Cubanonomy

Mark Cuban by all accounts of what I hear and read seems to be a decent guy. Yea, he says some crazy things on TV when being interviewed but who hasn't yelled worse to their dog who just chewed on your shoes after peeing on your bed. Cuban's latest blog post is called: Some Notes to Congress on the Economy and it is a rather interesting read. Cuban distinguishes three main points that he would like to interject to congress. I agree with all of the points except for a little section in point three. Point three states:


"The best way way to create jobs in this economy ? Follow the Y-Combinator model and make all equity investments up to 250k dollars and held for at least 3 years tax free when sold. If you aren’t familiar with how Paul Graham and his competitors do things, you should be. They truly are the ones creating jobs. Speaking for myself, I have invested 250k or less in 8 or so businesses (some are still in process) in the last 12 months. Now I personally would have done it with or with out a tax break, but the way our economy works, with everyone hacking tax regulations, a tax break will push more people in this direction. The more NON RECOURSE money available to startups, the more startups and jobs created and the more likely a huge employer emerges.

Not only is there a chance a large company is built, there is a chance that the “next big thing” emerges and catches fire, leading to hundreds of thousands of jobs or more being created. I’m hoping that our politicians realize that LUCK is the key to getting unemployment back under 5pct. It’s going to take luck for someone to create the idea that we all missed and use angel funding from a source like Y Combinator to turn it into a company(s) that accelerate the economy much like The Internet and the PC Revolution did. If my memory serves me, Michael Dell, Bill Gates, Marc Andreeson weren’t out looking for loans from banks to start their companies. They used relatively small amounts of friends and family money. Make those investments tax free and we stand a chance to see the next generation Dell and Gates emerge."

(and no, this isn’t contradictory to my carry interest position. The investors should get the tax break, not the people who take a percentage of the profits (the carry interest) the investors would otherwise get paid).

Mark Cuban is thinking like a wealthy person (as he well should). It seems to me that if the rich are the only ones who should have the power to invest in start-up companies, as opposed to borrowing money from a bank, then the rich will be the only ones acquiring more wealth. If Cuban's suggestion were to become reality I think the U.S. would have to face even more economical hardships than she currently is. 
 
Letter to mom:
 
Dear Mom,
 
The age old saying you taught me when I was a young lad of, "It Takes Money To Make Money" seems to still be holding true in 2010 for people under 40 and probably will so for the forseeable future. However, we should change the saying to, "It Mostly Takes Luck To Get Money To Make Money." I hope one day when I grow old hard work and dedication to your job will be rewarded with peace of mind during your retirement. I just hope my retirement will be at an age where I can still see, walk, talk, and comprehend my life. 
 
Your Truly,
Michael  

 
What else is there to say but goodnight and goodnight to you Mrs. Amore, wherever you may be.