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OBBB signed: Reinstates immediate expensing for U.S.-based R&D
- qiine 1y agoHumans play games to learn, the more AI do the same the better they will get
- tareqak 1y ago> Foreign R&D must still be amortized over 15 years
- macinjosh 1y agoAwesome, this literally could not be better for American tech workers.
- Den_VR 1y agoSo payroll for R&D is now entirely tax deductible? Businesses get to choose to pay taxes or do R&D for themselves?
- lazide 1y agoEither scenario taxes are paid - it’s just how and over what time period.
- tomrod 1y agoIn the long run, we are all dead. 20% depreciation per year for any software developed is a burden for all but the largest of companies.
- bobmcnamara 1y agoThis matched capex software. Weird how the depreciation schedule changes based on how the software was acquired.
- n_u 1y agoIt’s more about whether or not the company has taxable profits for that year (importantly these are not the same as real profits). I would read this article to understand more about how being forced to amortize tax deductions for expenses affects a business’s taxes. https://news.ycombinator.com/item?id=44180533 https://news.ycombinator.com/item?id=44180533 more info here too https://news.ycombinator.com/item?id=44226145 https://news.ycombinator.com/item?id=44226145
- alphazard 1y agoTax deductible is a weird way of phrasing it. It's not like these software companies were counting their money at the end of the quarter, and then deciding to do R&D instead of paying taxes. They had already paid R&D expenses to build the product, which gained them revenue. Previously they weren't allowed to actualize the cost of R&D all at once, so the business could be losing money, and still have to pay taxes on top of the loss (which is nuts). This fixes the problem, so now if you spend $100 on software developers, and you make $100 from the software, then you have $0 income, instead of $80 income.
- tomrod 1y agoIt was also weird because people pay money on income (dividend, partner payment, SCorp share, etc.) anyway, so in a long term view this incentivized companies to keep fewer software engineers on staff.
- beebmam 1y agoThere's also H-1B (and other worker visa) restrictions/costs imposed. Overall, quite good for the American tech worker
- Izikiel43 1y agoSource?
- beebmam 1y agoExtra $250 fee for visa applications: https://judiciary.house.gov/media/press-releases/big-beautiful-border-security https://judiciary.house.gov/media/press-releases/big-beautif... 3.5% remittance fees on sending money out of the US: https://www.globalimmigrationblog.com/2025/06/what-are-the-immigration-impacts-in-budget-reconciliation-bill-h-r-1/#:~:text=status%20could%20face%20new%20financial,both%20employees%20and%20sponsoring%20employers https://www.globalimmigrationblog.com/2025/06/what-are-the-i... Also (in above source), no ACA subsidies for H-1B visa holders (and others), which likely means employers they will have to pay more for health care if they want to cover their immigrant workers
- tareqak 1y agoQuoting all the fees in https://judiciary.house.gov/media/press-releases/big-beautiful-border-security https://judiciary.house.gov/media/press-releases/big-beautif... > Expansion of Immigration Fees: > $1,000 asylum application fee — first in U.S. history > $1,000 fee for individuals paroled into the U.S. > $3,500 fee for sponsors of unaccompanied children > $5,000 fee for sponsors of unaccompanied children who fail to appear in court > $550 fee for work permits > $500 application fee for Temporary Protected Status (TPS) > $400 fee to file a diversity immigrant visa application > $250 fee to register for the Diversity Visa Lottery > $250 visa integrity fee > $100 year fee while asylum applications remain pending > $100 fee for continuances granted in immigration court > $5,000 fee for individuals ordered removed in absentia > $1,500 fee to adjust status to lawful permanent resident (green card) > $1,050 fee for inadmissibility waivers > $900 fee to appeal a decision by an immigration judge > $900 fee to appeal a decision by DHS > $1,325 fee to appeal in practitioner disciplinary cases > $900 fee to file motions to reopen or reconsider > $600 application fee for suspension of deportation > $600 application fee for cancellation of removal (permanent residents) > $1,500 application fee for cancellation of removal (non-permanent residents) > $30 fee for Form I-94 (arrival/departure record), up from $6
- earth2mars 1y agoYes, but why the domestic r&d must be amortized only within 5 years? One way it is harder for finance to deduct all the expense within 1 year or they have to amortize only within 5 years. In case of foreign r&d expenses though they cannot detect in the year they incur but they have 15 years amortize. So I don't get the benefit of. In fact if they haven't touched this it could have been much better. In tcja they made it worse. And they fix it partially by making it deductible within the year they incur for domestic r&d. But the amortization still kills it.
