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Open Source R&D Tax Credit? 196

Posted by ScuttleMonkey from the never-get-past-the-lobyists dept.
Dan writes "The Center for American Progress is proposing an R&D tax credit for open source development." From the article: "Subsidizing open source software development can also be justified on grounds of economic efficiency. Open source software development enhances the ability of other developers to create new products. It also enhances the development and dissemination of knowledge and ideas more broadly. Since the benefits to the broader software development community and the economy as a whole go well beyond the users of an individual software product, a policy that subsidizes open source development would increase economic efficiency."
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Open Source R&D Tax Credit? More

Open Source R&D Tax Credit?

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  • Built In Tax Break (Score:5, Funny)

    by rtb144 ( 456739 ) on Monday March 20, 2006 @06:19PM (#14960369)
    Most open source software comes with a built-in tax break. No income, no income tax.

    • Re:Built In Tax Break (Score:4, Insightful)

      by steelfood ( 895457 ) on Monday March 20, 2006 @06:47PM (#14960564)
      This would probably be for developers who work other jobs on the side (like college students who have high-paying campus jobs), people who develop OSS for a living (e.g. people working at the Mozilla foundation), OSS authors who accept donations, or companies who develop or contribute to OSS (e.g. Redhat, IBM, and now Sun).

      That having been said, there are a lot of issues with such a tax break. For example, what are the qualification criteria? Significant contribution? Lead developer? Credited developer? Also, what are the criteria for something to constitute as OSS? Non-viral licensing? Compiled/interpreted language? What about markup languages? Or things that are not code but are released under a creative commons license? What about patented methods where the patent holder is also the lead developer? Finally, while slightly easier to define than the above since there are already precedents set, what constitutes development costs?

      • Re:Built In Tax Break (Score:3, Insightful)

        by jadavis ( 473492 )
        For example, what are the qualification criteria?

        I think you just described the question which is the whole reason for copyright. Nobody knows how useful any creative work is. It can only be measured by demand. And demand is hard to measure without artificially limitng the supply. F/OSS software does not artificially limit the supply at all, so it's very hard to tell the difference between a novel program, and a worthless pile of code that was just developed to get the tax credit.

        You can see similar problem
      • > For example, what are the qualification criteria?

        Looks like they are aiming at limiting it to actual expenses, which does help a little in reining in the more obvious abuses. So you could claim hosting expenses for example, so long as all of the expense was your Open project. A site that also had personal stuff would could an accounting nightmare. You could claim travel expenses to a conference. If it happened to be in Orlando and you also go see Mickey while you are there... well current business
      • class HelloWord{
           public static void main(String[]args){
                 System.out.pritnln("My contribution to OSS");
           }
        }

        I'releasing this code under GPL. Can I have my tax break?
    • I didn't RTFA, but the difference between a tax break (deduction) and a credit is that a credit can go negative (from the treasury's point of view).

      IOW, a $500 deduction will eliminate your tax liability on $500 of income, but a $500 credit will result in a $500 check drawn on the treasury if you have no income.

      (I'm against all tax credits, as they form a back-door entitlement.)

      -Peter

  • Its been thought of (Score:5, Informative)

    by akb ( 39826 ) on Monday March 20, 2006 @06:20PM (#14960379)
    http://public.resource.org/main.html [resource.org]

    Notice Al Gore was VP when this proposal was made.
    • Here's how: Get an organisation to set up as a charity that wants some softwae developed. Programmers write code and donate this to the charity. The charity then gives the programmer a receipt for a charitable donation which can be used at tax time.

      If Clinton could claim for the used underpants he gave away, why should programmers not get a break too?

  • Center for American Progress (Score:3, Funny)

    by wombatmobile ( 623057 ) on Monday March 20, 2006 @06:21PM (#14960392)

    Center for American Progress

    Where is the center of American progress? The president says the front of it is in Baghdad.

