Douglas Purdy

http://www.theatlantic.com/doc/201001/american-decline

I am repeatedly impressed with the writing in the Atlantic.  So much so, that it joins the Economist as the only two periodicals to grace my Kindle.

James Fallows recent article with the same title as this post is a compelling read.  Although the reasons may not be what you expect.

The first reason is summarized best in a John Adams quote found in the article.

Remember, democracy never lasts long. It soon wastes, exhausts, and murders itself. There never was a democracy yet that did not commit suicide.

It is worthwhile to consider the track record of democracy as long-term governing mechanism.  If you decide to undertake that, decoupling individual “freedom/liberty” from “democracy” during the process could provide new insights.

The second reason is the policy point around the importance of the public sector as “capital collector and director” (my words).

Robert Atkinson, the director of the Information Technology and Innovation Foundation, in Washington, has written that several times per century, a “transformational wave” of new technologies ripples through the economy and creates new opportunities and wealth. In the past, these have included mass-production systems, modern chemicals, aviation, and so on. Today the economically important technologies include genomic knowledge, information technologies like the Internet, and the geospatial information, from the GPS network, that is built into everything from dashboard navigators to the climate-change-monitoring systems that measure the size of glaciers or extent of forests. Private companies now create the jobs and wealth in each field, but public funds paid for the original scientific breakthroughs and provided early markets.

It couldn’t have been otherwise, Atkinson says. The scale of investment was too vast. The uncertainty of payoff was too great. The risk that profits and benefits would go to competitors who hadn’t made the initial investment was too high. The difference between promising and dead-end technologies was too hard to predict—especially decades ago, when work in all these fields began. So each started as a public program: the Internet by the Pentagon, the Human Genome Project by the National Institutes of Health, and the GPS network by the Air Force, which still operates it. The government could not have created Google, but Google could not have existed without government efforts to establish the Internet long before the company’s founders were born. This pattern—public investment and standard-setting, followed by private industrial growth—has been consistent through the years, Atkinson said, which is what worries him now. “Our companies and entrepreneurs are matchless in their power to adapt,” he said. “We lead in many categories the private economy can handle by itself. But where you need any public-private coordination, we’ve become handicapped. I worry that our companies can adapt, but our system can’t.”