- mischanix 1y ago[flagged]
- loeg 1y agoYou might look at the rest of the bill.
- me551ah 1y agoSure, foreign R&D still gets amortized over 15 years (NPV ≈59 % of a full write-off, so you “lose” ~8.6 % of your R&D spend in present-value terms, and only 6.7 % of the cost is deductible in year 1, creating a 19.6 % cash-tax gap). But offshore wages are often 50–70 % below U.S. rates: • Even after the slower amortization drag, hiring at half the cost nets you ~30 % total savings on R&D headcount. • On a pure cash basis you only need ~20 % lower wages to break even; most offshore markets easily exceed that. • So the labor-cost arbitrage far outweighs the tax timing penalty unless your foreign salaries are less than ~20 % below U.S. levels. In short: the 15-year amort rule hurts your tax deduction, but 50 %+ lower offshore wages more than make up for it.
- eric-burel 1y agoWhat qualifies as forein here? Employee located abroad, or hiring subcontractors from other countries?
- __turbobrew__ 1y agoHow does that actually work? Most large companies open foreign subsidiaries owned by the parent, for example “Microsoft” will own “Microsoft Canada” and employees working in Canada work for “Microsoft Canada” and NOT the main “Microsoft” company. The R&D done by Canadians is booked against Microsoft Canada, so in my mind the Canadian laws around R&D would apply and not the USA laws of 15 years old amortization? Am I missing something?
- rufus_foreman 1y agoActual title is "House Passes Tax Bill Sending to President for Signature – Details Inside".
- 9283409232 1y agoI think editorializing the title is fine in this case. The original headline is not descriptive and buries the part that would be relevant to HN.
- tareqak 1y agoI came across the article on Techmeme, and they used the following title: “President Trump signs the One Big Beautiful Bill, which allows immediate deduction of US software labor; foreign R&D still must be amortized over 15 years”.
- n_u 1y agoIt also classifies software development as R&D which together with immediate expensing for R&D undoes the Section 174 changes as far as I understand. “For purposes of this section, any amount paid or incurred in connection with the development of any software shall be treated as a research or experimental expenditure“ Page 303 of bill here https://www.congress.gov/119/bills/hr1/BILLS-119hr1eas.pdf https://www.congress.gov/119/bills/hr1/BILLS-119hr1eas.pdf Original article about Section 174 tax code causing layoffs https://news.ycombinator.com/item?id=44180533 https://news.ycombinator.com/item?id=44180533 Post from @dang with more info about Section 174 https://news.ycombinator.com/item?id=44226145 https://news.ycombinator.com/item?id=44226145
- mjoin 1y agoThat's nuts
- deleted 1y ago[deleted]
- tareqak 1y agoPage 301 > there shall allowed as a deduction any domestic research and experimental expenditures which are paid or incurred by the taxpayer in the current taxable year AFAIK, there was no domestic vs. foreign R&D distinction in section 174 before.
- Thorrez 1y agoThere was a domestic vs foreign distinction in the TCJA, passed in 2017, which took effect in 2022: > 174 to require taxpayers to amortize specified R&E expenditures ratably over a five-year period for domestic expenditures and a 15-year period for specified R&E expenditures attributed to foreign research https://www.journalofaccountancy.com/issues/2022/nov/amortizing-r-e-expenditures-under-tcja/ https://www.journalofaccountancy.com/issues/2022/nov/amortiz...
- Thorrez 1y ago>It also classifies software development as R&D The TCJA (passed in 2017) already did that (effective 2022). So it sounds like this new bill is keeping that, but changing the deduction rules back to what they were before 2022. See this previous discussion of the TCJA: > all "software development" is now an R&E expense. https://news.ycombinator.com/item?id=34627712 https://news.ycombinator.com/item?id=34627712 (AIUI, "R&D" (research and development) and "R&E" (research and experimentation) are synonyms.)
- tomrod 1y agoIf correct, this is a good thing on a generally bad, overstuffed bill. Immediate expensing never should have been changed in the first place, and it was always weird seeing people twist themselves in knots defending it.
- xp84 1y agoIt’s an overstuffed bill because nobody will compromise on anything so the only way to pass a bill that has anything even remotely controversial to either party is one reconciliation bill a year.
