October 13, 2010

Of M's and B's. The Principle is the Same.

Build ’Em and They’ll Come
Published: October 12, 2010

Kishore Mahbubani, the dean of the Lee Kuan Yew School of Public Policy at the National University of Singapore,

Yes, yes. You have important friends. We’re all suitably impressed by your social capital.

 is over for tea

This is going to come back around on us at some point.

and I am telling him

Read: boring him to death.

about what I consider to be the most exciting, moon-shot-quality, high-aspiration initiative proposed by President Obama that no one has heard of. It’s a plan to set up eight innovation hubs to solve the eight biggest energy problems in the world. But I explain that the program has not been fully funded yet because Congress, concerned about every dime we spend these days,

You’re kidding right? He’s kidding. He has to be.

is reluctant to appropriate the full $25 million for each center, let alone for all eight at once, so only three are moving ahead. But Kishore interrupts me midsentence.
“You mean billion,” he asks? “No,” I say. “We’re talking about $25 million.” “Billion,” he repeats. “No. Million,” I insist.
The Singaporean is aghast.
The horror! A foreigner disapproves!
He simply can’t believe that at a time when his little city-state has invested more than a billion dollars to make Singapore a biomedical science hub and attract the world’s best talent, America is debating about spending mere millions on game-changing energy research.
Just so that Thomas Friedman knows, in America, we do much of our private sector funding in the private sector.
Welcome to Tea Party America. Think small and carry a big ego.
This may seem like a little issue, but it is not.
Really? A lack of funding for eight quasi-effectual anti-global warming stations to serve as anti-productive  communes for public sector elite is a big issue?
 Nations thrive or languish usually not because of one big bad decision, but because of thousands of small bad ones
Maybe the Roman Empire or the British Empire. Fortunately, we live in America, a country specifically designed to neither thrive nor languish based on governmental overreach, but on the success of individual actors in the marketplace.
 — decisions where priorities get lost
I have my priorities in hand, thank you. This sounds like a terrible idea and I’m only getting a one-sided approach from a supporter.
 and resources misallocated
If only a mechanism existed that corrected misallocated resources... Is it Congress? Surely Adam Smith meant Congress when he described the “invisible hand.”
 so that the nation’s full potential can’t be nurtured and it ends up being less than the sum of its parts.
This is pure nonsense. We need government intervention to make our economy efficient?
 That is my worry for America.
We’ll be fine, big guy. Now stop undercutting the force that is going to usher back the forces to maintain the market efficiency you claim to want.
But none of this is inevitable.
Have you seen the polling data?
So let’s start with the good news: a shout-out for Obama’s energy, science and technology team for thinking big.
Wasn’t the whole point that $25M x 8 =$200M is not big?
 Soon after taking office, they proposed what Energy Secretary Steven Chu calls “a series of mini-Manhattan projects.” In the fiscal year 2010 budget, the Department of Energy requested financing for “Energy Innovation Hubs” in eight areas: smart grid, solar electricity, carbon capture and storage, extreme materials, batteries and energy storage, energy efficient buildings, nuclear energy, and fuels from sunlight.
All of this is predicated on a bad idea that one side of the aisle dreamed up to destroy private innovation, which, not coincidentally, is what can actually stop real pollution (which CO2 is not.)
In each area, universities, national labs and private industry were invited to put together teams of their best scientists and research ideas to win $25 million a year for five years, to, as Chu put it, “accelerate the normal progress of science and technology for energy research”
Read: supplant the beleaguered free market.
 and thereby “discover and commercialize the energy breakthroughs we need” and thereby spawn new jobs and industries.
The new jobs and industries don’t come from government poking and prodding. They come from enterprising risk-takers with a great idea and a dream. Not to mention that this all sounds well and good, until you realize that it will supplant existing jobs and existing industries. Which is fine. Innovation and cannibalism are unavoidable and necessary functions of the economy. It should be horrifying, however, that the old-line energy companies are forced to pay taxes that the government is using to destroy them. It’s downright evil.
So far Congress has appropriated partial funding — “up to $22 million” but probably less — for three of these hubs for one year. So Penn State and two national labs will develop energy efficient building designs.
I’m very reassured that the buildings will have a low carbon footprint.
Oak Ridge National Laboratory will lead a team to model new nuclear reactors,
This might be a relevant use of money if we would actually allow building of new nuclear power plants using existing technology. There are no market applications for nuclear power thanks to the Congress. Period.
 and the California Institute of Technology and the Lawrence Berkeley National Laboratory will work on revolutionary ways to generate fuels from sunlight.
We’ve been working on solar panels for DECADES! Within my lifetime, they will never produce enough electricity to supplant traditional technology. Funding this research through the taxpayers is throwing good money after bad.
Chu is now trying to persuade Congress to finance those three again for 2011, as well as at least one more: batteries.
Because laptop manufacturers, car manufacturers, and about thirty other industries don’t have enough incentive to improve their own product…
In my view, Congress should be funding all eight right now for five years — $1 billion
Added up pretty quick, huh? That’s with a B, right?
 — so that we not only get graduate students, knowing the research money is there, flocking to these new energy fields but we get the benefit of all these scientists collaborating and cross-fertilizing.
They’re scientists, not lima beans.
Chu, who holds a Nobel Prize in physics, says he understands and respects that Congress has to make tough budgeting choices today, so I cannot get him to utter one word of criticism about our lawmakers’ spending priorities.
Props.
 But he waxes eloquent about what it would mean for American innovation if we could actually fully pay for this focused moon shot on energy.
We can. In private industry, which invests in probably technology, not moon shots, which are, by definition, improbable. Is that supposed to be a selling point?
The idea behind the hubs, explained Chu, is to “capture the same spirit” that produced radar and the first nuclear bomb.
Fear of massive government intervention taking over America? Wait…
 That is, “get Nobel Prize winners in physics working side by side with engineers” — not to produce an academic paper but “to solve a problem in a way that will actually be deployed” and do it much faster than the traditional academic model of everyone working in their own silo.
So reform public Universities. Stop asking for more money!
“We don’t want incremental improvements,”
I do.
 said Chu. “We want real leaps — game-changing” breakthroughs
That’s great, but unrealistic.
— like a 75 percent reduction in energy used in a commercial building through affordable design and software improvements.
Yawn.
“America has shown we can do this,” concluded Chu. “The scientists and engineers see the problem; they see the opportunity; they see what is at stake,
Literally, nothing is at stake except a governmental cash cow.
 and they want to help.” That is why we should fully fund all eight now.
All of this reminds me of my favorite business quote from a consultant who had worked for the German technology giant, Siemens. He said: “If Siemens only knew what Siemens knows, it would be a rich company.”
...Siemens is a rich company. Not to mention that that quote was about cross-function information availability, which unquestionably exists in the academic sphere. That’s why every associate professor is bounding over the carcasses of their peers to publish.
Ditto America.
Not quite the same. We have natural and productive divergent participants. Unlike a single company.
 We still have all the right stuff. The president’s instinct to push out the boundaries of energy science is spot on, but Congress has to think big, too, and help unlock and scale everything that America knows. Please, please: Stop lavishing money on repaving old roads and pinching pennies when it comes to pioneering new frontiers.
Deal. We’ll pinch pennies everywhere, a private company will invent a hover-car, and the promise-turned-oath of science fiction will make everyone happy.
Oh and P.S., go to hell, Thomas Friedman. Not five years ago, you were still touting the limitless potential of unfettered global capitalism. Now you want the government intervening on something this trifling? If you weren’t a myopic fraud then, you certainly are now.

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