|
Technology Leadership to Strengthen Economic and National Security
This report reflects the deliberations of the drafting panel on Technology
Leadership to Strengthen Economic and National Security that met on March
30, 1995 during the Forum on the Role of Science and Technology in
Promoting National Security and Global Stability. The report was compiled
by the session drafter and is a summary of the issues raised during the
discussion. All points do not necessarily represent the views of all of
the participants.
- Drafter:
- Dr. John Alic,
Senior Associate,
Office of Technology Assessment,
Congress of the United States
- Co-Chairs:
- Government Co-chair:
- Dr. Dorothy Robyn,
Special Assistant to the President for Economic Policy,
National Economic Council
- Nongovernment Co-chair:
- Mr. Gary Denman,
Senior Vice President Strategic Planning,
GRC International
- Rapporteurs:
- Mr. Tom Arrison,
National Research Council
- Dr. Laura Efros,
Office of Science and Technology Policy
- Participants:
- Dr. James Bonomo,
Senior Scientist, Critical Technologies Institute
- Mr. William Bonvillian,
Legislative Director, Office of Senator Lieberman
- Dr. Marie-Louise Caravatti,
Technology Administration, U.S. Department of Commerce
- Dr. David B. Chang,
Director-- Technology Transfer, G.M. Hughes Electronics
- Prof. Stephen Cohen,
University of California-Berkeley
- Mr. John Coan,
Bureau of Export Administration, U.S. Department of Commerce
- Dr. Jay Davis,
Associate Director, Environmental Programs,
Lawrence Livermore Laboratory
- Mr. Steven Ebbin,
Vice President, Science and Technology,
Institute for International Education
- Dr. Carol Evans,
School of Foreign of Service, Georgetown University
- Ms. Katherine Gillman,
Special Assistant for Defense Conversion,
Office of Science and Technology Policy
- Mr. David Goldston,
Council on Competitiveness
- Mr. Everett D. Greinke,
Vice President, International Planning & Analysis Center
- Dr. George Hatsopoulos,
CEO & President, Thermo Electron Corporation
- Dr. Donald Hicks,
President, Hicks and Associates Inc.
- Dr. Mark B. Myers,
Senior Vice President, Xerox Corporation
- Admiral Marc Pelaez,
Chief of Naval Research, Office of Naval Research
Technology Leadership to Strengthen Economic Security and Competitiveness
--Summary of Drafting Panel Discussion--
Summary:
The drafting panel's response to the three crosscutting questions can be
summarized as follows:
- The obstacles to more effective deployment of technology in support
of economic and national security are systemic. Large parts of the
nation's Cold War science and technology system need to be redirected and
revitalized. Government, industry, and the universities all in various
ways are struggling, in a climate of financial stringency, to redefine
their roles, responsibilities, and missions.
- In addition to funding basic research, the Federal Government has a
critical role in supporting "mid-range" R&D, e.g. with time horizons in
the 5-7 year range. Although mid-range R&D is vital for creating new
markets and businesses, financing constraints mean that American companies
often cannot pursue such projects on their own.
- International diffusion of science and technology is much faster today
than in the earlier post-World War II years. While taking steps wherever
practical to safeguard U.S. technological leadership, one of the pressing
needs for the United States is to accelerate inward flows of science and
particularly technology from abroad. U.S. leadership in a major
international effort to develop and implement clean manufacturing
technologies could provide a vehicle for encouraging cooperative efforts
while at the same time attacking a problem of worldwide importance.
What Has Changed?
From World War II until the end of the Cold War, national security
provided the underlying rationale for much of the U.S. science and
technology (S&T) system. The three major parties to the system --
government, industry, the universities -- grew into their respective roles
based on a widely-accepted social compact. Government funded basic
research and mission-related technology development. Industry conducted
R&D with its own as well as government funding, building defense systems
and supporting the U.S. venture into space, while at the same time
spinning off technologies with commercial potential. Universities
conducted research and trained the people who made the S&T system
function. That system, and the social compact that supported it, is now
under stress almost across the board.