- dragonwriter 1y ago> It’s an overstuffed bill because nobody will compromise on anything so the only way to pass a bill that has anything even remotely controversial to either party is one reconciliation bill a year. No, and lots of controversial bills have passed other than as reconciliation bills, and especially so during trifectas where they "controversial" within the minority party but broadly supported by the majority; reconciliation is necessary to pass something that strains unity in the majority party and is uniformly opposed by (not "controversial to") the minority party, perhaps.
- cheriot 1y agoIn the last 10 years, have there been more than a handful of bills that got 60 votes in the senate? I wouldn't like what the current congress would do without the filibuster, but at this point a paralyzed system might be worse.
- apsec112 1y ago"Despite Democrats holding thin majorities in both chambers during a period of intense political polarization, the 117th Congress (2021-2023) oversaw the passage of numerous significant bills, including the Inflation Reduction Act, American Rescue Plan Act, Infrastructure Investment and Jobs Act, Postal Service Reform Act, Bipartisan Safer Communities Act, CHIPS and Science Act, Honoring Our PACT Act, Electoral Count Reform and Presidential Transition Improvement Act, and Respect for Marriage Act." All of these except the first two were bipartisan and got 60 Senate votes (or more)
- lsllc 1y agoLooks like prior years can be caught up with: > Companies with capitalized domestic R&D expenses from 2022–2024 can elect a catch-up deduction, which could significantly improve cash flow for firms engaged in innovation.
- umeshunni 1y agoThe 2nd most annoying thing about section 174 was all the time you had to spend classifying each engineer's time spent as R&D or 'internal software'. At my last company, every year, me and my engineering lead counterparts would spent almost a day reviewing each engineer's JIRA tickets to reconstruct how much of their time was spent on R&D vs internal software.
- supriyo-biswas 1y agoAt a previous employer, they used to have this process where they would classify each project as being in active development or being in maintenance, and even the tiniest bit of development work required the "initiation" of a "project" with budget planning and approvals. At the time I dismissed it as a bureaucratic process invented by the company; after all, they had no dearth of leaders adding bureaucracy to systems for the purpose of empire-building and, to a lesser extent, asserting self-importance. However, upon reading about Section 174, it made some sense, and I wonder whether they might just get around to removing these processes.
- viraptor 1y ago> and even the tiniest of development work required the "initiation" of a "project" with budget planning and approvals. That's fully automateable though, right? Sounds like my script to upload a PR, create a JIRA ticket with the same name, link them up, auto-Done on merge.
- samrus 1y agoYou cant automate the tactical assessment of "do we want to incur this tax?" Not easily anyway
- viraptor 1y agoI meant most of the process and boilerplate being automated. Someone still has to go through the rubberstamping process, but at least the BS and clicks can come from the BS and clicks generator.
- johncole 1y agoI think we will see this lead to a boost in software developer employment.
- lsllc 1y agoMight even ameliorate some of the corporate RTO efforts and now s/w devs will have more employment choice and a presumably more vibrant job market.
- Spartan-S63 1y agoI’m hoping so, too, along with another boost in salary growth since they’re immediately expensable.
- mlinhares 1y agoI doubt it, the narrative is that software engineering is dead and everything will be replaced by AI, so that salaries can continue to be depressed. Just like the original passing didn't really cause much trouble in the general market this repeal will mostly just produce more shareholder value.
- x3n0ph3n3 1y agoIt's always been a nonsense narrative with lack of grounding in reality.
- seattle_spring 1y agoAnyone who knows anything about software and has used AI for more than 24 hours knows that AI won't be "replacing" software engineering anytime soon.
- ldjkfkdsjnv 1y agoive been coding 5+ hours a day almost every day for 15 years. i think ai will replace 70% of SWE in the near future. not employement, but 70% of the current work done by engineers
- dhosek 1y ago[flagged]
- fascist12345 1y ago[dead]
- greenail 1y agothis doesn't add anything to the conversation.
- qotgalaxy 1y ago[dead]
- justahuman74 1y agoYou must see the irony in saying this given what the parent comment has.
- agwa 1y agoAs a small software business owner, I have to agree with Michele Hansen (who spent 2 years advocating on behalf of small software businesses for this very change): "we’re finally going to get Section 174 relief, and I couldn’t be angrier" https://www.linkedin.com/posts/mjwhansen_it-looks-like-were-finally-going-to-get-activity-7340500201834430464-GjYP https://www.linkedin.com/posts/mjwhansen_it-looks-like-were-...
