One example is our lack of leadership in broadband communications, including wireless. Market pressures have led the US industry to be very short term focused, and fall behind the EU and some Asian countries in broadband penetration and advanced wireless services. There are other examples.

A program to improve that situation such as the broaband initiative in the recovery plan is of value, if implemented right. Other technology related investments will also be useful, such as additional funding for researchers and the NSF.

But there’s more that’s needed. It is the transition from science to technology and applications that detemrines whether soemthing has value. Pilot programs in various areas can be a great way to do this, as well as the creation of various S&T initiatives to help industry make those leaps by demonstrating the viability of soem of those technologies and setting some of the infrastructure in place. Incentives to industry with higher R&D tax incentives can also help, if those are structured to incentivize R&D beyond that currentlt done, ie, not to serve to finance existing R&D but new.

There was an article or editorial in the Washington Post a few days ago arguing that what is needed is more engineering, that science is not the way to develop the technoloy and applications. On Sunday Febr. 1 there were two letters to the editors, basically saying that it is the combination of science and engineering that does the trick. It is in fact well known in the S&T and R&D world that both are needed, and that scince withoiut engineering leads to laboratory curiosities that go nowhere, or are exploited by a competitor, and that engineering without science quickly dries up. The US has been generous in the past in funding basic research, with applied research and development only funded for defense purposes.

It is time to fund on the basis of what the S&T management community and practitioners knows works: a hybrid model that funds research and some early development, pre-competitive, that develops the S&T, and is completed through demonstrates in pilot programs the viability of the technology. There are many ways to do this. One way is a commerical ARPA. DARPA in DOD has been a great model and incubator for innovative defense technolgies (and by the way the creator of the Internet). This, and other approaches for S&T investments is needed to stimulate the new innovation process.

This is not to say that industry should not be incentivized to invest as well. But their models for R&D have suffered in the last 30 plus years due to the very short term financial focus of the markets. Patient investment can help, and Gov’t programs or incentives, or subsidies, in certain areas of S&T, can make a difference.

One way is to invest or incentivize in some major areas in S&T, such as those related to renewable energy and energy efficient transportation transportation as the administration will do. Broadband is also a good place, to establish faster pipes for our information-based economy. There are other areas, and possibly a Commerce-led agency charged with medium to long term innovations invetments, along with a commercial ARPA, can be a way for the Gov’t to identify and fund promising areas for innovation.

I applaud the intent of measures like the America Competes Act and the Bill discussed above. However I want to call to your attention to longstanding problems with the “linear theory of basic research” that was embedded in the NSF Act of 1950 and continues to have influence in the above legislation. The linear theory assumed that basic research would spawn useful spinoff innovation and other benefits to society.

However, as summarized with considerable documentation in Chapter 2 of my book, due for release this month,(www.springer.com/economics/environmental/book/978-0-387-75876-3) investment in basic research has yielded consistently disappointing practical results over the years. Exceptions occur primarily in medical and pharmaceutical research. It also had other insidious damaging effects.

competitive awards for discretionary research, supported by federal dollars, conveyed prestige. Combined with other external support for growth, a system of largely self-contained and peer-controlled research was nurtured in U.S. academic institutions. Voluminous research publication was directed into peer-reviewed specialty journals and books that served increasingly fragmented subdisciplines.

A corollary effect of conferring the highest status to basic research was that applied research and development acquired second-class status – something of a stigma. Much of the nation’s best science talent became recruited into the ivory tower, where it remained largely isolated from the practical life of the nation (even if the subject of research was related to national needs)

The problem has long been known. It was described with often caustic humor in many articles and two books over decades by the distinguished science policy editor for Science Magazine, Daniel S. Greenberg. However, because of its sensitivity with respect to academic funding, the problem, if mentioned, tended to be couched in academese.

If you’re not familiar with this issue, I can offer a striking illustration of the problem. Since the 1960s the U.S. has maintained significant dominance of basic over applied research investment, along with increasing total outlays with time. During the same time period it has suffered disproportionate loss of industrial capacity and productivity, including many of the industries that it created or pioneered in.

In contrast, Japan chose the opposite research policy, funding almost only applied research until recently. Yet, from a GDP per capita a quarter of that of the U.S in 1964, by 1986 Japan actually passed the U.S. in GDP per capita. Thereafter, it fell back owing to its massive banking problems for more than a decade.

In short, the U.S. has enormous output of paper productivity, planning efforts, endless hype in magazines and various formal documents. Google Scholar lists 35,000 conferences with the theme of GLOBAL WARMING but with with little technological action to show. Last February the DOE abamdoned our sole demonstration project for CSS, Futuregen, after six years of research, talk, and hype. we In contrast, with very little talk the Canadians implemented the world’s largest carbon sequestration project in two years – taking CO2 from a coal gasification project in Wyoming. The Canadian government provided no direct initial research subsidies. no initial direct government outlays.

