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Diane Coyle – An Actual Economics Professor – Wants A Tax Paid Google And Facebook

It’s amazing how many economics professors are prepared to ignore economics when they want to make some political point. Such is what has afflicted Diane Coyle in her call for a publicly – read taxpayer – funded Facebook and Google. She’s simply forgotten or ignored all she knows about economics in order to push her pet theory. Which is, roughly enough speaking, that there should be something like the BBC, funded like the BBC, with the same great and the good running it as with the BBC, to compete with Facebook and Google:

The writer, a former vice-chair of the BBC Trust, is Bennett Professor of Public Policy at the University of Cambridge

That explains the why easily enough, doesn’t it? Having tasted those BBC lunches who wouldn’t argue that they should get another bite at said cherry cake? But, you know:

Maybe there is a more direct approach: let us build public service digital corporations that offer better services to consumers.

Apparently Professor Coyle thinks there is a shortage of venture capital in the computing industry. Anyone think that someone able to provide better services won’t gain financing? In which case, why do we need that publicly funded option?

The need to sell advertising is at the heart of the toxic behaviour of many of the social media companies.

The need to levy and collect taxes is at the heart of the toxicity of publicly funded alternatives. Who pays will change from those doing so voluntarily to all doing so involuntarily. As all economics professors know this is a reduction in human wealth. Quite apart from, or over and above, the inefficiency of the proposed management and design. We know that taxation has costs. And sure, sometimes it’s worth them too. But could we see some evaluation of that perhaps, or of it being true here?

An alternative provider with a different business model would compete on the quality of its service rather than — as now — the number of clicks.

As above, a better service will gain funding anyway, why the public option?

It is time to try a mixed economy in those digital markets whose products are in fact classic public goods, such as search and social media. It is more likely to be effective than the other policy options we have.

Seriously? Something that is obviously excludeable is now a public good?

As I say, it’s amazing how much economics a professor can forget when they’ve a policy to push. As is said elsewhere of this, it wouldn’t work anyway:

And here’s what Andreessen Horowitz tech analyst Benedict Evans makes of the idea, via Twitter:

No, the objection to a “publicly funded alternative to Google and Facebook” is not that it’s unfair competition – it’s that it would squander public money on something with absolutely zero chance of working . . . Something fascinating in trying to work out how many layers of misconception you can have to think that you can wave a ministerial wand to create another Google.

Ya know? How many highly motivated, highly funded and highly compensated people have managed to create a better Google? And we’re to give the job to bureaucrats?

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Southerner
6 years ago

A good way to measure the quality of an online offering is the number of clicks.

Whether it’s a blog page or a picture of a Trump balloon, success can be measured by clicks leading to views and perhaps even to online sales.

Chester Draws
Chester Draws
6 years ago

Imagine how other countries would react to a successful alternative to Google run by a major power.

China doesn’t even like a private Google. Russia’s alleged interference wouldn’t begin to cover what it could do.

It would be excluded by everyone in their home territory. So you would have to find a Google, without it’s reach.

Spike
6 years ago

A “Professor of Public Policy at the University of Cambridge” is not an economist but in political “science,” one of the soft “sciences” that serve as cover to let ideologues indoctrinate youngsters but wrap themselves in numbers for protection. “let us build public service…corporations that offer better services to consumers” — The utteror ought to have to explain the dysfunction of the American public school system, which is failing so spectacularly as to pull down measurements of the entire nation in math and science proficiency. It is truly good for nothing except swatting away all threats to itself. Of course… Read more »

Rhoda Klapp
Rhoda Klapp
6 years ago

Remember Myspace, Vista, Netscape, Yahoo, AOL? Lucky they were not subject to government support and subsidy, eh?

Oh, and just for the purpose of reducing my ignorance, what exactly is the problem?

Entirely OT, some chap was on my telly this morning touting compulsory voting and ‘political education’ in schools. This is in no way fascist. At all.

John Galt
6 years ago
Reply to  Rhoda Klapp

Entirely OT, some chap was on my telly this morning touting compulsory voting and ‘political education’ in schools. This is in no way fascist. At all.

Your “chap on the telly” is quite correct. Absolutely no fascism involved. It’s Marxism.

maffski
maffski
6 years ago

The good(?) news this has already been tried.

Lilly Cole and Impossible.com – £250,000 of our money pi**ed up the wall.

jonjermey
jonjermey
6 years ago

Here in Australia our former Labor government got all excited about the digital age and pledged to make a national broadband network, paid for out of taxes, so we could all be connected. That was ten years ago and it’s just nearing completion — wildly over budget, riddled with complaints and technologically backward compared with what’s currently available. Technology and government is not a good mix.

Felipe Grey
Felipe Grey
6 years ago
Soarer
Soarer
6 years ago

Felipe – peanuts.

Even The Groan couldn’t ignore NHS IT under Labour:

https://www.theguardian.com/society/2013/sep/18/nhs-records-system-10bn

£10bn!

BB01
BB01
6 years ago

Wasn’t somebody at the BBC complaining recently that the public funded BBC just couldn’t compete with the privately funded Netflix?

BB01
BB01
6 years ago

Wasn’t somebody at the BBC complaining recently that the public funded BBC just couldn’t compete with the privately funded Netflix?

maffski
maffski
6 years ago

The good(?) news this has already been tried.

Lilly Cole and Impossible.com – £250,000 of our money pi**ed up the wall.

Rhoda Klapp
Rhoda Klapp
6 years ago

Remember Myspace, Vista, Netscape, Yahoo, AOL? Lucky they were not subject to government support and subsidy, eh?

Oh, and just for the purpose of reducing my ignorance, what exactly is the problem?

Entirely OT, some chap was on my telly this morning touting compulsory voting and ‘political education’ in schools. This is in no way fascist. At all.

John Galt
6 years ago
Reply to  Rhoda Klapp

Entirely OT, some chap was on my telly this morning touting compulsory voting and ‘political education’ in schools. This is in no way fascist. At all.

Your “chap on the telly” is quite correct. Absolutely no fascism involved. It’s Marxism.

Spike
Spike
6 years ago

A “Professor of Public Policy at the University of Cambridge” is not an economist but in political “science,” one of the soft “sciences” that serve as cover to let ideologues indoctrinate youngsters but wrap themselves in numbers for protection. “let us build public service…corporations that offer better services to consumers” — The utteror ought to have to explain the dysfunction of the American public school system, which is failing so spectacularly as to pull down measurements of the entire nation in math and science proficiency. It is truly good for nothing except swatting away all threats to itself. Of course… Read more »

jonjermey
jonjermey
6 years ago

Here in Australia our former Labor government got all excited about the digital age and pledged to make a national broadband network, paid for out of taxes, so we could all be connected. That was ten years ago and it’s just nearing completion — wildly over budget, riddled with complaints and technologically backward compared with what’s currently available. Technology and government is not a good mix.

Felipe Grey
Felipe Grey
6 years ago
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