The story goes that, one day back on the 1940’s, a group of atomic scientists, including the famous Enrico Fermi, were sitting around talking, when the subject turned to extraterrestrial life. Fermi is supposed to have then asked, “So?……

Paul, tax reform is not a short term strategy but rather a long term attempt to stimulate R&D and investment. This comes around to Martin’s point, it’s difficult to stimulate R&D and education (just another form of R&D) without economic incentives that offset the costs.

In the U.S. we benefit from high per capita higher education levels and high R&D investment, which are both a function of a tax system that encourages both.

I agree to some extent with Martin although I too feel this isn’t the right way to go about resolving the EU’s problems. Tax-wise I unfortunately feel the burden directly. Yet, I would be interested in seeing whether tax breaks and labor law changes would so quickly lead to innovation in the EU…..they would of course help. I am sure you’d see a wave of new businesses show up but you also need the people and know-how. This is getting better yet it’s not an overnight thing. Further, if you look at what the High-Tech Founders Fund is doing in Germany, it’s a government initiative which is helping to seed investments. These are 500k injections into companies less than one year old. It is a great source of dealflow for the European VC community and helps to fill the void in regards to VC’s willing to do such early-stage deals. It may not be optimal yet at the same time it’s better than nothing.

Paul

While I agree with your comments about this being a complete waste of my tax-pounds, can you not come up with something better than the perennial whine about tax-breaks and labour-law. In the UK these are not the main problem, instead blame the constant short-term’ism by investors and a lack of decent technical + financial training.

That’s why governments feel forced to prime the pump, because there’s precious few other sources.
And governments, like journalists, get things wrong.

Martin

I agree with your analysis 100%. If anything, by giving away millions of Euros to leading companies – you are going to scare away angel investors and VCs from funding any Euro-centric search startup. After all, who wants to compete against government largess?