No time to lose picking winners
Dogma continues to dog civilisation.
An example is the market-forces mantra that governments should resile from picking winners, because they invariably get it wrong.
Such dogma flies in the face of the wealth of examples of governments getting it gloriously and magnificently right. From penny postage to the internet, winning concepts abound that owe their success not to the free market but to visionary government leadership.
In fact a foundation of technological progress, interchangeability—the ability to mass-produce interchangeable parts—owes its kick-start to government action. Tellingly, this technological advancement was in pursuit of the goal of more and better weapons. Specifically the insistence on interchangeability by the United States war department when placing an order for 20 000 pistols. Unprecedented consistency of operation, and utility of being able to swap out failed or damaged parts in the battlefield, helped ensure that the first industrial age war, the American Civil War, took an unprecedented toll, including nearly a third of all white Southern men aged 18–40.
Similarly, it was another defining war, World War Two, that harnessed nuclear fission, unleashing its terrible wrath on the residents and workers of Hiroshima then, three days later, Nagasaki—achieving what seven months of firebombing and the deaths of half a million people had failed to.
But there are less-troubling examples: Aircraft, radar, sonar, weather and communications satellites, computers, transistors, integrated circuits (chips), the internet, solid matter computer displays (LED, LCD, plasma), antibiotics, genome sequencing and the human genome project—these were all kick-started, or given crucial life-support, by governments picking winners.
Of course, free market dogmatists only object to the notion of democratically elected governments picking winners when those winners involve concepts that put people or the planet ahead of profits. The dogmatists are entirely happy, for example, for an unelected bureaucracy, the New Zealand Transport Agency, to ignore all scientific advice and to continue its obsessive building of motorways for fossil fuel –gulping, carbon dioxide –belching juggernauts. Such is the power of the transport agency that few working professionals will criticise its strategy, for fear their consultancies will be sidelined from the only game in town. Similarly, few politicians dare question the wisdom of the hallowed ‘roads of national significance’, judging that unless they appear approving of the agency they will be ignored by it.
It is a far from unreasonable fear. A onetime Rodney District Council infrastructure manager attempted to engage the agency over its highway plans regarding Warkworth, responding to the community’s exasperation with the Hill Street intersection. His intention was to ascertain the agency’s big picture, and then proceed to identify what interim improvements could be made to ease the congestion, whilst forming part of the eventual solution involving, as it must, a new bypass.
The agency’s response to this rational and constructive approach: It simply refused to discuss its plans. And never mind ignoring a council’s senior manager, the agency has on occasion refused to grant an audience to an elected mayor.
The Chicago School theory of economics, now definitively discredited, had it that consumers, by rewarding the most efficient companies, were the hand of god shaping the most efficient of economies, and that elected governments had no business sullying this perfection by intervening to regulate business activity. Never mind that, as time went on, the school’s godfather, Milton Friedman, showed he was never happier than when the government he was advising was unelected, and was employing shock tactics to crush local opposition to corporatism.
What occurs in Aotearoa, where the government transport agency operates largely beyond the control of parliament, and in the interests of business, is pure Friedmanism—the agency featherbeds its free-enterprise trucking industry friends, whilst refusing to fund the infrastructure needed for the low-energy, low-emission alternative: Rail.
With stock markets taking a bath and the world economy taking its second dip, the Friedmanites insistence that unfettered market forces produce healthy economies has proved to be bereft. But even if the wheels had somehow magically stayed on unregulated economies, the patent deficiency in the Friedmanite approach is the lack of deliberate, democratic planning.
An example: Scientists discovered that chlorofluorocarbons were destroying the ozone layer, with extremely dire consequences unless reversed. The market forces approach would have been to tax chlorofluorocarbons, or introduce a chlorofluorocarbon emissions trading scheme. It would then be up to the consumers to reward products with low or no chlorofluorocarbon emissions. It is a near certainty that chlorofluorocarbon’s would continue to be been used, based on fact that carbon dioxide emissions by signatory states to the Kyoto protocol have increased.
