"This broad process that we call financialization was sucking people from their normal disciplines of science and engineering, over into finance, to the point that we have a number of who commented to us, who worked at Goldman Sachs and elsewhere -- these were Ph.Ds in astronomy, physics and other things -- that some of the best conversations they had about their esoteric disciplines were while they were out to lunch at Goldman Sachs. Most of their fellow graduates were showing up at these places and not inside academia."
<p>I don’t think anyone contests that this happens regularly. The problem is… it’s a problem. It takes real dedication to pass on that kind of money, so it’s a shame that the prestigious science and engineering jobs don’t pay more or the finance jobs pay less.</p>
<p>Imagine if we could have taken the taxpayer capital used to bail out the financial system - not just the $800 billion of TARP capital injections, but also the myriad emergency liquidity facilities opened by the Feds to firms such as AIG that weren’t even technically banks - and instead redirected all of it to basic academic science & engineering research funding? Not only would that have created boatloads of science and engineering jobs, but more importantly, would have spawned multitudes of science and engineering innovations. The Internet, the Human Genome Project, GPS, supercomputing, radar - such wondrous inventions were developed or greatly enhanced by government research funding. </p>
<p>What else could we have discovered had we directed greater taxpayer funding to R&D? We’ll never know because we gave that money to the finance industry.</p>
<p>I wouldn’t call finance an industry. In my mind, the term industry implies that that sector actually produces something for the economy rather than pulling money out of a hat.</p>