We hear it all the time. Let's cut taxes and deregulate so that entrepreneurs can work their magic. Only then can we spur entrepreneurialism and rejuvenate America's markets, the argument goes.
Well, guess what? Creativity and prosperous markets were with us long before Ronald Reagan and the current wave of deregulation, tax breaks for the rich, and other legislative gifts to America's financial mandarins happened. In fact, I'm pretty sure that Bill Gates and Steven Jobs weren't sitting around their garages waiting for tax cuts and deregulation to come up with their Microsoft and Apple ideas (go ahead, ask them).
Inventions and creativity have been happening since the dawn of time. History tells us this. Initiative and innovation are human constants, and depend on many factors that go beyond tax cuts and deregulation.
Benjamin Franklin's lightening rod, penicillin, and Jonas Salk's polio vaccine are examples of this. The influenza outbreak during WWI stirred curiosity and spurred some of the greatest publicly funded medical research that the world has ever seen. History is full of many other examples where phenomenal breakthroughs were made for reasons beside monetary gain.
The thing we want to keep in mind is that people invent and do things for reasons that go beyond the profit motive or tax cuts. Think about the things that were invented in the 1940s and 1950s when the tax rate on America's wealthiest wage earners was 90 percent.
Whether it's pride, personal goals, accident, art, nationalism, or simple curiosity, the human experience shows us that tax breaks aren't the only instigator behind human creativity.
Below is a very partial list of creativity and products that were built without the promise of tax breaks, the profit motive, or deregulation.
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THE NASA INVENTIONS ...
Do you like ear thermometers, memory foam, scratch resistant lenses, invisible braces, shoe insoles, satellites and long distance communication, ionized adjustable smoke detectors, road safety grooving (which cuts hydroplaning), cordless tools (for Apollo missions), water filters (ionized charcoal), kidney dialysis, cat scans, cancer fighting drugs and shiny hair, and deformable mirrors (which provide 100 times the imaging), among others? Thank NASA for directly building or having a hand in these and more than 6,300 other patented inventions.
But, contrary to common folk wisdom, TANG was not one of NASA's inventions. That's a myth.
THE MILITARY DISCOVERIES ...
The military connection ... Anesthesia (Civil War), nuclear energy, the computer (from code breaking), the internet (cold war invention for use during nuclear war), satellite communications, synthetic rubber, penicillin, jet engines (thank you German military scientists), submarine technology (American Revolution), and Pepto Bismol.
Perhaps the best example of a military-related invention is the story of the most popular gun in the world, the AK-47. Mikhail Kalashnikov, a Russian tank driver came up with the idea for the AK-47 while recovering in a military hospital during World War II. Around the world between 75-100 million AK-47s are in use today, which makes it the most popular gun in the world.
And if we want to stretch it, even the Rosetta Stone was discovered as a result of a military campaign (Napoleon's romp through Egypt). Anthropology and the study of languages haven't been the same since.
ACCIDENTS & SERENDIPITY ...
Do you like the microwave, Viagra, artificial sweeteners, Popsicles, brandy, Teflon, and penicillin? They were accidents of curiosity. So were Velcro, X-rays, the pacemaker, super glue, and play-doh.
Then we want to keep in mind that while Thomas Edison wanted to make money, reproducing music wasn’t what he had in mind when he invented the phonograph. And the list goes on ...
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As you can imagine, there are many more discoveries and inventions that have made the United States and our world a more comfortable, interesting, and dynamic place. And these discoveries weren't tied to tax breaks or deregulation. Curiosity, environment, and simple need matter.
Whether it's national security (nuclear weapons), concern over health (medicines), the thirst for knowledge, personal pride, the arts, or simple accidental discoveries it's clear that tax breaks and deregulation are weak excuses for hijacking both the economy and the legislative process in America.
What Wall Street and our nation's bankers want today are specific guarantees on return to go along with their bailouts. This is especially the case when we consider that 30 years of tax cuts and deregulation have produced little beyond $14 trillion in debt, a collapsed economy in 2008, and wealth gaps that rival the Gilded Age. Indeed, after 30 year years of the GOP's tax cut jihad America ...
... has reduced it's revenue source to such a degree that we now owe $14 trillion, instead of the $979 billion when Ronald Reagan entered office.
... has refocused the economy so that extractive financial instruments, which rest upon up-front fees and larger than life bonuses, dominate the mind-set of America's shadow banking system and Wall Street.
... has made America lose sight of the fact that innovation, curiosity, and inventions aren't entirely dependent on tax cuts for the rich. They never have been, and we shouldn't believe that they are today.
I'll go one step further. Tax breaks and deregulation are now political poison pills that have recklessly reoriented America's economy and burdened its financial future.
Think about it. Our 30 year tax cut race to the bottom has become the GOP's way of using the levers of the state to push an innovative and inventive spirit that has always been with us. But instead of spurring wealth creating innovations Wall Street and America's shadow banking system have focused their energies on creating wealth draining financial instruments that have done little but create a largely "symbolic" economy dependent on taxpayer bailouts.
Today, only a handful of individuals on Wall Street have benefited from 30 years of tax cuts and favorable legislation. Yet, the GOP is calling for more of the same. Worse, the collateral damage has been so great that many believe human curiosity and innovation in America today are dependent on the very same state sanctioned tax breaks and legislative gifts that brought us the financial blow back we saw in 2008.
Somehow using the state to create an economy that benefits a few at the expense of the rest doesn't strike me as the best way for getting the government out of the marketplace. In fact, in many ways, it makes today's financial titans almost entirely dependent on the state for their financial fortunes. Let's call it their Orthodox Paradox.
Look, after 30 years of tax breaks for the rich and deregulation America should be swimming in jobs and be pretty much debt free (as Reagan promised tax cuts would do, but Clinton's tax hikes were scheduled to produce). Instead we are trillions in debt and have an economy swamped by growing wealth gaps and unemployment, both of which are a product of tax cuts and favorable legislation for Wall Street's financial mandarins.
At the end of the day, people demonstrate initiative and inventiveness for many reasons that go beyond tax brackets and legislative fits. Telling Wall Street and our bailed out bankers that they can hide behind the economic uncertainties caused by their policies - which collapsed the economy and primarily benefited them - is the height of insanity.
But we have learned one thing from the GOP's 30 year race to the bottom. They really don't have a clue about American history, or what motivates the human spirit.
- Mark
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