Sarah Sewall and Steve Bowsher
The current confluence of wars and geopolitical tension is acute, but it cannot distract the United States from the ongoing war in technology innovation. Jostling to lead transformative, over-the-horizon technologies is the geopolitical battle of the century. U.S. policymakers and private sector leaders face an uphill climb if they want the United States to win.
This competition may well determine whether democracies or authoritarian governments lead the global system.
The United States should never mimic the Chinese Communist Party’s centralized market, which often directs and funds nominally private entities. An effective U.S. government role in promoting innovation can only be limited in scope while strategic in purpose — and targeted toward the most transformative technologies.
Yet, our policymakers have, so far, failed to offer a national vision for how to sustain U.S. technology leadership.
Government once led the United States into global technology dominance. U.S. defense investments in a nascent microelectronics field enabled U.S. companies to lead the information technology revolution of the last century. Government’s catalytic role receded, though, replaced by faith in the private sector to lead future innovation. However, investors and companies frequently pursue the technologies that promise more immediate financial rewards, stranding higher-risk but potentially transformative technologies that lack a ready market.
China’s continued innovation progress has generated bipartisan alarm, and Congress has begun jump-starting federal support for key technologies. However, recent legislation addresses a host of competing goals, from securing supply chains, to greening the economy, to diversifying the technology workforce. The bills tackle just a few technologies, and they prioritize domestic manufacturing of existing products over future innovation. Consider the billions of dollars in new tax credits to build semiconductor facilities at home. It can take close to a decade just to build a fabrication plant, and many of these facilities will produce the chips of yesterday — not the future.
The United States must become more strategic in fueling innovation and helping the U.S. lead technology revolutions of the future. This means developing a national technology strategy. It must start with a comparative assessment of technologies with the most transformative national security or economic promise. It should include new tools that can advance key technologies beyond research and development into commercialization — even where the market demand remains premature. Many advanced democratic governments have national funds that invest in their companies to achieve national goals while providing returns to taxpayers when companies succeed. It’s long past the time that the United States began experimenting with this approach.
An engineer's gloved hand holds a semiconductor chip against a motherboard.
We’ve been tracking emerging global technology trends for some time, and if we were to pick a place for the U.S. to start investing, we recommend bioengineering. The field is poised for progress, thanks to new tools that allow us to decipher — and then rewrite — the code of life.
Bioengineering has the potential to create manufacturing for virtually every industry (mushrooms growing leather), adaptive forms of food and fertilizer (addressing future food scarcity) and even microbes engineered to eat pollution and poisons. For such reasons, as well as breakthroughs in medicines, China is already all-in on biotechnology, pumping tens of billions annually into not just research and development but also the nominally private companies that produce products.
Current U.S. private investment in bioengineering is driven largely by drug companies. Building effective platforms for experimentation and production demands large capital outlays, significant patience and high risk. Blockbuster drugs offer compelling incentives, but manufacturing, agricultural and related bioengineering applications currently lack the prospect of equally alluring financial returns. If bioengineering can deliver a fraction of its promise, U.S. government policies — such as encouraging development of production platforms that can help to reduce startup costs and reduce risk for early-stage private investment — could pay off handsomely for the national interest.
U.S. policymakers can, and should, experiment with new ways to harness the vibrancy of the entrepreneurial class toward over-the-horizon innovation that matters most. The government shares responsibility for enhancing the nation’s security and its power. Leadership of next-generation technologies is the new battlefield, and policymakers cannot neglect this long war amidst the press of current crises.
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