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Disappearing Tax Money

Reading the 16 September 2010 Cringely article makes me think that Americans actually like to elect Presidents like Beavis and Butt-head, churkling mindless and giggling and saying to nobody in particular, We are so ◊◊◊◊ ing clueless, huhhuhhuhhuhhuh. Why else would they support, and sign in law, acts that release tax money into the infinite ether, there to float away for all eternity.

Maybe I should let Mr. Cringely himself explain this:

The Obama Administration just successfully passed important small business legislation, for example, that has no value at all for tech startups. This probably shouldn't surprise us: former President George W. Bush was clueless about this stuff, too.

The new small business legislation intended to support startups is based entirely on debt — getting banks to lend money to small companies. But the only kind of debt that most tech startups know is credit card debt. Little tech companies grow by selling equity, not borrowing money. Short-term debt goes on plastic at 18 or 23 percent because no bank has — or will — lend to real tech startups in any significant amount.

[The banks will] finance new Burger King franchises, but lend money for electric cars or new kinds of data storage or — shudder — software? Forget about it.

Presidents Obama and Bush didn't know this, Fed chairman [Ben] Bernanke doesn't know it, nor does Treasury secretary [Tim] Geithner. None of these men have a minute's experience with tech startups, yet our economy is almost entirely dependent on those startups for real recovery.

Since all that tax money is not going to technology-based startups, where it is supposed to go, you have to wonder where that money is going. It is possible that there will be a lot of burger-flipping shops; but it will make America look like a taking-in-each-other's-laundry place, the very armpit of poverty. Or maybe it will go to purchase new furniture and computers for the local SBA office. It will surely NOT go to high-tech companies and anything else that has future jobs in mind.

The bill in question is the Small Business Jobs and Credit Act of 2010 (H.R. 5297), to create the Small Business Lending Fund Program to direct the Secretary of the Treasury to make capital investments in eligible institutions in order to increase the availability of credit for small businesses, to amend the Internal Revenue Code of 1986 to provide tax incentives for small business job creation, and for other purposes.

You don't know who Beavis and Butt-head are? You will: It's said that MTV is bring the series back.

Beavis and Butt-head
Written by Andy West on 17 September 2010.