When I ask for a model or evidence for novel claims that R&D tax credits increase productivity, or in a unique way, I have an axe to grind. When you think R&D tax credits will stop companies from spending all their money on marketing, you’re a clear-minded thinker.
At any rate, I think I’ve made my opinion clear.
Yes, I’ve said that tax credits will singlehandedly transfer all marketing investment into R&D. Wait, I did?
Just out of curiousity how much do you think the R&D tax credit costs? I’m guessing you think it’s a pretty big deal, right?
the answer
$8 billion per year or about %0.3 of yearly federal tax revenue.
There’s a word for companies that actually pay the top marginal rate. That word is morons.
The business week article on the r&d tax credit from the original thread was way more detailed. Basically your goal is to spend more every year so that you can keep writing lots of stuff off. Which is great for some stuff, but not when your research boils down to Silly Walks, or crispier French fries. But whatever; it’s no worse than any other stupid thing.
There are lots of things society should spend money on. Large corporations that can’t survive without subsidies aren’t one of those things. Encouraging Microsoft to better distribute their income is fine, but we’d all be better off if they managed to get by on their own (or got replaced) and we all had a slightly lower tax burden.
Nothing compared to farm subsidies; kill that shit with fire!!
Cite. There’s no minimum company size in the law…
And hey, I’m sure you’re SO sad that this government canned our tax break in the UK, which was “only” expected to return 5:1, three days after taking power.
“I’d equalize dividend vs income tax rates tomorrow, and scrap all special case tax credits if I was Prime Minister.”
Sure for the first, long been a cause of mine. But ALL tax credits? As long as only rich women can ever work and have kids, we have no intention of having art or culture or R&D, or… (I could go on, but it’s not a good idea)
After mulling this around a little, I am in favor of this tax break for the following reason: it increases the pay of R&D by stealing from the rest of the economy. Why I am for that? (1) I work in R&D and I like money (hey, at least I am honest), and (2) I am for incentivizing people who are decent at math to work in R&D instead of in finance or other sectors.
My guess is that a directly funded government effort would yield better results but I’ll take what I can get.
You’d be better off with state sponsored daytime child holding facilities, government money strictly for blue sky research, and NGOs handling art and culture.
Frankly, the BBC (World) is a money spinning machine, it really doesn’t need government money any more than NPR does. It loves getting a license fee, but it’s as silly has having an established church.
Better solution for this is the one we’ve already gone for: tax the everloving shit out of finance. It does some nifty stuff in terms of boosting our peak growth rate, but it’s become this talent gobbling machine and has long needed a bit of a throttling.
Um…
No comment on most of what you said, because I’m just not going there again.
But, er, in the UK NGO’s do handle most of the art and culture. Or rather, they did…much of it’s been brought back in-house by this government. This isn’t the Government you were looking for.
Which is why you shouldn’t be saying things like this:
As long as only rich women can ever work and have kids, we have no intention of having art or culture or R&D
Er…I have absolutely no idea what you mean. You’re using pieces of different statements there.
This government has slashed childcare credits, which will force many women out of work as un-economic. And they’ve also managed to kill off the central clearing house for film in the UK, setting it back a decade.
If you think this is the government you were looking for, you’re having a laugh. Or are Tory. Same difference.
I’m willing to bet that google expected almost all of their fizzled products to have been profitable.
Pharmaceutical companies typically expect the vast majority of their drug research projects to fail.
Yeah, DiMasi at Tufts writes papers on this all of the time, with breakouts of total costs, success rates, capitalized costs, biopharma vs. pharma, etc. If anyone is interested in the detail just do a google of DiMasi and Tufts.
Yes and no. At the project level, yes. People at Google (whose culture I’m pretty well acquainted with, fwiw) are generally not working on projects they think will fail. At the company level, however, Google is well aware that many of its individual projects will fail. You can’t perfectly predict how products will launch but you have to be aware that many won’t stick especially if you’re throwing out as many things as Google does.
In fact if you just count all of the projects they’ve launched that didn’t catch on then you’re undercounting failed R&D projects by quite a bit as there are plenty of projects that got scrapped before they went live, internal tools that didn’t end up being used, etc.
Google’s far from the only company that does this. They just do it to such a large degree that they make a great example. My team engages in similar sorts of speculative R&D but on a much smaller scale, for example.