[LINK] Budget

[Tom Koltai]

> -----Original Message-----
> From: link-bounces at mailman1.anu.edu.au 
> [mailto:link-bounces at mailman1.anu.edu.au] On Behalf Of 
> stephen at melbpc.org.au
> Sent: Friday, 15 May 2009 12:51 AM
> To: link at anu.edu.au
> Subject: [LINK] Budget
> 
> Although sympathetic to TomK's call for a return to local 
> manufacturing, I think we ought best leave much of that to 
> better-positioned countries.
> 
> Instead i think research is what we are good at and should be 
> our focus.
> 
> And, it would appear that Kevin&Co agree ..
> 
> --
> Science and unis are winners in the budget
> 
> Wednesday, 13 May 2009 Anna Salleh  ABC 
> http://www.abc.net.au/science/articles/2009/05/13/2569525.htm?

<Snip>

>Better positioned countries ?

Oooooo. I don't see that one working.
Scorecard:

Make 1, Sell 1. = 0 Budget Deficit.      People happy - low taxes.

Make 0, Buy 1 = 1 Budget Deficit.        People Sad. - high taxes.

Make 1, Sell 0 = 1 Deferred Budget Credit.  People sad - high taxes.

Regardless of where it was invented.

My response to the budget? For every dollar spent on education - 2
dollars need to be funding industrialization and 5 dollars need to be
spent on sales and marketing.

There is only one way to scale up GDP growth acceleration.
Industrialization. Borrowing money from overseas funders (read American
Dollars) to pay for consumer purchases sold for SDR's (not american
dollars) is financial suicide.
(One would hope that the Reserve Bank teaches Mr. Swann about SDR's.)

I don't care if we start by making candles. - Look at any country with a
rapidly growing national economy and you will see one single standout
factor: They make things. (Not mine things, not grow wheat - but actual
finished buyable articles).

Anyone that doubts this needs to consider the case of CSIRO -v- IT
Community - re 802.11.
We may have invented it, but we sure as hell didn't make any money from
it.
WIFI (802.11x) is considered to be worth globally 2.9 trillion dollars.

License fees being sought by CSIRO are how much ????? 
In other words, he that invents collects .00005%

I am fed up with academics that say "I've invented it - now someone
should pay me a huge amount of money." It's the single biggest reason
why Australia isn't a world leader on the IT stage.

VC's are unable to get their share of the pie and as a result don't
bother to fund.
When Academics and inventors realise that the inventor/s patent holder
is only 5-8% of the equation and the product realisation and sales is
the rest (which depends heavily on how much the Venture Capitalist
estimates he will make on the deal) then Australia will start to move
out of the consumption only mode that it has currently semi-retired too.

Giving money to Academics is Good.
Manufacturing the invention in country is better, through;
Creating a Venture Capital funding pool, and; 
an active marketing arm is best. (Austrade although efficient, is a
passive Marketing arm);
And then licensing the invention to other manufacturers.

Solution - give money to Academics along with a contract that states -
the University retains 8% of the successful invention - with the balance
being available for equity funding for a successful sales.

Anybody can start a company. Very few (1 out of 1340 Australian
startups) ever make the big time. 

Good interim Budget 
Looking forward to next years industrialization incentives correction
and with VC tax incentivisation included.

Tom












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