Risk Markets And Politics

Wednesday, August 03, 2005

Dear Left, This is why you fail...

I had mentioned the following example before, but I would like to re-iterate it given recent events. Stem cell research need not remain hostage to irrational currents in the government, and legislation-linked futures markets could be used by researchers to hedge these and other funding risks. This should be feasible especially at large universities that have free cash and employ people with significant investment backgrounds to manage it. Even if one or two insitutions partially hedged potential NIH grants on the order of $250,000, this would make for a significant market on the scale of Tradesports, and this would be just the beginning, both in depth and breadth of markets.

Let's take a step back and see what we are doing here. Formally, we are placing a check on the state's ability to distribute capital, but legislation-linked markets can simultaneously be used to further progressive goals. (Not that I would even describe the funding of embryonic stem cell research as "progressive"; it is simply rational.) Leftists have decried the power of capital as an inhuman force that swallows and "territorializes" everything, but they have ignored precisely its "pluripotentcy", its power to become nearly anything. So to all those well-meaning people on the Left who are naively against capitalism (including Zizek, the foremost continental socialist thinker) or are unwilling to understand and attempt to use its machinery, I say to you, "that is why you fail."

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