Forget tax changes and austerity; invest in R&D and education

From the USA, "Paddington" says: I'm trying to cause trouble again. I sent this to Michael Gerson of the Washington Post, and Paul Krugman of Princeton and the NY Times:

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There is a great deal of discussion on the amount of economic growth that can be generated by changes in tax or fiscal policy.

What appears to be missing in that discussion is the likely answer: none. In fact, the changes proposed are very likely to hurt the economy.

The reason is that all long-term growth can be attributed to innovation, discovery and conquest. The first two are themselves dependent on earlier basic science research. The last is one reason why the Roman Empire collapsed when its expansion stopped.

Without basic science research, open access to the results, and a lead time of 20-30 years, there is no major innovation. The technology boom which began around 1990 was built on the government-funded research of the 1940's through the 1970's, in computers and electronics. Companies do not generally invest in research until the potential profits are demonstrated. When they do so, the results are often treated as proprietary, which impedes human advancement.

The US reduced funding for basic science around 30 years ago, which is one reason that most 'innovations' that we are seeing are the offshoots of earlier work, and nothing really novel is appearing.

Added to that is the attack to trim university budgets and faculty lines. Those faculty members are the very people who generate much of that new knowledge, for the common good.

Finally, we have the escalation in the cost of higher education and the proposed elimination of tax write-offs for it, without the realization that most of the people who staff the laboratories of the country are from middle-class families. Children from wealthier families choose business, law and sometimes medicine. Why more children from poorer families do not choose the STEM paths is a matter of some discussion.

In short, we are proposing, as a country, to shut off every avenue for the very innovation that we need to thrive. Our policies are a recipe for economic disaster.