Generations of seafarers have depended on the lighthouse at North Ronaldsay in Orkney and, while it is still a working building, the 60-strong population depend on its status as a tourist attraction as well. Wednesday is the 150th anniversary of the light going on at the famous tower, at 139ft the tallest land-based lighthouse in Britain and one of the most photographed landmarks in the country. Dignitaries including Jim Wallace, the deputy first minister and Orkney MP, will join the celebrations.It's absolutely appropriate that Mr Wallace attend this event as local MSP. (He's not an MP by the way!) But Jim's not only MSP for Orkney as well as being deputy first minister in the Scottish parliament. He is also minister for enterprise and one much criticised by the business community. In fact he's usually accused of knowing next-to-nothing about enterprise and the market economy. So here's some friendly advice for our Jim.
Why not take advantage of Wednesday's celebration to point out that:
Until that time (1974), conventional wisdom from John Stuart Mill to Paul Samuelson had claimed that the lighthouse was the quintessential "public good," which allegedly had to be provided by government due to the inherent free-riding of those who could not be charged for the services being provided. Coase showed, however, that in Britain, “contrary to the belief of many economists, a lighthouse service can be provided by private enterprise... The lighthouses were built, operated, financed and owned by private individuals, who could sell a lighthouse or dispose of it by bequest. The role of the government was limited to the establishment and enforcement of property rights in the lighthouse." Only later did the British government consolidate all lighthouse services under its own monopoly in order to eliminate competition and directly reap the financial benefits developed by private entrepreneurs.Think of it: At one stroke Jim would be free. Previously derided for his lack of understanding of the world of business, Mr Wallace would suddenly be the toast of free market think tanks across the globe. Entrepreneurs worldwide would be astounded to learn that economic wisdom was being proclaimed in the land of Adam Smith - by a politician! Inward investment would flow. Multinationals would relocate their headquarters to Scotland (if not Orkney) and Jim Wallace would be swept into power as the leader of a real liberal government. Go for it Jim.