During the Cold War, basic and applied research sponsored by the
Department of Defense (DoD) laid the foundations for technological
superiority in weapons systems. Geopolitical objectives more than science
drove the nation's space program. A broad-based national commitment to
improve health care through investments in medical technology ensured
support for the life sciences. Today, three of the five largest R&D
funding agencies -- DoD, the Department of Energy (DOE), and the National
Aeronautics and Space Administration -- find their missions in flux and
their R&D budgets under pressure. For the National Institutes of Health
and the National Science Foundation, growth in funding has slowed even as
the research communities they support continue to expand. Meanwhile, the
Department of Commerce has been carving out a new mission in support of
R&D related to the needs of industry.
For several decades after 1945, university research grew rapidly and
steadily, fueled by Federal funding. Doctoral enrollments increased,
along with the ranks of postdoctoral researchers. Foreign nationals
flocked to the United States to study with the best and the brightest
among our science and engineering faculties. Much of the university
portion of the S&T system continued to follow an expansionary course even
as opportunities began to dry up.
U.S.-based industrial firms, without peer in the early postwar years,
pursued research in their own interests and, with government funding, in
the national interest. For more than two decades, military technologies
continued to lead civilian. American companies were able to take
advantage of waves of innovation associated with aerospace technologies,
with computers and microelectronics, and later with biotechnology. They
established commercial leads that in some cases still persist. Today,
however, military technologies, with some exceptions, are as likely to lag
as to lead commercial technologies: spin-on coexists with spin-off, while
the defense technology base has been contracting relative to the
commercial technology base.
The larger context for these shifts includes a relatively open
international economy in which technical knowledge and skills, as well as
business and managerial expertise, diffuse rapidly and have become more
widely distributed across countries. Today, U.S.-based corporations face
highly competent overseas rivals, many of which have moved steadily upward
into high technology -- often with the aid of know-how originating in the
United States. It has become harder for American firms to create and
maintain technologically-based advantages than in past decades, when they
started off farther ahead and the competencies of foreign firms were
generally inferior. In a climate of intense competition, fostered by
downsizing in defense, deregulation (e.g., in telecommunications), and
"globalization" (associated especially with the growth of multinationals),
managers feel even more constrained than in the past by the need to focus
internally-funded R&D on near-term business objectives. Even the biggest
and wealthiest firms have pulled back from long-term, high-risk R&D, in
part because of financial market pressures generated at least in part by
institutional investors.
Of course, the picture is not all dark. The United States remains
ahead in many fields of science and technology, although not so far ahead
as in the past. U.S.-based firms have rebuilt their competitiveness in a
number of industries over the past decade (albeit with the help of a
depreciating dollar and economic distress in Japan, both reversible
conditions). International competition has been a powerful stimulus for
improvement in sectors like autos and electronics, while, to take another
example, inflows of capital and know-how from Japan helped the steel
industry.
It becomes clearer year by year that technology is truly the
engine of economic growth. But it is not nearly so plain as two decades
ago that the nation's S&T system is working well enough to keep U.S.
levels of productivity and prosperity the highest in the world. The
dangers associated with uncertainty and lack of direction in S&T policy
include underinvestment in technologies that could underpin future
generations of defense systems, as well as lagging commercialization of
technologies resulting from U.S. investments in fundamental research. The
pervasive sense of anxiety expressed in various ways by so many Americans
over the last few years reflects fears that the United States may not be
well prepared for the future.
The Roles of Government, Industry, and Universities
The drafting group believes that the roles of industry and the
universities in the U.S. S&T system remain reasonably well-defined and
well-accepted. Industry has the job of product and process development,
of commercialization. Universities, alongside their primary function of
education and training, share responsibility for research. But the role
of government remains unsettled, particularly given budgetary pressures
which some believe may soon cut deeply and dangerously into support for
longer-term research and generic technology development (in both of which
industry underinvests by definition).
The wellsprings of innovation in the United States have not dried
up. But they are threatened. (This is one reason why "critical
technologies" have drawn so much attention in recent years.) Absent a
superpower rival as strong in science and technology as the Soviet Union,
DoD may pull back from at least some of the long-term R&D that it once
pursued as insurance against technological surprise. Dual use and
spin-on, laudable objectives as they may be, will rarely push the
frontiers (TRP, for example, supports relatively mature technologies).
Universities, trying to diversify their sources of support, will in some
cases be drawn away from basic research into more applied work for
industry and in other cases may be forced to retrench. The national
laboratories, particularly those of DOE, struggling to find new missions
and justify their budgets, run the risk, like at least some universities,
of losing their sense of direction. Companies large and small, with
narrowing profit margins, will make conservative R&D choices.
