Wednesday, October 13, 2010

Freedom enabled by freedom

In a combination of bravery, perseverance and technological innovation, 33 Chilean miners are now free after 70 days of subterranean confinement. As the WSJ quoted one Chilean involved in the rescue: “It was 75% engineering and 25% a miracle.”

But in Thursday’s paper, a WSJ columnist argued that we also need to take economic freedom into account:

Capitalism Saved the Miners
The profit = innovation dynamic was everywhere at the mine rescue site.
By Daniel Henninger
It needs to be said. The rescue of the Chilean miners is a smashing victory for free-market capitalism.

If those miners had been trapped a half-mile down like this 25 years ago anywhere on earth, they would be dead. What happened over the past 25 years that meant the difference between life and death for those men?

Short answer: the Center Rock drill bit.

This is the miracle bit that drilled down to the trapped miners. Center Rock Inc. is a private company in Berlin, Pa. It has 74 employees. The drill's rig came from Schramm Inc. in West Chester, Pa. Seeing the disaster, Center Rock's president, Brandon Fisher, called the Chileans to offer his drill. Chile accepted. The miners are alive.

Longer answer: The Center Rock drill, heretofore not featured on websites like Engadget or Gizmodo, is in fact a piece of tough technology developed by a small company in it for the money, for profit. That's why they innovated down-the-hole hammer drilling. If they make money, they can do more innovation.

This profit = innovation dynamic was everywhere at that Chilean mine. The high-strength cable winding around the big wheel atop that simple rig is from Germany. Japan supplied the super-flexible, fiber-optic communications cable that linked the miners to the world above.

A remarkable Sept. 30 story about all this by the Journal's Matt Moffett was a compendium of astonishing things that showed up in the Atacama Desert from the distant corners of capitalism.

Samsung of South Korea supplied a cellphone that has its own projector. Jeffrey Gabbay, the founder of Cupron Inc. in Richmond, Va., supplied socks made with copper fiber that consumed foot bacteria, and minimized odor and infection.
What I found fascinating was the broad range of technologies involved in the rescue. This was a complex operation, and a systems approach was required to solve the myriad of problems in both sustaining the miners and extracting them from 700 meters below ground.

Henning made another important point: the market supplied most of these technologies in advance of their need under extreme circumstances in Copiapó. Individual decentralized inventors solve problems without waiting for a command-and-control bureaucracy to request it.

Finally, the miners lucked out in another way: they have a successful entrepreneur rather than a lawyer for president. Sebastián Piñera made his fortune off LAN Chile, an unusual well-run transoceanic airline in an industry that requires mastering extreme levels of operational complexity.

It doesn’t hurt that Chile ranks ahead of the US in at least one yardstick of economic freedom. But then the economic resilience of Chile saved even more lives last March, during the strongest earthquake of the past 40 years.

1 comment:

Joel West said...

Alas, Mary Anastasia O’Grady says Piñera has ruled as a cowardly capitalist,and needs to restore the bold defense of economic freedom if he wants the 6% annual growth he promised.