- yieldcrv 1y agoI disagree, every rider was independently lobbied for and the outcome would be the same if passed separately by Congress or as a rider in a larger bill like it was. There is no reason to have cognitive dissonance over it.
- acheron 1y agoIt proves they never actually cared in the first place, it’s just arguments as soldiers.
- edaemon 1y agoIf every rider was independently proposed the outcome wouldn't be the same, reconciliation wouldn't apply and 60 Senate votes would be required to pass them.
- yieldcrv 1y agodecent point two counteracting forces: The senate parliamentarian decided they could be in the reconciliation bill and outside of the reconciliation bill, believe it or not, Congress does pass other bills over the 60 senate vote threshold This R&D one would be a decent candidate
- AnthonyMouse 1y agoIf you have a huge omnibus bill that has a good thing that the representative's constituents want, and then a mountain of burning trash attached to it, and the representative votes for the bill, they can defend the vote as getting the thing their constituents wanted. If you make them each a different bill and then the constituents want to know why they voted in favor of the hot garbage by itself, how can they answer?
- ttul 1y agoMeanwhile, in Canada, not only can you expense R&D, but there is a cashable tax refund that will give you back about 60% of your developers’ salaries…
- sMarsIntruder 1y agoI hate to see this, but you’re comparing two completely different systems. Like it or not, but Canada is much more “socialist”, you can’t expect it in any case to be like US or viceversa.
- whatshisface 1y agoI saw a chart that added the market value of government support to income for US persons, and it used the term "household resources." I'd like to see a table of household resource distributions for Canada and the US.
- cbsmith 1y agoCanada is "much more socialist" in that it has socialized medical insurance. Aside from that, it's maybe a tiny bit more socialist, though one could argue it's not more socialist at all. The systems are different, but saying they are completely different is really a stretch. There's a GST that the US doesn't have, which is, ironically, a regressive tax. If you ranked the tax code of countries by similarity to the US tax code, I'm not sure Canada would be at the top of the list, but it wouldn't be that far down.
- llm_nerd 1y agoCanada is much more socialist, in your take, so it has more programs for corporations and private enterprise? Huh? This is nonsensical. Further, it's incredibly difficult to quantify countries on this purported socialism scale. Sure, Canada has universal healthcare like every single developed country but the US, but otherwise it's much more of a mixed bag. The US has always been vastly more "socialist" than its advocates think -- the military is a colossal make work project and is straight out of Soviet doctrine for central planning -- and of course the entire agricultural industry exists under a massive subsidization regime, but under the current administration....whoa.... There is no Western country that has a central planned economy, with a president that is taking direct control of corporations (US Steel) and demanding ownership of corporations (TikTok), while enlisting private executives as members of the military exactly like China (https://www.theguardian.com/technology/2025/jun/25/meta-exec-us-army-enlistment https://www.theguardian.com/technology/2025/jun/25/meta-exec...), all while saying the entire economy is a "store" that he has sole control over. Absolutely no one in the US, looking very Stalinesque ala the late 1930s, should be throwing stones about socialism.
- jofzar 1y agoSo this is going to get all those jobs back that people have been layed off for right? Right?
- coliveira 1y agoOf course not.
- supportengineer 1y agoReversion to the mean
- nine_k 1y agoHiring software engineers is going to become less expensive. So likely there's going to be more jobs on the market, and maybe better jobs. But when a forest is cut, usually a new forest that grows on that place looks different.
- 0xbadcafebee 1y agoThe elimination of green energy incentives is going to have a big negative effect on the economy. Those billions of dollars not only were going to new businesses and jobs, but they were joined with loans from banks and commitments from customers with the expectation that the government would be funding the remainder. This means private industry and banks will be shouldering the loss of hundreds of billions of dollars, which, as any astute person should know by now, later gets shouldered by the average citizen in rate hikes, stock market plunges, increased inflation, etc. There goes your job and 401k and here comes more expensive products. Aside from the direct negative effects: we lose even more to foreign countries who now have even more runway to gain expertise in green energy and sell to everyone else investing in it. Nobody but the 3rd world is increasing investments in coal/oil and there's no money we could make there anyway. So there goes any money we could've made on energy internationally. Either this country is intentionally being tanked, or we're in the stupidest timeline.
- sp527 1y agoAny green energy project that isn't nuclear is a waste of money and resources. Nuclear is now being pursued in earnest by the tech industry itself. There's no problem here.
