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What President Trump Could Do To Advance Innovation

2016 December 14
by Greg Satell

Donald Trump’s victory in the 2016 Presidential election stunned just about everybody, but especially those who are focused on innovation. CNBC reported that the mood in Silicon Valley was “like a funeral.” An article in the prestigious journal Nature called him “the first anti-science president we have ever had.”

It’s not hard to see why. The President-elect has questioned the science behind climate change, calling it “a hoax” and has been hostile to immigrants, many of whom are our best scientists and entrepreneurs. Even for a politician, Donald Trump seems wholly uninterested in science and technology.

Yet what he actually does remains unclear because, as an analysis by the Information Technology and Innovation Foundation observed, he has taken few positions related to innovation. Most probably, the real estate mogul hasn’t given the matter much thought. Still, if Donald Trump wants to support innovation in America, here’s what he should do.

Restore Basic Research

Since World War II, the United States has become a technological superpower. We dominate every advanced industry, from information technology to medical science. The vast majority of Nobel Prizes for physics, chemistry and medicine go to either Americans or scientists working here. When it comes to science and technology, we have no rival.

Yet what few realize is that most of the advancements start with funding from the federal government. To understand how pervasive and important this funding is, just look at an iPhone. Virtually every aspect, from the architecture and battery to the Internet and GPS, began as a federally funded program.

Over the past 30 years, federal investments in research have steadily declined, diminishing our ability to innovate. This is especially true of basic, exploratory research which the government is best equipped to pursue. As Vannevar Bush once put it, “There must be a stream of new scientific knowledge to turn the wheels of private and public enterprise.”

So the first step to advance innovation in America would be to restore funding for basic research to the levels they were at in the 1970’s. The costs wouldn’t be substantial —less than 0.5% of GDP — but the impact could be enormous.

Help To Overcome The “Valley of Death”

Clearly, basic research is absolutely essential to advancement. In the words of Nobel laureate George Smoot, “If we only did applied research, we would still be making better spears.” Yet still, innovation is never a single event. In order for a discovery to create an impact, it must be engineered into a viable solution and then applied to a particular industry or field.

Consider the case of electricity. The electric motor and the dynamo were discovered by Michael Faraday in the 1820’s and 30’s. Yet it wasn’t until 1874 that Thomas Edison set up the first the first electric power plant, Pearl Street Station and it still took another 40 years for electricity to have a significant economic impact.

On average, it takes about 30 years for a major new discovery to take its full effect. One reason for the lag is known as the “Valley of Death,” which is the gap between scientific discovery and the development of a viable commercial product that can compete with existing technologies on price, convenience and performance.

However, the federal government can play an important role in helping to narrow that gap. One successful program has been the Small Business Innovation Research (SBIR), which gives seed grants to help scientists and entrepreneurs develop a “proof of concept” and then funding up to a million dollars for projects that show promise.

The program has been enormously successful, helping to create companies like QualcommiRobot and Symantec. More recently, the National Science Foundation (NSF) began implementing Lean Startup methods to the SBIR program, which has significantly raised the success rate. Clearly, this is something we should be doing more of.

Build On The SEMATECH Model

Another promising example is SEMATECH, which established a partnership between government labs, academic institutions and semiconductor manufacturers to revive an industry being pummeled by cheap Japanese imports in the 1980’s. The federal commitment was only for five years, after which the industry players funded the program by themselves.

One advantage of the model is that it allows for tighter integration between the discoveries made in the labs and the needs of industry. Impressive scientific achievements don’t always translate to the marketplace, because of unforeseen problems with manufacturing, safety and cost. If industrial firms can alert scientists to these problems sooner, they can shift their energies to more fruitful paths.

Today, it’s clear that SEMATECH has been a resounding success. 11 out of the top 20 semiconductor manufacturers are American.The model has been expanded to programs that are creating a new breed of innovators, such as the JCESR program at Argonne National Laboratory that is building next generation batteries and the National Network for Manufacturing Innovation that is setting up manufacturing hubs around the country.

A recent article in Nature points out that the manufacturing hubs are especially effective in helping small firms to scale up and commercialize new technologies. “The overall goal should be regional innovation networks that draw from local universities, talent and resources to build new industries, expand manufacturing and create jobs,” the author writes.

So if President-elect Trump is serious about reviving American industry, these are programs that should be expanded.

Tackle Grand Challenges

In many ways, the stage was set for America’s technical dominance and prosperity in the 1950’s and 60’s. That’s when we unlocked the secrets of DNA, created the computer industry and sent a man to the moon. Those achievements reverberated for decades, creating entirely new industries and millions of jobs.

Today, we need to seek out new grand challenges, like sending astronauts to Mars, curing cancer, and moving to a zero carbon economy. Achievements like these are not only worthy in their own right, they will sow the seeds for our future prosperity. We can only win the future if we invest in it.

To take just one example, it has been estimated that the $3.8 billion invested in the Human Genome Project resulted in nearly $800 billion in economic impact and created over 300,000 jobs in just its first decade. The investments we make today can have a similar impact.

The truth is that the opportunities we have today in emerging new fields like genomics, nanotechnology and robotics dwarf anything that came before and America is in a position to take leadership in each one. However, opportunities are only valuable if you seize them.

– Greg

4 Responses
  1. December 18, 2016

    Thank you Greg. In fact, all that you suggest is in progress now. I am active with the Consumer Technology Association and we have already reached out with many of the same comments and suggestions (thanks for more ideas here too). While many may not be pleased with the outcome it is our imperative to do the best we can. We can hope that once in power the perspective changes. As you note, Mr. Trump really had no particular position in Tech, so it is up to all of us to try to inform, direct and shape good policy. Whatever you wanted, this is the reality but in fact government is made by many, not one person. So we must push ahead and meet. The power of citizens is much greater than most think. The Constitution specifically grants us all the right to petition our government and while it is often characterized by the term “lobbyist” this comes down to us as well. I, for one have gone to meet my congressmen and senators as well as many legislators from around the country. I have told them my views and shared facts with them. Some of them may resist. Some or many may be ill informed but I have seen effort make change. It was citizen power that defeated ill informed legislation on the Internet, and it is citizen power that can push the very initiatives you note. The issue is action. We cannot lay back or give up because our choice did not win, and even if they did we cannot assume they will act in the best way without input. Now is the time to engage while all the chairs are being shifted.
    What you propose is all good and important. I will keep talking and working, and hope all who read this do as well.

    Greg Satell Reply:

    Good for you Robert! Let’s keep pushing!

    – Greg

  2. Amber McKinnon permalink
    December 28, 2016

    Sorry Greg…if Nobel Prize your measure of American scientific success, in my opinion, it’s flawed when you consider women largely overlooked as recipients. Consider American Vera Rubin who chose her field because she was pushed out of more popular science arms in favour of less brilliant men. What did she do? Found a interest that so obscure that no one would bother her. She began counting stars, and some 200 galaxies thus determined a galaxy rotation problem that lead to theory and subsequently discovery of black matter. Vale Vera :))

    Greg Satell Reply:

    Well, as you noted, Vera Rubin is an American, so if anything, American success is undercounted.

    – Greg

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