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Can someone here who happens to be enthusiastic about this idea enlighten us and explain why the federal government would be a better investor than private enti

Can someone here who happens to be enthusiastic about this idea enlighten us and explain why the federal government would be a better investor than private entities?

dangoldin 18y ago
Well for one the government can take a longer term view than a typical VC. As an example, imagine if the government focused on alternate energy years ago. Then when oil increased in price we'd be in better shape to make a transition. Also, a lot of technology comes as a by product of working on something for the long term. Just my 2 cents.
- corentin 18y ago
  > As an example, imagine if the government focused on alternate energy years ago. You mean, things like biofuel subsidies? > Also, a lot of technology comes as a by product of working on something for the long term. Yes, whether it's funded by the government or not.
  - Prrometheus 18y ago
    It should be noted that pharmaceuticals being researched today by private corporations will not see market in the United States for 10 years.
    - palish 18y ago
      Why is that relevant? Is your implication that a government-funded pharmaceutical company would be more efficent? If so, why? Just curious.
      - corentin 18y ago
        No, he's just saying that private companies can focus on the long term as well, if it's in their interest.
        dangoldin 18y ago
        That's true but I think the pharmaceutical industry is an exception due to all the regulation. If it were possible to market drugs in 5 years instead of 10 most companies would focus on the 5 year drugs. With a 10 year drug there is a lot of uncertainty and is a reason there has been a lot of mergers in the pharmaceutical industry over the past few decades. A big company will contribute a sales force to sell the smaller company's products and then will just acquire them if things are going well.
    - Retric 18y ago
      10 years is still not long term.
      - unalone 18y ago
        Not as long as something like the government could sustain, definitely. People with really long-term plans might get incubated. Am I allowed to make Bene Gesserit jokes on HN?
      - corentin 18y ago
        It's longer than two presidential mandates in the US.
        Retric 18y ago
        I was down modded for saying 10 years is not long term but at 25 most people need to think in terms of a 40 year retirement horizon. I am 28 and I am thinking about the cost of heath care in my 80's which is 50+ years from now. So excuse me for saying this but most people under thirty need to be looking 50+ years ahead because there is a good chance we are going to be alive then. Now most people in power tend to be older which may shorten their views but 100 years is not all that long when you start thinking the people that come after you.
  - dangoldin 18y ago
    Well that's just an extreme case. I don't mean subsidies but actual investment in R&D. But most VC companies won't invest in something for the long term. Do you think any VC company would have invested in a company trying to get into space in the 1960s?
    - byrneseyeview 18y ago
      You should probably have known what you were talking about before you said that. Space-related stocks did incredibly well during the 1960's. Some of them -- satellite companies -- did, in fact, get into space.
      - dangoldin 18y ago
        Hmm I did not know that but thanks for letting me know. Well let me rephrase my question. Would those private companies have been so successful if the government did not allocated funding for space research or focus on it's own space program? I don't know the answer but I think they'd be related.
        dangoldin 18y ago
