Everyone knows what a bubble is these days. It's hard to miss once you've been in it and then had it deflate. Housing is an obvious example. I recall considerable groaning in 2000 when tech-heavy 401Ks suffered after a similar bubble went flat for IT. But what if I told you there's such a thing as a think tank bubble?
Gentle readers may recall F.A. Hayek of spontaneous order fame. He had some other good ideas, too—like the so-called "structure of production." Imagine a triangle—"'The Structure" with one side down and an angle up like the letter A. Divide it horizontally into thirds with two parallel lines. Now the Structure has three basic sections. At the top of this Structure, let's put "Capital Goods." These are things that are raw and need to be transformed if anybody is to use them. Below, label the second section "Production Goods." Now we have a transformative layer, a place where certain kinds of goods (technology, manufacturing equipment, skilled labor) can transform capital goods. But transform them into what? In the third section, let's put "Consumer Goods," like iPods, clothing, pizzas, and so on. The basic idea is that goods must pass through these layers before they get to store shelves and homes. Nothing earth-shattering here, but helpful when pointing out how value can be created at each stage.
A lot of people working in the Freedom Movement see ideas as going through a similar production process. Wonky types call this the "Structure of Social Change." Imagine a similar triangle, except this time with ideas; policy ideas. Academics start out with abstract theories in, for example, economics. Think tanks take these ideas and run them through the policy sausage grinder. Eventually, they either a) become talking points that people start to believe in, and/or b) get implemented by government, resulting in social change. Good ideas and bad ideas get sent through this process with equal gusto. Indeed, all too often, bad ideas make it to implementation because unlike consumer goods, policy ideas don't face an army of consumers who vote with their dollars. Policy ideas, instead, must face only a phalanx of horse-trading politicians and an occasional flock of rationally ignorant sheep hopped up on vagaries like "hope" and "change". But I digress. The jist is: idea > policy shop > implementation.
Now, what if I told you that the people with the bad ideas are doing a better job of getting their ideas through the Structure? And what if I told you that the reason the good ideas are failing to reach implementation is because they're trapped at the policy-wonk stage? Hence, the think tank bubble.
What if Apple had invested all of their resources into making even more types of iPods with even more features than they have now, but failed to market, advertise and — in the immortal words of Guy Kawasaki — evangelize them? Apple might be roughly synonymous with AMC or Polaroid. Of course, with think tanks, there's a different dynamic—particularly with free market think tanks. The big ones are still producing 40 page white papers that only 40 people will read. Funders are spending millions to let them continue to do so. But in the process of doing so, they have neglected implementation—that is, investment at the bottom of the Structure of Social Change, where everything counts. The people with the really bad ideas and the great marketing have put the bulk of their investments into implementation; activism, networking, messaging, and marketing. (Read: "Yes We Can." They can and, Lord help us, they will.)
So what is to be done? There are a number of things that can, indeed, must happen—if individual liberty and prosperity is to survive.
These three changes would go very far to making the ideas of freedom viable again. The institutions of freedom are crumbling due to neglect. People are buying cheap nostra and feel-goodism like Kool-Aid at a Jim Jones gathering. And who's selling them? The people with the bad ideas. But remember: one of the advantages of having good ideas is that, if you can get them out, they can form a mental latticework that is difficult to replace. Feel-goodism is ephemeral.
It is perhaps ironic that those who have learned to use distributed systems, local knowledge, networking, and voluntarism effectively in political activism haven't learned to apply these concepts to understanding the market economy. Likewise, those who understand the fundamentals of a market economy haven't learned to apply these concepts to engage successfully in political activism. That's a dangerous asymmetry. After all, the ones who are successful at political activism end up with the power. Government grows. Power corrupts. Markets languish. We all become poorer and less free. So, if the Freedom Movement is going to gain any ground back, we are going to have to learn to play the game better. We're going to have to change our freedom portfolio and let the think tank bubble deflate.
