I share with Thomas Friedman great interest in startups like EndoStim (and countless others), based on my belief that technological innovation is the key to a more prosperous economy.  Driven by venture capital, a creative of cutting-edge technological tools (through a process that Mr. Friedman calls "cloud manufacturing"), and global division of labor, small enterprises like EndoStim can provide amazing new products that enrich our lives, solve looming problems, and create new jobs — even new markets.

The driving force behind this economic progress is the profit motive:  venture capitalists seek a return on their investment, and without profits, a company — now matter how large — will not be able to provide the good or service, hire workers, or provide benefits to its workers. 

Unfortunately, government policies are moving in the direction that make it less likely that the next EndoStims take root in the United States.  As the tax cuts of 2001 and 2003 expire, the capital gains rate will increase by 33%; President Obama has advocated an even higher rate.  Such an increase reduces the potential return on investment for those St. Louis venture capitalists that Mr. Friedman mentions have bankrolled EndoStim.  Corporate and personal income taxes are also set to increase, meaning less money for EndoStim and others to hire more workers, or to reward current employees with improved compensation; to make matters worse, provisions of the health care "reform" recently passed will increase the cost of health insurance premiums for employees and for the companies providing that benefit.  And, government restrictions on immigration for highly-skilled workers decreases the pool of candidates to propel these startups to success, or even the entrepreneurs looking to start a new company themselves.

The sky is the limit for the growth of our economy as technology continues to move forward at nearly blinding speeds.  We need to make sure that high levels of taxation, government restrictions, and mandates don't hold back our own progress and push the next EndoStim to organize in another country — one more friendly to business and commerce.

Sincerely,
Dave Smith
Houston, TX