- cheema33 1y ago> Any green energy project that isn't nuclear is a waste of money and resources. Nuclear's cost/megawatt is significantly higher than most other options. If anybody is reaching for nuclear it is because they are using up all available capacity through other means. Nobody picks nuclear for cost reasons.
- AnthonyMouse 1y agoData centers are a pretty good match for nuclear because they run 24/7 and use a fairly constant amount of power. Solar is cheap in terms of amortized price per kWh but then you need some other solution to supply power at night or when it's cloudy, and the price of that has to be paid on top of the cost of solar. Meanwhile nuclear costs what it does in significant part because the number of new plants is low which requires the cost of designing new reactors etc. to be amortized over fewer plants. But if you build more of them that changes.
- nashashmi 1y agoThis was the expense that was removed in the first Trump tax bill. Amazing how it takes another super tax bill just to get it through
- root_axis 1y agoI believe the impact of Section 174 has been vastly overstated, sadly we will soon observe this to be the case.
- doctorpangloss 1y agoWell who the hell was complying anyway?
- BobbyJo 1y agoWhat do you base that belief on?
- autobodie 1y agoI would assume they think the cause of the layoffs was more related to the non-zero interest rate.
- cheema33 1y agoNobody at my work knew anything about it. And we do have software engineers. I suspect only the very large orgs with expensive accountants were complying. And pay now vs later thing didn't really matter that much to them anyway.
- greenchair 1y agoyep it is definitely a big deal for f500. lots of creative accounting techniques had to be used in the meantime.
- me551ah 1y agoI doubt if this will make much difference. Offshoring as a tactic emerged in the pandemic when companies realised that being “remote” works just as well. Sure, foreign R&D still gets amortized over 15 years (NPV ≈59 % of a full write-off, so you “lose” ~8.6 % of your R&D spend in present-value terms, and only 6.7 % of the cost is deductible in year 1, creating a 19.6 % cash-tax gap). But offshore wages are often 50–70 % below U.S. rates: • Even after the slower amortization drag, hiring at half the cost nets you ~30 % total savings on R&D headcount. • On a pure cash basis you only need ~20 % lower wages to break even; most offshore markets easily exceed that. • So the labor-cost arbitrage far outweighs the tax timing penalty unless your foreign salaries are less than ~20 % below U.S. levels. In short: the 15-year amort rule hurts your tax deduction, but 50 %+ lower offshore wages more than make up for it.
- BobbyJo 1y agoThis ignores the other financial and non-financial costs of offshoring: legal, cultural, temporal... a lot of the time, those close the gap. On paper, offshoring has made sense the entire time, and yet here we are in 2025 and companies still hire American devs. Not only that, they often fly in foreign devs just to pay them more here than if they had just offshored to their home country.
- __loam 1y agoYeah people have been offshoring then onshoring once they realize offshoring sucks since at least the 90s. I remember my dad, who was also a software dev, complaining about it 20 years ago. It always swings back. The network effect in huge hubs like SF and NYC is massive.
- BobbyJo 1y ago100%. Most of the planet is cheaper than the US, and has been for decades. That being the case, how are there so many knowledge workers here still?
- 1y ago
- xvector 1y agoThank jeebus.
- archagon 1y agoOh, goody! Also, ICE has a bigger budget now than most of the world's militaries[1]. But let's not talk about that. [1]: https://www.newsweek.com/immigration-ice-bill-trump-2093456 https://www.newsweek.com/immigration-ice-bill-trump-2093456
- saubeidl 1y agoAn organization of goons who grab people off the street and disappear them to concentration camps? Why does that sound so familiar? Capitalists have always been involved in the rise of fascist movements.
