[FoRK] Obama: communitarian, redistributionist, confused? (from NYT)

J. Andrew Rogers andrew at ceruleansystems.com
Tue Aug 26 11:05:00 PDT 2008


On Aug 26, 2008, at 10:30 AM, Stephen D. Williams wrote:
> Raising the capital gains max rate to 20% from what, 15% it is  
> now[1], while eliminating it altogether for start-up businesses is  
> going to shrink the investment pool significantly??  That actually  
> sounds like a great improvement to me.


1.) Define "startup" in such a way that it does not exclude currently  
viable startups and prevents gaming by relatively non-viable  
startups.  These kinds of subjective business categorizations created  
by the government have been massively gamed in other areas and created  
gross market inefficiencies.  See: government contracting

2.) Explain why more capital should be put into "startups" and made  
less available to companies that would produce a superior rate of  
return in a free and fair market.  You are suggesting that redirecting  
capital from more viable companies to less viable companies is an  
"improvement".  What happened to the economy the last time the  
government effectively subsidized risk to encourage low-quality  
investment?  See: sub-prime lending


The economics do not pass even basic scrutiny; these changes do not  
occur in a consequence-free vacuum.  Whence comes this sudden lack of  
skepticism when someone promises you a free lunch?


Cheers,

J. Andrew Rogers



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