Innovate or perish

THE UNITED STATES is losing its competitive advantage and may soon lose its innovative edge. It does not invest fully in resources most critical for sustained high-tech leadership, and the most talented and productive regions of the Third World challenge our dominance with skills and efforts only we once possessed.

The origins of the decline can be traced to the 1960s, when the U.S. trade surplus in high-tech manufactured goods began slipping. By 1972, the surplus had disappeared.

In the 1980s, U.S. manufacturers rapidly lost market share in high-tech goods to companies based in Asia. "Japan Inc." was the presumed threat, and the Reagan administration’s buzzword was "competitiveness." I served on one of President Reagan’s special commissions on competitiveness, but like most such commissions, it was chiefly intended to stave off congressional pressure to remake the U.S. economy in Japan’s image. Competitiveness was so overused in political discourse that the news media called it the "C-word." Meanwhile, Japanese electronics manufacturers drove their U.S. counterparts out of business.

By Lewis M. Branscomb, Lewis M. Branscomb is professor emeritus in public policy and corporate management at Harvard University and a visiting faculty member at the Graduate School of International Relations and Pacific Studies.

Full Story: http://www.latimes.com/news/opinion/sunday/commentary/la-op-innovate1jan01,0,6060806.story?coll=la-sunday-commentary