Strategic Planning Document -
Civilian Industrial Technology
Research and Development
I. EXECUTIVE SUMMARY
Technological innovation drives economic growth. It is a powerful force for the creation of good jobs and a steady rise in living
standards. With the end of the Cold War, the globalization of the world economy, and the explosion of new information and manufacturing
technologies, technology is more dominant than ever in raising productivity and achieving world-class industrial performance.
Change at such an accelerating pace can be a source of anxiety and uncertainty; but government, working in partnership with industry, can instead
make it a source of enormous opportunity for America.
While the private sector plays the major role in applying technology to economic growth, the government also has an
indispensable part to play. Three fundamentals for technology-based growth are first-class education and training for all Americans, a strong
fundamental science base, and a business environment conducive to investment in research and innovation. All require effective government
policy. But they must be augmented by an innovation system that moves emerging and enabling technologies from the science base to products and
services in a timely and effective manner. In some instances, government investment in partnership with industry can be critical to the
early pre-competitive development of civilian technology. Where the costs of investing in new technologies are very high and the rewards
distant -- and especially where benefits to other firms and society at large are likely to outstrip returns to the individual investing company -- private investment is usually inadequate. For advances in this
kind of high-risk, high-payoff technology, government can share the risk and create benefits that reach beyond individual firms. In addition,
government can provide connections between the science establishment, the education community, government science and technology
programs, and private industry.
For half a century after World War II, federal science and technology policy was mostly limited to support of fundamental
science and traditional government missions -- chiefly national security, health, and space. These investments benefited American
industry, and seemed adequate at a time when U.S. firms dominated the world economy. Today we live in a different world. Tough international
competition has forced corporate cost-cutting drives, leading companies to target in-house research on technologies that are close to
commercialization at the expense of longer term or riskier research. Moreover, the accelerating pace of technological advance, ever shorter product
cycles, and rapid worldwide diffusion of technologies make it still harder for many companies to invest adequately in risky or long-term R&D.
The new model of best practice that is taking form is to create partnerships for riskier or more generic R&D -- teaming with other companies, with
universities, and with the government.
The Committee on Civilian Industrial Technology (CCIT) of the National Science and Technology Council (NSTC) is responsible for
oversight and coordination of government-wide R&D and allied technology programs that promote industrial competitiveness and economic
growth. This document describes the purpose and activities of CCIT.
The major purpose of the CCIT is to ensure that the government's R&D resources relevant to industrial competitiveness are used
efficiently and effectively. To meet the dual goals of deficit reduction and investment in the Nation's future, R&D investments
must be designed to get the greatest possible leverage. Better coordination and management to see that priority areas receive proper attention is
the way to reach these goals.
Collaboration with private industry is central to CCIT activities. Industry brings to the table crucial market experience in
selecting areas for technology investment. For its part, government can provide a long-term outlook, support for enabling technologies (such as
standards and measurement) that benefit industry broadly, and reduction of risk in investments with potentially high social payoffs but questionable
returns to individual companies. In addition, government can act as convener in bringing together efforts that individual companies
cannot accomplish on their own. Government-industry partnerships for these purposes have had broad support for many years in several areas
(agriculture, civilian aircraft, and standards and metrology). And since 1980, bipartisan legislation has encouraged R&D
partnerships in wider areas, including technology transfer from federal laboratories to industry and collaborative R&D for pre-commercial technology
Principles governing industry-government civilian technology partnerships include:
- industry leadership
- competitive selection, on the basis of merit, of cost-sharedprojects
- evaluation of partnership programs to determine their success
- mechanisms for ending programs when goals are accomplished
While all the programs coordinated by CCIT have the central purpose of promoting economic growth, they also include public benefits
that are external to the market, and they differ in emphasis. Some activities focus on enabling technologies that apply across a broad range of
industries. CCIT's subcommittees on Manufacturing Infrastructure and Materials Technology are in this category; included here are
programs to diffuse best-practice technologies broadly to small and medium-sized firms. Other activities are more focused on technologies of
interest to particular industrial sectors, where industry leaders see a clear need for cooperation with government R&D to solve technology problems.
These include: the Partnership for a Next Generation Vehicle, the National Electronics Manufacturing Initiative, and the Building and
In addition, the Advanced Technology Program (ATP) is an industry-led, cost-shared, merit-based partnership program that supports a
range of technologies relevant to the health and growth of several important industrial sectors, including those that are the focus of CCIT
initiatives. The Technology Reinvestment Project (TRP) also relies on industry leadership, cost sharing, and competitive selection in a
partnership aimed at making the most advanced and affordable commercial technologies available to the military. Both ATP and TRP are
high-priority programs for the Clinton Administration.
CCIT also joins with other NSTC Committees in coordinating activities that cut across several committee responsibilities,
including environmental technologies, biotechnologies, and dual-use technologies that have important applications in both military and civilian
Government partnerships with industry for technology advance are of course just one element in what is needed for the United States
to take and hold world leadership in important industries that add to the national wealth, create good jobs, and enrich our lives.
The "environment conducive to private investment," alluded to above, includes some overarching policy areas. At the top of the list
is reduction of the federal deficit, so that massive government borrowing does not push up the cost of capital and crowd out private
investment. Other important elements are tax policies with appropriate incentives for private investment; trade and export policies that open
foreign markets to U.S. goods; and regulation by performance, not prescription, for protecting public health and the environment. The Clinton
Administration has accomplished a great deal in these areas, but significant challenges still lie ahead.
Equally important is first-class education that challenges and rewards all our children, and lifelong learning opportunities for
adults. Although these activities are outside the scope of CCIT (they are covered in the NSTC Committee on Education and Training),
they are closely linked to the success of civilian industrial technology efforts. The Clinton Administration has made strides in this direction;
e.g., in the School-to-Work Transition program, for young people who do not choose a straight path to college. Clearly, however, further
progress is needed toward world-class education and training in the United States. New, more collaborative approaches can contribute to the
adoption of new technologies. In addition to training workers to use and operate new technologies, industry should involve workers in
new technology design, purchasing, and the integration of technologies into innovative work systems. These are major challenges for
improving competitiveness, and bringing home to all Americans the benefits of technology advance.
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