- drstewart 1y ago>Why does that sound so familiar? Probably because you've seen it repeated so much in your hyper-propaganda bubble of reddit that you've started to believe it
- saubeidl 1y agoI am Austrian. My entire education was dedicated to the rise of fascism and how it could happen and how to make sure it never happens again. I know what I'm seeing. Don't believe me? What about subject matter experts that decided to flee the country? https://www.nytimes.com/2025/05/14/opinion/yale-canada-fascism.html https://www.nytimes.com/2025/05/14/opinion/yale-canada-fasci... Or how about an excerpt from a book written based on post-WW2 interviews of Germans? Does any of that sound familiar at all? https://press.uchicago.edu/Misc/Chicago/511928.htm https://press.uchicago.edu/Misc/Chicago/511928.htm > They say, ‘It’s not so bad’ or ‘You’re seeing things’ or ‘You’re an alarmist.’ [...] > "But the one great shocking occasion, when tens or hundreds or thousands will join with you, never comes. That’s the difficulty. If the last and worst act of the whole regime had come immediately after the first and smallest, thousands, yes, millions would have been sufficiently shocked—if, let us say, the gassing of the Jews in ’43 had come immediately after the ‘German Firm’ stickers on the windows of non-Jewish shops in ’33. But of course this isn’t the way it happens. In between come all the hundreds of little steps, some of them imperceptible, each of them preparing you not to be shocked by the next. Step C is not so much worse than Step B, and, if you did not make a stand at Step B, why should you at Step C? And so on to Step D.
- charlieyu1 1y agoThis bill is so random. The poker world is going doom and gloom when BBB limits the amount of gambling loss deductibles to 90% of gambling wins.
- phtrivier 1y agoRemember when we software engineers painfully learned to _not_ do massive releases with hundred of changes that are guaranteed to create bugs ? Well, imagine if instead we were _incentivized_ to create lots of bugs in huge releases, because it helped us ship that one important feature that the PM wanted in the middle of the garbage - and also, that we were guaranteed never to have to debug the software ever, and god forbid, to use it ?
- CraigJPerry 1y agoCould this transfer enough money to mint a person as the first trillionaire? Econ 101: A government deficit increases the net financial worth of the private sector. The US usually increases the net financial worth of the private sector by around $2tn per year, OBBB should move that to around $3tn per year (CBO estimate https://www.cbo.gov/publication/61486 https://www.cbo.gov/publication/61486) If you accumulate a dollar per second in net worth, then you become: A millionaire in 11 days A billionaire in 32 years A trillionaire in 32,000 years Obviously an indiscriminate increase in money without a corresponding increase in output will show up in inflation. So it's a wealth transfer, from those whose financial affairs will remain comparatively static (your dollar will be worth less via inflation) to those who can capture the new money streams.
- phtrivier 1y agoIt was floated a few weeks ago they this tax break's disappearance was responsible for mass lay offs in tech. Other theory were AI and interest rates. I'm pretty sure next rounds of layoffs will have another "good reason". Personally, I'm still partial to my pet and hard to document theory of "when headcounts go down, share prices go up - and past a certain size and age, the goal of a massive corporation is not to build things any more, but to pay for retirements through the resale / buybacks of shares" But, hey, BBB is singed, so everything will be awesome soon, I suppose ?
- empathy_m 1y agoHey hey, maybe it will help job stability. Gergely Orosz, whose writing is influential in tech spheres and fun to read, has been a loud proponent of the theory that TCJA's elimination of the immediate expense of R&D research cost was the skeleton key explaining technology sector layoffs. It seems to me to that many technology-industry trends are driven by vibes: * People seem to love reading articles in any kind of media source about their company's products and are remarkably credulous of them / influenced by their content. Not just PR generating roundup reports of media coverage, this is also engineers and leaders who follow any coverage of their firms quite closely. * There really does seem to be a sort of contagion effect with layoffs where, once one firm began doing it, everyone did (layoffs.fyi has a lot of data supporting this kind of hypothesis) * Among founders and engineering leaders, there does seem to be a common set of ideas - not just the group-chat consensus that helped kill SVB, but just an overall whisper network of facts that everyone knows is true - which guide their choices. Overall it seems reasonable for software-industry employees to hope a narrative takes hold like "we had to lay off lots of people because their headcount didn't pencil out during the annual FP&A cycle under the new TCJA R&D rules, but now that the new law has restored immediate R&D expensing the formula is going to make the opaque headcount number higher, and jobs will be more stable". The idea might even become true if enough people believe it. Personally I think the layoffs are better explained by another phenomenon, superpersuasion from AI. (My niche view is that the first superpersuader success story was when the chatbots convinced business leaders to reallocate resources to buying more GPUs and LLM tokens and lower investment in the rest of their lines of business.)
- grumple 1y ago
- rendaw 1y agoThere's something I didn't get about the discourse about this, maybe someone can explain. The tax change greatly affected small businesses/startups with unstable revenue, right? But companies like Amazon, Google, etc are much more established companies with diversivied, stable revenue and longer term planning I'd assume - so it doesn't seem like this should have affected them as much. The popular story currently is that the massive layoffs were due to the tax/accounting change, but in that case why the big players like Amazon etc have so many layoffs? Or is that the popular story because, while Amazon etc are large, by total employee count most people are employed at smaller business that were more affected by this? Or was the FAANG stuff actually AI after all? The tax change story sounds more plausible to me but I can't connect everything.
