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> you can subsidize R&D With funds materialized from where? > sap trillions of dollars out of the economy Are you suggesting that the taxes collected would j

• zaroth 7y ago
  The trillions I was referring to would be to build new infrastructure that is more expensive to operate instead of less. It was already stated elsewhere, but if you spend investment dollars to decrease productivity, you waste money twice -- first on the new equipment, and second on the added cost for each unit output. So I guess you could say yes, if we collect the taxes and then sink them into substandard infrastructure, that effectively destroys a lot of wealth. Likewise, if you subsidize something to the point where an inferior product only makes sense because of the subsidy, that's destroying wealth. There needs to be a technological path which shows how any given piece of subsidized infrastructure can ultimately stand on its own. If the subsidized thing is structurally inferior, it has to be turned off the moment the subsidy is taken away, or the government is forced to subsidize it forever.
  • CuriousSkeptic 7y ago
    ok, thought you were arguing against taxes for subsidies. My own argument against subsidizing is simply the information problem. While a tax can add information to the market (this externality is expensive) a subsidy must be someones best guess at what should be done, which is most likely wrong. And as you point ultimately based on a distorted market. I guess a public dividend would be better, less distorting. And it would offset some of increased costs.