For more than two centuries, the term “Yankee ingenuity” has stood for inventiveness and the practical approach to problem solving that first characterized New England in the early 1800s and has since been a hallmark of the American spirit.
That ingenuity, coupled with the world’s largest market and a federal government that a generation ago invested more in scientific research and development than the rest of the world combined, explains why the United States once led the world in innovation.
But that lead is now gone. Other nations now routinely beat America on international indicators of innovation. Here at home, the rate of new business startups has fallen to 1970s levels, while America runs an annual trade deficit in high-tech goods of more than $100 billion.
We now face many nations that desperately want a more innovation-based economy, and they are putting in place an array of policies to get there – some fair, some unfair. And instead of responding by pulling together in a bipartisan approach with a robust innovation policy so that America can win, we have let partisan politics divert us.
This is why it’s so important that innovation be a central part of the 2016 presidential campaign. We can’t, to use Donald Trump’s slogan, “make America great again” without enacting a policy agenda to get Yankee ingenuity back into high gear. Nor can we solve key social challenges such as making clean energy affordable or boosting productivity.
Unfortunately, the topic of innovation has been conspicuously absent from this year’s presidential campaign agendas. Instead, they are consumed by hot-button issues such as taxes, immigration, foreign policy, and health care. On these and many other issues, America will need to choose between a Republican vision or a Democratic one. Higher taxes or lower. Repeal Obamacare or expand it. More immigration or less. Luckily, effective innovation policy is – or least should be – a blank canvas with room to incorporate the best ideas from both sides of the political aisle.
The candidates could start by moving beyond the stale fight over regulation, with one side saying we need less and the other saying we need more. What we really need is smart, timely, and efficient regulation that, among other things, reduces regulatory delay and uncertainty. When companies submit applications, they should receive approvals or denials in a timely manner; they should not have to wait for years. That is why the next president should push for budgets that ensure regulatory agencies, including the Patent and Trademark Office, are adequately staffed – but also require them to develop operational strategies for streamlining regulatory decisions and minimizing delay.
Candidates also should commit to establishing an Office of Innovation Review in the White House Office of Management and Budget. Its job should be to serve as the “innovation champion” in government and to push agencies to either affirmatively promote innovation or achieve a particular regulatory objective in a manner that is least damaging to innovation.
Next, the candidates need to stop retreading the debate over whether government or business is more responsible for scientific and technical innovation. Many on the left dismiss the role of the private sector, so they support policies that would dramatically reduce incentives for companies to innovate, such as weakening intellectual property protections both here and in the trade agreements the government signs. In contrast, many on the right reject the notion that federal support for research plays a role in helping the private sector innovate, even though scholarly evidence is crystal clear on this positive relationship.
This means that candidates from both parties need to affirmatively commit to exempting federal support for research from the onerous budget caps that have brought unprecedented declines in federal science funding over the last three years. Saving money now by cutting science is merely eating our seed corn. Instead, the presidential candidates should pledge that the budgets they send to Congress will increase federal support for science and technology by at least $30 billion per year.
But at the same time, Republican and Democratic candidates need to commit to supporting trade agreements that would not weaken intellectual property standards. (As Mark Twain wrote, “a country without a patent office and good patent laws [is] just a crab, and couldn’t travel any way but sideways or backways.”) At the same time, we need to significantly increase tax incentives for investing in innovation here at home. Wall Street increasingly pressures publically traded corporations for immediate returns, making it ever more difficult for them to invest for the long term, including in research and development, workforce training, or even new machinery and equipment. Candidates should commit that they will lead a corporate tax reform effort with Congress that will include not just a lower corporate rate (now the highest in the world) but also will expand the research and development tax credit rate from 14 percent to 25 percent and institute a so-called “innovation box” where corporate revenues from the sale of innovation-based goods and services are taxed at a lower rate.
We also need to find common ground on high-skilled immigration. Democrats and Republicans show no signs of being anywhere near agreement on the issue of comprehensive immigration reform, but both sides should be able to agree that the country needs to attract more high-skilled foreign workers for jobs in science, technology, engineering, and math. We need many more of these STEM workers and students, so we need to make it easy for foreign scientists and engineers to easily and quickly get green cards and eventually become citizens.
In fact, there is a whole set of innovation policy issues that candidates from both sides should be able to agree on – the real question is whether they care enough to commit some political capital. These include expanding funding for STEM education; supporting passage of the Startup America Act, which will make it easier for high-growth startups, in part by expanding the R&D tax credit for new business; and passing recently drafted legislation to create a system of national “manufacturing universities” that would conduct research and teach subjects in the field of manufacturing.
Finally, we need candidates from both parties to call on Americans to fully embrace our spirit of Yankee ingenuity. Today, a growing array of voices see innovation as something to be opposed, fearing that it will hurt the environment, eliminate jobs, or intrude on our privacy. But America became the world’s innovation leader because it put progress ahead of fear. If we are to reignite what Lincoln called America’s “fire of genius,” we need a president who rejects this neo-Ludditism and embraces good, old-fashioned risk-taking that is guided by faith in the future, and supported by a robust, bipartisan federal innovation agenda.
Robert Atkinson is the founder and president of the Information Technology and Innovation Foundation, a think tank focusing on the intersection of technological innovation and public policy.