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Well... one refrain I keep hearing from government is "Please, small businesses save us from ourselves because everything we do seems to accumulate a 20x overhead!"

http://ecorner.stanford.edu/material_mobile.html?material=34...

A big reason is that governments have to be accountable to the public. We ourselves create quite a lot of pressure that creates the waste. That, and of course a lot of people inside and outside governments who try to steal something. See for example procurement and bids in public projects.

Totally agree. If you listen to the linked conversation, the major source of overhead they discuss is the layers and layers of requirements an assurances that have been accumulated into the procurement process. I get the impression that every time a govt project goes 4x over budget, someone adds a new requirement "To ensure this never happens again!" After a few decades of this, we end up with a guarantee of 20x overhead.

Who defines 'social good'? You assume an elite that can determine efficiency! This is the socialist conceit.

Milton Friedman:

“There are four ways in which you can spend money. You can spend your own money on yourself. When you do that, why then you really watch out what you’re doing, and you try to get the most for your money.

Then you can spend your own money on somebody else. For example, I buy a birthday present for someone. Well, then I’m not so careful about the content of the present, but I’m very careful about the cost.

Then, I can spend somebody else’s money on myself. And if I spend somebody else’s money on myself, then I’m sure going to have a good lunch!

Finally, I can spend somebody else’s money on somebody else. And if I spend somebody else’s money on somebody else, I’m not concerned about how much it is, and I’m not concerned about what I get. And that’s government. ”

Spending somebody else's money on somebody else describes a large fraction of what many employees of a business do. It looks to me as if those employees generally do a decent enough job of buying useful things at a reasonable price.

How can that be, given what Milton Friedman says? Two reasons. First: there are incentives in place to encourage them to do it. If they buy useless things or spend too much money, someone may notice and they may lose their job. If they find a particularly good bargain, they may be rewarded. Second: most people are not perfectly selfish utility-maximizing homo economicus, and even when spending "somebody else's money on somebody else" they do in fact prefer to do so in a way that benefits the second somebody-else at not too much cost to the first one.

Guess what? Much the same applies in government. Suppose you're a doctor in a nationally-run health system like the UK's. You examine a patient and prescribe a drug. Does the fact that you're spending "somebody else's money on somebody else" really mean that you won't prefer to prescribe a drug that actually helps the patient's problem? Does it mean you won't prefer a cheaper drug over a more expensive one that performs no better? Of course not. And if in fact you are the way Milton Friedman professes to be -- if you prescribe with blithe indifference to whether your patients live or die and to whether your national health service goes bankrupt -- then there's a real risk that someone will notice and you'll be out of a job, or pilloried in the newspapers, or something similarly undesirable.

At least one person downvoted the above. If someone who did is reading this: I would be very interested to know why.

(I don't at all object to being downvoted. But if I'm thinking incompetently or writing badly or being obnoxious or something, I'd like to know what's wrong so that I can fix it. And I haven't been able to figure out what's downvote-worthy in the parent of this comment.)

The problem with government is that the bar to fire people is too high for it to work the way you describe. And it's that way for a reason.

The system used to be that, when a party won an election, they'd fire the existing government employees, and replace them with members of their party. "To the victor go the spoils", and this was called the "spoils system". But that meant that the knowledge of how the day-to-day government functioned got lost after every election, which was non-optimal. So laws were passed to eliminate that practice, but at the price of making it hard to fire government employees. (Add in public sector unions, and it gets even harder.)

At least in a democracy, you can vote people out, so in theory, the general public has a say in what 'public good' billions are spent on. The problem with relying on philanthropy to fund the public good is: How do I, as a member of the public, influence what the Koch brothers consider to be 'public good'?

Great point,never realised thats the reason,may i say it has a very negative effect when you have tolitarian type admin with no,age limit on appointments,cant admins be obliged to shift people to other sections or sack people after 12 years if results of department had a lacklustre performance ,when opposition wins? On the VC thing i think it stifles compatition and tax paying and i dont want to have any taxes diverted for somebody to go into space its not making my life any easier .id prefer all companies pay full taxes in 1)the countries where the raw materials are sourced ,2) the credit card payment,end user country ,rather than keepng money in convinient little tax places ,charity setups and all that stuff ,its getting very unrealistic feeding of other peoples hunger and poverty and thinking your doing good!

> Who defines 'social good'? You assume an elite that can determine efficiency! This is the socialist conceit.

Er, no, democracy defines it.

What if the democracy is roughly split 50/50 on the issues of what defines social good?

People voting define social good, obviously. That is the conceit of any 'proponent of Democracy'. Whoever has power decides where resources are spent. You're suggesting whoever currently happens to have money should have power (how convenient). I'm suggesting the people in a country should have power, which is incidentally not a new concept no matter how much you treat it as such.

If you don't let the voting populace define and work towards social good, wealthy and powerful elites define social good, or more likely, pretend the concept doesn't exist or that they don't understand it as you have.

