I started this debate by pointing to the separation of church and state as a useful analogy for understanding why government should have no role in funding scientific research, and I want to return to that analogy now. In the eighteenth century, many people, including Patrick Henry, believed that without government subsidies to churches, religion would collapse and with it the moral foundations of society. Disestablishmentarians like Jefferson and Madison disagreed, arguing that such subsidies were immoral, impractical, and unnecessary.
They turned out to be right. Separating religion and state did not destroy religion—on the contrary, it probably made religion stronger in the United States, while at the same time temporizing the extremism of churches and making them more responsive to the actual needs of people and less an instrument of oppression in the hands of clerical elites. It liberated nonconformists to produce innovative new ideas, some of which were adopted by churches later, and it meant that churches would have to succeed by convincing people that they were worthy of support, rather than coercing them to support churches against their will. I believe interconnection between science and the state creates very similar problems—and that separating them would have the same benefits—as in the case of church and state. So far, Mike Dunford has offered few serious arguments against my position and has not shown why the same arguments for separating church and state do not also apply to separating science and state.
1) Forcing people to subsidize science is immoral
It is wrong to take away a person’s earnings for your own benefit. In political society, we have agreed (tacitly) to accept taxation for certain limited purposes, but I have argued that there is no Constitutional authority for Congress to subsidize general scientific research (a point to which Dunford has not responded). And when a person’s earnings are taken away for reasons outside of that agreement, then we return to the original proposition: it is wrong to take away the money a person has worked for and to use it for your own projects, no matter how noble you might think them. Antidisestablishmentarians believed that it was morally right to take people’s money away to subsidize churches, but as Jefferson wrote,
to compel a man to furnish contributions of money for the propagation of opinions which he disbelieves, is sinful and tyrannical; that even the forcing him to support this or that teacher of his own religious persuasion, is depriving him of the comfortable liberty of giving his contributions to the particular pastor whose morals he would make his pattern, and whose powers he feels most persuasive to righteousness….
Using the government to enrich yourself at someone else’s expense is no less a robbery just because it is done under the forms of law. If I take away your paycheck and use it to pay my sick grandmother’s hospital bills, it does not mean that I have committed anything other than theft. Dunford has not responded to this point.
2) Economic incentives ensure that government subsidies to science are economically wasteful
A thing is an economic benefit only if it pays off to the investor more than he paid into it. But, of course, “pays off” is a highly personal concept. As Nobel laureate James Buchanan puts it, “voluntary exchanges among persons, within a competitive constraints structure, generate efficient resource usage, which is determined only as the exchanges are made.” In other words, what I consider a “payoff” is not the same thing that you would consider a “payoff.” I used the example of Brewster’s Millions: Brewster regards high cash returns as a downside to the “investments” he makes because his desire is to get rid of money, not to make more. And that is because the only way of assessing whether something is or is not an economic benefit is by knowing all of a person’s needs and expendable resources—something no person other than the actor himself can do. As a result, any coercive transaction is by definition economically inefficient. After all, if it were efficient—if the transaction would result in a payoff to me—I would not have to be coerced. (More: the coercion itself also imposes sentimental costs on me that make the transaction even less efficient.)
It is therefore improper to use the term “investment” when talking about government subsidies. They are not investments because they are not based on individual cost-benefit analyses. They are based on collective political considerations instead, and are therefore by definition not wise investments.
(Many economists assume that “an increase in social wealth” is a goal that everyone pursues, so that coercive transactions might be classified as “investments.” This is simply incorrect in anything but the most trivial sense. An ascetic monk does not desire an increase in social wealth. If we define “wealth” as “utility,” then of course it’s true that he, like all other economic actors, desires an increase in utility—but of course, his utility is the opposite of wealth, so that argument begs the question.)
