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While missions are important, even more important are new institutions that will cut a path across them.
September 15, 2021
With Responses From
Sep 15, 2021
6 Min read time
Missions are important, but new institutions are even more so.
Mazzucato and her colleagues call for ambitious, “mission-oriented” industrial policy with system-wide, cross-sectoral investment in contrast to the narrower task of prioritizing a particular industry. A significant part of this effort involves investment in science and innovation. However, the U.S. science and innovation system already has extensive mission-orientation, which could easily support the examples of missions that Mazzucato offers. What we need in the United States, and around the world, are technology strategies across national objectives.
The U.S. science and innovation system already has extensive mission-orientation. What we need are technology strategies across national objectives.
Unlike firms, nations have multiple objectives: national security, economic prosperity (including jobs), and social welfare (including health, environment, and equity). In the past the United States has pursued the technological component of each objective through science and technology agencies with singular missions, such as defense, energy, transportation, commerce, and labor. The National Research Council beautifully describes how this mix of missions helped create the revolution in computing: “By funding a mix of work in universities and industry, [the United States] was able to marry long-term objectives to real-world problems. And, by channeling its funding through a variety of federal agencies, it was able to ensure broad-based coverage of many technological approaches and to address a range of technical problems.” Yet this excellent system has a hole: even if each agency (or program within an agency) perfectly fulfills its own narrowly specified mission, the country could still fail to fulfill the nation’s overarching multi-objective goal. In other words, the current system could put objectives such as national security, trade, and competitiveness with China into conflict with other significant objectives such as jobs and social welfare.
For example, if we just want to reduce carbon emissions, the best approach might be to scale up the use of electric vehicles as quickly as possible. However, if we expand the objective of that investment to also maximize national security, prosperity, and equity, we would need to find ways to quantify the value of domestic manufacturing of batteries, to predict which citizens would gain and lose jobs, and to consider how the shift in pollution sources from vehicles to energy generation sites (which tend to be located near poor communities) may decrease equity. Unfortunately, government today lacks the data and analytic capabilities to quantify these trade-offs, much less their potential effects on subsequent decisions (such as making it more cost-effective to locate manufacturing in the same location in the future).
To design a win-win system, we should neither change the basic structure of the agencies we already have nor impose top-down coordination. Indeed, scholars have long emphasized the importance of the diversity of the U.S. innovation system. Government reports with lists of critical technologies are unlikely to find their way into policy or action, or respond flexibly to the technical, political, and social realities on the ground.
To design a win-win system, we should neither change the basic structure of the agencies we already have nor impose top-down coordination.
Fortunately, if the right incentives are put in place, technology and investment can be designed to realize more than one objective. Achieving these strategic win-wins requires investing in interdisciplinary scholarship along with intellectual foundations, data, and analytic tools that can drive new paradigms of governance to incentivize technology investments that leverage synergies across national objectives.
For example, our work (with Christophe Combemale and colleagues) shows that not all technology leads to wage and skill polarization: technology solutions with different labor outcomes compete in today’s marketplace, but those with better operator and technician jobs for hardworking U.S. high-school graduates have better security implications in the long-term. I have also argued that building the infrastructure of the future not only holds potential to increase security, productivity (including through improved resiliency), and equity, but could also be leveraged to rebuild domestic manufacturing and increase the number of good jobs. The right program would be strategic about knowledge and human capital complementarities in investment choices and in creating demand, as well as in support for job transitions across sectors.
To design policies that realize a nation’s multiple objectives, scientists, engineers, and policymakers need both incentives to incorporate and transparency about how different technology and policy choices influence different objectives. To successfully execute this vision, we should create a small, nimble agency focused on national technology strategy that can seed fund initiatives independently but also work across, coordinate with, and catalyze initiatives within the existing mission-driven agencies. This approach will require an executive arm, an analyst arm, and an external expert advisory board housed within a single entity whose charge is to incentivize strategic technology investments that acknowledge and embrace all national objectives.
Here, public officials with embedded autonomy—deep knowledge of the technological, social, and industrial context—are most likely to get those choices right. Like the Defense Advanced Research Projects Agency (DARPA), the executive arm should have a staff of rotating program managers brought in from academia, industry, government, and nonprofits across a variety of relevant technical and social contexts. The analyst arm would provide transparency for policymakers, revealing the trade-offs of various technical investments in meeting potential national objectives (the value of those objectives different individual groups will weigh differently). The agency will need to develop new methods to assess our and other nations technology and production capabilities, and the implications of emerging technology directions for realizing the full set of our nation’s goals. Its analyst arm should have PhD-level experts in each technical field (75 percent of its experts), as well as PhD-level economists, political scientists, sociologists, psychologists, and historians focused on applying their expertise to real-world technology policy problems.
As the last seventy-five years show, without intervention, technology investments that increase security and competitiveness are as likely to reduce jobs and equity as to raise them.
Finally, an agency focused on national technology strategy needs enough money for its investments to be influential, but not so much that it doesn’t engage and influence efforts in other agencies to have a larger effect. I recommend $3.5 billion for external seed funding (DARPA’s annual budget), plus an operating budget to employ 100 program managers and approximately 100 analyst staff. For the program managers, the Semiconductor Research Corporation (SRC) offers an excellent example of how one entity with seed funding and political capital can amplify impact by bringing multiple funding agencies together around a common mission. Less well-known than SEMATECH (originally a 50-50 government-industry public-private partnership to promote equipment upgrading one to three years out), SRC is an industry-led public-private partnership that has, for decades, successfully ensured that academic research meets industry needs for continued computational advances three to seven years out. Unlike the mission-oriented SRC, however, an agency devoted to national technology strategy must catalyze a technology path that addresses holes and leverages complementarities across the nation’s full set of objectives.
Jobs and equity are as central to our sovereignty as national security. As the last seventy-five years show, without intervention, technology investments that increase security and competitiveness are as likely to reduce jobs and equity as to raise them. But done right, technology investments can deliver outsize returns and positive feedback loops in addressing all our goals. The United States cannot afford to get these decisions wrong. While missions are important, even more important are new institutions that will cut a path across them.
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September 15, 2021
6 Min read time
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