- pm90 1y agoIts a combination of factors. The end of ZIRP made raising money more expensive and the tax change made hiring Software Engineers more expensive. Small businesses faced existential challenges and cut back, so now there was less demand from them. Then Big Tech realized they needed to layoff to post better numbers to continue boosting their stock (even though they made enough revenue) so started cutting jobs. With this change one of those factors has been eliminated, so we will see startups/small businesses become a lot more competitive.
- pavlov 1y agoIs there a more bizarre legislative process anywhere in the world? The US Congress is practically able to pass only a single giant bill every year. To work around its own deficit rules, these bills are packed with taxation time bombs where rules have expiration dates or delayed starts several years in the future. Then, if Congress doesn’t get around to defusing its own time bombs, you get situations like this R&D expensing fiasco where American businesses and employees pay the price. Unless the bomb is hopefully retroactively cancelled, like happened now. On top of this madness, there’s an executive branch operating like a runaway autocracy, producing a flood of executive orders that intentionally flaunt laws and even target specific private entities (e.g. Trump’s attacks on law firms that worked for his opponents, and universities he doesn’t like). How long can a nation function like this? If the bond market loses faith in this process, there could be mayhem. Will be interesting to see if the passage of BBB impacts US debt when markets open again on Monday.
- kevin_thibedeau 1y agoCongress has transformed from a body of civil servants working toward a common goal to a bunch of solipsist narcissists happy to burn everything down for more face time in the beltway media echo chamber.
- kzrdude 1y agoIt's a year of very rapid change. I just realized the other week (naively) that we (non-US) should really be bracing even more than we are. For shocks to come, economical, cultural as a reaction to the slide towards an authoritarian presidential system. It's not a time to be watching though, but to act.
- jayd16 1y agoThe unserious and corrupt are consistently rewarded with re-election. I really have no idea how we move forward.
- Sammi 1y agoGet rid of the First Past the Post voting system. Almost all the brokenness of US politics is downstream from FPTP. It incentivates divisiveness instead of collaboration and consensus, which a better voting system would.
- bgnn 1y agoSo US will continue subsidizing its R&D while complaining the rest of the world is doing so? What changed then?
- bongodongobob 1y agoIf you're going to subsidize anything why wouldn't it be R&D
- bgnn 1y agoThere's nothing inherently wrong with it. Though it creates a competitive advantage and forces other countries to do the same, of not more. Everyone starts pointing fingers at each other and imposing tariff at the end. Plus this puts pressure on manufacturing, as they will not be able to compete. So yeah, as a tool to boost knowledge economy it works but is it objectively a good thing to do I don't know.
- aaronblohowiak 1y agowhy wouldn't r&d count as an expense? why do amortization schedules constitute a subsidy?
- Spivak 1y agoOur glorious R&D subsidies, their savage market manipulation.
- trollbridge 1y agoIt’s not a subsidy. They just are letting people immediately expense R&D instead of requiring it spread over 5 years.
- TacticalCoder 1y ago[dead]
- bjoli 1y agoI'm not really that into US politics, but to me this bill seems like a gargantuan transfer of wealth to already wealthy people. How does this land with the people who voted for Trump outside of the traditional republicans? Can they finance it without raising the debt ceiling?
- ksec 1y agoMay be a Naive Question: Has there ever been a time, where Tech or Software companies have to pay tax even when they are un-profitable. And if not, given the historic low interest rate, why not borrow and continue to grow until the company can no longer manage to spend all your debt? Correct me if I am wrong I think that used to be the playbook for Amazon. There are companies which I dont understand why they are keeping all the profits and not reinvesting for R&D or other purposes. I must be missing an angle on this. Apart from investors, what else would it be?
- rwallace 1y agoLooking through the latest 'Who's Hiring' thread last week, I noticed that a higher percentage of the remote jobs seemed to specify Remote (US). Could one of the causes of that, have been employers reading ahead and making decisions on the basis that this bill might be passed? Or is there some other reason? Or is it just a case where it fluctuates randomly from month to month, and I am trying to read pattern into random noise?
- deleted 1y ago[deleted]