I try not to be too political here. Most of my politically-oriented posts tend towards science and disease related public policy, but like most Americans I’ve been thinking about the upcoming Presidential election. And specifically, this week I’ve been thinking about Mitt Romney’s now-famous remarks about how many people in the country don’t pay income taxes and what that means about and for America:

“There are 47 percent who are with him, who are dependent upon government, who believe that they are victims, who believe that government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it.”

And then today I had a realization.

In 2011, I did not pay any income tax.

In 2010, I did not pay any income tax.

For 40 weeks, from the summer of 2009 until the spring of 2010, my sole income was from unemployment.

I hadn’t figured it out before, but apparently, I am a victim. I am what’s wrong with America. I apparently feel entitled to a lot of things that I’ve been mistakenly paying for with my own money.


Here’s two stories.

In the first one, a small biotech received an SBIR (Small Business Innovation Research) grant for about $150,000. That grant funded a project that turned into a program that funded probably 75 jobs for over a decade (including mine, which I had for six years). A couple of years ago, that program was licensed to a big pharma company for what could end up being hundreds of millions of dollars. That program also created a drug that is now in late phase clinical trials, which represents the first new medicine in >25 years for women with endometriosis. That seems like a pretty good return on a six-figure investment if you’re society.

Here’s the other one. In late 2009, a couple of friends and I decided to start our own biotech company. We had been laid off the summer before and had been working since then to get everything we needed together. We got our first funding in early 2010 with — you guessed it — an SBIR grant. Until then, we’d been collecting unemployment. And I can tell you, without the cushion of unemployment, we wouldn’t have been able to get our company off the ground.

In 2010, we founders took no salary and used the money saved from that to hire another scientist (at full salary). Because of that, I paid no income tax. I didn’t have an income and we were trying to turn the SBIR grant money into something durable and successful like we’d done at our previous company. We were awarded a couple of other grants and in 2011, we founders started taking a little salary. And we paid all the payroll taxes and for healthcare, but by the end of the year, it wasn’t enough to have to pay income tax.

In 2012, we continued to do a little better, even finding a trickle of non-grant income. With that were then able to hire two more scientists. And we founders have even been able to pay ourselves a little more. And that’s where we are. We’ve gone from nothing to six people in less than three years. We’ve got some programs that might turn into something really good. Will we ultimately be successful? I don’t know, but I hope so.

My point is that our small business, and the technology jobs that we’ve created (not to mention the many jobs that grew out of that previous effort), has been dependent on federal government investment* and social net support (unemployment) for its foundation and early creation. So I suppose in today’s vernacular, you’d be correct to say “I didn’t build that”. But I am grateful to live in a society that supports a framework such that enterprises like ours have a shot at giving a good return on that investment. I like to think that’s good for our society.


“These are people who pay no income tax; 47 percent of Americans pay no income tax. So our message of low taxes doesn’t connect… And so my job is not to worry about those people. I’ll never convince them they should take personal responsibility and care for their lives.”

Governor Romney and those that support this rhetoric may lump me in with the deadbeats and the takers and feel that by not paying income taxes I am “not taking responsibility and care” for my life, and believe me, I’ll be more than happy to pay my income taxes when I can pay myself enough. I hope that comes this year. But what I hope more than anything is that a project we’ve started working on now might in another decade or so, become a medicine that helps cure someone’s loved one, regardless of whether they had an Obama or Romney sticker on their bumper way back in 2012.

*the life cycle of drug research is so long (10 years or more) that “traditional” funding is scarce until you’re far along


30 thoughts on “Taker

  1. Wow. I never knew this about you! So cool! (The small business thing, not the 47% thing. Although I probably am a 47%-er, so I didn’t mean that negatively. Parenthetical speaking is haaaard.)

  2. I think it is great your company is doing so well. Go you!

    The year I got laid off most recently, I got a lump sum severance payment in November, so on my income taxes, it looked like I’d had an awesome year, and my husband and I got hit with the AMT. I had landed a new job the month before, so we were able to pay and only grumbled a little at the ridiculousness of it.

    But I also collected unemployment while I was out of work. And of course, I used California’s paid family leave when I had my kids (as did my husband). Technically, I paid into that, but it is a government program and I often hear it bandied about as one of the things that makes California “bad” for businesses.

    So I’m not sure where that puts us in Romney’s classification scheme!

    • Cloud — I think everyone realizes that when you have policies to govern > 300,000,000 people, there are going to be some ragged edges. I got smacked with the same thing b/c of my severance, and you’re like “really?”…

      I will say that as a small business owner (wow, that sounds weird) I have been appalled at the rate of increase of health insurance. Holy crap. That’s killing our budget and probably keeps us from expanding a little more.

