Tech policy may be next up in Congress – but we need a broader view

Now that the COVID-19 American Rescue Plan has been enacted, speculation is growing that the next big bill will be a technology and competitiveness act. According to the Washington Post, a Chinese-focused technology bill may be replacing an infrastructure bill as the next legislative push. Late last month, Senate Majority Leader Chuck Schumer directed Senate committees to start working on such a package, using last year’s Endless Frontier Act as their starting point.

Since that bill garnered bipartisan support, the thinking is that it would be a good follow-up to the partisan fight on the COVID-19 bill. That support is riding on wave of concern over a rising technological competition from China, the availability of medical supplies during the pandemic, and the current semiconductor shortage.

However, there are a number of approaches that future policy could take. The Endless Frontier Act calls for the reconfiguration of the National Science Foundation (NSF) into a National Science and Technology Foundation (NSTF). However, it is not clear that grafting a large technology development and commercialization organization on to the existing basic science funding agency is the best alternative (as I noted in earlier postings).

An alternative proposal to create a National Technology Foundation (NTF) was recently suggested by the National Security Commission on Artificial Intelligence (see previous posting). The NTF would be separate from but parallel to the NSF. The NTF would focus on technology development and commercialization in a number of key technologies, including AI, biotechnology, quantum computing, semiconductors and advanced hardware, robotics and automated systems, 5G telecommunications, additive manufacturing (aka 3D printing), and energy storage technology.

Another approach is the creation of a number of agency specific DARPA-like entities. The President seems to have already endorsed the creation of a Health Advanced Research Projects Agency (HARPA).

Beyond the question of NSTF, NTF or “X”ARPA, there are a number of other technology policies that the new legislation should consider. For example, both the Endless Frontier Act and the AI Commission call for a regional technology hub program in the Commerce Department. And the AI Commission report contains over 60 specific funding proposals. Then there are a number of specific technology policy bills already introduced, such as the Democracy Technology Act (S. 604) sponsored by Sen Warner and others to create an interagency International Technology Partnership Office at the State Department headed by a Special Ambassador for Technology, with a $5 billion International Technology Partnership Fund to support joint research projects. It is unclear which and how many of these policy proposals will make it into the bill.

It is also unclear whether the new bill will include elements from last year’s America LEADS Act (which Senator Schumer co-sponsored). Included in that bill was a number of manufacturing, research, and technology development proposals such as expanding the Manufacturing USA Institutes program, expanding the Manufacturing Extension Partnership (MEP) program, and expanding the National Security Innovation Capital program and other defense-related critical technology programs. But that bill went beyond science and technology policies to include provision such as sanctions on China, support for continued stationing of US troops in Japan and South Korea, and provide refugee status to resident of Hong Kong and Xinjian province.

What is clear is that the process will be messy and disjointed. I participated as Senate staff in the creation and enactment of the Omnibus Trade and Competitiveness Act of 1988. That bill, as sprawling as it was, was at least guided by the framework and rhetoric of improving US economic competitiveness. As I’ve pointed out, the competitiveness framework has been missing for a number of years. It has been replaced with a “fear-of” driven policy – in this case the fear-of-China.

I understand the importance of the fear-of approach in motivating action. The 1980s it was a fear-of-Japan industrial policy. In 1950s and 60s had a fear-of-Russia industrial policy. One could even argue that Hamilton’s Report on Manufacturing and Henry Clay’s American System were in part a fear-of-Britain industrial policy. But our policy needs to go beyond reaction. We need a way to look systematically at the foundations of our economic competitiveness. Just as monitoring one’s personal heath is better than waiting for a diagnosis and way better than just treating the symptoms, we need a mechanism to go beyond the current problems.

Unfortunately, none of the existing proposals addresses this need. Yes, they contain various study and strategy-creation provisions. But they are narrow in scope. For example, the AI Commission’s recommendation for a Technology Competitiveness Council and a National Technology Strategy is focused on the development of emerging critical technologies – not on the competitiveness of the economy. Similar, the President’s Executive Order on supply chains is focused on issues of resilience and security which will help improve competitiveness – rather than starting with the goal of competitiveness and looking at how supply chains enhance or threaten that goal.

Thus, I am renewing my call for a new push for how we address the competitiveness issue. One way is to reinstate the Competitiveness Policy Council (CPC). Created in the 1988 Trade and Competitiveness Act, the CPC was defunded in the 1990’s as part of a GOP budget cutting exercise. During its life time, the CPC published a number of good reports — but never seemed to get much political traction. [In full disclosure, I wrote the legislation for the CPC and helped get it up and operating back when I served on Senate staff — so its demise was rather painful to me].

A more aggressive approach was outline over a decade ago by the Center for American Progress. The CAP proposal calls for:

• A Quadrennial Competitiveness Assessment by an independent panel of the National Academies whose objectives are to collect input and information from many sources and perform a horizon scan that identifies long-term competitiveness challenges and opportunities
• A Biannual Presidential Competitiveness Strategy that lays out the president’s competitiveness agenda and policy priorities, and captures the attention and buy-in of cabinet principals
• An Interagency Competitiveness Task Force led by a new deputy at the National Economic Council that develops the biannual strategy, oversees White House coordination of competitiveness initiatives, and monitors their implementation by agencies
• A Presidential Competitiveness Advisory Panel of business and labor leaders, academics, and other experts who assist the administration in developing policy details.

I realize that it seems like this was tried (and failed) back in the Obama Administration with the President’s Council on Jobs and Competitiveness. But I would argue that the “Competitiveness” part of the title was basically ignored. Even the Council referred to itself as the “Jobs Council.”

Regardless of what mechanism is used, we need to refocus the discussion on broader issues of “Build Back Better” and competitiveness, not just critical technologies. Unfortunately, I doubt the coming technology package will contain this broader view. That will be a missed opportunity.

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