The pragmatic alternative was to rapidly phase out chlorofluorocarbons, which is exactly what a couple of hundred countries, including China and the United States, agreed to in 2007. Although the businesses affected claimed the sky would fall, in practice, phasing out chlorofluorocarbons proved to be a doddle, because alternatives had been developed—hydrochlorofluorocarbons—when the pitfalls of using their predecessors became apparent. Although phasing out fossil fuels is not a simple matter of substituting them with non– carbon dioxide emitting alternatives, the same basic strategy is called for: A real world plan involving regulation, taxation and outright bans on the likes of lignite—not emissions trading schemes that suppose market forces will magically evolve a low-emission landscape.
A good start for Aotearoa would be to devise a number of quantified low-emission energy scenarios for comparison—merely adding a little biofuel, solar and wind power whilst chanting the ‘every little bit helps’ mantra is dangerously delusional. Only by doing the math will Aotearoa be able to rationally determine what combination of fit-for-service technologies will cut greenhouse gas emissions within a useful timeframe.
Endorsed by Bill Gates, Sustainable Energy – Without the Hot Air demonstrates the degree of rigour required:
If someone wants an overall view of how energy gets used, where it comes from, and the challenges in switching to new sources, this is the book to read. … I was thrilled to see a book that is scientific, numeric, broad, open-minded, and well written on a topic where a lot of narrow, obscure, non-numeric writing confuses the public. People need to really understand what is going on and then be part of the process of moving the world to a new energy infrastructure.
Physicist David J C MacKay’s book has broken a lot of Green bleeding-hearts, by exposing how lots of ‘little bits’ add up to nowhere near enough to avert catastrophic global warming. In particular, the nuclear power –free scenarios for the United Kingdom come only at a high cost to the British landscape. And while it is entirely possible that nuclear power –free scenarios can be devised for Aotearoa, it is probable that they would eat into food production, and the quantity available for export to an increasingly famished world—not to mention the need for emission-free, nuclear-powered shipping.
Since writing Sustainable Energy – Without the Hot Air, Professor MacKay has been appointed chief scientific advisor to the Department of Energy and Climate Change, and his impact there is graphically evident in the richly interactive 2050 Pathways Calculator on its website. It behoves the government of Aotearoa to emulate this example, and make it harder for politicians, whether advocating for or against climate action, to rely on rhetoric, and for any party, including Green, to advance energy policies that fail to stack-up.
Meantime, Google is in the business of picking winners. To celebrate its 10th birthday, Google put up US$10 million and called for…
ideas to change the world by helping as many people as possible.
Sifting through the ensuing tsunami of 154 000 suggestions took a year and involved 3000 Google staff members. The Shweeb human-powered monorail, developed in Aotearoa by an Australian, was the only civil engineering concept funded—the other four winners were education or transparency in government projects. Although the Rotorua implementation of Shweeb is in the form of an entertainment, the US$1 million awarded will fund research and development to test the technology for urban transport.
Public transport works best where it enjoys a natural monopoly. For this reason, it would be recklessly un-strategic for the second Waitematā Harbour crossing to be for other than public transport.
The most prominent potential route for Shweeb in Aotearoa is as the second harbour crossing. Riders would be rewarded by accessing the swiftest, healthiest and greenest means to cross the Waitematā. The structure itself, being a lightweight suspension span, would potently evoke the spirit of the City of Sails; no other transport system devised could more convincingly advertise its ‘100% pure’ advantage.
Theoretically, a second harbour crossing could evolve spontaneously courtesy of market forces—colossal Vinci Construction could simply build it and collect the toll. But the flaw is that only by ensuring the maximum patronage by car users, preferably one person per car, could the company maximise its profit. The free market lacks any plausible mechanism for evolving a holistic solution that moves people with the least output of greenhouse gas emissions; much less mitigate travel by taking work to the people, not people to the work. Free market propagandists willfully misunderstand that evolution is no substitute for intelligent design, democratically practiced and applied.
The job of the government isn’t to pander to road-building and road transport vested interests. By its own slogan, its transport agency’s business is:
Building a better transport system for New Zealanders.
The government should waste no more time, and start picking transport winners.