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Politics : View from the Center and Left
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To: Lane3 who wrote (10527)2/1/2006 4:54:05 PM
From: TimF   of 541778
 
Yes if he apparently wants to rely on investments that work more like bonds, but many early companies can't even get junk bonds. If you don't allow a possible massive long term return you reduce the incentive to take the risks, which IMO will not only lower the overall rate of growth, it will also have the effect of making economic "dynasties" easier, as it will make competition more difficult. (To be fair his time limited stock allows some of the incentives associated with possible outsized long term returns, it just reduces them)

You get a somewhat similar effect from a lot of campaign finance reform laws. To an extent the laws get passed because you have corrupt heavily entrenched incumbents, but most reform ideas and regulations cause incumbents to become more entrenched because they hurt new competitors more than the establishment.

Even things like environmental and workplace safety regs, personnel and reporting rules, complicated tax laws and such can have a similar effect. Sometimes the large more entrenched companies lobby for them. Partially this might be to have some input over what rules get implemented (we'll push for X so we don't get Y which is even worse), partially it also might be because it can be good PR, but another reason that is often overlooked is that such rules and regulations can hurt new competition far more than they hurt large entrenched companies.

Tim
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