Some private financing of public goods

The best argument for the feasibility of private financing of public goods can be found in Anthony de Jasay’s 1989 book Social contract, free ride: An examination of the public goods problem (Clarendon Press). As a bonus or malus, you will also find an argument against social contractarianism à la Buchanan. De Jasay’s book is a technical book, not necessarily easy to read and not without flaws. I have summarized and criticized the argument a recent one Regulation article (see pp. 60-62). In a few words: let the individuals who don’t want to risk being deprived of a public good contribute to its financing and let freeriders enjoy their free ride. (After all, aren’t we “inclusive”? Equal freedom for all!)

A Economist article just provided an illustration of partial private financing in the most difficult case of public goods: territorial defense. The story concerns the development of shoebox-sized listening stations that detect the sounds of attacking objects, analyze them with smartphones or microcomputers and transmit the results to Ukrainian air defense operators (“How Ukraine’s new technology thwarts Russian airstrikes, The economistJuly 27, 2024):

Kievstar, a telecom company, installs Zvook’s kit on its cell towers, handles maintenance and transmits data all for free. …

A much larger acoustic detection network has been developed by a secretive Ukrainian outfit called Sky Fortress. It consists of several thousand listening stations, with thousands more planned. Although the first listening stations recorded and processed sound with Android smartphones, the network now, like Zvook’s, uses special microphones and microcomputers. The data is fed into a Ukrainian command and control system known as Virazh. Like ePPO and Zvook, Sky Fortress is largely funded by donations, an astonishing development for air defense.

Few outside experts are aware of how Sky Fortress works. One of them is Riki Ellison, founder of the Missile Defense Advocacy Alliance (MDAA), a nonprofit organization in Alexandria, Virginia. Sky Fortress has become so extensive and “so damn good,” he says, that it now detects most Russian munitions flying low into Ukraine. Russian units have begun to mute or otherwise change the acoustic signatures of their drones, but the detection algorithms adapt immediately. “This is AI at its best,” says Mr. Ellison.

The crucial sentence is the last of the second paragraph quoted above: “Like ePPO and Zvook, Sky Fortress is largely funded by donations, an astonishing development for air defense” – even if the restrictive “largely” suggests that there is also public funding is involved. . The economistThe article does not mention whether the volunteer contributors are Ukrainians or their supporters elsewhere in the world, which would further inform us about the general possibility of privately financing public goods.

Ukraine is not the rare bird that is called a free society, but it is certainly freer (or less unfree) than, say, Russia – free enough to see how independent innovation and private action make a difference.

Note that a public good for some is not necessarily a public good for others, as in this case for the invading army. This observation further supports the general idea of ​​giving individuals in ordinary social life the freedom to finance whatever they want, if they think it is worthwhile for themselves (regardless of their motivation). Note also that even in the freest of free societies, defense against international tyrants and criminals would be necessary – as I tried to illustrate with a fable in a recent post (“From the Fourth Millennium, A Tale for Libertarians”).

I am not claiming that these ideas will necessarily solve all political problems. But they cannot be ignored.