GOP TAX PLAN

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Originally Posted by detbuch

In a previous post you said that "new technologies born from government funded programs" caused growth. Now you're saying that much investment goes to "automation," which would be a new technology related to a companies production, and that it reduces the need for employment. Which, I assume, is a negative impact on economic growth. But, somehow, if the technology is "born" from a government funded program, then it will grow the economy. Which implies that private investment in new technologies does not grow the economy, or even shrinks it, but government investment in technology will grow the economy.

In total, you seem to be saying that either business will sit on excess cash which loses value due to inflation, or invests in automation which reduces the work force therefor shrinking the economy, or, somehow, if the government provides fiat cash, it will grow the economy, or if government "invests" in technology it will grow the economy, but private investment in technology is either ineffective or will shrink the economy.

Very complex, and confusing.

I think you're making it complex and confusing, just like this new GOP tax plan. Now you can set up 529s for the unborn? This is the simplification that was touted?

A lot of private sector growth the past century has been led by government funding. That doesn't mean it all is, certainly business funds their own innovation programs to some degree.

From what I've seen though the real growth is most likely to occur when risks are taken that lead to really new ideas. These often aren't see as the most profitable or if really disruptive totally absurd. It's hard to automate something you've never done before so there's a surge of energy required to bring it to life. That creates growth.

A lot of business today is totally stale though, they look to be more efficient and minimize risks until the point at which they are obsolete. They don't do this what for a lack of capital -- many are still very profitable -- they do it as a matter of culture and a really big problem their religious adherence to the virtue of shareholder value.

But, this still remains the bulk of the corporate sector. If you want to spur growth just routing cash disproportionately to non-managerial shareholders doesn't seem like an effective place to put it. To do so at the expense of additional debt and inflation is even further counter productive.

This is a money grab plain and simple.