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