A related point is this: we cannot determine whether or not a government-subsidized project was a “good idea” without considering the unseen costs of that transaction: the broken window fallacy that Dunford makes time and time again. Yes, DARPA created the Arpanet, and, eventually, private enterprise made such technology into the Internet we know and love. Does that prove that government funding of Arpanet’s creation was a good idea? Not unless we can see what people might have done with their tax dollars if they had been allowed to keep them. If people had been allowed to keep that money, they would have used it to buy things they wanted—including scientific research. Instead, they were forced to buy something they did not want. We cannot now say “Look what they got with their money” and count them as ultimate winners, any more than we could steal their money, buy them Cadillacs, and then count them winners because they got Cadillacs. We don’t know what they would have done with that money, but we do know one thing—they almost certainly would not have spent it on Cadillacs! So they are not winners in the long-run. The same was true in the 18th century: you cannot take money from the hands of Baptists and give it to Anglicans and then tell the Baptists they are ultimately winners since, after all, they got a strong Anglican clergy out of the deal. They didn’t want a strong Anglican clergy, or they would have paid for it voluntarily.
To use examples of successes with government-funded research is therefore not a legitimate argument that these subsidies are good for people. Sure, there have been benefits from such research. But they were benefits people did not choose to buy, and those people cannot therefore be counted as winners.
What this means is that government is inherently incapable of economically efficient resource use. It is “necessarily worse” than free decision-making by private actors.
3) Political incentives (i.e., rent seeking) ensure that government subsidies to science will primarily benefit politically connected elites
Mike Dunford does not appear to understand what the term “rent seeking” means. He has twice used words to the effect that he wants me to “show that private industry is better at avoiding rent-seeking behavior than government.” The first time, I ignored it because I thought perhaps he had misspoken. In fact, “rent seeking” occurs when private groups—largely private industries—invest time and money in obtaining differential advantages from the government. To speak of a difference between rent seeking by private industries and rent seeking by government agencies can be meaningful in some contexts, but not in this context. The rent-seeking problem with government subsidies is that economic actors, usually private industry actors, try to get the government to subsidize them regardless of their merit or whether they “deserve” the subsidy in some abstract sense. Rent seeking is economically inefficient for several reasons. One reason is that the actors spend time and money on lobbying the government or monitoring rivals, which is not economically productive behavior. Another is that it allocates resources not based on productive potential but based on political considerations—which strikes me as basically the definition of corruption.
But were government and science separated by a wall, as I am advocating, there would be no such rent seeking behavior because government would not have the power to allocate the relevant resources. This was the thesis advanced in chapter 19 of James Buchanan and Gordon Tullock’s famous book The Calculus of Consent:
Conjecturally, and certainly not without considerable historical validity, we may imagine a government that undertakes only those activities which provide general benefits to all individuals and groups and which are financed from general tax revenues. Under these conditions, there would be relatively little incentive for particular groups of individuals to organize themselves into associations designed specifically to secure special advantages through governmental action.
Again, let’s think about church and state. Without a separation of church and state, which religion gets the subsidy? Well, the one that has the most persuasive lobbyists—the church the mayor belongs to—the church that most vocally attacks an unpopular minority—the religion that bends the ear of the political official. In attacking the union of church and state, Jefferson said that even forcing a person to subsidize his own church “is withdrawing from the ministry those temporal rewards, which proceeding from an approbation of their personal conduct, are an additional incitement to earnest and unremitting labors for the instruction of mankind.” In other words, it makes the preacher’s reward depend on political favor instead of merit.
What are the practical implications of a union of government and science? President Eisenhower explained them famously in his farewell address, when he warned that “[t]he prospect of domination of the nation’s scholars by Federal employment, project allocations, and the power of money is ever present—and is gravely to be regarded. Yet, in holding scientific research and discovery in respect, as we should, we must also be alert to the equal and opposite danger that public policy could itself become the captive of a scientific-technological elite.” When government controls the resources, economic decisions are made on the basis of political advantage, not on the basis of what consumers actually want. That’s why the big banks are getting bailouts now, and the car-makers. They don’t deserve it: they just have a lot of political influence.
But science is supposed to be about the merits only, not political influence.
