Nuclear Distortions

When scientists of the early 20th century realized the possibility of producing electricity from radioactive elements, such as radium and, in later years, uranium, research for harvesting energy from the atom grew stronger. With the discovery of the neutron, which has no electric charge, interest in nuclear energy grew even more as researchers recognized that neutrons could be used to split the atom and release immense amounts of energy. A new source of energy had been discovered.

During the late 1930s, Nazi German scientists discovered a potential use of nuclear energy to produce nuclear bombs. This rushed other scientists to petition their countries, including the United States, to develop nuclear weapons, consequently starting a race to build the first atomic bomb. The Manhattan Project arose from these developments, which produced the first atomic bomb being used on Japan to end World War II.

Up to the late 1940s, research and work on atomic energy was financed by private foundations and universities. After the war, the United States Government began to develop a civilian nuclear power industry, creating a monopoly over the atom, de facto controlling it. During the 1950s, the Atomic Energy Commission awarded subsidies and contracts to private companies to handle the operation and development of nuclear plants. However, many licensing requirements and many regulations towards peaceful atomic energy development distorted market allocation of resources (1).

Government monopoly of the atom and its lack of profit and loss incentives made atomic power inefficient and over-costly. Government secrecy greatly delayed engineers of the power industry from learning about the modern technology, therefore slowing scientific development. (1)

In recent years, a new proposal for using a more safe and environmental radioactive element called “thorium” (2). During the 1960s and early 70s limited research was done on Thorium, but in 1973 the U.S. Government halted funding in all Thorium research, while continuing support for other radioactive elements research. Many regulations of the 1950s, well into the 70s, required firms to produce uranium- and plutonium-based reactors similar to the reactor designs used to produce material for nuclear weapons, thanks to the Cold War (2).

While governments in the world distorted the nuclear energy research and development, research in the use of Thorium kept taking place in the last 40 years. Proponents of Thorium give several arguments for its use and technological development: (a) Thorium is more abundant than Uranium or Plutonium; (b) Thorium reactors do not produce a much nuclear waste as Uranium and Plutonium reactors; (c) the design of Thorium reactors diminish reactor meltdown and explosion; and (d) Thorium is difficult and inefficient to produce atomic weapons (3).

Opponents of Thorium development argue that: (a) Thorium reactors still need uranium to “jump start” fission with Thorium material; (b) Thorium does not eliminate the problem of “long-lived radioactive waste”, therefore, triggering a resumption of reprocessing in the US; (c) the fundamental problems with nuclear power are not eliminated with Thorium reactors (4).

In recent years, the U.S. Government began to work on legislation to promote Thorium. Many nuclear regulators have stated that Thorium technology has potential and also promote legislation to force the Department of Energy and the Nuclear Regulatory Commission to create new offices to study Thorium-fuel options (5). Here, we see again Government trying to intervene in the nuclear energy market, as it did in the 1950s. Mises clearly stated the question whether interventions are practical:

“Government or any organization of coercion can at first achieve what it sets out to achieve through intervention. But whether it can achieve the remoter objectives sought indirectly by the intervention is a different question. And it must further be determined whether the result is worth the cost, that is, whether the intervening authority would embark upon the intervention if it were fully aware of the costs.” (6)

Back in the 1950s, it was the Cold War that prompted the U.S. to develop and promote a uranium and plutonium nuclear program. Currently, the U.S. government is willing to intervene again to tackle the issue of global climate change by promoting “cleaner” energy sources such as Thorium, wind, or solar energy. Whether Thorium-based nuclear energy is better or safer than using Uranium or Plutonium, or any other source of energy, it is the job of entrepreneurs to ascertain and fulfill the general public’s needs. It is difficult to know how the energy market would have been, had the government not interfered in its developments since its discovery at the beginning of the 20th century. Mises lays it out succinctly:

“We constantly observe that entrepreneurs are succeeding in supplying the markets with more and better products and services despite all difficulties put in their way by law and administration. But we cannot calculate how much better those products and services would be today, without expenditure of additional labor, if the hustle and bustle of government were not aiming (inadvertently, to be sure) at making things worse.” (7)

As Murray Rothbard puts it in Man, Economy and State, “the free unhampered market is nothing more than the nexus of voluntary exchanges, a market-grounded society would be one characterized by the absence of ‘coercion’ or ‘political power’,” a notion that should be fully implemented in the development of nuclear energy to produce electricity.

References:

Science, Technology, and Government, Murray Rothbard, 2004 [1959]. Pp 22-24

Why aren’t we using Thorium in Nuclear Reactors? Adam Hadhazy, Discover magazine, June 2014

Superfuel: Thorium, the Green Energy Source for the future, Richard Martin, 2012

Thorium Fuel: No Panacea for Nuclear Power, A. Makhijani and M. Boyd, 2009

Cleaner Nuclear Power? Peter Fairley, Technology Review, November 2007.

Critique of Interventionism, Mises, 1929, p 5

Critique of Interventionism, Mises, 1929, p 15