The problem is not only one of preserving the kind of longer-term
R&D that leads to breakthroughs. In the new international economy,
deployment and commercialization have become pressing concerns for U.S.
industry. For the drafting group, "mid-range" or "middle-ground" R&D
emerged as a primary concern. Often the source of fundamentally new
products and processes -- and sometimes new businesses, indeed new
industries -- mid-range R&D is hard for industry to finance, yet it rarely
can be construed as basic research, and therefore tends to be
inappropriate for university or government laboratories. The drafting
group found it useful to think of this category of projects as centering
on time horizons of 5 to 7 years, keeping in mind that some fundamentally
new technologies reach the marketplace much more quickly (perhaps as
little as two years in fast-moving fields like computer software or
catalysis) while others may take a decade or more to come to fruition.
From a national perspective, the need is to maintain a
sufficiently large and diversified portfolio of mid-range projects, R&D
that would be starved for support without government funding. Some of
these projects will pay off quickly; others may not pay off at all. Joint
government-industry funding can extend time horizons, increase the number
of riskier projects in the national portfolio, and fill the gaps that
inevitably open from time to time in any S&T system as complex and dynamic
as that of the United States. Thus the drafting group believes that the
Federal Government should continue to seek new mechanisms for selectively
diversifying the nation's R&D portfolio, with particular attention to
mid-range R&D needs that might otherwise go unmet.
Obstacles
Systemic obstacles to more effective utilization of technology and
science break down into two categories, the first associated with the end
of the Cold War, the second with financial constraints. U.S. S&T policy
is in a period of transition. Existing structures, many put in place in
the 1950s, must be re-examined. Some may need to be rebuilt, others
replaced.
Lack of consensus on the appropriate role for government in
support of new technologies (not just science) has made it difficult to
"reinvent" U.S. technology policy. Nothing illustrates this better than
the ongoing debate over the future of the federal laboratories,
particularly those of DOE. Any view of the appropriate role and mission
for the laboratories will depend on one's view of the remainder of the S&T
system; the question is not the future of the laboratories in isolation,
but their future as part of the larger system.
Financial constraints affect all three major parties to the S&T
system. That system, after growing for decades, has not yet adjusted to
an era of limits, one in which rates of growth of R&D spending even in
good years promise to be low by historical standards. Adjustment will be
especially difficult for universities and federal laboratories, which have
less flexibility than industry.
None of the three parties can look back and find in the pre-World
War II world solutions that will work for the future. In the past, the
competitive environment for industry was slow-moving compared to today,
far less demanding technologically. University research, supported until
the war in large part by foundations, was small in scale, science still
something of an avocation; much of the government's research support went
to agriculture. In such a world it may have made sense for government to
leave technology to industry. But that world is gone for good. Reshaping
U.S. S&T policies to suit the post-Cold War environment means nothing less
than a new social compact among government, business, and the
universities.
International Cooperation and Competition
The United States has less experience with international
cooperation in technology than in science. The drafting group stresses
the permeability of national borders to flows of technology and the
inability of governments to control those flows. This means that the
United States must remain aware of the potential costs of outflows of
critical technology while at the same time enhancing inflows. The
innovations associated with Japanese production systems, for example, have
been beneficial to the United States but were quite slow to take root
here.
The argument for international cooperation on generic or
infrastructural technologies -- where society stands to benefit but
companies may fail to invest for fear they will be unable to capture the
returns -- parallels that for domestic cooperation. In this light, the
drafting group suggests that the United States take the lead in a major
international technology cooperation effort -- for example, to develop and
diffuse improved technologies for environmentally friendly or "green"
manufacturing technologies. Such an undertaking could focus on process
technologies for industries with high environmental impacts, such as
chemicals or primary metals, where individual firms may have little to
gain by way of marketplace advantages and where overlap and duplication
drive up total costs. There is much the United States could learn, and
much the United States could contribute, by leading such an initiative.
[Back to previous level]
President and First Lady | Vice President and Mrs. Gore Record of Progress | The Briefing Room Gateway to Government | Contacting the White House White House for Kids | White House History White House Tours | Help | Text Only Privacy Statement | |