To put it simply, direct investment plays a lot better with business owners' incentives than lowered taxation.

It's a false corollary to expect lowered taxation to immediately equal greater spending - especially in times of economic flux, that sort of government action mainly encourages /hoarding/ behavior, which isn't good for the economy's health.

On the other hand, direct investment in startups gives an immediate incentive to spend - spend and grow.

Spending more on public goods like health care helps - the money we'd save with a public option is obvious to anybody that isn't a far-right ideologue. But that's /saving/ wealth, not /creating/ wealth. When you finally snip away all the excesses and waste generated by the current model of health care coverage, you still need something to pay for the cost of the improved system itself.