        Maybe I can modify my initial point to state that once the government shows a long term interest in an industry companies will be more prone to enter it.
- yummyfajitas 18y ago
  Indeed, imagine if Nixon launched Project Independence, a "Manhattan Project" for clean energy, with the goal of achieving energy self-sufficiency by 1980. Imagine he launched this sometime around, I dunno, November 7, 1973. Just think where we might be today! http://www.energy.gov/about/timeline1971-1980.htm http://www.energy.gov/about/timeline1971-1980.htm Amusingly enough, the actual Manhattan Project did give us a clean source of energy. We just don't want to use it.
  - Prrometheus 18y ago
    People seem to have forgotten that the Federal Government has pumped $billions into green energy research over the past decades, with little to show. I haven't heard ahy good arguments for why Obama will have more success.
tortilla 18y ago
Government can take a longer term investment. Example: Space exploration
- corentin 18y ago
  Do you really think the government created and funded the NASA, the DARPA, the Manhattan Project and the NSA for the love of science? (I certainly won't deny all the really cool side effects they created, though.)
  - lacker 18y ago
    Of course not, but I'm okay with doing something that only somewhat resembles love of science.
    - corentin 18y ago
      I'm sure scientists and engineers would have discovered and created as many cool things if the money was spent on peaceful research projets instead of being confiscated by the government.
- byrneseyeview 18y ago
  The House is the part of government that initiatives spending. Anything that takes more than two years is beyond their time horizon.
- hugh 18y ago
  The space program isn't really a great example of long-term thinking though. Its crowning achievement was the Apollo Project, which only took about eight years -- less than the time it takes Boeing to design a new airliner, for instance. Once we'd got to the moon we figured out we didn't have a long-term plan for what to do when we got there, so the money dried up and wound up getting spent on one short-term boondoggle after another: Skylab, the Shuttle, the International Space Station et cetera. NASA's budget and primary focus change frequently, and every time there's a grand new plan to do something new (a new launch vehicle or a trip to Mars) the money will evaporate soon afterwards leaving behind either nothing (e.g. the last few Mars plans) or a crippled project which never really does what it was originally supposed to do (e.g. the shuttle or the ISS). Meanwhile, huge slices of the NASA budget are spent idiotically thanks to Congress (e.g. the spreading of NASA facilities over various states with powerful senators). NASA has had some great successes (the occasional huge success is pretty much unavoidable if you gather thousands of very smart people and billions of dollars) but as a poster child for government's ability to take a long-term view it's pretty dim.
jhancock 18y ago
Doesn't have to be better; just more and different. Besides if its government run, it might have a strict form associated with getting funding. There will probably be a part of the application where you need to specify your revenue model. If you leave it blank, no funding. That might qualify as "better".
- corentin 18y ago
  Obviously. The federal government is not used to give huge amounts of no-strings-attached taxpayer cash to irresponsible people...
liuliu 18y ago
No. National angel fund can be found in Russia and China. They are not work very well. Basically because the managers are more care about the safety of the money, they are not tend to invest business that will spend and revenue tens of millions in future. They invest 50~100k$ roughly and expected to get back in 3~5 years with ~10% revenue.

