Your Taxes as an Investment

Posted on 1st August 2004 by Ryan Somma in Enlightenment Warrior

Two and a half blocks down the street from my house stands a monument to the irrational enterprising spirit, the Old Dominion University Maglev train. “Maglev” is short for “Magnetic Levitation”. This is a train that would float on a cushion of air a half-inch thick above the track, shuttling students across campus. It would be doing this, that is, if the technology worked.

It was supposed to be running in Spring of 2001, now it just sits, abandoned, but I am not looking to criticize the spirit of invention and idealism that prompted the University’s attempt at this endeavor. Nor am I critical of the project’s cost, $16 million. $7 million of which came from private enterprise, $7 million from Virginia taxpayers, and $2 million from Federal taxpayers. This is money lost, and barring a “Eureka!” breakthrough on the part of American Maglev Technology, the company working on it, this project will never succeed. Unfortunate, but that is not what bothers me.

What’s irking me is what if it had worked?

If, by some miracle, American Maglev had managed to stabilize the magnetic fields sufficiently to make the train a safe and enjoyable ride, they would have become billionaires. The technology would sweep across the country like wildfire, revolutionizing mass-transportation systems throughout America.

What would the taxpayers get? The $9 Million dollar loan paid back, with interest.

Hardly seems fair. We call the money a loan, but if the business venture fails, we’re hung out to dry. No bank would ever take such a risk. It’s not a loan, its Venture Capital, and it’s ours.

It happens all the time. Dr. Amar Bose, a professor at MIT, developed revolutionary enhancements to sound systems thanks to Government Grants. He then patents his inventions and starts the corporation Bose, making millions. Pharmaceutical companies receive billions of dollars in Federal research funding to invent life-saving medicines, so they can charge astronomical prices for pills that patients will die without.

If you went to an investor and asked them to invest in your product solely for the privilege of letting them use the product at an overblown price. They would laugh you out of the room. The taxpayer is an investor who puts up capital for such a ridiculous return.

Our tax money goes into research and invention that would not be done otherwise, because the cost is too high. These inventions we create are then used against us. We become slaves to phone monopolies, Microsofts, pharmaceutical companies who charge extravagant prices for things we cannot live without. Then these same companies hide in tax shelters, lobby for tax cuts, and argue for corporate welfare.

I am not proposing government seizure of these inventions. To do so would squelsh research and innovation. Inventors should reap potentially fantastic rewards for their hard work to inspire other. Some Universities take a 50% cut of the profits earned on their Professor’s inventions. Perhaps the Government, State and Federal, should do something similar. Say perhaps a 10% cut of profits for our Capital Investment, which would be dedicated to funding future research?

One Bose could make up for many American Maglevs that way.

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