A small proposal to rethink big government

If you haven’t heard potential future presidential candidate Pete Buttigieg go straight into the lion’s den to debate his critics on the Flagrant podcast, start watching. Among the many engaging exchanges was one about government research.

I largely agree with @PeteButtigieg's take (similar to @hasanthehun and @BernieSanders) on principle, except the idea that only the government can invest in long-term return ideas. In fact:

1. The government doesn’t necessarily have a special long-term view on the initial creation of its large-scale research projects (it is an open question on whether the internet was ever meant for public usage)

2. The government isn’t the only entity that can come up with multi-trillion dollar ideas.

We are experiencing a multi-trillion idea right now - conversational AI. It wasn't developed in a government lab; it was created by private enterprise (@OpenAI). The notion that private enterprise can only be short-term focused is literally short-sighted.

Government should play an important but indirect role. Non-profits and governments aren't effective at driving scalable change because they're not focused on sustainability (i.e. profit). Combined with a near requirement to sacrifice pay & benefits "for the greater good" to hold an American government position, it makes it very difficult to retain the best and brightest.

Here's how the right government should operate:

1. It should provide consistent regulatory frameworks that counter capitalism's tendency towards monopoly and negative outcomes from unrestricted capitalism. With constituency support, it will direct funding and regulatory favorability towards broad causes like stopping global warming or rebuilding American infrastructure.

2. It should raise and direct funds to public goods with challenging business models, but only through the funding and support of non-government enterprises.

3. It should provide an enforcement layer for companies violating regulations and a national defense system. It should have ultimate power and ability to enforce regulations approved by its constituency.

That's it.

Of course, there are important implications:

(A) We need to overhaul our entitlement programs, not to eliminate them but to install private enterprise leads that care about balancing budgets, optimizing efficacy, and driving social change.

(B) We need to increase government power to regulate bad actors. When the Mag7 or big corporates violate regulations, penalties must be strict, substantial, and swift.

(C) We need to rethink or dismantle the government apparatus managing the IRS, NIH, TSA, CBP, DEA, SSA, DOT, Education, and even the USPS among other agencies.

In practice, government entitlement programs and research labs will transition ownership to private enterprise over time, though the government may still provide significant funding. Government programs like IRS and USPS should enforce regulations around free and fast tax filings and mail delivery rather than attempting (poorly) to provide these services directly. Government enforcement agencies can remain but shouldn’t enact independent programs other than those that enforce regulations.

People on both sides will immediately challenge (C) and some will resort to ad hominem arguments and/or out-of-context misreads to counter this position. Some may say these changes are unprecedented and anarchic.

But for every example I've provided, I can point to a developed country that does what I'm advocating for and does it well:

- Privatized transportation: Consider Japan's subway infrastructure or the Public-Private Partnerships shaping many countries' infrastructure development.

- Privatized research: We already operate this way in many respects, and NASA shows how funding private enterprises instead of building directly has led to improved outcomes.

- Privatized healthcare: Switzerland and Norway require private insurance, and their governments heavily regulate it to ensure universal healthcare.

- Privatized education: I attended public schools and want my future kids to go to one. However, American education needs a major overhaul. Public charter schools, funded partly by the government but privately operated, exist in the US and should be more widespread given their performance.

- Privatized taxes: In most countries, employers/banks drive tax calculations because tax authorities pre-fill returns based on this data for user approval instead of requiring the user to fill it out.

- Privatized utilities: Look at the UK and France for examples of a largely privatized utility infrastructure that works and is efficient. Large-scale energy markets establish consistent pricing across markets.

- Privatized logistics: Look at Germany and the UK, where privatized enterprises operate under government regulation.

I share a common cause with @AndrewYang, @pmqrcq, @garrytan, @ezraklein and others who believe that (1) tech can support abundance as the primary driver and (2) government should regulate and enforce right action.

What do you think?