet, GPS positioning, and the first voice-actuated computerized assistants, not to mention significant early funding for Silicon Valley. Scientists in publicly funded universities and laboratories developed the touchscreen and the HTML language, and the U.S. government funds almost 60% of pure basic research in the U.S.  The U.S. government even lent Apple half a million dollars before it went public.  A grant from the National Science Foundation funded the research that produced Google’s search algorithm.  U.S. pharmaceutical firms have reaped billions from the results of government-funded research. This is far from new in U.S. history.  The transcontinental railway system was built on the basis of federal land grants to railroads, and the federal government effectively prototyped and tested not only ironclad vessels with the U.S.S. Monitor, but proved the efficacy of the screw propeller over paddlewheels.

There is a reason why government funding is necessary for research, and that reason is simple.  In business terms, pure R&D is “wasteful.”  It discovers more often than not what doesn’t work, and even when a successful outcome occurs, that research may not further the corporation’s goals. In addition, too narrow a targeting of pure research is often a recipe for failure. But… as Mazzacutto’s book also points out, those countries that spend the least on government-funded education and R&D, even in the industrialized world (such as Greece and Italy), are the ones suffering the most in today’s economy, and that the United States, which has historically funded more education and R&D, has recovered far better than other countries. But that is likely to change because American company companies are largely abandoning basic research, and political pressures are reducing federal government R&D programs and grants.

In short, a whole lot of that so-called blue-sky, ivory-tower, “wasteful”, and useless government-funded research pays off big time… and that’s something that business, the far-right, and too many other Americans still don’t get… or don’t want to.    

2 thoughts on “Another Business Myth”

  1. Jim says:

    What is the old saying? “Penny wise and Pound foolish”

  2. Thomas says:

    Even those that support financial investment in research often want it to be in areas that will “productive” and “useful”, “applicable” in some way. The problem with this is that we do not know in what ways knowledge will be used in the future, about topics that today seem esoteric and and not of immediate interest.

    My favorite example of this is illustrated by a quote from G.H. Hardy in his book A Mathematicians Apology, published in 1940. Talking about the area of number theory, the pertinent part reads, “…both Gauss and lesser mathematicians may be justified in rejoicing that there is one science at any rate, and that there own, whose very remoteness from ordinary human activities should keep it gentle and clean.” An area that this mathematician viewed, so recently, as remote from our ordinary lives now plays such an integral role in our every day life, as the basis for internet security and other areas.

    My point is that we cannot know what seemingly purely academic area of research and knowledge will have great application in the future, be it 10, 50 or even 100 or more years in the future.

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