According to the Newsweek-Intel Global Innovation survey, 78 percent of Americans say “yes.”
Thirty years ago, the United States was nearing the end of the race for political, military, economic and technological domination with the Soviet Union. But more than that, the United States was an agent of rescue for much of the world in the throes of a decades-long recovery from World War II.
It is in part because of the Cold War that innovation flourished in the United States well into the ’80s. Indeed, according to Newsweek columnist Fareed Zakaria, “after World War II, the Cold War drove (government funding for R&D) to new highs, so that by the 1950s, the United States was spending 3 percent of GDP on R&D, which amounted to a majority of the total spending on science on the planet.
“Government funding of basic research has been astonishingly productive. Over the past five decades, it has led to the development of the Internet, lasers, global positioning satellites, magnetic resonance imaging, DNA sequencing and hundreds of other technologies.”
Therefore, it could be argued that innovation was equally important to the U.S. economy in 1980 as it is today, because, although the challenges we faced 30 years ago might seem dated today, at the time, were critical to U.S. success.
However, the Cold War eventually ended, and according to Zakaria, U.S. R&D spending fell by 40 percent while countries in the rest of the world quickly narrowed the gap.
Japan successfully disrupted the U.S. auto and electronics industries with Sony and Toyota in the ’50s, ’60s and ’70s. China has actually seen three decades of economic growth. And South Korea’s Electronics & Telecommunications Research Institute just beat out the U.S. Navy for value and sheer volume of its patents.
Today’s competition is simply more complex than it was 30 years ago. There are more players and new, multifaceted challenges. “The space race was basically a dual between two countries,” Intel Corporation Vice President and Chief Technology Officer Josh Rattner said in a HuffingtonPost.com article about the Newsweek-Intel survey. “Now we are engaged in a truly global competition over who will have the best ideas and who will turn those ideas into products, services and high-paying jobs.”
These things are of utmost importance to any nation’s economy.
As Zakaria said, “we cannot stop the world from rising and doing better at innovation, nor should we want to do so: the rise of the rest is a powerful, positive phenomenon for everyone. But America must adapt to it, not watch quietly as a spectator.
“For the past three decades, funding for science research has slipped, the education system has continued to decline and immigration policy has become less and less rational. Tax and regulatory policies have been made with more thought to domestic special interests that America’s long-term competition.”
Therefore, in order to get the U.S. economy back on track, innovation will be more important in the next three decades that it was in the last three.
– Stephanie
What do you think? Will innovation be more important to the U.S. economy in the next three decades than it was in the last three?
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3 responses so far ↓
Innovation will be more important to the US economy than ever before for several reasons. First, in an era of globalization, someone else will always find a way to produce a good or service at less cost. Cost leadership is a rush to the bottom. Second, the level of scientific and engineering skill is broadly distributed, so good products and technologies can be sourced almost anywhere. Third, access to broadband and computing power is rising rapidly, so there are few barriers to accessing a lot of information and computing power. This means that the barriers to entry are relatively low in almost any industry. But our differentiator can be, and will be that we recognize and capture the ideas and imagination of our people better than any other country, and our economy and rewards systems encourage entrepreneurs and innovators.
Hi Jeffrey,
Thank you so much for your comment! You bring up a great point. It doesn’t matter how important innovation is if we can’t capture ideas and imagination and convert them into valuable solutions for our challenges.
Hi Jeff,
Education is a building block for this generation. Coming from a very progressive school system years ago, which introduced \new math,\ they are ahead already with a new science and math university building and enticing students to enter for a five year masters program.
Entreprenurial minds grasp an idea, however, it takes more than an idea to make a business a success. Global competition is moving the supply chain with big box stores for cost effective savings. With great products selected through mom and pops with individual service, a community store can still do more than survive and continue to create a unique thriving city, or town. Creative minds, thinking outside the box can be innovative in various sizes of business. We must protect the small and mid sized business owners through our local government, state, and chambers of commerce. Our exports are growing with better products. The most recent innovation I have seen is the new ad for made in China. Does anyone know the new ad, it is factual!