What happens when government shirks its responsibilities?  If the US government had decided not to play a part in opening up the American west, how long would the process have taken?  Without some kind of assistance, the railroad companies would not have been willing to risk millions of dollars to build a railroad from St. Louis to San Francisco.  Without government involvement, aviation would still be primitive, limited to short hops with few passengers.

One of the primary purposes of government is do that which the private sector can’t, or won’t do, when the results would be very beneficial.  The interstate highway system could never have been built by the private sector alone, because of the high cost.  Many people in rural areas would still be living without electricity if the Rural Electrification Act of 1915 had never been enacted.

Investors are constantly seeking ways to make more money.  Without leadership from government investment, they will put their money into whatever seems to offer the best returns.  Thus, we had a period where money was invested into financial derivatives, real estate, and leveraged buyouts.  Several trillion dollars of investor money poured into making more money, but the investments were not sound, and over 1 trillion dollars disappeared because of that.

It is my belief that the government refused to invest in what should have been the most rewarding technology we have ever discovered, choosing instead to focus on weapons technology and extending American influence into energy-rich parts of the world.  Without clear leadership from the government, investment capital was thrown at any idea which might possibly pay off.

Now, we are seeing the consequences of that lack of leadership.  The American economy is collapsing, our industries are moving overseas, and debt is choking growth.  America is creating very few things that the rest of the world wants, and is forced to sell off land and infrastructure to purchase what we do not produce here.

It didn’t have to be like this.  In the 1970’s and ’80’s, the US could have been creating the infrastructure of the next industrial revolution.  We had the know-how and resources to pave the way for wealth creation on a scale that dwarfs anything that has gone before.  Instead of using the most advanced technology in the world to open up the next frontier, we choose to squander it.  We could have been building space stations, more advanced versions of the space shuttle, and exploring the Moon.  We could have been learning to process materials in zero gravity, creating products which can not be made here on Earth.

Had we taken the path into space, investment would have followed.  Private space stations would have been built, private expeditions to the Moon launched, and real wealth would have been created.  Investors would be putting their money into new industrial techniques, new transportation systems.  Products would be available that would revolutionize life on Earth.  Right now, we have no idea what can be done out there, just as no one could have conceived that aviation would completely alter the world.

So, instead of creating new wealth, investors are chasing imaginary wealth, wealth which evaporates overnight.  Instead of building the next generation of spacecraft, which would be in use for generations, we are retiring the only working spacecraft that we have.  Instead of expanding our world, we are watching it shrink.

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