Can someone here who happens to be enthusiastic about this idea enlighten us and explain why the federal government would be a better investor than private entities?

dangoldin 18y ago

Well for one the government can take a longer term view than a typical VC. As an example, imagine if the government focused on alternate energy years ago. Then when oil increased in price we'd be in better shape to make a transition. Also, a lot of technology comes as a by product of working on something for the long term. Just my 2 cents.

corentin 18y ago
> As an example, imagine if the government focused on alternate energy years ago. You mean, things like biofuel subsidies? > Also, a lot of technology comes as a by product of working on something for the long term. Yes, whether it's funded by the government or not.
- Prrometheus 18y ago
  It should be noted that pharmaceuticals being researched today by private corporations will not see market in the United States for 10 years.
  - palish 18y ago
    Why is that relevant? Is your implication that a government-funded pharmaceutical company would be more efficent? If so, why? Just curious.
    - corentin 18y ago
      No, he's just saying that private companies can focus on the long term as well, if it's in their interest.
      - dangoldin 18y ago
        That's true but I think the pharmaceutical industry is an exception due to all the regulation. If it were possible to market drugs in 5 years instead of 10 most companies would focus on the 5 year drugs. With a 10 year drug there is a lot of uncertainty and is a reason there has been a lot of mergers in the pharmaceutical industry over the past few decades. A big company will contribute a sales force to sell the smaller company's products and then will just acquire them if things are going well.
  - Retric 18y ago
    10 years is still not long term.
    - unalone 18y ago
      Not as long as something like the government could sustain, definitely. People with really long-term plans might get incubated. Am I allowed to make Bene Gesserit jokes on HN?
    - corentin 18y ago
      It's longer than two presidential mandates in the US.
      - Retric 18y ago
        I was down modded for saying 10 years is not long term but at 25 most people need to think in terms of a 40 year retirement horizon. I am 28 and I am thinking about the cost of heath care in my 80's which is 50+ years from now. So excuse me for saying this but most people under thirty need to be looking 50+ years ahead because there is a good chance we are going to be alive then. Now most people in power tend to be older which may shorten their views but 100 years is not all that long when you start thinking the people that come after you.
- dangoldin 18y ago
  Well that's just an extreme case. I don't mean subsidies but actual investment in R&D. But most VC companies won't invest in something for the long term. Do you think any VC company would have invested in a company trying to get into space in the 1960s?
  - byrneseyeview 18y ago
    You should probably have known what you were talking about before you said that. Space-related stocks did incredibly well during the 1960's. Some of them -- satellite companies -- did, in fact, get into space.
    - dangoldin 18y ago
      Hmm I did not know that but thanks for letting me know. Well let me rephrase my question. Would those private companies have been so successful if the government did not allocated funding for space research or focus on it's own space program? I don't know the answer but I think they'd be related.
      - dangoldin 18y ago
        Maybe I can modify my initial point to state that once the government shows a long term interest in an industry companies will be more prone to enter it.
yummyfajitas 18y ago
Indeed, imagine if Nixon launched Project Independence, a "Manhattan Project" for clean energy, with the goal of achieving energy self-sufficiency by 1980. Imagine he launched this sometime around, I dunno, November 7, 1973. Just think where we might be today! http://www.energy.gov/about/timeline1971-1980.htm http://www.energy.gov/about/timeline1971-1980.htm Amusingly enough, the actual Manhattan Project did give us a clean source of energy. We just don't want to use it.
- Prrometheus 18y ago
  People seem to have forgotten that the Federal Government has pumped $billions into green energy research over the past decades, with little to show. I haven't heard ahy good arguments for why Obama will have more success.

tortilla 18y ago

Government can take a longer term investment. Example: Space exploration

corentin 18y ago
Do you really think the government created and funded the NASA, the DARPA, the Manhattan Project and the NSA for the love of science? (I certainly won't deny all the really cool side effects they created, though.)
- lacker 18y ago
  Of course not, but I'm okay with doing something that only somewhat resembles love of science.
  - corentin 18y ago
    I'm sure scientists and engineers would have discovered and created as many cool things if the money was spent on peaceful research projets instead of being confiscated by the government.
byrneseyeview 18y ago
The House is the part of government that initiatives spending. Anything that takes more than two years is beyond their time horizon.
hugh 18y ago
The space program isn't really a great example of long-term thinking though. Its crowning achievement was the Apollo Project, which only took about eight years -- less than the time it takes Boeing to design a new airliner, for instance. Once we'd got to the moon we figured out we didn't have a long-term plan for what to do when we got there, so the money dried up and wound up getting spent on one short-term boondoggle after another: Skylab, the Shuttle, the International Space Station et cetera. NASA's budget and primary focus change frequently, and every time there's a grand new plan to do something new (a new launch vehicle or a trip to Mars) the money will evaporate soon afterwards leaving behind either nothing (e.g. the last few Mars plans) or a crippled project which never really does what it was originally supposed to do (e.g. the shuttle or the ISS). Meanwhile, huge slices of the NASA budget are spent idiotically thanks to Congress (e.g. the spreading of NASA facilities over various states with powerful senators). NASA has had some great successes (the occasional huge success is pretty much unavoidable if you gather thousands of very smart people and billions of dollars) but as a poster child for government's ability to take a long-term view it's pretty dim.

jhancock 18y ago

Doesn't have to be better; just more and different. Besides if its government run, it might have a strict form associated with getting funding. There will probably be a part of the application where you need to specify your revenue model. If you leave it blank, no funding. That might qualify as "better".

corentin 18y ago
Obviously. The federal government is not used to give huge amounts of no-strings-attached taxpayer cash to irresponsible people...

liuliu 18y ago

No. National angel fund can be found in Russia and China. They are not work very well. Basically because the managers are more care about the safety of the money, they are not tend to invest business that will spend and revenue tens of millions in future. They invest 50~100k$ roughly and expected to get back in 3~5 years with ~10% revenue.