Robert Reich: Whose Competitive Edge?

[David Farber <dave () farber net>]

Begin forwarded message:

From: John Lyon <jelyon () jelyon com>
Date: August 21, 2006 10:12:29 AM EDT
To: "dave () farber net" <dave () farber net>
Subject: Robert Reich: Whose Competitive Edge?

[For IP if appropriate]

<http://www.robertreich.org/reich/20060816.asp>

PUBLIC RADIO'S MARKETPLACE COMMENTARIES:
Whose Competitive Edge?
Robert B. Reich
Marketplace, August 16, 2006

A few months back, the National Academies, America’s leading science
advisory group, called for urgent efforts to strengthen the nation’s
scientific and engineering competitiveness. It cited numerous  
examples of
how we’re falling behind. Of 120 large chemical plants under  
construction
globally, for example, only one is in the United States US and fifty  
are in
China. China and India are producing more computer engineers and  
scientists
than we are. Indeed, some of the newest research labs in the world  
are now
in China. The panel’s leader, Norman R. Augustine, retired chairman of
Lockheed Martin, warned that "the building blocks of our economic  
leadership
are wearing away."

So the question has to be asked: Why aren’t American companies investing
more in cutting-edge science and engineering? Surely they can afford it.
These days they have more profits than they know what to do with.

It turns out American firms are investing lots in science and  
engineering.
The problem is, they’re doing less of it here in the United States  
and more
elsewhere, especially India and China.

Dow Chemical is building a research center in Shanghai that when  
completed
next year will employ hundreds of Chinese chemical engineers. A few  
months
ago IBM opened a software lab in Bangalore, India.

Last year, Microsoft announced a $1.7 billion investment in India  
over next
four years, about half for its research and development center in  
Hyderabad.
Its research center in Beijing recently beat out MIT and Stanford with
papers at a leading global software conference. Google’s Indian lab
spearheaded its new Google Finance software.

The list goes on.

Recently, the National Academies surveyed hundreds of 200 US and  
European
corporations and found over a third shifting more research and  
development
work to China and India. And most are decreasing research and  
development in
the US and Europe.

So when you hear America is in danger of losing its competitive edge,  
you’ve
got to ask yourself who "America" is. It’s not necessarily American- 
owned
companies. They’re not losing their edge. America and Americans are  
losing
our competitive edge.

Corporate executives may be personally concerned. For example, Dow
Chemical’s chief technology officer, William Banholzer, recently told  
the
New York Times he had a "personal worry" that loss of innovative  
science and
engineering work in America will hurt the United States." But Mr.  
Banholzer
conceded Dow itself had lots of options for doing research around the  
world.

Translated into political reality, this means American-based  
corporations
are not putting much pressure on Congress or the administration to  
beef up
American science and engineering. Yes, executives put their names on  
reports
that warn of the nation’s loss of competitiveness. But they aren’t  
lobbying
hard for better-funded graduate programs in science and engineering at
American universities, more and better-paid teachers of science and  
math in
American grade schools and high schools, or a requirement that the
research-and-development tax credit be used only for research and
development in the United States.

They aren’t pushing hard because they’re less and less dependent on  
America
and Americans for their research. Yet, in case you haven’t been paying
attention, American corporations dominate our politics. Without the
concerted push from American business, we – that is, we Americans –  
don’t
stand a chance of regaining our competitive edge.

--
John Lyon




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