First of all, the amount of really innovative research being done in the private sector has actually declined since the heyday of Bell Labs and similar corporate research divisions in the fifties and sixties. Partly this is because of a change of tax regimes. The phone company was willing to invest so much of its profits in research because those profits were highly taxed—given the choice between sinking the money into higher wages for its workers (which bought loyalty) and research (which made sense to a company that was still locked in the old mind-set that said corporations were ultimately
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