President Obama talked a Reaganesque line in his State of the Union speech about business and innovation. Here's his paean to business.
Our free enterprise system is what drives innovation. But because it’s not always profitable for companies to invest in basic research, throughout our history, our government has provided cutting-edge scientists and inventors with the support that they need. That’s what planted the seeds for the Internet. That’s what helped make possible things like computer chips and GPS. Just think of all the good jobs -- from manufacturing to retail -- that have come from these breakthroughs.
Notice the "but". But government needs to step in to fund basic research, to plant the seeds of the internet.
Here's where our liberal friends smuggle their statism in the back door.
The internet, Mr. President, was invented through DARPA research because the Pentagon thought that the government needed a communications network that could survive interruption in nuclear war. In other words, the government invented the internet for reasons of defense. The government paid for semiconductor research because it needed lightweight electronics for ballistic missile guidance. In other words, the government was looking after its own needs, and its core responsibility of defense.
But this is an imperfect world. Politicians and experts aren't satisfied by the mundane tasks of defense. They want to save the world. That's how we get from defense research to climate-change research. But saving the world is not a government task. Saving the world is a religious task. It's the job of people with a moral mission, not a defense mission. Moral missions, of course, are much more fun. You can divide the world into the good guys and the bad guys, and you can lead a moral crusade against the bad guys. But never mind about that. Government doesn't just want to lead people on moral crusades; it wants to feed every child and put two cars in every garage.
The big problem, in other words, is mission creep. And when government gets into mission creep in the economic sector it starts building technological and economic white elephants. Mission creep leads to waste and corruption and to crony capitalism. Government doesn't make people more prosperous. It just gives money to its supporters, and stiffs the rest.
This really isn't hard. Government should stick to its basic functions and people in political life should stick to the dull and dutiful job of defending society from enemies that want to kill us or defraud us. The fun job of saving the world should be left to moral leaders. And the hands-on job of innovation and making new products should be left to businessmen, scientists, engineers, marketers, designers, salespeople, and investors.
When government tries to get into the business of innovation and basic research not related to its core functions, it makes a mess. That's because government is force, politics is power. Business is different. Business is about imagining and then creating products and services. Business is about listening to consumers and responding to their every whim. Leave business to business, and concentrate on applying force on them when they do something criminal. Otherwise, leave them alone, and above all, don't tempt them into crony capitalism.