  • Seems odd... (Score:2, Insightful)

    by Otter ( 3800 )
    I thought there were glorious financial advantages to open-source development? Seems odd that we need taxpayers to subsidize what is so obviously in people's economic self-interest in the first place.

    • Re:Seems odd... (Score:3, Insightful)

      by Foofoobar ( 318279 )
      Well a tax credit for products that will be freely available and better stimulate business and government growth could actually encourage lawmakers to put open source projects and applications at the forefront of adoption in schools, universities, government and military IT departments.

      After all, if they are giving a tax credit, it would encourage them to adopt it to get their money out of it.

    • Advantages for whom? (Score:3, Insightful)

      by AlpineR ( 32307 )

      "Seems odd that we need taxpayers to subsidize what is so obviously in people's economic self-interest in the first place."

      Huh? Open source software benefits the users, but it's still a drain on the resources of the individual who writes it. The writer might gain from having others contribute to his project, but users who neither write nor contribute have the best cost-benefit ratio.

      Taxpayers subsidize work precisely because it benefits them. Patents are granted because we all gain from the disclos

    • Taxpayers are already subsidizing commercial developers. This proposal is intended merely to extend the same benefits to individual developers.
    • Huh? Taxpayers subsidize commercial software -- business expenses are tax-deduxtible, as long as they are related to some source of revenue. All this would do is even the playing field for open-source software development, whose expenses are not tax deductible since there are no direct revenues.

      A current way to deduct expenses relating to F/OSS is to produce it as part of a 501(c)3, which is not easy to qualify for, set up, or maintain the status of if you're doing F/OSS development in your spare time w
    • I thought there were glorious financial advantages to open-source development? Seems odd that we need taxpayers to subsidize what is so obviously in people's economic self-interest in the first place.

      FOSS has always been heavily subsidized. BSD, GNU (RMS's work at MIT?), all the academics doing research , etc.
  • Or tax shuffle? Never trust the government when they float the words 'tax credit'

  • not a subsidy (Score:2, Insightful)

    by Kohath ( 38547 )
    A tax cut ("credit" in this case) is not a subsidy.

    I also don't think we need the IRS to define whether a project is "open" or not.
    • A tax cut ("credit" in this case) is not a subsidy.

      Actually, that's exactly what it is, unless the meaning of subsidy has changed in the last 24hrs.

      BBH
      • You should read the definition of subsidy again then.

        Taking $4 from someone against their will instead of taking $5 isn't subsidizing (synonym - "assisting") them. I guess John Dillinger was subsidizing all the banks he didn't rob?
        • I guess John Dillinger was subsidizing all the banks he didn't rob?
          Only if banks were required, by law, to be robbed by JD.... Sort of like taxes. Getting it now?

          BBH

    • I also don't think we need the IRS to define whether a project is "open" or not.

      Any time you ask the government to reward you for something, I think it's only fair that the people paying out that reward (the taxpayers) have a say in what counts as rewardable and what doesn't.

      I'm all for people saying they have a right to do what they want in their private life, but they have left their private life when they start applying for special treatment from the government.

      To the actual point of openness, it

  • Interesting (Score:3, Insightful)

    by RingDev ( 879105 ) on Monday March 20, 2006 @06:35PM (#14960486) Homepage Journal
    I'm wrapping up my school education, my house will be paid off soon enough, and the interest on my student loans is not going to be enough to off set my income. Yup, I'm going to need to find a new tax shelter in another year or two.

    "we are proposing a 20 percent tax credit for qualified out-of-pocket expenses for open source software developers."

    Well let's see what "out-of-pocket" expenses are defined as. Because my 'Home-Office' is paid for out of pocket. So that roughly 100 square foot room represents about 1/10th of my house's square footage. Figure the cost of the house minus the land, that's like $140k, which means I should be able to claim 20% of $14k for that expence. And then their are the numerous PCs, the custom built desks, the wiring, the internet connection... I bet I could pull enough expences out of that room to fully clear my taxes for a year, and enough residuals to help cut down from there on.

