Innovation Files: Where Tech Meets Public Policy

Global supply chains are cracking up. Even before the pandemic, a confluence of economic and geopolitical factors were accelerating the trend—from rising wages in China to nationalist sentiments sweeping the West, to the beginnings of a U.S.-China decoupling. Rob and Jackie sat down with Chris Caine, president of the Center for Global Enterprise, to break down the reasons for the massive disruption, discuss how different industry sectors are making different strategic calculations, and consider what the future might hold. Related:“Global Supply Chains Under Pressure, With Willy Shih,” ITIF Innovation Files podcast, May 2020.Stephen Ezell, “Digital Trade Growth, Rule-Making, and Supply Chain Resiliency: U.S. and Global Perspectives” (ITIF, October 2021).“Biden Officials Discuss White House Supply Chain Report,” ITIF event, June 2021.

The United States is the leader in life sciences innovation, but that has not always been the case. As global competition intensifies, it needs to continue spurring investment in R&D to stay on top. Rob and Jackie sat down with Stephen Ezell, vice president of global innovation policy at ITIF, to discuss the history of U.S. life sciences innovation and break down R&D costs versus the market prices of innovative biopharmaceuticals.MentionedAnusuya Chatterjee and Ross C. DeVol, “Estimating Long-Term Economic Returns of NIH Funding on Output in the Biosciences” (Milken Institute, 2012), 4.RelatedRob Atkinson and Stephen Ezell, “Five Fatal Flaws in Rep. Katie Porter’s Indictment of the U.S. Drug Industry” (ITIF, May 2021).Joe Kennedy, “The Link Between Drug Prices and Research on the Next Generation of Cures” (ITIF, September 2019).Event, “How Intellectual Property Has Played a Pivotal Role in the Global COVID-19 Response,” (ITIF, April 2021).

Silicon Valley obviously has a rich history of technological innovations that have transformed technology and the world as we know it. But with increased competition and stringent policies coming from Washington, its landscape has shifted. Rob and Jackie sat down with Avram Miller, co-founder of Intel Capital and author of The Flight of a Wild Duck to discuss how the decisions made by Intel and other tech giants have impacted Silicon Valley and how policymakers can better support the IT industry. MentionedAvram Miller, The Flight of a Wild Duck, (BOOKBABY, 2021).Andrew S. Grove, Only the Paranoid Survive: How to Exploit the Crisis Points, (Currency Doubleday, 1996).Mark Zachary Taylor, The Politics of Innovation: Why Some Countries Are Better Than Others at Science and Technology, (Oxford University Press, 2016).RelatedRob Atkinson and Jackie Whisman, “The Real History of Silicon Valley and the Lessons It Holds for Innovation Policy Today, With Margaret O’Mara” (ITIF, 2020).Rob Atkinson and Jackie Whisman, “The Rise, Fall, and Reinvention of IBM, With Jim Cortada” (ITIF, 2021).Rob Atkinson, “Be Grateful for ‘Big Tech’,” RealClearPolicy, June 6, 2018.

The first industrial robots appeared in the early 1960s and were initially optimized for production lines. These days, innovation in robotics is progressing rapidly as sophisticated localization and mapping enables improved robotic mobility, and as new levels of flexible manipulation allow robots to perform more specialized tasks. Rob and Jackie sat down recently with Rian Whitton, a strategic technologies analyst at ABI Research, to discuss the evolution of robotics and the prospects for accelerating productivity gains. Related:Robert D. Atkinson, “In Defense of Robots,” National Review, April 2017.Robert D. Atkinson, “Robotics and the Future of Production and Work” (ITIF, October 2019).Robert D. Atkinson, “The Case Against Taxing Robots” (ITIF, April 2019).

Antitrust policy should favor dynamic, innovation-driven competition, yet antitrust regulators generally don’t see it that way. Why is that? Rob and Jackie sat down recently with David Teece, the Thomas W. Tusher Professor in Global Business at UC Berkeley’s Haas School of Business, to discuss the intersection of innovation and economics in antitrust policy.  MentionedDavid J. Teece, Dynamic Capabilities and Strategic Management: Organizing for Innovation and Growth (Oxford: Oxford University Press, 2009).Rob D. Atkinson, Michael Lind, Big Is Beautiful: Debunking the Myth of Small Business, (MA: MIT Press, 2018). RelatedEvent, “Schumpeter v. Brandeis v. Chicago: The Antitrust Debate of Our Times” (ITIF, 2021).Rob Atkinson, “The Emergence of Anticorporate Progressivism” (American Compass, 2021).Rob Atkinson, “Antitrust Can Hurt U.S. Competitiveness” (The Wall Street Journal, 2021).

For the military, capabilities in the field matter most, not R&D. So, when it comes to artificial intelligence, the Defense Department has been moving quickly by standing up a special team, like a startup enterprise. Its first pilot project, “Project Maven,” began as an intelligence application. Now the push is on to apply it in other areas. Rob and Jackie sat down with retired Lt. Gen. Jack Shanahan, the first director of the Defense Department’s Joint Artificial Intelligence Center (JAIC), to discuss how AI is being used in the defense world and the implications for the broader AI ecosystem. MentionedDaniel Castro, Michael McLaughlin, “Who Is Winning the AI Race: China, the EU, or the United States? — 2021 Update” (Center for Data Innovation, 2021).Rob Atkinson, Jackie Whisman, “Podcast: Innovating in the Defense Sector to Remain Competitive With China, Featuring Michael Brown” (ITIF, 2021).RelatedEvent, “How to Deepen Transatlantic Cooperation in AI for Defense” (CDI, 2021).Rob Atkinson, “Emerging Defense Technologies Need Funding to Cross ‘The Valley of Death’” (RealClear Defense, 2020).ITIF, “ITIF Technology Explainer: What Is Artificial Intelligence?” (ITIF, 2018).

