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The Senate passage of the Republican- and Democrat-backed US Innovation and Competition Act (USICA) to the House with a vote of 68-32 recognizes fierce competition around the world, and particularly with China, for leadership in technology areas key. To this end, part of the bill is the Endless Frontier Act which would prioritize investments in key technology areas at the forefront of competition with China.
The potential for such a major national investment in resources and attention brings with it options and choices for policy makers to consider. For example, a quarter of a trillion dollars over a five-year period is a sizable investment of about $ 50 billion a year in new spending. But should this be accompanied by a company dedicated to doing research, development and innovation? The version approved by the Senate neither develops nor appoints one. The closest is the creation of an inter-agency working group led by the Office for Science and Technology Policy that would include the National Science Foundation, the Department of Energy, the Department of Commerce and other agencies needed to coordinate the implementation of the legislation and associated activities.
On the one hand, it may be appropriate for an organization to have responsibility for implementation and reporting, supervision and conflict resolution, analytical capacity and forecasting. But on the other hand, it is possible that a more directive approach to research, development and innovation could have the opposite effect to what the authors of the bills intended by stifling innovation and industrial capacity.
The increased competitiveness of the United States would also seem to imply the ability to conduct cutting-edge research in the highest quality facilities, a development that supports the maturation of technologies, successfully traverse the valley of death between development and commercial use activities and a industrial capacity to produce economically on a large scale. Each of these key components is well represented within the USICA, but there seems to be less focus on connective tissue or the relationships between them. How important will it be for the success of the effort that the links between each of them are well identified? These transition points between key components could be essential for the successful development and deployment of the technology.
Another option that policymakers may want to consider is the extent of investment in the ability to anticipate to perceive technological challenges and opportunities and make the appropriate changes. Suffice it to cite the examples of 5G semiconductor and communications manufacturing capabilities to highlight why an intelligence gathering and analysis capability and forecasting trends would be useful in this regard. These problems did not happen overnight. We have been watching them play out in slow motion for more than four decades in the case of microprocessors and for over five years in the case of 5G.
In both cases there were missteps and missed opportunities. Japan amassed nearly 80% market share of the global DRAM market with seven of the top 10 chip makers by the mid-1980s before the US took action. In 5G, the initial spectrum choice leads to a more expensive solution that would be less cost-effective and therefore less attractive for some nations to adopt. The recent reallocation of the military spectrum to consumer applications means that US companies will be able to develop more competitive 5G networks.
Given the need to make tough choices in this race to innovate and compete, an ability to make clear assessments, which normally focus on two or more competitors or opponents through a comparative process, could prove to be a useful option to consider. Net ratings strive to define and clarify options, help understand the relative merits of these options, and provide a basis for decision makers to make choices. In the 1970s, the Department of Defense used a net scoreboard to recommend ongoing funding of long-range bombers. The goal of the recommendation in this case was not for effectiveness, but rather that US investments in bombers would force the Soviet Union to spend more resources developing a modernized air defense system that they could not afford. Such a net valuation capacity could provide important insights into considering technologies for development. In the potential case of competition with China, it could provide a basis for technological development decisions based on other objectives, including, for example, confusing the decision-making process of competitors.
The nearly $ 10 billion over five years for university innovation institutes to conduct multidisciplinary and collaborative research relevant to key technological focus areas is recognition of the importance of investing in human capital for this innovation and competition effort. What options could be further developed to educate, attract and develop the next generation of scientists, technologists and engineers? Such a workforce must reflect the full range of American diversity and backgrounds.
Of course, the US faces a number of other technological and innovative competitors from a ledger security standpoint. In addition to China and North Korea’s nuclear and missile systems, there is Turkey’s integration of Russian-made air defense equipment into its forces, as well as Russia’s cyberattacks, to name a few. While USICA focuses on competing with China more generally, these additional arenas of competition are worth noting.
Daniel M. Gerstein works at the nonprofit and non-partisan RAND Corporation and previously held the position of Undersecretary (ad interim) and Deputy Undersecretary in the Department of Homeland Security Directorate of Science and Technology from 2011 to 2014.
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