    I wonder what limitations there are on this, if I could put a dent in my income tax by switching some game mods and tools to open source, I would switch them in a heart beat. 8 hours a week on a pet project to cut down on taxable income, a deal too sweet to pass up.

    -Rick
    • You paid off your house before finishing your education? That's unusual. I take it you went back to school after some other career?
      • Nah, my house will be paid off in about 6-7 years, my education should be completed by the end of this year. I was a software developer in the military and then a consultant just after the .Com bust. Spent a few years floundering for work, and finally went back to school on my VA benefits. Picked up a CS Assoc and a new job about 2 years ago, and I should be wrapping up my CS/Tech Management dual bachelors this year.

        -Rick
    • I wonder what limitations there are on this, if I could put a dent in my income tax by switching some game mods and tools to open source, I would switch them in a heart beat.

      I wonder the same thing. No offense intended, but I would hate to have my tax money subsidize game mods.

      • A twenty percent tax credit is hardly a "subsidy".

        C//
        • A twenty percent tax credit is hardly a "subsidy".

          Anything that means I pay a bigger share of taxes than somebody who earns the same amount is a subsidy. Why do you think I should be required to shoulder a bigger share of taxes compared to somebody who makes game mods? (Of course, I would be a bit surprised if a finalized law actually would permit the credit to game mods, so this is really just an academic discussion.)

  • Non-profit foundations that develop open source are already tax deductible.

    I hate to be the one pouring cold water on this proposal, but it sounds more like an abusable deduction that would allow any programmer to write off 20% of all their computer equipment purchases. If I wanted to abuse the system, couldn't I just write a hello world program, say I spent 2 monthes writing it, throw it on my website, and claim a fat deduction on everything? Would the government have to get in the business of deciding w

    • I hate to be the one pouring cold water on this proposal, but it sounds more like an abusable deduction that would allow any programmer to write off 20% of all their computer equipment purchases. If I wanted to abuse the system, couldn't I just write a hello world program, say I spent 2 monthes writing it, throw it on my website, and claim a fat deduction on everything?

      To put it another way, the amount of effort you'd have to expend on accounting probably outweighs any benefit you'd get. Basically, if you

    • Loopholes? Like:

      10 taxes = new.civilresponsibility ();
      20 taxes.dodge
      30 goto 20;
      Damn, I can't be bothered coming up with something funnier than this. Must be getting near midnight.

  • Subsidies as a cure for "economic inefficiency" (Score:3, Insightful)

    by Ogemaniac ( 841129 ) on Monday March 20, 2006 @06:41PM (#14960531)
    There is always one glaring flaw with this plan, even if there is a real market failure that could be addressed by the subsidy - taxes are economically inefficient. Typical estimates of the inefficiency of our standard taxes (income, payroll, sales, and property) run between 10 and 60 cents on the dollar collected, with 20 cents being a conservative average. In other words, the government has to remove $1.20 from the economy to collect a dollar. Or, you could say the government pays for everything at a 20% premium.

    Even if there is some sort of market failure with respect to open source (it is probably the same one that is cited for R&D in general), trying to cure it with another market failure is not the answer unless the R&D failure is much larger. I once saw a presentation by someone from NSF on this very topic (The Economic Case for Basic Research), and when I pointed this problem out to him, he actually didn't have an answer. I was surprised, given that most of us learned about the inefficiency of taxes in Econ 101.
    • It's not a "cure" for anything. Commercial developers and businesses that develop in-house software get to claim credits on development costs. This proposal extends the same benefits to individual developers. What's good for the goose...
    • A tax subsidy removes the market-distorting effects of taxes, it doesn't introduce new ones. This is because coporations are deciding how to allocate their capital, the government isn't doing it for them.