Dunford’s question, therefore, makes no sense in the context of this discussion. The problem with government financing is precisely that it creates an incentive for private industry (as well as government-operated industries like universities) to use the government to allocate resources to their own benefit. The question is not, as Dunford thinks, whether or not private industry engages in rent-seeking. Certainly it does—that’s just the problem I am urging us to resolve! Rent-seeking behavior is inevitable when government hands out differential advantages. But economic rewards ought to come through one actor convincing another actor to voluntarily exchange—not through manipulating the political process to obtain economic favors. When the latter happens, the result is inevitably the creation of an elite shielded from—and often hostile to, real innovation. Case in point: Isaac Newton’s presidency of the Royal Society. Another case in point: the scientific establishment of the U.S.S.R. In both of these cases, the union of government and science created a scientific “priesthood” as it were, which stifled scientific innovation, and focused largely on its own political success with favored constituencies rather than scientific achievements. The closer the connection between science and government, the worse this situation has been. The only way to eliminate rent-seeking behavior by private industry or anyone else is to eliminate the mechanism of wealth-transfers.
4) Allowing government to wrap itself in scientific credentials gives it a dangerous and unwarranted claim to legitimacy
Another objection that Jefferson and Madison raised to the union of religion and government was that allowing government to portray itself as the instrument of God gave it unwarranted authority, and cover for its nasty projects. As Madison put it in his famous Memorial and Remonstrance,
What influence in fact have ecclesiastical establishments had on Civil Society? In some instances they have been seen to erect a spiritual tyranny on the ruins of the Civil authority; in many instances they have been seen upholding the thrones of political tyranny: in no instance have they been seen the guardians of the liberties of the people. Rulers who wished to subvert the public liberty, may have found an established Clergy convenient auxiliaries.
A similar thing can be said, unfortunately, of the union of science and the state—as Chris Mooney has recently argued. Government is not in the business of discovering the truth. It is in the business of maintaining power (for good or for bad ends). When it can claim to be acting scientifically, it will abuse that power—and scientists ought to be wary of that threat. Government has abused its pretenses to scientific respectability often in the past. Dunford has not responded to this point.
5) Private decision makers are better at making choices about using resources than the government
To sum up the economic arguments, private actors are better at making choices about what they want to do with their money than is the government. Political leaders and administrative officials respond to a whole different set of incentives than do private economic actors. There is no question that private industry can be corrupt and do nasty things and make dumb investments. The question is, what reason do we have to think that government will be any better? When Enron ripped people off spectacularly, it went out of business and people went to jail. When FEMA failed spectacularly after Hurricane Katrina, what happened? FEMA got reorganized a bit, and then got a budget increase. As I’ve said before, you can’t sue the government. You can’t refuse to pay it. You can’t shop somewhere else, or fire its employees, or even get them on the phone most of the time. You have no legal right to many of its services—why in the world would you think that it will do a better job of serving your needs? To again quote Jefferson, “Sometimes it is said that man can not be trusted with the government of himself. Can he, then, be trusted with the government of others? Or have we found angels in the forms of kings [or administrative agencies] to govern him?”
Dunford argues that the example of tobacco shows that private industry will act nefariously. No doubt it will. But, again, private decision-makers have also mounted powerfully successful anti-smoking campaigns, and publicized research about the dangers of smoking. It was a private decision-maker, Jeffrey Wigand, not a government agency, that blew the whistle on Brown & Williamson. Tobacco companies have been made to pay through the nose (so to speak) for their responsibility in selling cigarettes, because private companies are subject to tort law. But when the U.S. government exposes people to cancer-causing substances, as in the case of George Barnes, it does not have to pay. And in many countries, government has not only sold cigarettes for decades, but enjoyed a monopoly on the sale of cigarettes!
Which would you rather trust: private industries that can be punished for wrongdoing, or government, which can monopolize the practice of wrongdoing...and escape all liability?
