US Competitiveness Offers Reasons for Optimism Amid Turbulence

Despite significant challenges ahead, the U.S. economy leads the world in high-tech manufacturing and technology-infused services, said Deborah Wince-Smith, president of the nonprofit Council on Competitiveness.
Deborah Wince-Smith | AAAS

The United States is poised to do very well in the global economy as the world continues a transition to an age in which ideas, imagination and creativity are more important than access to physical resources, the president of the nonprofit Council on Competitiveness told an audience at AAAS recently.

"The United States has so many advantages in this new world," Deborah Wince-Smith said. "We lead the world in high-tech manufacturing and technology-infused services. Our supply chains are agile, deep and diverse." She said the U.S. science and technology effort remains "globally unparalleled," with more than $400 billion invested each year in research and development.

But it is the intangibles that make the big difference. "Our culture of entrepreneurship, of risk taking, of creativity, of inclusion and diversity, is unmatched around the globe," she said.

It was a positive message at a time when the U.S. economy is still under stress and unemployment remains high. But in the last event of the 2013 Distinguished Speaker Series, organized by the AAAS Science & Technology Policy Fellowships program, Wince-Smith ticked off reasons for optimism amid the turbulence.

The nation needs "engineers who think like artists and artists who think like engineers."

Deborah Wince-Smith

"U.S. manufacturing is growing and is leading our recovery," she said. "Last year, it grew three times faster than the overall economy" and accounts for 60 percent of U.S. exports. Manufacturing and energy are tightly interlinked, she noted, and at their intersection, "There is an historic opportunity for the United States."

The boom in natural gas production, due largely to new recovery methods such as hydraulic fracturing, has provided the United States a domestic energy abundance that seemed far-fetched a decade ago. "The use of natural gas to revitalize manufacturing will be a tremendous game changer," Wince-Smith predicted.

Energy-intensive industries such as chemicals, plastics and steel will have a critical cost advantage, she said, noting that natural gas prices now are roughly five times more expensive in Japan than in the United States, three times more expensive in the European Union, and twice as expensive in China. "This is a huge burden on the backs of our competitors," Wince-Smith said.

Still, there are significant challenges ahead. Two-thirds of global research and development is being done outside of the United States and game-changing technologies "can and are emerging everywhere and anywhere," Wince-Smith said. Moreover, knowledge, skills, capital, and production resources are highly mobile, with many products — large and small — now the result of collaborations that cross national boundaries.

She noted that the Boeing 787 Dreamliner is built with resources from seven nations on six continents, and the uniforms for the U.S. Olympic snowboarding team were designed and manufactured using resources from six nations on three continents.

Wince-Smith said globally competitive industries are emerging not only in the usually cited places — China, South Korea and India — but also in nations such as the United Arab Emirates, Colombia, Brazil, Mexico, Turkey and Vietnam. She noted that Australia is a world leader in quantum computing, Ireland is a leader in software development for financial services, Brazil's Embraer builds regional jet aircraft, and the Czech Republic is coming on strong in development of low-cost electric vehicles.

With such knowledge and technology widely distributed around the globe, she argued, the competitive advantage will go to the people, companies and countries that can best exploit the tools and know-how, whatever the source. In China, for example, the Beijing Genomics Institute has purchased 128 advanced genome sequencers from San Diego-based Illumina, Inc. That gives it more gene-sequencing capacity, Wince-Smith said, than all of the genome centers supported by the U.S. National Institutes of Health combined.

Many new products are the result of international collaborations. For example, the Boeing 787 Dreamliner is built with resources from seven nations on six continents. | Boeing

The United States is "in the game to be competitive now and in the future," Wince-Smith said, with a growing realization that manufacturing prowess, driven by energy innovation, is a key to economic leadership and national security.

"Energy innovations are needed across every domain," Wince-Smith said, including transportation, consumer goods and industrial processes. "American manufacturers now have a golden opportunity to move into this new era of industrial transformation, sustainability, energy innovation and market opportunity. We have a big brass ring to grab onto, and we must seize the moment."

To that end, the Council on Competitiveness, an assembly of CEOs of major corporations, university presidents and the heads of national labor organizations, has entered an American Energy and Manufacturing Competitiveness Partnership with the Department of Energy. The goal, according to Wince-Smith, is to increase U.S. competitiveness in the production of next-generation, clean-energy products and to spur manufacturing competitiveness across the board. The initiative seeks to integrate clean energy throughout the supply chain, she said, and increase investment in tools for scaling up promising technologies.

Beyond the intersection of energy and manufacturing, she said, the United States also is well-positioned to take advantage of revolutions in digital technology, biotechnology, nanotechnology and cognitive sciences. In the biotech realm, for example, the remarkable cost-reduction in DNA sequencing — down 100,000-fold in a decade — should "open the floodgates of innovation," Wince-Smith said.

At the same time, she cautioned that the U.S. research enterprise has been slow to respond to the multidisciplinary nature of many cutting-edge developments. The "single discipline, single investigator" model remains dominant in many universities, she said, while challenges such as those as the intersection of food, energy and water usage cry out for multidisciplinary approaches.

Wince-Smith also made a plea for the arts, humanities and social sciences as important for a society that hopes to remain economically competitive in the future "Business disciplines like management, marketing and design need to also be the purview of science and engineering," she said. "No one organization or discipline has all the necessary resources for this high-value innovation." She said the nation needs "engineers who think like artists and artists who think like engineers."

Wince-Smith recalled a talk in Kyoto, Japan last year where Shinya Yamanaka, a winner of the 2012 Nobel Prize for Physiology or Medicine for his research on stem cells, paid tribute to the vitality of the American scientific and technical environment. Yamanaka said the first crisis in his scientific career occurred when he returned to Japan after working in the United States at the University of California, San Francisco. He said he suffered from PAD syndrome — "Post America Depression." He described the diverse team he had worked with in San Francisco, Wince-Smith said. "It's that culture of creativity and innovation and risk taking and inclusion that he wants to develop in Japan," she said.