Re: Proposal for Small Business IP program to create jobs

In article <Xns9CDE184CB816jyaniklocalnetcom@xxxxxxxxxxxx>,
jyanik@xxxxxxxxx says...
Mark Borgerson <mborgerson@xxxxxxxxxxx> wrote in
news:MPG.258b16e72b5dec8598999a@xxxxxxxxxxxxxxxxxxxxxxxxxx:

In article <hfr9ng$iq9$1@xxxxxxxxxxxxxxxxxxxxxxxxxx>, raymond-
ohara@xxxxxxxxxxx says...

"Frogwatch" <dbohara@xxxxxxxxxxxxxx> wrote in message
news:10b43b88-55cd-4a49-a322-0be0be79576b@xxxxxxxxxxxxxxxxxxxxxxxxxxxx
... I propose to use part of the returned TARP funds for a new
version of the Small Business Innovative Research (SBIR) program.
Under the SBIR program, every federal agency with a research budget
must give 3.5% of said research budget to the SBIR program. It is
intended to be for high risk, high payoff research that solves a govt
problem AND results in a commercial product. SBIR is the largest
source of start-up funding for such high risk research in the USA and
has been a success in spite of much abuse.
I propose a variation that unlike the SBIR that is a pure grant to
small business, will re-pay the govt funds. Basically, I propose to
make the Govt an =3Fangel=3F investor for small start-up business
ideas that are not yet patented but are protectable by patents. This
distinction over patents is necessary because I know from personal
experience that it is easy to cut the govt out of SBIR patent rights
by simply applying for the patent before writing he SBIR proposal.
Most of the funded projects will be failures and this si expected.
However, enough should be successful so the resulting patents can be
sold or licensed by the govt. Such sales would occurr after giving
the small business 7 years to develop the business resulting from the
patent (the patent would then have 14 years remaining)
Like the SBIR program, this would result in numerous small high
technology start-ups but it would be self sustaining because of the
revenue from the patents. It would only be available to businesses
with less than 25 employees. As the major component of the idea is
the resulting patent, proposal reviewers would have to be familiar
with patents and able to do a preliminary patent search to make sure
there was no prior art.
Like SBIR, it would be a 2 phase program. Phase I would bea
feasibility study and provisional patent application and would take
about 9 months and would be for about $100,000 (same as for current
SBIR Phase I). Phase II would be broken into 2 parts, more R&D and
then product development. The Phase II part could be up to 36 months
and might be for up to $1 million.
What would this cost? Well, 10,000 Phase I programs would cost $1
billion for the funding and probably another billiuon to administer
and would result in a minimum of 10,000 new jobs, very efficient by
federal job creation standards.

LOL! Reviewing 10,000 Phase I proposals probably requires 500 new
reviewers, so you can add those 500 jobs to the government payroll.


I assume that 30% of the Phase I
programs would go on to Phase II and this would cost $3,333,000,000
for the direct funding and double that for administration by the
government. We can safely assume that each of these $1 million
programs would employ 3 people too. IF you want to expand this
program, multiply by an appropriate amount.
This program will work because it actually produces something of
value that produces return on investment whereas most govt job
creation programs do not.
Thoughts?

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advocating socialism now Dave?



Mark Borgerson




what's the point of doling out TARP funds to small business start-ups if
the Government is just going to tax and regulate them to death?

the proposed healthcare tax and penalty provisions put a huge damper on
small businesses.Then just wait for the EPA regulating CO2 and
carbon(fossil fuels),and Obama wanting to raise gas prices to $10/gal.
(but slowly,so the frog doesn't hop out of the pot)

you won't see many new jobs created,nor current employers hiring,and you
will see more businesses closing or moving production to China.

The whole taxes vs jobs argument always puzzles me a bit. In every
company I've worked for, employee salaries and support costs have
been a pre-tax expense. Hiring someone new increases costs and provides
more deductible expenses---thus reducing taxes paid by the company. (Of
course, the hired individual will pay taxes from the salary.) It seems
the real argument is: "If you raise tax rates, my company will have to
cut costs to maintain current profitability levels and executive
bonuses." I suppose it is because Wall Street is allergic to reduced
profits, even if it means maintaining or increasing the number of
employees. That's probably not the reason for small businesses---most
of which are not exchange-traded corporations. The major problem
for small businesses isn't taxes---it's access to capital for expansion.
The big banks just aren't lending like they used to.


Mark Borgerson


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