      Companies are currently underinvesting in R&D (relative to recent 1950s- American history). Part of this is because the money they spend on R&D is taxable at standard rates, while there are other investment choices with lower tax cost (e.g. buying depreciable cubicles). When R&D taxes are d

    • You've made a very important assumption. The assumption you're making is that the breakdown goes like this:

      government removes $1.20 from the economy through taxation

      $0.20 lost as "waste heat" somehow
      $1.00 spent on economically useful projects

      $1.00 + $.20 = $1.20, and everyone's happy.

      The real problem is that by definition, a governments activities contrary to an efficient market. If they weren't, those activities would already be taken care of by said market. The social merits of those activities are irr
  • The value of an individual's donated time would not qualify|similar to the way charitable contributions are treated. However, out-of-pocket costs, such as fees for web hosting, the depreciated cost of capital expenses such as computers, travel to development-related conferences, and other expenses would qualify for a 20 percent refundable tax credit. We chose 20 percent as the amount of the credit after an examination of the literature surrounding the historical value of the Federal Research Tax credit. ...

  • This is a bad idea in my opinion (Score:3, Insightful)

    by BigBuckHunter ( 722855 ) on Monday March 20, 2006 @06:44PM (#14960551)
    Any tax break of government subsidy is a bad thing. It gives the government control over the direction of any FLOSS that takes the money (just like schools that take federal money). It also puts you in a strange position if the software that you are developing violates one or more of your countries laws. I'm not willing to change the direction of my projects just for a subsidy.

    BBH
    • Here's just a random idea off the top of my head, but what about not applying for the tax credit if you don't want it?

      Having the government steal slightly less of your money because you spent some of it developing open source software probably doesn't seem like a bad idea for a lot of us...
      • what about not applying for the tax credit if you don't want it

        It would be like not declaring charitable donations. All is well till audit time comes up, then they're like, "why didn't you declare these tax breaks", and you're like, "I do not feel it is prudent for the government to subsidize private industry". You'll get an awkward 10 second pause, followed by the worst three months of your life as they audit you for the last 5 years income.

        BBH
    • How would this give the government any control? The IRS isn't going to audit your projects to see if they're 'un-American'.
  • And Microsoft would immediately apply for its "Shared Source" to be granted a tax break.

    Would you want the US Congress determining the meaning of "open source"?

  • You can get tax breaks for closed source NOW (Score:3, Interesting)

    by HippieJoe ( 632993 ) on Monday March 20, 2006 @06:46PM (#14960562)
    Why wait for a proposal to pass when you can get HUGE tax credits for writing closed source software NOW? For example, Ohio gave a closed source company $82,386 to keep it's 11 employees in the state! (http://www.odod.state.oh.us/newsroom/releases/135 7.asp [state.oh.us] Third example, tax break + grants) Thats $7489 per employee now, not in some proposed future.

  • So all we have to do is put our totally unusable by any one else source code into open source, and suddenly we can write off our development costs!

  • Keep your freakin tax credit and give back my SSI (Score:4, Insightful)

    by argoff ( 142580 ) on Monday March 20, 2006 @06:50PM (#14960586)
    The truth is that all too often the government taxes people too much, and then they find themselves needing to give "tax credits" back to spurr innovation, retirement savings, house savings, college savings, and medical savings. Well bullshit. All that does is give the government more controll in my life to decide what is a priority and what is not.

    How about if they quit freakin taxing me so much to begin with. A nice start would be SSI, anyone under 40 must surely know that they'll never see a peny of it anyhow (unless the dollar is hyperinflated out of existence). Not only that, but we pay for it twice: once before you get your paycheck, and then it's deducted again after you get your paycheck. I especially resent using that number that dog tags me and makes it a cakewalk to steal my ID, I resent being forced into a ponzi scheme, and especially resent coercing my kids to pay for my retirement.
    • It's ironic that the system designed to protect us from centralized power and its abuses has effectively just created a multi-tiered tax system. Between federal, state, and local taxes, many people are paying almost half their incomes in tax, and no one level is particularly accountable to any other. So the states can claim that they need their 7% income and sales tax, the city can claim their property tax, and the Fed can claim their ~30%.

