roundtable: Re: "Economic Ignorance" with commentary by CITS

roundtable: Re: "Economic Ignorance" with commentary by CITS

Re: "Economic Ignorance" with commentary by CITS

Richard Layman (rllayman@netcom.com)
Fri, 20 Oct 1995 16:18:09 -0700 (PDT) 

Date: Fri, 20 Oct 1995 16:18:09 -0700 (PDT)
From: Richard Layman <rllayman@netcom.com>
Subject: Re: "Economic Ignorance" with commentary by CITS
To: roundtable@cni.org
In-Reply-To: <9510201422.AA24648@a.cni.org>
Message-Id: <Pine.3.89.9510201606.A13581-0100000@netcom19>


A couple weeks ago, I heard a speech by Lester Thurow, the prominent 
MIT economist.  He said a few things that were so straightforward I 
knew I wasn't in Washington (the speech was in Pittsburgh).

He said:

All the increase in the Gross Domestic Product in the last 15 years 
(? on exact time) has gone to the top 20% SES.

64% of that increase has gone to the top 1% of the SES

45% of total federal expenditures, including defense, interest on the 
national debt, etc., go to elderly programs today, and at current levels, 
that will be over 75% after the turn of the century.  (I wish I would 
have seen mention of that in some of the press coverage on changes to 
Medicare voted on by the House yesterday.)

Also, wrt the federal role in research and development, he said that 
fundamentally, the net present value of a dollar 8 years in the future 
is zero.  Therefore, big companies do not find it financially prudent to 
support R&D with payback periods greater than 8 years.... unless they 
are monopolies, like IBM and AT&T used to be.

He said one of the budget cutting moves Louis Gerstner did at IBM after 
becoming chairman was to cancel all R&D activities that had payback 
periods longer than 6 years.


Richard Layman, Mgr., Business Development, and Research Producer
Computer Television Network, 825 6th St. NE, Washington, DC 20002-4325
---- 202-544-5722 ---- 202-543-6730 (fax) ---- rllayman@netcom.com
http://www.phoenix.net/~ctn

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