President-elect Barack Obama could do a great deal of good when it comes to emphasizing the important role that technological advances play in our economy.
One such example would be to ask his party leaders in Congress to do more than merely pay lip service to the importance of the research and experimentation tax credit and to pass an improved permanent credit. Last year the credit was allowed to lapse, and in October of this year it was retroactively applied, sapping much of its value to tax planners, hence reducing the encouragement to companies to invest in ever increased amounts of research in this country. The credit must be made permanent.
Similarly, an Obama administration could score another easy victory by calling on Congress to repeal the Spanish-American War tax, the 3 percent excise tax on telephone calls that has never quite died, even 110 years later. While the Bush administration decided to no longer collect the tax, Congress never actually repealed it. That means that with a stroke of a pen the tax could be put right back in place. Not only has the Spanish-American War been paid for, this sort of tax reflects antiquated thinking about the communications marketplace.
As a general proposition the tax code is a 100-year-old mess of special deals for agriculture and manufacturing. Retooling the tax code to establish a level playing field would at least acknowledge that information technology, bio, and other cutting-edge industries deserve equal treatment with other critical industries.
The new administration could also help demonstrate that it understands the importance of the knowledge economy by reversing the multiyear slide of visible technology positions in the administration. Most recently, the Bush administration eliminated the Office of Technology Administration, part of the Department of Commerce. The office’s goal was “to maximize technology’s contribution to economic growth, high-wage job creation, and the social well being of the United States.”
Bush also closed of the Congressional Office of Technology Assessment and shuttered the President’s Information Technology Advisory Committee.
Simply put, a President Obama could become the pro-tech president. If he really wants a “change” from Bush policies, technology is a good place to start.