      But, at least they're responsible with our tax dollars, maintain a
    • A nice start would be SSI, anyone under 40 must surely know that they'll never see a peny of it anyhow

      Unless people like Bush manage to turn back the clock to 19th century conditions with people starving in the streets, one way or another, the government will provide minimal food and health care for old people. After all, old people vote.

      I especially resent using that number that dog tags me and makes it a cakewalk to steal my ID

      If right wing nuts didn't keep interfering in the deployment of a secure natio
      • "people like you would just have a party with their money or invest it poorly and the state still would need to take care of you when you're old"

        Ah yes, classic liberal attitude. "Other" people are stupud, so we must protect them from themselves.

        I fail to see how the inefficiency of the system are outweighed by the benefits of forced spending.

        Social Security was created to protect people from unfortunate economic luck in life. But maybe it has removed some incentive for people to plan and invest for the fut
        • Ah yes, classic liberal attitude. "Other" people are stupud, so we must protect them from themselves.

          It's not about protecting people from themselves, it's about protecting my pocket book from your poor choices. Why? Because if you don't fund your own retirement, society will have to bear the burden of clothing and feeding you no matter whether you have paid into social security or not.

          But you're right to this degree: social security is probably a bad way of doing it because it's regressive and raises fal

      • Unless people like Bush manage to turn back the clock to 19th century conditions with people starving in the streets, one way or another, the government will provide minimal food and health care for old people. After all, old people vote.

        People voting didn't prevent the great depression, nor the inflation in the 80's. You can't vote something that is inherently insolvent to become inherently solvent. If people like Bush don't manage to shut down SSI, the dollar will likely become insolvent.

        If right

        • If people like Bush don't manage to shut down SSI, the dollar will likely become insolvent.

          The US is becoming insolvent because it is spending a large amount of its tax revenues on military adventures that it cannot afford; in different words, the great, proud US military is financed by loans from the Chinese, the Japanese, and the Europeans.

          And the devaluation of the dollar has nothing to do with social security (what a hare-brained idea); it is simply the result of trade imbalances. The fact that the dev

    • Insightful? Off-topic! and incorrect.

      We don't have a Social Security crisis. It's all crap propaganda. It definitely needs to be tweaked, but the politicians are just trying to rile people up and divert attention from real issues. And they're succeeding.

      We have a surplus of SS money for at least until 2040. The projections go out for 75 years and sometime before then, we start having a debt regarding SS taxes coming in and money going out. Congressional Budge Office (CBO) studies show that if we don't

      • The problem isn't the social security system. It's the men and women of the Executive and Legislative branch that balloon the deficit with pork barrel spending. Even if we remove the SS blanket, there's no gaurantee that these people wouldn't spend the money elsewhere. Before we talk about changing social security, we need to have people that would be fiscally responsible.

        This is wrong on so many levels, I don't even know where to start. FYI, the SSI program is moral and intellectual sewage. Even if we

        • How convenient. You disregard data because it might contradict your views. You talk in general terms but really don't address SS itself. And your previous post which had no more substance is still moderated insightful. How sad.

          • You talk in general terms but really don't address SS itself. And your previous post which had no more substance is still moderated insightful.

            This is because the fundamental problem isn't how the conclusion is drawn, the fundamental problem is the premise. Get the freakin premises right about SSI, and I'll have no problem arguing about how things will draw out. Untill then, it is a waste of time.

            How Sad

            Indeed.

    • anyone under 40 must surely know that they'll never see a peny of it anyhow

      And everyone over 40 surely knows that the only way they'll see a penny of it is if they keep taxing those of us under 40.