Our shared brain architecture, and universal moral basics that come from it, are what defines both individual and social good. Whether you have a benevolent dictator or an utopian democracy, it doesn't matter - both can figure out and achieve social good perfectly well.

Of couse we don't live in a perfect world, and so the elite can be counted on to be and stay benevolent. But neither you can count on voters not being stupid, or entrepreneurs not being greedy.

It's not that we can't figure out what problems are to be solved. It's that we let huge amounts of bullshit take precedence.

Assuming a central elite of politicians is uniquely qualified to define and fund 'social good' through legislation is just like assuming a central elite of billionaires is uniquely qualified to define and fund 'social good' through philanthropy.

On what basis are you claiming that the government could have equalled SpaceX's achievements? SpaceX has made several firsts that no company or government ever has before.

Receiving money from the government doesn't mean the government could have done the same thing.

Landing their first stage was huge, but what other firsts have they had? All the others seem to be of the form "first private X" which excludes government only by definition.

Indeed. They had a lot of "new and put into practice" things - a new engine design, a new way to manufacture rockets, a new way to manufacture engines (were any other operational engines 3D printed before?). They improved on quite a lot of things. But "firsts"? Not many indeed.

Are you on crack? In what respect does SpaceX's achievements equal large government pushes like the Apollo program, that got a man on the moon almost 50 years ago!! Or the Manhattan Project? With almost complete certainty I can say that government projects could have achieved everything SpaceX has... now wether as efficiently or quickly I'll grant is up for debate.

I think that it's SpaceX that is one of the few companies that can actually achieve something similar to Apollo or Manhattan Projects. Both the Moon Landings and the atomic bomb development had strong non-monetary motivations. People at all levels, from the lowest worker to the highest manager, cared very much about the project's success, and not just about their own pockets. Just like Elon cares about Tesla and SpaceX. Also, completely unlike most today's companies, and completely unlike today's government.

> SpaceX has made several firsts that no company or government ever has before.

Not meaningfully, not yet. They've landed the expensive part of a satellite launch system, which is very cool but the USG did it 30+ years ago. I don't think the difference between a vertical and a horizontal landing is that important.

And fundamentally there's no magic private industry pixie dust. A company is just a collection of people, as is a government; they both have to obey the same laws of physics. In some cases competition drives private industry to be more efficient. In some cases the government's long time horizons, trusted position, and ability to do things where the benefits are widely diffused make it more efficient. But it's only ever a matter of efficiency, not of can or can't.

> Receiving money from the government doesn't mean the government could have done the same thing.

It means that government money was a vital part of making it happen. SpaceX built their system on the back of $X from Musk and $Y from the USG (among other sources). If we took some money out of the X pile and put it in the Y pile, maybe the result would have been worse, maybe it would have been better.

Remember that most of SpaceX's core technology was literally given to them by NASA, and on top of that they're getting guaranteed contracts by the government (i.e. the dreaded government funding - they don't know how to allocate capital, right?).

Even the landing of the first stage was mostly based on NASA research. Which by the way, NASA had achieved long ago.

SpaceX innovated with their cost cutting, and maybe now their manufacturing processes, and by being lucky by benefitting from a period of cost cutting by NASA whereby they could hire a bunch of NASA engineers/scientists.

An entrepreneur who lucked into a company that made him billions is not necessarily more qualified than anyone else to allocate society's resources. I'd also argue that a politician that managed to win a popularity contest is also not necessarily qualified to allocate society's resources. But at least the latter is, in theory at least, accountable to that society.

There are probably lots of smart people out there qualified to allocate society's resources, but they tend to not become billionaires or win elections.

Reminds me of this:

http://www.lrb.co.uk/v28/n07/slavoj-zizek/nobody-has-to-be-v...

I look at the billionaires, and I wonder if you're right. But then I look at Congress...

NASA's achievements have been impressive, to be sure. I don't want to discount that. However, it has accumulated some inefficiencies and some stagnation over the decades.

What NASA has achieved, they've done so with over $1 trillion in inflation-adjusted capital funds over the decades, that have been allocated to them.

What is debatable is whether or not they've made or always made efficient use of the capital they've been allocated.

Space X has innovated on a number of fronts with less than 1500 employees and only a fraction of the capital that NASA has been allocated. For one, the Space Shuttle program was costing the U.S. $450 million+ per launch. A Falcon 9 launch costs an average of $57 million. There is proof that he can allocate capital better than the government.

> Space X has innovated on a number of fronts with less than 1500 employees and only a fraction of the capital that NASA has been allocated. For one, the Space Shuttle program was costing the U.S. $450 million+ per launch. A Falcon 9 launch costs an average of $57 million. There is proof that he can allocate capital better than the government.

No it's not. The requirements on the two systems were not remotely the same, and it's not surprising that a system built 30+ years later with the lessons of the previous system in mind would be more efficient.

NASA is still around, you know. They could jump in at any time and make it happen, rather than pay some contractor cost-plus for it...but they don't. The red tape they have to deal with to get anything done is just too great.