But it occurs to me that, by your own admission, the really high risk, blue sky R&D that happens in universities and government programs isn't done for profit.
Indeed it isn't. Eventhough succesfull projects will likely result in a patent or alike, which will make some (or a lot of) money if the technology ends up being used by the commercial sector.
However, it IS being paid for
with "profit money".
The money being injected into university programs, doesn't fall from the sky. That's all cash that has not only been earned, but which was in
surplus.
One can only invest / donate money that one doesn't need to cover costs, wages, etc. So by very definition, the money being poured into such programs, is money that wasn't needed elsewhere. ie, profits.
Why, then should the lower risk, product development aspect of getting novelty to market necessarily be funded this way?
Same reason, I'ld think. You can't invest what you don't have. Neither can you invest what you need for yourself.
I'm not saying that it can't be done however... But, like someone else here said, communist states are a great example. Just look at the development of both soviet russia and the US during the cold war.
Looking back, this was a war of technological progress.
The US didn't "win" the war by fighting. The US didn't "win" at all, I'ld say. Rather: the soviets lost. The free market system of the US turned out to be a far more efficient engine to power this motor of innovation and learning.
The nukes being developed are a great example.
The soviets had the "most powerfull" ones. The reason for that was not that the US couldn't make them that powerful, because they easily could. Rather, it was a case of the US not requiring such powerfull bombs, because their technology was just far more advanced. The guiding system was a LOT more accurate and precise.
The soviet bombs were more powerfull, because they couldn't be confident enough that the bomb would hit the intended target. By increasing the "explosion radius", they made sure that the target would be hit nonetheless. US rockets were just a lot better.
US scientists aren't "smarter" then russians....
They just had far bigger budgets to work with, accross the entire line. Thanks to the free market economy.
Monster profits = monster piles of cash
Low to no profits = no budgets.
Also, how can you even counter profits?
Take Apple again. Let's say that to cover the total development cost of iProduct, they need to sell 1 million of them.
What do you do after that 1 millionth piece is sold? Forbid them to continue selling? Force them to give them away for free?
Have them turn over ALL the income from the 1 millionth and 1 sale to the government?
Or forbid "private companies" alltogether and put it all in government control?
There's an incredible amount of implications here.
Having said all that, I'll close with one of my favorite Plato lines (at least, I think it's a Plato line - some ancient greek dude anyway):
"
The best form of government is a dictatorship, where the dictator is someone enlightened whose only concern is the best interest of the entire society and all its citizens, and who will never act out of self-interest"
But like that old Greek dude, I agree that that is just a delusional utopia. To the best of my knowledge, a capitalistic secular democracy with a regulated free market is the next best thing.
