As Congress and the American people wonder out loud about the proper way to restore American prosperity and global competitiveness, a growing chorus of industry experts and influential journalists is embracing innovation economics, calling for a reinvigorated national economic policy founded upon research, education, and manufacturing. Fareed Zakaria of TIME Magazine added his considerable microphone to the cause in his column yesterday, reminding readers of the role of technological and commercial innovation in American economic history:
The ecosystem that encourages technological breakthroughs and their application does not develop in a vacuum. It requires great universities, vibrant companies that devote time and energy to research and — yes — large amounts of government funding. The latter may be a controversial topic in theory, but in practice, the rise of technology was clearly fueled by government.
In the rest of the world, the role of the state is not controversial. While Americans continue to debate whether government should have any role in fostering innovation, the fastest-growing economies are all busy using government policy to establish commanding leads in one industry after another. Google’s [Eric] Schmidt points out that “the fact of the matter is, other countries are putting a lot more money into nurturing new industries than we are, and we are not going to win unless we do something like what they’re doing.”
Zakaria cites a report by the Breakthrough Institute to demonstrate the remarkable efficacy of government procurement in the technological innovation process. Following recent pronouncements from the likes of Vice President Joe Biden and Bill Gates, Mr. Zakaria is an encouraging addition to the campaign to renew American prosperity through innovation policies.