Trump passes the baton of technological leadership to China
As featured in the Boston Globe | March 27, 2017
At the core of a country’s global competitiveness is its ability to innovate. As economist Joseph Schumpeter observed in his classic “Capitalism, Socialism, and Democracy,’’ capitalism is characterized by waves of “creative destruction,” in which advances in technology create new industries while destroying old ones. Yet President Trump is putting America’s capacity to innovate at the gravest risk in America’s modern history. His proposals are tantamount to passing the baton of global technology leadership to China.
Trump is playing out the game plan of the Republican far-right, led by the Koch brothers, to slash government programs in order to slash taxes. That’s true of the Obamacare overhaul (fortunately derailed, at least for now), and it’s also true regarding government programs to spur innovation. If enacted they will lead to a national calamity: the further disappearance of decent middle-class jobs.
In the first great phase of American industrialization, roughly from 1800 to 1950, America’s industrial success was mostly a matter of an expanding domestic market. Key infrastructure, such as the Erie Canal in the first half of the 19th century, and the intercontinental railway in the second half, created an enormous continental scale market for industrial goods. The process included the good (inventors such as Samuel Morse, Thomas Edison, and Alexander Bell), the bad (considerable theft of European technologies), and of course the horrendously ugly (slavery and the genocide of Native Americans).
World War II marked a pivotal transition in the nature of United States — and indeed, of global — innovation. The physical sciences and advanced engineering became far more central to the entire innovation process. And government became far more essential to advances of science and engineering.
Starting in the 1930s, with the mass influx of world-leading European scientists fleeing Hitler, the United States became the new global capital of cutting-edge science and technology. After World War II, the US military recruited scientists from the defeated Nazi regime as well, such as rocket scientist Werner van Braun.
Equally important, World War II fundamentally changed how technological innovation was pursued. Throughout the war, the US military worked closely with top scientists and private enterprises to develop new military technologies on a targeted and emergency basis. Countless areas of technology were radically advanced by directed efforts of government working with academia and industry. Such breakthroughs include radar, cybernetics (the beginnings of artificial intelligence and robotics), semiconductors and solid-state physics, computer science, targeted drug development (such as the new antimalarial chloroquine), aeronautics, telecommunications, and atomic energy.
This quintessential wartime innovation process came to be known as “directed technological change.” The military and scientists would interactively identify new technological possibilities and government would finance the requisite research and development. The most famous example is the Manhattan Project to develop the atomic bomb. There were many other, lesser-known, but momentous cases. And new materials developed for military technologies, such as semiconductor materials used for the new radar technology, became cornerstones of postwar industry. The breakthroughs in semiconductors, for example, became the basis for the invention of the transistor in 1947.
At the end of World War II, FDR’s science adviser, Vannevar Bush, wrote the visionary manifesto of the new era of innovation: “Science, The Endless Frontier.” Bush brilliantly envisioned, and helped to create, a new era in which government, academia, and industry would cocreate innovations based on advanced science and technology. Bush’s vision was motivated first by national security — the belief that America’s military predominance depended on American technological leadership — yet Bush aimed more generally to promote post-war American prosperity on the foundations of science-based industries.
America established a host of transformative institutions for science-based innovation, such as the National Science Foundation (1950), the National Institutes of Health (1948), the Defense Advanced Research Project Agency (DARPA, 1958) of the Department of Defense, the Atomic Energy Commission (1946), the National Aeronautics and Space Administration (NASA, 1948), and others. Regulated monopolies such as Bell Telephone also maintained cutting-edge research laboratories that funded and supported fundamental advances in science and technology.
In countless areas of modern life, directed technological change became the guiding force of postwar progress. Government and civil-society organizations (such as the Rockefeller Foundation in areas of public health and agriculture, and the March of Dimes, in the case of polio) would identify a cutting-edge opportunity. Scientific and engineering leaders in academia, national laboratories, and private industry would work together to chart possible pathways to success, and the government and foundations would fund the R&D and also support the subsequent diffusion of successful innovations. Thus, the March of Dimes, originally launched by FDR in 1938, funded Jonas Salk’s breakthrough research that produced the first successful polio vaccine, and the government then funded the vaccine’s rapid uptake.
In this way, government funding and leadership supported key advances in science and technology that could thereafter be scaled up by government and private industry. Successes included the moonshot; the rapid development of computer science; the invention of the Internet; advances in exploration and development of hydrocarbons (including hydrofracturing, or fracking); advances in crop breeding; the sequencing of the human genome; and more recently, self-driving vehicles championed by DARPA.
The close working relationship among government, academia, and business is the essence of directed technological change that has contributed in fundamental ways to America’s technological edge, global competitiveness, rising living standards, and national security. Budgetary requirements are often enormous — billions of dollars for early-stage R&D. The resulting national innovation system is complex, with crucial interactions across key stakeholders (academia and business, for example) over the course of a decade or two.
