Under Capitalism, The Wealthy Subsidize Innovation That Benefits Everybody Else
Remember those bricks wealthy people used to have in their cars? It would cost a dollar a minute or maybe more to call your honey to tell her you were running late.

Now, a little over a decade later, a homeless guy who sometimes sleeps in the bushes across the street has a smartphone.

Kevin D. Williamson writes at NRO:

The mobile phone is a case study in that process, as is the electric car, as indeed were ordinary cars. The firm that developed the first automotive air-conditioning and power windows was a high-end marque that despite its landmark innovations is no longer with us: Packard. The Bonfire of the Vanities-era financiers who carried the first mobile phones paid for much of the research and development that made them ordinary products for non-gazillionaires.

My own financial means at the moment do not, alas, afford the purchase of the new plug-in hybrid from Porsche -- which is a million-dollar supercar -- but the technologies developed for the 918 Spyder will make their way through the marketplace the same way that the automatic transmission (Oldsmobile, 1940), the supercharger (Mercedes, 1921), and the independent suspension (Mercedes, 1933) went from being expensive options on cars for the rich to being standard equipment on your Hyundai. We get our futuristic 21st-century cars the same way Johnny Cash got his Cadillac in 1976: One piece at a time.

F. A. Hayek wisely observed that this sort of experimentation is socially beneficial in no small part because the rich can afford to make mistakes and to follow technological dead ends: The technologies developed for the $100,000 Tesla or the $800,000 Porsche may not end up being the winners in the long run, just as many of the features of the 1983 Motorola DynaTAC were surpassed by those of competitors; but chances are that your high-tech supercar is not your daily driver, much less your only means of conveyance to work or the vehicle you use to get your kids to school, and if you own one, you can probably afford to make a sub-optimal choice. Most of the people facing the Betamax-VHS dilemma in the late 1970s were well off enough that going the wrong route caused no economic hardship.

Meanwhile, the government goes for the apparently crony capitalist hire of web-design firm CGI (where one of Michelle Obama's college buddies is a senior exec). After botching their part in the Obamacare rollout and getting fired, their punishment? Getting awarded a multimillion-dollar IRS contract to manage Obamacare issues.

Government, um, built that.

via @SteveStuWill