      Never underestimate the power of the AARP in actually getting people to the ballot box.
    • How about if they quit freakin taxing me so much to begin with. A nice start would be SSI

      From the rest of your post, I get the impression that you are talking about Social Security. You should know that the term SSI is commonly used to refer to Supplemental Security Income, which is different and completely separate from social security.

      http://www.ssa.gov/notices/supplemental-security-i ncome/ [ssa.gov]
  • A government that has the power to raise or reduce taxes to benefit open source ALSO has the power to raise or reduce taxes to benefit huge corporations with a heck of a lot more money to give for campaign contributions... who do you think this type of economic intervention will wind up benefitting more? Sorry, but I'm a flat tax advocate -- the government shouldn't be mucking with the economic system at all through preferential taxation. If open source is to succeed or fail, it must do so on it's own merit

  • Fair enough... (Score:2, Insightful)

    by Mr. Funky ( 957139 )
    But be careful !
    I am a coder long enough now to know good programming is a form of modern art and thus should be appreciated accordingly.

    But... If they just hand over the money, I see some problems on the horizon.
    I mean, as long if it is OSS most people just code for fun and fame, but if money gets involved people get greedy (don't we all?) + every Billy-Joe-Bob would become an 'OSS-developer' all of a sudden.

    Instead they'd better sponsor resources such as PC's, servers, hosting, free fat pipes for develope
    • Instead of doing tax breaks, I'd prefer to see either a Department of Open Source (DOS?) that could officially sponsor specific projects and pay for them the same way all such contrace work is paid for, OR have them set up an Open Source X-Prize for projects that meet specific community needs.

      (For example, there's a major lack of Open Source educational software. So, either offer a grant of X amount for one set of Open Source developers to produce it, or offer a prize of X for the first team that can meet s

  • No thanks! (Score:3, Interesting)

    by Zarxrax ( 652423 ) on Monday March 20, 2006 @07:27PM (#14960816)
    Instead of supporting the further degeneration of a broken tax system, how about supporting a better one altogether? http://fairtax.org/ [fairtax.org] http://fairtaxgroups.com/ [fairtaxgroups.com]

  • OSS has already paid for itself here (Score:5, Informative)

    by hacker ( 14635 ) <hacker@gnu-designs.com> on Monday March 20, 2006 @07:33PM (#14960845)

    As an OSS developer, I can say that working on Open Source code/projects has already paid for itself in tax deductions many times over in the last decade.

    Those donations you get from the "Paypal" button on your project homepage? Deductable as gifts, not income.

    Those hard drives you upgraded to house your OSS code through RCS on a RAID system? Deductable as a business expense.

    The space in your house used to develop/work on that OSS code? Deductable as your "workspace".

    In my case, I also host and house dozens of projects for the OSS community, mailing lists, web space, torrent trackers, and lots of other things.

    That broadband bill? Deductable. Power to keep servers running 24x7? Deductable.

    I also have a "regular day job", and I work at the home office, so that too, is deductable, since it is a dedicated section of the house specifically for that.

    Being a long-time OSS developer and supporter has definitely paid for itself many times over in deductions alone, not to mention the Google ad revenue that helps fund the websites I maintain and support, out-of-pocket upgrades to storage, servers, etc.

    Having a clueful CPA? Priceless .

    • Deductible gifts? I hope that you mean you exclude them from your income... You might consider them deductible if you report the income and then deduct it? Does PayPal report your receipts as gifts or something? Otherwise, you would not report or deduct the income if it is properly considered a gift.

  • Horrible Idea (Score:2, Interesting)

    by Anonymous Coward
    How about letting market forces (you know, that little supply and demand thing) determine how/when/why a product is adopted instead of using community resources to pad it? Successful OpenSource projects are successful because they are forced to COMPETE, often much harder than their proprietary counterparts. Weighing the game in favor of OS does as much damage as IP does for proprietary software.

