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Libertarian Ideology Meets Nanotech Economics

From the perspective of a libertarian there's nothing wrong with the current funding mechanisms for emerging technologies that a little self reliance and free markets can't fix

2 min read

There seems to be a universal albeit naïve idea that politics should stay out of nanotechnology, or any technology for that matter. I am not at all sure how this is supposed to be achieved when at the end of last year governments around the world had invested over $40 billion in nanotech research, but scientists and engineers working on government grants either directly or tangentially like to believe they are untainted by politics.

So for those of you certain that political commentary has no place in discussions of nanotech take a deep breath. I came across this little gem in a publication called the Washington Examiner. Since I have never worked or lived inside the DC beltway, I have no idea of the politics of this publication, but the author, Ryan Young, is a Fellow at the think tank the Competitive Enterprise Institute, which I understand to be an organization to promote libertarian ideals.

The article came to my attention because I saw the headline “Nanotechnology: Innovation vs. Corporate Welfare”, which seemed to run contrary to my recent blog entry in which I vent my frustration at the millions being spent on shiny new research centers that enrich well-established construction companies. Meanwhile the financial support needed for bringing a technology from the lab to the market is largely unsupported either by investing models like venture capital or the kind of initial public offerings that fueled the Internet boom.

But Mr. Young sees it differently. And of course he has the advantage of arguing from the vantage point ideology rather than empiricism, which always paints a rather messy picture.

I concede that there may indeed be so-called nanotech companies that may be surviving from one government contract to the next. But would these companies resort to doing this if there were other financial instruments available to them?

Maybe the government should not get into the business of risky investments (tongue firmly placed in cheek) like funding nanotech companies or banks that leverage themselves 30 times to buy financial instruments based on bad loans. Maybe the Russian approach to developing commercial nanotech is not the way to go for bridging the gap between the lab and the marketplace.

But perhaps Mr. Young might offer some private sector funding tool that will get companies with little capital capable of bridging the seven to 10 years from a lab project to a commercial product because the ones out there now don’t seem to be working.

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