Not long ago, I was discussing with an acquaintance the need for businesses to constantly upgrade and innovate, and eventually our conversation worked its way into the challenges of intellectual property theft from China, and job creation here at home. Indeed, they asked a very interesting question, and offered it up as a potential solution too. They asked:
“What about bank loans to pay for short term R&D?”
Fine, but it gets back to risk/reward, loans have to be paid back. I can recall once wanting to give a series of ideas to DARPA, and instead of getting to talk to anyone, I was sent to a webpage to the SBA, and instructed I could get a loan to fund my research and business? Ridiculous, first one has to know if anyone is interested in buying, if you create it, and then you’d be competing with the big boys for procurement.
Which means it could cost $500,000 once you have all the research done just to win the bid, and when you solicit the government, they need at least two bidders and they put all your specs and knowledge into the solicitation for bid and send it to your competitor, who is a big boy, with big bucks who will get the contract anyway. The big industry players have all the right connections, lobbyists, etc. and remember you still have to pay back those loans, how can you win? You can’t, so, why play, it’s just BS.
And if you come up with a new invention and produce it, the Chinese steal it, mass produce it cheaper, and sell it to your intended customers, so why pay for the R and D or borrow money just to have it stolen? It’s BS, but apparently, no one in authority gets it. Meanwhile we fund with taxpayer’s money research, let’s say solar, and then our University graduate students write a paper, and speak at a conference to present their idea, some German, Japanese, or Chinese company takes it, makes it, and sells it back to us.
Thus, the taxpayer’s funded Chinese, Japanese, or German companies who then make US company technology obsolete and those jobs are gone. We’ve lost 42,000 US factories since 2001 and 5.5 million jobs since 2000.