    Furthermore, just because software is OS doesn't mean it's good. Why give tax credits to those who don't deserv
  • This proposal makes an incredible amount of sense. The open source model is an excellent way to develop high quality software on the cheap. Large scale open source development would help the economy in a number of ways.

    Therefore it will never be approved.

  • Comment removed (Score:5, Insightful)

    by account_deleted ( 4530225 ) on Monday March 20, 2006 @08:02PM (#14960990)
    Comment removed based on user account deletion
    • I agree with you that tax deductions and credits are overused, but launching into the old "lets move to a sales tax based system" has always been and forever will be bad system for the poor and a great system for the rich. Why? Because a loaf of bread costs the same no matter how much you make, but you can buy a whole lot more loaves of bread as a rich person. And yet if you need 21 loaves of bread a week to survive and as a poor person you can only buy 10, how does taxing the loaf of bread make it any f
    • Be careful how a goods and services tax (GST) is implemented.

      The government here in Australia brought it in about five or six years ago, on the promise of lowered income tax and generally cheaper goods.

      Some of us wondered how that could work - if the government gets less money, how can they provide the current level of services? We were shouted down by record advertising spending promoting the tax. You couldn't turn on the TV or look at the paper without seeing how it'd 'unchain families from their tax burd

  • s/Open Source/Public Domain/g (Score:3, Interesting)

    by iamacat ( 583406 ) on Monday March 20, 2006 @08:23PM (#14961071)
    If I already paid for programmer's time with my taxes, I should be able to use the source in any way I want - without giving away my own work, acceditation or any other trouble whatsoever. By the way, the same goes for patents received by university stuff/students, software written for a government contract etc.

    If you want to impose GPL on me, do it on your own time/dime.
  • This tax-credit doesn't go far enough.

    We already let people deduct charitable donations from their taxable income, why not charitable labor hours? Open-source is but one form of volunteer work, the others should get credit. People's labor is worth something, especially for a worthy cause.
  • Since the benefits to the broader software development community and the economy as a whole go well beyond the users of an individual software product, a policy that subsidizes open source development would increase economic efficiency.

    Tax Credits essentially means that the goverment pays people to develop Open Source Software. Open source is currently being subsidised by corporations who pay people to continue to develop an open source product. Many major corporations employ people to continue OSS proje
  • GPL'd code may not be able to offer a tax break, it's discriminatory, it denies access to a large segment of taxpayers. BSD'd code would have a better chance of surviving legal challenges. More importantly, stay away from the government, you have no clue what a mess you could make of things by increasing government involvement. If a tax break were available for GPL'd code, and if it lost a legal challenge, then a corp may take the next step using this precedent to challenge any taxpayer funded projects bein

  • Subsidies are NEVER economically efficient! (Score:4, Insightful)

    by doubledoh ( 864468 ) on Tuesday March 21, 2006 @12:10AM (#14961895) Homepage
    Subsidizing open source software development can also be justified on grounds of economic efficiency.

    I haven't heard a statement as absurd as this on slashdot for at least 5 minutes! The very idea of calling a subsidy "ecomonically efficient" is an oxymoron. If something needs to be subsidized, then its very clear that there isn't enough demand for the product or service at said price in the free market. If the demand is not great enough, then the product or service must improve, die, or be absorbed by a more successful seller (or programmer). Not one single dime of my tax money should go to pay for open source software. If I find value in open source software, I'll VOLUNTARILY donate money to it. Once you take away the voluntary payments, and force people with a gun to pay something (ie, tax them), then the software can no longer be considred "open" source. In fact, its even worse than closed source...because at least you have the option of not buying closed source software.

    • See this [slashdot.org]. Your argument is only correct if you take a narrow view of what economics is. There are many things of value that can't be measured in dollars.

      People cooperating through government to develop software for a once off cost that could then be copied millions of times could easily be hugely economically efficient, beating the current ">$40,000,000,000 per year for about a dozen programs developed more than two decades ago" model we currently have that is in large part a tragedy of the commons.

      N

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