[ExI] long game ventures
spike at rainier66.com
spike at rainier66.com
Thu Feb 28 20:45:41 UTC 2019
From: extropy-chat <extropy-chat-bounces at lists.extropy.org> On Behalf Of Dylan Distasio
Sent: Thursday, February 28, 2019 12:10 PM
To: ExI chat list <extropy-chat at lists.extropy.org>
Subject: Re: [ExI] Michael Cohen
>…The situation in the 50s was a lot more complicated than what the Berners use as talking points in terms of effective tax rates:
That’s part of it Dylan, but the easily grasped part is this: super high marginal tax rates up top make too many long-game investments unattractive.
Unlike the 1950s, we have such long-game investments as bringing a promising new drug into the market. That is one of the most expensive, risky, high-payoff investments available today. Last I heard it costs half a billion dollars to get a new drug thru the FDA, and even it does, that is no guarantee of not getting sued to the cufflinks if the FDA misses something and it turns out to cause something else. In that case, the FDA is not liable, the drug manufacturer is liable. And even if it gets thru the FDA and doesn’t screw up something else, there is no guarantee some other competitor isn’t developing the same drug. And even if some other competitor isn’t, there is no guarantee the new drug will sell. And even if it does, the company can only clean up for 20 yrs, at which time the generics come calling, and your obscene profit is now seldom-seen.
Result: a new drug is a crazy-high risk venture at a crazy high price. So the winners need to be rewarded to make those long-game ventures attractive.
Most won’t make sense. Those which still do need to jack up the price to cover those taxes, which increase the risk the new drug will not sell, which increases the risk that no investor with a lick of sense will even bother to try.
Result: no new drugs or therapies.
Result: we die, just like the old days.
Lesson: keep government’s grubby paws off the biggie investors’ obscene profits. The chance to make obscene profit is what compels the super rich to play those long-game ventures. That’s why we still occasionally get new drugs and therapies, and why they cost so much when we do. Biggie investors are our friends. Their investments save lives. They are angel investors, these millionehhhs and billionehhhs. They are the good guys. I don’t care if they are motivated by greed or the chance to get obscene profit. They help us all. We should be making long-game ventures more attractive, not less.
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