The Palmetto Prize: Let’s do something great with $21.5 Million
By Phil Noble
We’ve all seen the advertisements for the TV lawyers promising big bucks if we sign up with them on some big class-action suit for mesothelioma or asbestos or some other product or medical liability case.
Well, we in South Carolina just had a big payoff on one of these big class-action lawsuits and we now have an extra $21.5 million. The question now is, what are we going to do with it?
The specifics of the case really don’t matter much but in short, here’s what happened. Standard and Poor’s, one of the big Wall Street heavies sort of cooked the books on its ratings of toxic mortgage investments and that helped set off the big global financial crisis we had back in 2008. Nineteen states, including South Carolina, joined the suit and S&P offered a deal where they would not admit guilt but would pay out $1.38 billion to settle the case.
So much for the details; the important part is that we as a state have $21.5 million we were not counting on, and so what are we going to do with it?
Now the traditional political response would be to put it in the state’s general fund – the big pot of money we use to pay for the day-to-day operation of what the state does: education, roads, prisons, etc. But let me humbly suggest we do something else besides dumping the money into the black hole called the general fund – let’s use the money to fund a prize, or several prizes, to try to do something big and bold and important for our state.
Here’s how it would work. Instead of deciding that we needed to do something – say develop a better system to reduce infant mortality – and creating a new government program with all its bureaucracy, paperwork and red tape, let’s offer a cash prize to anyone who can come up with a better solution. Based on specific criteria that defined success, people could compete to develop a better idea and get paid, as opposed to spending the money on a traditional bureaucratic solution.
This idea of offering a prize to get people to try and do something big and spectacular has a long and fruitful tradition throughout history. Just one example – everyone knows that Charles Lindbergh was the first person to fly across the Atlantic non-stop. But Charlie wasn’t doing this just for kicks, he was competing for the Orteig Prize, $25,000 ($350,000 in today’s money) offered by Raymond Orteig.
Orteig was an interesting character. He was born in France and spent his early years tending his father’s sheep in the Pyrenees Mountains, but he had big dreams. He emigrated at age 12 to New York and started working as a bar porter at a restaurant and worked his way up to become the owner of the Lafayette Hotel and restaurant. The Lafayette was a favorite hangout of World War l aviators who fascinated Orteig with their stories of daring exploits and bravery.
Orteig offered the prize in 1919 and the goal was to provide a boost to the nascent aviation industry and as “a stimulus to the courageous aviators” by offering his prize for achieving this big and audacious goal. Most people thought it was impossible. Lots of folks competed for the prize but it was only in 1927, eight years later, that Lindbergh successfully completed the flight and collected the money – as well as the great fame and fortune that made him one of the first global media superstars that kids learn about in school today.
Many years later, the Orteig prize inspired the most recent “big idea” prize competition- the XPrize Challenge. Funded by Google and other visionary (rich) folks, the XPrize offers prizes of tens of millions of dollars focused around issues like global childhood learning, clean water, no-soil agriculture, space exploration and other big ideas that can have a substantial impact in solving global problems. Some of the prizes go for big global challenges and others go for smaller but still important issues or problems.
Here is how they describe themselves: “An XPrize is a highly leveraged, incentivized prize competition that pushes the limits of what’s possible to change the world for the better. It captures the world’s imagination and inspires others to reach for similar goals, spurring innovation and accelerating the rate of positive change.” (Learn more at XPrize.org.)
My favorite is the Global Learning XPrize for $15 million that challenges teams from around the world to develop open source and scalable software that will enable children in developing countries to teach themselves basic reading, writing and arithmetic within the 18 months of a competition field-testing period.
Another really cool feature is that they let people – ordinary people like you and me – suggest what kind of problem should be the focus of an XPrize and then anyone can vote on what’s the idea or problem the prize should try to solve.
Now think about this idea and South Carolina. What big problem do we have in this state that we want to try to figure out and solve? There are lots of them.
So, to our governor and the legislative leadership that is going to decide what to do with this $21.5 million, I say (with apologies to the late Steve Jobs) – Think Different.
Think Palmetto Prize. It could be something great!
Phil Noble is a businessman in Charleston and President of the SC New Democrats, an independent reform group founded by former Gov. Richard Riley to bring big change and real reform. email@example.com www.SCNewDemocrats.org