January 1st, 2015
08:43 PM ET

American innovation is in trouble

By Fareed Zakaria

If you ask people in Silicon Valley what makes it work, they will talk about many things — the ability to fail, the lack of hierarchy, the culture of competition. One thing almost no one mentions is the government. And yet, the Valley’s origins are deeply tied to government support. The reason there were so many engineers in California in the 1950s and 1960s was because large defense companies had attracted them there. Most of the legendary start-ups that fueled the computer revolution — Fairchild Semiconductor, Intel — got off the ground largely because the military, and later NASA, would buy their products until they became cheap and accessible enough for the broader commercial market. GPS, the technology that now powers the information revolution, was developed for the military.

And then there was government funding for research, which is sometimes thought of simply as large grants to universities for basic science but often was far more ingenious. My favorite example comes from Walter Isaacson’s fascinating new book, “The Innovators.” In the 1950s, the U.S. government funded a massive project at MIT’s Lincoln Laboratory, employing equal numbers of psychologists and engineers who worked together to find ways “that humans could interact more intuitively with computers and information could be presented with a friendlier interface.” Isaacson traces how this project led directly to the user-friendly computer screens of today as well as ARPANET, the precursor of the Internet.

Federal funding for basic research and technology should be utterly uncontroversial. It has been one of the greatest investments in human history. And yet it has fallen to its lowest level as a percentage of GDP in four decades.

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