NCPA - National Center for Policy Analysis

Lobbying for Future Start-Up Companies

September 24, 2015

The goal is a 4 percent growth in annual GDP. While this may seem ambitious, lobbyists at Lincoln Labs suggest that the U.S. economy could be jumpstarted if three specific areas were targeted:

  • Open the $6.2 trillion government sector to competition;
  • Fix intellectual property laws;
  • Eliminate outdated regulations.

Large, established companies are typically slow to innovate, while new businesses provide competition and push development. Unfortunately, too often the large corporations hold the most power in influencing policy and can keep competition low by creating barriers for start-ups.

  • For example the U.S. corporate income tax, one of the highest in the international community, is at 35 percent.
  • However, big businesses are able to afford lawyers and lobbyists who procure tax breaks and protect market shares while smaller firms, unable to hire expensive specialists, continue to pay at a 35 percent rate and are pushed out of the market.

To stimulate economic growth, changes need to be made to copyright policy to shorten term lengths, redefine fair use laws and restructure the Digital Millennium Copyright Act. Similarly, the patent system needs to be reevaluated as there are currently 78,978 pages of regulations.

In order to reform the current system, which hinders economic growth, Lincoln Labs suggests:

  • Allow public access to all non-sensitive government data in a computer readable format.
  • Encourage competitive bidding for government contracts with low entry barriers to encourage innovative and cost-effective venders.
  • Reduce federal government costs by implementing new technologies.
  • Use outside consultants to reform government agency structures to streamline processes and limit duplicity.

Source:  Derek Khanna et al., "Lobbying for the Future," Lincoln Labs, September, 2015


Browse more articles on Economic Issues