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That's exactly what I am suggesting. See, VCs, angels et al are investing their money or other people's money for the sole purpose of turning it into more mone
by pj 18y ago
That's exactly what I am suggesting.
See, VCs, angels et al are investing their money or other people's money for the sole purpose of turning it into more money.
A government run investment firm can have a much broader view of success than simply 10x returns on capital investment.
Roads, bridges, and dams themselves for example are not profitable, but they enable a more productive society. The benefits of parks, museums, etc are largely unquantifiable, yet there is a perceived benefit.
A public wireless cloud infrastructure for example would enable synchronization of traffic along major corridors, reducing exhaust, fuel consumption, and time delays. It may not produce a profit, but it will improve our entire economy. We could automate 50,000 miles of rail roads, 20,000 miles of interstate. That would do a lot for our economy and our productivity.
A project like that though, is probably much bigger than any VC firm or group of angels. Also, we don't really /want/ competition to build something like that, we want collaboration. Private capital is competitive. How do we get everyone working together on benevolent projects that may not turn a big profit directly, but could enable social profit for the whole?
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- jacoblyles 18y agoAnother famous argument by Mises is that it is hard to figure out what is a socially profitable investment in absence of market prices. You pretty much just have to close your eyes and guess. The government currently doesn't justify each of the thousands of projects it has in such a manner. I'm assuming we want the benefit of each project to be greater than the cost. The bigger the program, the more unlikely that is to be the case. The critiques of the planned economy are applicable here.
- pj 18y agoThe critiques of the planned economy, I'll have to look that up. Sounds interesting. I see your point. I suggest we reduce risk by investing in many small projects run by small numbers of individuals, but very focused. To the first paragraph, I have this sense, no numbers really, but a sense that collaboration is becoming more required over time. Look at nobel prize winners and how often prizes are shared over time. I don't know what that function is over the long term, but we appear to be in an upward trend over recent history. Collaboration at this level is difficult on a global scale and across national and linguistic barriers. Which ideas are worth rescuing from the global valley of death? Big ideas that will or will not affect billions of people for decades to come. Some who haven't even been born yet.
- david927 18y agowhat about something like this? http://www.me-vc.com http://www.me-vc.com
- JesseAldridge 18y agoThat's pretty different from what we're talking about, but still looks quite interesting. The legal issues seem like the big problem with something like that. If you could figure out how to make it work... well that could be pretty huge.
- anamax 18y ago> A government run investment firm can have a much broader view of success than simply 10x returns on capital investment. Yes, a govt run investment firm can look for opportunities to (1) grease the right palms so that a specific congress critter is re-elected (2) Make sure that a congress critter's friends make money. (3) Employ said congress critter's idiot cousin. .... And, the folks running said investment firm won't take a hit if none of their investments make sense. And, the "investment" money is provided at the point of a gun so whether or not you think their plan makes any sense, you get to pay for it. Never confuse intent with effects.