If they were faced with a lack of qualified workers, multinational corporations might accelerate their overseas hiring, building the capabilities of other nations while the US innovation system atrophies. Multinationals from China, India, and other developing nations, building on success in their domestic markets and on supplies of talented, low-cost scientists and engineers, could begin to dominate global markets, while US-based multinationals that still have a large percentage of their employees in the United States begin to fail, affecting jobs and the broader economy. 59 Financing the US trade deficit, now more than $600 billion or about 6% of GDP, requires more than $2 billion a day of foreign investment. Many economists argue that such an imbalance is unsustainable in the long term. A loss of competitiveness in key export industries could lead to a loss of confidence in the US ability to cover the debt, bringing on a crisis. As innovation and investment move overseas, domestic job creation and wage growth could stall, lowering the overall standard of living in the United States. The rapid pace of technological change and the increasing mobility of capital knowledge and talent mean that our current lead in science and technology could evaporate more quickly than is generally recognized if we fail to support it. The consequences would be enormous, and once lost, our lead would be difficult to regain. Scenario 3: Optimistic Case America Leads in Key Areas The relative competitive lead enjoyed by the United States will almost certainly shrink as other nations rapidly improve their science and technology capacity. That means greater challenges for the United States, but it also presents an opportunity to raise living standards and improve quality of life around the world and to create a safer world. The United States might have a smaller share of the world's economy, but the economy itself will be larger. For that reason, the success of other nations need not imply the failure of the United States. But it does require that the United States maintain and extend its capacity to generate value as part of a global innovation system. If we increase our commitment to leadership in science and technology, there are several likely results: • Although the US share of total scientific output continues to decline, the United States maintains leadership across key areas. US researchers become leaders of global research networks. The US education system sets the standard for quality and innovation, giving graduates a competitive edge over the larger number of lower wage scientists and engineers trained in the developing world. Our universities and national laboratories act as centers for regional innovation, attracting and anchoring investment from around the world. 39 C. Prestowitz. Three Billion New Capitalists: The Great Shift of Wealth and Power to the East. New York: Basic Books, 2005, p. xii. Our economy generates sufficient growth to reduce our trade imbalances, reduce the federal budget deficit, and support an aging population. Investors continue to find it attractive to place their funds in US firms seeking to innovate and generate jobs in America. US leadership in science and technology supports our military leadership and addresses the major challenges of homeland security. The rapid worldwide development that has resulted from advances in science and technology has raised global standards of living, but it also spawned a range of challenges that, paradoxically, will have to be solved through appropriate investments in research: 60 · To maintain its current rate of growth, by 2020 China will need to boost energy consumption by 150%, and India will need to do so by 100%. It will be essential to develop clean, affordable and reliable energy. The increased movement of people around the world will lead to more outbreaks of communicable diseases. Meanwhile, aging populations will require new treatments for chronic diseases. As the means to develop weapons of mass destruction become more widely available, security measures must advance. In an increasingly interconnected economy, even small disruptions to communications, trade, or financial flows can have major global consequences. Methods to manage complex systems and respond quickly to emergencies will be essential. The strains of managing global growth will require global collaboration. Around the world, the growing scale and sophistication of science and technology mean that we are much more likely to be able to solve those and other problems that will confront us. Advances in information technology, biotechnology, and nanotechnology will improve life for billions of people. The leadership of the United States in science and technology will make a critical contribution to those efforts and will benefit the lives of Americans here at home. Each challenge offers an opportunity for the United States to position itself as the leader in the markets that will be created for solutions to global challenges in such fields as energy, health care, and security. It is important to recognize that all nations in the global economy are now inextricably linked. Just as global health, environmental, and security issues affect everyone, so are we all dependent on the continued growth of other economies. It is clearly in America's interest for China, India, the EU, Japan, and other nations to succeed. Their failure would pose a far greater threat to US prosperity and security than would their success. In the global economy, no nation can prosper in isolation. However, it is the thesis of this report that it is important that such global prosperity be shared by the citizens of the United States. 60 National Intelligence Council. Mapping the Global Future: Report of the National Intelligence Council's 2020 Project. Pittsburgh: Government Printing Office, Dec. 2004, p. 62. CONCLUSION It is easy to be complacent about US competitiveness and pre-eminence in science and technology. We have led the world for decades, and we continue to do so in many fields. But the world is changing rapidly, and our advantages are no longer unique. Without a renewed effort to bolster the foundations of our competitiveness, it is possible that we could lose our privileged position over the coming decades. For the first time in generations, our children could face poorer prospects for jobs, health care, security, and overall standard of living than have their parents and grandparents. We owe our current prosperity, security, and good health to the investments of past generations. We are obliged to renew those commitments to ensure that the US people will continue to benefit from the remarkable opportunities being opened by the rapid development of the global economy. |