Cordial regards, Frank

Can you train innovators? How can you teach what, by definition, is not known!

I am very, vary, impressed by your “out reach” efforts.
Whether you read or use parts from whatever is written is not as important as the personal feeling that
at least we tried to respond and participate.

Of course, you cannot read everything and certainly you cannot agree will all the pro and con statements you get
but I thank you for your efforts at advancing the degree of participation, see? It is not thankless effort, I thank you.

There is one issue where I think you missed the mark:
“Building Innovation Centers” is like building Temples to the God of Staffing.
If it was a good idea, why is it that only the Soviet tried it?

Personally, many innovators claim that it was the “challenge” that motivated them.
Edison, some say, was his persitance until he found the metal needed. No great analysis, just a great amount of work.
Could DoD ever produce a Microsoft or Intel Companies? I do not think so.

NACA/NASA is, by far, the most technically innovative organization and, you can get great testimonials for them, form each and all the Airplane Companies -even foreign.
But, it never tried to build a bomber or a passenger plane.
The atomic development efforts are not cost-effective, at all.

Look at the way USAF used the “Skunk Works”, well, you look at it, it is all classified, except it was run by Lockheed, probably in cost-plus basis. This is not a practical example of developing commercial products.

But, there is a model used by DARPA and X-Prize, very effectively, to develop new innovations at a very low cost.
Their approach was to provide incentives by using contests and cash prices..

The X-Prize has its goal to deliver cargo in orbit at a tenth, or less, the prize of NASA. They will soon go to the Next Step, not the final but the next.
To my knowledge, the cash reward to the winner is provided from private funds. One major contributor was a co-founder of Microsoft.
Another example is the Google efforts to send something to the moon.
Google is paying for a medium altitude satellite network to bring the Internet to the rest of the world,
to the other 3 Billion people, it is called O3B.
If the idea is good, smart business people do not wait.
Another example,
INTEL is building a network that will bring the Internet to people without land telephone lines using WiiFi
technology that has been around for 2 or 3 years and few have used it. It will revolutionize teaching, health care, etc.

So you have the failure of Novosibirsk and the success of X-Prize and DARPA.
I find it hard to believe that you have decided to follow the Soviet failure.
Remember, the Soviet had other failures, too long to list.

There is another failure worth paying attention: The Space Shuttle.
Its original goal was to REDUCE the cost of payload, per pound, in orbit by a factor of 100.
The final result produced an INCREASE on the cost of payload by a factor of 100, or much more (1000?).
NASA wisely dropped this dollar measure long ago.
No amount of money is too much for the first photo of the earth, from the moon. Or, the photo of the Brazilian rainforest, with 2,000 forest fires visible from orbit.

The historical evidence is that contests to deal with new problems are cost-effective.

————————————
A practical way to put a lot of people to work within a couple of months:
Issue Coupons redeemable to pay part of the cost of a car. You may want to use an scale to give more rewards to Electric Plug-In cars.
Also, you may want to assign a substantial payment for cars with high fuel efficiency, etc.
Support for hybrids and, even, natural gas, and whatever else, would get much support now and benefits later. You already probably have the analysts that can provide the numbers.

If the results exceed your expectations, you can expand the Coupons to buy other products.
The initial test could be for 100,000 coupons and you would want to know how fast they are redeemed.

Verified and redeemed, there are too many out to make a quick buck by buying with coupon and selling in the market.

An announcement that only a limited number of coupons would be available, say 3 million, would help expedite sales and production and keep foreign carmakers unruffled.

Also, there is no reason to omit another coupon issue for trucks, vans, trolleys, busses, etc.
And another for equipment for hospitals, transit, construction, etc., etc.
This was the original concept of “PUMP PRIMING”, enough coupons to promote early production, with an small amount of funds (water) and
smart economists to determine future steps and even optimize the cash amount and coupon number.

The final goal is to stop giving, after full and proper verification, more coupons.

—————————
I find it hard to speak out against Innovation centers but
perhaps you might wonder how would Beethoven, Einstein and Von Braun, in modern American clothes, fit into your plans.
I spent all my life involved in innovation.

In my opinion, the computer power is growing far faster than the software that could allow them do other jobs.
Computer technology is underutilized.
But, can you imagine an innovation center for the production of new software, that is not in competition with a dozen commercial companies, like IBM?
(my nephew does that for them).

Einstein produced most of his work while working for the Berlin post office.
Some say he produced almost nothing in his last 45 years.
Are you willing to fire somebody because they have not invented anything for five years?
Could you get anyone that thinks themselves qualified to join under such conditions.

My guess is that it is possible that what killed Novosibirsk was the high costs and little benefits.
Remember, many inventors produced only one thing worth remembering in their entire life.
The idea that one can plan on developing what does not exist is, at least, illogical.
Do reconsider. Great innovators were great at reconsidering and improving projects, over and over.
Good Luck!
You ARE doing a terrific job!