Also, Dunford says that “tobacco companies simply could not be trusted to conduct or encourage honest research into the effects of their products.” That is absolutely true. Nobody should be the judge in his own case. One of the great things about the free market is that there is a demand for honest research and monitoring of product safety—a demand that can be served by a private company. There are all sorts of private organizations that conduct that kind of business—everything from the AMA to title insurance companies to the Good Housekeeping Seal of Approval to Consumer Reports magazine to the old “Fight Back!” with David Horowitz. There is no question that private alternatives exist to provide this service. When Dunford asks whether “private industry is better at avoiding...interference in science,” he is asking the wrong question. The question is, what institutions exist to counteract this deleterious and inevitable temptation? The answer is clear in the case of private actors choosing freely: that is, competition by more honest firms. With government, there is no such mechanism and no realistic alternative.
This question of trusting government or trusting private economic actors is an important one. Dunford rejects my point that one trusts one’s life to private market actors all the time, and that we are the better for it, because, as he writes, “In each and every one of those cases, we take a ‘trust, but verify’ approach to the market’s ability to protect us. We have set safety standards, and we require products to meet those.” But tort law—which I’ve never argued against—already does that. I certainly do not deny that “in the short run, fraud often pays very, very well,” nor am I advocating the elimination of all government or the legalization of fraud. What I am arguing is that there is no reason to think that government is systematically more trustworthy than private actors in ensuring the integrity of scientific research. Quite the opposite, given the incentives. While you can and should“trust but verify”—and sue—private industries, you have no power to do that with regard to government.
Government kills and imprisons people with impunity. It takes their homes away, deprives them of their livelihood, and lies to them. It controls their education, it sends them to war in distant lands, and tries to tell them how to pray. And it often dictates to scientists what they can and cannot say, and what they can and cannot do. Yet none of us can verify, none of us can sue, none of us can choose any alternative. Of the two, private industry is more trustworthy precisely because it can be held to account—which the government cannot.
Let us again return to the church and state analogy. An antidisestablishmentarian like Dunford could insist that goverment and church should not be separated because privately funded churches cannot be trusted to act wisely and justly. But as Madison said, government subsidies for religion
impl[y]...that the Civil Magistrate is a competent Judge of Religious Truth...an arrogant pretension falsified by the contradictory opinions of Rulers in all ages, and throughout the world.... [Government subsidies are] not requisite for the support of the Christian Religion...for it is known that this Religion both existed and flourished, not only without the support of human laws, but in spite of every opposition from them.... [A] Religion not invented by human policy, must have pre-existed and been supported, before it was established by human policy. It is moreover to weaken...a pious confidence in [Christianity's] innate excellence...and to foster in those who still reject it, a suspicion that its friends are too conscious of its fallacies to trust it to its own merits.
The same is true of government subsidies for science. The best security against nefarious private actors is (1) a rigorously enforced tort law protecting individuals against force and fraud, and (2) free competition. It is precisely when government becomes cozy with private groups, be they churches, private industry, or scientific organizations, that the dangers arise of short-sightedness, rent-seeking, and corruption.
6) Private individuals and groups have proven their ability to support good long-term scientific research
It’s on this point—whether government subsidies are necessary—that Dunford has spent most of his time, arguing in particular that the Internet provides a good example of government doing basic research that private industry is incapable of doing. I’ve explained that there are a couple weaknesses with this argument: first, because we can’t know what private decisionmakers would have done with their money if they had not been forced to subsidize Arpanet research, and we cannot therefore commit the Broken Window Fallacy of pointing to Arpanet as though it is proof of government success; second, that government’s contribution to the modern Internet is minuscule compared to what private industry has done with it; third, that even if the Internet were an example of government success, we’d have to weigh it against the many failures of government research in order to have an overall picture.
Interestingly, Dunford throws in a new argument this time: he acknowledges that private institutions like CompuServe and America Online ran their own data networks, but says that they were “ultimately crippled by one of the free-market side-effects: they weren't very inter-compatible,” and contends that there is no financial incentive to create interconnective technology. But of course there is such an incentive: where there is a demand, there is an incentive. Interconnectivity of technology is utility, and there is a demand for it. Does a free market have institutions for creating product standardization? Why, yes: the American National Standards Institute is a privately run, privately funded institution for the standardization of a wide variety of technologies. And, as an economist for the government-run National Institute for Standardized Techologies admits, “Standardization can and does occur without formal promulgation as a ‘standard.’”