Industrial policy can produce great technological innovations to address major challenges for society. A perfect example is Operation Warp Speed, which has saved millions of lives during the COVID-19 pandemic. Rob and Jackie sat down with David Adler, an adviser on industrial strategy at the Common Good Foundation in the United Kingdom and author of “Inside Operation Warp Speed: A New Model for Industrial Policy,” published in the summer issue of the American Affairs Journal, to discuss lessons we can draw from the success of Operation Warp Speed to strengthen U.S. industrial policy in the future. MentionedDavid Adler, “Inside Operation Warp Speed: A New Model for Industrial Policy,” American Affairs Journal 5, no. 2 (2021).Richard Lipsey, Kenneth I. Carlaw, Clifford T. Bekar, Economic Transformations: General Purpose Technologies and Long-Term Economic Growth (Oxford University Press, 2005).Erica Fuchs, “Cloning DARPA Successfully,” Issues in Science and Technology 26, no. 1 (2009).William B. Bonvillian, The DARPA Model for Transformative Technologies - Perspectives on the U.S. Defense Advanced Research Projects Agency (Cambridge: Open Book Publishers, 2020).RelatedStephen Ezell, “Moore’s Law Under Attack: The Impact of China’s Policies on Global Semiconductor Innovation“ (ITIF, 2021).Robert D. Atkinson, “No Adopting an Industrial Policy Doesn’t Mean We’re Emulating China“ American Compass, 2021.Stephen Ezell, “TRIPS Waiver on COVID-19 IP Rights Wouldn’t Help Vaccine Access; It Would Just Harm Innovation“ (ITIF, 2021).

Addressing climate change requires accelerating clean energy innovation across the full range of economic sectors—from transportation to electricity, manufacturing, and agriculture. Rob and Jackie sat down with David Hart, a professor of public policy at George Mason University’s Schar School of Policy and Government and director of ITIF’s Center for Clean Energy Innovation, to discuss the scope of the challenge and the best paths forward for policymakers. Mentioned:United Nations Framework Convention on Climate Change, “Paris Agreement” (UNFCCC, November 2016).Intergovernmental Panel on Climate Change, “AR6 Climate Change 2021: The Physical Science Basis” (IPCC, August 2021).Related:Peter Fox-Penner, et al., “Clean and Competitive: Opportunities for U.S. Manufacturing Leadership in the Global-Low Carbon Economy” (ITIF, June 2021).Robert D. Atkinson, “Growth Through Innovation Will Help Fight Climate Change” (ITIF, August 2021).Linh Nguyen, “Refreshing the Global Agenda for Climate Innovation” (ITIF, 2021).

From bottle manufacturing to machine repair, automation has made just about every industry more efficient and adaptive to consumer demands. But despite its omnipresence, policymakers have failed to fully understand what drives industrial automation and why it matters for the economy. Rob sat down with Dave Vasko, director of advanced technology at Rockwell Automation, to discuss the latest trends in industrial automation—including innovations powered by artificial intelligence and virtual reality—and to consider how policymakers can spur manufacturing productivity and ensure the United States is globally competitive.Mentioned:Robert D. Atkinson and Daron Acemoglu debate: “Is the United States Tax System Favoring Excessive Automation?” (ITIF event, November 2020).Robert D. Atkinson, “Federal Statistical Needs for a National Advanced Industry and Technology Strategy” (ITIF, July 2021).Stephen J. Ezell, “Why Manufacturing Digitalization Matters and How Countries Are Supporting It” (ITIF, April 2018). Lawrence Summers and Alan Auerbach, “The Investment Tax Credit: An Evaluation” (National Bureau of Economic Research, November 1979). Related:Robert D. Atkinson, “10 Types of Work to Automate or Move Online for a COVID-19 World” (ITIF, July 2020).Robert D. Atkinson, “The Enterprise Automation Imperative—Why Modern Societies Will Need All the Productivity They Can Get” (ITIF, November 2019).Robert D. Atkinson, “How MIT’s ‘Work of the Future’ Project Gets It Wrong: Raising Taxes on Machinery and Software Would Kill Jobs and Hamper Wage Growth” (ITIF, 2020).

Antitrust policy provides a perfect lens to see the systematic differences between China and Western liberal democracies, according to Dr. Angela Zhang, director of the Center for Chinese Law at the University of Hong Kong. In her book Chinese Antitrust Exceptionalism: How the Rise of China Challenges Global Regulation, Zhang argues China leverages antitrust law to achieve industrial policy objectives—including in the tech sectors that are crucial to its rivalry with the United States—but it does so through an insular bureaucracy that is surprisingly fragmented and therefore difficult for outsiders to understand. Rob and Jackie sat down with Dr. Zhang to discuss the internal power dynamics that shape China’s regulatory environment and how it affects the competitive balance of power in the global economy.Mentioned:Angela Huyue Zhang, Chinese Antitrust Exceptionalism: How the Rise of China Challenges Global Regulation(Oxford University Press, 2021).Robert D. Atkinson and Michael Lind, Big Is Beautiful: Debunking the Myth of Small Business (The MIT Press, 2018).Related:Robert D. Atkinson and Michael Lind, Who Wins After U.S. Antitrust Regulators Attack? China. (ITIF, 2018).Robert D. Atkinson and David Moschella, Competing With China: A Strategic Framework (ITIF, 2020).