Advances in science and technology are hard won. Most importantly, government must be the champion of scientific truth over politics and must be ready to invest for the long run. Alas, these foundations for long-term innovation have deteriorated badly in recent years, and the Trump administration constitutes a new, unimaginable low point.
Trump and his cronies have their eyes narrowly and obsessively on two goals: deregulation and tax cuts, both of which work against long-term innovation. The relentless focus on tax cuts and deregulation is of course the libertarian agenda long championed by the Koch brothers and other dark money of the far right. It now threatens to kill the innovation system, given the dominance of the libertarian campaign financing of the Republican majority in Congress.
The result is a politics of lies and slashed budgets for federally funded R&D. Basic science — for example, the well-established science of climate change — is trashed in order to promote antiscientific environmental deregulation. And the budgets of the government’s key scientific agencies and laboratories are slashed to facilitate further tax cuts for the rich. In the process, the Republican Party has firmly become an antiscience party.
It’s striking how dramatically the situation has deteriorated, even when compared with the administration of George W. Bush, an administration that, like Trump’s, was also dominated by the oil and gas lobby. While the Bush administration rejected any meaningful policies to combat climate change, and parroted antiscience in the process, it did recognize the importance of science and technology for America’s long-term competitiveness.
The administration and Congress backed an important 2005 study, “Rising Above the Gathering Storm,’’ by the National Academy of Sciences. The report strongly endorsed federal funding of R&D, a welcoming environment for international researchers to work in the United States, and improved science and mathematics education at the K-12 levels in order to prepare young Americans for advanced studies in the sciences and engineering.
The opening words of the NAS study were striking and remain true today:
“The prosperity the United States enjoys today is due in no small part to investments the nation has made in research and development at universities, corporations, and national laboratories over the last 50 years. Recently, however, corporate, government, and national scientific and technical leaders have expressed concern that pressures on the science and technology enterprise could seriously erode this past success and jeopardize future US prosperity.”
The commission made four key recommendations. “Increase America’s talent pool by vastly improving K–12 science and mathematics education; sustain and strengthen the nation’s traditional commitment to long-term basic research; make the United States the most attractive setting in which to study and perform research; and ensure that the United States is the premier place in the world to innovate.”
These recommendations were broadly adopted in the America Competes Act of 2007, which established important new initiatives for federally funded research and development and support for education in STEM (science, technology, engineering, and mathematics). The legislation created the extremely important Advanced Research Project Agency in the Department of Energy to support R&D on cutting-edge energy technologies.
Now Trump is proposing to dismantle or degrade virtually every piece of the innovation system, at precisely the time that China is gearing up to develop preeminence in the critical technologies of the coming generation or two. First, Trump’s budget would eliminate ARPA-E and would slash federal outlays on biomedical research as well, cutting the annual budget for the National Institutes of Health from around $30 billion to $25 billion. The budget for the Department of Education is also sharply reduced, by around 13 percent, or $9 billion.
Second, Trump has begun to shut down the scientific capacity of US agencies to deal with environmental science and environmental crises such as climate change and pollution. Federal websites have gone silent on climate science; online data sets that were once available to the scientific community are being withdrawn; agencies have been put on warning against discussing climate change; and, of course, the proposed budget for the Environmental Protection Agency is slashed to the core, down by around 31 percent, including a cut, by around half, of the Office of Research and Development. All of this attack on federally supported R&D is of course gravely compounded by Trump’s owned antiscience rhetoric.
Third, Trump’s travel bans and general hostility to international partnerships and cooperation is already putting a severe chill on global scientific cooperation. It is no accident that American universities have lined up against the travel bans and have been plaintiffs to prevent their implementation.
What is so remarkable about all of this is that Trump is degrading America’s innovation system just as China is taking remarkably bold steps to upgrade its own innovation system and its leadership in cutting-edge technologies. China’s rate of patenting has soared in recent years, nearly catching up with the rate of US patent applications, and is on a path to overtake the United States in the near future. China is now producing more science and engineering PhDs than the United States. Yet perhaps most striking is China’s explicit commitment to technological advances in 10 critical sectors in the coming decade, part of a newly announced “Made in China 2025” program, including advanced information technology, new energy vehicles, including electric vehicles, low-carbon energy, and advanced medical sciences, among others.
America First is really Billionaires First and America last. The Trump-Koch-Republican alliance will gut America’s capacity to innovate if it gets its way. It is not surprising that a President with such contempt for the truth displays such contempt for science. Yet the rest of us should recognize that more fossil fuels, and yet another round of tax cuts for the rich, will not advance America’s well-being. It is especially urgent for us as citizens to resist Trump’s war on science.