Of course, how standardization takes place in a free market will depend on various factors. There are downsides to enforced standardization, and there is no institution better suited to weighing the pluses and minuses of standardization than individuals choosing for themselves in freedom. As Vanberg puts it in technical parlance, “determining the pareto-relevance of network externalities presupposes that the cost and benefit schedules are known. Because such knowledge is generally not available to policy makers, there is always a great risk of false positives (and false negatives) in these policy decisions.” In other words, government is not capable of knowing when consumers benefit from standardization and when they do not.
By the way, one of the major obstacles to standardization in today's economy is our friend the government: antitrust law makes many moves toward standardization potentially illegal—with treble damages hanging over the head of any company that introduces a technology that is too interconnected and therefore represents an attempt to monopolize. (Of course, technology that isn’t compatible enough with other technology also violates the antitrust laws, and nobody knows what those laws will mean until the verdict comes in.) When Microsoft moved toward standardization by giving away Microsoft Explorer—they got haled into court for excluding rivals.
7) We are not children who need government to decide for us.
In the end, Mike Dunford has offered us an exceedingly weak argument for his position. I have raised serious theoretical explanations of the problems with government subsidies, based on solid moral, political, and economic arguments. He has failed to seriously respond to any of them.
He appears to be unfamiliar with the very concept of rent-seeking, which is probably the most important subject one must know when discussing government subsidies. He repeatedly commits notorious economic fallacies like the Broken Window Fallacy or the intrinsic value fallacy. Rather than explain how scientists are immune from public choice effects, or how it is that government bureaucrats can wisely choose those “investments” consumers will want, after having deprived consumers of choice, or why government is more trustworthy than private enterprise even though all the incentives point in the opposite direction—rather than explain these things, Dunford has four arguments: scientific research is a public good; the Internet shows that government research sometimes provides good things; tobacco shows that private industry is nefarious; and adults are analogous to children, who don’t know what is good for them, and whose money should be taken away from them and spent for what we decide is in their best interests.
But we have seen that private industry provides public goods all the time, including peer-reviewed scientific research, that is funded by gigantic private charitable institutions and often given away by private industry. We have seen that Arpanet is an example of the Broken Window—that it was created at the expense of people who might have done something else with their money if they’d been allowed to—and that it was really private industry that made the Internet. We have seen that tobacco, in fact, was and remains deeply intertwined with government, which subsidized tobacco in the U.S. and monopolizes tobacco sales in other countries; that private actors and institutions, from whistleblowers to cancer research institutions, did good work opposing the tobacco industry; and that when government did get involved, it crafted a Master Settlement Agreement that guarantees permanent market share to a cartel of American tobacco companies. We have seen that private industry, in fact, does have institutions that create standards of safety and compatibility, and that government institutions—immune from lawsuit, guaranteed an income regardless of performance, insulated against consumer backlash—are far less trustworthy in these matters than are private industries that can be shut down, boycotted, or prosecuted. We have seen that government involvement leads to rent-seeking and cronyism, and the more involved it is, the worse these things get, so that in the U.S.S.R., where all science was funded by (and therefore necessarily controlled by) government, there was precious little scientific progress.
But, now, what about the children?
I’ve argued that something cannot be an economic value if a person doesn’t choose it—thus scientific research performed at the expense of taxpayers who did not choose it cannot be counted as a “value” for them. All economic value is personal; there is no such thing as intrinsic economic value. Dunford disagreed—things can be of value to people without their choosing them. “I think that it is possible to assess whether or not a particular action has tangible economic effects.” Effects? Yes. Benefit? No. Benefits or values can only be benefits or values to someone—they cannot be benefits per se, or values per se. Life is not a benefit to a person in incurable and terminal agony. Money is not a benefit to an ascetic monk.
