THE EIGHT “Is” NEEDED TO WIN THE RACE
INSPIRATION: Setting Ambitious Goals
Inspiration can come from “stretch” goals, such as President Kennedy’s 1962 declaration that the United States would send a man to the moon by the end of that decade. Restoring U.S. innovation leadership is a far more complex and less tangible task than going to the moon, but the United States can and should set similarly audacious goals.
INTENTION: Make Innovation-Based Competitiveness a National Priority
When the United States feels its national security interests are threatened, there is bipartisan support for a massive response. The same should be true for our economic interests. We need our economic policy leaders to abandon the time-worn Washington Consensus and adopt an “Innovation Consensus” that focuses the United States on winning the race for global advantage with the pragmatism and ingenuity that led to success in the past.
INSIGHT: Improving Understanding of Innovation Performance
Policymakers need to better understand the nature of the challenges the United States economy faces and how to maximize its capabilities. We need much better information on our strengths, weaknesses, threats, and opportunities on the global innovation stage.
INCENTIVES: Encouraging Innovation, Production, and Jobs in the United States
Non-democratic nations can dictate private sector actions to spur innovation, but the United States cannot and should not. Instead, we should provide incentives such as lowering the effective corporate tax rate and expanding tax incentives to encourage R&D, training, and capital investment.
INVESTMENT: More Public Funding for Innovation and Productivity
Federal investment in the building blocks of innovation has been slipping for decades. The United States needs to provide significantly more support for research, commercialization, technology adoption, and education and training. Part of the increase should go to supporting scientific research, but a portion should also be earmarked for programs explicitly supporting industrial innovation and getting ideas from lab to market.
INSTITUTIONAL INNOVATION: Doing New Things in New Ways
To win the race, nations cannot be content with high rates of technical innovation alone. They also need high rates of organizational innovation. The United States must move beyond partisan gridlock and approach the task of institutional innovation (e.g., new ways of schooling) with the same urgency a corporation does when threatened by a competitor.
INFORMATION TECHNOLOGY TRANSFORMATION
One of the defining features of many of today’s innovations is their basis in information technologies—computers, software, and telecommunications. The United States does well in adopting IT within some fields, but not in others. We need a robust national strategy to advance widespread IT transformation.
INTERNATIONAL FRAMEWORK FOR INNOVATION
While the United States needs to step up its domestic innovation game, it also needs to fight more vigorously against foreign “innovation mercantilism.” The United States must stop turning a blind eye to countries’ policies and practices that violate global trade commitments and take the lead in insisting that our competitors play by the rules.