Gas and Government: What the Frack?

My existentially-challenged progressive pals Michael Shellenberger and Ted Nordhaus show up in the Washington Post today with an op-ed article that notes the extensive federal government role in developing the hydraulic fracturing technology and some of the related technologies, such as 3-D seismic mapping and directional drilling technology, that have made possible the current natural gas revolution.

Many often point to the shale gas revolution as evidence that the private sector, in response to market forces, is better than government bureaucrats at picking technological winners. It’s a compelling story, one that pits inventive entrepreneurs against slow-moving technocrats and self-dealing politicians.

The problem is, it isn’t true.

I’ll be interested to see whether any of my purist libertarian peeps who have been bashing me as a “technocrat” (definitely meant as a pejorative—you know who you are out there) for expressing some limited support for basic technology research by the government will grapple with this article.  I have a running argument with Michael and Ted on our frequent phone calls and bottomless cups of Cosi coffee and pastries when they come to town over the intermediate stage of the government-to-market process that has brought us consumer use of GPS, touch-screens for our smart phones, high-efficiency jet turbines, and so forth (most of these from military R & D, of course).  The real technophiles talk about the need for government subsidy to get a new technology over the “valley of death” between basic tech development and commercialization at scale and competitive cost.  Too often, I fear, this becomes a playground for rent-seeking and corrupt favoritism (see: Solyndra) or lock-in to an inferior technology (see: corn ethanol) that we can’t get rid of for political reasons (see: Iowa caucuses and corn ethanol).  I repair to the guideline I’ve mentioned here a couple of times before: research, yes; subsidy, no.

I’ll add two points.  First, if we were serious about the principle of “no government technology research,” then we’d move immediately to cut most public universities in half.  Fine with me, if you cut the humanities.  But the real money is in the research sciences. Second, a witness: “There is little reason why the government should not also play some role, or even take the initiative, in such as areas as social insurance and education, and temporarily subsidize certain experimental developments.”  (Emphasis added.)  What squishball said this?  F.A. Hayek, in chapter 17 of The Constitution of Liberty.  I think with all but a few extreme libertoids, Hayek’s libertarian credentials haven’t been revoked yet.

To be sure, we know a lot about many of DARPA’s famous breakthroughs for the Pentagon, and don’t hear about their failures or boondoggles because they are classified.  (I did hear once that back in the 1960s, before the cruise missile came along, DARPA studied the Frisbee, wondering if it could be adapted into a long-range bomb that could be released far from target and thus lowering the risk to bomber pilots.  I’m guessing it failed because they couldn’t mechanically replicate the wrist action that takes slackers years of beer-fueled practice to master.)  But there is one aspect of DARPA and ARPA-E (the Energy Department’s version of DARPA) that is worth conjuring with. DARPA changes out its leadership every three years to ensure fresh blood and new thinking; their hiring is exempt from civil service rules that clog up the rest of government, and they research projects are exempt from Davis-Bacon union requirements.  So why don’t we extend this to more of government?

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