Nevertheless, Dunford pushes for an answer to his child analogy. Isn’t it true that people can benefit from things they’re forced to do—like children who are forced to go to school for their own good? I chose earlier not to respond to this point because it is deeply misleading to try to analogize children, who cannot choose for themselves, and adult taxpayers who can and are not allowed to. But he objects that I am merely “[making] some noises about potential non-beneficial effects of education in general, [while] ignor[ing] all the points I raised about the benefits of requiring the education of children.”
I think my point is clear: education, like everything else, can be of value only if it is valued by someone. Neither education, nor anything else, is intrinsically or necessarily of value to everyone. There are people, including children, for whom education is not a value—who would obtain greater value doing something else. One reason people put a high value on educational choice, and object to No Child Left Behind, is that they want to tailor their education to serve their particular needs and aptitudes. Some people would benefit more from a trade school than a liberal arts school. Forcing every child to study quantum physics is not of value to them—because most of them do not have any need or desire for that education. To return to my earlier analogy, forcing people to buy Cadillacs (or Yugos!) is not wise public policy, because they didn’t want Cadillacs. Forcing people to pay for a Large Hadron Collider is not wise public policy. They did not want a Large Hadron Collider. They wanted a new house or a new car or a vacation or cancer research or AIDS research or global warming research or something instead. But the government decided for their alleged good to give them a Large Hadron Collider.
Many people claim to know what is good for the population, the citizens, the people, but the welfare of a population is maximized only when free people make free decisions without coercion from anyone.... Scientists are...no more qualified than any other person to dictate to everyone what those goals should be. Decisions and opinions are not the realm of science but, rather, the realm of human choice. Humanity is always better off when basketball decisions are left to basketball players and market decisions to the market players, that is, you and me.
Dunford’s implication that adult taxpayers are basically like children who don’t know what’s good for them, and who must therefore be forced to buy things the government considers to be in their benefit, is very telling.
There are a variety of problems with that attitude. 1) Private interest groups will scramble to claim that their service is also a benefit people should be forced to buy (rent-seeking); 2) Government is incapable of assembling the necessary information to determine what really is and is not a benefit to them; 3) It creates a massive incentive for government corruption (or as Dunford might call it, “mistakes”) which cannot be punished by boycotts or lawsuits; 4) Given the personal nature of economic value, such a project is inherently inefficient; 5) Those who sell the thing are bound to be hampered or corrupted by government interference; 6) It gives a dangerous power to the government; 7) It is morally offensive and violates the rights of individuals. Back in the days before the separation of church and state, it was widely believed that people were basically like children, and that the government should force them to subsidize churches for their own good. And sure enough, all these problems came along with those subsidies.
I don’t believe government should regard people as children who must be coerced to do things that George W. Bush or Nancy Pelosi think are “better” for them. On the contrary, I believe that grown adults are born free and have the right to choose for themselves whether or not they want to fund science research. True, many people will make what I consider short-sighted or foolish choices in that regard. But I have no right—and no skill—in making choices for other people. And to try sets a very dangerous precedent.
Virtually all of the objections that Mike Dunford has raised to separating science and state have their echoes in the debate over the separation of church and state. It was a radical proposal in its time; many antidisestablishmentarians thought it would lead to the destruction of religion, that people would make unwise choices, that they should be forced to subsidize religion because they were basically childlike and needed government to make their choices for them. But the separation came, and the results were on net positive. No, it didn’t lead to a perfect world—there is still corruption in churches, and government still tries to get away with benefiting religion, and people certainly didn’t become morally pure. Yet I don’t think anyone can doubt that the separation was good for government, good for religion, and good for those of us who would prefer not to be treated like children, and who would prefer to spend our money on other things.
The same is true of science and state. They ought to be separated now and forever.
One final note: I want to thank Mike Dunford for two things; first, for suggesting and following through with this debate, and second, for giving me the opportunity to genuinely and repeatedly use the word antidisestablishmentarian in a blog post.