The annual State of the Union (SoU) message is carefullycrafted performance art. These evening winter chats are scoured for quotablephrases to be employed in derisive or affirming ways. While it appears we maybe losing the future in a muddle of high unemployment, stagnant wages anddeclining spirits, the most recent SoU instructed the American people toinnovate: "The first step in winning the future is encouraging Americaninnovation. What we can do—what America does better than anyone—is spark thecreativity and imagination of our people."
In the last month or so, I've read white papers, CEOspeeches, editorials and op-eds in response to what some now call a crisis ininnovation, perhaps to mirror the purported crisis in education. The two arefrequently united hand-in-glove. The desired response to many a crisis is "sendus money and send it now."
Professional societies of the scientists and engineers haverecently assembled task forces of strategic thinkers to respond to the crisis.They've now put forth proposals. The BIO organization, led by James C.Greenwood, in June issued "Unleashing the Promise of Biotechnology: AdvancingAmerican Innovation to Cure Disease and Save Lives."
Early in 2010, theAmerican Chemical Society (ACS) assembled a task force at the request of itsthen president, and my Purdue colleague, Prof. Joseph S. Francisco. Prof.George Whitesides, a Harvard professor and entrepreneur of note, led theeffort. The report was released this summer as "Innovation, Chemistry andJobs," touting benefits of "New Technologies for Society; New Jobs forChemists."
I highly recommend these two reports in that both are veryrelevant to readers of ddn and areespecially well done. The long appendix of the ACS paper is a treasure chest offine information such as business performance statistics, employmentdemographics, a list of successful young firms started by chemist-entrepreneursand license agreement templates from academic tech transfer offices.
The senior citizen in this area of opining is the Council onCompetitiveness, which celebrates its 25th anniversary this year; let me remindyou, it's also the International Year of Chemistry (IYC2011). The council'swebsite is a wealth of thoughts on policy from this unique egalitarianorganization in which business, labor and academia collaborate.
There are common recommendations that run through mostopinion pieces on the innovation topic. These typically include: (1)liberalizing visas for technically educated immigrants because they have atrack record for positively changing our world through entrepreneurship (i.e.,stop the xenophobia and get a return on our investment in these great people); (2)providing an aggressive R/D tax credit; (3) reducing capital gains (0 percentis ideal) to encourage investment in small, high-risk, innovative firms, manyof which will have no sales for years; (4) reforming and funding the patentsystem, making it more responsive with fewer interminable delays; (5)encouraging public-private partnerships whereby academics, government units andindustry can work together on major challenges—for example, by incentivizingmatching of research support from government (Small Business Innovation Research grants),venture firms and large, established companies; (6) expanding entrepreneurshipprograms in academia, especially for science and engineering students; (7)networking prodigiously because chance favors the prepared encounter; (8)reforming the U.S. Food and Drug Administration (FDA) to allow for a morebalanced assessment of risk-benefit for patients; and (9) reforming education,especially in the STEM subjects.
I have an essay in my head on each of these topics, but Iwill spare you. I do see wisdom in each of them, but I believe the problem isfar more spiritual. I describe it as a crisis of confidence rather than one ofrules and incentives. But please go to the sources I've referenced above. Theyare well-reasoned.
As an entrepreneur, at the end of the day, I have severalproblems with our trajectory as we kick the can down the road, move the goalposts and look outside of various boxes of black tea for flowery phrases de jour. I take the liberty here ofrewriting the win-the-future phrases from the SoU quoted back up top: "Thefirst step in winning the future is to stop discouraging American innovation,stop distrusting business and stop the class warfare rhetoric. What we cando—what America in the past has done better than anyone—is not extinguish thesparks of creativity and imagination of our people."
Mr. President, you and your team don't get it. The uncertaindirection of government—the "deer in the headlights" feel Congressengenders—has sapped our spirits and kept capital out of the innovation arena.You are driving corporate earnings overseas to high-growth economies. You arenot helping, but you could. There still is time. You have said some very smartthings, but your actions have not delivered the change we hoped to believe in.The same is true of a long line of your predecessors of both parties. One ofthem from your tribe famously said, "the era of big government is over," whileanother from your opposition said, "government is not the solution to the problem,government is the problem." These are indisputable facts proven by experimentover centuries. Were you not listening? If you want to keep the big airplane,stop shooting at those who take flight in smaller aircraft.
Free-market capitalism is hard enough to defend againststatists without having to justify absurd compensation schemes for topexecutives and hedge fund managers. Enough already! We have a new set of robberbarons and we may need a new Teddy Roosevelt to help bring them to their senses.Some of them have worked for pharmaceutical firms who have let 120,000 peoplego since 2009.
It's not a pretty picture, but more government is not the onlyanswer. Greed seems to have no bounds in some quarters and it wreaks havoc onthe industries where it abounds. A little more discipline and self-restraintcan restore capitalism's good name. Both government and industry need to stepup, wise up and do what is known to work.
Peter T. Kissinger is professor of chemistry at PurdueUniversity, chairman emeritus of BASi and a director of Chembio Diagnostics,Phlebotics and Prosolia.
