Trade group fears IT decline

A report from the American Electronics Association warns that the decreasing focus on science and technology inside the United States will topple the country's competitive advantage.

The trade group's report notes that federally sponsored research and development funding for information technology has declined during the past decade and a half as priorities have shifted to life sciences. Authors of "Losing the Competitive Advantage?" also argued the U.S. educational system fails to provide the math and science skills needed to compete in the workforce, while higher education does not graduate enough scientists and engineers to keep up with the high-tech industry's growth.

Other countries are leaping ahead, the report says. China cultivates almost four times as many engineers than the United States does. Chinese officials offer tax breaks to companies conducting R&D. And India's technology parks invest in home-bred workers, which, in turn, join dominant Indian technology companies. Because U.S. officials have tightened immigration policy since the Sept. 11, 2001, terrorist attacks, foreigners go elsewhere. Applications to U.S. graduate engineering programs fell 36 percent last year. The report states that the trend is tragic because the financial support of foreign nationals, who comprise more than 50 percent of math and engineering doctorates, make many of these programs feasible.

The United States could fall victim to its own successful promotion of capitalism worldwide, according to the report. The authors write: "The United States has long urged the rest of the world to adopt free-market principles. The good news is that many countries have now listened and represent new markets for U.S. products and services. ... But the bad news is, ironically, that many countries listened. They have entered the global economy and now aggressively compete against the United States -- or soon will."

Bob Cohen, a senior vice president at the Information Technology Association of America, said ITAA members agree that some indicators suggest U.S. leadership in high technology may be at risk, if the country does not sharpen its competitiveness in global markets.

"Unfortunately, there is no simple strategy or single approach that will accomplish this goal," he said. Likewise, an attempt to raise global barriers to competition is a Band-Aid approach that might have corrosive long-term effects. "Global competitiveness is a marathon, not a sprint. Winners will be those nations that plot the right direction, marshal the necessary resources, and stay the course. Investments in education and research will be key, as will factors like capital availability, enlightened tax policy, and a regulatory environment that fosters market driven approaches to technology and innovation."