Business, Government and Science: The Need for a Fresh Look

The second Nixon administration starts amid growing concern about a decline in American competitiveness in the world economy, ascribed to our loss of technological lead in a number of fields. It would be easy to follow very mistaken policies at such a time, because of what some people would call "natural political reactions," others our sad institutional habit of fighting against, instead of working to take advantage of, desirable trends for mankind.

Two such major trends are clearly in train, and we are probably underestimating both of them. First, between now and 1985 the poorer countries of the world will become the most economic producers and exporters of an expanding range of existing manufactured goods, while the rich one-fifth of the world (the United States, Japan, and the European Economic Community, or EEC) will switch increasingly to the production and export of know-how. The danger here is that Americans may respond with pressure for protectionism, to slow the growth both of our imports of cheap manufactures and of our exports of profitable know-how.

Secondly, there has been a big reduction in U.S. government research and development on armaments and space, which had spin-off effects for American export industries even while pursuing other and often wasteful goals. It is natural to ask: "Can we not use redeployed government research and development to keep U.S. technology ahead in specific civilian fields?" A vague policy of this kind could produce technological marvels which are commercial disasters. We should instead be devising policies which: (a) reconcentrate our research efforts on things which aim to be commercial successes; and (b) restructure our market system so that commercial rewards attend anything which proves most effective in satisfying man's most urgent needs, measured in human terms both at home and abroad.

The object of this article is to further discussion of a trade and science policy which could take advantage of these opportunities before us. Since any policy introduced during the second Nixon administration in 1973-1977 will have its main effect only in the 1977-1987 decade, the discussion of specific ideas has become urgent.

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