  3. You’re a really talented guy Steve and I think it was fortunate the government is here for innovations. The GOP made me laugh; they talked about their distant relatives clawing themselves out of poverty. Not themselves, not even their parents. They were born with a free handout in their mouths and now they’re whining that other people want a small amount of help. What the hell.

    They also forgot to mention that not all of us dream of dollar signs. To some of us, leaving our workplace better than we found it is important. Giving to others (nurses, teachers, animal caregivers, social workers) trumps the wealth they’ll never have. Much of their generosity actually saves the government money. I guess Romney considers them just a bunch of leeches.

    • Thanks Amelie — I never begrudge anyone honestly-earned wealth, even that which is inherited. But man, I can’t take the faux populism in which every pol tries to sound like they were born in a log cabin.

      One thing I learned early in my career was that employees were motivated by all sorts of things: whether it was money, or title, or the number of people that reported to them. And some people just take pride in a job well done and don’t worry about getting up the ladder.

  4. I had a year where I paid no income tax. In one day, CBS Radio laid-off 180+ people, and I was one of the many fired at my station. (We went automated). Unemployment covered my rent and my COBRA. Beyond that, I was living off my 401(k). I was living small, to say the least.

    I firmly believe Romney’s rhetoric is more racism than anything: “These non-white welfare people are just taking and taking.”
    I’m very much pro-science, and pro-research. If some companies hadn’t spent millions of dollars developing various meds, I’d have been dead three times over.

    I admire your tenacity. You talk about “clinical trials,” but I know you’re really plotting how to overthrow the government with your seagull/shark hybrid army. When you come to power, I’d be happy to be your goon (like Leo McGarry, only more behind the scenes, and less tie-wearing). ;-)

    • I’ve had my “47%” conversation with others that are more conservative and their response has been, “Well clearly he didn’t mean YOU. You’re WORKING and TRYING. Not like the others that are taking advantage of the system…” Like voter fraud, I think there’s a lot fewer scammers than they’d like to believe.

      That’s when I usually sick the sharkgulls on them.

  5. wonderful and smart post – when you lump people together under one heading that is your first mistake, then when you write them off, that is your second mistake–he will not come back from this (I am Canadian so I have no vote in this — but if I did have a vote–this is exactly where I would have made my decision)

    • Thanks Homefront — I guess what got me was the almost automatic lumping of half the country into “them”. How can a politician even do that? I mean, if he’d said “47% of Americans don’t pay income tax, that seems out of balance, we need to take a hard look at our tax code and make sure we’re getting the right revenue from the right people” or something like that, I might have listened to him, but of course, he didn’t.

  6. You didn’t build that, that wasn’t you:) Romney Vs. Obama an election where a majority of the voters will be voting for a candidate that they don’t like because they don’t like the other guy more. Doesn’t look good for the home team.

    • There haven’t been too many elections that I can remember a candidate mostly touting their own vision than bashing the other guy. Obama in ’08. Clinton in ’92 maybe. That might be it.

  7. Something tells me you are not the only “victim” with a story like this to tell. And I also think people like you…being creative and innovative… showed up in Romney’s staff research. They just didn’t include these stats…that would mean being honest, which is a lost cause for Romney as far as I’m concerned.

    I wish you, your other founders and all your staff huge, fat paychecks next year…with the appropriate taxes files, of course. :)

    • Thanks BD — I think it’s like the voter fraud ridiculousness. They want you to believe that there’s a lot more of it (and be appalled by the idea of it) than there actually is. You take away folks that earn money, but not enough to pay Income Tax, the elderly, the military and suddenly that number gets pretty small…

  8. My main client is an SBIR company too, and I know the difficulties of running an SBIR company – I am never sure I would get paid any year until I see the check.
    But as you said, it is good that you live in a country that supports such ventures. Any progress made by society rests on such ventures.
    Good luck.

    • Thanks LG! If you’d have asked me whether we’d survive more than 2 years, I’m not sure what odds I would have given you. And here we are getting ready to complete year 3 and embark on 4!!

  9. Pingback: Ryan May Have Gone all Pinko on Us - The Omnipotent Poobah Speaks!

  10. I am shocked, shocked to hear a politician speaking in polarizing generalities. Hopefully there will be no more of this from either campaign.

    P. S. Steve, I think I left the sharkgull cage open last night. Hope that’s ok!

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