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August 21, 2013 9:38 AM Demythologizing Innovation

By Ed Kilgore

At TNR today, John Judis launches an attack on one of the reigning myths of conservative politics, the assumption that government interference in the economy is inhibiting the brilliant and noble contributions of entrepreneurs. In the world of technology, at least, Judis notes, much of America’s preeminence would never had occurred without the kind of federal investments in science and research, and in some cases, direct partnerships, that Republicans used to support but now deplore.

Many people still cling to the idea that government is, without exception, a drag upon the private economy. Conservatives “know that when it comes to economic progress,” Arthur Brooks, the president of the American Enterprise Institute, wrote last year in National Review, “the best government philosophy is one that starts every day with the question, ‘What can we do today to get out of Americans’ way?’ ” They imagine the United States as a land of plucky inventor-entrepreneurs (“We built it!” they cry) who work out of garages and depend solely on their wits. The problem is that this vision of American inventiveness is pure myth.
Steve Jobs, who has nearly been beatified in his role as independent businessman, excelled at designing products based on government-funded inventions. Some of Apple’s most vaunted achievements—the mouse, a graphical user interface, the touch-screen, even Siri—were all developed in part with federal finances. Or take Google. Its search engine came out of a $4.5 million digital-libraries research grant from the National Science Foundation (NSF). You can also look at the pharmaceutical industry. According to a Congressional Budget Office study, 16 of the 21 “most influential drugs” introduced between 1965 and 1992 depended on federally funded research.
The list goes on. Federal money helped support the invention of lasers, transistors, semiconductors, microwave ovens, communication satellites, cellular technology, and the Internet. Now, the feds are prime backers of the Human Genome Project (which could transform medicine) and nanotechnology (which could transform manufacturing). Subtract these kinds of innovations from America’s future, and you have an economy dependent on tourism, the tottering superstructure of big finance, and the export of raw materials and farm products. More to the point, you have a weaker country—not just in comparison with its competitors, but also in its ability to provide its citizens with richer, longer, more imaginative lives.

As Judis explains, in promoting a robust federal R&D budget, and a particular focus on manufacturing technology, the president is building on an old bipartisan tradition that was embraced especially by Ronald Reagan. But GOP support has all but vanished now, and along with it, support from the big business lobbies, who dare not break with the conservative movement:

In March 2012, Obama unveiled a plan for a National Network for Manufacturing Innovation, which would set up regional institutes that bring together scientists, engineers, and business and labor leaders to devise new manufacturing technologies. A pilot center, initiated in Youngstown, Ohio, last August, is focused on 3-D printing. This year, Obama requested a billion dollars for it in his 2014 budget, but he probably won’t get it. “The thought was there, but the will isn’t there because of Republican opposition,” says David Hart, a professor at George Mason who served as assistant director of innovation policy at the White House Office of Science and Technology Policy for the last two years.
Some industries do support the administration’s innovation strategy, but two of the most influential business groups, the Chamber of Commerce and the National Association of Manufacturers (NAM), have proved difficult to persuade, even though their members could end up benefiting hugely. The Chamber of Commerce backed Sematech and Small Business Innovation Research grants under Reagan, but since 1994, it has staked its clout on an alliance with Republican congressional leaders. The organization is unmovable. That’s why negotiations with NAM, which isn’t quite as hard-line conservative as the Chamber, have proved doubly frustrating. Hart remembers being faced with a catch-22: The White House needed NAM to get Republican congressmen on board, but “they said they needed the Republicans to support the policies” before they’d lobby for them in the first place. This April, NAM did come out for the “concept” of the White House plan but said it remained “concerned about where the money is found to fund it.”

So instead of moving ahead with a 21st century strategy for innovation, it looks more likely that Congress won’t even protect science and technology programs from additional sequestrations. They’ve already been cut 13% in the last two years. The opportunity costs are difficult to calculate, but easy to imagine.

Ed Kilgore is a contributing writer to the Washington Monthly. He is managing editor for The Democratic Strategist and a senior fellow at the Progressive Policy Institute. Find him on Twitter: @ed_kilgore.

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