According to the recent Reason-Rupe poll Americans believe private not public investment primarily drives technological innovation. This does not mean Americans ignore public investment’s role, but that the economy’s technological engine is primarily fueled by risks and investments made by the private sector. Republicans are far more likely to say private investment primarily powers the economic 83 to 10 percent, as do Independents 72 to 21 percent. Only a slim majority of Democrats agree, with 51 percent versus 39 percent who think public investment is most important for technological innovation.
Among Americans who believe public sector investment is most important for innovation, 77 percent approve of President Obama and 18 percent disapprove. Fifty-seven percent of these respondents also “strongly support” increasing taxes on the wealthy to balance the budget. In contrast, those who say private investment is most important, 54 percent disapprove of the president while 41 percent approve, and 32 percent “strongly support” increasing tax rates on the wealthy.
Middle age is correlated with greater belief in private investment. For instance, 56 percent of 18-24 year olds and 63 percent of Americans over 65 compared to 71 percent of 35-54 year olds. Majorities of Caucasian (73 percent) respondents as well as a slight majority of Latinos (52 percent) believe private investment is most important; in contrast 53 percent of African-Americans think government investment is most important.
Although households connect private investment with innovation, the connection is less clear between tax structure and investment, and thus taxes and innovation. The Reason-Rupe poll asked Americans whether raising taxes on wealthy households makes a significant difference in reducing the money available for investing in business start-ups, only 35 percent thought there was a connection. Likewise, only 26 percent thought raising taxes on high earners reduces the amount they work and invest. Consequently, it is less surprising that 73 percent thought raising taxes on wealthy households would have no significant impact on innovation. Read more about these results here.